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General provisions on the Structural Funds

Archives

This regulation aims to reduce disparities in development and promote economic and social cohesion in the European Union (EU). In this way, the effectiveness of the Community's structural assistance is improved by concentrating the assistance, and simplifying its allocation by reducing the number of priority Objectives. To identify more precisely the responsibilities of the Member States and the Community at each stage: programming, monitoring, evaluation and control.

ACT

Council Regulation (EC) No 1260/99 of 21 June 1999 laying down general provisions on the Structural Funds [See amending acts].

SUMMARY

Major socio-economic disparities persist between different regions of the Union. For example, the per capita gross domestic product (GDP) of Portugal is twice that of Greece. Similarly, Hamburg is Europe's richest region with a per capita income four times that of Alentejo. These regional disparities are prejudicial to the Union's cohesion.

Economic and social cohesion has been one of the EU's priority objectives for some years now. By promoting cohesion, the Union is encouraging harmonious, balanced and sustainable economic development, creating employment and contributing towards environmental protection and the elimination of inequality between men and women.

In order to implement the drive for economic and social cohesion, the European Commission has created financial instruments: the Structural Funds and the Cohesion Fund. These funds part-finance regional and horizontal operations in the Member States.

STRUCTURAL FUNDS

Four types of Structural Fund have been introduced over the years, as the process of building Europe has progressed:

  • The European Regional Development Fund (ERDF) contributes mainly to assisting the regions whose development is lagging behind and those undergoing economic conversion or experiencing structural difficulties ;
  • the European Social Fund (ESF) mainly provides assistance under the European employment strategy;
  • the European Agricultural Guidance and Guarantee Fund (EAGGF) Guidance Section helps in both the development and the structural adjustment of rural areas whose development is lagging behind by improving the efficiency of their structures for producing, processing and marketing agricultural and forest products ;
  • the Financial Instrument for Fisheries Guidance (FIFG) supports restructuring in the fisheries sector.

PRIORITY OBJECTIVES, COMMUNITY INITIATIVES AND INNOVATIVE MEASURES

To improve the effectiveness of structural measures, Regulation (EC) No 1260/1999 reduces the number of Objectives from seven during the previous period (1994-99) down to three for 2000-06:

  • Objective 1 promotes the development and structural adjustment of regions whose development is lagging behind, i.e. whose average per capita GDP is less than 75 % of the European Union average. This new Objective also covers the most remote regions (the French overseas departments, the Azores, Madeira and the Canary Islands) as well as the areas eligible under the former Objective 6 (areas with low population density) created by the Act of Accession of Austria, Finland and Sweden. As before, two thirds of Structural Fund operations concentrate on Objective 1 and almost 20 % of the Union's total population is affected by measures taken under this Objective.
  • Objective 2 contributes to the economic and social conversion of regions in structural difficulties other than those eligible for the new Objective 1. It brings together the former Objectives 2 and 5(b) and other areas facing the need for economic diversification. Overall it will cover areas undergoing economic change, declining rural areas, depressed areas dependent on fisheries and urban areas in difficulty. No more than 18 % of the Union's population is covered by this Objective.
  • Objective 3 gathers together all the measures for human resource development outside the regions eligible for Objective 1. This Objective replaces the former Objectives 3 and 4. It is the reference framework for all the measures taken under the new Title on employment inserted in the EC Treaty by the Treaty of Amsterdam and under the European employment strategy.

Transitional arrangements have been introduced for the regions previously eligible for Objectives 1, 2 or 5(b) between 1994 and 1999 but which are no longer eligible for Objectives 1 and 2 in 2000-06. Under these arrangements, decreasing aid is granted to the following regions: East Berlin (Germany), Hainault (Belgium), Cantabria (Spain), Corsica and the districts of Valenciennes, Douai and Avesnes (Portugal), Molise (Italy), Southern and Eastern Ireland, Flevoland (Netherlands), Lisbon and Tagus Valley (Portugal), Northern Ireland and the Highlands and Islands (United Kingdom). This decreasing transitional aid is granted so that financial support from the Structural Funds is not cut off abruptly in the areas concerned. It is also intended to consolidate the progress made as a result of structural assistance during the previous programming period.

The new Regulations also reduce the number of Community Initiatives from 13 during 1994-99 to four for 2000-06. The new Initiatives are:

  • Interreg III, which aims to stimulate cross-border, transnational and inter-regional cooperation;
  • Leader+, which promotes rural development;
  • Equal, which provides for the development of new ways of combating all forms of discrimination and inequality in access to the labour market;
  • Urban II, which encourages the economic and social regeneration of declining towns, cities and suburbs.

The Commission can also support new and little-exploited ideas through innovative measures under the ERDF. The following three working themes have been selected:

  • regional economies based on knowledge and technological innovation;
  • eEurope-regio: the information society and regional development;
  • regional identity and rural development.

FUNDING

The total budget for the Structural Funds amounts to EUR 195 billion in 2000-06, not including the Cohesion Fund.

To improve the effectiveness of the appropriations committed in the regions whose development is lagging behind, the new rules provide for a significant concentration of funding on Objective 1. The breakdown between the different types of assistance is as follows:

  • 69.7 % of the total allocation goes to Objective 1, i.e. EUR 135.9 billion;
  • 11.5 % of the total allocation goes to Objective 2, i.e. EUR 22.5 billion;
  • 12.3 % of the total allocation goes to Objective 3, i.e. EUR 24.05 billion;
  • 0.5 % of the total allocation goes to the FIFG outside Objective 1, i.e. EUR 1.1 billion;
  • 5.35 % of the total allocation goes the Community Initiatives, i.e. EUR 10.43 billion;
  • 0.65 % of the total allocation goes to innovative measures and technical assistance, i.e. EUR 1.27 billion.

The Structural Funds contribute to the different types of assistance as follows :

  • The ERDF contributes to financing Objectives 1 and 2, the Community Initiatives Interreg III and Urban II and relevant innovative measures.
  • The ESF contributes to financing Objectives 1, 2 and 3, the Equal Initiative and relevant innovative measures.
  • The EAGGF Guidance Section contributes to financing Objective 1 and the Leader+ initiative.
  • The FIFG contributes to financing Objective 1 and assistance in regions outside Objective 1 up to 0.5 % of the total allocation of the Structural Funds, and also to funding relevant innovative measures.

The performance reserve is a new feature, designed to motivate the final beneficiaries. 4 % of the appropriations allocated to each Member State are placed in reserve until 2003, for distribution to the best-performing programmes by 31 March 2004 at the latest. Each Member State will make proposals to the Commission on the basis of monitoring indicators that it has introduced itself.

GENERAL PRINCIPLES

The principles underpinning the operation of the Structural Funds have been strengthened or specified in greater detail: (a) assistance must be part of a programme; (b) as many parties as possible must be involved; (c) Community assistance may not replace national funds; (d) spending by the Funds must be properly managed, monitored and evaluated; there must be proper controls on payments.

Programming

Programming is one of the essential elements of the 1988 and 1993 reforms of the Structural Funds and remains central to the 1999 reform. Programming involves the preparation of multiannual development plans and is undertaken through a partnership-based decision-making process, in several stages, until the measures are taken over by the public or private bodies entrusted with carrying them out.

Under the General Regulation on the Structural Funds, the period covered is seven years for all the Objectives (2000-06), although adjustments will be possible depending on the mid-term review (at the end of 2003).

Development and conversion plans are first submitted by the Member States. These plans are based on national and regional priorities and include:

  • a precise description of the current situation in the region (disparities, lags, development potential);
  • a description of the most appropriate strategy for achieving the stated objectives ;
  • indications as to the use and form of the contribution from the Funds.

Next the Member States submit programming documents to the Commission following its general guidelines. Programming documents can take the form of:

  • Community support frameworks (CSFs) translated into operational programmes (Ops) : documents approved by the Commission in agreement with the Member State concerned, which contain both the Member State's and the Funds' strategy and priorities for action, their specific objectives, the contribution from the Funds and the other financial resources;
  • single programming documents (SPDs): comprising a single document, approved by the Commission and combining the data contained in a Community support framework and operational programme (integrated regional programme containing the programme's priorities, a short description of the proposed measures and an indicative financing plan).

The programming documents for Objective 1 are generally CSFs translated into Ops, although SPDs can be used to programme amounts of less than EUR 1 billion. All the programming documents for Objective 2 are SPDs. By contrast, the choice of what form programming documents for Objective 3 will take is left to the regions and Member States.

The Commission negotiates with the Member States on the basis of their programming documents and makes an indicative allocation from the Funds to each form of assistance for each Member State.

Partnership

The new rules continue this approach by expanding partnership to include the regional and local authorities, the economic and social partners and other competent bodies and by involving the partners at all stages, starting with approval of the development plan.

Additionality

This principle requires Community assistance to be additional to national funding and not to replace it. For each Objective the Member States must maintain their own public expenditure at least at the level it was at in the preceding period.

For 2000-06, the geographic level at which additionality is checked has been simplified. In the case of Objective 1, this means the totality of eligible regions, and for Objectives 2 and 3 combined, the entire country. Furthermore, the Member States will supply the necessary information to the Commission when the programmes are adopted, at mid term and at the end of the period.

Management, monitoring and evaluation

Under the new Structural Fund rules, the Member States must appoint a managing authority for each programme. Its tasks cover the implementation, correct management and effectiveness of the programme (collection of statistical and financial data, preparation and transmission to the Commission of annual reports, organisation of the mid-term evaluation, etc.).

Monitoring Committees are also set up, which are always the responsibility of the Member States. These Committees, chaired by a representative of the managing authority, ensure the efficiency and quality of the implementation of the structural measures.

The previous three types of evaluation have been kept (ex-ante, mid-term and ex-post), but the reform specifically identifies who is to take responsibility for each. Thus, the ex-ante evaluation is the responsibility of the competent authorities in the Member States, the mid-term evaluation must be carried out by the authority managing the programme in collaboration with the Commission before 31 December 2003, and the ex-post evaluation is the responsibility of the Commission, in collaboration with the Member State and the managing authority. The evaluation reports must be made available to the public.

Payments and financial controls

The Member States and the Commission make a financial contract whereby the Commission undertakes to pay annual commitment appropriations on the basis of the adopted programming documents. Each Member State then appoints a payment authority for each programme to act as intermediary between the final beneficiaries and the Commission. The payment authority, in collaboration with the managing authority, monitors the expenditure of the final beneficiaries and ensures that the Community rules are observed. The physical movement of funds (payment appropriations) from the Union to the Member States actually happens when the Commission reimburses the actual expenditure of the final beneficiaries, approved and certified by the payment authorities.

The increased decentralisation of programme management calls for improved checking arrangements, which are the responsibility of the Member States. The Commission itself ensures the effectiveness of the arrangements set up by the managing and payment authorities. Detailed checks, such as on-the-spot checks and financial audits, must be made on 5 % of expenditure under each programme. When irregularities are found, the Member States are responsible for making financial corrections by cancelling all or part of the financing of the operations concerned. The funds thus released by the Member States can be re-used, those recovered by the Commission are withdrawn and not reusable.

THE CONTRIBUTION OF THE FUNDS: forms and rates of contribution

Most Structural Fund assistance is granted in the form of non-repayable grants or "direct aid", and to a lesser degree refundable aid, interest-rate subsidies, guarantees, equity participation, and participation in venture capital.

The contribution of the Funds is subject to the following ceilings:

  • Objective 1 regions: no more than 75 % of the total eligible cost and, as a general rule, at least 50 % of eligible public expenditure. The Community's contribution rate can be increased to 80 % for the regions located in one of the Member States eligible for assistance from the Cohesion Fund (Greece, Spain, Ireland and Portugal), and to 85 % for all the most remote regions as well as the smaller islands in the Aegean Sea in Greece.
  • Regions eligible under Objective 2 and Objective 3: no more than 50 % of the eligible total cost and, as a general rule, at least 25 % of eligible public expenditure.

Depending on eligibility under the Objectives and the economic and geographical situation of the various regions, the current rules impose different ceilings on contributions from the Funds in the case of investments in firms or infrastructure likely to generate substantial net revenue.

REPORTS ON THE STRUCTURAL FUNDS

Before 1 November each year, the Commission must present a report on the application of the Regulations in the previous year to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions.

The Commission must also present a three-yearly report to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions detailing the progress achieved towards economic and social cohesion and the contribution that structural funding has made to that progress. This report should include:

  • a progress report on the socio-economic situation of the regions;
  • a statement of the role of the structural instruments and other financial instruments, as well as the impact of the other national or Community policies in accomplishing the process;
  • any proposals concerning the Community measures and policies that may need to be adopted to strengthen economic and social cohesion.

Please refer to the datasheets on the latest reports:

FINAL PROVISIONS

The Council will review the current rules on the basis of a proposal from the Commission by 31 December 2006 at the latest.

Regulations (EEC) Nos 2052/88 and 4253/88 were repealed with effect from 1 January 2000.

The Annex to the General Regulation contains the annual allocation of commitment appropriations for the period 2000-06.

Further information on the structural policy reform is available on the websites of the Directorates-General responsible for Employment and Social Policy, Fisheries and Regional Policy.

REFERENCES

ActEntry into forceDeadline for transposition in the Member StatesOfficial Journal
Regulation (EC) No 1260/199929.06.1999
01.01.2000 (Articles 28, 31, 32)
-OJ L 161 of 26.06.1999
Amending act(s)Entry into forceDeadline for transposition in the Member StatesOfficial Journal
Regulation (EC) No 1447/200101.01.2000-OJ L 198 of 21.07.2001
Regulation (EC) No 1105/200327.06.2003-OJ L 158 of 27.06.2003
Regulation (EC) No 173/200522.02.2005-OJ L 29 of 02.02.2005

RELATED ACTS

Council Regulation (EC) No 1083/2006 of 11 July 2006 laying down general provisions on the European Regional Development Fund, the European Social Fund and the Cohesion Fund and repealing Regulation (EC) No 1260/1999 [Official Journal L 210 of 31.7.2006].

ANNUAL REPORTS

The twelfth Annual Report on the Structural Funds (2000)[COM(2001) 539 final - Not published in the Official Journal].

The thirteenth Annual Report on the Structural Funds (2001) [COM(2002) 591 final - Not published in the Official Journal].

The fourteenth Annual Report on the Structural Funds (2002) [COM(2003) 646 final - Not published in the Official Journal].

The fifteenth Annual Report on the implementation of the Structural Funds (2003) [COM(2004) 721 final - Not published in the Official Journal].

The sixteenth Annual Report on the implementation of the Structural Funds (2004) [COM(2005) 533 final - Not published in the Official Journal].

The seventeenth Annual Report on the implementation of the Structural Funds (2005) [COM(2006) 638 final - Not published in the Official Journal].

A) REGIONALISED OBJECTIVES

ELIGIBLE REGIONS

- Objective 1:

Commission Decision 1999/502/EC of 1 July 1999 drawing up the list of regions covered by Objective 1 of the Structural Funds for the period 2000 to 2006 [Official Journal L 194 of 27.07.1999].
This decision determines which NUTS level II regions in Germany, Greece, Spain, France, Ireland, Italy, Austria, Portugal, Finland, Sweden and the United Kingdom are eligible under Objective 1. It also identifies the formerly eligible regions entitled to receive transitional support. Specifically, this concerns certain regions of Belgium, Germany, Spain, France, Ireland, Italy, the Netherlands, Portugal and the United Kingdom.

- Objective 2:

Commission Decision1999/503/EC of 1 July 1999 establishing a population ceiling for each Member State under Objective 2 of the Structural Funds for the period 2000 to 2006 [Official Journal L 194 27.07.1999].
This Decision lays down the population ceilings which must be complied with in determining Objective 2 areas. These ceilings were established on the basis of criteria identified to that end by the General Regulation (18 % of the Community population, but the maximum reduction in the population covered by Objective 2 may not be more than one third compared to the population covered by former Objectives 2 and 5(b), etc).

Commission Decisions drawing up the lists of areas covered by Objective 2 of the Structural Funds for the period 2000-06 in the Member States of the European Union

Member StateDecisionPublication in the Official Journal
GermanyDecision 2000/201/ECOfficial Journal L 66 of 14.03.2000
AustriaDecision 2000/289/EC
(amended by Decision 2000/607/EC)
Official Journal L 99 of 19.04.2000
(Official Journal L 258 of 12.10.2000)
BelgiumDecision 2000/119/ECOfficial Journal L 39 of 14.02.2000
DenmarkDecision 2000/121/ECOfficial Journal L 39 of 14.02.2000
SpainDecision 2000/264/ECOfficial Journal L 84 of 05.04.2000
FinlandDecision 2000/120/ECOfficial Journal L 3 of 14.02.2000
FranceDecision 2000/339/EC
(amended by Decision 2001/202/EC)
(amended by Decision 2003/679/EC)
Official Journal L 123 of 24.05.2000
(Official Journal L 78 of 16.03.2001)
(Official Journal L 249 of 01.10.2001)
ItalyDecision 2000/530/EC
(amended by Decision 2001/363/EC)
Official Journal L 223 of 04.09.2000
(Official Journal L 129 of 11.05.2001)
LuxembourgDecision 2000/277/ECOfficial Journal L 87 of 08.04.2000
NetherlandsDecision 2000/118/ECOfficial Journal L 39 of 14.02.2000
United KingdomDecision 2000/290/EC
(amended by Decision 2001/201/EC)
Official Journal L 99 of 19.04.2000
(Official Journal L 78 of 16.03.2001)
SwedenDecision 2000/220/ECOfficial Journal L 69 of 17.03.2000

ALLOCATION OF FUNDS

Commission Decision 1999/501/EC of 1 July 1999 fixing an indicative allocation by Member State of the commitment appropriations for Objective 1 of the Structural Funds for the period 2000 to 2006 [Official Journal L 194 of 27.07.1999].
This Decision fixes for 2000-06 the indicative amounts of the commitment appropriations for Objective 1 for each Member State (EUR 126 693 million), including the Peace programme (EUR 500 million) and the special programme for the Swedish regions (EUR 350 million) as well as the indicative amounts for transitional support under Objective 1 (EUR 8 411 million).

Commission Decision 1999/504/EC of 1 July 1999 fixing an indicative allocation by Member State of the commitment appropriations for Objective 2 of the Structural Funds for the period 2000 to 2006 [Official Journal L 194 of 27.07.1999].
This Decision fixes the indicative amounts by Member State of the commitment appropriations for Objective 2 (EUR 19 733 million) and the commitment appropriations for transitional support under that Objective (EUR 2 721 million).

Commission Decision 1999/505/EC of 1 July 1999 fixing an indicative allocation by Member State of the commitment appropriations for Objective 3 of the Structural Funds for the period 2000 to 2006 [Official Journal L 194 of 27.07.1999].
This Decision sets out in a table the indicative amounts of the commitment appropriations for Objective 3 for each Member State. These appropriations total EUR 24 050 million in 2000-06.

Commission Decision 1999/500/EC of 1 July 1999 fixing an indicative allocation by Member State of the commitment appropriations under the financial instrument for fisheries guidance (FIFG) outside the Objective 1 regions of the Structural Funds for the period 2000 to 2006 [Official Journal L 194 of 27.07.1999].
This Decision sets out in a table the indicative amounts of the commitment appropriations under the FIFG outside the Objective 1 regions for each Member State. These appropriations total EUR 1 106 million in 2000-06.

GUIDELINES FOR PROGRAMMES UNDER OBJECTIVES 1, 2 AND 3

Commission communication of 1 July 1999 concerning the Structural Funds and their coordination with the Cohesion Fund: Guidelines for the programmes in the period 2000-2006 [COM(1999) 344 final - Official Journal C 267 of 22.09.1999].
This communication sets out guidelines to help the Member States and regions draft their programming documents. To that end it defines the Community priorities which should be reflected in the assistance granted under Objectives 1, 2 and 3. Firstly, it mentions the need to comply with certain general principles enshrined in the Treaty and applicable to all Community policies: sustainable development and equal opportunities.

The communication stresses that development and conversion strategies must be integrated and coherent. The three priorities for assistance under the Structural Funds and the Cohesion Fund are as follows:

  • increasing the competitiveness of regional economies, in order to create sustainable jobs;
  • strengthening social cohesion and employment by upgrading human resources;
  • promoting urban and rural development in the context of a balanced European territory.

For more information, consult the separate datasheet on this communication.

COMMISSION DECISIONS APPROVING THE PROGRAMMES FOR THE REGIONALISED OBJECTIVES [Not published in the Official Journal]

- Objective 1 programmes:

  • Community Support Frameworks (CSFs): Germany, Spain, Greece, Ireland, Italy, Portugal and the United Kingdom (Northern Ireland).
  • Single programming documents (SPDs): Austria (Burgenland), Belgium (Hainault), Finland (Northern and Eastern Finland), France (Réunion, Corsica, French Guiana, Martinique and Nord-Pas-de-Calais), the Netherlands (Flevoland), the United Kingdom (Cornwall and the Scilly Isles, Merseyside, South Yorkshire, the Highlands and Islands, and West Wales and the Valleys), Sweden (Norra Norrland and Södra Skogslän).

- Objective 2 programmes:

  • Single programming documents (SPDs): Germany (Baden-Württenberg, Bavaria, Bremen, Hessen, Lower Saxony, North-RhineWestphalia, Rhineland-Palatinate and Saarland), Austria (Carinthia, Lower Austria, Upper Austria, Salzburg, Styria, Tyrol and Vorarlberg), Belgium (Antwerp, Kustgebied-Westhoek, Limburg and East-Flanders), Denmark, Spain (Aragón, Balearic Islands, Catalonia, Rioja, Madrid, Navarre and the Basque Country) Finland (Western Finland, Southern Finland and the Åland Islands), France (Aquitaine, Alsace, Auvergne, Lower Normandy, Burgundy, Brittany, Centre, Champagne-Ardenne, Franche-Comté, Upper Normandy, Île-de-France, Languedoc-Roussillon, Limousin, Lorraine, Midi-Pyrenees, Nord-Pas-de-Calais, Loire Region, Picardy, Poitou-Charentes, Provence-Alpes-Côte d'Azur and Rhône-Alpes), the United Kingdom (East England, East Midlands, East Wales, Gibraltar, London, North-West England, South-East England, South Scotland, South-West England, East Scotland, West Midlands, Western Scotland and Yorkshire and Humberside), the Netherlands and Sweden (North Sweden, the Islands, South Sweden and West Sweden).

- Objective 3 programmes:

  • Community Support Frameworks (CSFs): Spain, Greece, Ireland, Italy, Portugal and the United Kingdom.
  • Single programming documents (SPD): Germany, Austria, Belgium, Denmark, Finland (Finland and Åland Islands), France, Luxembourg.

Full programming documents for Objectives 1 and 2 are available on the Inforegio website of the Directorate-General for Regional Policy. The documents relating to Objective 3 are on the website of the Directorate-General for Employment and Social Affairs.

B) COMMUNITY INITIATIVES

GUIDELINES FOR THE COMMUNITY INITIATIVES

- INTERREG III:

Communication of 2 September 2004 from the Commission to the Member States laying down guidelines for a Community Initiative concerning trans-European cooperation intended to encourage harmonious and balanced development of the European territory (Interreg III) [Official Journal C 226 of 10.09.2004].
The Commission updates and clarifies the provisions contained in INTERREG III, drawing up a list of the new cooperation areas that result from the enlargement of the European Union.

Communication of 28 April 2000 from the Commission to the Member States laying down guidelines for a Community Initiative concerning trans-European cooperation intended to encourage harmonious and balanced development of the European territory (Interreg III) [Official Journal C 143 of 23.05.2000].
Building on the experience of the two previous phases of Interreg, the Interreg III Initiative comprises three strands:

  • Cross-border cooperation (strand A): promoting integrated regional development between border regions;
  • Transnational cooperation (strand B): contributing to harmonious territorial integration across the European Union and with the applicant countries and other neighbouring countries;
  • Inter-regional cooperation (strand C): improving regional development and cohesion policies and techniques through transnational/interregional cooperation.

Implementation of the Initiative complies with the general objectives of the Structural Funds (creating jobs, improving competitiveness, supporting sustainable development and promoting equal opportunities) and other Community policies.

For the European Union countries Interreg III receives Community funding exclusively under the ERDF (EUR 4 875 million for 2000-06) and for non-member countries participating in the Initiative, under the Phare, Ispa, Sapard, Tacis and Meda programmes.

Communication from the Commission to the Member States of 7 May 2001 - "Interregional cooperation" - Strand C of the Interreg III Community initiative [Official Journal C141 of 15.05.2001].
Following on from the information in the previous communication, this communication specifies that Interreg III C aims to promote exchanges of experience and best practice between regions, more particularly inter-regional cooperation projects.

With an appropriation of EUR 295 million, strand C of Interreg III gives priority to operations involving non-member countries, particularly in the candidate countries, and to island and most remote regions.

- Leader+

Communication of 14 April 2000 from the Commission to the Member States laying down guidelines for the Community Initiative for Rural Development (Leader+) [Official Journal C 139 of 18.05.2000].
The aim of the Leader+ Initiative is to complement the rural development programmes and structural objectives by encouraging those involved in rural communities to think about and implement integrated and innovative development strategies. It is implemented under three headings:

  • Action 1: integrated rural development strategies, of a pilot nature, covering small-sized rural areas with a strong identity;
  • Action 2: cooperation between rural territories in one or more Member States consisting in pooling know-how and human and financial resources;
  • Action 3: the networking of all rural areas to facilitate exchanges of experiences and know-how. Beneficiaries under Leader+ are required to play an active role. At Community level the network is organised by an "Observatory of rural areas".

The Leader+ Initiative has an appropriation of EUR 2 020 million for the period 2000-2006 funded solely by the EAGGF Guidance Section. The Communication also sets out the technical arrangements for preparing, presenting and selecting programmes under the Leader+ Initiative and for managing, controlling, monitoring and evaluating them.

- Equal

Communication of 14 April 2000 from the Commission to the Member States establishing the guidelines for the Community Initiative Equal concerning transnational cooperation to promote new means of combating all forms of discrimination and inequalities in connection with the labour market [Official Journal C 127 of 05.05.2000].
Building on the lessons learned under the previous Employment and Adapt Initiatives, the Equal Initiative seeks to promote a labour market open to all through new means of combating all forms of discrimination and inequality. To that end it covers the whole of the territory of the Union and emphasises the transnational nature of projects, the genuine involvement of local and regional authorities, as well as businesses, and the dissemination of good practice.
Equal provides assistance in four fields based on the four pillars of the European employment strategy:

  • employability,
  • entrepreneurial spirit,
  • capacity for change,
  • equal opportunities.

The Equal Initiative is financed at Community level by the European Social Fund with EUR 2 847 million for 2000-06.

- Urban II

Communication of 28 April 2000 from the Commission to the Member States laying down guidelines for a Community initiative concerning economic and social regeneration of cities and of neighbourhoods in crisis in order to promote sustainable urban development (Urban II) [Official Journal C 141 of 19.05.2000].
The aim of the Urban II Initiative is to promote innovative strategies for economic and social regeneration in deprived urban areas, at the same time facilitating the identification of good practice and exchanges of experience across the European Union. To achieve this, the strategies receiving support under the Initiative must:

  • cover a critical mass of population (not less than 10 000) and offer sufficient support structures and a strong and broad-based partnership to implement innovative and sustainable urban development programmes;
  • present an integrated approach (covering economic, social, transport, environment, security, and other aspects) that is particularly well adapted to promoting equality of access to jobs and training, equal opportunities, and complying with Community environmental requirements at local level;
  • take account of existing strategies for the wider urban area or region, and complement the programmes under the priority Objectives and the other Community Initiatives;
  • maximise the impact and visibility of the selected areas and emphasise the innovative aspects compared to mainstream assistance. The communication lists the types of measure that may be funded under Urban II.

Seventy geographic areas receive support under Urban II. These areas are located within areas eligible under Objectives 1 and 2. Community funding is provided from the ERDF (EUR 700 million for 2000-06).

C) IMPLEMENTATION OF THE STRUCTURAL FUNDS

MANAGEMENT, FOLLOW-UP AND CONTROL METHODS

Commission Regulation (EC) No 438/2001 of 2 March 2001 laying down detailed rules for the implementation of Council Regulation (EC) No 1260/1999 as regards the management and control systems for assistance granted under the Structural Funds [Official Journal L 63 of 03.03.2001].
The financial management of the Structural Funds has been further decentralised for the 2000-06 programming period, and the Member States and regions have new responsibilities. The Member States appoint the managing and payment authorities for each programme. The Regulation stipulates the role of each of the parties involved in managing, monitoring and checking the funds entrusted to it. Please refer to the separate datasheet.

Commission Regulation (EC) No 448/2001 of 2 March 2001 laying down detailed rules for the implementation of Council Regulation (EC) No 1260/1999 as regards the procedure for making financial corrections to assistance granted under the Structural Funds [Official Journal L 64 of 06.03.2001].
This Regulation lays down the procedure for recovering all or part of the Community contribution under the Structural Funds in the event of ineligibility, poor management or inadequate checks. From 5 % to 100 % of the aid granted can be recovered, depending on the seriousness of the shortcoming. Please refer to the separate datasheet.

PUBLICITY

Commission Regulation (EC) No 1159/2000 of 30 May 2000 on information and publicity measures to be carried out by the Member States concerning assistance from the Structural Funds [Official Journal L 130 of 31.05.2000].
Structural Fund assistance (ERDF, ESF, EAGGF Guidance Section and FIFG) must be accompanied by publicity measures which, with the aim of transparency, inform potential and final beneficiaries of the possibilities offered by the Funds and inform the general public about the role played by the European Union in cooperation with the Member States in this area.
The Community support frameworks (CSFs), operational programmes (OPs), single programming documents (SPDs) and Community Initiative programmes (CIPs) must provide for a communication plan as a framework for information and publicity measures. Such schemes (e.g. billboards, commemorative plaques, posters, information and communication material and information events) are the responsibility of the authority managing the programme. At Community level the Commission will encourage exchanges of experience and the development of informal networks among those responsible for providing information.

ELIGIBILITY OF EXPENDITURE

Commission Regulation (EC) No 1685/2000 of 28 July 2000 laying down detailed rules for the implementation of Council Regulation (EC) No 1260/1999 as regards eligibility of expenditure of operations co-financed by the Structural Funds [Official Journal L 193 of 27.07.2000].
This Regulation lays down common rules on the eligibility of expenditure of certain operations part-financed by the Structural Funds. Please refer to the separate datasheet.

FINANCIAL PROCEDURES

Communication from the Commission to the European Parliament and the Council - The respective responsibilities of the Member States and the Commission in the shared management of the Structural Funds and the Cohesion Fund - Current situation and outlook for the new programming period after 2006 [COM(2004) 580 final - Not published in the Official Journal].

Communication C(2002) 1942 from the Commission on the application of the n+2 rule under Article 31(2) of Regulation (EC) No 1260/1999 (Structural Funds).
This communication fixes the general framework of application of the n+2 rule and aims to clarify the principal subjects relating to the automatic decommitment in order to make the rule operational before the date of its first application on 31 December 2002. The general rule, with exceptions in certain cases, states that the Commission must automatically decommit any part of a commitment for which it has not received an acceptable payment application by the end of the second year following the year of commitment. More detailed provisions relate to the date of application of the rule, transfers between Funds or programmes, incidences of decommitted amounts being reused (error due solely to the Commission, cases of force majeure due to a serious natural disaster) and any legal procedures or administrative appeals leading to delays in payment.

Amended by:
Commission Communication C(2003) 2982 on the application of the "n+2 rule" in regulation (EC) No 1260/1999
This revised communication cancels the suspension of payments that operated until the Commission received and approved a revised financing plan after the decommitment in accordance with the n+2 rule. The part of the commitment of which the automatic decommitment is being discussed is blocked. If the Member State provides the Commission with justification which leads it to reduce the blocked amount, the amounts not yet decommitted are unblocked and made available again for subsequent payment requests. The text also defines force majeure, and stipulates that payment claims may be submitted up until 31 December inclusive.

Commission Decision C(2002) 1870 on the automatic decommitment of Structural Funds for multi-fund programmes in the period 2000-2006.
This decision gives details of the application of the automatic decommitment according to the n+2 rule (n= the year of commitment) for multi-fund programmes. For programmes of this kind, it is sometimes inevitable that the commitments made under different Funds should take place on different dates, and consequently be affected by the n+2 rule on different dates. The Commission has decided that the automatic decommitment should be based on the date of the latest commitment.

Communication of 20.09.2002 from the Commission to the Council and the European Parliament: Evolution of budget execution of the Structural Funds, in particular outstanding commitments (R.A.L.) [COM(2002) 528 final].
There is always a delay between the launching of an aid measure and the first payments, especially in the case of infrastructure projects. At a given moment the outstanding commitments (restant à liquider or RAL) comprise all the commitments approved but not yet paid but which would normally be paid in the future. This communication notes that there was an under-execution of payment appropriations in the budgets for the 2000, 2001 and 2002 exercises. An initial analysis of the reasons for the slow start-up of 2000-06 programmes focuses on two phenomena: the overlap of two programming periods in 2000 and 2001, and the over-estimation of payment appropriations by the Member States. The Commission undertakes to continue its efforts to simplify procedures and assess the impact of the application of the n+2 rule on programme management.

STATISTICS

Regulation (EC) No 1059/2003 of the European Parliament and of the Council of 26 May 2003 on the establishment of a common classification of Territorial Units for Statistics (NUTS) [Official Journal L 154 of 21.06.2003].
In order to ensure that the regional statistics complied and disseminated at Community level are comparable, this Regulation introduces a common statistical classification of territorial units (NUTS). Each region (or administrative unit) is given a code and a specific name. Three hierarchical NUTS levels are used to classify regions on the basis of population brackets within which the average size of the regions must be situated:

  • 3 million < NUTS 1 < 7 million
  • 800 000 < NUTS 2 < 3 million
  • 150 000 < NUTS 3 < 800 000
Last updated: 22.01.2007
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