Protocol on the financial consequences of the expiry of the ECSC Treaty and on the Research Fund for Coal and Steel

KEY POINTS

The European Commission wound up the financial operations of the European Coal and Steel Community when the European Coal and Steel Community Treaty expired in 2002. The assets and liabilities are referred to as ‘European Coal and Steel Community in liquidation (ECSC i.l.)’. On completion of the liquidation, the assets will be referred to as ‘assets of the Research Fund for Coal and Steel’.

Losses

• The Commission, before writing off any claim against a debtor who has defaulted, explores other possible remedies such as calling on guarantees (mortgages, cautions, bank guarantees or others).
• The Commission does not need to exhaust all possible remedies where:
  • the cost of recovery would be greater than the sum involved, and the image of the European Union (EU) would not be damaged;
  • the claim cannot be recovered because the debtor is insolvent;
  • recovery is inconsistent with the principle of proportionality.

Assets

• The Commission manages the assets in a way that guarantees the Research Fund for Coal and Steel programme €111 million per year until 2027. The amount is divided into:
  • €40 million for collaborative research in the coal and steel sectors;
  • €71 million for breakthrough technologies leading to near-zero-carbon steelmaking and for research projects to manage closed or closing coal mines in line with the Just Transition Fund.
• After 2027, the Commission will invest the assets to ensure a long-term return and, where possible, increase their value.
• The annual €111 million funding comes from the net revenue of the investments and, if this is insufficient, from the sale of part of the assets.

Budget

• A profit and loss account, balance sheet and financial report are drawn up annually, separately from the EU’s other financial operations.
• The net revenue from investments and any income from the sale of assets are treated as revenue in the general EU budget, but are earmarked for the specific purpose of financing coal and steel research.
• That revenue is shared between research on coal (27.2%) and steel (72.8%). EU Member States may unanimously agree to change that breakdown.
• Unused funding is carried over to the following year.
• The Commission covers all administrative expenditure involved in liquidation, investment and management activity from the EU’s general budget.