The Financial Regulation of the European Union is, in the words of the European Commission, the ‘pivotal point of reference for the principles and procedures governing the establishment and implementation of the EU Budget and control of [the Union’s] finances’. The regulation defines in more detail than the Treaties certain general principles that shape the Budget, notably unity, ‘annuality’, transparency and sound financial management. It clarifies the operation of the EU budgetary process and the structure and presentation of the Budget, as well as the rules for authorisation, procurement, grant-making and accounting by the Union’s institutions, bodies and agencies. Article 1 of the regulation treats several bodies – the European Economic and Social Committee (EESC), the Committee of the Regions, the Ombudsman and the European Data Protection Supervisor (EDPS) – as if they are institutions for the purposes of the regulation. A separate section sets down specific arrangements for spending in some of the EU’s individual policy areas, notably in respect of the Common Agricultural Policy (CAP) and the structural funds.
The legal form of the Financial Regulation is, as its name suggests, one of a regulation. The 2001 Nice Treaty provided that, starting in 2007, the measure could be adopted by qualified majority voting (QMV), rather than unanimity, in the Council of Ministers (Article 279 EC). Under the Lisbon Treaty, the co-decision procedure between the Council and Parliament now also applies (Article 322 TFEU). This is the basis on which the latest Financial Regulation was agreed in June 2012 (the previous texts having been passed in December 1977 and June 2002). Implementing rules for the Financial Regulation are adopted by the Commission every three years, using the comitology process. These clarify and up-date specific procedures relating to, for example, the obligations of authorising and accounting officers in the spending of EU funds.
Copyright: Anthony Teasdale, 2012
Citation: The Penguin Companion to European Union (2012), additional website entry