EU budget: how its own resources system is implemented

 

SUMMARY OF:

Regulation (EU, Euratom) No 608/2014 on implementing the EU own resources system

WHAT IS THE AIM OF THE REGULATION?

• It establishes certain rules for implementing the EU's own resources system set out in Council Decision 2014/335/EU, Euratom — EU's own resources.
• It contains rules for:
  • the calculation and budgeting of the balances*,
  • their control and supervision, and
  • reporting requirements for national authorities.
• It is complemented by Regulation (EU, Euratom) No 609/2014 which sets out the methods and procedures for making own resources available to the European Commission.

KEY POINTS

The EU's own resources provide its main revenue. EU annual expenditure must be completely covered by its annual revenue.

There are 3 types of own resources:

• 1.

  Traditional own resources consisting mainly of customs duties on imports from outside the EU and sugar levies. EU countries keep 25% of the amounts as collection costs.

• 2.

  Own resources based on value added tax (VAT) — a uniform rate of 0.3% is levied on the EU-wide standard VAT base of each EU country.

• 3.

  Own resources based on gross national income (GNI) — each EU country transfers a standard percentage of its GNI to the EU.

Control and supervision

Concerning traditional own resources, EU countries must:

• conduct checks and enquiries regarding the establishment and the making available of those own resources
• carry out additional inspection measures at the Commission's request

The Commission may involve itself in these inspections and may also carry out its own spot checks.

Concerning own resources based on GNI, the Commission must:

• inspect certain estimates, calculations and statistical bases used by individual EU countries
• have access to certain statistical procedures and basic statistics.

Commission inspections

• The regulation authorises the Commission to appoint officials to carry out its inspections.
• Information obtained is subject to professional secrecy and personal data is protected by the national law of the country being inspected as well as relevant EU data protection laws.
• Results of inspections carried out by the Commission's agents must be given to the EU country in question within 3 months.

Reports

EU countries are required to:

• send the Commission a description of cases of fraud or irregularities concerning traditional own resources involving entitlements exceeding €10,000
• submit detailed annual reports to the Commission on their inspections relating to traditional own resources including the results and the overall data.

The Commission produces:

• a summary report for the EU countries based on the annual reports they provide
• a report to the Council and the European Parliament every 3 years on the functioning of the inspection arrangements for traditional own resources.

FROM WHEN DOES THE REGULATION APPLY?

It has applied since 1 January 2014.

BACKGROUND

For more information, see:

• EU budget own resources (European Commission)
• The high-level group on own resources (European Commission)

KEY TERMS

MAIN DOCUMENT

Council Regulation (EU, Euratom) No 608/2014 of 26 May 2014 laying down implementing measures for the system of own resources of the European Union (OJ L 168, 7.6.2014, pp. 29-38)

RELATED DOCUMENTS

Council Decision 2014/335/EU, Euratom of 26 May 2014 on the system of own resources of the European Union (OJ L 168, 7.6.2014, pp. 105-111)

Council Regulation (EU, Euratom) No 609/2014 of 26 May 2014 on the methods and procedure for making available the traditional, VAT and GNI-based own resources and on the measures to meet cash requirements (Recast) (OJ L 168, 7.6.2014, pp. 39-52)

Successive amendments to Regulation (EU, Euratom) No 609/2014 have been incorporated in the original text. This consolidated version is of documentary value only.

last update 28.02.2019