CHAPTER IIBUDGETARY CONTRIBUTION AND MECHANISMS
Article 7Activities
1.
The Union budgetary appropriations assigned to the Galileo and EGNOS programmes for the period 2014-2020 under this Regulation shall be granted to finance activities relating to:
(a)
the completion of the deployment phase of the Galileo programme as referred to in Article 3(c);
(b)
the exploitation phase of the Galileo programme as referred to in Article 3(d);
(c)
the exploitation phase of the EGNOS programme as referred to in Article 4;
(d)
the management and monitoring of the Galileo and EGNOS programmes.
2.
The Union budgetary appropriations assigned to the Galileo and EGNOS programmes shall, in accordance with Article 9(2), also be granted to finance activities relating to research and development of fundamental elements, such as Galileo-enabled chipsets and receivers.
3.
The Union budgetary appropriations assigned to the Galileo and EGNOS programmes shall also cover Commission expenditure relating to the preparation, monitoring, inspection, audit and assessment activities required for the management of the programmes and the implementation of the specific objectives referred to in Article 2(4) and (5). Such expenditure may cover in particular:
(a)
studies and meetings with experts;
(b)
information and communication activities, including institutional communication on the policy priorities of the Union where they are directly linked to the objectives of this Regulation, with a particular view to creating synergies with other relevant Union policies;
(c)
IT technology networks, with the objective of processing or transferring data;
(d)
any other technical or administrative assistance given to the Commission for the management of the programmes.
4.
The costs of the Galileo and EGNOS programmes and of the different phases of those programmes shall be clearly identified. The Commission shall, in accordance with the principle of transparent management, inform the European Parliament, the Council and the Committee referred to in Article 36 ("the Committee") on an annual basis of the allocation of Union funds, including the contingency reserve, to each of the activities specified in paragraphs 1, 2 and 3 of this Article and of the use of those funds.
Article 8Financing of the Galileo and EGNOS programmes
1.
In accordance with Article 9, the Union shall finance the activities relating to Galileo and EGNOS programmes referred to in Article 7(1), (2) and (3), to fulfil the objectives as set out in Article 2, without prejudice to any contribution from any other funding source, including those referred to in paragraphs 2 and 3 of this Article.
2.
Member States may make a request to provide additional funding for the Galileo and EGNOS programmes to cover additional elements in particular cases, on condition that such additional elements do not create any financial or technical burden or any delay for the programme concerned. On the basis of a request from a Member State, the Commission shall decide, in accordance with the examination procedure referred to in Article 36(3), whether those two conditions have been met. The Commission shall communicate any impact on the Galileo and EGNOS programmes resulting from the application of this paragraph to the European Parliament, the Council and the Committee.
3.
Third countries and international organisations may also provide additional funding for the Galileo and EGNOS programmes. The international agreements referred to in Article 29 shall stipulate the conditions and arrangements for their involvement.
4.
The additional funding referred to in paragraphs 2 and 3 of this Article shall constitute external assigned revenue in accordance with Article 21(2) of Regulation (EU, Euratom) No 966/2012.
Article 9Resources
1.
The financial envelope for the implementation of the activities referred to in Article 7(1), (2) and (3) and for covering the risks associated with those activities is set at EUR 7 071,73 million in current prices for the period from 1 January 2014 to 31 December 2020.
The annual appropriations shall be authorised by the European Parliament and the Council within the limits of the multiannual financial framework.
The amount referred to in the first subparagraph shall be broken down in the following categories of expenditure in current prices:
(a)
for the activities referred to in point (a) of Article 7(1), EUR 1 930 million;
(b)
for the activities referred to in point (b) of Article 7(1), EUR 3 000 million;
(c)
for the activities referred to in point (c) of Article 7(1), EUR 1 580 million;
(d)
for the activities referred to in point (d) of Article 7(1) and in Article 7(3), EUR 561,73 million.
2.
Without prejudice to any amounts allocated to the development of applications based on the systems within Horizon 2020, the budgetary appropriations assigned to the Galileo and EGNOS programmes, including assigned revenues, shall finance the activities as referred to in Article 7(2) up to a maximum of EUR 100 million at constant prices.
3.
The Commission may re-allocate funds from one category of expenditure, as laid down in points (a) to (d) of the third subparagraph of paragraph 1, to another, up to a ceiling of 10 % of the amount referred to in the first subparagraph of paragraph 1. Where the re-allocation reaches a cumulative amount greater than 10 % of the amount referred to in the first subparagraph of paragraph 1, the Commission shall consult the Committee in accordance with the advisory procedure referred to in Article 36(2).
The Commission shall inform the European Parliament and the Council of any re-allocation of funds between categories of expenditure.
4.
The appropriations shall be implemented in accordance with the applicable provisions of this Regulation and Regulation (EU, Euratom) No 966/2012.
5.
Budgetary commitments for the Galileo and EGNOS programmes shall be appropriated in annual instalments.
6.
The Commission shall manage the financial resources referred to in paragraph 1 in a transparent and cost-effective manner. The Commission shall report annually to the European Parliament and the Council on the cost-management strategy pursued.
Article 10Revenue generated by the Galileo and EGNOS programmes
1.
Revenue generated by the exploitation of the systems shall be collected by the Union, paid to the Union budget and allocated to the Galileo and EGNOS programmes, and in particular to the objective referred to in Article 2(1). If the income proves to exceed that required to fund the programme exploitation phases, any adaptation of the principle of allocation shall be approved by the European Parliament and the Council on the basis of a proposal from the Commission.
2.
A revenue-sharing mechanism may be provided for in contracts concluded with private sector entities.
3.
The interest generated by pre-financing payments made to entities responsible for implementing the budget indirectly shall be assigned to activities subject to the delegation agreement or the contract concluded between the Commission and the entity concerned. In accordance with the principle of sound financial management, the entities responsible for indirect implementation of the budget shall open accounts enabling the funds and corresponding interest to be identified.