Introductory text

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 308 thereof,

Having regard to the Treaty establishing the European Atomic Energy Community, and in particular Article 203 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Parliament^f1,

Having regard to the opinion of the Court of Auditors^f2,

Whereas:

The efficiency of the use made of budgetary means reserved for the Guarantee Fund established by Council Regulation (EC, Euratom) No 2728/94^f3 should be improved and the administrative work related to the budgetary management of the Guarantee Fund reduced.

The transparency and programming of budgetary transactions in relation to the provisioning of the Guarantee Fund should be enhanced.

The Interinstitutional Agreement between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management^f4 adopted on 17 May 2006 sets the multiannual financial framework of the European Union for the period 2007 to 2013. Pursuant to the Interinstitutional Agreement, the funding of the Guarantee Fund is provided for as an obligatory expenditure from the general budget of the European Union for that period.

The main function of the Guarantee Fund, namely to shield the general budget of the European Union against shocks due to defaults on loans or guaranteed loans covered by the Fund, should be maintained.

The Guarantee Fund covers defaults under loans issued by the European Investment Bank (hereinafter the EIB) for which the Community provides a guarantee under the EIB's external mandate. In addition, in line with the EIB's external mandate as taking effect from 1 February 2007, the Fund should also cover defaults under loan guarantees issued by the EIB for which the Community provides a guarantee.

Council Regulation (EC, Euratom) No 2728/94 should therefore be amended accordingly.

The Treaties provide for no powers, other than those in Article 308 of the EC Treaty and Article 203 of the Euratom Treaty, for the adoption of this Regulation,

HAS ADOPTED THIS REGULATION: