Legal provisions of COM(2019)411 - Further macro-financial assistance to Jordan - Main contents
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| dossier | COM(2019)411 - Further macro-financial assistance to Jordan. |
|---|---|
| document | COM(2019)411  |
| date | January 15, 2020 |
Article 1
2. The full amount of the Union’s macro-financial assistance shall be provided to Jordan in the form of loans. The Commission shall be empowered, on behalf of the Union, to borrow the necessary funds on the capital markets or from financial institutions and to on-lend them to Jordan. The loans shall have a maximum average maturity of 15 years.
3. The release of the Union’s macro-financial assistance shall be managed by the Commission in a manner consistent with the agreements or understandings reached between the IMF and Jordan, and with the key principles and objectives of economic reforms set out in the Association Agreement.
The Commission shall regularly inform the European Parliament and the Council of developments regarding the Union’s macro-financial assistance, including disbursements thereof, and shall provide those institutions with the relevant documents in due time.
4. The Union’s macro-financial assistance shall be made available for a period of two and a half years, starting from the first day after the entry into force of the Memorandum of Understanding referred to in Article 3(1).
5. If the financing needs of Jordan decrease fundamentally during the period of the disbursement of the Union’s macro-financial assistance compared to the initial projections, the Commission, acting in accordance with Article 7(2), shall reduce the amount of the assistance, suspend or cancel it.
Article 2
2. The Commission and the EEAS shall monitor the fulfilment of the pre-condition laid down in paragraph 1 throughout the life-cycle of the Union’s macro-financial assistance.
3. Paragraphs 1 and 2 shall be applied in accordance with Council Decision 2010/427/EU (9).
Article 3
2. The conditions referred to in paragraph 1 shall aim, in particular, at enhancing the efficiency, transparency and accountability of the public finance management systems in Jordan, including for the use of the Union’s macro-financial assistance. Progress in mutual market opening, the development of rules-based and fair trade, and other priorities in the context of the Union’s external policy shall also be duly taken into account when designing the policy measures. Progress in attaining those objectives shall be regularly monitored by the Commission.
3. The detailed financial terms of the Union’s macro-financial assistance shall be laid down in a loan agreement to be concluded between the Commission and the Jordanian authorities (the ‘Loan Agreement’).
4. The Commission shall verify, at regular intervals, that the conditions referred to in Article 4(3) continue to be met, including whether the economic policies of Jordan are in accordance with the objectives of the Union’s macro-financial assistance. In so doing, the Commission shall coordinate closely with the IMF and the World Bank, and, where necessary, with the European Parliament and the Council.
Article 4
2. The amounts of the Union’s macro-financial assistance shall be provisioned, where required, in accordance with Council Regulation (EC, Euratom) No 480/2009 (10).
3. The Commission shall decide on the release of the instalments subject to the fulfilment of all of the following conditions:
| (a) | the pre-condition laid down in Article 2(1); |
| (b) | a continuous satisfactory track record of implementing a policy programme that contains strong adjustment and structural reform measures supported by a non-precautionary IMF credit arrangement; and |
| (c) | the satisfactory implementation of the economic policy and financial conditions agreed in the Memorandum of Understanding. |
The release of the second instalment shall not, in principle, take place earlier than three months after the release of the first instalment. The release of the third instalment shall not, in principle, take place earlier than three months after the release of the second instalment.
4. Where the conditions referred to in the first subparagraph of paragraph 3 are not met, the Commission shall temporarily suspend or cancel the disbursement of the Union’s macro-financial assistance. In such cases, it shall inform the European Parliament and the Council of the reasons for such suspension or cancellation.
5. The Union’s macro-financial assistance shall be disbursed to the Central Bank of Jordan. Subject to the provisions to be agreed in the Memorandum of Understanding, including a confirmation of residual budgetary financing needs, the Union funds may be transferred to the Jordanian Ministry of Finance as the final beneficiary.
Article 5
2. Where the circumstances permit and if Jordan so requests, the Commission may take the steps necessary to ensure that an early repayment clause is included in the loan terms and conditions and that it is matched by a corresponding clause in the terms and conditions of the borrowing operations.
3. Where circumstances permit an improvement of the interest rate of the loan and if Jordan so requests, the Commission may decide to refinance all or part of its initial borrowings or may restructure the corresponding financial conditions. Refinancing or restructuring operations shall be carried out in accordance with paragraphs 1 and 4 and shall not have the effect of extending the maturity of the borrowings concerned or of increasing the amount of capital outstanding at the date of the refinancing or restructuring.
4. All costs incurred by the Union which relate to the borrowing and lending operations under this Decision shall be borne by Jordan.
5. The Commission shall inform the European Parliament and the Council of any developments in the operations referred to in paragraphs 2 and 3.
Article 6
2. The Union’s macro-financial assistance shall be implemented under direct management.
3. The Loan Agreement shall contain provisions:
| (a) | ensuring that Jordan regularly checks that financing provided from the general budget of the Union has been properly used, takes appropriate measures to prevent irregularities and fraud, and, if necessary, takes legal action to recover any funds provided under this Decision that have been misappropriated; |
| (b) | ensuring the protection of the Union’s financial interests, in particular providing for specific measures in relation to the prevention of, and fight against, fraud, corruption and any other irregularities affecting the Union’s macro-financial assistance, in accordance with Council Regulation (EC, Euratom) No 2988/95 (12), Regulation (Euratom, EC) No 2185/96 and Regulation (EU, Euratom) No 883/2013. To that end, OLAF shall be expressly authorised to carry out investigations, including on-the-spot checks and inspections including digital forensic operations and interviews; |
| (c) | expressly authorising the Commission (OLAF), or its representatives, to carry out checks, including on-the-spot checks and inspections; |
| (d) | expressly authorising the Commission and the Court of Auditors to perform audits during and after the availability period of the Union’s macro-financial assistance, including document audits and on-the-spot audits, such as operational assessments; |
| (e) | ensuring that the Union is entitled to early repayment of the loan where it has been established that, in relation to the management of the Union’s macro-financial assistance, Jordan has engaged in any act of fraud or corruption or any other illegal activity detrimental to the financial interests of the Union; |
| (f) | ensuring that all costs incurred by the Union which relate to the borrowing and lending operations under this Decision shall be borne by Jordan. |
4. Before the implementation of the Union’s macro-financial assistance, the Commission shall assess, by means of an operational assessment, the soundness of Jordan’s financial arrangements, the administrative procedures, and the internal and external control mechanisms which are relevant to the assistance.
Article 7
2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply.
Article 8
| (a) | examine the progress made in implementing the Union’s macro-financial assistance; |
| (b) | assess the economic situation and prospects of Jordan, as well as progress made in implementing the policy measures referred to in Article 3(1); |
| (c) | indicate the connection between the economic policy conditions laid down in the Memorandum of Understanding, Jordan’s on-going economic and fiscal performance and the Commission’s decisions to release the instalments of the Union’s macro-financial assistance. |
2. Not later than two years after the expiry of the availability period referred to in Article 1(4), the Commission shall submit to the European Parliament and to the Council an ex-post evaluation report, assessing the results and efficiency of the completed Union’s macro-financial assistance and the extent to which it has contributed to the aims of the assistance.