Council Decision (EU, Euratom) 2020/2053 on the system of own resources of the European Union

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Series Details L 424, Pages 1-10
Publication Date 15/12/2020
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Summary:

Decision (EU, Euratom) 2020/2053 - adopted by the Council of the European Union on 14 December 2020 - laying down rules on the allocation of Own Resources to the European Union (EU). It is also known as the ORD Decision. It repeals Decision 2014/335/EU, Euratom.

Further information:

The EU's own resources are the main sources of revenue for the EU Budget.

This Decision raises the maximum amount of resources that can be called from Member States in any given year to finance EU expenditure (the own-resources ceiling) from 1.20% to 1.40% of the sum of the EU27 GNI. This reflects the integration of the European Development Fund (EDF) into the EU Budget and addresses the withdrawal of the United Kingdom (UK) from the EU. The Decision also authorises the European Commission to borrow up to €750 billion (2018 prices) on the capital markets, in the framework of the EU Recovery Instrument (also known as NextGenerationEU - NGEU). The own-resources ceiling is also temporarily increased by a further 0.6% to cover liabilities of the EU resulting from this borrowing.

The original proposal for this Decision was tabled by the European Commission on 2 May 2018 in the context of the legislative package for the Multiannual Financial Framework (MFF) 2021-2027. As a result of the COVID-19 (coronavirus) pandemic, the Commission adopted its Europe's Recovery Plan, which included a revamped legislative package for the MFF 2021-2027 and the temporary EU Recovery Instrument. As a result, the proposed ORD Decision was also amended to address the investment needs foreseen in the recovery strategy.

The amended Decision was tabled by the European Commission on 27 May 2020. A political agreement on the terms of the Recovery Plan was reached at a European Council meeting in July 2020. The European Parliament threatened not to endorse the agreed terms for the MFF 2021-2027 unless there was an overhaul of the own resources system. Its plenary adopted a legislative opinion on the proposed ORD Decision on 16 September 2020. Negotiations between the co-legislators on the MFF were successfully concluded on 10 November, which included the incorporation of a roadmap for new own resources. The Council of the European Union adopted the proposed ORD Decision on 14 December 2020. The Act was published in the Official Journal on 15 December 2020.

The Own Resources Decision needs to be ratified by all Member States before it can enter into force. In late March 2021, Germany's Constitutional Court instructed the country's President not to ratify the Decision, following a constitutional complaint against German participation in the EU Recovery Instrument. This bid was eventually declined the Court on 21 April, clearing the way for the national ratification of this Decision. Media outlets later reported on potential difficulties with Finland's ratification process.

Source Link http://data.europa.eu/eli/dec/2020/2053/oj
Related Link(s)
Commentary and Analysis
EPRS: Briefing, February 2021: Own resources of the European Union: Reforming the EU's financing system https://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_BRI(2018)630265
Euronews, 30/03/2021: The German Constitutional Court has blocked the EU's recovery fund. What happens now? https://www.euronews.com/2021/03/30/the-german-constitutional-court-has-blocked-the-eu-s-recovery-fund-what-happens-now
Euro|topics, March 2021: Europe flabbergasted after top German court halts recovery fund https://www.eurotopics.net/en/258749/
Carnegie Europe: Strategic Europe, 01/04/2021: Judy Asks: Will the EU Recovery Fund Happen? https://carnegieeurope.eu/strategiceurope/84231
European Policy Centre: Commentary, 07/04/2021: Why the German Constitutional Court will (probably) not kill the €750 bn EU recovery fund https://www.epc.eu/en/Publications/Why-the-German-Constitutional-Court-will-probably-not-kill-the-750~3d5ef0
EU Law Analysis, 14/04/2021: The Own Resources Decision as an Ultra Vires Act or a Violation of Constitutional Identity? An analysis of possible procedural scenarios http://eulawanalysis.blogspot.com/2021/04/the-own-resources-decision-as-ultra.html
European Law Blog, 14/04/2021: Corona Reconstruction Fund stopped for the time being https://europeanlawblog.eu/2021/04/14/corona-reconstruction-fund-stopped-for-the-time-being/
FIPRA: FIPRA Network, 27/04/2021: Finnish lawmakers decide on a two-third majority to pass the EU stimulus fund https://fipra.com/update/finnish-lawmakers-decide-on-a-two-third-majority-to-pass-the-eu-stimulus-fund/
Verfassungsblog, 27/04/2021: A Relieving Decision: The Interim Decision of the German Federal Constitutional Court in the Procedure against the 2020 Own Resources Decision https://verfassungsblog.de/a-relieving-decision/
EPRS: Briefing, May 2021: National ratification of the Own Resources Decision: State of play on 18 March 2021 https://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_BRI(2021)690520

News
EurActiv, 18/06/2020: No consent to ‘historic’ recovery plan without new revenues, MEPs warn https://www.euractiv.com/section/economy-jobs/news/no-consent-to-historic-recovery-plan-without-new-revenues-meps-warn/
Reuters, 16/09/2020: European Parliament votes for new taxes in EU to repay recovery borrowing https://www.reuters.com/article/idUSKBN26732U
Kathimerini, 12/02/2021: EU eyes spending first recovery funds before the end of summer https://www.ekathimerini.com/news/262324/eu-eyes-spending-first-recovery-funds-before-the-end-of-summer/
Reuters, 26/03/2021: German constitutional court stops ratification of EU recovery fund https://www.reuters.com/article/idUSKBN2BI2FR
Deutsche Welle, 26/03/2021: Germany's top court suspends ratification of EU recovery fund https://p.dw.com/p/3rF4o
Politico, 26/03/2021: Constitutional complaint against EU recovery fund filed in Germany https://www.politico.eu/article/constitutional-complaint-against-eu-coronavirus-recovery-fund-filed-in-germany/
Times of Malta, 29/03/2021: EU sees fast fix to German court setback on €750 billion virus fund https://timesofmalta.com/articles/view/eu-sees-fast-fix-to-german-court-setback-on-750-billion-virus-fund.861298
Kathimerini, 30/03/2021: EU rescue funds agreement compatible with EU treaties, ECB’s de Cos says https://www.ekathimerini.com/economy/1158183/eu-rescue-funds-agreement-compatible-with-eu-treaties-ecb-s-de-cos-says/
The Local (France), 02/04/2021: France takes aim at Germany and other EU states for not ratifying Covid fund https://www.thelocal.fr/20210402/france-complains-about-delay-in-eu-germany-virus-fund-ratification/
Euronews, 14/04/2021: 'Time is of the essence': EU budget chief urges countries to ratify recovery fund https://www.euronews.com/2021/04/14/time-is-of-the-essence-eu-budget-chief-urges-countries-to-ratify-recovery-fund
EurActiv, 16/04/2021: Approving EU recovery package in Finland proves more difficult than expected https://www.euractiv.com/section/politics/short_news/approving-eu-recovery-package-in-finland-proves-more-difficult-than-expected/
Politico, 21/04/2021: German court rejects bid to block EU recovery fund https://www.politico.eu/article/german-court-rejects-bid-to-block-eu-recovery-fund/
Deutsche Welle, 21/04/2021: Top German court tosses objection to EU coronavirus recovery fund https://p.dw.com/p/3sJn4
YLE News, 27/04/2021: EU stimulus faces new obstacle in Finland with super majority required https://yle.fi/uutiset/osasto/news/eu_stimulus_faces_new_obstacle_in_finland_with_super_majority_required/11903653
Helsinki Times, 29/04/2021: Possibility of Finland rejecting EU’s recovery plan met with calm https://www.helsinkitimes.fi/finland/finland-news/domestic/19140-possibility-of-finland-rejecting-eu-s-recovery-plan-met-with-calm.html
YLE News, 01/05/2021: EU leaders show concern over Finland's vote on stimulus package https://yle.fi/uutiset/osasto/news/eu_leaders_show_concern_over_finlands_vote_on_stimulus_package/11910644
Reuters, 10/05/2021: Finland set to pass EU recovery plan as opposition party backs government https://www.reuters.com/article/idUSL8N2MX349

Official
EUR-LEX: Glossary of Summaries: Own Resources https://eur-lex.europa.eu/summary/glossary/community_own_resources.html
European Commission: MFF 2021-2027: Own resources https://ec.europa.eu/info/strategy/eu-budget/long-term-eu-budget/2021-2027/revenue/own-resources_en
European Parliament: Factsheets: The Union's Revenue https://www.europarl.europa.eu/factsheets/en/sheet/27/the-union-s-revenue
EUR-LEX: COM(2018)325: Proposal for a Council Decision on the system of Own Resources of the European Union https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=COM:2018:325:FIN
EUR-LEX: SWD(2018)172: Staff Working Document accompanying the Proposal - Financing the EU budget: report on the operation of the own resources system https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=SWD:2018:172:FIN
EUR-LEX: COM(2020)445: Amended Proposal for a Council Decision on the system of Own Resources of the European Union https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=COM:2020:445:FIN
European Parliament: Legislative Observatory: Procedure File for Proposal on System of own resources of the European Union (2018/0135(CNS)) https://oeil.secure.europarl.europa.eu/oeil/popups/ficheprocedure.do?reference=2018/0135(CNS)
European Parliament: Legislative Train Schedule: Legislative Package for the System of Own Resources of the European Union after 2020 https://www.europarl.europa.eu/legislative-train/theme-an-economy-that-works-for-people/file-mff-post-2020-own-resources/03-2021
Council of the European Union: Press Release, 14/12/2020: Next multiannual financial framework and recovery package: Council moves to finalise adoption https://www.consilium.europa.eu/en/press/press-releases/2020/12/14/next-multiannual-financial-framework-and-recovery-package-council-moves-to-finalise-adoption/
EPP Group: Newsroom, 22/02/2021: National parliaments need to ratify financing of Recovery Fund https://www.eppgroup.eu/newsroom/news/parliaments-need-to-ratify-financing-of-recovery-fund
German Federal Constitutional Court: Press Release No 29/2021, 21/04/2021: Unsuccessful application for preliminary injunction against promulgation of the domestic act ratifying the EU Own Resources Decision (‘EU Recovery Package’) https://www.bundesverfassungsgericht.de/SharedDocs/Pressemitteilungen/EN/2021/bvg21-029.html

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