11970F/MOD/02

Article 2

The following provisions shall be added to the Treaty establishing the European Coal and Steel Community:

»Article 78a

By way of derogation from the provisions of Article 78, the following provisions shall apply to budgets for financial years preceding the financial year 1975:

1. The financial year shall run from 1 January to 31 December.

The administrative expenditure of the Community shall comprise the expenditure of the High Authority, including that relating to the functioning of the Consultative Committee, and that of the Court, the European Parliament and the Council.

2. Each institution of the Community shall, before 1 July, draw up estimates of its administrative expenditure. The High Authority shall consolidate these estimates in a preliminary draft administrative budget. It shall attach thereto an opinion which may obtain different estimates.

The preliminary draft budget shall contain an estimate of revenue and an estimate of expenditure.

3. The High Authority shall place the preliminary draft administrative budget before the Council not later than 1 September of the year preceding that in which the budget is to be implemented.

The Council shall consult the High Authority and, where appropriate, the other institutions concerned whenever it intends to depart from the preliminary draft budget.

The Council shall, acting by a qualified majority, establish the draft administrative budget and forward it to the European Parliament.

4. The draft administrative budget shall be placed before the European Parliament not later than 5 October of the year preceding that which the budget is to be implemented.

The European Parliament shall have the right to propose to the Council modifications to the draft budget.

If, within 45 days of the draft administrative budget being placed before it, the European Parliament has given its approval or has given its approval or has not proposed any modifications to the draft budget, the administrative budget shall be deemed to be finally adopted.

If within this period the European Parliament has proposed modifications, the draft administrative budget together with the proposed modifications shall be forwarded to the Council.

5. The Council shall, after discussing the draft administrative budget with the High Authority and, where appropriate, with the other institutions concerned, adopt the administrative budget, within 30 days of the draft budget being placed before it, under the following conditions.

Where a modification proposed by the European Parliament does not have the effect of increasing the total amount of the expenditure of an institution, owing in particular to the fact that the increase in expenditure which it would involve would be expressly compensated by one or more proposed modifications correspondingly reducing expenditure, the Council may, acting by a qualified majority, reject the proposed modification. In the absence of a decision to reject it, the proposal modification shall stand as accepted.

Where a modification proposed by the European Parliament has the effect of increasing the total amount of the expenditure of an institution, the Council must act by a qualified majority in accepting the proposed modifications.

Where, in pursuance of the second or third subparagraphs of this paragraph, the Council has rejected or has not accepted a proposed modification, it may, acting by a qualified majority, either retain the amount shown in the draft administrative budget or fix another amount.

6. When the procedure provided for in this Article has been completed, the President of the Council shall declare that the administrative budget has been finally adopted.

7. Each institution shall exercise the powers conferred upon it by this Article, with due regard for the provisions of this Treaty and for acts adopted in accordance therewith, in particular those relating to the Communities' own resources and to the balance between revenue and expenditure.

8. Final adoption of the administrative budget shall have the effect of authorizing and requiring the High Authority to collect the corresponding revenue in accordance with the provisions of Article 49.«