The regulations governing political parties and rules regarding their funding at European level

Political parties at European level may be eligible for funding from the general budget of the European Union. They must be represented in at least one quarter of the Member States, by Members of the European Parliament or in the national or regional Parliaments, observe, in their political agendas and activities, the founding principles of the Union , such as the rule of law, and participate in the elections to the European Parliament.

ACT

Regulation (EC) No 2004/2003 of the European Parliament and of the Council of 4 November 2003 on the regulations governing political parties at European level and the rules regarding their funding [See amending acts].

SUMMARY

This Regulation lays down the regulations governing political parties at European level and rules regarding their funding.

Application for funding

A political party at European level may file an application for funding with the European Parliament each year. The Regulation defines "political party" as an association of citizens, which pursues political objectives, and is established and recognised in accordance with the national rules of at least one Member State.

In order to be qualified as a "political party at European level", a party must:

• have legal personality in the Member State in which its seat is located;
• be represented, in at least one quarter of the Member States, by Members of the European Parliament (or in the national or regional Parliaments or regional assemblies),or it must have received, also in at least one quarter of the Member States , at least 3% of the votes cast in each of those Member States at the most recent European Parliament elections;
• observe, in particular in its programme and in its activities, the founding principles of the European Union, namely the principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law;
• have participated in elections to the European Parliament, or have expressed the intention to do so.

The European Parliament ensures that the political parties at European level continue to meet these criteria. If any of these conditions is no longer satisfied, the relevant party forfeits its status of "political party at European level" and consequently is excluded from funding under this Regulation.

Political foundations affiliated to a political party at European level may also submit an application for funding via this party. The Regulation defines "political foundation at European level" as an entity (or network of entities) which has legal personality in an EU Member State and is affiliated with a political party at European level. Political foundations at European level have the task of observing, analysing, communicating, and contributing to the debate, in particular with a view to European elections. The financial rules applicable to foundations are identical to those regarding parties.

The application for funding must be accompanied by documents proving that it is a political party at European level. It must also give evidence of the party's political programme and a statute defining in particular the bodies responsible for political and financial management as well as the natural persons holding, in each of the Member States concerned, the power of legal representation. Any subsequent amendment to the above-mentioned documents, must be notified to the European Parliament within two months. In the absence of such notification, funding is suspended. The European Parliament takes a decision within three months following receipt of an application for funding.

Provenance of funding, distribution and obligations

Political parties at European level are funded from the general budget of the European Union. This budget may not be used for the funding of other political parties and in particular national political parties. The latter remain governed by national rules. Similarly, the appropriations allocated to the European foundations may not be used for financing political parties or candidates at national or European level, or foundations at national level. Appropriations received from the Community budget may only be used to meet expenditure directly linked to the objectives set out in the party's political programme. They may be used to fund European Parliament election campaigns. The appropriations allocated to funding political parties and foundations at European level are determined in accordance with the annual budgetary procedure.

The budget of a political party or political foundation at European level must include sources of funding, of at least 15%, other than the Community budget.

The available budget for the political parties is distributed annually as follows: 15% is distributed in equal shares among the parties which have obtained a positive decision on their application and 85% is distributed among those which have elected members in the European Parliament, in proportion to the number of elected members.

The Regulation lays down the obligations linked to funding. A party or foundation receiving funding must:

• publish its revenue and expenditure and a statement of its assets and liabilities annually;
• declare its sources of funding by providing a list specifying the donors and the donations received from each donor, exceeding EUR 500;
• not accept anonymous donations, donations exceeding EUR 12 000 per year and per donor, donations from the budgets of political groups in the European Parliament, donations from any company over which the public authorities may exercise a dominant influence by virtue of their ownership of it, or their financial participation therein, and donations from any public authority from a non-EU country.

However, contributions from national political parties, which are members of a political party at European level, are admissible. Similarly, contributions from national political foundations, which are members of a political foundation at European level, are admissible. They may not exceed 40% of the annual budget of the political party or foundation at European level. . Foundations may not receive contributions from funds obtained by a political party from the general budget of the EU, in accordance with this Regulation.

Background

The budget for the purposes of the political parties at European level was EUR 10.4 million in 2007. Ten parties are receiving funding.

RELATED ACTS

Decision of the Bureau of the European Parliament of 29 March 2004 laying down the procedures for implementing Regulation (EC) No 2004/2003 of the European Parliament and of the Council on the regulations governing political parties at European level and the rules regarding their funding [Official Journal C 252/1 of 3.10.2008].

This Decision applies both to political parties at European level, and to political foundations at European level.

At the beginning of every parliamentary term, the Bureau adopts an indicative multiannual financial framework. Any organisation wishing to receive a grant from the general budget of the European Union submits a written application to the President of the European Parliament prior to the 1 November preceding the financial year in respect of which the grant is being requested. A grant application form must be completed (Annex 1 to the Decision). Grants are paid to beneficiaries in the form of pre-financing in one instalment of 80% of the total amount of the grant. Under no circumstances may the total amount paid to the beneficiary by Parliament exceed 85% of the eligible expenditure actually incurred.

The Bureau may also decide to suspend payments and reduce the grant if necessary.

European Parliament resolution of 23 March 2006 on the application of Regulation (EC) No 2004/2003 [Official Journal C292 E, 1.12.2006].

On 23 March 2006, the European Parliament adopted a resolution on the operation of this Regulation. In that resolution, the European Parliament takes into account the practical experience gained since the Regulation entered into force and advocates a number of improvements such as the payment of appropriations in a manner more suited to the way its recipients operate, or moving forward the deadline for the submission of the parties' final accounts, in order to ensure the efficient management of funding.

Decision of the Bureau of the European Parliament of 29 March 2004 laying down the procedures for implementing Regulation (EC) No 2004/2003 of the European Parliament and of the Council on the regulations governing political parties at European level and the rules regarding their funding [Official Journal C 150, 28.6.2006]. This decision sets out the procedures for the implementation of Regulation (EC) No 2004/2003. It provides for, among other things, a form to be used for funding applications (Annex 1). These application forms must be submitted before 15 November preceding the financial year for which the grant is requested.

Last updated: 04.03.2009