EXPLANATORY MEMORANDUM

1.CONTEXT OF THE PROPOSAL

•Reasons for and objectives of the proposal

The ‘Agreement on cooperation in science and technology between the European Community and Ukraine’ 1 (‘the Agreement’) was signed in Copenhagen on 4 July 2002 and was concluded for an initial period ending 31 December 2002. Point (b) of Article 12 of the Agreement provides for a possibility of renewal by common agreement between the Parties for additional periods of five years. The Agreement has been renewed two times in 2011 2 and 2014 3 .

The Agreement expired on 7 November 2019.

The renewal of the Agreement for an additional period of five years is in the mutual interest of both Parties to the Agreement in order to continue facilitating cooperation between EU and Ukraine in common science and technology (S&T) priority areas leading to mutual benefits.

Ukraine has a long tradition of science and technology excellence and despite the difficulties of the last years, the country has still first class science and scientists, and is an important science, technology and innovation (STI) actor in the neighbourhood of the Union. Cooperation between the Union and Ukraine has traditionally been very active notably in the fields of advanced/new materials, IT-technology, physics and astronomy, engeering, agricultural technology, nanotechnology, biotechnology and their applications across various sectors such as aviation, energy, and biomedicine, in particular immunotherapies for cancer.

At the meeting of the EU-Ukraine Joint Science and Technology Cooperation Committee, established under the Agreement, held in Kyiv on 29 January 2019, both Parties took note of their intention to renew the Agreement for an additional period of five years, recognising the progress made to enhance EU-Ukraine cooperation in research and innovation. The Government of Ukraine has already started the renewal process on their side.

The substance of the renewed Agreement will be identical to that of the content of the current Agreement. The renewed Agreement will not create new or additional rights and obligations for either of the Parties, but instead it will extend in time the legal regime already existing between the Parties in the field of S&T cooperation

•Consistency with existing policy provisions in the policy area

This initiative is fully in line with with the EU’s international cooperation strategy for research and innovation 4 , in addition, with the international outreach of the previous and the new Commission, whereby Ukraine is a strategic partner of the EU in research and innovation.

The Agreement is also a means of implementing the EU’s international cooperation strategy for research and innovation, which calls for more internationalisation and openness in the EU’s research and innovation landscape.

This Agreement is complementary to the Horizon 2020 Association Agreement, which focuses specifically on terms and conditions of Ukrainian participation in the Horizon 2020 Programme. The renewal of this S&T Agreement would allow to keep the general overarching legal framework for bilateral STI cooperation and would send an important political signal about the importance, which the EU attaches to cooperation with Ukraine on STI.

• Consistency with other Union policies

The EU’s global strategy for the EU’s foreign and security policy confirms that research cooperation is an important aspect of EU foreign policy and sees research cooperation as an essential element of stronger socioeconomic ties.

2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY

•Legal basis

The EU’s power to act internationally in research and technological development is based on Article 186 TFEU. The procedural legal basis for the proposal is point (a)(v) of the second subparagraph of Article 218(6) TFEU.

•Subsidiarity (for non-exclusive competence)

The EU and its Members States have parallel competence in the area of research and technological development in accordance with Article 4(3) TFEU. Therefore EU's action cannot be replaced by action of Member States.

3.RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS

•Regulatory fitness and simplification

This initiative is not part of the REFIT agenda.

4.BUDGETARY IMPLICATIONS

Only human and administrative resources are required; these are set out in the legislative financial statement.

In the light of the above considerations, the Commission requests that the Council:

– approves, on behalf of the Union, and with the consent of the European Parliament, the renewal of the Agreement on cooperation in science and technology between the European Community and Ukraine, for an additional period of five years (i.e., from 09/11/2019 until 08/11/2024); and

– authorises the President of the Council to designate the person(s) empowered to notify the Government of Ukraine that the Union has completed the internal procedures necessary for the entry into force of this renewed Agreement.

2020/0016 (NLE)

Proposal for a

COUNCIL DECISION

on the renewal of the Agreement on cooperation in science and technology between the European Community and Ukraine

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 186 in conjunction with point (a)(v) of Article 218(6) thereof,

Having regard to the proposal from the European Commission,

Having regard to the consent of the European Parliament 5 ,

Whereas:

(1)By Decision 2003/96/EC 6 of 6 February 2003, the Council approved the conclusion of the Agreement on cooperation in science and technology between the European Community and Ukraine 7 (‘the Agreement’). The Agreement was signed in Copenhagen on 4 July 2002 and entered into force on 11 February 2003.

(2)Point (b) of Article 12 of the Agreement provided that the Agreement would be concluded for an initial period ending on 31 December 2002 and would be renewable by common agreement between the Union and Ukraine (‘the Parties’) for additional periods of five years.

(3)Based on Decisions 2011/182/EU 8 and (EU) 2015/344 9 the Agreement was renewed for additional periods of five years each time, with a retroactive effect as of 8 November 2009 and 8 November 2014, respectively. The Agreement expired on 7 November 2019.

(4)Ukraine is an important science, technology and innovation (STI) actor in the neighbourhood of the Union. In order to continue facilitating cooperation in common science and technology (S&T) priority areas both Parties consider that the renewal of this Agreement would be in their mutual interest.

(5)Both Parties confirmed their intention to renew the Agreement for an additional period of five years. The content of the renewed Agreement should remain identical to the content of the Agreement.

(6)The renewal of the Agreement should therefore be approved on behalf of the Union,

HAS ADOPTED THIS DECISION:

Article 1

The renewal of the Agreement on cooperation in science and technology between the European Community and Ukraine for an additional period of five years, is hereby approved on behalf of the Union. The renewal shall take effect on 8 November 2019.

Article 2

The President of the Council is hereby authorised to designate the person(s) empowered, acting on behalf of the Union and in accordance with point (a) of Article 12 of the Agreement, to notify Ukraine that the Union has completed its internal procedures necessary for the entry into force of this renewed Agreement.

Article 3

This Decision shall enter into force on the day of its adoption.

Article 4

The decision shall be published in the Official Journal of the European Union.

Done at Brussels,

For the Council

The President

LEGISLATIVE FINANCIAL STATEMENT

1.FRAMEWORK OF THE PROPOSAL/INITIATIVE

1.1.Title of the proposal/initiative

1.2.Policy area(s) concerned in the ABM/ABB structure

1.3.Nature of the proposal/initiative

1.4.Objective(s)

1.5.Grounds for the proposal/initiative

1.6.Duration and financial impact

1.7.Management mode(s) planned

2.MANAGEMENT MEASURES

2.1.Monitoring and reporting rules

2.2.Management and control system

2.3.Measures to prevent fraud and irregularities

3.ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE

3.1.Heading(s) of the multiannual financial framework and expenditure budget line(s) affected

3.2.Estimated impact on expenditure

3.2.1.Summary of estimated impact on expenditure

3.2.2.Estimated impact on operational appropriations

3.2.3.Estimated impact on appropriations of an administrative nature

3.2.4.Compatibility with the current multiannual financial framework

3.2.5.Third-party contributions

3.3.Estimated impact on revenue

LEGISLATIVE FINANCIAL STATEMENT

1.FRAMEWORK OF THE PROPOSAL/INITIATIVE

1.1.Title of the proposal/initiative

Proposal for a Council Decision concerning the renewal of the Agreement on cooperation in science and technology between the European Community and Ukraine.

1.2.Policy area(s) concerned in the ABM/ABB structure 10

Policy strategy and coordination of, in particular, the Secretariat-General, Legal Service, the EEAS the Directorates-General, AGRI, BUDG, CLIMA, CNECT, EAC, ENER, GROW, JRC, MARE and MOVE

1.3.Nature of the proposal/initiative

◻ The proposal/initiative relates to a new action

◻ The proposal/initiative relates to a new action following a pilot project/preparatory action 11

☑ The proposal/initiative relates to the extension of an existing action

◻ The proposal/initiative relates to an action redirected towards a new action

1.4.Objective(s)

1.4.1.The Commission's multiannual strategic objective(s) targeted by the proposal/initiative

The present initiative will allow both Parties to improve and intensify their cooperation in scientific and technological areas of common interest. At the meeting of the EU-Ukraine Joint Science and Technology Cooperation Committee, established by the Agreement, held in Kyiv on 29 January 2019, both Parties took note of their intention to renew the Agreement, for an additional period of five years.

1.4.2.Specific objective(s) and ABM/ABB activity(ies) concerned

Specific objective No

This decision will allow both Parties to enhance the cooperation and develop a more strategic partnership by increasing the scale and scope of existing cooperation, addressing global challenges by promoting reciprocal access to programmes and funding.

ABM/ABB activity(ies) concerned

Expected result(s) and impact

Specify the effects which the proposal/initiative should have on the beneficiaries/groups targeted.

This decision will allow both the EU and Ukraine to mutually gain benefit from the scientific and technical progress achieved through ongoing cooperation activities. It will allow for exchange of specific knowledge and transfer of know-how to the benefit of the scientific community, industry and citizens of both Parties.

1.4.3.Indicators of results and impact

Specify the indicators for monitoring implementation of the proposal/initiative.

The Commission will regularly monitor all actions carried out under the Agreement, including cooperation activities. This evaluation will cover, among others, the following points:

(a) cooperation indicators – analysis of the number and type of participation of Ukrainian entities in EU funded programmes (e.g. number of proposals, number of signed grant agreements, main collaboration links, main thematic; generated output) and vice-versa (whenever the data is available);

(b) performance indicators – success rate of Ukrainian entities participating in the EU framework programmes compared to other non-EU countries and to Member States; analysis of the quality of the participation (e.g. number of best ranked universities taking part on the programme, number of patents and publications coming from collaborative projects);

(c) data collection regarding cooperation activities and links that go beyond the respective research funding programmes as well as assessment of the impact of these activities, like participation in multilateral initiatives and working groups.

1.5.Grounds for the proposal/initiative

1.5.1.Requirement(s) to be met in the short or long term

This decision will allow the two Parties to continue to improve and intensify their cooperation in scientific and technological areas for mutual benefit.

1.5.2.Added value of EU involvement

Cooperation in research & innovation between the EU and the Ukraine has been intensifying steadily over the past years. The involvement of the EU allows for activities with larger scale and scope for the benefit of all Member States. The renewal of the Agreement will allow the EU to have better access to scientific knowledge produced in the Ukraine and to engage in more cooperation activities leading to additional exchange of knowledge and technologies.

1.5.3.Lessons learned from similar experiences in the past

Based on the experience so far in scientific and technological cooperation, it is considered mutually beneficial to continue research cooperation with Ukraine, as a strategic partner of the EU in research and innovation.

1.5.4.Compatibility and possible synergy with other appropriate instruments

The renewal of the Agreement with the Ukraine is considered to be fully consistent with the overall policy framework on international cooperation in research and innovation (COM(2012) 497).

1.6.Duration and financial impact

☑ Proposal/initiative of limited duration

–☑ Proposal/initiative in effect from [DD/MM]YYYY to [DD/MM]YYYY

–☑ Financial impact from YYYY to YYYY

◻ Proposal/initiative of unlimited duration

–Implementation with a start-up period from YYYY to YYYY,

–followed by full-scale operation.

1.7.Management mode(s) planned 12

☑ Direct management by the Commission

–◻ by its departments, including by its staff in the Union delegations;

–◻ by the executive agencies

◻ Shared management with the Member States

◻ Indirect management by entrusting budget implementation tasks to:

–◻ third countries or the bodies they have designated;

–◻ international organisations and their agencies (to be specified);

–◻the EIB and the European Investment Fund;

–◻ bodies referred to in Articles 208 and 209 of the Financial Regulation;

–◻ public law bodies;

–◻ bodies governed by private law with a public service mission to the extent that they provide adequate financial guarantees;

–◻ bodies governed by the private law of a Member State that are entrusted with the implementation of a public-private partnership and that provide adequate financial guarantees;

–◻ persons entrusted with the implementation of specific actions in the CFSP pursuant to Title V of the TEU, and identified in the relevant basic act.

–If more than one management mode is indicated, please provide details in the ‘Comments’ section.

Comments

2.MANAGEMENT MEASURES

2.1.Monitoring and reporting rules

Specify frequency and conditions.

Participation of Ukrainian entities in the Framework Programme for Research and Innovation and other cooperative activities under the Agreement will be regularly followed through meetings of the Joint Committee established under letter (a) of Article 6 of the Agreement.

2.2.Management and control system

2.2.1.Risk(s) identified

Meetings and bilateral contacts take place on a regular basis allowing for the systematic sharing of information and control therupon. No risks have been identified in the control system.

2.2.2.Information concerning the internal control system set up

N/A

2.2.3.Estimate of the costs and benefits of the controls and assessment of the expected level of risk of error

N/A

2.3.Measures to prevent fraud and irregularities

Specify existing or envisaged prevention and protection measures.

When the implementation of the Framework Programme calls for the use of external contractors or entails granting financial contribution to third parties, the Commission will carry out, where appropriate, financial audits, in particular if it has reason to doubt the realistic nature of work performed or described in the activity reports.

The Union’s financial audits will be carried out either by its own staff or by accounting experts approved according to the law of the audited party. The Union will choose the latter freely, while avoiding any risks of conflicts of interest which might be indicated to it by the party subject to the audit. In addition, the Commission will make sure, in carrying out the research activities, that the financial interests of the Union are protected by effective checks and, where irregularities are detected, by deterrent and proportionate measures and penalties.

In order to achieve this aim, rules on checks, measures and penalties, with reference to Regulations No 2988/95, No 2185/96 and No 883/2013 will be incorporated in all contracts used in the implementation of the framework programme.

In particular, the following points will have to be provided for in the contracts:

- the insertion of specific clauses in the contracts to protect the financial interests of the EU in carrying out checks and controls in relation to the work performed;

- the carrying out of administrative checks as part of anti-fraud measures, in accordance with Regulations No 2185/96, No 1073/1999 and No 1074/1999;

- the application of administrative penalties for all intentional or negligent irregularities in the implementation of the contracts, in accordance with the Framework Regulation No 2988/95, including a blacklisting mechanism;

- the fact that any recovery orders in the event of irregularities and fraud must be enforceable according to Article 299 of the Treaty on the Functioning of the European Union.

In addition and as a routine measure, a programme of checks on scientific and budgetary aspects of cooperation will be carried out by the staff responsible in the Directorate – General for Research and Innovation (DG R&I). An internal audit will be carried out by the Internal Audit unit of DG R&I, and local inspections will be carried out by the European Court of Auditors.

3.ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE

3.1.Heading(s) of the multiannual financial framework and expenditure budget line(s) affected

·Existing budget lines

In order of multiannual financial framework headings and budget lines.

Heading of multiannual financial framework	Budget line	Type of expenditure	Contribution
	Heading1a – Competitiveness for growth and jobs	Diff./Non-diff. 13	from EFTA countries 14	from candidate countries 15	from third countries	within the meaning of Article 21(2)(b) of the Financial Regulation
1a	08.01.05.01	Non-diff.	YES	YES	NO	NO
1a	08.01.05.03	Non-diff.	YES	YES	NO	NO

·New budget lines requested

In order of multiannual financial framework headings and budget lines.

Heading of multiannual financial framework

Budget line

Type of
expenditure

Contribution

Number
[Heading………………………………………]

Diff./Non-diff.

from EFTA countries

from candidate countries

from third countries

within the meaning of Article 21(2)(b) of the Financial Regulation

[XX.YY.YY.YY]

YES/NO

3.2.Estimated impact on expenditure

[This section should be filled in using the spreadsheet on budget data of an administrative nature (second document in annex to this financial statement) and uploaded to CISNET for interservice consultation purposes.]

3.2.1.Summary of estimated impact on expenditure

EUR million (to three decimal places)

Heading of multiannual financial
framework

'Competetiveness for growth and jobs'

DG: RTD			Year 2019 16	Year 2020	Year 2021	Year 2022	Year 2023	Year 2024	TOTAL
• Operational appropriations
Number of budget line	Commitments	(1)
	Payments	(2)
Number of budget line	Commitments	(1a)
	Payments	(2a)
Appropriations of an administrative nature financed from the envelope of specific programmes 17
Number of budget line: 08.01.05.01		(3)	0.010	0.060	0.060	0.060	0.060	0.050	0.300
Number of budget line: 08.01.05.03		(3)	0.002	0.012	0.012	0.012	0.012	0.010	0.060
TOTAL appropriations for DG RTD	Commitments	=1+1a +3	0.012	0.072	0.072	0.072	0.072	0.060	0.360
	Payments	=2+2a +3	0.012	0.072	0.072	0.072	0.072	0.060	0.360

• TOTAL operational appropriations	Commitments	(4)	0.010	0.060	0.060	0.060	0.060	0.050	0.300
	Payments	(5)	0.010	0.060	0.060	0.060	0.060	0.050	0.300
• TOTAL appropriations of an administrative nature financed from the envelope for specific programmes		(6)	0.002	0.012	0.012	0.012	0.012	0.010	0.060
TOTAL appropriations under HEADING <1a> of the multiannual financial framework	Commitments	=4+ 6	0.012	0.072	0.072	0.072	0.072	0.060	0.360
	Payments	=5+ 6	0.012	0.072	0.072	0.072	0.072	0.060	0.360

If more than one heading is affected by the proposal / initiative:

• TOTAL operational appropriations	Commitments	(4)
	Payments	(5)
• TOTAL appropriations of an administrative nature financed from the envelope for specific programmes		(6)
TOTAL appropriations under HEADINGS 1 to 4 of the multiannual financial framework (Reference amount)	Commitments	=4+ 6
	Payments	=5+ 6

Heading of multiannual financial
framework

‘Administrative expenditure’

EUR million (to three decimal places)

		Year 2019	Year 2020	Year 2021	Year 2022	Year 2023	Year 2024	TOTAL
DG: RTD
• Human resources
• Other administrative expenditure
TOTAL DG RTD	Appropriations

TOTAL appropriations
under HEADING 5
of the multiannual financial framework

(Total commitments = Total payments)

EUR million (to three decimal places)

		Year 2019 18	Year 2020	Year 2021	Year 2022	Year 2023	Year 2024	TOTAL
TOTAL appropriations under HEADINGS 1 to 5 of the multiannual financial framework	Commitments	0.012	0.072	0.072	0.072	0.072	0.060	0.360
	Payments	0.012	0.072	0.072	0.072	0.072	0.060	0.360

3.2.2.Estimated impact on operational appropriations

–☑ The proposal/initiative does not require the use of operational appropriations

Commitment appropriations in EUR million (to three decimal places)

Indicate objectives and outputs

⇩

Year
N

Year
N+1

Year
N+2

Year
N+3

Enter as many years as necessary to show the duration of the impact (see point 1.6)

TOTAL

OUTPUTS

Type 19

Average cost

Cost

Total No

Total cost

SPECIFIC OBJECTIVE No 1 20 …

- Output

Subtotal for specific objective No 1

SPECIFIC OBJECTIVE No 2 ...

- Output

Subtotal for specific objective No 2

TOTAL COST

3.2.3.Estimated impact on appropriations of an administrative nature

3.2.3.1.Summary

–◻ The proposal/initiative does not require the use of appropriations of an administrative nature

–☑ The proposal/initiative requires the use of appropriations of an administrative nature, as explained below:

EUR million (to three decimal places)

Year
2019 21

Year
2020

Year
2021

Year
2022

Year
2023

Year
2024

TOTAL

HEADING 5 of the multiannual financial framework
Human resources
Other administrative expenditure
Subtotal HEADING 5 of the multiannual financial framework

Outside HEADING 5 22 of the multiannual financial framework
Human resources	0.010	0.060	0.060	0.060	0.060	0.050	0.300
Other expenditure of an administrative nature	0.002	0.012	0.012	0.012	0.012	0.010	0.060
Subtotal outside HEADING 5 of the multiannual financial framework	0.012	0.072	0.072	0.072	0.072	0.060	0.360

TOTAL

0.012

0.072

0.060

0.360

The appropriations required for human resources and other expenditure of an administrative nature will be met by appropriations from the DG that are already assigned to management of the action and/or have been redeployed within the DG, together if necessary with any additional allocation which may be granted to the managing DG under the annual allocation procedure and in the light of budgetary constraints.

3.2.3.2.Estimated requirements of human resources

–◻ The proposal/initiative does not require the use of human resources.

–☑ The proposal/initiative requires the use of human resources, as explained below:

Estimate to be expressed in full time equivalent units

		Year 2019	Year 2020	Year 2021	Year 2022	Year 2023	Year 2024
• Establishment plan posts (officials and temporary staff)
XX 01 01 01 (Headquarters and Commission’s Representation Offices)
XX 01 01 02 (Delegations)
08 01 05 01 (Indirect research)		0.1	0.5	0.5	0.5	0.5	0.4
10 01 05 01 (Direct research)
• External staff (in Full Time Equivalent unit: FTE) 23
XX 01 02 01 (AC, END, INT from the ‘global envelope’)
XX 01 02 02 (AC, AL, END, INT and JED in the delegations)
XX 01 04 yy 24	- at Headquarters
	- in Delegations
XX 01 05 02 (AC, END, INT – Indirect research)
10 01 05 02 (AC, END, INT – Direct research)
Other budget lines (specify)
TOTAL		0.1	0.5	0.5	0.5	0.5	0.4

XX is the policy area or budget title concerned.

The human resources required will be met by staff from the DG who are already assigned to management of the action and/or have been redeployed within the DG, together if necessary with any additional allocation which may be granted to the managing DG under the annual allocation procedure and in the light of budgetary constraints.

Description of tasks to be carried out:

Officials and temporary staff

Preparation and management of meetings of the Joint Committee established under Art. 6(a) of the Agreement, as well as follow–up of the functioning and implementation of the Agreement.

Calculations are done proportionally considering the duration of the Agreement.

External staff

3.2.4.Compatibility with the current multiannual financial framework

–☑ The proposal/initiative is compatible the current multiannual financial framework.

Multiannual Financial Framework 2021-2027 is still to be adopted by the European Parliament and Council.

3.2.5.Third-party contributions

–The proposal/initiative does not provide for co-financing by third parties.

–

Appropriations in EUR million (to three decimal places)

	Year N	Year N+1	Year N+2	Year N+3	Enter as many years as necessary to show the duration of the impact (see point 1.6)	Total
Specify the co-financing body
TOTAL appropriations co-financed

3.3.Estimated impact on revenue

–☑ The proposal/initiative has no financial impact on revenue.

–◻ The proposal/initiative has the following financial impact:

–◻ on own resources

–◻ on miscellaneous revenue

EUR million (to three decimal places)

Budget revenue line:	Appropriations available for the current financial year	Impact of the proposal/initiative 25
		Year N	Year N+1	Year N+2	Year N+3	Enter as many years as necessary to show the duration of the impact (see point 1.6)
Article ………….

For miscellaneous ‘assigned’ revenue, specify the budget expenditure line(s) affected.

Specify the method for calculating the impact on revenue.