Explanatory Memorandum to COM(2003)758-2 - Amendment of Decision 2000/819/EC on a multiannual programme for enterprise and entrepreneurship, and in particular for small and medium-sized enterprises (SMEs) (2001-2005) - Main contents
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| dossier | COM(2003)758-2 - Amendment of Decision 2000/819/EC on a multiannual programme for enterprise and entrepreneurship, and in particular for ... |
|---|---|
| source | COM(2003)758  |
| date | 08-12-2003 |
The evaluation report on the Growth and Employment Initiative (1998-2000) has been prepared in accordance with Article 7 i of the Council Decision 98/347/EC adopted on 19 May 1998. This Decision requires the Commission to provide an evaluation of the programme, notably as regards its overall utilisation, its immediate effects on the creation of employment and the prospects for the creation of employment in the long term by SMEs.
On 20 December 2000, by Decision 2000/819/EC, the Council decided to extend the financial instruments of the Growth and Employment Initiative (the SME Guarantee Facility, the ETF Start-up Facility and the Joint European Venture (JEV) programme) under this new legal basis. A new instrument, the Seed Capital Action, was also added. However, no additional budget was foreseen for JEV.
Annex II, point IV of this Decision notes that JEV needs to be simplified, in order better to respond to the needs of SMEs, including those in applicant States, and that the Commission was examining the possibility of such simplification. However, after careful analysis, the Commission has determined that it is not possible to simplify JEV significantly under Decision 2000/819/EC because:
- this Decision does not contain any rules to allow the Commission to adopt measures to change the structure of the programme as described in Annex II of Council Decision 98/347/EC;
- this Decision does not contain any rules to allow the Commission to adapt the eligibility criteria of the programme contained in Council Decision 98/347/EC;
- the budget for JEV was committed on the basis of the Framework Agreement signed between the Commission and the financial intermediaries in the JEV network. Any change to the substance of these agreements, which is considered necessary both in order to simplify the programme and to adequately protect the Community financial interest, would therefore not be consistent with Article 6 i of the old Financial Regulation (in force at the time of the commitment);
- the budget for JEV was committed under the Growth and Employment Initiative (1998-2000) and is therefore reserved exclusively for those states that were members of the European Union and the European Economic Area at the time that Council Decision 98/347/EC entered into force. It is not therefore possible to use it for projects involving the accession and candidate countries;
- Decision 2000/819/EC does not allow the Commission to expand the definition of transnational joint venture (the only eligible form of transnational cooperation foreseen under Decision 98/347/EC) to the broader transnational partnership (referred to in Decision 2000/819/EC), which is considered necessary as part of any adaptation of the programme.
The evaluation of the Growth and Employment Initiative indicates that two of the three financial instruments, the SME Guarantee Facility and the ETF Start-up Facility, can be considered a success. However, the JEV programme, whose aim was to assist SMEs in creating new transnational joint ventures within the European Union (and later the European Economic Area), was not a success. This was due to low demand from the market (very little of the available budget was committed to projects), low employment creation, poor cost-effectiveness for both the Commission and SMEs, and generally low satisfaction with the instrument among SMEs.
2. Objectives of the Commission's proposal
The main objective of the Commission's proposal is to phase out the JEV programme as soon as possible and return the unspent funds (+/- EUR 43m) to the general budget.
At the same time, the Commission proposes to make several minor amendments to Annex I of Council Decision 2000/819/EC relating to the entry into force of the new RTD framework programme, the eligibility of RTD activities under ETF Start-up and the length of the start-up period for specific high tech sectors.
3. Content of the Commission's proposal
The following two documents are submitted to the Council and Parliament:
1. evaluation report on the Growth and Employment Initiative;
2. proposal to amend the Council Decision 2000/819/EC on a multiannual programme for enterprise and entrepreneurship, and in particular for small and medium-sized enterprises (SMEs) (2001-2005).
The Council together with Parliament in accordance with the procedure laid down in Article 251 of the Treaty is asked to adopt the proposed amendment of Council Decision 2000/819/EC, which comprises:
1. Authorisation of the phasing-out of the JEV programme;
2. Modification of Annex 1 of Council Decision 2000/819/EC to make a more explicit reference to the eligibility of RTD activities under the ETF Start-up Facility; to update the reference to the fifth framework programme for RTD (in order to take account of the launch of the sixth framework programme); and to extend the definition of the start-up period for specific high technology sectors, in particular life sciences, to 10 years (to reflect the extended pre-commercialisation product development and testing phases that are characteristic of these particular sectors).