Select Committee on European Scrutiny First Report


COM(00) 898

Draft Council Regulation on the statute and financing of European political parties.

Legal base: Article 308; unanimity
Department: Foreign and Commonwealth Office
Basis of consideration: Minister's letter of 16 July 2001
Previous Committee Report: HC 28-x (2000-01), paragraph 7 (28 March 2001)
To be discussed in Council: 8 October 2001 General Affairs Council
Committee's assessment: Politically important
Committee's decision: Cleared


52.1  Article 190(5) of the EC Treaty, as amended by the Treaty of Amsterdam, provides for the European Parliament (EP) to lay down the regulations and general conditions governing the performance of the duties of its Members. In December 1998, the EP adopted a proposal for a Statute laying down these regulations and conditions. Members of the EP (MEPs) had hoped that it would be agreed before the European elections in June 1999. We cleared a Council draft on 21 April 1999.[93] However, agreement was not reached and in February 2000, after almost a year of deadlock, the EP decided to set up a group of eminent persons to make recommendations on the Statute.

52.2  We considered the group's report on 25 October 2000, 15 November 2000 and 10 January 2001.[94] On 25 October 2000, we recommended it for debate in European Standing Committee together with Special Report No.13/2000 of the Court of Auditors on expenditure by the European Parliament's political groups.[95]

52.3  We considered the proposal again on 28 March and cleared it, but asked the Government to inform us if it decided to challenge the legal base.

52.4  On 13 July, the proposal emerged from the Working Group and the Belgian Presidency has produced a new text which, at the time of writing, is only available in French. It invites comments from Member State delegations before 28 August.

The Minister's letter

52.5  In a letter dated 17 July, the Minister for Europe (Peter Hain) says that the Presidency is aiming to get this text agreed at the 8 October General Affairs Council. He describes the main provisions of the text, a copy of which he attaches, as follows:

    "(i) Registration. Qualifications for the registration of a Statute by a European Political Party (EPP) are: participation or intended participation in EP elections; clear political objectives; and respect for the principles of liberty, democracy, human rights and fundamental freedoms, and the rule of law.

    "(ii) Verification. The EP will verify these qualifications by a simple majority after a request of a quarter of its members from at least 3 Political Groups and after consultation with a Committee of Independent Persons (composed of 3 members nominated respectively by the EP, the Council and the Commission).

    "(iii) Legal Personality. In each Member State, European Political Parties shall have the most extensive legal personality as accorded to legal persons under national legislation; and can acquire property and appear in Court.

    "(iv) Financing. Eligibility depends on having elected representatives from the EP or national or regional Parliaments in at least a quarter of the Member States or having received at least 5% of votes at the last EP elections in at least a quarter of the Member States; full and transparent annual publication of finances; and prohibition of anonymous donations above 100 euros, or from EP Political Groups, or from legal persons (individuals, companies etc) with the exception of national parties.

    "(v) Expenses. Funds can be used for administration, technical support, meetings, studies, information and publications. But they cannot be used for direct or indirect funding of national political parties or for campaigning.

    "(vi) Control. Money must be accounted for in accordance with the rules applicable to the general budget of the EC and the financial regulation on the basis of an annual certificate by an external and independent auditor to be transmitted to the EP and the European Court of Auditors.

    "(vii) Distribution. 15% of the financing will be divided between the eligible EPPs on a flat-rate basis, and 85% will be distributed in ratio to the number of their MEPs. Community funding cannot be more than 75% of the budget of an EPP.

    "(viii) Expiry. The regulation will expire at the end of the second financial year after entry into force."

52.6  The Minister recalls that his predecessor, (Mr Keith Vaz) informed us in his Explanatory Memorandum of 20 March 2001 that the Government has three main objectives in the negotiations on this proposal:

    "I. To reform thoroughly the funding of European Political Parties, as recommended by the European Court of Auditors;

    "II. To prevent any EC funding for national political parties; and

    "III. To avoid any bias against EPPs on the basis of their views on European integration, either for or against".

52.7  The Minister then comments:

    "I am confident that the final text will meet these objectives. I welcome the progress made so far, in particular:
  • the clear reference in the Statute to the prohibition of the funding for national political parties;

  • the tighter language on implementation and control; and

  • the flexible definition of European Political Parties, which includes an 'alliance of political parties'."

52.8  He says that the Government intends to clarify further with the Commission the question of legal personality for European political parties and the sources of their financing.

The legal base

52.9  As regards the legal base, the Minister comments:

    "The Commission are proposing that Article 308 (which requires unanimity) be used as a temporary legal base for this Statute before the entry into force of the Treaty of Nice which will provide a new legal base (amended Article 191 TEC) with decisions by QMV. We have considered this proposal carefully and have come to the conclusion that the use of Article 308 is justified legally. Provided we get the details right, I am content that Article 308 be used, not least to ensure full transparency of funding for EPPs as soon as possible".

Informing the UK parties in the European Parliament

52.10  The Minister then informs us that he will be writing separately on this proposal to the Treasurers of the UK parties represented in the European Parliament.


52.11  We support the Government's desire to ensure full transparency of funding for European political parties as soon as possible and can see that this desire underlies the decision to make use of an existing Article, even if this smacks of expediency triumphing over principle. However, as the Treaty of Nice will provide a sound new legal base and the Regulation will expire after two years, we do not propose to withhold clearance. Nevertheless, we remain doubtful about the adequacy of the legal base.

52.12  This is the only aspect of the proposal which gives us concern, and we now clear the document.

93  (19675) 13978/98; see HC 34-xvi (1998-99), paragraph 11 (21 April 1999).  Back

94  (21432) 9712/00; see HC 28-ii (2000-01), paragraph 2 (10 January 2001); HC 23-xxix (1999-2000), paragraph 2 (15 November 2000); and HC 23-xxvii (1999-2000), paragraph 2 (25 October 2000). Back

95  (21396) 9560/00; see HC 23-xxvii (1999-2000), paragraph 2 (25 October 2000) and HC 23-xxix (1999-2000), paragraph 1 (15 November 2000). See also Official Report, European Standing Committee B, 29 January 2001.  Back

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Prepared 30 July 2001