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The European Council of 15 and 16 March 2002 held in Barcelona underlined in its conclusions that strong and integrated energy and transport networks are the cornerstone of the European internal market and that better use of the existing networks and the completion of missing links will make it possible to increase effectiveness and competitiveness and to guarantee an appropriate level of quality and a reduction in saturation points and, therefore, better long-term viability. These needs fall within the framework of the strategy adopted by the Heads of State and Government at the European Council of 23 and 24 March 2000 held in Lisbon, which has been regularly referred to since then.

The European Council of 12 and 13 December 2003 held in Brussels approved European action for growth, calling on the Commission to redirect expenditure, if necessary, towards investments in physical capital, in particular investments in the infrastructure of the trans-European networks, the priority projects of which represent essential elements to strengthen the cohesion of the internal market.

Delays in the completion of effective trans-European connections, in particular cross-border sections, are likely to seriously handicap the competitiveness of the Union, the Member States and peripheral regions which would not, or would no longer, be able to profit fully from the beneficial effects of the internal market.

In Decision No 1692/96/EC of the European Parliament and of the Council of 23 July 1996 on Community guidelines for the development of the trans-European transport network ( 3 ) , the cost of completing the trans-European transport network between 2007 and 2020 was estimated at EUR 600 billion. The investments necessary for the priority projects within the meaning of Annex III to that Decision alone account for almost EUR 160 billion for the period 2007 to 2013.

To achieve these goals, both the European Parliament and the Council have put forward the need to strengthen and adapt existing financial instruments through an increase in the level of Community co-financing by providing for the possibility of applying a higher Community co-financing rate, in particular for projects characterised by their cross-border nature, their transit function, or by the crossing of natural barriers.

In accordance with the Communication from the Commission to the European Parliament and the Council on the ‘promotion of inland waterway transport “NAIADES”’ and having regard to the sustainable nature of inland waterways, inland waterways projects should receive special attention.

In its Resolution of 8 June 2005 on policy challenges and budgetary means of the enlarged Union 2007 to 2013 ( 4 ) , the European Parliament underlined the strategic importance of transport networks for the completion of the internal market and for closer relations with candidate, pre-candidate and ‘ring of friends’ countries. Moreover, it also expressed its willingness to examine innovative financing instruments such as loan guarantees, European concessions, European loans and an interest relief fund.

With the amounts allocated to the trans-European networks in the transport and energy sectors (hereinafter referred to as ‘TEN-T’ and ‘TEN-E’ respectively) in accordance with the multiannual financial framework 2007 to 2013, it is impossible to meet all the needs arising in connection with the implementation of the priorities set out in Decision No 1692/96/EC for TEN-T and Decision No 1364/2006/EC ( 5 ) for TEN-E. In order to complement national sources of financing, both public and private, it is therefore appropriate to focus these resources on certain categories of projects which will provide the greatest added value for the networks as a whole, in particular the cross-border sections, including the motorways of the sea, and projects aimed at removing bottlenecks, such as natural barriers, so as to guarantee the continuity of TEN-T and TEN-E infrastructure. In order to facilitate the coordinated implementation of certain projects, European Coordinators may be designated in accordance with Article 17 a of Decision No 1692/96/EC.

Taking into account that the remaining TEN-T investment in priority projects is estimated at about EUR 250 billion and that the European financial reference amount of EUR 8 013 million for transport for the period 2007 to 2013 only represents a tiny part of the necessary budget for completion of the priority projects, the Commission should, with the help of European Coordinators where appointed, carry out actions to support and coordinate Member States' efforts to finance and complete the planned TEN-T, in line with the timetable laid down. The Commission should implement the provisions concerning European Coordinators referred to in Decision No 1692/96/EC. It should also study and intend to solve, together with the Member States, the long-term financial problem of building and operating the whole TEN-T, bearing in mind that the building period comprises at least two seven-year budget periods and the expected life of the new infrastructure is at least a century.

Decision No 1364/2006/EC identifies the objectives, priorities for action and projects of common interest to develop TEN-E, including the priority projects, and assigns appropriate priority to projects declared to be of European interest. The investments necessary to make it possible for all the Member States to take part fully in the internal market and to complete interconnections with neighbouring countries are about EUR 28 billion between 2007 and 2013 for the priority projects alone.

The European Council of 12 and 13 December 2003 also called on the Commission to continue studying the need to create a specific Community guarantee instrument intended to cover certain post-construction risks in the framework of TEN-T projects. With regard to energy, the European Council called on the Commission, to redirect expenditure, if necessary, towards investments in physical capital in order to stimulate growth.

Council Regulation 1995/2236 of 18 September 1995 laying down the rules for the granting of Community financial aid in the field of the trans-European networks ( 6 ) already represents real progress, since it permits a higher financing rate of 20 % for projects declared as having priority. It nevertheless remains conditional on implementation rules which require simplification and an overall budget with limited resources. It appears therefore necessary to complement national public financing and private financing by increasing Community aid in terms of both its amount and the rates of assistance, with a view to strengthening the leverage effect of the Community funds, thus making it possible to carry out the priority projects selected.

By means of this Regulation, it is appropriate to establish a programme determining the general rules for the granting of Community financial aid in the field of TEN-T and TEN-E. That programme, which must be carried out in conformity with Community law, in particular as regards the environment, should contribute to the reinforcement of the internal market and have a stimulating effect on the competitiveness of and growth in the Community.

Community financial aid under the budget for the trans-European networks should, in addition to focusing on the projects or parts of projects presenting the greatest European added value, be such as to encourage the players to accelerate the implementation of the priority projects under Decisions Nos 1692/96/EC and 1364/2006/EC. It should also make it possible to finance the other European infrastructure projects of common interest defined in those Decisions.

Community financial aid is granted with the aim of developing investment projects in TEN-T and TEN-E, of providing firm financial commitments, of mobilising institutional investors and of prompting the formation of financing partnerships between the public and private sectors. In the energy sector, the financial assistance is mainly intended to help to overcome the financial obstacles which can arise at the time of project preparation and pre-construction development, and should be concentrated on the cross-border sections of priority projects and on interconnections with neighbouring countries.

In its Communication to the European Parliament and the Council of 4 July 2005 on the deployment of the European rail signalling system ERTMS/ETCS, the Commission emphasised the importance of rapid and coordinated migration to that system in order to ensure the interoperability of the TEN-T. To this end, targeted and temporary Community support is needed, both for track-side equipment and for onboard equipment.

For certain projects, the Member States concerned may be represented by international organisations. For certain projects, the Commission may entrust implementation to joint undertakings within the meaning of Article 171 of the Treaty. These special situations necessitate extending the concept of beneficiary of the Community financial contribution for the purposes of this Regulation.

To respond to the specific requirements of each project and to increase the efficiency and value of the Community financial aid, this aid may take several forms: grants for studies and works, grants for availability payments, interest rate rebates, loan guarantees or participation in risk capital funds. Regardless of its form, the Community financial aid should be granted in accordance with the provisions of Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities ( 7 ) and its implementing rules, except where this Regulation explicitly departs from those rules. The issuance of loan guarantees and participation in risk capital funds should be based on market principles and aim at self-financing in the longer term.

For the implementation of Community financial support for large-scale projects phased over several years, it is advisable to allow a commitment from the Community on a multiannual basis, differentiating by project financed and by commitment appropriations authorised annually. Only firm, attractive financial commitments binding on the Community over the long term will make it possible to reduce the uncertainties connected with the completion of these projects and to mobilise both public and private investors. The projects included in the multiannual programme represent the highest priorities in the development of TEN-T as referred to in Decision No 1692/96/EC and require continuing Community action to ensure their smooth and efficient completion.

It is appropriate to encourage public-private forms of financing, whether institutional or contractual, which have proved to be effective, by means of legal guarantees which are compatible with competition law and the internal market, and to disseminate good practice among the Member States.

Close attention should be paid to the effective coordination of all Community measures having an impact on the trans-European networks, in particular financing from the Structural Funds and from the Cohesion Fund and the operations of the European Investment Bank (hereinafter referred to as the EIB).

This Regulation lays down, for the entire duration of its implementation, a financial envelope constituting the prime reference amount, within the meaning of point 37 of the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management ( 8 ) , for the budgetary authority during the annual budgetary procedure.

The measures necessary for the implementation of this Regulation should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission ( 9 ) .

In the light of developments in each component of TEN-T and TEN-E and of their intrinsic characteristics, and with a view to more effective management, it is advisable to provide for several separate Regulations for the fields covered to date by Regulation 1995/2236.

By means of this Regulation, general rules should be laid down for the granting of Community financial aid in the field of the TEN-T and TEN-E in accordance with Community law and policies concerning, in particular, competition, environmental protection, health, sustainable development, public procurement and the effective implementation of the Community policies on interoperability.

Since the objective of this Regulation, namely the implementation of TEN-T and TEN-E, cannot be sufficiently achieved by the Member States, and can, by reason of the need for coordination of national measures, be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary to achieve that objective,