United in diversity

TEXTS ADOPTEDPART Xat the sitting of

Tuesday15 April 2014

P7_TA-PROV(2014)04-15 PROVISIONAL EDITION PE 531.385

EN EN

EUROPEAN PARLIAMENT 2014 - 2015

CONTENTS

TEXTS ADOPTED

P7_TA-PROV(2014)0387Statistics in trade ***I(A7-0457/2013 - Rapporteur: Hans-Peter Martin)European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 638/2004 on Community statistics relating to trading of goods between Member States as regards conferring of delegated and implementing powers upon the Commission for the adoption of certain measures, the communication of information by the customs administration, the exchange of confidential data between Member States and the definition of statistical value (COM(2013)0578 – C7-0242/2013 – 2013/0278(COD))......1

P7_TA-PROV(2014)0388Securities settlement and central securities depositories ***I(A7-0039/2013 - Rapporteur: Kay Swinburne)European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council on improving securities settlement in the European Union and on central securities depositories (CSDs) and amending Directive 98/26/EC (COM(2012)0073 – C7-0071/2012 – 2012/0029(COD)) 20

P7_TA-PROV(2014)0389Marine equipment ***I(A7-0255/2013 - Rapporteur: Dominique Riquet)European Parliament legislative resolution of 15 April 2014 on the proposal for a directive of the European Parliament and of the Council on marine equipment and repealing Directive 96/98/EC (COM(2012)0772 – C7-0414/2012 – 2012/0358(COD)) 184

P7_TA-PROV(2014)0390Pressure equipment ***I(A7-0008/2014 - Rapporteur: Zuzana Roithová)European Parliament legislative resolution of 15 April 2014 on the proposal for a directive of the European Parliament and of the Council on the harmonisation of the laws of the Member States relating to making available on the market of pressure equipment (recast) (COM(2013)0471 – C7-0203/2013 – 2013/0221(COD))...................................288

P7_TA-PROV(2014)0391Judgments in civil and commercial matters ***I(A7-0052/2014 - Rapporteur: Tadeusz Zwiefka)European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EU) No

PE 531.385\ I

EN

1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (COM(2013)0554 – C7-0239/2013 – 2013/0268(COD))................587

P7_TA-PROV(2014)0392Labour force sample survey ***I(A7-0344/2013 - Rapporteur: Tatjana Ždanoka)European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council amending Council Regulation (EC) No 577/98 on the organisation of a labour force sample survey in the Community (COM(2013)0155 – C7-0086/2013 – 2013/0084(COD))................................................600

P7_TA-PROV(2014)0393European Maritime Safety Agency and response to pollution ***I(A7-0300/2013 - Rapporteur: Keith Taylor)European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council on multiannual funding for the action of the European Maritime Safety Agency in the field of response to pollution caused by ships and to marine pollution caused by oil and gas installations (COM(2013)0174 – C7-0089/2013 – 2013/0092(COD))................................................620

P7_TA-PROV(2014)0394Hospitable environment for enterprises, businesses and start-ups to create jobs(A7-0101/2014 - Rapporteur: Anthea McIntyre)European Parliament resolution of 15 April 2014 on ‘How can the European Union contribute to creating a hospitable environment for enterprises, businesses and start-ups to create jobs?’ (2013/2176(INI)).........................................................................................641

P7_TA-PROV(2014)0395New technologies and open educational resources(A7-0249/2014 - Rapporteur: Cătălin Sorin Ivan)European Parliament resolution of 15 April 2014 on new technologies and open educational resources (2013/2182(INI))...........................................................................657

P7_TA-PROV(2014)0396Voting in the context of procedures concerning the immunity of Members (interpretation of the Rules of Procedure)European Parliament decision of 15 April 2014 concerning voting in the context of procedures concerning the immunity of Members (interpretation of Rules 166, 167(1) and 195(3)) (2014/2028(REG)................................................................................................666

II /PE 531.385

EN

P7_TA-PROV(2014)0387

Statistics in trade ***I

European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 638/2004 on Community statistics relating to trading of goods between Member States as regards conferring of delegated and implementing powers upon the Commission for the adoption of certain measures, the communication of information by the customs administration, the exchange of confidential data between Member States and the definition of statistical value (COM(2013)0578 – C7-0242/2013 – 2013/0278(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2013)0578),

– having regard to Article 294(2) and Article 338(1) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0242/2013),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

having regard to the undertakings given by the Council representative by letter of 19 March 2014 to approve Parliament's position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the report of the Committee on Economic and Monetary Affairs (A7-0457/2013),

1. Adopts its position at first reading hereinafter set out1;

2. Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

1 This position replaces the amendments adopted on 15 January 2014 (Texts adopted P7_TA(2014)0030).

1

P7_TC1-COD(2013)0278

Position of the European Parliament adopted at first reading on 15 April 2014 with a view to the adoption of Regulation (EU) No .../2014 of the European Parliament and of the Council amending Regulation (EC) No 638/2004 on Community statistics relating to trading of goods between Member States as regards conferring delegated and implementing powers on the Commission for the adoption of certain measures, the communication of information by the customs administration, the exchange of confidential data between Member States and the definition of statistical value

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article

338(1) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Acting in accordance with the ordinary legislative procedure1,

1 Position of the European Parliament of 15 April 2014.

2

Whereas:

(1) As a consequence of the entry into force of the Treaty on the Functioning of the

European Union (TFEU), powers conferred on the Commission should be aligned

with Articles 290 and 291 TFEU.

(2) In connection with the adoption of Regulation (EU) No 182/2011 of the European

Parliament and of the Council ▌1, the Commission has committed itself ▌ to

reviewing, in the light of the criteria laid down in the TFEU, legislative acts which

currently contain references to the regulatory procedure with scrutiny.

(3) Regulation (EC) No 638/2004 of the European Parliament and of the Council2 confers

powers on the Commission in order to implement some of its provisions.

(4) In order to align Regulation (EC) No 638/2004 with Articles 290 and 291 TFEU,

implementing powers conferred on the Commission by that Regulation should be

replaced by powers to adopt delegated and implementing acts.

1 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).

2 Regulation (EC) No 638/2004 of the European Parliament and of the Council of 31 March 2004 on Community statistics relating to the trading of goods between Member States and repealing Council Regulation (EEC) No 3330/91 (OJ L 102, 7.4.2004, p. 1).

3

(5) In order to provide a satisfactory response to users' needs for statistical information

without imposing excessive burdens on economic operators, to take into account

changes necessary for methodological reasons and the necessity to set up an efficient

system for the collection of data and the compilation of statistics, the power to adopt

acts in accordance with Article 290 TFEU should be delegated to the Commission in

respect of the adoption of different or specific rules applying to specific goods or

movements, ▌the adaptation of the Intrastat coverage rates, the specification of the

conditions for defining the thresholds referred to in Article 10(4) of Regulation (EC)

No 638/2004, the specification of the conditions for simplifying the information to be

provided for small individual transactions and the definition of the aggregated data ▌.

(6) When adopting delegated acts, it is particularly important for the Commission to

carry out appropriate consultations during its preparatory work, including at expert

level. When preparing and drawing up delegated acts, the Commission should ensure a

simultaneous, timely and appropriate transmission of relevant documents to the

European Parliament and to the Council. The Commission should also ensure that the

delegated acts provided for in the legislative acts do not impose a significant

additional burden on the Member States or on the respondents and that they remain

as economical as possible.

▌

4

(7) In order to ensure uniform conditions for the implementation of Regulation (EC) No

638/2004, implementing powers should be conferred on the Commission enabling it to

adopt the arrangements for collecting information, particularly concerning the codes to

be used, the determination of the breakdown of the estimates, technical provisions for

compiling annual statistics on trade by business characteristics and any measures

necessary to ensure that the quality of the statistics transmitted meets the quality

standards. Those powers should be exercised in accordance with Regulation (EU) No

182/2011.

(8) The Committee for the statistics on the trading of goods between Member States (the

'Intrastat Committee') referred to in Article 14 of Regulation (EC) No 638/2004

provides advice to the Commission and assists it in exercising its implementing

powers.

5

(9) Under the strategy for a new European Statistical System (▌ESS) structure intended to

improve coordination and partnership in a clear pyramid structure within the ESS, the

European Statistical System Committee (▌ESSC), established by Regulation (EC) No

223/2009 of the European Parliament and of the Council1, should have an advisory role

and should assist the Commission in exercising its implementing powers. Improving

coordination between national authorities and the Commission (Eurostat) is key to

producing higher quality statistics in the Union.

(10) Regulation (EC) No 638/2004 should be amended by replacing the reference to the

Intrastat Committee with a reference to the ESSC.

(11) Simplifications of customs clearance schemes have led to the non-availability, at

customs level, of statistical information about goods under customs processing

procedures. To assure coverage of the data, movements of those goods should be

included in the Intrastat system.

1 Regulation (EC) No 223/2009 of the European Parliament and of the Council of 11 March 2009 on European statistics and repealing Regulation (EC, Euratom) No 1101/2008 of the European Parliament and of the Council on the transmission of data subject to statistical confidentiality to the Statistical Office of the European Communities, Council Regulation (EC) No 322/97 on Community Statistics, and Council Decision 89/382/EEC, Euratom establishing a Committee on the Statistical Programmes of the European Communities (OJ L 87, 31.3.2009, p. 164).

6

(12) The exchange of confidential data relating to intra-Union trade statistics should be

allowed between Member States with a view to increasing the efficiency of the

development, production and dissemination or to improving the quality of those

statistics. Such exchanges of confidential data should be voluntary, be treated

carefully and not per se entail an increased administrative burden on undertakings.

(13) The definition of statistical value should be clarified and aligned with the definition of

that data element under the extra-Union trade statistics in order to enable better

comparability between intra-Union and extra-Union trade statistics. Uniform

definitions are essential for the harmonised recording of cross-border trade and are

especially important as a prerequisite to enable national authorities to make

concordant interpretations of rules having an impact on the cross-border activities

of businesses.

(14) In accordance with the principle of proportionality, it is necessary and appropriate to

lay down harmonised rules on the communication of information by the customs

administration, the exchange of confidential data between Member States and the

definition of statistical value in the domain of intra-Union trade statistics. This

Regulation does not go beyond what is necessary to achieve that objective, in

accordance with Article 5(4) of the Treaty on European Union.

7

(15) Data transmission by the national authorities should be free of charge for the

Member States and for the Union institutions and agencies.

(16) It is important to guarantee the security of the modes of transmission of sensitive

statistical data, including economic data.

(17) To ensure legal certainty, procedures for the adoption of measures which have been

initiated but not completed before the entry into force of this Regulation should not be

affected by this Regulation.

(18) Regulation (EC) No 638/2004 should therefore be amended accordingly,

HAVE ADOPTED THIS REGULATION:

8

Article 1

Regulation (EC) No 638/2004 is amended as follows:

(1) in Article 3, paragraph 4 is replaced by the following:

'4. The Commission shall be empowered to adopt delegated acts in accordance with

Article 13a relating to different or specific rules applying to specific goods or

movements.’;

(2) Article 5 is amended as follows:

(a) in paragraph 1, the word ‘Community’ is deleted;

(b) paragraph 2 is replaced by the following:

'2. The statistical information on dispatches and arrivals of goods which are

the subject of a single administrative document for customs or fiscal

purposes shall be provided directly by customs to the national authorities,

at least once a month’;

(c) the following paragraph ▌ is inserted:

'2a. The customs administration responsible in each Member State shall, on its

own initiative or at the request of the national authority, provide the

national authority with any available information to identify the person

who carries out dispatches and arrivals of goods covered by the customs

procedures of inward processing or processing under customs control.';

9

(3) Article 6 ▌is replaced by the following:

▌

'Article 6

Reference period

The reference period for the information to be provided in accordance with Article 5

shall be:

(a) the calendar month of dispatch or arrival of the goods;

(b) the calendar month during which the chargeable event occurs for the

Community goods on which VAT becomes chargeable on intra-Community

acquisitions and supplies; or

(c) the calendar month during which the declaration is accepted by customs where

the customs declaration is used as data sources.’;

(4) in Article 9(1), the second subparagraph is replaced by the following:

'Definitions of the statistical data referred to in points (e) to (h) are laid down in the

Annex. The Commission shall adopt, by means of implementing acts, the

arrangements to collect that information, in particular the codes and the format to be

employed.

Those implementing acts shall be adopted in accordance with the examination

procedure referred to in Article 14(2).’;

10

(5) the following Article ▌is inserted:

'Article 9a

Exchange of confidential data

The exchange of confidential data, as defined in Article 3(7) of Regulation (EC) No

223/2009 of the European Parliament and of the Council ▌*, may take place for

statistical purposes only, between the national authorities responsible in each Member

State, where the exchange serves the efficient development, production and

dissemination of European statistics relating to the trading of goods between Member

States or improves their quality.

National authorities that have obtained confidential data shall treat that information

confidentially and shall use it exclusively for statistical purposes in accordance with

Chapter V of Regulation (EC) No 223/2009.

________________________________________

* Regulation (EC) No 223/2009 of the European Parliament and of the Council

of 11 March 2009 on European statistics and repealing Regulation (EC,

Euratom) No 1101/2008 of the European Parliament and of the Council on

the transmission of data subject to statistical confidentiality to the Statistical

Office of the European Communities, Council Regulation (EC) No 322/97 on

Community Statistics, and Council Decision 89/382/EEC, Euratom

establishing a Committee on the Statistical Programmes of the European

Communities (OJ L 87, 31.3.2009, p. 164).';

11

(6) Article 10 is amended as follows:

(a) in paragraph 3, the second subparagraph is replaced by the following:

'The Commission shall be empowered to adopt delegated acts in accordance with

Article 13a to adapt those Intrastat coverage rates to technical and economic

developments whenever it is possible to reduce them, while maintaining statistics

which meet the quality indicators and standards in force.';

12

(b) in paragraph 4, the second subparagraph is replaced by the following:

'The Commission shall be empowered to adopt delegated acts in accordance with

Article 13a to specify the conditions for defining those thresholds.';

(c) paragraph 5 is replaced by the following:

5. Member States may, under certain conditions that meet quality

requirements, simplify the information to be provided for small individual

transactions provided that such simplification has no detrimental effects

on the quality of the statistics. The Commission shall be empowered to

adopt delegated acts in accordance with Article 13a to specify those

conditions.';

(7) Article 12 is amended as follows:

(a) in paragraph 1, point (a) is replaced by the following:

‘(a) 40 calendar days after the end of the reference month for the aggregated

data to be defined by the Commission. The Commission shall be

empowered to adopt delegated acts in accordance with Article 13a to

define those aggregated data. Those delegated acts shall take into account

the relevant economic and technical developments.';

13

(b) paragraph 2 is replaced by the following:

'2. Member States shall provide the Commission (Eurostat) with monthly

results which cover their total trade in goods by using estimates, where

necessary. The Commission shall by means of implementing acts,

determine the breakdown for such estimates. Those implementing acts

shall be adopted in accordance with the examination procedure referred

to in Article 14(2).';

(c) in paragraph 4, the third subparagraph is replaced by the following:

'The Commission shall adopt, by means of implementing acts, technical

provisions for compiling those statistics in the most economical way.

Those implementing acts shall be adopted in accordance with the examination

procedure referred to in Article 14(2).’;

(8) in Article 13, paragraph 4 is replaced by the following:

'4. The Commission shall adopt, by means of implementing acts, any measures

necessary to ensure the quality of the statistics transmitted in accordance with

the quality criteria, avoiding excessive costs for the national authorities.

Those implementing acts shall be adopted in accordance with the examination

procedure referred to in Article 14(2).';

14

(9) the following Article is inserted:

'Article 13a

Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the

conditions laid down in this Article.

2. When exercising the power delegated in Article 3(4), ▌Article 10(3), (4) and (5)

and point (a) of Article 12(1) ▌ of this Regulation, the Commission shall act in

accordance with Article 14(3) of Regulation (EC) No 223/2009, ensuring, inter

alia, that the delegated acts do not impose a significant additional ▌ burden on

the Member States and on the respondents.

It is of particular importance that the Commission follow its usual practice and

carry out consultations with experts, including Member States' experts, before

adopting those delegated acts.

15

3. The power to adopt delegated acts referred to in Article 3(4), ▌Article 10(3), (4)

and (5) and point (a) of Article 12(1) ▌shall be conferred on the Commission for

a period of five years from …*. The Commission shall draw up a report in

respect of the delegation of power not later than nine months before the end of

the five-year period. The delegation of power shall be tacitly extended for

periods of an identical duration, unless the European Parliament or the

Council opposes such extension not later than three months before the end of

each period.

4. The delegation of power referred to in Article 3(4), ▌ Article 10(3), (4) and (5)

and point (a) of Article 12(1) ▌may be revoked at any time by the European

Parliament or by the Council. A decision to revoke shall put an end to the

delegation of the power specified in that decision. It shall take effect the day

following the publication of the decision in the Official Journal of the European

Union or at a later date specified therein. It shall not affect the validity of any

delegated acts already in force.

5. As soon as it adopts a delegated act, the Commission shall notify it

simultaneously to the European Parliament and to the Council.

* OJ : please insert the date of the entry into force of the amending Regulation.

16

6. A delegated act adopted pursuant to Article 3(4), ▌ Article 10(3), (4) and (5) and

point (a) of Article 12(1) ▌shall enter into force only if no objection has been

expressed either by the European Parliament or the Council within a period of

three months of notification of that act to the European Parliament and the

Council or if, before the expiry of that period, the European Parliament and the

Council have both informed the Commission that they will not object. That

period shall be extended by three months at the initiative of the European

Parliament or the Council.’;

(10) Article 14 is replaced by the following:

'Article 14

Committee procedure

1. The Commission shall be assisted by the European Statistical System Committee

established by Regulation (EC) No 223/2009. That committee shall be a

committee within the meaning of Regulation (EU) No 182/2011 of the European

Parliament and of the Council ▌*.

17

2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No

182/2011 shall apply.

________________________________________

* Regulation (EU) No 182/2011 of the European Parliament and of the Council

of 16 February 2011 laying down the rules and general principles concerning

mechanisms for control by Member States of the Commission’s exercise of

implementing powers (OJ L 55, 28.2.2011, p. 13).’;

▌

18

(11) in the Annex, point 3(b) is replaced by the following:

‘(b) the statistical value, which is the value calculated at the national borders of the

Member States. It shall be based on the taxable amount or, where applicable, the

value replacing it. It includes only incidental expenses (freight, insurance)

incurred, in the case of dispatches, in the part of the journey located on the

territory of the Member State of dispatch and, in the case of arrivals, in the part

of the journey located outside the territory of the Member State of arrival. It is

said to be a fob value (free on board) for dispatches, and a cif value (cost,

insurance, freight) for arrivals.’.

Article 2

This Regulation shall not affect the procedures for the adoption of measures provided for in

Regulation (EC) No 638/2004 that have been initiated but not completed before the entry into

force of this Regulation.

Article 3

This Regulation shall enter into force on the twentieth day following that of its publication in

the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

▌

Done at …,…

For the European Parliament For the CouncilThe President The President

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P7_TA-PROV(2014)0388

Securities settlement and central securities depositories ***I

European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council on improving securities settlement in the European Union and on central securities depositories (CSDs) and amending Directive 98/26/EC (COM(2012)0073 – C7-0071/2012 – 2012/0029(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2012)0073),

– having regard to Article 294(2) and Article 114 of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0071/2012 ),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to the opinion of the European Central Bank of 1 August 20121,

– having regard to the opinion of the European Economic and Social Committee of 11 July 20122,

– having regard to the undertaking given by the Council representative by letter of 26 February 2014 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the report of the Committee on Economic and Monetary Affairs and the opinion of the Committee on Legal Affairs (A7-0039/2013),

1. Adopts its position at first reading hereinafter set out;

2. Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

1 OJ C 310, 13.10.2012, p. 12.2 OJ C 299, 4.10.2012, p. 76.

20

P7_TC1-COD(2012)0029

Position of the European Parliament adopted at first reading on 15 April 2014 with a view to the adoption of Regulation (EU) No .../2014 of the European Parliament and of the Council on improving securities settlement in the European Union and on central securities depositories (CSDs) and amending Directive 98/26/EC*

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article

114 thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Central Bank1,

Having regard to the opinion of the European Economic and Social Committee▌2,

▌

Acting in accordance with the ordinary legislative procedure3,

* THIS TEXT HAS NOT YET UNDERGONE LEGAL-LINGUISTIC FINALISATION.1 OJ C 310, 13.10.2012, p. 12.2 OJ C 299, 4.10.2012, p. 76.3 Position of the European Parliament of 15 April 2014.

21

Whereas:

(1) Central Securities Depositories (CSDs), along with central counterparties (CCPs)

contribute to a large degree in maintaining post trade infrastructures that safeguard

financial markets and give market participants confidence that securities transactions

are executed properly and in a timely manner, including during periods of extreme

stress.

(2) Due to their key position in the settlement process, the securities settlement systems

operated by CSDs are of a systemic importance for the functioning of securities

markets. Playing an important role in the securities holding systems through which

their participants report the securities holdings of investors, the securities settlement

systems operated by CSDs also serve as an essential tool to control the integrity of an

issue, that is hindering undue creation or reduction of issued securities, and thereby

playing an important role in maintaining investor confidence. Moreover, securities

settlement systems operated by CSDs are closely involved in securing collateral for

monetary policy operations as well as in the securing collateral between credit

institutions and are, therefore, important actors in the collateralisation processes.

(3) While Directive 98/26/EC of the European Parliament and of the Council of 19 May

1998 on settlement finality in payment and securities settlement systems1 reduced the

disruption to a securities settlement system caused by insolvency proceedings against a

participant in that system, it is necessary to address other risks that securities

settlement systems are facing, as well as the risk of insolvency or disruption in the

functioning of the CSDs that operate securities settlement systems. A number of CSDs

are subject to credit and liquidity risks deriving from the provision of banking services

ancillary to settlement.

1 OJ L 166, 11.6.1998, p. 45.

22

(4) The increasing number of cross-border settlements as a consequence of the

development of link agreements between CSDs calls into question the resilience, in the

absence of common prudential rules, of CSDs when importing the risks encountered

by CSDs from other Member States. Moreover, despite the increase in cross-border

settlements, market-driven changes towards a more integrated market for CSD

services have proven to be very slow. An open internal market in securities

settlement should allow any investor in the Union to invest in all Union securities

with the same ease and using the same processes as for domestic securities.

However, the settlement markets in the Union remain fragmented across national

borders and cross-border settlement more costly, due to different national rules

regulating settlement and the activities of CSDs and limited competition between

CSDs.

This fragmentation hinders and creates additional risks and costs for cross-border

settlement. Given the systemic relevance of CSDs, competition between them should

be promoted so as to enable market participants a choice of provider and reduce the

reliance on any one infrastructure provider. In the absence of identical obligations

for market operators and common prudential standards for CSDs, likely divergent

measures taken at national level will have a direct negative impact on the safety,

efficiency and competition in the settlement markets in the Union. It is necessary to

remove those significant obstacles in the functioning of the internal market and avoid

distortions of competition and to prevent such obstacles and distortions from arising in

the future. The creation of an integrated market for securities settlement with no

distinction between national and cross-border securities transactions is needed for

the proper functioning of the internal market. Consequently, the appropriate legal

basis for this Regulation should be Article 114 of the Treaty on the Functioning of the

European Union (TFEU), as interpreted in accordance with the consistent case law of

the Court of Justice of the European Union.

23

(5) It is necessary to lay down in a Regulation a number of uniform obligations to be

imposed on market participants regarding certain aspects of the settlement cycle and

discipline and to provide a set of common requirements for CSDs operating securities

settlement systems. The directly applicable rules of a Regulation should ensure that all

market operators and CSDs are subject to identical directly applicable obligations,

standards and rules. A Regulation should increase the safety and efficiency of

settlement in the Union by preventing any diverging national rules as a result of the

transposition of a directive.

A Regulation should reduce the regulatory complexity for market operators and CSDs

resulting from different national rules and should allow CSDs to provide their services

on a cross-border basis without having to comply with different sets of national

requirements such as those concerning the authorisation, supervision, organisation or

risks of CSDs. A Regulation imposing identical requirements on CSDs should also

contribute to eliminating competitive distortions.

24

(6) The Financial Stability Board (FSB) called, on 20 October 20101, for more robust core

market infrastructures and asked for the revision and enhancement of the existing

standards. In April 2012, the Committee on Payments and Settlement Systems (CPSS)

of the Bank of International Settlements (BIS) and the International Organisation of

Securities Commissions (IOSCO) adopted global standards for financial market

infrastructures. These standards have replaced the BIS recommendations from 2001,

which were adapted through non-binding guidelines at European level in 2009 by the

European System of Central Banks (ESCB) and the Committee of European Securities

Regulators (CESR). Considering the global nature of financial markets and the

systemic importance of the CSDs, it is necessary to ensure international convergence

of the prudential requirements to which they are subject. The provisions of this

Regulation should follow the existing principles for financial market infrastructures

recommendations developed by CPSS-IOSCO principles for financial market

infrastructures. The Commission and ESMA, in close cooperation with the members

of the ESCB, should ensure consistency with the existing standards and their future

developments when drawing up or proposing to revise the regulatory technical and

implementing standards as well as the guidelines and recommendations referred to

in this Regulation.

1 FSB "Reducing the moral hazard posed by systemically important financial institutions", 20 October 2010.

25

(7) The Council, in its conclusions of 2 December 20081, emphasised the need to

strengthen the safety and soundness of the securities settlement systems, and to address

legal barriers to post-trading in the Union.

(8) One of the basic tasks of the ESCB is to promote the smooth operation of payment

systems. In this respect, the members of the ESCB execute oversight by ensuring

efficient and sound clearing and payment systems. The members of the ESCB often act

as settlement agents for the cash leg of the securities transactions. They are also

important clients of CSDs, which often manage the collateralisation of monetary

policy operations.

The members of the ESCB should be closely involved, by being consulted, in the

authorisation and supervision of CSDs, recognition of third country CSDs and the

approval of certain CSD links. To prevent the emergence of parallel sets of rules,

they should also be closely involved by being consulted in the setting of regulatory and

implementing technical standards as well as of guidelines and recommendations

although primary responsibility for the setting of such technical standards,

guidelines and recommendations should rest with the Commission and ESMA, as

laid down in this Regulation. The provisions of this Regulation should be without

prejudice to the responsibilities of the European Central Bank (ECB) and the National

Central Banks (NCBs) to ensure efficient and sound clearing and payment systems

within the Union and other countries. This Regulation should not prevent the

members of the ESCB from accessing the information relevant for the performance

of their duties, including their oversight of CSDs and other financial market

infrastructures.

1 Conclusions of 2911th Council meeting, ECOFIN, 2 December 2008.

26

(9) Member States' central banks, any other bodies performing similar functions in certain

Member States or other public bodies charged with or intervening in the management

of the public debt in the Union may themselves provide a number of services, such as

operating a securities settlement system, which would qualify them as a CSD. Such

institutions, when acting as CSDs without establishing a separate entity, should be

exempt from the authorisation and supervision requirements, certain organisational

requirements, capital and investment policy requirements, but should remain subject

to the remaining set of prudential requirements for CSDs. Where such institutions

from a Member State act as CSDs, they should not provide their services in other

Member States. Since central banks act as settlement agents for the purpose of

settlement, they should also be exempt from the requirements set out in Title IV of this

Regulation.

(10) This Regulation should apply to the settlement of transactions in all financial

instruments and activities of CSDs unless specified otherwise. This Regulation should

also be without prejudice to other legislation of the Union concerning specific financial

instruments such as Directive 2003/87/EC of the European Parliament and of the

Council of 13 October 2003 establishing a scheme for greenhouse gas emission

allowance trading within the Community and amending Council Directive 96/61/EC1

and measures adopted in accordance with that Directive.

1 OJ L 275, 25.10.2003, p. 32.

27

(11) Some CSDs operating also as credit institutions are subject to own fund and

reporting requirements relevant for credit institutions and set out in Directive

2013/36/EU and Regulation (EU) No 575/2013. Given the systemic importance of

such CSDs it is appropriate that the strictest requirements provided in the Union law

should apply, in order to avoid cumulative application of various Union rules, for

example in relation to the reporting of own fund requirements. In any areas where

potential duplication of requirements is identified, ESMA and EBA should provide

an opinion on the appropriate application of the Union acts in accordance with

Article 34 of Regulation (EU) No. 1095/2010 and Regulation (EU) No. 1093/2010

respectively.

(12) The recording of securities in book-entry form is an important step to increase the

efficiency of settlement and ensure the integrity of a securities issue, especially in a

context of increasing complexity of holding and transfer methods. For reasons of

safety, this Regulation provides for the recording in book-entry form of all transferable

securities admitted to trading or traded on the trading venues regulated by [new

MiFID/]. This Regulation should not impose one particular method for the initial

book-entry recording, which may take the form of immobilisation ▌ or of immediate

dematerialisation. This Regulation should not impose the type of institution that should

record securities in book-entry form upon issuance and permits different actors,

including registrars, to perform this function. However, once transactions in such

securities are executed on trading venues regulated by Directive ▌ [new MiFID] or

provided as collateral under the conditions of Directive 2002/47/EC of the European

Parliament and of the Council of 6 June 2002 on financial collateral arrangements▌,

such securities should be recorded in a CSD book-entry system in order to ensure, inter

alia, that all such securities can be settled in a securities settlement system.

Immobilisation and dematerialisation should not imply any loss of rights for the

holders of securities and should be achieved in a way that ensures that holders of

securities can verify their rights.

28

(13) In order to ensure the safety of settlement, any participant to a securities settlement

system buying or selling certain financial instruments, namely transferable securities,

money-market instruments, units in collective investment undertakings and emission

allowances, should settle its obligation on the intended settlement date.

(14) Longer settlement periods of transactions in transferable securities cause uncertainty

and increased risk for securities settlement systems participants. Different durations of

settlement periods across Member States hamper reconciliation and are sources of

errors for issuers, investors and intermediaries. It is therefore necessary to provide a

common settlement period which would facilitate the identification of the intended

settlement date and facilitate the implementation of settlement discipline measures.

The intended settlement date of transactions in transferable securities which are

executed on trading venues regulated by ▌[new MiFID/R] should be no later than on

the second business day after the trading takes place. For complex operations

composed of several transactions such as securities repurchase or lending

agreements, this requirement should apply to the first transaction involving a

transfer of securities. Given their non-standardised character, this requirement

should not apply to transactions that are negotiated privately by the relevant parties,

but executed on the trading venues regulated by [new MifID/R] or to transactions

that are executed bilaterally, but reported to a trading venue regulated by [new

MifID/R. Moreover, this requirement should not apply to the first transaction where

transferable securities concerned are subject to initial recording in book-entry form.

29

(15) CSDs and other market infrastructures should take measures to prevent and address

settlement fails. It is essential that such rules be uniformly and directly applied in the

Union. In particular, CSDs and other market infrastructures should be required to put

in place procedures enabling them to take appropriate measures to suspend any

participant that systematically causes settlement fails and to disclose its identity to the

public, provided that that participant has the opportunity to submit observations before

such a decision is taken.

(16) One of the most efficient ways to address settlement fails is to require failing

participants to be subject to a compulsory enforcement of the original agreement.

This Regulation should provide for uniform rules concerning penalties and certain

aspects of the buy-in transaction for all transferable securities, money-market

instruments, units in collective investment undertakings and emission allowances, such

as the timing and pricing. These rules should be adapted to the specificities of

different securities markets, certain trading venues such as SME-growth markets as

defined in Regulation [new MiFIR] and certain complex operations such as very

short term securities repurchase or lending agreements, in order to avoid adversely

impacting on the liquidity and efficiency of securities markets. The rules on

settlement discipline should be applied in such a manner that incentivises the

settlement of transactions in all relevant financial instruments by their intended

settlement date.

30

The procedures and penalties related to settlement fails should be commensurate to the scale

and seriousness of such fails whilst being scaled in such a way that maintains and

protects liquidity of the relevant financial instruments. In particular, market making

activities play a crucial role in providing liquidity to markets within the Union,

particularly to less liquid securities. Measures to prevent and address settlement fails

should be balanced against the need to maintain and protect liquidity in these

securities. Cash penalties imposed on failing participants should be credited where

possible to the non-failing clients as compensation and should not in any case

become a source of revenue for the CSD. CSDs should consult the market

infrastructures in respect of which they provide CSD services on the implementation

of settlement discipline measures provided in this Regulation.

In most cases a buy-in procedure should be initiated where the financial instruments

are not delivered within four days of the intended settlement date. However, for

illiquid financial instruments it is appropriate that the period before initiating the

buy-in procedure should be increased up to a maximum of 7 business days. The

basis for determining when financial instruments are deemed to be illiquid should be

established through regulatory technical standards, taking account of the

assessments already made in Regulation [MiFIR]. Where such a determination is

made the extension of the deadline for initiating the buy-in procedure should be up

to 7 business days.

31

(17) It is appropriate to allow SME growth markets the flexibility not to apply the buy-in

procedure until up to 15 days after the trade has taken place so as to take into

account the liquidity of such markets and to allow, in particular, for activity by

market makers in those less liquid markets. The settlement discipline measures

specific to SME-growth markets should only apply to transactions executed on such

markets. As identified in the Commission Staff Working Paper of 7 December 2011

accompanying the Commission communication entitled, "An action plan to improve

access to finance for SMEs", access to capital markets should be developed as an

alternative to bank lending to SMEs and it is therefore appropriate to tailor rules to

better serve the needs of those SME growth markets.

(18) A CSD should be allowed to monitor the execution of the buy-in with respect to

multiple settlement instructions, on the same financial instruments and with the

same date of expiry of the extension period with the aim of minimising the number

of buy-ins to the extent compatible with the requirements of this Regulation.]

32

(19) As the main purpose of this Regulation is to introduce a number of legal obligations

imposed directly on market operators consisting, inter alia, in the recording in book-

entry form in a CSD of all transferable securities once such securities are traded on

trading venues regulated by Directive ▌[new MiFID] or provided as collateral under

the conditions of Directive 2002/47/EC and in the settling their obligations no later

than on the second business day after trading takes place and as CSDs are responsible

for the operation of securities settlement systems and the application of measures to

provide timely settlement in the Union, it is essential to ensure that all CSDs are safe

and sound and comply at all times with stringent organisational, conduct of business,

including by taking all reasonable steps to mitigate against fraud and negligence,

and prudential requirements established by this Regulation. Uniform and directly

applicable rules regarding the authorisation and ongoing supervision of CSDs are

therefore an essential corollary of and are interrelated with the legal obligations

imposed on market participants by this Regulation. It is, therefore, necessary to include

the rules regarding the authorisation and supervision of CSDs in the same act as the

legal obligations imposed on market participants.

33

(20) Taking into account that CSDs should be subject to a set of common requirements and

in order to dismantle the existing barriers to cross-border settlement, any authorised

CSD should enjoy the freedom to provide its services within the territory of the Union,

including through the establishment of a branch. In order to ensure an appropriate

level of safety in the provision of CSD services by CSDs authorised in another

Member State, such CSDs shall be subject to a specific procedure established in this

Regulation where they intend to provide certain core CSD services listed in this

Regulation.

(21) Within a borderless Union settlement market, it is necessary to define the competences

of the different authorities involved in the application of this Regulation. Member

States should specifically designate the competent authorities responsible for the

application of this Regulation, which should be afforded the supervisory and

investigatory powers necessary for the exercise of their functions. A CSD should be

subject to the authorisation and supervision of the competent authority of its place of

establishment, which is well placed and should be empowered to examine how CSDs

operate on a daily basis, to carry out regular reviews and to take appropriate action

when necessary.

34

That authority should however consult at the earliest stage and cooperate with other

relevant authorities, which include the authorities responsible for the oversight of each

securities settlement system operated by the CSD, the central banks that issue the

most relevant settlement currencies, where applicable, the relevant central banks that

act as settlement agent for each securities settlement system, and, also, where

applicable, the competent authorities of other group entities. This cooperation also

implies exchanges of information between authorities concerned and immediate

information of the authorities involved in case of emergency situations affecting the

liquidity and stability of the financial system in any of the Member States where the

CSD or its participants are established.

CSDs should have in place recovery plans to ensure continuity of their critical

operations. Without prejudice to Directive [BRRD], the competent authorities shall

ensure that an adequate resolution plan is established and maintained for each CSD

in accordance with the relevant national laws of the Member States. Where a CSD

provides its services in another Member State, the competent authority of the host

Member State should be able to request from the competent authority of the home

Member State all information concerning the activities of the CSD that is of

relevance for it. This information may concern in particular the services provided to

CSD users established in the host Member State, the instruments or currencies

processed and may include information on adverse developments, results of risk

assessments and remedial measures, to enable effective co-ordination of supervision.

The home Member State should also have access to any information periodically

reported by the CSD to the host Member State.

35

Where a CSD provides its services in a Member State other than where it is

established▌, including through the establishment of a branch▌, the competent

authority of its place of establishment is mainly responsible for the supervision of that

CSD. When the activities of a CSD in a host Member State have become of

substantial importance for the functioning of the securities markets and the

protection of the investors in that host Member State, the home and host competent

and relevant authorities shall establish cooperation arrangements for the

supervision of the activities of that CSD in the host Member State. The home

competent authority may also decide that those cooperation arrangements envisage

multilateral cooperation, including cooperation of a collegial nature, between the

home competent authority and the competent and relevant authorities from the host

Member States concerned. Such cooperation arrangements, however, should not be

considered colleges of supervisors as set out in Article 21 of Regulation (EU)

1095/2010. No Member State or group of Member States should be discriminated

against directly or indirectly, as a location for CSD and settlement services. While

performing the duties under this Regulation no authority should directly or

indirectly discriminate against any undertaking from another Member State. Subject

to the requirements of this Regulation, a CSD from one Member State should not be

restricted or prevented from settling financial instruments in the currency of another

Member State or in the currency of a third country.

36

(22) This Regulation should not prevent Member States from requiring in their national

laws a specific legal framework for day-to-day cooperation at the national level

between the competent authority of the CSD and other relevant authorities. This

national legal framework should be consistent with the guidelines concerning the

supervisory practices and cooperation between authorities that ESMA may issue

under this Regulation.

(23) Any legal person falling within the definition of a CSD needs to be authorised by the

competent national authorities before starting its activities. In view of taking into

account different business models, a CSD should be defined by reference to certain

core services, which consist of settlement, implying the operation of a securities

settlement system, notary and central securities accounts maintenance services. A CSD

should at least operate a securities settlement system and provide one other core

service. This definition should exclude, therefore, entities which do not operate

securities settlement systems such as registrars, transfer agents, public authorities and

bodies in charge of a registry system established under Directive 2003/87/EC or

central counterparties (CCPs) that are regulated by Regulation (EU) 648/212. This

combination is essential for CSDs to play their role in the securities settlement and in

ensuring the integrity of a securities issue.

37

(24) In order to provide reliable data on the scale of securities settlement outside

settlement systems and ensure that the risks arising can be monitored and addressed,

any institutions other than CSDs that settle securities transactions outside a

securities settlement system should report their settlement activities to competent

authorities. The recipient competent authorities should subsequently transmit that

information to ESMA and inform ESMA of any potential risk resulting from such

settlement activities. Furthermore, ESMA should monitor such settlement activities

and take into account the potential risks that they may create.

(25) In order to avoid any risk taking by the CSDs in other activities than those subject to

authorisation under this Regulation, the activities of the authorised CSDs should be

limited to the provision of services covered by their authorisation and they should not

hold any participation, as defined in the Regulation by reference to the Fourth Council

Directive 78/660/EEC of 25 July 1978 based on Article 54(3)(g) of the Treaty on the

annual accounts of certain types of companies1, or any ownership, direct or indirect, of

20 % or more of the voting rights or capital in any other institutions than the ones

providing similar services unless such a participation is approved by CSDs'

competent authorities on the basis that it does not significantly increase their risk

profile.

(26) In order to ensure the safety in the functioning of the securities settlement systems, the

latter should be operated only by the CSDs or by central banks acting as CSDs

subject to the rules provided in this Regulation ▌.

1 OJ L 222 , 14.8.1978, p. 11.

38

(27) Without prejudice to specific requirements of Member States taxlaw, CSDs should be

authorised to provide services ancillary to their core services that contribute to

enhancing the safety, efficiency and transparency of the securities markets and that do

not create undue risks to their core services. These services should be listed in a non-

exhaustive fashion in this Regulation in order to enable CSDs to respond to future

market developments. Where the provision of such services relates to withholdingand

reporting obligations to the tax authorities, it will continue to be carried out in

accordance with the law of the Member States concerned. In accordance with Article

114(2) TFEU, the power to adopt measures under Article 114(1) does not apply to

fiscal provisions. In Case C-338/01, the Court of Justice of the European Union held

that the words 'fiscal provisions' are to be interpreted as "covering not only the

provisions determining taxable persons, taxable transactions, the basis of imposition,

and rates of and exemptions from direct and indirect taxes, but also those relating to

arrangements for the collection of such taxes."

This Regulation does not therefore cover arrangements for the collection of taxes for

which a separate legal basis would need to be used.

39

(28) A CSD intending to outsource a core service to a third party or to provide a new core

service or an ancillary service not listed in this Regulation, to operate another

securities settlement system, to use another ▌ settlement agent or to set up any CSD

links that involve significant risks should apply for authorisation following the same

procedure as that required for initial authorisation, with the exception that the

competent authority should inform the applicant CSD within three months whether

authorisation has been granted or refused. However, CSD links not involving

significant risks or interoperable links of CSDs that outsource their services related

to these interoperable links to public entities, such as the members of the ESCB,

should not be subject to prior authorisation, but should be notified by the relevant

CSDs to their competent authorities.

(29) Where a CSD intends to extend its services to ancillary services explicitly listed in

this Regulation which do not entail an increase in its risk profile , it should be able

to do so following notification to the competent authority.

40

(30) CSDs established in third countries may offer their services in the Union, including

through the establishment of a branch. In order to ensure an appropriate level of

safety in the provision of CSD services by third country CSDs, such CSDs shall be

subject to recognition by ESMA where they intend to provide certain services listed

in this Regulation. Third-country CSDs should be able to set up links with CSDs

established in the Union in the absence of such recognition provided that the

relevant competent authority does not object. In view of the global nature of financial

markets, ESMA is best placed to recognise third country CSDs. ESMA should be able

to recognise third country CSDs only if the Commission concludes that they are

subject to a legal and supervisory framework effectively equivalent to the one

provided in this Regulation, if they are effectively authorised▌, supervised and subject

to oversight in their country and if cooperation arrangements have been established

between ESMA and the competent and relevant authorities of CSDs. Recognition by

ESMA is subject to an effective equivalent recognition of the prudential framework

applicable to CSDs established in the Union and authorised under this Regulation.

41

▌

(31) Considering the complexity as well as the systemic nature of the CSDs and of the

services they provide, transparent governance rules should ensure that senior

management, ▌ members of the management body, shareholders and participants,

who are in a position to exercise control, as defined by reference to the Seventh

Council Directive 83/349/EEC of 13 June 1983 based on Article 54(3)(g) of the Treaty

on consolidated accounts▌, over the operation of the CSD▌ are suitable to ensure the

sound and prudent management of the CSD.

(32) Within Member States different governance structures are used, in most cases a

unitary and/or a dual board structure. The definitions used in th Regulation should

embrace all existing structures without advocating any particular structure. They

are purely functional for the purpose of setting out rules aimed at a particular

outcome irrespective of the national company law applicable to an institution in

each Member State. The definitions shall therefore not interfere with the general

allocation of competencies according to the national company law.

(33) Transparent governance rules should ensure that the interests of the shareholders, the

management and staff of the CSD, on the one hand, and the interests of their users who

CSDs are ultimately serving, on the other, are taken into account. Those governance

principles should apply without prejudice to the ownership model adopted by the CSD.

User committees should be established for each securities settlement system operated

by the CSD to give users the opportunity to advise the management body of the CSD

on the key issues that impact them and should be given the tools to perform their

role. The interests of different users of CSDs, including those of holders of different

types of securities, should be represented in the user committee.

42

(34) CSDs should be able to outsource the operation of their services provided that the

risks arising from such outsourcing arrangements are managed. Considering the

importance of the tasks entrusted to CSDs, this Regulation should provide that CSDs

do not transfer their responsibilities to third parties through the outsourcing by

contract of their activities to third parties. Outsourcing of such activities should be

subject to strict conditions that maintain the ▌responsibility of CSDs for their activities

and ensure that the supervision and oversight of the CSDs are not impaired.

Outsourcing by a CSD of its activities to public entities may, under certain conditions,

be exempted from these requirements.

(35) This Regulation should not prevent Member States allowing direct holding systems

from providing in their national laws that parties other than CSDs shall or may

perform certain functions, which in some other types of securities holding systems

are typically performed by CSDs and specifying how these functions should be

exercised. In particular, in some Member States account operators or participants in

the securities settlement systems operated by CSDs record entries into securities

accounts maintained by CSDs without necessarily being account providers

themselves. In view of the need for legal certainty on the entries made into accounts

at the CSD level, the specific role played by such other parties should be recognised

by this Regulation. It should therefore be possible, under specific circumstances and

subject to strict rules laid down by law, to either share the responsibility between a

CSD and the relevant other party or to provide for exclusive responsibility for that

other party for certain aspects related to maintaining of securities accounts at the

top tier level provided that such other party is subject to appropriate regulation and

supervision. There should be no restrictions on the extent to which responsibility is

shared.

43

(36) Conduct of business rules should provide transparency in the relations between the

CSD and its users. In particular, a CSD should have publicly disclosed, transparent,

objective and non-discriminatory criteria for participation to the securities settlement

system, which would allow restricting access of the participants only on the basis of

the risks involved. A quick and appropriate remedy should be made available to

competent authorities to address any unjustified refusal of CSDs to provide their

services to participants. A CSD should publicly disclose prices and fees for its

services. In order to provide open and non-discriminatory access to CSD services and

in view of the significant market power that CSDs still enjoy on the territory of their

respective Member States, a CSD may not diverge from its published pricing policy

for its core services and should maintain separate accounts for the costs and

revenues associated with each of its core services and with its ancillary services.

These participation provisions complement and reinforce the right of market

participants to use a settlement system in another Member State provided for in

Directive ▌[new MiFID] .

(37) In order to facilitate efficient recording, settlement and payment, CSDs should

accommodate in their communication procedures with participants and with the

market infrastructures they interface with, the relevant international open

communication procedures and standards for messaging and reference data.

44

(38) Considering the central role of securities settlement systems in the financial markets,

CSDs should, when providing their services, make their best effort to ensure the

timely settlement of securities transactions and the integrity of the securities issue.

This Regulation should not interfere with the national laws of the Member States

regulating the holdings of securities and the arrangements maintaining the integrity

of securities issues. However, in order to enhance the protection of their

participants' and their clients' assets, this Regulation should require CSDs to

segregate the securities accounts maintained for each participant and ▌ offer, upon

request, further segregation of the accounts of the participants' clients which in some

cases might only be available at a higher cost to be borne by the participants' clients

requesting further segregation. CSDs and their participants should be required to

provide for both omnibus client segregation and individual client segregation so

clients can choose the level of segregation they believe is appropriate to their needs.

The only exclusion from this should be where due to other public policy

requirements, notably in relation to efficient and transparent collection of taxation,

a CSD and its participants are required to provide individual client segregation for

citizens and residents of and legal persons established in a Member State where, at

the date of entry into force of this Regulation, this individual client segregation is

required under the national law of the Member State under which the securities are

constituted and only for citizens, residents of and legal persons established in that

Member State. CSDs should ensure that these requirements apply separately to each

securities settlement system operated by them. Without prejudice to the provision of

ancillary services, CSDs should not use on their own account the securities that

belong to a participant unless explicitly authorised by that participant and should

not otherwise use on their own account the securities that do not belong to them. In

addition the CSD should require the participants to obtain any necessary prior

consents from its clients.

45

(39) Directive 98/26/EC provides that transfer orders entered into securities settlement

systems in accordance with the rules of those systems should be legally enforceable

and binding on third parties. However, considering that Directive 98/26/EC does not

specifically refer to CSDs that operate securities settlement systems, for clarity, this

Regulation should require CSDs to define the moment or moments at which transfer

orders are entered into their systems and become irrevocable in accordance with the

rules of that Directive. In addition, in order to increase legal certainty, CSDs should

disclose to their participants the moment in time at which the transfer of securities

and cash in a securities settlement system are legally enforceable and binding on

third parties in accordance, as the case may be, with the rules provided in national

law. CSDs should also take all reasonable steps to ensure that transfers of securities

and cash are legally enforceable and binding on third parties no later than at the

end of the business day of the actual settlement date.

(40) In order to avoid settlement risks due to the insolvency of the settlement agent, a CSD

should settle, whenever practical and available, the cash leg of the securities

transaction through accounts opened with a central bank. If this option is not practical

and available, a CSD should be able to settle through accounts opened with a credit

institution established under the conditions provided in Directive 2013/36/EU of the

European Parliament and of the Council of 26 June 2013 on access to the activity of

credit institutions and the prudential supervision of credit institutions▌ and

investment firms and subject to a specific authorisation procedure and prudential

requirements provided in Title IV of this Regulation.▌

46

(41) Banking services ancillary to settlement involving credit and liquidity risks should

only be undertaken by CSDs or outsourced to entities authorised to run the banking

services ancillary to the CSD activities as described under this Regulation.

(42) In order to secure the efficiencies resulting from the provision of both CSD and

banking services within the same group of undertakings, the requirements of this

Regulation should not prevent that credit institution from belonging to the same

group of undertakings as the CSD. It is appropriate to provide for arrangements

under which CSDs may be authorised to provide ancillary services from within the

same legal entity to their participants and to other entities. Wherever a credit

institution other than a central bank acts as settlement agent, the credit institution

should be able to provide to the CSD's participants the services set out in this

Regulation, which are covered by the authorisation, but should not provide other

banking services from the same legal entity in order to limit the settlement systems’

exposure to the risks resulting from the failure of the credit institution.

(43) Considering that Directive 2013/36/EU does not address specifically intraday credit

and liquidity risks resulting from the provision of banking services ancillary to

settlement, credit institutions and CSDs providing such services should also be subject

to specific enhanced credit and liquidity risk mitigation requirements, including a

risk-based capital surcharge which reflects the relevant risks, including credit and

liquidity risks, arising from the provision of intraday credit in relation to each

securities settlement system in respect of which they act as settlement agents. Such

enhanced credit and liquidity risk mitigation requirements should follow the global

standards for financial market infrastructures and the principles for ‘Monitoring

tools for intraday liquidity management’ published in April 2013 by the Basel

Committee on Banking Supervision.

47

In addition to the own fund requirements provided in Directive 2013/36/EU and

Regulation (EU) No 575/2013, credit institutions and CSDs should be subject to a

capital surcharge that reflects the risks, such as credit and liquidity risks, resulting

from the provision of intraday credit to, amongst others, the participants to a

securities settlement system or other users of CSD services.

(44) In order to ensure full compliance with specific measures aimed at mitigating credit

and liquidity risks, the competent authorities should be able to require CSDs to

designate more than one credit institution whenever they can demonstrate, based on the

available evidence, that the exposures of one credit institution to the concentration of

credit and liquidity risks is not fully mitigated. CSDs should also be able to designate

more than one credit institution.

(45) Supervision of the compliance of designated credit institutions or CSDs authorised

to provide banking services ancillary to settlement with the requirements of Directive

2013/36/EU and Regulation (EU) No 575/2013 and the specific relevant prudential

requirements of this Regulation should be entrusted to the competent authorities

referred to in Regulation (EU) No 575/2013 of the European Parliament and of the

Council of 26 June 2013 on prudential requirements for credit institutions and

investment firms. In order to ensure consistent application of supervisory standards,

it is desirable that the banking services of CSDs which are of a scale and nature to

pose a significant risk to the financial stability of the Union are directly supervised

by the European Central Bank (ECB) under the conditions provided in Regulation

(EU) No. 1024/2013 concerning policies relating to the prudential supervision of

credit institutions. This Regulation should be without prejudice to Regulation (EU)

No 1024/2013

48

(46) A credit institution or a CSD authorised to provide banking services ancillary to

settlement should comply with any present or future Union legislation applicable to

credit institutions. This Regulation should be without prejudice to any future Union

legislation establishing a framework for the recovery and resolution of credit

institutions and other financial institutions.

(47) In order to provide a sufficient degree of safety and continuity of the services provided

by the CSDs, the CSD should be subject to specific uniform and directly applicable

prudential and capital requirements which do mitigate their legal, operational and

investment risks.

(48) The safety of the link arrangements set up between CSDs should be subject to specific

requirements to enable the access of their respective participants to other securities

settlement systems. The provision of banking type of ancillary services in separate

legal entity should not prevent CSDs from receiving such services, in particular when

they are participants in a securities settlement system operated by another CSD. It is

particularly important that any potential risks resulting from the link arrangements

such as credit, liquidity, organisational or any other relevant risks for CSDs are fully

mitigated. For interoperable links, it is important that linked securities settlement

systems have identical moments of entry of transfer orders into the system and

irrevocability of transfer ▌and use equivalent rules concerning the moment of finality

of transfers of securities and cash. The same principles should apply to CSDs that use a

common settlement information technology (IT) infrastructure.

49

(49) In order to allow competent authorities to effectively supervise the activities of CSDs,

CSDs should be subject to strict record keeping requirements under this Regulation.

CSDs should maintain for a period of at least ten years all the records and data on

all the services that they may provide, including transaction data on collateral

management services that involve the processing of securities repurchase or lending

agreements. CSDs might need to specify a common format in which their clients

provide transaction data so as to allow this record keeping requirement to be met, in

conformity with any relevant regulatory and implementing technical standards

under this Regulation.

(50) In many Member States issuers are required by national law to issue certain types of

securities, notably shares, within their national CSDs. In order to remove this barrier to

the smooth functioning of the Union post-trading market and to allow issuers to opt for

the most efficient way for managing their securities, issuers should have the right to

choose any CSD established in the Union for recording their securities and receiving

any relevant CSD services. Since harmonisation of national corporate laws is beyond

the scope of this Regulation, such national corporate laws or other similar laws

under which the securities are constituted should continue to apply and

arrangements be made to ensure that the requirements of such national corporate

and other similar laws can be met where the right of choice of CSD is exercised.

50

Such national corporate and other similar laws under which the securities are constituted

govern the relationship between their issuer and holders or any third parties, and

their respective rights and duties attached to the securities such as voting rights,

dividends and corporate actions. A refusal to provide services to an issuer should

only be permissible based on a comprehensive risk analysis or if that CSD does not

provide any issuance services in relation to securities constituted under the

corporate law or other similar law of the relevant Member State. A quick and

appropriate remedy should be made available to competent authorities to address any

unjustified refusal of CSDs to provide their services to issuers. ▌

(51) In view of the increasing cross-border holdings and transfers of securities enhanced

by this Regulation, it is of the utmost urgency and importance to establish clear

rules on the law applicable to proprietary aspects in relation to the securities held in

the accounts maintained by CSDs. Nevertheless, this is a horizontal issue which goes

beyond the scope of this Regulation and could be dealt with in future Union

legislation.

51

(52) The European Code of Conduct for Clearing and Settlement of 7 November 2006▌

created a voluntary framework to enable access between CSDs and other market

infrastructures. However, the post-trade sector remains fragmented along national

lines, making cross-border trades ▌ unnecessarily costly. It is necessary to lay down

uniform conditions for links between CSDs and of access between CSDs and other

market infrastructures. In order to enable CSDs to offer their participants access to

other markets, they should have a right to become a participant of another CSD or

request another CSD to develop special functions for having access to the latter. Such

access should be granted on fair, reasonable and non-discriminatory terms and

should only be rejected when it threatens the smooth and orderly functioning of the

financial markets or causes systemic risk. A quick and appropriate remedy should be

made available to competent authorities to address any unjustified refusal of a CSD to

grant access to another CSD. Where CSD links ▌ introduce significant risks for

settlement, they should be subject to authorisation and increased supervision by the

relevant competent authorities.

52

(53) CSDs should also have access to transaction feeds from a CCP or a trading venue and

those market infrastructures should have access to the securities settlement systems

operated by the CSDs. Such access may only be rejected when it threatens the

smooth and orderly functioning of the financial markets or causes systemic risk and

may not deny a request on the grounds of loss of market share.

A quick and appropriate remedy should be made available to competent authorities to

address any unjustified refusal of CSDs or market infrastructures to provide access to

their services. This Regulation completes the access arrangements laid down in

Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4

July 2012 on OTC derivatives, central counterparties and trade repositories1 and in

Regulation (EU) No .../... on markets in financial instruments [MiFIR] between

trading venues, CCPs, and CSDs necessary to establish a competitive internal

market in post-trade services. ESMA and the Commission should continue to closely

monitor the evolution of post-trade infrastructure and the Commission should,

where necessary, intervene in order to prevent competitive distortions from

occurring in the internal market.

1 OJ L 201, 27.7.2012, p. 1.

53

(54) A sound prudential and conduct of business framework for the financial sector should

rest on strong supervisory and sanctioning regimes. To this end, supervisory

authorities should be equipped with sufficient powers to act and should be able to rely

on deterrent sanctioning regimes to be used against any unlawful conduct. A review of

existing sanctioning powers and their practical application aimed at promoting

convergence of sanctions across the range of supervisory activities has been carried out

in the Communication of 8 December 2010 from the Commission to the European

Parliament, the Council, the European Economic and Social Committee and the

Committee of the Regions on reinforcing sanctioning in the financial services sector.

(55) Therefore, in order to ensure effective compliance by CSDs, credit institutions

designated as settlement agents, the members of their management bodies and any

other persons who effectively control their business or any other persons with the

requirements of this Regulation, competent authorities should be able to apply

administrative sanctions and measures which are effective, proportionate and

dissuasive.

(56) In order to provide deterrence and consistent application of the sanctions across

Member States, this Regulation should provide for a list of key administrative

sanctions and measures that need to be available to the competent authorities, for the

power to impose those sanctions and measures on all persons, whether legal or natural,

responsible for a breach, for▌ a list of key criteria when determining the level and type

of those sanctions and measures and for levels of administrative pecuniary sanctions.

Administrative fines should take into account factors such as any identified financial

benefit resulting from the breach, the gravity and duration of the breach, any

aggravating or mitigating factors, the need for fines to have a deterrent effect and,

where appropriate, include a discount for cooperation with the competent authority.

The adoption and publication of sanctions should respect fundamental rights as laid

down in the Charter of Fundamental Rights of the European Union, in particular the

rights to respect for private and family life (Article 7), the right to the protection of

personal data (Article 8) and the right to an effective remedy and to a fair trial (Article

47).

54

(57) In order to detect potential breaches, effective mechanisms to encourage reporting of

potential or actual breaches of this Regulation to the competent authorities should be

put in place. These mechanisms should include adequate safeguards for the persons

who report potential or actual breaches of this Regulation and the persons accused of

such breaches. Appropriate procedures should be established to comply with the

accused person's right to protection of personal data, with the right of defence and to

be heard before the adoption of a final decision affecting that person as well as with

the right to seek effective remedy before a tribunal against any decision or measure

affecting that person.

(58) This Regulation should be without prejudice to any provisions in the law of Member

States relating to criminal sanctions.

(59) Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995

on the protection of individuals with regard to the processing of personal data and on

the free movement of such data1 governs the processing of personal data carried out in

the Member States pursuant to this Regulation. Any exchange or transmission of

personal data by competent authorities of the Member States should be undertaken in

accordance with the rules on the transfer of personal data as laid down in Directive

95/46/EC. Regulation (EC) No 45/2001 of the European Parliament and of the Council

of 18 December 2000 on the protection of individuals with regard to the processing of

personal data by the Community institutions and bodies and on the free movement of

such data2 governs the processing of personal data carried out by ESMA pursuant to

this Regulation. Any exchange or transmission of personal data carried out by ESMA

should be in accordance with the rules on the transfer of personal data as laid down in

Regulation (EC) No 45/2001.

1 OJ L 281, 23.11.1995, p.31.2 OJ L 8, 12.1.2001, p. 1.

55

(60) This Regulation complies with the fundamental rights and observes the principles

recognised in particular by the Charter of Fundamental Rights of the European Union,

notably the rights to respect for private and family life, the right to the protection of

personal data, the right to an effective remedy or to a fair trial, the right not to be tried

or punished twice for the same offence, the freedom to conduct a business, and has to

be applied in accordance with those rights and principles.

(61) European Securities and Markets Authority (ESMA), established by Regulation (EU)

No 1095/2010 of the European Parliament and of the Council of 24 November 2010

establishing a European Supervisory Authority (ESMA), amending Decision No

716/2009/EC and repealing Commission Decision 2009/77/EC1, should play a central

role in the application of this Regulation by ensuring consistent application of Union

rules by national competent authorities and by settling disagreements between them. In

addition, ESMA shall submit annual reports to the Commission assessing the trends

and potential risks in the markets covered by this Regulation.

1 OJ L 331, 15.12.2010, p. 84.

56

These reports should include at least an assessment of settlement efficiency, internalised

settlement, cross-border provision of services, the reasons for the rejection of access

rights and any other material barriers to competition in post-trade financial services

including any arising from the inappropriate use of licensing arrangements,

appropriateness of penalties for settlement fails, in particular the need for additional

flexibility in relation to penalties for settlement fails in relation to illiquid financial

instruments and the application of Member States' rules on civil liability to losses

attributable to CSDs, the conditions relating to the provision of banking type of

ancillary services and the sanctions regime and may contain, where necessary,

recommendations of preventative or remedial actions. ESMA should also conduct

peer reviews covering the activities of the competent authorities under this

Regulation within an appropriate time frame and in accordance with the rules of

Regulation (EU) No 1095/2010. Given the systemic importance of CSDs and the

fact that they are being regulated for the first time at Union level, it is appropriate to

require that such peer reviews should initially occur every three years at least in

relation to the supervision of CSDs which make use of the freedom to provide

services or participate in an interoperable link.

(62) As a body with highly specialised expertise regarding securities and securities markets,

it is efficient and appropriate to entrust ESMA with the elaboration of draft regulatory

and implementing technical standards which do not involve policy choices, for

submission to the Commission. Whenever specified, ESMA should also ▌ closely

cooperate with the members of the ESCB and the European Banking Authority (EBA),

established by Regulation (EU) No 1093/2010 of the European Parliament and the

Council of 24 November 2010 establishing a European Supervisory Authority

(European Banking Authority), amending Decision No 716/2009/EC and repealing

Commission Decision 2009/78/EC1.

1 OJ L 331, 15.12.2010, p. 12.

57

(63) The Commission should be empowered to adopt regulatory technical standards in

accordance with Article 290 of the Treaty on the Functioning of the European Union

and with the procedure set out in Articles 10 to 14 of Regulation (EU) No 1095/2010

and 10 to 14 of Regulation (EU) No 1093/2010 with regard to the detailed elements

of the settlement discipline measures; the reporting of internalised settlement;

information and other elements to be included by a CSD in its application for

authorisation; conditions under which the competent authorities of CSDs may

approve their participations in the capital of certain legal entities, the information

that different authorities shall supply each other when supervising the CSDs; the

information that the applicant CSD shall provide ESMA in its application for

recognition; the elements of the governance arrangements for CSDs; the details of the

records to be kept by CSDs; the risks to be taken into account by CSDs when

carrying out a comprehensive risk assessment, and competent authorities assessing

the reasons for refusal of requests for access;the details of the measures to be taken

by CSDs so that the integrity of the issue is maintained; the ▌mitigation of the

operational and investment risks and of the risks derived from the CSD links; the

details of the capital requirements for CSDs; the elements of the procedure for access

of participants and issuers to CSDs, access between CSDs and between CSDs and

other market infrastructures; the details of the application for authorisation to

provide banking ancillary services; the prudential requirements on credit and

liquidity risks for the CSDs and designated credit institutions that are authorised to

provide banking ancillary services.

58

(64) The Commission should also be empowered to adopt implementing technical standards

by means of implementing acts pursuant to Article 291 TFEU and in accordance with

the procedure set out in Article 15 of Regulation (EU) No 1095/2010 with regard to

standard forms and templates for the reporting on internalised settlement; the

application for authorisation by CSDs; for the provision of information between

different competent authorities for the purposes of supervision of CSDs; for the

relevant cooperation arrangements between home and host authorities; for formats of

records to be kept by CSDs; for the procedures in cases when a participant or an issuer

is denied access to a CSD, CSDs are denied access between themselves or between

CSDs and other market infrastructures; for the consultation of different authorities

prior to granting authorisation to a settlement agent.

(65) The Commission should be empowered to adopt delegated acts in accordance with

Article 290 of the Treaty. In particular, the delegated acts should be adopted in respect

of specific details concerning some definitions, level of cash penalties for the

participants that cause settlement fails, the criteria under which the operations of a

CSD in a host Member State should be considered of substantial importance for that

Member State; It is of particular importance that the Commission carry out

appropriate consultations during its preparatory work, including at expert level.

(66) In order to ensure uniform conditions for the implementation of this Regulation,

implementing powers should be conferred on the Commission to take decisions on the

assessment of rules from third countries for the purposes of recognition of third

country CSDs▌. Those powers should be exercised in accordance with Regulation

(EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011

laying down the rules and general principles concerning mechanisms for control by the

Member States of the Commission's exercise of implementing powers▌.

59

(67) When assessing the relevant rules of third countries, a proportionate, outcomes-

based approach should be taken, focusing on compliance with applicable Union

requirements and, where relevant, international standards. Conditional or interim

recognition may also be granted where there are no areas of material difference that

would have foreseeable detrimental effects on EU markets.

(68) Since the objectives of this Regulation, namely to lay down uniform requirements for

settlement as well as for CSDs, cannot be sufficiently achieved by the Member States

and can therefore, by reason of the scale of the action, be better achieved at Union

level, the Union may adopt measures, in accordance with the principle of subsidiarity

as set out in Article 5 of the Treaty on European Union. In accordance with the

principle of proportionality, as set out in that Article, this Regulation does not go

beyond what is necessary in order to achieve those objectives.

(69) It is necessary to amend Directive 98/26/EC to bring it in line with the Directive

2010/78/EU of the European Parliament and of the Council of 24 November 2010

amending Directives 98/26/EC, 2002/87/EC, 2003/6/EC, 2003/41/EC, 2003/71/EC,

2004/39/EC, 2004/109/EC, 2005/60/EC, 2006/48/EC, 2006/49/EC and 2009/65/EC in

respect of the powers of the European Supervisory Authority (European Banking

Authority), the European Supervisory Authority (European Insurance and

Occupational Pensions Authority) and the European Supervisory Authority (European

Securities and Markets Authority)1, whereby designated securities settlement systems

are no longer notified to the Commission but to ESMA.

1 OJ L 331, 15.12.2010, p. 120

60

(70) Considering that this Regulation harmonises at Union level the measures to prevent

and address settlement fails and has a wider scope of application for such measures

than Regulation (EU) No 236/2012 of the European Parliament and of the Council

of 14 March 2012 on short selling and certain aspects of credit default swaps, it is

necessary to repeal Article 15 of that Regulation.

(71) CSDs should be exempted from the application of Directive [new MiFID] and

Regulation [new MiFIR proposal] where they provide services that are explicitly

listed in this Regulation. However, in order to ensure that any entities providing

investment services and activities are subject to Directive [new MiFID] and

Regulation [new MiFIR] and to avoid competitive distortions between different types

of providers of the such services, it is necessary to require CSDs that provide

investment services and activities in the course of their ancillary services to be

subject to the requirements of Directive [MiFID proposal] and Regulation [MiFIR

proposal].

(72) The application of the authorisation and recognition requirements of this Regulation

should be deferred in order to provide CSDs established in the Union or in third

countries with sufficient time to apply for authorisation and recognition of their

activities provided for in this Regulation. Until the decision is made under this

Regulation on the authorisation or recognition of CSDs and of their activities,

including CSD links, the respective national rules on authorisation and recognition

of CSDs shall continue to apply.

(73) It is also necessary to defer the application of the requirements of recording certain

transferable securities in book-entry form and settling obligations in securities

settlement systems no later than on the second business day after the trading in order to

provide market participants, holding securities in paper form or using longer settlement

periods, with sufficient time to comply with those requirements.

HAVE ADOPTED THIS REGULATION:

61

▌TITLE I

Subject matter, scope and definitions

Article 1

Subject matter and scope

1. This Regulation lays down uniform requirements for the settlement of financial

instruments in the Union and rules on the organisation and conduct of central securities

depositories to promote safe, efficient and smooth settlement.

2. This Regulation applies to the settlement of all financial instruments and activities of

CSDs unless otherwise specified in the provisions of this Regulation.

3. This Regulation is without prejudice to provisions of Union law concerning specific

financial instruments, in particular Directive 2003/87/EC.

4. Articles 10 to 20, 22 to 24, 27, 28(6), 30(4), 46 and 47, the provisions of Title IV and

the requirements to report to competent authorities or relevant authorities or to

comply with their orders under this Regulation, do not apply to the members of the

European System of Central Banks (ESCB), other Member States' national bodies

performing similar functions, or to other public bodies charged with or intervening in

the management of the public debt in the European Union in relation to any CSD

which the aforementioned bodies directly manage under the responsibility of the

same management body, which has access to the funds of that body and which is not

a separate entity.

Article 2

Definitions

1. For the purposes of this Regulation, the following definitions apply:

(1) ‘central securities depository’ ('CSD') means a legal person that operates a

securities settlement system listed in point 3 of Section A of the Annex and

performs at least one other core service listed in Section A of the Annex;

62

(2) 'third country CSD' means any legal entity established in a third country that

provides a similar service to the core service listed in point 3 of Section A of

the Annex and performs at least one other core service listed in Section A of

the Annex;

(3) ‘Immobilisation’ means the act of concentrating the location of physical

securities in a CSD in a way that enables subsequent transfers to be made by

book entry;

Technical Group 15 11:

(4) ‘Dematerialised form’ means financial instruments which exist only as book

entry records;

(5) ‘receiving CSD’ means the CSD which receives the request of another CSD,

the requesting CSD, to have access to its services through a CSD link.

(6) ‘requesting CSD’ means the CSD which requests access to the services of

another CSD, the receiving CSD through a CSD link;

(7) 'settlement' means the completion of a securities transaction wherever it is

concluded with the aim of discharging the obligations of the parties to that

transaction through the transfer of funds or securities, or both;

Instrument definition

(8) ‘financial instruments’ means financial instruments as defined in point (14) of

Article 4 of [ Directive.../.../EU [new MiFID II];].

(9) 'securities settlement system' means a system under the first▌, second and third

indents of point (a) of Article 2 of Directive 98/26/EC that is not operated by a

CCP whose activity consists of the execution of transfer orders as defined in the

second indent of point (i) of Article 2 of Directive 98/26/EC;

63

(10) 'settlement internaliser' means any institution including those authorised in

accordance with Directive 2013/36/EU or with Directive.../..../EU [new MiFID]

which executes transfer orders on behalf of clients or on its own account other

than through a securities settlement system;

(11) 'transfer order' means transfer order as defined in the second indent of point

(i) or Article 2 of Directive 98/26/EC:

(12) 'settlement period' means the time period between the trade date and the intended

settlement date;

(13) 'business day' means business day as defined in point (n) of Article 2 of Directive

98/26/EC;

(14) 'settlement fail' means the non-occurrence of settlement or only partial

settlement of a securities transaction on the intended settlement date, due to a

lack of securities or cash▌ regardless of the underlying cause;

(15) 'intended settlement date' means the date that is entered into the securities

settlement system as the settlement date and on which the parties to a securities

transaction agree that settlement is to take place;

(16) 'central counterparty' or ' CCP' means a CCP as defined in point (1) of Article

2 of Regulation (EU) No 648/2012;

(17) 'competent authority' means the authority designated by each Member State in

accordance with Article 11;

(18) 'relevant authority' means any authority referred to in Article 12;

64

(19) 'participant' means any participant, as defined in point (f) of Article 2 of

Directive 98/26/EC▌ to a securities settlement system;

(20) ‘participation’ means participation within the meaning of the first sentence of

Article 17 of Directive 78/660/EEC, or the ownership, direct or indirect, of 20 %

or more of the voting rights or capital of an undertaking;

(21) ‘home Member State’ means the Member State in which a CSD is established;

(22) ‘host Member State’ means the Member State, other than the home Member

State, in which a CSD has a branch or provides CSD services;

(23) ‘branch’ means a place of business other than the head office which is a part of a

CSD, which has no legal personality and which provides CSD services for which

the CSD has been authorised;

(24) ‘control’ means the relationship between two undertakings as described in

Article 1 of Directive 83/349/EEC;

(25) 'participant's default' means a situation where insolvency proceedings, as defined

in point (j) of Article 2 of Directive 98/26/EC, are opened against a participant;

(26) 'delivery versus payment' (or 'DVP') means a securities settlement mechanism

which links a transfer of securities with a transfer of funds in a way that the

delivery of securities occurs if and only if the corresponding transfer of funds

occurs and vice versa;

65

(27) 'securities account' means an account on which securities may be credited or

debited;

(28) 'CSD link' means an arrangement between CSDs whereby one CSD becomes a

participant in the securities settlement system of another CSD in order to

facilitate the transfer of securities from the participants of the latter CSD to the

participants of the former CSD or accesses the other CSD indirectly via an

intermediary. CSD links include standard links, customised links, indirect links,

and interoperable links;

(29) 'standard 'link▌' means a CSD link whereby a CSD becomes a participant to the

securities settlement system of another CSD under the same terms and

conditions as applicable to any other participant to the securities settlement

system operated by the latter;

(30) 'customised 'link▌' means a CSD link whereby a CSD that becomes a

participant to the securities settlement system of another CSD is provided

additional specific services to ▌ the services normally provided by that CSD to

▌ participants to ▌securities settlement system;

(31) 'international open communication procedures and standards' means

internationally accepted standards for communication procedures, such as

standardised messaging formats and data representation, which are available

on a fair, open and non-discriminatory basis to any interested party;

(32) 'interoperable link' means a CSD link whereby the CSDs agree to establish

mutual technical solutions for settlement in the securities settlement systems

that they operate;

66

(33) 'Indirect link' means an arrangement between a CSD and a third party other

than a CSD, that is a participant to the securities settlement system of another

CSD. Such link is set up by a CSD in order to facilitate the transfer of

securities to its participants from the participants of another CSD;

(34) 'transferable securities' means transferable securities as defined in point (18) of

Article 4 of Directive 2004/39/EC;

(35) ‘shares’ means securities specified in point 18(a) of Article 4 of Directive

2004/39/EC [new Article 2(1)(9)(a) MiFIR];

(36) 'money-market instruments' means money-market instruments as defined in point

(19) of Article 4 of Directive 2004/39/EC;

(37) 'units in collective investment undertakings' means units in collective investment

undertakings as referred to in point (3) of Section C of Annex I of Directive

2004/39/EC;

(38) 'emission allowances' means any units recognised for compliance with the

requirements of Directive 2003/87/EC excluding derivatives in emission

allowances;

(39) 'regulated market' means 'regulated market' as defined in point (14) of Article 4

of Directive 2004/39/EC;

(40) 'multilateral trading facility’ (‘MTF’)▌ means multilateral trading facility as

defined in point (15) of Article 4 of Directive 2004/39/EC;

67

(41) 'organised trading facility' or 'OTF▌' means any system or facility, which is not

a regulated market or MTF, operated by an investment firm or a market operator,

in which multiple third-party buying and selling interests in financial instruments

are able to interact in the system in a way that results in a contract in accordance

with the provisions of Title II of Directive 2004/39/EC;

(42) 'trading venue' means a trading venue within the meaning of Article [2(1)(25)]

of Regulation (EU) No..../... [MiFIR].

(43) 'subsidiary' means a subsidiary undertaking within the meaning of Article 1 of

Directive 83/349/EEC;

(44) 'settlement agent' means settlement agent as defined in point (d) of Article 2 of

Directive 98/26/EC.

(45) 'SME growth market' means an MTF that is registered as an SME growth

market in accordance with Article 35 of Directive .../../EU [new MiFID].

(46) ‘management body’ means the body or bodies of a CSD, appointed in

accordance with the national law, which is empowered to set the CSDs

strategy, objectives and overall direction, and which oversees and monitors

management decision-making. This shall include persons who effectively

direct the business of the CSD.

Where, according to national law, management body comprises different

bodies with specific functions, the requirements of this Regulation shall apply

only to those members of the management body to whom the applicable

national law assigns the respective responsibility;

68

(47) 'senior management' means those natural persons who exercise executive

functions within a CSD and who are responsible and accountable to the

management body for the day-to-day management of that CSD.

2. The Commission shall be empowered to adopt delegated acts in accordance

with Article 68 concerning measures to further specify the ancillary services set

out in points (1) to (4) of Section B of the Annex and the services set out in ▌

Section C of the Annex.

69

Title II

Securities settlement

Chapter I

Book-entry form

Article 3

Book-entry form

1. Without prejudice to paragraph 2, any issuer established in the Union that issues or

has issued transferable securities which are admitted to trading or traded on trading

venues, shall arrange for such securities to be represented in book-entry form as

immobilisation ▌ or subsequent to a direct issuance in dematerialised form.

2. Where a transaction in transferable securities takes place on a trading venue the

relevant securities shall be recorded in book-entry form in a CSD on or before the

intended settlement date, unless they have already been so recorded.

Where transferable securities are transferred following a financial collateral

arrangement as defined in point (a) of Article 2 of Directive 2002/47/EC, those

securities shall be recorded in book-entry form in a CSD prior to the settlement date,

unless they have already been so recorded.

70

Article 4

Enforcement

1. The authorities of the Member State where the issuer that issues securities is

established shall be competent for ensuring that Article 3(1) is applied.

2. The authorities competent for the supervision of the trading venues, including the

competent authorities designated in accordance with Article 21(1) of Directive

2003/71/EC, shall ensure that Article 3(2) is applied when the securities referred to in

Article 3(1) are traded on trading venues.

3. Member States' authorities responsible for the application of Directive 2002/47/EC

shall be competent for ensuring that Article 3(2) of this Regulation is applied when the

securities referred to in Article 3(1) of this Regulation are transferred following a

financial collateral arrangement as defined in point (a) of Article 2 of Directive

2002/47/EC.

71

Chapter II

Settlement Periods

Article 5

Intended settlement dates

1. Any participant to a securities settlement system that settles in that system on its own

account or on behalf of a third party transactions in transferable securities, money-

market instruments, units in collective investment undertakings and emission

allowances shall settle such transactions on the intended settlement date.

2. As regards transactions in transferable securities referred to in paragraph 1 which are

executed on trading venues, the intended settlement date shall be no later than on the

second business day after the trading takes place. This requirement shall not apply to

transactions which are negotiated privately but executed on a trading venues, to

transactions which are executed bilaterally but reported to a trading venue or to the

first transaction where the transferable securities concerned are subject to initial

recording in book-entry form pursuant to Article 3(2).

3. The authorities competent for the supervision of the CSDs shall be competent for

ensuring that paragraph 1 is applied.

The authorities competent for the supervision of trading venues shall be competent

for ensuring that paragraph 2 is applied.

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Chapter III

Settlement discipline

Article 6

Measures to prevent settlement fails

1. Trading venues shall establish procedures that enable the confirmation of relevant

details of transactions in financial instruments referred to in Article 5 (1) on the date

when the transaction has been executed.

Notwithstanding the requirement set out in the first sub-paragraph, investment firms

authorised pursuant to Article 5 of Directive .../.../EU [new MiFID] shall, where

applicable, put in place arrangements to limit the number of settlement fails. Such

measures shall at least consist of arrangements between the investment firm and its

professional clients to ensure the prompt communication of an allocation of

securities to the transaction, confirmation of that allocation and confirmation of the

acceptance or rejection of terms in good time before the intended settlement date.

ESMA shall, in close co-operation with the members of ESCB, issue guidelines in

accordance with Article 16 of Regulation (EU) No 1095/2010 on the standardised

procedures and messaging protocols to be used referred to in the first sub-

paragraph.

2. For each securities settlement system it operates, a CSD shall establish procedures that

facilitate the settlements of transactions in financial instruments referred to in Article

5(1) on the intended settlement date with a minimum exposure of its participants to

counterparty and liquidity risks and a low rate of settlement fails. It shall promote

early settlement on the intended settlement date through appropriate mechanisms▌.

3. For each securities settlement system it operates, a CSD shall put in place measures

to encourage and incentivise the timely settlement of transactions by its participants.

CSDs shall require participants to settle their transactions on the intended settlement

date.

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4. The European Securities and Markets Authority (ESMA) shall develop, in close co-

operation with the members of the European System of Central Banks (ESCB), draft

regulatory technical standards to specify the measures to be taken by investment firms

in accordance with the first subparagraph of paragraph 1, the details of the

procedures ▌facilitating settlement referred to in paragraph 2 and the details of the

measures to encourage and incentivise the timely settlement of transactions referred

to in paragraph 3.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

Article 7

Measures to address settlement fails

1. For each securities settlement system it operates, a CSD shall establish a system that

monitors settlement fails of transactions in financial instruments referred to in Article

5(1). It shall provide regular reports to the competent authority and the authorities

referred to in Article 11, as to the number and details of settlement fails and any other

relevant information. These reports, including the measures envisaged by CSDs and

their participants to improve settlement efficiency, shall be made public by CSDs in

an aggregated and anonymised form on an annual basis. The competent authorities

shall share with ESMA any relevant information on settlement fails.

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2. For each securities settlement system it operates, a CSD shall establish procedures that

facilitate settlement of transactions in financial instruments referred to in Article 5(1)

that are not settled on the intended settlement date. These procedures shall provide for

a ▌penalty mechanism which will serve as an effective deterrent for participants that

cause the settlement fails.

Before establishing the procedures referred to in the previous subparagraph, a CSD

shall consult the relevant trading venues and CCPs in respect of which it provides

settlement services.

Such penalty mechanisms shall include cash penalties

for participants that cause settlement fails (‘failing participants’). Cash penalties

shall be calculated on a daily basis for each business day that a transaction fails to

settle after its intended settlement date until the end of a buy-in period referred to in

paragraph 3, but no longer than the actual settlement day.

The cash penalties referred to in the previous subparagraph shall not be configured

as a revenue source for the CSD.

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3. Without prejudice to the penalties as defined in paragraph 2 and the right to

bilaterally cancel the transaction, where a failing participant does not deliver the

financial instruments referred to in Article 5(1) to the receiving participant within 4

business days after the intended settlement date (‘extension period’) a buy-in process

shall be initiated whereby those instruments shall be available for settlement and

delivered to the receiving participant within an appropriate time frame. Where the

transaction relates to a financial instrument traded on an SME growth market the

extension period shall be 15 days unless the SME growth market decides to apply a

shorter period.

4. The following exemptions from the requirement referred to in paragraph 3 shall

apply:

a) Based on asset type and liquidity of the financial instruments concerned, the

extension period may be increased from 4 business days up to a maximum of 7

business days where a shorter extension period would affect the smooth and

orderly functioning of the financial markets concerned.

b) For operations composed of several transactions including securities

repurchase or lending agreements, the buy-in referred to in first sub-

paragraph shall not apply where the timeframe of these operations is

sufficiently short and renders the buy-in ineffective.

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5. Without prejudice to paragraph 4, the exemptions referred to in paragraph 3a0 shall

not apply in relation to transactions for shares where the shares are cleared by a

CCP.

This Article does not apply where the principal venue for the trading of shares is

located in a third country. The location of the principal venue for the trading of

shares is to be determined in accordance with Article 16 of Regulation 236/2012.”

6. Without prejudice to the penalties as defined in paragraph 2, where the price of the

shares agreed at the time of the trade is higher than the price paid for the execution

of the buy-in, the corresponding difference shall be paid to the receiving participant

by the failing participant no later than on the second business day after the financial

instruments have been delivered following the buy-in.]

7. If the buy-in fails or is not possible, the receiving participant can choose to be paid a

cash compensation or to defer the execution of the buy-in to an appropriate later

date (‘deferral period’).

If the financial instruments are not delivered to the receiving participant at the end

of the deferral period, the cash compensation shall be paid.

The cash compensation shall be paid to the receiving participant no later than on the

second business day after the end of the buy-in period or deferral period, where the

deferral period was chosen.

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8. The failing participant shall reimburse the entity that executes the buy-in of all

amounts paid ▌in accordance with paragraphs 3, 4 and 5, including any execution

fees resulting from the buy-in. Such fees shall be clearly disclosed to the

participants.

9. CSDs, CCPs, trading venues shall establish procedures that enable them to suspend in

consultation with their respective competent authority any participant that fails

consistently and systematically to deliver the financial instruments referred to in

Article 5(1) on the intended settlement date and to disclose to the public its identity

only after giving that participant the opportunity to submit its observations and

provided the competent authorities of the CSD, CCPs and trading venues, and of

that participant have been duly informed. In addition to consulting before any

suspension, CSDs, CCPs and trading venues, shall notify, with no delay, the

respective competent authority of the suspension of a participant. The competent

authority shall immediately inform the relevant authorities referred to in Article 12

on the suspension of the participant.

Public disclosure of suspensions shall not contain personal data within the meaning

of Article 2 (a) of Directive 95/46/EC.

10. Paragraphs 2 to 9 shall apply to all transactions of the instruments referred to in Article

5 (1) which are admitted to trading or traded on a trading venue or cleared by a CCP

as follows:

a) For transactions cleared by a CCP, the CCP shall be the entity that executes the

buy-in procedure according to paragraphs 3 to 4a.

b) For transactions not cleared by a CCP but executed on a trading venue, the

trading venue shall include in its internal rules an obligation for its members

and its participants to be subject to the measures referred to in paragraphs 3 to

8.

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c) For all other transactions than those referred to in points (a) and (b) the CSDs

shall include in their internal rules an obligation for its participants to be

subject to the measures referred to in paragraphs 3 to 8.

A CSD shall provide the necessary settlement information to CCPs and trading

venues to enable them to fulfil their obligations under this paragraph.

Without prejudice to points (a) to (c) of this sub-paragraph CSDs may monitor the

execution of buy-ins referred to in those points with respect to multiple settlement

instructions, on the same financial instruments and with the same date of expiry of

the execution period, with the aim of minimising the number of buy-ins to be

executed and thus the impact on the prices of the relevant financial instruments.

11. Paragraphs 2 to 9 shall not apply to failing participants which are CCPs.

12. Paragraphs 2 to 9 shall not apply if insolvency proceedings are opened against the

failing participant.

13. The Commission shall be empowered to adopt delegated acts in accordance with

Article 68 to specify parameters for the calculation of a deterrent and proportionate

level of cash penalties referred to in paragraph 2 based on asset type liquidity of the

instrument and type of transaction that shall ensure a high degree of settlement

discipline and a smooth and orderly functioning of the financial markets concerned.

14. ESMA shall▌, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify ;

a) the details of the system monitoring settlement fails and the reports on settlement

fails referred to in paragraph 1, ▌

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b) the processes for collection and redistribution of cash penalties and any other

possible proceeds from such penalties;

c) the details of operation of the appropriate buy-in mechanism, including

appropriate time frames to deliver the financial instrument following the buy-

in procedure referred to in paragraph 3. Such time frames shall be calibrated

taking into account the asset type and liquidity of the financial instruments.

d) the circumstances under which the extension period could be prolonged

according to asset type and liquidity of the financial instruments, in

accordance with the conditions referred to in point (a) of paragraph 4 taking

into account the criteria for assessing liquidity under Articles 2(1)(7a) of

MiFIR [MIFIR determination of ‘liquid market’];

e) type of operations and their specific timeframes referred to in point (c) of

paragraph 4 that renders buy-in ineffective;

f) A methodology for the calculation of the cash compensation referred to in

paragraph 7.

g) the conditions under which a participant is deemed to consistently and

systemically fail to deliver the financial instruments referred to in paragraph

9; and,

h) the necessary settlement information referred to in paragraph 10.

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ESMA shall submit those draft regulatory technical standards to the Commission by

[nine months from the date of entry into force of this Regulation].

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

Article 8

Enforcement

1. The competent authority of the CSD that operates the securities settlement system,

the relevant authority responsible for the oversight of the securities settlement system

concerned as well as the competent authorities for the supervision of trading venues

and CCPs shall be competent for ensuring that Articles 6 and 7 are applied by the

institutions subject to their supervision and for monitoring the penalties imposed .

Where necessary, the respective competent authorities shall cooperate closely.

Member States shall inform ESMA about the designated competent authorities that

are part of the supervision structure on the national level.

2. In order to ensure consistent, efficient and effective supervisory practices within the

Union in relation to Articles 6 and 7 of this Regulation, ESMA may, in close co-

operation with the members of ESCB, issue guidelines in accordance with Article 16

of Regulation (EU) No 1095/2010.

3. An infringement of the rules under this Title shall not affect the validity of a private

contract on financial instruments or the possibility for the parties to enforce the

provisions of a private contract on financial instruments.

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Chapter IV

Internalised settlement

Article 9

Settlement internalisers

1. Settlement internalisers shall report to the competent authorities the aggregated

volume and value of all securities transactions that they settle outside securities

settlement systems on a quarterly basis.

Competent authorities shall without delay transmit the information received under

the first subparagraph to ESMA and shall inform ESMA of any potential risk

resulting from that settlement activity.

2. ESMA may, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards further specifying the content of such reporting.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

3. ESMA shall develop draft implementing technical standards to establish standard

forms, templates and procedures for the reporting and transmission of information

referred to in paragraph 1.

ESMA shall submit those draft implementing technical standards to the Commission

by [nine months from the entry into force of this Regulation].

Power is conferred on the Commission to adopt the implementing technical

standards referred to in the first subparagraph in accordance with Article 15 of

Regulation (EU) No 1095/2010.

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Title III

Central securities depositories

Chapter I

Authorisation and supervision of CSDs

Section 1

Authorities responsible for authorisation and supervision of CSDs

Article 10

Competent authority

Without prejudice to the oversight by the members of the ESCB referred to in Article 12(1) a

CSD shall be authorised and supervised by the competent authority of the Member State where

it is established.

Article 11

Designation of the competent authority

1. Each Member State shall designate the competent authority responsible for carrying

out the duties under this Regulation for the authorisation and supervision of CSDs

established in its territory and shall inform ESMA thereof.

Where a Member State designates more than one competent authority, it shall

determine their respective roles and shall designate a single authority to be responsible

for cooperation with other Member States' competent authorities, the relevant

authorities referred to in Article 12, ESMA, and EBA whenever specifically referred to

in this Regulation.

2. ESMA shall publish on its website a list of the competent authorities designated in

accordance with paragraph 1.

3. The competent authorities shall have the supervisory and investigatory powers

necessary for the exercise of their functions.

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Article 12

Relevant authorities

1. The following authorities shall be involved in the authorisation and supervision of

CSDs whenever specifically referred to in this Regulation:

(a) the authority responsible for the oversight of the securities settlement system

operated by the CSD in the Member State whose law applies to that securities

settlement system;

b) the central banks in the Union issuing the most relevant currencies in which

settlement takes place;

(c) where relevant, the central bank in the Union in whose books the cash leg of a

securities settlement system operated by the CSD is settled▌.

2. ESMA shall publish on its website the list of the relevant authorities referred to in

paragraph 1.

3. ESMA shall, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards specifying the conditions under which the Union

currencies referred to in point (b) of paragraph 1 are considered to be as the most

relevant and efficient practical arrangements for the consultation of the relevant

authorities referred to in point (b) and (c).

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

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Article 13

Exchange of Information

1. Competent authorities, other relevant authorities and ESMA shall, on request and

without undue delay, provide one another with the information required for the

purposes of carrying out their duties under this Regulation.

2. Competent authorities, other relevant authorities, ESMA and other bodies or natural

and legal persons receiving confidential information in the exercise of their duties

under this Regulation shall use it only in the course of their duties.

Article 14

Cooperation between authorities

1. The authorities referred to in Articles 10 and 12 and ESMA shall cooperate closely,

including by exchanging all relevant information for the application of this

Regulation▌. Whenever appropriate and relevant, such cooperation shall include other

public authorities and bodies, in particular those established or appointed under

Directive 2003/87/EC.

In order to ensure consistent, efficient and effective supervisory practices within the

Union, including cooperation between authorities referred to in Articles 10 and 12 in

the different assessments necessary for the application of this Regulation, ESMA may,

in close cooperation with the members of the ESCB, issue guidelines addressed to

authorities referred to in Article109 in accordance with Article 16 of Regulation (EU)

No 1095/2010.

2. The competent authorities shall, in the exercise of their general duties, duly consider

the potential impact of their decisions on the stability of the financial system in all

other Member States concerned, in particular in the emergency situations referred to in

Article 15, based on the available information.

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Article 15

Emergency situations

Without prejudice to the notification procedure provided for in Article 6(3) of Directive

98/26/EC, the authorities referred to in Articles 10 and 12 shall immediately inform ESMA, the

ESRB and each other of any emergency situation relating to a CSD, including of any

developments in financial markets, which may have an adverse effect on market liquidity, the

stability of a currency in which settlement takes place, the integrity of monetary policy and on

the stability of the financial system in any of the Member States where the CSD or one of its

participants are established.

Section 2

Conditions and procedures for authorisation of CSDs

Article 16

Authorisation of a CSD

1. Any legal person that falls within the definition of CSD shall obtain an authorisation

from the competent authority of the Member State where it is established before

commencing its activities.

2. The authorisation shall specify the core services ▌ in Section A of the Annex and

ancillary services permitted pursuant to section B of the Annex, which the CSD is

authorised to provide.

3. A CSD shall comply at all times with the conditions necessary for the authorisation.

A CSD as well as its independent auditors, shall, without undue delay, inform the competent

authority of any material changes affecting the conditions for authorisation.

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Article 17

Procedure for granting authorisation

1. The applicant CSD shall submit an application for authorisation to its competent

authority.

2. The application for authorisation shall be accompanied by all information necessary to

enable the competent authority to satisfy itself that the applicant CSD has established,

at the time of the authorisation, all the necessary arrangements to meet its obligations

set out in this Regulation. The application for authorisation shall include a programme

of operations setting out the types of business envisaged and the structural organisation

of the CSD.

3. Within 30 working days from the receipt of the application, the competent authority

shall assess whether the application is complete. If the application is not complete, the

competent authority shall set a time limit by which the applicant CSD has to provide

additional information. The competent authority shall inform the applicant CSD when

the application is considered to be complete.

4. As from the moment when the application is considered to be complete, the competent

authority shall transmit all information included in the application to the relevant

authorities referred to in Article 12 and consult those authorities concerning the

features of the securities settlement system operated by the applicant CSD. Each

relevant authority may inform the competent authority of its views within 3 months

of the receipt of the information by the relevant authority.

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5. Whenever the applicant CSD intends to provide services referred to in point 1 of

Article 4(2) of Directive [MiFID proposal] in addition to the provision of ancillary

services explicitly listed in Section B of the Annex, the competent authority shall

transmit all information included in the application to the authority referred to in

Article 69 of Directive [MiFID proposal] and consult that authority on the ability of

the applicant CSD to comply with the requirements of Directive [MiFID proposal]

and of Regulation [MiFIR].

6. The competent authority shall, before granting authorisation to the applicant CSD,

consult the competent authorities of the other Member State involved in the following

cases:

(a) the CSD is a subsidiary of a CSD authorised in another Member State;

(b) the CSD is a subsidiary of the parent undertaking of a CSD authorised in another

Member State;

(c) the CSD is controlled by the same natural or legal persons who control a

different CSD authorised in another Member State.

The consultation referred to in the first subparagraph shall cover the following:

(a) the suitability of the shareholders and persons referred to in Article 27(6) and the

reputation and experience of the persons who effectively direct the business of

the CSD referred to in Article 27(1) and 27(4), whenever those shareholders▌

and persons are common to both the CSD and a CSD authorised in another

Member State;

(b) whether the relations referred to in paragraph 6 between the CSD authorised in

another Member State and the applicant CSD do not affect the ability of the

latter to comply with the requirements of this Regulation.

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7. Within six months from the submission of a complete application, the competent

authority shall inform the applicant CSD in writing with a fully reasoned decision

whether the authorisation has been granted or refused.

8. ESMA shall ▌, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the information that the applicant CSD shall

provide to the competent authority in the application for authorisation.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

9. ESMA shall ▌, in close cooperation with the members of the ESCB, develop draft

implementing technical standards to establish standard forms, templates and

procedures for the application for authorisation.

ESMA shall submit those draft implementing technical standards to the Commission

by nine months from the date of entry into force of this Regulation.

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

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Article 18

Effects of the authorisation

1. The activities of the authorised CSD shall be limited to the provision of services

covered by its authorisation or notified in accordance with Article 19(8).

2. Securities settlement systems may be operated only by authorised CSDs including

central banks acting as CSDs.

▌

4. An authorised CSD may only have a participation in a legal person whose activities are

limited to the provision of services set out in Sections A and B of the Annex, unless

such a participation is approved by its competent authority on the basis that it does

not significantly increase the risk profile of the CSD.

5. ESMA shall, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the criteria to be taken into account by the

competent authorities to approve participations of CSDs in legal persons other than

those providing the services listed in Sections A and B of the Annex. These criteria

may include whether the services provided by that legal person are complementary

to the services provided by a CSD, and the extent of the CSD’s exposure to liabilities

arising from that participation.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

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Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

Article 19

Extension and outsourcing of activities and services

1. An authorised CSD shall submit a request for authorisation to the competent authority

of the Member State where it is established whenever it wishes to outsource a core

service to a third party under Article 28 or extend its activities to one or more of the

following:

(a) additional core services set out in Section A of the Annex and ancillary services

permitted under, but not explicitly listed in Section B of the Annex not covered

by the initial authorisation▌

(b) the operation of another securities settlement system;

(c) the settlement of all or part the cash leg of its securities settlement system in the

books of another settlement agent;

(d) setting up an interoperable link, including those with third country CSDs.

2. The granting of authorisation under paragraph 1 shall follow the procedure set out in

Article 15.

The competent authority shall inform the applicant CSD whether the authorisation has

been granted or refused within three months of the submission of a complete

application.

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3. CSDs established in the Union that intend to establish an interoperable link shall

submit an application for authorisation as required under point (d) of paragraph 1,

to their respective competent authorities. These authorities shall consult with each

other regarding the approval of the CSD link. In case of divergent decisions and if

agreed by both competent authorities the matter may be referred to ESMA which

may act in accordance with the powers conferred on it under Article 19 of

Regulation (EU) No 1095/2010.

4. The authorities referred to in paragraph 3 shall refuse to authorise a link only when

such CSD link would threaten the smooth and orderly functioning of the financial

markets or cause systemic risk

5. Interoperable links of CSDs that outsource some of their services, related to these

interoperable links, to a public entity in accordance with Article 30(5) and CSD links

that are not referred to in point (d) of paragraph 1 shall not be subject to

authorisation under point (d) of paragraph 1, but shall be notified to the CSDs’

competent and relevant authorities prior to their implementation by providing all

relevant information that allows such authorities to assess compliance with the

requirements provided in Article 48.

6. A CSD established and authorised in the Union may maintain or establish a link

with a third country CSDs in accordance with the conditions and procedures

provided in this Article. Where the links are established with third country CSDs the

information provided by the requesting CSD shall allow the competent authority to

evaluate whether such links fulfil the requirements provided in Article 48 or the

requirements that are equivalent to those provided in Article 48.

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7. The competent authority of the requesting CSD shall require the CSD to discontinue

a CSD link that has been notified when such link does not fulfil the requirements

provided in Article 48 and thereby would threaten the smooth and orderly

functioning of the financial markets or cause systemic risk. A competent authority

requiring the CSD to discontinue a CSD link shall follow the relevant procedure

provided in Article 20.

8. The additional ancillary services explicitly listed in Section B of the Annex shall not

be subject to authorisation, but shall be notified to the competent authority prior to

their provision.

Article 20

Withdrawal of authorisation

1. Without prejudice to any remedial actions or measures under Title V, the competent

authority of the Member State where the CSD is established shall withdraw the

authorisation in any of the following circumstances:

(a) where the CSD has not made use of the authorisation during 12 months,

expressly renounces the authorisation or has provided no services or performed

no activity during the preceding six months;

(b) where the CSD has obtained the authorisation by making false statements or by

any other unlawful means;

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(c) where the CSD no longer complies with the conditions under which

authorisation was granted and has not taken the remedial actions requested by

the competent authority within a set time frame;

(d) where the CSD has seriously or systematically infringed the requirements set out

in this Regulation or, where applicable, in Directive xxxx/xxxx/EU [new

MiFID] or Regulation EU No. [MiFIR proposal].]

A CSD shall establish, implement and maintain an adequate procedure ensuring the

timely and orderly settlement and transfer of the assets of clients and participants to

another CSD in the event of a withdrawal of authorisation referred to in the first

subparagraph.

2. As from the moment it becomes aware of one of the circumstances referred to in

paragraph 1, the competent authority shall immediately consult the relevant authorities

referred to in Article 11 and, where applicable , the authority referred to in Article 69

of Directive xxxx/xxxx/EU [new MiFID] on the necessity to withdraw the

authorisation ▌.

3. ESMA and any relevant authority referred to in Article 12 and, where applicable, the

authority referred to in Article 69 of Directive xxxx/xxxx/EU [new MiFID] may, at

any time, request that the competent authority of the Member State where the CSD is

established examines whether the CSD still complies with the conditions under which

the authorisation was granted.

4. The competent authority may limit the withdrawal to a particular service, activity, or

financial instrument.

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Article 21

CSD Register

1. Decisions taken by competent authorities under Articles 16, 19 and 20 shall be

immediately communicated to ESMA.

2. Central banks shall without undue delay inform ESMA of any securities settlement

system that they operate.

3. The name of each CSD operating in compliance with this Regulation and to which

authorisation or recognition has been granted under Articles 16, 19 and 25 shall be

entered in a list specifying the services and, where applicable, classes of financial

instruments for which the CSD has been authorised. The list shall include branches

operated by the CSD in other Member States, CSD links and the information required

under Article 31 where Member States have made use of the possibility provided for

in that Article. ESMA shall publish the list on its dedicated website and keep it up to

date.

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SECTION 3

SUPERVISION OF CSDS

Article 22

Review and evaluation

1. The competent authority shall, at least on an annual basis, review the arrangements,

strategies, processes and mechanisms implemented by a CSD with respect to

compliance with this Regulation and evaluate the risks to which the CSD is, or might

be, exposed or which it creates for the smooth functioning of securities markets.

2. Competent authorities shall require the CSD to submit to the competent authorities

an adequate recovery plan to ensure continuity of its critical operations.

3. Competent authorities shall ensure that an adequate resolution plan is established

and maintained for each CSD so as to ensure continuity of at least its core functions,

having regard to the size, systemic importance, nature, scale and complexity of the

activities of the CSD concerned and any relevant resolution plan established in

accordance with Directive xxxx/xxxx/EU [BRRD].

4. The competent authority shall establish the frequency and depth of the review and

evaluation referred to in paragraph 1 having regard to the size, systemic importance,

nature, scale and complexity of the activities of the CSD concerned. The review and

evaluation shall be updated at least on an annual basis.

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5. The competent authority shall subject the CSD to on-site inspections.

6. When performing the review and evaluation referred to in paragraph 1, the competent

authority shall consult at an early stage the relevant authorities referred to in Article

12, in particular concerning the functioning of the securities settlement systems

operated by the CSD and, where applicable, the authority referred to in Article 69 of

Directive xxxx/xxxx/EU [new MiFID].

7. The competent authority shall regularly, and at least once a year, inform the relevant

authorities referred to in Article 12 and, where applicable, the authority referred to in

Article 69 of Directive xxxx/xxxx/EU [new MiFID] of the results, including any

remedial actions or penalties, of the review and evaluation referred to in paragraph 1.

8. When performing the review and evaluation referred to in paragraph 1, the competent

authorities responsible for supervising CSDs which maintain the types of relations

referred to in points (a), (b) and (c) of the first subparagraph of Article 17(6) shall

supply one another with all relevant information that is likely to facilitate their tasks.

9. The competent authority shall require the CSD that does not meet the requirements of

this Regulation to take at an early stage the necessary actions or steps to address the

situation.

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10. ESMA shall ▌, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the following:

(a) the information that the CSD shall provide to the competent authority for the

purposes of the review referred to in paragraph 1;

(b) the information that the competent authority shall supply to the relevant

authorities referred to in paragraph 7;

(c) the information that the competent authorities referred to in paragraph 8 shall

supply one another.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

11. ESMA shall ▌, in close cooperation with the members of the ESCB, develop draft

implementing technical standards to determine standard forms, templates and

procedures for the provision of information referred to in the first subparagraph of

paragraph 10.

ESMA shall submit those draft implementing technical standards to the Commission

by nine months from the date of entry into force of this Regulation.

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

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SECTION 4

PROVISION OF SERVICES IN ANOTHER MEMBER STATE

Article 23

Freedom to provide services in another Member State

1. An authorised CSD may provide services referred to in the Annex within the territory

of the Union, including through the establishment of a branch▌, provided that those

services are covered by the authorisation.

2. An authorised CSD that intends to provide the services referred to in points 1 and 2

of Section A of the Annex in relation to financial instruments constituted under the

law of another Member State referred to in Article 49(1) or to establish a branch in

another Member State shall be subject to the procedure referred to in paragraphs 3

to 7.

3. Any CSD wishing to provide the services referred to in paragraph 2 within the

territory of another Member State for the first time, or to change the range of those

services provided shall communicate the following information to the competent

authority of the home Member State ▌ :

(a) the Member State in which the CSD intends to operate;

(b) a programme of operations stating in particular the services which the CSD

intends to provide;

(c) the currency or currencies it intends to process;

(d) where there is a branch, the organisational structure of the branch and the names

of those responsible for the management of the branch.

(e) whenever relevant, an assessment of the measures the CSD intends take to

allow its users' to comply with national laws referred to in Article 49(1).

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4. Within three months from the receipt of the information referred to in paragraph 3, the

competent authority of the home Member State shall communicate that information to

the competent authority of the host Member State unless, by taking into account the

provision of services envisaged, it has reasons to doubt the adequacy of the

administrative structure or the financial situation of the CSD wishing to provide its

services in the host Member State.

The competent authority of the host Member State shall inform without delay the

relevant authorities referred to in Article 12 of that Member State of any

communication received under the first subparagraph.

5. Where the competent authority of the home Member State decides in accordance with

paragraph 4 not to communicate all information referred to in paragraph 3 to the

competent authority of the host Member State▌ it shall give reasons for its refusal to

the CSD concerned within three months of receiving all the information and inform

the competent authority of the host Member State of its decision in relation to point

(a) of paragraph 6. Where information is shared in response to such a request the

host Member State competent authority shall not issue the communication referred

to in paragraph 6(a).

6. The CSD may start providing the services referred to in paragraph 2 in the host

Member State under the following conditions:

(a) on receipt of a communication from the competent authority in the host Member

State acknowledging receipt by the latter of the communication referred to in

paragraph 4 and, whenever relevant, approving the assessment referred to in

point (e) of paragraph 3;

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(b) in the absence of any receipt of a communication, after three months from the

date of transmission of the communication referred to in paragraph 4.

7. In the event of a change in any of the information communicated in accordance with

paragraph 3, a CSD shall give written notice of that change to the competent authority

of the home Member State at least one month before implementing the change. The

competent authority of the host Member State shall also be informed of that change

without delay by the competent authority of the home Member State.

Article 24

Cooperation between home and host Member States´ authorities and peer review

1. Where a CSD authorised in one Member State has established a branch in another

Member State, the competent authority of the home Member State and the competent

authority of the host Member State shall cooperate closely in the performance of the

duties provided for in this Regulation, in particular when carrying out on-site

inspections in that branch. The competent authority of the home and host Member

States may, in the exercise of their responsibilities, carry out on-site inspections in

that branch after informing the competent authority of the home or host Member

State respectively .

2. The competent authorities from the home or host Member States may require CSDs

which provide services in accordance with Article 23 to report to them periodically on

their activities in those host Member States, including for the purpose of collecting

statistics. The competent authorities of the host Member State shall, on request from

the competent authorities of the home Member State, provide those periodic reports

to the home Member State competent authorities.

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3. The competent authority of the home Member State of the CSD shall, on the request of

the competent authority of the host Member State and without delay, communicate the

identity of the issuers and participants to the securities settlement systems operated by

the CSD which provides services in that host Member State and any other relevant

information concerning the activities of that CSD in the host Member State.

4. When, taking into account the situation of the securities markets in the host Member

State, the activities of a CSD that has established a branch ▌ have become of

substantial importance for the functioning of the securities markets and the protection

of the investors in that host Member State, the home and host competent and relevant

authorities shall establish cooperation arrangements for the supervision of the activities

of that CSD in the host Member State.

Where a CSD has become of substantial importance for the functioning of the

securities markets and the protection of the investors in more than one host Member

State, the home Member State may decide that such cooperation arrangements

include colleges of supervisors.

5. Where the competent authority of the host Member State has clear and demonstrable

grounds for believing that a CSD providing services within its territory in accordance

with Article 23 is in breach of the obligations arising from the provisions of this

Regulation, it shall refer those findings to the competent authority of the home

Member State and ESMA.

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Where, despite measures taken by the competent authority of the home Member State

or because such measures prove inadequate, the CSD persists in acting in breach of the

obligations arising from the provisions of this Regulation, after informing the

competent authority of the home Member State, the competent authority of the host

Member State shall take all the appropriate measures needed in order to ensure

compliance with the provisions of this Regulation within the territory of the host

Member State. ESMA shall be informed of such measures without delay.

The competent authorities of the host and home Member States may refer the matter

to ESMA, which may act in accordance with the powers conferred on it under Article

19 of Regulation (EU) No 1095/2010.

6. Without prejudice to Article 30 of Regulation (EU) No. 1095/2010, ESMA shall,

after consulting the members of the ESCB, conduct at least once every three years a

peer review of the supervision of CSDs which make use of the freedom to provide

services in more than one Member State in accordance with Article 23 or participate

in an interoperable link.

In the context of the peer review referred to in the previous sub-paragraph the

Authority shall, where appropriate, also request opinions or advice from the

Securities and Markets Stakeholder Group referred to in Article 37 of Regulation

(EU) No 1095/2010.

7. The Commission shall be empowered to adopt delegated acts in accordance with

Article 68 concerning measures for establishing the criteria under which the operations

of a CSD in a host Member State could be considered of substantial importance for the

functioning of the securities markets and the protection of the investors in that host

Member State.

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ESMA shall submit those draft regulatory technical standards to the Commission by

[nine months from the date of entry into force of this Regulation].

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

ESMA, in close cooperation with the members of the ESCB, shall develop draft

implementing technical standards to establish standard forms, templates and

procedures for the cooperation referred to in paragraphs 1, 3 and 5.

ESMA shall submit those draft implementing technical standards to the Commission

by nine months from the date of entry into force of this Regulation.

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

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SECTION 5

RELATIONS WITH THIRD COUNTRIES

Article 25

Third countries

1. A▌ third country CSD may provide services referred to in the Annex within the

territory of the Union including through the establishment of a branch .

2. Without prejudice to paragraph 1, a third country CSD that intends to provide the

services referred to in points 1 and 2 of Section A of the Annex in relation to

financial instruments constituted under the law of a Member State referred to in

Article 49(1) or to establish a branch in a Member State shall be subject to the

procedure referred to in paragraphs 4 to 12.

3. A CSD established and authorised in the Union may maintain or establish a link

with a CSD in a third country in accordance with the procedures in Article 48.

4. After consultation with the authorities referred to in paragraph 5, ESMA may

recognise a ▌third country CSD that has applied for recognition to provide the services

referred to in paragraph 2, where the following conditions are met:

(a) the Commission has adopted a decision in accordance with paragraph 9;

(b) the third country CSD is subject to effective authorisation▌, supervision and

oversight or, if the securities settlement system is operated by a central bank,

oversight, ensuring ▌full compliance with the prudential requirements applicable

in that third country;

(c) co-operation arrangements between ESMA and the responsible authorities in

that third country have been established pursuant to paragraph 10.

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(d) whenever relevant, the third country CSD takes the necessary measures to

allow its users to comply with the relevant national laws of the Member State

in which the third country CSD intends to provide CSD services, including the

laws referred to in paragraph 1, and the adequacy of those measures has been

confirmed by the competent authorities of the Member State in which the third

country CSD intends to provide CSD services.

5. When assessing whether the conditions referred to in paragraph 4 are met, ESMA shall

consult with:

(a) the competent authorities of the Member States in which the third country CSD

intends to provide CSD services▌, in particular, on how the▌ third country CSD

intends to comply with the requirement referred to in point (d) of paragraph 4;

(b) the authorities referred to in ▌ Article 12▌;

(c) the authorities in the third country responsible for authorising ▌, supervising

and overseeing CSDs.

6. The third country CSD referred to in paragraph 1 shall submit its application for

recognition to ESMA.

The applicant CSD shall provide ESMA with all information deemed necessary for its

recognition. Within 30 working days from the receipt of the application, ESMA shall

assess whether the application is complete. If the application is not complete, ESMA

shall set a time limit by which the applicant CSD has to provide additional

information.

The competent authorities of the Member States in which the third country CSD

intends to provide CSD services shall assess the compliance of the third country

CSD with the laws referred to in point (d) of paragraph 4 and inform ESMA with a

fully reasoned decision whether the compliance is met or not within three months

from the receipt of all the necessary information from ESMA.

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The recognition decision shall be based on the criteria set out in paragraph 4.

Within six months from the submission of a complete application, ESMA shall inform

the applicant CSD in writing with a fully reasoned decision whether the recognition

has been granted or refused.

7. The competent authorities of the Member States - in which the third country CSD,

duly recognised under paragraph 4, provides CSD services - in close cooperation

with ESMA, may request the responsible authorities of that third country CSD to:

(a) report periodically on the third country CSD activities in those host Member

States, including for the purpose of collecting statistics;

(b) communicate, within an appropriate time frame, the identity of the issuers and

participants to the securities settlement systems operated by the third country

CSD which provides services in that host Member State and any other relevant

information concerning the activities of that third country CSD in the host

Member State.

8. ESMA shall, in consultation with the authorities referred to in paragraph 5, review the

recognition of the ▌ third country CSD in case of extensions by that CSD in the Union

of its services ▌ under the procedure set out in paragraphs 4 to 6.

ESMA shall withdraw the recognition of that CSD where the conditions and

requirements according to paragraph 4 are no longer met or in the circumstances

referred to in Article 20.

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9. The Commission may adopt a decision in accordance with the procedure referred to in

Article 70, determining that the legal and supervisory arrangements of a third country

ensure that CSDs authorised in that third country comply with legally binding

requirements which are in effect equivalent to the requirements set out in this

Regulation, that those CSDs are subject to effective supervision, oversight and

enforcement in that third country on an ongoing basis and that the legal framework of

that third country provides for an effective equivalent system for the recognition of

CSDs authorised under third country legal regimes.

In addition, the Commission may consider whether these legal and supervisory

arrangements also reflect the internationally agreed CPSS-IOSCO standards, in so

far as the latter do not conflict with the requirements set out in this Regulation.

10. In accordance with Article 33 (1) of Regulation (EU) No 1095/2010, ESMA shall

establish cooperation arrangements with the responsible authorities of third countries

whose legal and supervisory frameworks have been recognised as equivalent to this

Regulation in accordance with paragraph 9. Such arrangements shall specify at least:

(a) the mechanism for the exchange of information between ESMA▌, the host

competent authorities and the responsible authorities of third countries

concerned, including access to all information regarding the CSDs authorised in

third countries that is requested by ESMA and in particular access to

information in cases referred to in paragraphs 7;

(b) the mechanism for prompt notification of ESMA where a responsible third

country ▌ authority deems a CSD it is supervising to be in breach of the

conditions of its authorisation or other applicable law;

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(c) the procedures concerning the coordination of supervisory activities including,

where appropriate, onsite inspections.

Where a cooperation agreement provides for transfers of personal data by a Member

State, such transfers shall comply with the provisions of Directive 95/46/EC and where

a cooperation agreement provides for transfers of personal data by ESMA, such

transfers shall comply with the provisions of Regulation (EU) No 45/2001.

11. Where a third country CSD has been recognised, in accordance with paragraphs 4-

8, it may provide services referred to in the Annex within the territory of the Union

including through the establishment of a branch.

12. ESMA shall, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the information that the applicant CSD shall

provide ESMA in its application for recognition under paragraph 6.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

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Chapter II

Requirements for CSDs

Section 1

ORGANISATIONAL REQUIREMENTS

Article 26

General provisions

1. A CSD shall have robust governance arrangements, which include a clear

organisational structure with well-defined, transparent and consistent lines of

responsibility, effective processes to identify, manage, monitor and report the risks to

which it is or might be exposed, and adequate remuneration policies and internal

control mechanisms, including sound administrative and accounting procedures.

2. A CSD shall adopt policies and procedures which are sufficiently effective so as to

ensure compliance with this Regulation, including compliance of its managers and

employees with all the provisions of this Regulation.

3. A CSD shall maintain and operate effective written organisational and administrative

arrangements to identify and manage any potential conflicts of interest between itself,

including its managers, employees, ▌ members of the management body or any

person directly or indirectly linked to them, and its participants or their clients. It shall

maintain and implement adequate resolution procedures whenever possible conflicts of

interest occur.

4. A CSD shall make its governance arrangements and the rules governing its activity

available to the public.

5. A CSD shall have appropriate procedures for its employees to report potential

violations internally through a specific channel.

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6. A CSD shall be subject to regular and independent audits. The results of these audits

shall be communicated to the management body and made available to the competent

authority and, where appropriate taking into account potential conflicts of interest

between the members of the user committee and the CSD, to the user committee.

7. Where a CSD is part of a group of undertakings including other CSDs or credit

institutions referred to in Title IV, it shall adopt detailed policies and procedures

specifying how the requirements set in this article apply to the group and to the

different entities of the group.

8. ESMA shall ▌, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards specifying the monitoring tools for the risks of the CSDs

referred to in paragraph 1, and the responsibilities of the key personnel in respect of

those risks, the potential conflicts of interest referred to in paragraph 3 and the audit

methods referred to in paragraph 6 at the CSD level as well as at the group level and

the circumstances in which it would be appropriate, taking into account potential

conflicts of interest between the members of the user committee and the CSD, to

share audit findings with the user committee in accordance with paragraph 6.ESMA

shall submit those draft regulatory technical standards to the Commission by nine

months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

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Article 27

Senior management, management body and shareholders

1. The senior management of a CSD shall be of sufficiently good repute and experience

so as to ensure the sound and prudent management of the CSD.

2. A CSD shall have a management body of which at least one third, but no less than

two, of its members are independent.

3. The compensation of the independent and other non-executive members of the

management body shall not be linked to the business performance of the CSD.

4. The management body shall be composed of suitable members of sufficiently good

repute with an appropriate mix of skills, experience and knowledge of the entity and of

the market. The non-executive members of the management body shall decide on a

target for the representation of the underrepresented gender in the management

body and prepare a policy on how to increase the number of the underrepresented

gender in order to meet that target. The target, policy and its implementation shall be

made public.

5. A CSD shall clearly determine the roles and responsibilities of the management body

in accordance with the relevant national law. A CSD shall make the minutes of the

▌meetings of the management body available to the competent authority and the

auditor upon request.

6. The CSD shareholders and persons who are in a position to exercise, directly or

indirectly, control over the management of the CSD shall be suitable to ensure the

sound and prudent management of the CSD.

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7. A CSD shall:

(a) provide the competent authority with, and make public, information regarding

the ownership of the CSD, and in particular, the identity and scale of interests of

any parties in a position to exercise control over the operation of the CSD;

(b) inform and seek approval from its competent authority of ▌any decision to

transfer of ownership rights which gives rise to a change in the identity of the

persons exercising control over the operation of the CSD. After receiving

approval by its competent authority, the CSD shall make public such transfer

of ownership rights.

Any natural or legal person shall inform without undue delay the CSD and its

competent authority of a decision to acquire or dispose of its ownership rights that

give rise to a change in the identity of the persons exercising control over the

operation of the CSD.

8. Within 60 working days from the receipt of the information referred to in paragraph 7,

the competent authority shall take a decision on the proposed changes in the control of

the CSD. The competent authority shall refuse to approve proposed changes in the

control of the CSD where there are objective and demonstrable grounds for believing

that they would pose a threat to the sound and prudent management of the CSD or to

the ability of the CSD to comply with this Regulation.

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Article 28

User committee

1. A CSD shall establish user committees for each securities settlement system it

operates, which shall be composed of representatives of issuers and of participants to

such securities settlement systems. The advice of the user committee shall be

independent from any direct influence by the management of the CSD.

2. A CSD shall define in a non-discriminatory way the mandate for each established user

committee, the governance arrangements necessary to ensure its independence and its

operational procedures, as well as the admission criteria and the election mechanism

for user committee members. The governance arrangements shall be publicly available

and shall ensure that the user committee reports directly to the management body and

holds regular meetings.

3. User committees shall advise the management body of the CSD on key arrangements

that impact their members, including the criteria for accepting issuers or participants to

their respective securities settlement systems and service level ▌.

4. User committees may submit a non-binding opinion to the management body

containing detailed reasons regarding the pricing structures of the CSD.

5. Without prejudice to the right of competent authorities to be duly informed, the

members of the user committees shall be bound by confidentiality. Where the

chairman of a user committee determines that a member has an actual or a potential

conflict of interest on a particular matter, that member shall not be allowed to vote on

that matter.

6. A CSD shall promptly inform the competent authority and the user committee of any

decision in which the management body decides not to follow the advice of the user

committee. The user committee may inform the competent authority of any areas in

which it considers the advice of the user committee has not been followed.

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Article 29

Record keeping

1. A CSD shall maintain, for a period of at least ten years, all the records on the services

and activity provided, including on the ancillary services referred to in Sections B

and C of the Annex, so as to enable the competent authority to monitor the compliance

with the requirements under this Regulation.

2. A CSD shall make the records referred to in paragraph 1 available upon request to the

competent authority and the relevant authorities referred to in Article 12 and any other

public authority which under Union or national law of the Member State where the

CSD is established has a power to require access to related records for the purpose of

fulfilling their mandates.

3. ESMA shall▌, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the details of the records referred to in

paragraph 1 to be retained for the purpose of monitoring the compliance of CSDs with

the provisions of this Regulation.

ESMA shall submit those drafts to the Commission by nine months from the date of

entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

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4. ESMA shall▌, in close cooperation with the members of the ESCB, develop draft

implementing technical standards to establish the format of the records referred to in

paragraph 1 to be retained for the purpose of monitoring the compliance of CSDs with

the provisions of this Regulation.

ESMA shall submit those draft implementing technical standards to the Commission

by nine months from the date of entry into force of this Regulation.

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

Article 30

Outsourcing

1. Where a CSD outsources services or activities to a third party, it shall remain fully

responsible for discharging all of its obligations under this Regulation and shall

comply at all times with the following conditions:

(a) outsourcing does not result in the delegation of its responsibility;

(b) the relationship and obligations of the CSD towards its participants or issuers are

not altered;

(c) the conditions for the authorisation of the CSD do not effectively change;

(d) outsourcing does not prevent the exercise of supervisory and oversight functions,

including on site access to acquire any relevant information needed to fulfil

those functions;

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(e) outsourcing does not result in depriving the CSD from the necessary systems and

controls to manage the risks it faces;

(f) the CSD retains the necessary expertise and resources for evaluating the quality

of the services provided, the organisational and capital adequacy of the service

provider, for supervising the outsourced services effectively and for managing

the risks associated with the outsourcing on an ongoing basis;

(g) the CSD has direct access to the relevant information of the outsourced services;

(h) the service provider cooperates with the competent authority and the relevant

authorities referred to in Article 12 in connection with the outsourced activities;

(i) the CSD ensures that the service provider meets the standards set down by the

relevant data protection law which would apply if the service providers were

established in the Union. The CSD is responsible for ensuring that those

standards are set out in a contract between the parties and that those standards are

maintained.

2. The CSD shall define in a written agreement its rights and obligations and those of the

service provider. The outsourcing agreement shall include the possibility of the CSD to

terminate the agreement.

3. A CSD and a service provider shall make available upon request to the competent

authority and the relevant authorities referred to in Article 12 all information necessary

to enable them to assess the compliance of the outsourced activities with the

requirements of this Regulation.

4. The outsourcing of a core service shall be subject to authorisation under Article 19 by

the competent authority.

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5. Paragraphs 1 to 4 shall not apply where a CSD outsources some of its services or

activities to a public entity and where that outsourcing is governed by a dedicated

legal, regulatory and operational framework which has been jointly agreed and

formalised by the public entity and the relevant CSD and agreed by the competent

authorities on the basis of the requirements established in this Regulation.

Article 31

Services provided by other parties than CSDs

1. Notwithstanding Article 30, Member States shall, where required by national law,

provide that a person other than CSDs is responsible for recording book entries into

securities accounts maintained by CSDs.

2. Member States that allow other parties to provide certain core services referred to in

section A of the Annex in accordance with paragraph 1 shall specify in their

national law the requirements that will apply in such a case. These requirements

shall include the provisions of this Regulation which shall apply both to the CSD

and, where relevant, to the other party concerned.

3. Member States allowing other parties to provide core services referred to in section

A of the Annex in accordance with paragraph 1 shall communicate to ESMA all the

relevant information concerning the provision of such services, including their

relevant national laws.

ESMA shall include such information in the CSD register referred to in Article 21.

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SECTION 2

CONDUCT OF BUSINESS RULES

Article 32

General provisions

▌

1. A CSD shall have clearly defined goals and objectives that are▌ achievable, such as in

the areas of minimum service levels, risk-management expectations and business

priorities.

2. A CSD shall have transparent rules for the handling of complaints.

Article 33▌

1. For each securities settlement system it operates a CSD shall have publicly disclosed

criteria for participation which allow fair and open access for all legal persons that

intend to become a participant. Such criteria shall be transparent, objective, ▌ and

non-discriminatory so as to ensure fair and open access to the CSD with due regard to

risks to financial stability and the orderliness of markets. Criteria that restrict access

shall only be permitted to the extent that their objective is to justifiably control a

specified risk for the CSD.

2. A CSD shall treat requests for access promptly by providing a response to such

requests within one month at the latest and shall make the procedures for treating

access requests publicly available.

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3. A CSD may only deny access to a participant meeting the criteria referred to in

paragraph 1 where it is duly justified in writing and based on a comprehensive risk

analysis.

In case of refusal, the requesting participant has the right to complain to the competent

authority of the CSD that has refused access.

The responsible competent authority shall duly examine the complaint by assessing the

reasons for refusal and shall provide the requesting participant with a reasoned reply.

The responsible competent authority shall consult the competent authority of the place

of establishment of the requesting participant on its assessment of the complaint.

Where the authority of the requesting participant disagrees with the assessment

provided, any one of the two competent authorities may refer the matter▌ to ESMA,

which may act in accordance with the powers conferred on it under Article 19 of

Regulation (EU) No 1095/2010.

Where the refusal by the CSD to grant access to the requesting participant is deemed

unjustified, the responsible competent authority shall issue an order requiring that CSD

to grant access to the requesting participant.

4. A CSD shall have objective and transparent procedures for the suspension and orderly

exit of participants that no longer meet the criteria for participation referred to in

paragraph 1.

5. ESMA shall, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the risks to be taken into account by CSDs

when carrying out a comprehensive risk assessment, and competent authorities

assessing the reasons for refusal in accordance with paragraph 3 and the elements of

the procedure referred to in paragraph 3.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first sub paragraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

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6. ESMA shall▌, in close cooperation with the members of the ESCB, develop draft

implementing technical standards to establish standard forms and templates for the

procedure referred to in paragraph 3.

ESMA shall submit those draft implementing technical standards to the Commission

by nine months from the date of entry into force of this Regulation.

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

Article 34

Transparency

1. For each securities settlement system it operates, as well as for ▌each of the other core

services it performs, a CSD shall publicly disclose the prices and fees associated with

the core services set out in Annex A that they provide. It shall disclose the prices and

fees of each service and function provided separately, including discounts and rebates

and the conditions to benefit from those reductions. It shall allow its clients separate

access to the specific services provided.

2. A CSD shall publish its price list so as to facilitate the comparison of offers and to

allow clients to anticipate the price they shall have to pay for the use of services.

3. A CSD shall be bound by its published pricing policy for its core services.

4. A CSD shall provide to its clients information that allows reconciling the invoice with

the published price lists.

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5. A CSD shall disclose to all clients information that allows clients to assess the risks

associated with the services provided.

6. A CSD shall account separately for costs and revenues of the core services provided

and shall disclose that information to the competent authority.

7. A CSD shall account for the cost and revenue of the ancillary services provided as a

whole and shall disclose that information to the competent authority.

8. In order to ensure effective application of Union competition rules and enable the

identification of, among other things, cross-subsidisation of ancillary services by

core services, a CSD shall maintain analytical accounting for its activities. Such

analytical accounts shall at least separate the costs and revenues associated with

each of its core services from those associated with ancillary services.

Article 35

Communication procedures with participants and other market infrastructures

CSDs shall use in their communication procedures with participants of the securities settlement

systems they operate, and with the market infrastructures they interface with international open

communication procedures and standards for messaging and reference data in order to facilitate

efficient recording, payment and settlement.

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SECTION 3

REQUIREMENTS FOR CSD SERVICES

Article 36

General provisions

For each securities settlement system it operates a CSD shall have appropriate rules and

procedures, including robust accounting practices and controls, to help ensure the integrity of

securities issues, reduce and manage the risks associated with the safekeeping and settlement of

transactions in securities.

Article 37

Integrity of the issue

1. A CSD shall take appropriate reconciliation measures to verify that the number of

securities making up a securities issue or part of a securities issue submitted to the

CSD is equal to the sum of securities recorded on the securities accounts of the

participants of the securities settlement system operated by the CSD and, where

relevant, on owner accounts maintained by the CSD. Such reconciliation measures

shall be conducted at least daily.

2. Where appropriate and if other entities are involved in the reconciliation process for a

certain securities issue, such as the issuer, registrars, issuance agents, transfer agents,

common depositories, other CSDs or other entities, the CSD and any such entities

shall organise adequate cooperation and information exchange measures with each

other so that the integrity of the issue is maintained.

3. Securities overdrafts, debit balances or securities creation shall not be allowed in a

securities settlement system operated by a CSD.

4. ESMA shall ▌, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the reconciliation measures a CSD shall take

under paragraphs 1 to 3.

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ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

Article 38

Protection of participants' and their clients' securities

1. For each securities settlement system it operates, a CSD shall keep records and

accounts that shall enable it, at any time and without delay, to segregate in the

accounts with the CSD, the securities of a participant from those of any other

participant and, if applicable, from the CSD's own assets.

2. A CSD shall keep records and accounts that enable any participant to segregate the

securities of the participant from those of the participant's clients.

3. A CSD shall keep records and accounts that enable any participant to hold in one

securities account the securities that belong to different clients of that participant

('omnibus client segregation')

4. A CSD shall▌ keep records and accounts enabling a participant to segregate the

securities of any of the participant's clients, if and as required by the participant

(‘individual client segregation’).

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5. A participant shall offer its client at least the choice between omnibus client

segregation and individual client segregation and inform them of the costs and risks

associated with each option.

However, a CSD and its participants shall provide individual clients segregation for

citizens and residents of and legal persons established in a member state where this

is required under the national law of the member state under which the securities

are constituted as it stands at the date of entry into force of this Regulation. This

obligation shall apply as long as the national law is not amended or repealed and its

objectives are still valid.

6. CSDs and their participants shall publicly disclose the levels of protection and the

costs associated with the different levels of segregation that they provide and shall

offer those services on reasonable commercial terms. Details of the different levels of

segregation shall include a description of the main legal implications of the

respective levels of segregation offered, including information on the insolvency law

applicable in the relevant jurisdictions.

7. A CSD shall not use for any purpose the securities that do not belong to it. A CSD

may however use securities of a participant where it has obtained that participant's

prior express consent. The CSD shall require the participants to obtain any

necessary prior consent from its clients.

▌

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Article 39

Settlement finality

1. A CSD shall ensure that the securities settlement system it operates offers adequate

protection to participants. Member States shall designate and notify the securities

settlement system operated by CSDs according to the procedures referred to in point

(a) of Article 2 of Directive 98/26/EC.

▌

2. A CSD shall ensure that each securities settlement system that it operates defines the

moments of entry and of irrevocability of transfer orders in that securities settlement

system in accordance with Articles 3 and 5 of Directive 98/26/EC.

3. A CSD shall disclose the rules governing the finality of transfers of funds and

securities in a securities settlement system▌.

4. Paragraphs 2 and 3 shall apply without prejudice to the provisions applicable to CSD

links and common settlement IT infrastructure provided under Article 48.

5. A CSD shall take all reasonable steps to ensure that, in accordance with the rules

referred to in paragraph 3, finality of transfers of securities and cash referred to in

paragraph 3 is achieved either in real time or intra-day and in any case no later than

by the end of the business day of the actual settlement date.▌

6. Where the CSD offers the services referred to in Article 40(2), it shall ensure that the

cash proceeds of securities settlements shall be available for recipients to use no later

than by the end of the business day of the intended settlement date.

7. All securities transactions against cash between direct participants to a securities

settlement system operated by a CSD and settled in that securities settlement system

shall be settled on a DVP basis.

▌

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Article 40

Cash settlement

1. For transactions denominated in the currency of the country where the settlement takes

place, a CSD shall settle the cash payments of its respective securities settlement

system through accounts opened with a central bank of issue of the relevant currency

whenever practical and available.

2. When it is not practical and available to settle in central bank accounts as provided in

paragraph 1, a CSD may offer to settle the cash payments for all or part of its

securities settlement systems through accounts opened with a credit institution or

through its own accounts. If a CSD offers to settle in accounts opened with a credit

institution or through its own accounts, it shall do so in accordance with the

provisions of Title IV.

▌

3. A CSD shall ensure that any information provided to market participants about the

risks and costs associated with settlement in the accounts of credit institutions or

through its own accounts is clear, fair and not misleading. A CSD shall make

available sufficient information to clients or potential clients to allow them to identify

and evaluate the risks and costs associated with settlement in the accounts of credit

institutions or through its own accounts and shall provide such information on

request.

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Article 41

Participant default rules and procedures

1. For each securities settlement system it operates, a CSD shall have effective and

clearly defined rules and procedures to manage the default of one or more participants

ensuring that the CSD can take timely action to contain losses and liquidity pressures

and continue to meet its obligations.

2. A CSD shall make its default rules and relevant procedures available to the public.

3. A CSD shall undertake with its participants and other relevant stakeholders periodic

testing and review of its default procedures to ensure that they are practical and

effective.

4. In order to ensure consistent application of this article, ESMA may, in close

cooperation with the members of the ESCB, issue guidelines in accordance with

Article 16 of Regulation (EU) No 1095/2010.

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SECTION 4

PRUDENTIAL REQUIREMENTS

Article 42

General requirements

A CSD shall adopt a sound risk-management framework for comprehensively managing legal,

business, operational and other direct or indirect risks, including measures to mitigate fraud

and negligence.

Article 43

Legal risks

1. For the purpose of its authorisation and supervision, as well as for the information of

its clients, a CSD shall have rules, procedures, and contracts that are clear and

understandable ▌ for all the securities settlement systems it operates and all other

services it provides.

2. A CSD shall design its rules, procedures and contracts so that they are enforceable in

all relevant jurisdictions, including in the case of the default of the participant.

3. A CSD conducting business in different jurisdictions shall take all reasonable steps to

identify and mitigate the risks arising from▌ potential conflicts of laws across

jurisdictions.

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Article 44

General business risk

A CSD shall have robust management and control systems as well as IT tools in order to

identify, monitor and manage general business risks, including losses from poor execution of

business strategy, cash flows▌ and operating expenses.

Article 45

Operational risks

1. A CSD shall identify▌ sources of operational risk, both internal and external, and

minimise their impact through the deployment of appropriate IT tools, controls and

procedures, including for all the securities settlement systems it operates.

2. A CSD shall maintain appropriate IT tools that ensure a high degree of security and

operational reliability, and have adequate capacity. IT tools shall adequately deal with

the complexity, variety and type of services and activities performed so as to ensure

high standards of security, the integrity and confidentiality of the information

maintained.

3. For▌ services it provides as well as for each securities settlement system it operates, a

CSD shall establish, implement and maintain an adequate business continuity policy

and disaster recovery plan to ensure the preservation of its services, the timely

recovery of operations and the fulfilment of the CSD’s obligations in the case of events

that pose a significant risk of disrupting operations.

4. The plan referred to in paragraph 3 shall▌ provide for the recovery of all transactions

and participants' positions at the time of disruption to allow the participants of a CSD

to continue to operate with certainty and to complete settlement on the scheduled date,

including by ensuring that critical IT systems can promptly resume operations from

the time of disruption. It shall include the setting up of a second processing site with

sufficient resources, capabilities▌, functionalities and appropriate staffing

arrangements.

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5. The CSD shall plan and carry out a programme of tests of the arrangements referred to

in paragraphs 1 to 4.

6. A CSD shall identify, monitor and manage the risks that key participants to the

securities settlement systems it operates, as well as service and utility providers, and

other CSDs or other market infrastructures might pose to its operations. It shall, upon

request, provide competent and relevant authorities with information on any such

risk identified.

It shall also inform the competent and relevant authorities without delay of any

operational incidents resulting from such risks.

7. ESMA shall▌, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the operational risks referred to in paragraphs

1 and 6, the methods to test, address or minimise those risks, including the business

continuity policies and disaster recovery plans referred to in paragraphs 3 and 4 and

the methods of assessment thereof. ESMA shall submit those draft regulatory technical

standards to the Commission by nine months from the date of entry into force of this

Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

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Article 46

Investment policy

1. A CSD shall hold its financial assets at central banks▌, authorised credit institutions or

authorised CSDs.

2. A CSD shall have prompt access to its assets, when required.

3. A CSD shall invest its financial resources only in cash or in highly liquid financial

instruments with minimal market and credit risk. These investments shall be capable of

being liquidated rapidly with minimal adverse price effect.

4. The amount of capital, including retained earnings and reserves of a CSD which are

not invested in accordance with paragraph 3 shall not be taken into account for the

purposes of Article 44(1).

5. A CSD shall ▌ ensure that its overall risk exposure to any individual institution with

which it holds its assets remains within acceptable concentration limits.

6. ESMA shall, in close cooperation with EBA and the members of the ESCB, develop

draft regulatory technical standards specifying the financial instruments that can be

considered as highly liquid with minimal market and credit risk as referred to in

paragraph 1, the appropriate timeframe for access to assets referred to in paragraph

2 and the concentration limits as referred to in paragraph 5. Such draft regulatory

technical standards shall where appropriate be aligned to the regulatory technical

standards adopted in accordance with Art. 47(8) of Regulation No 648/2012.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

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Article 47

Capital requirements

1. Capital, together with retained earnings and reserves of a CSD, shall be proportional to

the risks stemming from the activities of the CSD. It shall be at all times sufficient to:

(a) ensure that the CSD is adequately protected against operational, legal, ▌ custody

▌, investment and business risks▌ so that the CSD can continue to provide

services as a going concern;

(b) ensure an orderly winding-down or restructuring of the CSD's activities over an

appropriate time span ▌of▌ at least six months under a range of stress scenarios.

2. A CSD shall maintain a plan for the following:

(a) the raising of additional capital should its equity capital approach or fall below

the requirements provided in paragraph 1;

(b) the achieving of an orderly wind down or reorganisation of its operations and

services in case the CSD is unable to raise new capital.

The plan shall be approved by the management body or an appropriate committee of

the management body and updated regularly. Each update of the plan shall be

provided to the competent authority. The competent authority may require the CSD

to take additional measures or to make any alternative provision where the

competent authority considers that the CSD’s plan is insufficient.

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3. EBA shall ▌, in close cooperation with ESMA and the members of the ESCB,

develop draft regulatory technical standards specifying requirements regarding the

capital, retained earnings and reserves of a CSD referred to in paragraph 1.

EBA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1093/2010.

Section 5

Requirements for CSD links

Article 48

CSD links

1. Before establishing a CSD link and on an ongoing basis once the CSD link is

established, all CSDs concerned shall identify, assess, monitor and manage all

potential sources of risk for themselves and for their participants arising from the CSD

link and take appropriate measures to mitigate them.

2. CSDs that intend to establish links shall submit an application for authorisation to

the competent authority of the requesting CSD as required under point (d) of Article

19(1) or notify the competent and relevant authorities of the requesting CSD as

required under Article 19(5).

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3. A link shall provide adequate protection to the linked CSDs and their participants, in

particular as regards possible credits taken by CSDs and the concentration and

liquidity risks as a result of the link arrangement.

A link shall be supported by an appropriate contractual arrangement that sets out the

respective rights and obligations of the linked CSDs and, where necessary, of the

CSDs' participants. A contractual arrangement with cross-jurisdictional implications

shall provide for an unambiguous choice of law that govern each aspect of the link's

operations.

4. In case of a provisional transfer of securities between linked CSDs, retransfer of

securities prior to the first transfer becoming final shall be prohibited.

5. A CSD that uses an indirect link or an intermediary to operate a CSD link with

another CSD shall measure, monitor, and manage the additional risks arising from the

use of that indirect link or intermediary and take appropriate measures to mitigate

them.

6. Linked CSDs shall have robust reconciliation procedures to ensure that their respective

records are accurate.

7. Links between CSDs shall permit DVP settlement of transactions between participants

in linked CSDs, wherever practical and feasible. Detailed reasons for any CSD link

not allowing for DVP settlement shall be notified to the relevant and competent

authorities.

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8. Interoperable securities settlement systems and CSDs that use a common settlement

infrastructure shall establish identical moments of:

(a) entry of transfer orders into the system;

(b) irrevocability of transfer orders;

The securities settlement systems and CSDs referred to in the first

subparagraph shall use equivalent rules concerning the moment of finality of

transfers of securities and cash.

9. By [*OJ please insert date five years after the date of entry into force of this

Directive] all interoperable links between CSDs operating in Member States shall be,

where applicable, DVP-settlement supporting links.

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10. ESMA shall ▌, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the conditions as provided in paragraph 3

under which each type of link arrangement provides for adequate protection of the

linked CSDs and of their participants, in particular when a CSD intends to participate

in the securities settlement system operated by another CSD, the monitoring and

managing of additional risks referred to in paragraph 5 arising from the use of

intermediaries, the reconciliation methods referred to in paragraph 6, the cases where

DVP settlement through CSD links is practical and feasible as provided in paragraph 7

and the methods of assessment thereof.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Powers is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

▌

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Chapter IV

Access to CSDs

SECTION 1

ACCESS OF ISSUERS TO CSDS

Article 49

Freedom to issue in a CSD authorised in the EU

1. An issuer shall have the right to arrange for its securities admitted to trading on

regulated markets or MTFs or traded on trading venues to be recorded in any CSD

established in any Member State, subject to compliance by that CSD with conditions

referred to in Article 23.

Without prejudice to the issuer's right referred to in the first subparagraph,

corporate law or other similar law of the Member State under which the securities

are constituted shall continue to apply.

Member States shall ensure that a list of key relevant provisions of their laws

referred to in subparagraph 2 is compiled. Competent authorities shall communicate

that list to ESMA within three months after the entry into force of this Regulation.

ESMA shall publish the list within four months after the entry into force of this

Regulation.

The CSD may charge a reasonable commercial fee for the provision of its services to

issuers on a cost-plus basis, unless otherwise agreed by both parties.

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2. When an issuer submits a request for recording its securities in a CSD, the latter shall

treat such request promptly and in a non-discriminatory fashion and provide a

response to the requesting issuer within three months.

3. A CSD may refuse to provide services to an issuer. Such refusal may only be based on

a comprehensive risk analysis or if that CSD does not provide the services referred to

in point 1 of Section A of the Annex in relation to securities constituted under the

corporate law or other similar law of the relevant Member State.

4. Without prejudice to [insert references to AML directive], where a CSD refuses to

provide services to an issuer, it shall provide the requesting issuer with full written

reasons for its refusal.

In case of refusal, the requesting issuer shall have a right to complain to the competent

authority of the CSD that refuses to provide its services.

The competent authority of that CSD shall duly examine the complaint by assessing

the reasons for refusal provided by the CSD and shall provide the issuer with a

reasoned reply.

The competent authority of the CSD shall consult the competent authority of the place

of establishment of the requesting issuer on its assessment of the complaint. Where the

authority of the place of establishment of the requesting issuer disagrees with that

assessment, any one of the two competent authorities may refer the matter ▌to

ESMA, which may act in accordance with the powers conferred on it under Article 19

of Regulation (EU) No 1095/2010.

Where the refusal by the CSD to provide its services to an issuer is deemed unjustified,

the responsible competent authority shall issue an order requiring the CSD to provide

its services to the requesting issuer.

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5. ESMA shall, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the risks to be taken into account by CSDs

when carrying out a comprehensive risk assessment, and competent authorities

assessing the reasons for refusal in accordance with paragraphs 3 and 4, the

elements of the procedure referred to in paragraph 4.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

6. ESMA shall▌, in close cooperation with the members of the ESCB, develop draft

implementing technical standards to establish standard forms and templates for the

procedure referred to in paragraph 4.

▌

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

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Section 2

Access between CSDs

Article 50

Standard link access

A CSD shall have the right to become a participant of another CSD and set up a standard link

with that CSD in accordance with Article 33 and subject to the prior notification of the CSD

link provided under Article 19(5).

Article 51

Customised link access

1. Where a CSD requests another CSD to develop special functions for having access to

the latter, the receiving CSD may reject such request only based on risk considerations.

It may not deny a request on the grounds of loss of market share.

2. The receiving CSD may charge a reasonable commercial fee on a cost-plus basis

from the requesting CSD for making customised link access available▌, unless

otherwise agreed by both parties.

Article 52

Procedure for CSD links

1. When a CSD submits a request for access under Articles 50 and 51 to another CSD,

the latter shall treat such request promptly and provide a response to the requesting

CSD within three months.

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2. A CSD may only deny access to a requesting CSD where such access would threaten

the smooth and orderly functioning of the financial markets or cause systemic risk .

Such refusal can be based only on a comprehensive risk analysis.

Where a CSD refuses access, it shall provide the requesting CSD with full reasons for

its refusal.

In case of refusal, the requesting CSD has the right to complain to the competent

authority of the CSD that has refused access.

The ▌competent authority of the receiving CSD shall duly examine the complaint by

assessing the reasons for refusal and shall provide the requesting CSD with a reasoned

reply.

The ▌competent authority of the receiving CSD shall consult the competent authority

of the requesting CSD and the relevant authority of the requesting CSD referred to in

point (a) of Article 12(1) on its assessment of the complaint. Where any of the

authorities of the requesting CSD disagrees with the assessment provided, any one of

the▌ authorities may refer the matter to ESMA, which may act in accordance with the

powers conferred on it under Article 19 of Regulation (EU) No 1095/2010.

Where the refusal by the CSD to grant access to the requesting CSD is deemed

unjustified, the ▌ competent authority of the receiving CSD shall issue an order

requiring that CSD to grant access to the requesting CSD.

▌

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3. ESMA shall, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the risks to be taken into account by CSDs

when carrying out a comprehensive risk assessment, and competent authorities

assessing the reasons for refusal in accordance with paragraph 2 and the elements

of the procedure referred to in paragraph 2.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

4. ESMA shall develop, in close cooperation with the members of the ESCB develop

draft implementing technical standards to establish standard forms and templates for

the procedures referred to in paragraphs 1 to 3.

ESMA shall submit those draft implementing technical standards to the Commission

by nine months from the date of entry into force of this Regulation.

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

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Section 3

Access between a CSD and another market infrastructure

Article 53

Access between a CSD and another market infrastructure

1. A CCP and a trading venue shall provide transaction feeds on a non-discriminatory

and transparent basis to a CSD upon request by the CSD and may charge a reasonable

commercial fee for such transaction feeds to the requesting CSD on a cost-plus basis,

unless otherwise agreed by both parties.

A CSD shall provide access to its securities settlement systems on a non-

discriminatory and transparent basis to a CCP or a trading venue and may charge a

reasonable commercial fee for such access on a cost-plus basis, unless otherwise

agreed by both parties.

2. When a party submits a request for access to another party in accordance with

paragraph 1, such request shall be treated promptly and a response to the requesting

party shall be provided within three months.

3. The receiving party may only deny access where such access would affect the smooth

and orderly functioning of the financial markets or cause systemic risk. It may not

deny a request on the grounds of loss of market share.

A party that refuses access shall provide the requesting party with full written reasons

for such refusal based on a comprehensive risk analysis. In case of refusal, the

requesting party has the right to complain to the competent authority of the party that

has refused access.

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The responsible competent authority and the relevant authority referred to in point

(a) of Article 11(1) shall duly examine the complaint by assessing the reasons for

refusal and shall provide the requesting party with a reasoned reply.

The responsible competent authority shall consult the competent authority of the

requesting party and the relevant authority referred to in point (a) of Article 12(1) on

its assessment of the complaint. Where any of the authorities of the requesting party

disagrees with the assessment provided, any of them may refer the matter to ESMA,

which may act in accordance with the powers conferred on it under Article 19 of

Regulation (EU) No 1095/2010.

Where the refusal by a party to grant access is deemed unjustified, the responsible

competent authority shall issue an order requiring that party to grant access to its

services within three months.

4. ESMA shall, in close cooperation with the members of the ESCB, develop draft

regulatory technical standards to specify the risks to be taken into account by CSDs

when carrying out a comprehensive risk assessment, and competent authorities

assessing the reasons for refusal in accordance with paragraph 3 and the elements

of the procedure referred to in paragraph 3.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

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5. ESMA shall develop, in close cooperation with the members of the ESCB develop

draft implementing technical standards to establish standard forms and templates for

the procedure referred to in paragraphs 1 to 3.

ESMA shall submit those draft implementing technical standards to the Commission

by nine months from the date of entry into force of this Regulation.

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the second subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

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TITLE IV

CREDIT INSTITUTIONS DESIGNATED TO PROVIDE BANKING TYPE OF

ANCILLARY SERVICES FOR CSDS' PARTICIPANTS

Article 54

Authorisation and designation to provide banking type of ancillary services

1. A CSD shall not▌ itself provide any banking type of ancillary services set out in

Section C of the Annex unless it has obtained an additional authorisation to provide

such services in accordance with this Article.

2. A CSD that intends to settle the cash leg of all or part of its securities settlement

system in accordance with Article 40(2) or otherwise wishes to provide any banking

type of ancillary services referred to in paragraph 1 shall be authorised either:

(a) to designate for that purpose one or more authorised credit institutions as

provided in Title II of Directive 2006/48/EC; or

(b) to offer such services itself under the conditions specified in this Article.

3. Where a CSD seeks to provide any banking type of ancillary services from within the

same legal entity as the legal entity operating the securities settlement system the

authorisation referred to in paragraph 2 shall be granted only where the following

conditions are met:

(a) the CSD shall be authorised as a credit institution as provided in Title II of

Directive 2006/48/EC [new CRD IV];

In case of conflicting provisions set out in this Regulation as well as in Directive

2013/36/EU and Regulation (EU) No 575/2013, the CSD referred to in point

(a) shall comply with the stricter requirements on prudential supervision. The

regulatory technical standards referred to in Articles 47 and 59 of this

Regulation shall clarify the cases of conflicting provisions.

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(b) the authorisation referred to in point a shall be used only to provide the

banking type of ancillary services referred to in Section C of the Annex and

not to carry out any other activities;

(c) the CSD meets the prudential requirements as set out under Article 59(1), (3)

and (4) and supervisory requirements set out under Article 60;

(d) the CSD is subject to an additional capital surcharge that reflects the risks,

including credit and liquidity risks, resulting from the provision of intraday

credit to, amongst others, the participants to a securities settlement system or

other users of CSD services;

(e) the CSD reports at least monthly to the competent authority and annually in its

public Pillar 3 disclosure as required under Directive 2006/48/EC on the extent

and management of intra-day liquidity risk in accordance with paragraph

[6b/9]; and

(f) the CSD has submitted to the competent authority an adequate recovery plan

to ensure continuity of its critical operations, including in situations where

liquidity or credit risk crystallises as a result of the provision of banking

ancillary services;

4. Where a CSD seeks to provide any banking type of ancillary services from within a

separate legal entity which is part of the same group of undertakings ultimately

controlled by the same parent undertaking, the authorisation referred to in

paragraph 2 shall be granted only where the following conditions are met:

(a) the separate legal entity shall be authorised as a credit institution as provided

in Title II of Directive 2006/48/EC;

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(b) the separate legal entity meets the prudential requirements as set out under

Article 59(1), (3) and (4) and supervisory requirements set out under Article

60;

(c) the separate legal entity shall not itself carry out any of the core services

referred to in Section A of the Annex; and

(d) the authorisation referred to in point a) shall be used only to provide the

banking type of ancillary services referred to in Section C of the Annex and

not to carry out any other activities;

(e) the separate legal entity is subject to an additional capital surcharge that reflects

the risks, including credit and liquidity risks, resulting from the provision of

intraday credit to, amongst others, the participants to a securities settlement

system or other users of CSD services;

(f) the separate legal entity reports at least monthly to the competent authority and

annually in its public Pillar 3 disclosure as required under Directive

2006/48/EC on the extent and management of intra-day liquidity risk in

accordance with paragraph 6b; and

(g) the separate legal entity has submitted to the competent authority an adequate

recovery plan to ensure continuity of its critical operations, including in

situations where liquidity or credit risk crystallises as a result of the provision

of banking ancillary services from within a separate legal entity.

5. Where a CSD seeks to designate a credit institution which does not fall within the

scope of paragraphs 3 or 4, the authorisation referred to in paragraph 2 shall be

granted only where the following conditions are met:

(a) the credit institution shall be authorised as a credit institution as provided in

Title II of Directive 2006/48/EC;

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(b) the credit institution meets the prudential requirements as set out under Article

57(1), (3) and (4) and supervisory requirements set out under Article 58;

(c) the credit institution shall not itself carry out any of the core services referred

to in Section A of the Annex; and

(d) the authorisation referred to in point a shall be used only to provide the

banking type of ancillary services referred to in Section C of the Annex and

not to carry out any other activities.

(e) the credit institution is subject to an additional capital surcharge that reflects

the risks, including credit and liquidity risks, resulting from the provision of

intraday credit to, amongst others, the participants to a securities settlement

system or other users of CSD services

(f) the credit institution entity reports at least monthly to the competent authority

and annually in its public Pillar 3 disclosure as required under Directive

2006/48/EC on the extent and management of intra-day liquidity risk in

accordance with paragraph 9; and

(g) the credit institution has submitted to the competent authority an adequate

recovery plan to ensure continuity of its critical operations, including in

situations where liquidity or credit risk crystallises as a result of the provision

of banking ancillary services from within a separate legal entity.

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6. Paragraphs 4 and 5 shall not apply to credit institutions referred to in point (a) of

paragraph 2 that offer to settle the cash payments for part of the CSD's securities

settlement system, if the total value of such cash settlement through accounts opened

with these credit institutions, calculated over the period of one year, is less than one

per cent of the total value of all securities transactions against cash settled in the

books of the CSD and does not exceed a maximum of EUR 2,5 billion per year.

The competent authority shall monitor at least once per year that the threshold

defined in the first subparagraph is respected and report its findings to ESMA.

Where the competent authority determines that the threshold has been exceeded, it

shall require the CSD concerned to seek authorisation in accordance with

paragraphs 4 and 5 of this Article. The CSD concerned shall have a period of 6

months to submit its application for authorisation.

7. The competent authority referred to in Article 55(1) may require a CSD to designate

more than one credit institution, or to designate a credit institution in addition to

providing services itself in accordance with paragraph 2(b) where it considers that

the exposure of one credit institution to the concentration of risks under Article

59(3) and the (4) is not sufficiently mitigated. The designated credit institutions shall

be considered as settlement agents.

8. A CSD authorised to provide any banking type of ancillary services and a credit

institution designated in accordance with paragraph 2(a) shall comply at all times with

the conditions necessary for authorisation under this Regulation and shall, without▌

delay, notify the competent authorities of any material changes affecting the conditions

for authorisation.

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9. EBA shall, in close cooperation with ESMA and the members of the ESCB, develop

draft regulatory technical standards to determine the additional, risk based capital

surcharge referred to in point (e) of paragraph 3, point (e) of paragraph 4 and point

(e) of paragraph 5.

EBA shall submit those draft regulatory technical standards to the Commission by

nine months after the entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first sub-paragraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

Article 55

Procedure for granting and refusing authorisation to provide banking type of ancillary services

1. The CSD shall submit its application for authorisation to designate a credit institution

or to provide any banking type of ancillary service, as required under Article 54, to

the competent authority of the Member State where it is established.

2. The application shall contain all the information that is necessary to enable the

competent authority to satisfy itself that the CSD and where applicable the designated

credit institution have established, at the time of the authorisation, all the necessary

arrangements to meet their obligations set out in this Regulation. It shall contain a

programme of operations setting out the banking type of ancillary services envisaged,

the structural organisation of the relations between the CSD and the designated credit

institutions where applicable and how that CSD or where applicable the designated

credit institution intends to meet the prudential requirements as set out under Article

59(1), (3) and (4) and the other conditions set out in Article 54.

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3. The competent authority shall apply the procedure under Article 17(3) and (7).

4. As from the moment when the application is considered to be complete, the

competent authority shall transmit all information included in the application to the

following authorities:

(a) The relevant authorities referred to in Article 12(1);

(b) The relevant competent authority referred to in Article 4 (4) of the Directive

2006/48/EC;

(c) the competent authorities in the Member State(s) where the CSD has

established interoperable links with another CSD except where the CSD has

established interoperable links referred to in Article 19(5);

(d) the competent authorities in the host Member State where the activities of the

CSD are of substantial importance for the functioning of the securities

markets and the protection of investors within the meaning of Article 24(4);

(e) the competent authorities responsible for the supervision of the participants of

the CSD that are established in the three Member States with the largest

settlement values in the CSD's securities settlement system on an aggregate

basis over a one-year period;

(f) ESMA and EBA.

5. The authorities referred to in points (a) to (e) of the first sub-paragraph shall issue a

reasoned opinion on the authorisation within 30 days of receipt of the information

referred to in the first sub-paragraph. Where an authority does not provide an

opinion within that deadline it shall be deemed to have a positive opinion.

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Where at least one of the authorities referred to in points (a) to (e) of the first sub-

paragraph issues a negative reasoned opinion, the competent authority wishing to

grant the authorisation shall within 30 days provide the authorities referred to in

points (a) to (e) of the first sub-paragraph with a reasoned decision addressing the

negative opinion.

Where 30 days after that decision has been presented any of the authorities referred

to in points (a) to (e) of the first sub-paragraph 4 issues a negative opinion and the

competent authority still wishes to grant the authorisation any of the authorities that

issued a negative opinion may refer the matter to ESMA for assistance under Article

31 point (c) of Regulation (EU) No. 1095/2010.

Where 30 days after referral to ESMA the issue is not settled, the competent

authority wishing to grant the authorisation shall take the final decision and provide

a detailed explanation of its decision in writing to the authorities referred to in

points (a) to (e) of the first sub-paragraph.

Where the competent authority wishes to reject the authorisation, the matter shall

not be referred to ESMA.

Negative opinions shall state in writing the full and detailed reasons why the

requirements laid down in this Regulation or other parts of Union law are not met.

6. Where ESMA considers that the competent authority referred to in paragraph 1 has

granted an authorisation which may not be inconformity with Union law it shall act

in accordance with Article 17 of Regulation EU No. 1095/2010.

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7. ESMA shall▌, in close cooperation with the members of the ESCB and EBA, develop

draft regulatory technical standards to specify the information that the ▌CSD shall

provide to the competent authority for the purpose of obtaining the relevant

authorisations to provide the banking services ancillary to settlement.

ESMA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1095/2010.

8. ESMA shall develop, in close cooperation with the members of the ESCB and EBA,

develop draft implementing technical standards to establish standard forms, templates

and procedures for the consultation of the authorities referred to in paragraph 4 prior to

granting authorisation.

ESMA shall submit those draft implementing technical standards to the Commission

by nine months from the date of entry into force of this Regulation.

Power is conferred on the Commission to adopt the implementing technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Article 15 of Regulation (EU) No 1095/2010.

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Article 56

Extension of the banking type of ancillary services

1. A CSD that intends to extend the banking type of ancillary services for which it

designates a credit institution or that it provides itself in accordance with Article 54,

shall submit a request for extension to the competent authority of the Member State

where that CSD is established.

2. The request for extension shall be subject to the procedure under Article 55.

Article 57

Withdrawal of authorisation

1. Without prejudice to any remedial actions or measures under Title V, the competent

authority of the Member State where the CSD is established shall withdraw the

authorisations referred to in Article 54 in any of the following circumstances:

(a) where the CSD has not made use of the authorisation within 12 months,

expressly renounces the authorisation or where the designated credit institution

has provided no services or performed no activity for the preceding six months;

(b) where the CSD has obtained the authorisation by making false statements or by

any other unlawful means;

(c) where the CSD or the designated credit institution are no longer in compliance

with the conditions under which authorisation was granted and have not taken

the remedial actions requested by the competent authority within a set time

frame;

(d) where the CSD or the designated credit institution have seriously and

systematically infringed the requirements set out in this Regulation.

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A CSD and the designated credit institution shall establish, implement and maintain

an adequate procedure ensuring the timely and orderly settlement and transfer of

the assets of clients and participants to another settlement agent in the event of a

withdrawal of authorisation referred to in the first subparagraph.

2. As from the moment it becomes aware of one of the circumstances referred to in

paragraph 1, the competent authority shall immediately consult the ▌ authorities

referred to in Article 55(4) on the necessity to withdraw the authorisation ▌.

3. ESMA, any relevant authority under point (a) of Article 11(1) and any authority

referred to in Article 60(1) or, respectively, the authorities referred to in Article 55(4)

may, at any time, request that the competent authority of the Member State where the

CSD is established examine whether the CSD and where applicable the designated

credit institution are still in compliance with the conditions under which the

authorisation is granted.

4. The competent authority may limit the withdrawal to a particular service, activity, or

financial instrument.

Article 58

CSD Register

1. Decisions taken by competent authorities under Articles 54, 56 and 57 shall be notified

to ESMA.

2. ESMA shall introduce in the list that it is required to publish on its dedicated website

in accordance with Article 21(3), the following information:

(a) the name of each CSD which was subject to a decision under Articles 54, 56 and

57;

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(b) the name of each designated credit institution;

(c) the list of banking type of ancillary services that a designated credit institution or

a CSD authorised under Article 54 is authorised to provide for CSD's

participants.

3. The competent authorities shall notify to ESMA those institutions that provide banking

type of ancillary services according to requirements of national law 90 days from the

entry into force of this Regulation.

Article 59

Prudential requirements applicable to credit institutions or CSDs authorised to provide banking

type of ancillary services

1. A credit institution designated under Article 54 or a CSD authorised under Article 54

to provide banking type of ancillary services shall provide only the services set out in

Section C of the Annex that are covered by the authorisation.

2. A credit institution designated under Article 54 or a CSD authorised under Article 54

to provide banking type of ancillary services shall comply with any present or future

legislation applicable to credit institutions.

3. A credit institution designated under Article 54 or a CSD authorised under Article 54

to provide banking type of ancillary services shall comply with the following specific

prudential requirements for the credit risks related to these services in respect of each

securities settlement system:

(a) it shall establish a robust framework to manage the corresponding credit risks;

(b) it shall identify the sources of such credit risk, frequently and regularly, measure

and monitor corresponding credit exposures and use appropriate risk-

management tools to control these risks;

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(c) it shall fully cover corresponding credit exposures to individual borrowing

participants using collateral and other equivalent financial resources;

(d) if collateral is used to manage its corresponding credit risk, it shall accept highly

liquid collateral with minimal credit▌ and market risk; it may use other types of

collateral in specific situations if an appropriate haircut is applied;

(e) it shall establish and apply appropriately conservative haircuts and concentration

limits on collateral values constituted to cover the credit exposures referred to in

point (c), taking into account the objectives of ensuring that collateral can be

liquidated promptly without significant adverse price effects;

(g) it shall set limits on its corresponding credit exposures;

(h) it shall analyse and plan for how to address any potential residual credit

exposures, adopt rules and procedures to implement such plans;

(i) it shall provide credit only to participants that have cash accounts with it;

(j) it shall provide for effective reimbursement procedures of intraday credit and

discourage overnight credit through the application of sanctioning rates which

act as an effective deterrent.

4. A credit institution designated under Article 54 or a CSD authorised under Article

54, to provide banking type of ancillary services shall comply with the following

specific prudential requirements for the liquidity risks related to these services in

respect of each securities settlement system:

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(a) it shall have a robust framework and tools to measure, monitor, and manage its

liquidity risks, including intraday liquidity risks, for each currency of the

security settlement system for which it act as settlement agent;

(b) it shall measure and monitor on an ongoing and timely basis, and at least

daily, its liquidity needs and the level of liquid assets it holds; in doing so, it

shall determine the value of its available liquid assets taking into account

appropriate haircuts on these assets;

(c) it shall have sufficient liquid resources in all relevant currencies for a timely

provision of settlement services under a wide range of potential stress

scenarios including, but not limited to the liquidity risk generated by the default

of at least one participant, including their parent undertakings and

subsidiaries, to which it has the largest exposures;

(d) it shall mitigate the corresponding liquidity risks with qualifying liquid

resources in each currency such as cash at the central bank of issue and at

other creditworthy financial institutions, committed lines of credit or other

similar arrangements and highly liquid collateral or investments that are

readily available and convertible into cash with prearranged and highly

reliable funding arrangements, even in extreme but plausible market

conditions. It shall identify, measure and monitor its liquidity risk stemming

from the various financial institutions used for the management of its liquidity

risks;

(e) whenever prearranged funding arrangements are used, it shall only select

creditworthy financial institutions as liquidity providers; it shall establish and

apply appropriate concentration limits for each of the corresponding liquidity

providers including its parent undertaking and subsidiaries;

(f) it shall determine and test the sufficiency of the corresponding resources by

regular and rigorous stress testing;

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(g) it shall analyse and plan for how to address any unforeseen and potentially

uncovered liquidity shortfalls, and adopt rules and procedures to implement such

plans;

(h) where practical and available, without prejudice to eligibility rules of central

bank, it shall have access to central bank accounts and other central bank

services to enhance its management of liquidity risks and Union credit

institutions shall deposit the corresponding cash balances on dedicated accounts

with Union central banks of issue;

(i) it shall have prearranged and highly reliable arrangements to ensure that it can

timely liquidate, the collateral provided to it by a defaulting client.

(j) it shall report regularly to the authorities referred to in Article 60(1) about how

it measures, monitors and manages its liquidity risks, including intraday

liquidity risks.

5. EBA shall, in close cooperation with ESMA and the members of the ESCB, ▌develop

draft regulatory technical standards to further specify details of the frameworks and

tools for the monitoring, the measuring and the management and the reporting of

the credit and liquidity risks, including those which occur intraday, referred to in

paragraphs 3 and 4. Such draft regulatory technical standards shall , where

appropriate, be aligned to the regulatory technical standards adopted in accordance

with Art. 46(3) of Regulation No 648/2012.

▌

EBA shall submit those draft regulatory technical standards to the Commission by

nine months from the date of entry into force of this Regulation.

Power is delegated to the Commission to adopt the regulatory technical standards

referred to in the first subparagraph in accordance with the procedure laid down in

Articles 10 to 14 of Regulation (EU) No 1093/2010.

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Article 60

Supervision of designated credit institutions and CSDs authorised to provide banking type of

ancillary services

1. Without prejudice to Articles 17 and 22 of this Regulation, the competent authorities

referred to in point 40 of Article 4(1) of Regulation 575/2013 are responsible for the

authorisation as credit institutions and supervision as credit institutions under the

conditions provided in Directive 2013/36/EU and Regulation (EU) 575/2013 of the

designated credit institutions and CSDs authorised under this Regulation to provide

banking type of ancillary services▌.

The competent authorities referred to in the first subparagraph shall also be

responsible for the supervision of designated credit institutions and CSDs referred to

in that subparagraph as regards their compliance with the prudential requirements

referred to in Article 59▌ of this Regulation.

The competent authority referred to in the first subparagraph shall regularly, and at

least once a year, assess whether the designated credit institution or CSD authorised

to provide banking type of ancillary services complies with Article 59 and shall

inform the competent authority of the CSD which shall then inform the authorities

referred to in Article 55(4), of the results, including any remedial actions or

penalties, of its supervision under this paragraph.

2. The competent authority of the CSD, after consulting the competent authority referred

to paragraph 1, shall review and evaluate at least on an annual basis the following:

(a) in the case referred to in point (a) of Article 54(2), whether all the necessary

arrangements between the designated credit institutions and the CSD allow them

to meet their obligations set out in this Regulation.

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(b) in the cases referred to in point (b) of Article 54(2), whether the arrangements

relating to the authorisation to provide banking type of ancillary services allow

the CSD to meet its obligations set out in this Regulation.

The competent authority of the CSD shall regularly, and at least once a year, inform

the authorities referred to in Article 55(4) of the results, including any remedial

actions or penalties, of its review and evaluation under this paragraph.

Where a CSD designates an authorised credit institution in accordance with Article

54, in view of the protection of the participants to the securities settlement systems it

operates, a CSD shall ensure that it has access from the credit institution it designates

to all necessary information for the purpose of this Regulation and it shall report any

breaches thereof to the competent authorities referred to in paragraph 1 and in Article

109.

3. In order to ensure consistent, efficient and effective supervision within the Union of

credit institutions and CSDs authorised to provide banking type of ancillary services,

EBA, may in close cooperation with ESMA and the members of the ESCB,▌ issue

guidelines addressed to competent authorities in accordance with Article 16 of

Regulation (EU) No 1093/2010.

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Title V

Sanctions

Article 61

Administrative sanctions and measures

1. Without prejudice to the right of Member States to provide for and impose criminal

sanctions, Member States shall lay down rules on and ensure that their competent

authorities may impose the administrative sanctions and measures applicable in the

circumstances defined in Article 60 to the persons responsible for breaches of the

provisions of this Regulation and shall take all measures necessary to ensure that they

are implemented. Such sanctions and measures shall be effective, proportionate and

dissuasive.

Member States may decide not to lay down rules for administrative sanctions on

infringements that are already subject to national criminal law at the latest 24

months after the entry into force of this Regulation. In this case, Member States

shall communicate to the Commission and ESMA the relevant criminal law rules.

By 24 months after the entry into force of this Regulation, the Member States shall

notify the rules referred to in the first subparagraph to the Commission and ESMA.

Member States shall notify the Commission and ESMA without undue delay of any

subsequent amendments thereto.

2. The competent authorities shall be able to apply administrative sanctions and

measures, to CSDs, designated credit institutions, and, subject to the conditions laid

down in national law in areas not harmonised by this Regulation, the members of

their management bodies and any other persons who effectively control their business

as well as to any other legal or natural person who under national law is held

responsible for a breach.

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3. In the exercise of their sanctioning powers in the circumstances defined in Article 63

competent authorities shall cooperate closely to ensure that the administrative

sanctions and measures produce the desired results of this Regulation and coordinate

their action in order to avoid any duplication or overlap when applying administrative

sanctions and measures to cross border cases in accordance with Article 13.

4. Where Member States have chosen, in accordance with paragraph 1 to lay down

criminal sanctions for the breaches of the provisions referred to in this Article, they

shall ensure that appropriate measures are in place so that competent authorities

have all the necessary powers to liaise with judicial authorities within their

jurisdiction to receive specific information related to criminal investigations or

proceedings commenced for possible breaches of this Regulation and provide the

same to other competent authorities and ESMA to fulfil their obligation to cooperate

with each other and ESMA for the purposes of this Regulation.

5. Competent authorities may also cooperate with competent authorities of other

Member States with respect to facilitating the recovery of pecuniary sanctions.

6. Member States shall provide ESMA annually with aggregated information

regarding all sanctions and measures imposed in accordance with paragraph 1.

ESMA shall publish that information in an annual report.

Where Member States have chosen, in accordance with paragraph 1, to lay down

criminal sanctions for the breaches of the provisions referred to in Article 63 their

competent authorities shall provide ESMA annually with anonymised and

aggregated data regarding all criminal investigations undertaken and criminal

penalties imposed. ESMA shall publish data on criminal sanctions imposed in an

annual report.

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7. Where the competent authority has disclosed an administrative measure, or sanction

or criminal sanction to the public, it shall, at the same time, report that fact to

ESMA.

8. Competent authorities shall exercise their functions and powers in accordance with

their national frameworks:

(a) directly;

(b) in collaboration with other authorities;

(c) under their responsibility by delegation to entities to which tasks have been

delegated according to this Regulation; or

(d) by application to the competent judicial authorities

Article 62

Publication of sanctions and measures

1. Member States shall ensure that the competent authorities publish on their official

website any decision imposing administrative sanction or measure for breach of this

Regulation without undue delay after the person sanctioned is informed of that

decision. The publication shall include at least information on the type and nature

of the breach and the identity of a natural or legal person on whom the sanction is

imposed.

Where the decision to impose a sanction or measure is subject to an appeal before

the relevant judicial or other relevant authorities, competent authorities shall,

without undue delay, also publish immediately on their official website information

on the appeal status and outcome thereof. Moreover, any decision annulling a

previous decision to impose a sanction or a measure shall also be published.

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Where the publication of the identity of the legal persons or of the personal data of

the natural persons is considered by the competent authority to be disproportionate

following a case-by-case assessment conducted on the proportionality of the

publication of such data, or where publication jeopardises the stability of financial

markets or an on-going investigation, Member States shall ensure that competent

authorities shall either:

2. Competent authorities shall publish the sanctions on an anonymous basis, in a

manner which is in conformity with national law, in any of the following

circumstances:

(a) delay the publication of the decision to impose the sanction or measure until

the moment where the reasons for non-publication cease to exist;

(b) publish the decision to impose the sanction or measure on an anonymous basis

in a manner which is in conformity with national law, if such anonymous

publication ensures an effective protection of the personal data;

(c) not publish the decision to impose a sanction or measure at all in the event that

the options set out in (a) and (b) above are considered insufficient to ensure:

(i) that the stability of financial markets would not be put in jeopardy;

(ii) the proportionality of the publication of such decisions with regard to

measures which are deemed to be of a minor nature.

In the case of a decision to publish a sanction or measure on an anonymous

basis, the publication of the relevant data may be postponed for a reasonable

period of time if it is foreseen that within that period the reasons for

anonymous publication shall cease to exist.

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Competent authorities shall inform ESMA of all administrative sanctions

imposed but not published in accordance with paragraph 1(c) including any

appeal in relation thereto and the outcome thereof. Member States shall

ensure that competent authorities receive information and the final judgement

in relation to any criminal sanction imposed and submit it to ESMA. ESMA

shall maintain a central database of sanctions communicated to it solely for

the purposes of exchanging information between competent authorities. That

database shall be accessible to competent authorities only and it shall be

updated on the basis of the information provided by the competent authorities.

3. Competent authorities shall ensure that any publication, in accordance with this

Article, shall remain on their official website for a period of at least five years after

its publication. Personal data contained in the publication shall only be kept on the

official website of the competent authority for the period which is necessary in

accordance with the applicable data protection rules.

Article 63

Sanctions for infringements

1. This Article shall apply to the following provisions of this Regulation:

(a) provision of services set out in Sections A, B and C of the Annex in breach of

Articles 16, 25 and 54;

(b) obtaining the authorisations required under Articles 16 and 54 by making false

statements or by any other unlawful means as provided in point (b) of Article

20(1), and point (b) of Article 57(1);

(c) failure of CSDs to hold the required capital in breach of Article 47(1);

(d) failure of CSDs to comply with the organisational requirements in breach of

Articles 26 to 30;

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(e) failure of CSDs to comply with the conduct of business rules in breach of

Articles 32 to 35;

(f) failure of CSDs to comply with the requirements for CSD services in breach of

Articles 37 to 41;

(g) failure of CSDs to comply with the prudential requirements in breach of Articles

43 to 47;

(h) failure of CSDs to comply with the requirements for CSD links in breach of

Article 48;

(i) abusive refusals by CSDs to grant different types of access in breach of Articles

49 to 53;

(j) failure of designated credit institutions to comply with the specific prudential

requirements related to credit risks in violation of Article 59(3);

(k) failure of designated credit institutions to comply with specific prudential

requirements related to liquidity risks in violation of Article 59(4).

2. Without prejudice to the supervisory powers of competent authorities, at least in case

of a breach referred to in this Article, the competent authorities shall, in conformity

with national law, have the power to impose at least the following administrative

sanctions and measures:

(a) a public statement which indicates the person responsible for the breach and the

nature of the breach in accordance with Article 61;

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(b) an order requiring the person responsible for the breach to cease the conduct and

to desist from a repetition of that conduct;

(c) withdrawal of the authorisations granted under Articles 16 and 54, in accordance

with Articles 20 and 57;

(d) a temporary or, for repeated serious breaches, a permanent ban a against any

member of the institution’s management body or any other natural person,

who is held responsible, to exercise management functions in the institution;

(e) maximum administrative pecuniary sanctions of at least twice the amounts of

the profit gained as a result of a breach where those amounts can be determined;

(f) in respect of a natural person, maximum administrative pecuniary sanctions of at

least EUR 5 million or in the Member States where the Euro is not the official

currency, the corresponding value in the national currency on the date of

adoption of this Regulation;

(g) in case of a legal person, maximum administrative pecuniary sanctions of up to

at least EUR 20 million or up to 10 % of the total annual turnover of the legal

person according to the last available accounts approved by the management

body; where the legal person is a parent undertaking or a subsidiary of the

parent undertaking which has to prepare consolidated financial accounts

according to Directive 83/349/EC, the relevant total annual turnover shall be the

total annual turnover or the corresponding type of income according to the

relevant Accounting Directives according to the last available consolidated

accounts approved by the management body of the ultimate parent

undertaking▌;

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3. Competent authorities may have other sanctioning powers in addition to those referred

in paragraph 2 and may provide for higher levels of administrative pecuniary sanctions

than those established in that paragraph.

▌

Article 64

Effective application of sanctions

1. Member States shall ensure that, when determining the type and level of

administrative sanctions or measures, the competent authorities shall take into account

all relevant circumstances, including, where appropriate:

(a) the gravity and the duration of the breach;

(b) the degree of responsibility of the person responsible for the breach;

(c) the ▌financial strength of the person responsible for the breach, for example as

indicated by the total turnover of the responsible legal person or the annual

income of the responsible natural person;

(d) the importance of the profits gained, losses avoided by the person responsible

for the breach or the losses for third parties derived from the breach, insofar as

they can be determined;

(e) the level of cooperation of the person responsible for the breach with the

competent authority, without prejudice to the need to ensure disgorgement of

profits gained or losses avoided by that person;

(f) previous breaches by the person responsible for the breach.

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Article 65

Reporting of violations

1. Member States shall ensure that competent authorities establish effective

mechanisms to encourage reporting of potential or actual breaches of this Regulation

to competent authorities.

2. The mechanisms referred to in paragraph 1 shall include at least:

(a) specific procedures for the receipt and investigation of reports on potential or

actual breaches and their follow-up, including the establishment of secure

communication channels for such reports;

(b) appropriate protection for employees of institutions who report potential or

actual breaches committed within the institution against retaliation,

discrimination or other types of unfair treatment at a minimum;

(c) protection of personal data concerning both the person who reports the potential

or actual breaches and the natural person who is allegedly responsible for a

breach in compliance with the principles laid down in Directive 95/46/EC;

(d) protection of the identity of both the person who reports the breaches and the

natural person who is allegedly responsible for a breach, at all stages of the

procedures unless such disclosure is required by national law in the context of

further investigation or subsequent administrative or judicial proceedings.

3. Member States shall require institutions to have in place appropriate procedures for

their employees to report actual or potential breaches internally through a specific,

independent and autonomous channel.

Such a channel may also be provided through arrangements provided for by social

partners. The same protection as referred to in points (b), (c) and (d) of paragraph 2

shall apply.

172

Article 66

Right of appeal

Member Sates shall ensure that decisions and measures taken in pursuance of this

Regulation are properly reasoned and subject to the right of appeal before a tribunal. The

right of appeal before a tribunal shall apply where no decision is taken, within six months of

its submission, in respect of an application for authorisation which contains all the

information required under the provisions in force.

Title VI

Delegated acts, transitional provisions, amendment to Directive 98/26/EC and final provisions

Article 67

Delegation of powers

The Commission shall be empowered to adopt delegated acts in accordance with Article 68

concerning Articles

Article 68

Exercise of the delegation

1. The power to adopt delegated acts is conferred to the Commission subject to the

conditions laid down in this Article.

2. The delegation of power referred to in Article 67 shall be conferred for an

indeterminate period of time from the date of entry into force of this Regulation.

173

3. The delegation of powers referred to in Article 67 may be revoked at any time by the

European Parliament or by the Council. A decision of revocation shall put an end to

the delegation of the power specified in that decision. It shall take effect the day

following the publication of the decision in the Official Journal of the European Union

or at a later date specified therein. It shall not affect the validity of any delegated acts

already in force.

4. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to

the European Parliament and to the Council.

5. A delegated act adopted pursuant to Article 67 shall enter into force only if no

objection has been expressed either by the European Parliament or the Council within

a period of three months of notification of that act to the European Parliament and the

Council or if, before the expiry of that period, the European Parliament and the

Council have both informed the Commission that they will not object. That period

shall be extended by three months at the initiative of the European Parliament or the

Council.

Article 69

Implementing powers

The Commission shall be empowered to adopt implementing acts under Article 25(7)▌. Those

implementing acts shall be adopted in accordance with the examination procedure referred to in

Article 70(2).

Article 70

Committee procedure

1. The Commission shall be assisted by the European Securities Committee established

by Commission Decision 2001/528/EC1. That Committee shall be a committee in the

meaning of Regulation (EU) No 182/2011.

1 OJ L 191, 13.7.2001, p. 45.

174

2. Article 5 of Regulation (EU) No 182/2011 shall apply when the Commission exercises

the implementing powers conferred by this Regulation.

Article 71

Transitional provisions

1. The competent authorities referred to in Article 10 shall communicate to ESMA

those institutions that operate as CSDs within 90 days from the date of entry into

force of this Regulation.

2. CSDs shall apply for all authorisations that are necessary for the purposes of this

Regulation and shall notify the relevant CSD links within six months from the date of

entry into force of all the regulatory technical standards under Articles 17, 26, 45,

47, 48, and, whenever relevant, 55, and 59.

3. Within six months from whichever the latest of the date of entry into force of the

regulatory technical standards under Articles 12, 17, 25, 26, 45, 47, 48, and,

whenever relevant, 55, and 59 and the Commission's decision referred to in Article

25(7), a third country CSD shall apply for recognition from ESMA where it intends to

provide its services on the basis of Article 25.

▌

4. Until the decision is made under this Regulation on the authorisation or recognition

of CSDs and of their activities, including CSD links, the respective national rules on

authorisation and recognition of CSDs shall continue to apply.

5. The CSDs operated by the institutions referred to in Article 1(4) shall comply with

the requirements of this Regulation at the latest within one year from the date of

entry into force of the regulatory technical standards referred to in paragraph 1.

175

Article 72

Amendment to Directive 98/26/EC

1. The third indent of the first subparagraph of point (a) of Article 2 of Directive

98/26/EC is replaced by the following:

"- designated, without prejudice to other more stringent conditions of general

application laid down by national law, as a system and notified to the European

Securities and Markets Authority by the Member State whose law is applicable,

after that Member State is satisfied as to the adequacy of the rules of the

system.".

2. By six months after the entry into force of this Regulation▌, Member States shall adopt

and publish and communicate to the Commission measures necessary to comply with

the third indent of the first subparagraph of point (a) of Article 2 of Directive

98/26/EC, as amended by this Regulation.

Article 72a

Amendment to Regulation (EU) No 236/2012

Article 15 of Regulation (EU) No 236/2012 is deleted.

Article 73

Application of Directive xxxx/xxxx/EU [new MiFID] and Regulation EU No. Xxxx [MiFIR]

CSDs authorised in accordance with Article 16 of this Regulation shall not require

authorisation under Directive xxxx/xxxx/EU [new MiFID] in order to provide the services

explicitly listed in Sections A and B of the Annex to this Regulation.

Where a CSD authorised in accordance with Article 16 provides one or more investment

services or carries out one or more investment activities in addition to providing the services

explicitly listed in sections A and B of the Annex to this Regulation, Directive xxxx/xxxx/EU

[new MiFID] with the exception of Articles 5 to 8, Article 9(1) to (2) , (4) to (6) and Articles

10 to 13 and Regulation EU No. Xxxxx [MiFIR] shall apply.

176

Article 74

Reports and review

1. ESMA, in cooperation with EBA and the authorities referred to in Articles 10 and 12,

shall submit annual reports to the Commission providing assessments of trends,

potential risks and vulnerabilities, and, where necessary, recommendations of

preventative or remedial action in the markets for services covered by this Regulation.

Those reports shall include at least an assessment of the following:

(a) settlement efficiency for domestic and cross-border operations for each Member

State based on the number and volume of settlement fails, amount of penalties

referred to in Article 7(4), number and volumes of buy-in transactions referred to

in Article 7(4) and any other relevant criteria;

(b) appropriateness of penalties for settlement fails, in particular the need for

additional flexibility in relation to penalties for settlement fails in relation to

illiquid financial instruments referred to in Article 5(1).

(c) ▌measuring settlement which does not take place in the securities settlement

systems operated by CSDs based on the number and volume of transactions and

any other relevant criteria based on the information received under Article 9;

(d) ▌the cross-border provision of services covered by this Regulation based on the

number and types of CSD links, number of foreign participants to the securities

settlement systems operated by CSDs, number and volume of transactions

involving such participants, number of foreign issuers recording their securities

in a CSD in accordance with Article 49 and any other relevant criteria;

(e) an assessment of the handling of access requests in Articles 49, 52 and 53 to

identify the reasons for rejection of access requests by CSDs, CCPs, trading

venues any trends in such rejections and ways in which the risks identified

could be mitigated in future so as to allow for access to be granted , and any

other material barriers to competition in post-trade financial services.

177

(f) an assessment of the handling of applications submitted in accordance with the

procedures referred to in Article 23 paragraph 3 to 7 and Article 25 paragraph 4 to

10;

(g) where applicable, the findings of the peer review process for cross-border

supervision in Article 24(6) and whether the frequency of such reviews could be

reduced in future, including an indication of whether such findings indicate the

need for more formal colleges of supervisors;

(h) the application of civil liability rules of Member States relating to the losses

attributable to CSDs;

(i) an assessment of the procedures and conditions under which the CSDs have been

authorised to designate credit institutions or to provide themselves banking type of

ancillary services in accordance with Articles 54 and 55, including an assessment of

the effects that such provision may have on financial stability and competition for

settlement and banking types of ancillary services in the Union;

(j) an assessment of the application of the rules referred to in Article 38 on protection

of participants and their clients' securities, in particular those in Article 38(4);

(k) the application of the sanctions and in particular the need to further harmonise the

administrative sanctions set out for the breach of the requirements set out in this

Regulation.

2. The reports referred to in paragraph 1 covering a calendar year shall be communicated

to the Commission before 30 April of the following calendar year.

Article 75

Review

1. By [please insert exact date [5] years after entry into force], the Commission shall

review and prepare a general report on this Regulation. This report shall, in

particular, assess the matters referred to in points (a) to (i) of Article 74(1), whether

there are other material barriers to competition in relation to the services covered

by this Regulation which are insufficiently addressed and the potential need for

178

further measures to limit the impact on taxpayers of the failure of CSDs. The

Commission shall submit the report to the European Parliament and the Council,

together with any appropriate proposals.

179

Article 76

Entry into force and application

1. This Regulation shall enter into force on the twentieth day following that of its

publication in the Official Journal of the European Union.

2. Article 5(2) shall apply from 1 January 2015.

By way of exception from the first subparagraph, in case of a trading venue that has

access to a CSD referred to in Article 30(5), Article 5(2) shall apply as follows:

(a) at least six months before such a CSD outsources its activities to the relevant

public entity, and

(b) from 1 January 2016 at the latest.

3. Article 3(1) shall apply from 1 January 2023 to transferable securities issued after

that date and from 1 January 2025 to all transferable securities.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

▌

180

ANNEX

List of Services

Section A

Core services of central securities depositories

1. Initial recording of securities in a book-entry system ('notary service');

2. Providing and maintaining securities accounts at the top tier level ('central

maintenance service');

3. Operating a securities settlement system ('settlement service').

Section B

Non-banking type of ancillary services of central securities depositories that do not entail

credit or liquidity risks

Services provided by the CSDs that contribute to enhancing the safety, efficiency and

transparency of the securities markets, which may include but is not restricted to:

1. Services related to the settlement service, such as:

(a) Organising a securities lending mechanism, as agent among participants of a

securities settlement system;

(b) Providing collateral management services, as agent for participants of a

securities settlement system;

(c) Settlement matching, instruction routing, trade confirmation, trade verification.

181

2. Services related to the notary and central maintenance services, such as:

(a) Services related to shareholders' registers;

(b) Processing of corporate actions, including tax, general meetings and information

services;

(c) New issue services, including allocation and management of ISIN codes and

similar codes;

(d) Instruction routing and processing, fee collection and processing and related

reporting;

3. Establishing CSD links, providing, maintaining or operating securities accounts in

relation to the settlement service, collateral management▌, other ancillary services▌

4. Any other services, such as:

(a) Providing general collateral management services as agent;

(b) Providing regulatory reporting;

(c) Providing information, data and statistics to market/census bureaus or other

governmental or inter-governmental entities;

(d) Providing IT services.

182

Section C

Banking type of ancillary services

▌Banking type of services directly related to core or ancillary services listed in Sections A and

B, such as:

(a) Providing cash accounts to, and accepting ▌deposits from, participants in a securities

settlement system and holders of securities accounts, within the meaning of point 1 of

Annex 1 of Directive .../.../EU [new CRD];

(b) Providing cash credit for reimbursement no later than the following business day,

cash lending to pre-finance corporate actions and lending securities to holders of

securities accounts, within the meaning of point 2 of Annex 1 of Directive .../.../EU

[new CRD]

(c) Payment services involving processing of cash and foreign exchange transactions,

within the meaning of point 4 of Annex 1 of Directive …/…/EU [new CRD];

(d) Guarantees and commitments related to securities lending and borrowing, within the

meaning of point 6 of Annex 1 of Directive .../.../EU [new CRD];

(e) Treasury activities involving foreign exchange and transferable securities related to

managing participants’ long balances, within the meaning of points 7(b) and (e) of

Annex 1 of Directive .../.../EU [new CRD].

183

P7_TA-PROV(2014)0389

Marine equipment ***I

European Parliament legislative resolution of 15 April 2014 on the proposal for a directive of the European Parliament and of the Council on marine equipment and repealing Directive 96/98/EC (COM(2012)0772 – C7-0414/2012 – 2012/0358(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2012)0772),

– having regard to Article 294(2) and Article 100(2) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0414/2012),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to the opinion of the European Economic and Social Committee of 20 March 20131,

– after consulting the Committee of the Regions,

– having regard to the undertaking given by the Council representative by letter of 19 February 2014 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the report of the Committee on Transport and Tourism (A7-0255/2013),

1. Adopts its position at first reading hereinafter set out;

2. Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

1 OJ C 161, 6.6.2013, p. 93.

184

P7_TC1-COD(2012)0358

Position of the European Parliament adopted at first reading on 15 April 2014 with a view to the adoption of Directive 2014/.../EU of the European Parliament and of the Council on marine equipment and repealing Council Directive 96/98/EC

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular

Article 100(2) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee1,

After consulting the Committee of the Regions▌,

Acting in accordance with the ordinary legislative procedure2,

TEXT HAS NOT YET UNDERGONE LEGAL-LINGUISTIC FINALISATION.1 OJ C 161, 6.6.2013, p. 93.2 Position of the European Parliament of 15 April 2014.

185

Whereas:

(1) The global dimension of shipping calls for the Union to apply and support the

international regulatory framework for maritime safety. The international maritime

safety conventions require flag States to ensure that the equipment carried on board

ships complies with certain safety requirements as regards design, construction and

performance, and to issue the relevant certificates. To that end, detailed performance

and testing standards for certain types of marine equipment have been developed by

the International Maritime Organization (IMO) and by the international and European

standardization bodies.

(2) The international instruments leave a significant margin of discretion to the flag

administrations. In the absence of harmonisation, this leads to varying levels of safety

for products which the competent national authorities have certified as complying with

the said conventions and standards; as a result, the smooth functioning of the internal

market is affected as it becomes difficult for the Member States to accept equipment

certified in another Member State to be placed on board ships flying their flags without

further verification.

(3) Harmonisation by the Union resolves these problems. Council Directive 96/98/EC1

thus laid down common rules to eliminate differences in the implementation of

international standards by means of a clearly identified set of requirements and

uniform certification procedures.

1 Council Directive 96/98/EC of 20 December 1996 on marine equipment(OJ L 46, 17.2.1997, p. 25).

186

(4) There are ▌various other instruments of Union law which lay down requirements and

conditions, inter alia in order to ensure the free movement of goods within the internal

market or for environmental purposes, for certain products which are similar in nature

to equipment used on board ships ▌ but which do not meet the international standards

– which may substantially differ from the internal legislation of the Union and are in

constant evolution. Those products cannot therefore be certified by the Member States

in accordance with the relevant international maritime safety conventions. Equipment

to be placed onboard EU ships in accordance with international safety standards should

therefore be regulated exclusively by this Directive, which should in any event be

considered the lex specialis; furthermore, a specific marking should be established to

indicate that ▌ equipment bearing that mark complies with the requirements laid down

in the relevant international conventions and instruments which have entered into

force.

(5) As well as setting out detailed performance and testing standards for marine

equipment, the international instruments sometimes allow for measures that deviate

from the prescriptive requirements but which, under certain conditions, are suitable

to satisfy the intent of those requirements. The International Convention for the

Safety of Life at Sea (SOLAS), 1974, allows for alternative designs and

arrangements which could be applied by individual Member States acting under

their own responsibility.

187

(6) Experience in the implementation of Directive 96/98/EC has shown that it is necessary

to take additional measures in order to enhance the implementation and enforcement

mechanisms of that Directive and simplify the regulatory environment while

guaranteeing that IMO requirements are applied and implemented in a harmonised way

across the Union.

(7) Requirements should therefore be established for marine equipment to meet the safety

standards laid down in the applicable international instruments, including the relevant

testing standards, in order to ensure that equipment which complies with those

requirements can circulate unimpeded within the internal market and be placed on

board ships flying the flag of any Member State.

(8) In order to allow for fair competition in the development of marine equipment, every

effort should be made to promote the use of open standards in order to make them

available freely or at a nominal charge, and permissible to all to copy, distribute and

use for no fee or at a nominal fee.

188

(9) Decision No 768/2008/EC of the European Parliament and of the Council1 lays down

common principles and reference provisions intended to apply across sectoral

legislation in order to provide a coherent basis for revision or recasts of that

legislation. That Decision constitutes a general framework of a horizontal nature for

future legislation harmonising the conditions for the marketing of products and a

reference text for existing legislation. That general framework provides appropriate

solutions to the problems identified in the implementation of Directive 96/98/EC. It is

therefore necessary to incorporate the definitions and reference provisions of Decision

No 768/2008/EC into this Directive by making the adaptations which are required by

the specific features of the marine equipment sector.

(10) In order to provide market surveillance authorities with additional, specific means to

facilitate their task, an electronic tag could supplement or replace the wheel mark in

due time.

(11) The responsibilities of the economic operators should be laid down in a way which is

proportionate and non-discriminatory for those economic operators who are

established within the Union, taking into account the fact that a significant

proportion of the marine equipment falling under the scope of this Directive may

never be imported and distributed in the territory of the Member States.

1 Decision No 768/2008/EC of the European Parliament and of the Council of 9 July 2008 on a common framework for the marketing of products, and repealing Council Decision 93/465/EEC (OJ L 218, 13.8.2008, p. 82).

189

(12) Given that marine equipment is placed on board ships at the time of their

construction or repair all over the world, market surveillance becomes particularly

difficult and cannot be effectively supported by border controls. Therefore, the

respective obligations of Member States and of economic operators within the Union

should be clearly specified. Member States should ensure that only compliant

equipment is installed on board ships flying their flags and that this obligation is

fulfilled through issuance, endorsement or renewal of the certificates of such ships

by the flag State administration under the international conventions, as well as

through national market surveillance arrangements in place in accordance with the

Union market surveillance framework laid down in Chapter III of Regulation (EC)

No 765/2008 of the European Parliament and of the Council1. Member States

should be supported in carrying out those obligations by the information systems

made available by the Commission for the assessment, notification and monitoring

of bodies authorised to carry out conformity assessment tasks, the sharing of

information in relation to approved marine equipment, applications withdrawn or

refused, and non-compliance of equipment.

1 Regulation (EC) No 765/2008 of the European Parliament and of the Council of 9 July 2008 setting out the requirements for accreditation and market surveillance relating to the marketing of products (OJ L 218, 13.8.2008, p. 30).

190

(13) In the first instance, the affixing of the wheel mark to the marine equipment by the

manufacturer or, where relevant, the importer should be the guarantee pursuant to

their obligations under this Directive that the equipment is compliant and may be

placed on the market with a view to being placed on board an EU ship. Thereafter,

certain provisions are necessary for the safe continuation and applicability of the

wheel mark after it has been affixed and for the effective discharge of the task of

national market surveillance authorities. The manufacturer or, where relevant, the

importer or the distributer, is obliged to provide the competent authorities with full

and truthful information in relation to the equipment it has wheel marked to ensure

that marine equipment remains safe. The manufacturer is obliged to cooperate with

market surveillance authorities including as regard standards against which it has

manufactured and certified equipment, it shall also exercise due diligence in relation

to marine equipment it places on the market. In this regard, a manufacturer located

outside the Union should appoint an authorised representative in order to ensure

cooperation with competent national authorities.

191

(14) Compliance with international testing standards could best be demonstrated by means

of conformity-assessment procedures such as those laid down in Decision No

768/2008/EC. However, only those conformity-assessment procedures which meet the

requirements of the international instruments should be made available to

manufacturers.

(15) In order to ensure a fair and efficient procedure when examining suspected

non-compliance, the Member States should be encouraged to take all measures

conducive to an exhaustive and objective evaluation of the risks; if the Commission is

satisfied that this condition has been met, it should not be obliged to repeat that

evaluation when reviewing the restrictive measures adopted by the Member States as

regards non-compliant equipment.

(16) When performing its investigative duties with regard to notified bodies, the

Commission should keep Member States informed and cooperate with them as far as

possible, taking due account of the Commission's independent role.

(17) When the surveillance authorities of a Member State consider that marine

equipment covered by this Directive is liable to present a risk to maritime safety, to

health or to the environment, they should carry out evaluations or tests in relation to

the equipment concerned. In cases where a risk is detected, the Member State should

call upon the economic operator concerned to take the appropriate corrective action,

or even to withdraw or recall the equipment concerned.

192

(18) The use of marine equipment not bearing the wheel mark ▌ may be allowed in

exceptional circumstances, especially when it is not possible for a ship to obtain

equipment bearing the wheel mark in a port or installation outside the Union or when

equipment bearing the wheel mark is not available in the market.

(19) It is necessary to ensure that the attainment of the objectives of this Directive is not

impaired by the absence of international standards or serious weaknesses or

anomalies in existing standards, including testing standards, for specific items of

marine equipment falling within the scope of this Directive. It is also necessary to

identify the specific items of marine equipment which could benefit from electronic

tagging. Moreover, it is necessary to keep up-to-date a ▌ non-essential element of this

Directive, namely the ▌references to ▌standards as referred to in Annex III, when

new standards become available. The power to adopt acts in accordance with Article

290 of the Treaty on the Functioning of the European Union should therefore be

delegated to the Commission in respect of the adoption, under certain conditions and

on an interim basis, of harmonised technical specifications and testing standards and in

order to amend the said ▌ references. It is of particular importance that the

Commission carry out appropriate consultations during its preparatory work, including

at expert level. ▌ The Commission, when preparing and drawing ▌ up delegated acts,

should ensure a simultaneous, timely and appropriate transmission of relevant

documents to the European Parliament and to the Council.

193

(20) In order to meet the objectives of this Directive, the international instruments should

be uniformly implemented in the internal market. It is therefore necessary, for each

item of marine equipment for which the approval of the flag State is required by the

international conventions, to identify in a clear and timely way the design, construction

and performance requirements as well as the associated testing standards laid down in

the international instruments for that equipment, and to adopt common criteria and

procedures, including timeframes, for the implementation of those requirements and

standards by notified bodies, Member State authorities and ▌ economic operators,

including any operator responsible for placing equipment on board an EU ship. It is

also necessary to ensure that the attainment of the objectives of this Directive is not

impaired by shortcomings in the applicable technical specifications and testing

standards or in cases where the IMO has failed to produce appropriate standards for

marine equipment falling under the scope of this Directive.

(21) The international instruments, with the exception of testing standards, should

automatically apply in their up-to-date version. In order to mitigate the risk that the

introduction of new testing standards into Union legislation causes disproportionate

difficulties for the Union fleet and for economic operators, from the standpoint of

clarity and legal certainty, the entry into force of such new testing standards should

not be automatic but, rather, should be explicitly indicated by the Commission.

194

(22) In order to ensure uniform conditions for the implementation of this Directive,

implementing powers should be conferred on the Commission. Those powers should

be exercised in accordance with Regulation (EU) No 182/2011 of the European

Parliament and of the Council ▌1.

(23) In order to facilitate a harmonised, rapid and simple implementation of this

Directive, implementing acts adopted pursuant to this Directive should take the form

of Commission regulations.

(24) In line with established practice, the committee referred to in this Directive can play

a useful role in examining matters concerning the application of this Directive

raised either by its chair or by a representative of a Member State in accordance

with its rules of procedure.

(25) When matters relating to this Directive, other than its implementation or

infringements, are being examined, i.e. in a Commission expert group, the European

Parliament should in line with existing practice receive full information and

documentation and, where appropriate, an invitation to attend such meetings.

1 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).

195

(26) The Commission is assisted by the European Maritime Safety Agency, in accordance

with Regulation (EC) No 1406/2002 of the European Parliament and of the Council1,

in the effective implementation of relevant binding legal acts of the Union and in the

performance of the tasks therein entrusted to the Commission.

(27) The competent authorities and all economic operators should make all possible

efforts to facilitate written communication in accordance with international practice,

with a view to finding common means of communication.

(28) Since the objectives of this Directive, namely to enhance safety at sea and the

prevention of marine pollution through the uniform application of the relevant

international instruments relating to equipment to be placed on board ships, and to

ensure the free movement of such equipment within the Union, cannot be sufficiently

achieved by the Member States but can rather, by reason of the scale of the action, be

better achieved at Union level, the Union may adopt measures, in accordance with the

principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In

accordance with the principle of proportionality, as set out in that article, this Directive

does not go beyond what is necessary in order to achieve those objectives.

(29) The measures to be adopted represent a major modification of the provisions of

Directive 96/98/EC and therefore, in the interests of clarity, that Directive should be

repealed and replaced by this Directive,

HAVE ADOPTED THIS DIRECTIVE:

1 Regulation (EC) No 1406/2002 of the European Parliament and of the Council of 27 June 2002 establishing a European Maritime Safety Agency (OJ L 208, 5.8.2002, p. 1). Regulation as last amended by Regulation (EU) No 100/2013 (OJ L 39, 9.2.2013, p. 30).

196

Chapter 1

General provisions

Article 1

Objective

The purpose of this Directive is to enhance safety at sea and to prevent marine pollution

through the uniform application of the relevant international instruments relating to marine

equipment to be placed on board EU ships, and to ensure the free movement of such equipment

within the Union.

Article 2

Definitions

For the purposes of this Directive, the following definitions apply:

(1) "marine equipment" means equipment falling under the scope of this Directive in

accordance with Article 3;

(2) "EU ship" means a ship flying the flag of a Member State and falling under the scope

of the international conventions ▌;

197

(3) "international conventions" means the following conventions, together with their

protocols and codes of mandatory application, adopted under the auspices of the

International Maritime Organization (IMO), which have entered into force and which

lay down specific requirements for the approval by the flag State of equipment to be

placed on board ships ▌:

▌

– the 1972 Convention on the International Regulations for Preventing Collisions

at Sea (Colreg),

– the 1973 International Convention for the Prevention of Pollution from Ships

(Marpol),

– the 1974 International Convention for the Safety of Life at Sea (Solas);

▌

(4) "testing standards" means the testing standards for marine equipment set by:

– the International Maritime Organization (IMO),

– the International Organization for Standardization (ISO),

198

– the International Electrotechnical Commission (IEC),

– the European Committee for Standardization (CEN),

– the European Committee for Electrotechnical Standardization (Cenelec),

– the International Telecommunication Union (ITU),

– the European Telecommunications Standards Institute (ETSI),

– the Commission, in accordance with Article 8 and Article 27(6) of this

Directive,

– the regulatory authorities recognised in the mutual recognition agreements to

which the Union is a party;

(5) "international instruments" means the international conventions, together with the

resolutions and circulars of the IMO giving effect to those conventions in their up-to-

date version, and the testing standards;

(6) "wheel mark" means the symbol referred to in Article 9 and set out in Annex I or, as

appropriate, the electronic tag referred to in Article 11;

199

(7) "notified body" means an organisation designated by the competent national

administration of a Member State in accordance with Article 17;

(8) "making available on the market" means any supply of marine equipment on the Union

market in the course of a commercial activity, whether in return for payment or free

of charge;

(9) "placing on the market" means the first making available of marine equipment on the

Union market;

(10) "manufacturer" means any natural or legal person who manufactures marine

equipment or has marine equipment designed or manufactured, and markets that

equipment under his name or trademark;

(11) "authorised representative" means any natural or legal person established within the

Union who has received a written mandate from a manufacturer to act on his behalf in

relation to specified tasks;

(12) "importer" means any natural or legal person established within the Union who places

marine equipment from a third country on the Union market;

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(13) "distributor" means any natural or legal person in the supply chain, other than the

manufacturer or the importer, who makes marine equipment available on the market;

(14) "economic operators" means the manufacturer, the authorised representative, the

importer and the distributor;

(15) "accreditation" means accreditation as defined in point 10 of Article 2 ▌ of

Regulation (EC) No 765/2008 ▌;

(16) "national accreditation body" means national accreditation body as defined in point 11

of Article 2 ▌ of Regulation (EC) No 765/2008;

(17) ‘conformity assessment ▌’ means the process carried out by the notified bodies, in

accordance with Article 15, demonstrating whether marine equipment complies with

the requirements laid down in this Directive ▌;

(18) "conformity assessment body" means a body that performs conformity assessment

activities including calibration, testing, certification and inspection;

(19) "recall" means any measure aimed at achieving the return of marine equipment that has

already been placed on board EU ships or purchased with the intention of being

placed on board EU ships;

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(20) "withdrawal" means any measure aimed at preventing marine equipment in the supply

chain from being made available on the market;

(21) "EU declaration of conformity" means a statement issued by the manufacturer in

accordance with Article 16;

(22) "product" means an item of marine equipment.

Article 3

Scope

1. This Directive shall apply to equipment placed or to be placed on board an EU ship

and for which the approval of the flag State administration is required by the

international instruments, regardless of whether the ship is located in the Union at

the time when it is fitted with the equipment.

2. Notwithstanding the fact that the marine equipment referred to in paragraph 1 may also

fall within the scope of instruments of Union law other than this Directive, that marine

equipment shall, for the purpose set out in Article 1, be subject only to this Directive.

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Article 4

Requirements for marine equipment

1. Marine equipment that is placed on board an EU ship on or after the date referred to in

the second subparagraph of Article 39(1) shall meet the design, construction and

performance requirements of the international instruments as applicable at the time the

said equipment is placed on board.

2. Compliance of marine equipment with the requirements referred to in paragraph 1

shall be demonstrated solely in accordance with the testing standards and by means of

the conformity-assessment procedures referred to in Article 15.

3. The international instruments shall apply, without prejudice to the conformity

checking procedure set out in Article 5 of Regulation (EC) No 2099/2002 of the

European Parliament and of the Council1.

4. The requirements and standards referred to in paragraphs 1 and 2 shall be implemented

in a uniform manner, in accordance with Article 35(2) ▌.

1 Regulation (EC) No 2099/2002 of the European Parliament and of the Council of 5 November 2002 establishing a Committee on Safe Seas and the Prevention of Pollution from Ships (COSS), OJ L 324, 29.11.2002, p.1.

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Article 5

Application

1. When Member States issue, endorse or renew the certificates of the ships flying their

flag as required by the international conventions, they shall ensure that the marine

equipment on board those ships complies with the requirements of this Directive.

2. Member States shall take the necessary measures to ensure that marine equipment on

board ships flying their flag complies with the requirements in the international

instruments which are applicable to equipment already placed on board. Implementing

powers shall be conferred upon the Commission to ensure the uniform application

of those measures, in accordance with Article 35(3).

Article 6

Functioning of the internal market

Member States shall not prohibit the placing on the market or the placing on board an EU ship

of marine equipment which complies with this Directive, nor refuse to issue the certificates

relating thereto to the ships flying their flag, or to renew the said certificates.

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Article 7

Transfer of a ship to the flag of a Member State

1. In the case of a non-EU ship which ▌ is to be transferred to the flag of a Member

State, that ship shall, during transfer, be subject to inspection by the receiving Member

State to verify that the actual condition of its marine equipment corresponds to its

safety certificates and either complies with this Directive and bears the wheel mark or

is equivalent, to the satisfaction of that Member State's administration, to marine

equipment certified in accordance with this Directive as of ….

2. In cases where the date of installation on board of marine equipment cannot be

established, Member States may determine satisfactory requirements of equivalence,

taking into account relevant international instruments.

3. Unless the equipment either bears the wheel mark or the administration considers it to

be equivalent, it shall be replaced.

4. Marine equipment which is considered equivalent pursuant to this Article shall be

issued with a certificate by the Member State which shall at all times be carried with

the equipment. That certificate shall give the flag Member State’s permission for the

equipment to be retained on board the ship and impose any restrictions or lay down

any provisions relating to the use of the equipment.

OJ: Please insert date: 24 months after the date of entry into force of this Directive.

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Article 8

Standards for marine equipment

1. Without prejudice to Directive 98/34/EC of the European Parliament and the Council1,

as amended by Regulation (EU) No 1025/2012 of the European Parliament and of

the Council2, the Union shall pursue the development by the IMO and by

standardisation bodies of appropriate international standards, including detailed

technical specifications and testing standards, for marine equipment whose use or

installation on board ships is deemed necessary to enhance maritime safety and the

prevention of marine pollution. The Commission shall monitor such development on a

regular basis.

2. In the absence of an international standard for a specific item of marine equipment, in

exceptional circumstances where duly justified by an appropriate analysis and in

order to remove a serious and unacceptable threat to maritime safety, to health or to

the environment and taking into account any ongoing work at IMO level, the

Commission shall be empowered to adopt, by means of delegated acts in accordance

with Article 37, harmonised technical specifications and testing standards for that

specific item of marine equipment ▌.

1 Directive 98/34/EC of the European Parliament and the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations (OJ L 204, 21.7.1998, p. 37).

2 Regulation (EU) No 1025/2012 of the European Parliament and of the Council of 25 October 2012 on European standardisation, amending Council Directives 89/686/EEC and 93/15/EEC and Directives 94/9/EC, 94/25/EC, 95/16/EC, 97/23/EC, 98/34/EC, 2004/22/EC, 2007/23/EC, 2009/23/EC and 2009/105/EC of the European Parliament and of the Council and repealing Council Decision 87/95/EEC and Decision No 1673/2006/EC of the European Parliament and of the Council(OJ L 316, 14.11.2012, p. 12).

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It is of particular importance that the Commission carry out consultations with

experts, including Member States' experts, during the preparation of such delegated

acts.

Those technical specifications and testing standards shall apply on an interim basis

▌until such time as the IMO has adopted a standard for that specific item of marine

equipment.

3. In exceptional circumstances where duly justified by an appropriate analysis and if

it is necessary to remove an identified unacceptable threat to maritime safety, to

health or to the environment due to a serious weakness or anomaly in an existing

standard for a specific item of marine equipment indicated by the Commission

pursuant to Article 35(2) or (3) and taking into account any ongoing work at IMO

level, the Commission shall be empowered to adopt, by means of delegated acts in

accordance with Article 37, harmonised technical specifications and testing

standards for that specific item of marine equipment, to the extent necessary to

remedy the serious weakness or anomaly only.

It is of particular importance that the Commission carry out consultations with

experts, including Member States' experts, during the preparation of such delegated

acts.

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Those technical specifications and testing standards shall apply on an interim basis

until such time as the IMO has reviewed the standard applicable to that specific item

of marine equipment.

4. The technical specifications and standards adopted in accordance with paragraphs 2

and 3 shall be made accessible free of charge by the Commission.

Chapter 2

The wheel mark

Article 9

The wheel mark

1. Marine equipment whose compliance with the requirements laid down in this Directive

has been demonstrated in accordance with the relevant conformity-assessment

procedures shall have the wheel mark affixed to it.

2. The wheel mark shall not be affixed to any other product.

3. The form of the wheel mark to be used shall be as set out in Annex I.

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4. Use of the wheel mark shall be subject to the general principles set out in paragraphs 1

and 3 to 6 of Article 30 of Regulation (EC) No 765/2008, where any reference to the

CE marking shall be construed as a reference to the wheel mark.

Article 10

Rules and conditions for affixing the wheel mark

1. The wheel mark shall be affixed visibly, legibly and indelibly to the product or to its

data plate and, where relevant, embedded in its software. Where that is not possible or

not warranted on account of the nature of the product, it shall be affixed to the

packaging and to the accompanying documents.

2. The wheel mark shall be affixed at the end of the production phase.

3. The wheel mark shall be followed by the identification number of the notified body,

where that body is involved in the production control phase, and by ▌ the year in

which the mark is affixed.

4. The identification number of the notified body shall be affixed by the body itself or,

under its instructions, by the manufacturer or his authorised representative.

▌

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Article 11

Electronic tag

1. In order to facilitate market surveillance and prevent the counterfeiting of specific

items of marine equipment referred to in paragraph 3, manufacturers may use an

appropriate and reliable form of electronic tag instead of, or in addition to, the wheel

mark. In such a case, Articles 9 and 10 shall apply, as appropriate, mutatis mutandis.

2. The Commission shall carry out a cost-benefit analysis concerning the use of the

electronic tag as a supplement or a replacement of the wheel mark.

3. The Commission may adopt delegated acts, in accordance with Article 37, in order to

identify the specific items of marine equipment which can benefit from electronic

tagging. It is of particular importance that the Commission carry out consultations

with experts, including Member States' experts, during the preparation of such

delegated acts.

4. Implementing powers shall be conferred upon the Commission in order to lay down

appropriate technical criteria as regards the design, performance, affixing and use of

electronic tags in the form of Commission Regulations and in accordance with the

examination procedure referred to in Article 38(2).

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5. For the equipment identified in accordance with paragraph 3, the wheel mark may,

within three years after the date of adoption of the appropriate technical criteria

referred to in paragraph 4, be supplemented by an appropriate and reliable form of

electronic tag.

6. For the equipment identified in accordance with paragraph 3, the wheel mark may

be replaced, five years after the date of adoption of the appropriate technical criteria

referred to in paragraph 4, by an appropriate and reliable form of electronic tag.

Chapter 3

Obligations of economic operators

Article 12

Obligations of manufacturers

1. By affixing the wheel mark, manufacturers shall take on responsibility for

guaranteeing that the marine equipment to which the mark is affixed has been designed

and manufactured in accordance with the technical specifications and standards

implemented in accordance with Article 35(2) and shall assume the obligations laid

down in paragraphs 2 to 9 of this Article.

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2. Manufacturers shall draw up the required technical documentation and have the

applicable conformity assessment procedures carried out.

3. Where compliance of marine equipment with the applicable requirements has been

demonstrated by the conformity assessment procedure, manufacturers shall draw up an

EU declaration of conformity in accordance with Article 16 and affix the wheel mark

in accordance with Articles 9 and 10.

4. Manufacturers shall keep the technical documentation and the EU declaration of

conformity referred to in Article 16 for at least 10 years after the wheel mark has

been affixed and in no case less than the expected life of the marine equipment

concerned.

5. Manufacturers shall ensure that procedures are in place for series production to remain

in conformity. Changes in marine equipment design or characteristics and changes in

the requirements in the international instruments as referred to in Article 4, on the

basis of which conformity of marine equipment is declared, shall be ▌ taken into

account. When necessary in accordance with Annex II, manufacturers shall have a

new conformity assessment carried out.

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6. Manufacturers shall ensure that their products bear a type, batch or serial number or

other element allowing their identification, or, where the size or nature of the product

does not allow it, that the required information is provided on the packaging or in a

document accompanying the product or both, as appropriate.

7. Manufacturers shall indicate their name, registered trade name or registered trade mark

and the address at which they can be contacted on the product or, where that is not

possible, on its packaging or in a document accompanying the product or both, as

appropriate. The address must indicate a single point at which the manufacturer can be

contacted.

8. Manufacturers shall ensure that the product is accompanied by instructions and all

necessary information for safe installation on board and safe use of the product,

including limitations of use, if any, that can be easily understood by the ▌users,

together with any other documentation required by the international instruments or

testing standards.

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9. Manufacturers who consider or have reason to believe that a product to which they

have affixed the wheel mark is not in conformity with the applicable design,

construction and performance requirements and the testing standards implemented

in accordance with Article 35(2) and (3), shall immediately take the necessary

corrective measures to bring that product into conformity, to withdraw it or recall it, if

appropriate. In addition, where the product presents a risk, manufacturers shall

immediately inform the competent national authorities of the Member States, giving

details, in particular, of the non-compliance and of any corrective measures taken.

10. Manufacturers shall, further to a reasoned request from a competent ▌ authority,

promptly provide it with all the information and documentation necessary to

demonstrate the conformity of the product, in a language which can be easily

understood by or is acceptable to that authority, and grant to that authority access to

their premises for market surveillance purposes in accordance with Article 19 of

Regulation (EC) No 765/2008 and provide samples or access to samples in

accordance with Article 25(4) of this Directive. They shall cooperate with that

authority, at its request, on any action taken to eliminate the risks posed by products

which they have placed on the market.

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Article 13

Authorised representatives

1. A manufacturer who is not located in the territory of at least one Member State shall,

by a written mandate, appoint an authorised representative for the Union and shall

indicate in the mandate the name of the authorised representative and the address at

which he can be contacted.

2. The obligations laid down in Article 12(1) and the drawing up of technical

documentation shall not form part of the authorised representative's mandate.

3. An authorised representative shall perform the tasks specified in the mandate received

from the manufacturer. The mandate shall allow the authorised representative to do at

least the following:

(a) keep the EU declaration of conformity and the technical documentation at the

disposal of national surveillance authorities for at least 10 years after the wheel

mark has been affixed and in no case less than the expected life of the marine

equipment concerned;

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(b) further to a reasoned request from a competent ▌ authority, provide that

authority with all the information and documentation necessary to demonstrate

the conformity of a product;

(c) cooperate with the competent ▌ authorities, at their request, on any action taken

to eliminate the risks posed by products covered by his mandate.

Article 14

Other economic operators

1. Importers shall indicate their name, registered trade name or registered trade mark and

the address at which they can be contacted on the product or, where that is not

possible, on its packaging or in a document accompanying the product or both, as

appropriate.

2. Importers and distributors shall, further to a reasoned request from a competent ▌

authority, provide it with all the information and documentation necessary to

demonstrate the conformity of a product in a language which can be easily understood

by or is acceptable to that authority. They shall cooperate with that authority, at its

request, on any action taken to eliminate the risks posed by products which they have

placed on the market.

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3. An importer or distributor shall be considered a manufacturer for the purposes of this

Directive and ▌ shall be subject to the obligations of the manufacturer under Article

12, where he places marine equipment on the market or on board an EU ship under his

name or trademark or modifies marine equipment already placed on the market in such

a way that compliance with the applicable requirements may be affected.

4. For a period of at least 10 years after the wheel mark has been affixed and in no

case less than the expected life of the marine equipment concerned, economic

operators shall, on request, identify the following to the market surveillance

authorities:

(a) any economic operator who has supplied them with a product;

(b) any economic operator to whom they have supplied a product.

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Chapter 4

Conformity assessment and notification of conformity assessment

bodies

Article 15

Conformity assessment procedures

1. The conformity assessment procedures shall be as set out in Annex II.

2. Member States shall ensure that the manufacturer or his authorized representative has

the conformity assessment carried out, through a notified body, for a specific item of

marine equipment, by using one of the options provided by means of implementing

acts adopted by the Commission in accordance with the examination procedure

referred to in Article 38(2), from among one of the following procedures:

(a) where the EC type-examination (module B) is to be used, before being placed on

the market, all marine equipment shall be subject to:

– production-quality assurance (module D); or

– product-quality assurance (module E); or

– product verification (module F);

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(b) where sets of marine equipment are produced individually or in small quantities

and not in series or in mass, the conformity- assessment procedure may be the

EC unit verification (module G).

3. The Commission shall, by means of the information system made available for that

purpose, keep an up-to-date list of approved marine equipment and applications

withdrawn or refused and shall make it available to interested parties.

Article 16

EU declaration of conformity

1. The EU declaration of conformity shall state that the fulfilment of the requirements

laid down in accordance with Article 4 has been demonstrated.

2. The EU declaration of conformity shall follow the model structure set out in Annex III

to Decision No 768/2008/EC. It shall contain the elements specified in the relevant

modules set out in Annex II to this Directive and shall be kept up to date.

3. By drawing up the EU declaration of conformity, the manufacturer shall assume the

responsibility and undertake the obligations referred to in Article 12(1).

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4. When marine equipment is placed on board an EU ship, a copy of the EU declaration

of conformity covering the equipment concerned shall be provided to the ship, and

shall be kept on board until the said equipment is removed from the ship. It shall be

translated by the manufacturer into the language or languages required by the flag

Member State, including at least a language commonly used in the maritime

transport sector.

5. A copy of the EU declaration of conformity shall be provided to the notified body or to

the bodies which carried out the relevant conformity-assessment procedures.

Article 17

Notification of conformity assessment bodies

1. Member States shall, by means of the information system made available by the

Commission for that purpose, notify the Commission and the other Member States of

bodies authorised to carry out ▌ conformity assessment tasks under this Directive.

2. Notified bodies shall comply with the requirements laid down in Annex III.

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Article 18

Notifying authorities

1. Member States shall designate a notifying authority that shall be responsible for setting

up and carrying out the necessary procedures for the assessment and notification of

conformity assessment bodies and the monitoring of notified bodies, including

compliance with ▌ Article 20.

2. Notified bodies shall be monitored at least every two years. The Commission may

choose to participate as an observer in the monitoring exercise.

3. Member States may decide that the assessment and monitoring referred to in paragraph

1 are to be carried out by a national accreditation body.

4. Where the notifying authority delegates or otherwise entrusts the assessment,

notification or monitoring referred to in paragraph 1 to a body which is not a

governmental entity, that body shall be a legal entity and shall comply mutatis

mutandis with the requirements laid down in Annex V. In addition it shall have

arrangements to cover liabilities arising out of its activities.

5. The notifying authority shall take full responsibility for the tasks performed by the

body referred to in paragraph 4.

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6. The notifying authority shall comply with the requirements laid down in Annex V.

Article 19

Information obligation on notifying authorities

1. Member States shall inform the Commission of their procedures for the assessment

and notification of conformity assessment bodies and the monitoring of such bodies,

and of any changes thereto.

2. The Commission shall, by means of the information system made available for that

purpose, make that information publicly available.

Article 20

Subsidiaries of and subcontracting by notified bodies

1. Where a notified body subcontracts specific tasks connected with conformity

assessment or has recourse to a subsidiary, it shall ensure that the subcontractor or the

subsidiary meets the requirements set out in Annex III and shall inform the notifying

authority accordingly.

2. Notified bodies shall take full responsibility for the tasks performed by subcontractors

or subsidiaries wherever these are established.

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3. Activities may be subcontracted or carried out by a subsidiary only with the agreement

of the client.

4. Notified bodies shall keep at the disposal of the notifying authority the relevant

documents concerning the assessment of the qualifications of the subcontractor or the

subsidiary and the work carried out by them under this Directive.

Article 21

Changes to notifications

1. Where a notifying authority has ascertained or has been informed that a notified body

no longer meets the requirements laid down in Annex III , or that it is failing to fulfil

its obligations, the notifying authority shall restrict, suspend or withdraw notification

as appropriate, depending on the seriousness of the failure to meet those requirements

or fulfil those obligations. It shall, by means of the information system made

available by the Commission for that purpose, immediately inform the Commission

and the other Member States accordingly.

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2. In the event of restriction, suspension or withdrawal of notification, or where the

notified body has ceased its activity, the notifying Member State shall take appropriate

steps to ensure that the files of that body are either processed by another notified body

or kept available for the responsible notifying and market surveillance authorities at

their request.

Article 22

Challenge of the competence of notified bodies

1. The Commission shall investigate all cases where it doubts, based on the information

available to it or brought to its attention, the competence of a notified body or the

continued fulfilment by a notified body of the requirements and responsibilities to

which it is subject.

2. The notifying Member State shall provide the Commission, on request, with all

information relating to the basis for the notification or the maintenance of the

competence of the body concerned.

3. The Commission shall ensure that all sensitive information obtained in the course of its

investigations is treated confidentially.

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4. Where the Commission ascertains that a notified body does not meet or no longer

meets the requirements for its notification, it shall without delay inform the notifying

Member State accordingly and request it to take the necessary corrective measures

without delay, including de-notification if necessary.

Article 23

Operational obligations of notified bodies

1. Notified bodies shall carry out conformity assessments or have them carried out in

accordance with the procedures provided for in Article 15.

2. Where a notified body finds that the obligations laid down in ▌Article 12 have not

been met by a manufacturer, it shall require that manufacturer to take appropriate

corrective measures without delay and shall not issue a conformity certificate.

3. Where, in the course of the monitoring of conformity following the issue of a

certificate, a notified body finds that a product no longer complies, it shall require the

manufacturer to take appropriate corrective measures without delay and shall suspend

or withdraw the certificate if necessary. Where corrective measures are not taken or do

not have the required effect, the notified body shall restrict, suspend or withdraw the

certificate, as appropriate.

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Article 24

Information obligation on notified bodies

1. Notified bodies shall inform the notifying authority of the following:

(a) any refusal, restriction, suspension or withdrawal of a certificate;

(b) any circumstances affecting the scope of and conditions for notification;

(c) any request for information which they have received from market surveillance

authorities regarding conformity assessment activities;

(d) on request, conformity assessment activities performed within the scope of their

notification and any other activity performed, including cross-border activities

and subcontracting.

2. Notified bodies shall provide the Commission and the Member States, on request, with

relevant information on issues relating to negative and positive conformity assessment

results. Notified bodies shall provide the other notified bodies carrying out conformity

assessment activities covering the same products with information concerning negative

and, on request, positive conformity assessment results.

▌

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Chapter 5

Union market surveillance, control of products, safeguard provisions

Article 25

EU market surveillance framework

1. As regards marine equipment, the Member States shall undertake market surveillance

in accordance with the EU market surveillance framework laid down in Chapter III of

Regulation (EC) No 765/2008, subject to ▌ paragraphs 2 and 3 of this Article.

2. National market surveillance infrastructures and programmes shall take into account

the specific features of the marine equipment sector, including the various procedures

carried out as part of the conformity assessment, and in particular the responsibilities

placed on the flag State administration by the international conventions.

3. Market surveillance may include documentary checks as well as checks of marine

equipment which bears the wheel mark whether or not it has been placed on board

ships. Checks of marine equipment already placed on board shall be limited to such

examination as can be carried out while the equipment concerned remains fully

functional on board. ▌

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4. Where the market surveillance authorities of a Member State, as defined in

Regulation (EC) No 765/2008, intend to carry out sample checks ▌ they may, when

reasonable and practicable, request the manufacturer to make the necessary samples

available or to give on-the-spot access to the samples at the manufacturer's own cost.

Article 26

Procedure for dealing with marine equipment presenting a risk at national level

1. Where the market surveillance authorities of one Member State ▌ have sufficient

reason to believe that marine equipment covered by this Directive presents a risk to

maritime safety, to health or to ▌ the environment, they shall carry out an evaluation

in relation to the marine equipment concerned covering all the requirements laid down

in this Directive. The relevant economic operators shall cooperate as necessary with

the market surveillance authorities.

Where, in the course of that evaluation, the market surveillance authorities find that the

marine equipment does not comply with the requirements laid down in this Directive,

they shall without delay require the relevant economic operator to take all appropriate

corrective actions to bring the marine equipment into compliance with those

requirements, to withdraw the marine equipment from the market, or to recall it within

such reasonable period, commensurate with the nature of the risk, as they may

prescribe.

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The market surveillance authorities shall inform the relevant notified body

accordingly.

Article 21 of Regulation (EC) No 765/2008 shall apply to the measures referred to in

the second subparagraph of this paragraph.

2. Where the market surveillance authorities consider that non-compliance is not

restricted to their national territory or to ships flying their flag, they shall inform the

Commission and the other Member States, by means of the information system made

available by the Commission for market surveillance purposes, of the results of the

evaluation carried out under paragraph 1 and of the actions which they have required

the economic operator to take.

3. The economic operator shall ensure that all appropriate corrective action is taken in

respect of all the products concerned that it has made available on the market

throughout the Union or, as necessary, placed or delivered to be placed on board EU

ships.

4. Where the relevant economic operator does not take adequate corrective action within

the period prescribed by the market surveillance authorities in accordance with the

second subparagraph of paragraph 1, or otherwise fails to meet its obligations under

this Directive, the market surveillance authorities shall take all appropriate provisional

measures to prohibit or restrict the marine equipment being made available on their

national market or placed on board the ships flying their flag, to withdraw the product

from that market or to recall it.

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The market surveillance authorities shall inform the Commission and the other

Member States, without delay, of those measures.

5. The information on the measures taken by the market surveillance authorities

referred to in paragraph 4 shall include all available details, in particular the data

necessary for the identification of the non ▌ compliant marine equipment, the origin of

the product, the nature of the non ▌ compliance alleged and the risk involved, the

nature and duration of the national measures taken and the arguments put forward by

the ▌economic operator concerned. In particular, the market surveillance authorities

shall indicate whether the non ▌ compliance is due to either:

(a) failure of the marine equipment to comply with the applicable design,

construction and performance requirements as laid down pursuant to Article 4;

(b) non-compliance with the testing standards referred to in Article 4 during the

conformity-assessment procedure;

(c) shortcomings in the said testing standards.

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6. Member States other than the Member State initiating the procedure shall without

delay inform the Commission and the other Member States of any measures adopted

and of any additional information at their disposal relating to the non-compliance of

the marine equipment concerned, and, in the event of disagreement with the notified

national measure, of their objections.

7. Where, within four months of receipt of the information on the measures taken by the

market surveillance authorities referred to in paragraph 4, no objection has been

raised by a Member State or by the Commission in respect of a provisional measure

taken by a Member State, that measure shall be deemed justified.

8. Member States shall ensure that appropriate restrictive measures ▌ in respect of the

marine equipment concerned, such as withdrawal of the product from their market, are

taken without delay.

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Article 27

EU safeguard procedure

1. Where, on completion of the procedure set out in Article 26(3) and (4), objections are

raised against a measure taken by a Member State, or where the Commission considers

that a national measure may be contrary to Union legislation, the Commission shall

without delay enter into consultation with the Member States and the relevant

economic operator or operators and shall evaluate the national measure. On the basis

of the results of that evaluation, the Commission shall decide whether the national

measure is justified or not.

2. For the purpose of paragraph 1, where the Commission is satisfied that the procedure

followed in the adoption of the national measure is appropriate for an exhaustive and

objective evaluation of the risk and complies with the provisions laid down in Article

21 of Regulation (EC) No 765/2008, it may limit itself to examining the

appropriateness and proportionality of the national measure in relation to the said risk.

3. The Commission shall address its decision to all Member States and shall immediately

communicate it to them and the relevant economic operator or operators.

4. If the national measure is considered justified, all Member States shall take the

measures necessary to ensure that the non-compliant marine equipment is withdrawn

from their market, and, where necessary, recalled. They shall inform the Commission

accordingly.

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5. If the national measure is considered unjustified, the Member State concerned shall

withdraw the measure.

6. Where the ▌non-compliance of the marine equipment is attributed to shortcomings in

the testing standards referred to in Article 4, the Commission may, in order to fulfil

the objective of this Directive, confirm, modify or revoke a national safeguard

measure by means of implementing acts in accordance with the examination

procedure referred to in Article 38(2).

The Commission shall furthermore be empowered to adopt, by means of delegated acts

in accordance with the procedure referred to in Article 37, interim harmonised

requirements and testing standards for that specific item of marine equipment. The

criteria laid down in Article 8(3) shall apply accordingly. These requirements and

testing standards shall be made accessible free of charge by the Commission.

7. Where the testing standard concerned is a European Standard, the Commission shall

inform the relevant European standardisation body or bodies and shall bring the matter

before the Committee set up by Article 5 of Directive 98/34/EC. That Committee shall

consult the relevant European standardisation body or bodies and deliver its opinion

without delay.

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Article 28

Compliant products which present a risk to maritime safety, to health or to ▌ the environment

1. Where, having performed an evaluation under Article 26(1), a Member State finds that

although marine equipment is in compliance with this Directive, it presents a risk to

maritime safety, to health or to the environment, it shall require the ▌economic

operator concerned to take all appropriate measures to ensure that the marine

equipment concerned, when placed on the market, no longer presents that risk, to

withdraw the marine equipment from the market or to recall it within such reasonable

period, commensurate with the nature of the risk, as it may prescribe.

2. The economic operator shall ensure that corrective action is taken in respect of all the

products concerned that he has made available on the market throughout the Union or

placed on board EU ships.

3. The Member State shall immediately inform the Commission and the other Member

States. That information shall include all available details, in particular the data

necessary for the identification of the marine equipment concerned, the origin and the

supply chain of the marine equipment, the nature of the risk involved and the nature

and duration of the national measures taken.

234

4. The Commission shall without delay enter into consultation with the Member States

and the relevant economic operator or operators and shall evaluate the national

measures taken. On the basis of the results of that evaluation, the Commission shall

decide whether the measure is justified or not, and where necessary, propose

appropriate measures; for this purpose, Article 27(2) shall apply mutatis mutandis.

5. The Commission shall address its decision to all Member States and shall immediately

communicate it to them and the relevant economic operator or operators.

Article 29

Formal non-compliance

1. Without prejudice to Article 26, where a Member State makes one of the following

findings, it shall require the relevant economic operator to put an end to the

non-compliance concerned:

(a) the wheel mark has been affixed in violation of Article 9 or ▌ Article 10;

(b) the wheel mark has not been affixed;

(c) the EU declaration of conformity has not been drawn up;

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(d) the EU declaration of conformity has not been drawn up correctly;

(e) technical documentation is either not available or not complete;

(f) the EU declaration of conformity has not been sent to the ship.

2. Where the non-compliance referred to in paragraph 1 persists, the Member State

concerned shall take all appropriate measures to restrict or prohibit the marine

equipment being made available on the market or ensure that it is recalled or

withdrawn from the market.

Article 30

Exemptions based on technical innovation

1. In exceptional circumstances of technical innovation, the flag State administration may

permit marine equipment which does not comply with the conformity assessment

procedures to be placed on board an EU ship if it is established by trial or otherwise to

the satisfaction of the flag State administration that such equipment meets the

objectives of this Directive.

2. The trial procedures shall in no way discriminate between marine equipment produced

in the flag Member State and marine equipment produced in other States.

236

3. Marine equipment covered by this Article shall be given a certificate by the flag

Member State which shall at all times be carried with the equipment and which gives

the flag Member State's permission for the equipment to be placed on board the ship

and imposes any restrictions or lays down any provisions relating to the use of the

equipment.

4. Where a Member State allows marine equipment covered by this Article to be placed

on board an EU ship, that Member State shall forthwith communicate the particulars

thereof together with the reports of all relevant trials, assessments and conformity-

assessment procedures to the Commission and the other Member States.

5. Within 12 months of receipt of the communication referred to in paragraph 4, the

Commission, if it considers that the conditions laid down in paragraph 1 are not met,

may require the Member State concerned to withdraw the permission granted within a

specified deadline. For this purpose, the Commission shall act by means of

implementing acts. Those implementing acts shall be adopted in accordance with the

examination procedure referred to in Article 38(2).

6. Where a ship with marine equipment on board which is covered by paragraph 1 is

transferred to another Member State, the receiving flag Member State may undertake

the necessary measures, which may include tests and practical demonstrations, to

ensure that the equipment is at least as effective as equipment which does comply with

the conformity-assessment procedures.

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Article 31

Exemptions for testing or evaluation

A flag State administration may permit marine equipment which does not comply with the

conformity-assessment procedures or is not covered by Article 30 to be placed on board an EU

ship for reasons of testing or evaluation, if the following cumulative conditions are complied

with:

(a) the marine equipment shall be given a certificate by the flag Member State which shall

at all times be carried with the equipment, state the said Member State's permission for

the equipment to be placed on board the EU ship, impose all necessary restrictions and

lay down any other appropriate provisions as regards the use of the equipment

concerned;

(b) the permission shall be limited to the period considered by the flag State as being

necessary to complete the testing, which should be as short as possible;

(c) the marine equipment shall not be relied on in place of equipment which meets the

requirements of this Directive and shall not replace such equipment, which shall

remain on board the EU ship in working order and ready for immediate use.

238

Article 32

Exemptions in exceptional circumstances

1. In exceptional circumstances, which shall be duly justified to the flag State

administration, when marine equipment needs to be replaced in a port outside the

Union where it is not practicable in terms of reasonable time, delay and cost to place

on board equipment which bears the wheel mark, other marine equipment may be

placed on board subject to paragraphs 2 to 4 ▌.

2. The marine equipment placed on board shall be accompanied by documentation issued

by a Member State of the IMO which is a party to the relevant conventions, certifying

compliance with the relevant IMO requirements.

3. The flag State administration shall be informed at once of the nature and characteristics

of such other marine equipment.

4. The flag State administration shall, at the earliest opportunity, ensure that the marine

equipment referred to in paragraph 1, along with its testing documentation, complies

with the relevant requirements of the international instruments and of this Directive.

5. Where it has been demonstrated that specific marine equipment bearing the wheel

mark is not available on the market, the flag Member State may authorise other marine

equipment to be placed on board subject to ▌ paragraphs 6 to 8 ▌.

239

6. The authorised marine equipment shall comply, as much as possible, with the

requirements and testing standards referred to in Article 4.

7. The marine equipment placed on board shall be accompanied by an interim certificate

of approval issued by the flag Member State or by another Member State, stating

the following:

(a) the equipment bearing the wheel mark which the certified equipment is due

to replace;

(b) the exact circumstances under which the certificate of approval has been issued,

and in particular the unavailability in the market of equipment bearing the wheel

mark;

(c) the exact design, construction and performance requirements against which the

equipment has been approved by the certifying Member State;

(d) the testing standards applied, if any, in the relevant approval procedures.

8. The Member State issuing an interim certificate of approval shall inform the

Commission forthwith. If the Commission considers that the conditions of paragraphs

6 and 7 have not been met, it may require that Member State to revoke the said

certificate or take other appropriate measures by means of implementing acts. Those

implementing acts shall be adopted in accordance with the examination procedure

referred to in Article 38(2).

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Chapter 6

Final provisions

Article 33

Exchange of experience

The Commission shall provide for the organisation of exchanges of experience between the

Member States' national authorities responsible for notification policy, especially as regards

market surveillance.

Article 34

Coordination of notified bodies

1. The Commission shall ensure that appropriate coordination and cooperation

between notified bodies are put in place and properly operated in the form of a

sectoral group of notified bodies.

2. Member States shall ensure that the bodies notified by them participate in the work

of the sectoral group, directly or by means of designated representatives.

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Article 35

Implementing measures

1. The Member States shall, by means of the information system made available by the

Commission for that purpose, notify to the Commission the name and contact details

of the authorities in charge of the implementation of this Directive. The Commission

shall draw up, periodically update and make public a list of those authorities.

2. For each item of marine equipment for which the approval of the flag State

administration is required by the international conventions, the Commission shall

indicate by means of implementing acts the respective design, construction and

performance requirements and the testing standards provided for in the international

instruments. When adopting those acts, the Commission shall explicitly indicate the

dates from which those requirements and testing standards are to apply, including

the dates for placing on the market and placing on board, in accordance with the

international instruments, and taking into consideration timeframes for ship-

building. The Commission may also specify the common criteria and detailed

procedures for their application.

▌

3. The Commission shall, by means of implementing acts, indicate the respective design,

construction and performance requirements newly provided for in the international

instruments and which apply to equipment already placed on board ▌ in order to

ensure that equipment placed on board ▌EU ships complies with the international

instruments.

242

4. The Commission shall set up and maintain a data base containing at least the following

information:

(a) the list and essential details of the conformity certificates issued under this

Directive, provided by the notified bodies;

(b) the list and essential details of the declarations of conformity issued under this

Directive, provided by the manufacturers;

(c) an up-to-date list of the applicable international instruments, and of the

requirements and testing standards ▌ applicable by virtue of Article 4(4);

(d) the list and full text of the criteria and procedures referred to in paragraph 2;

(e) the requirements and conditions for electronic tagging referred to in Article 11,

when applicable;

(f) any other useful information with a view to facilitating correct implementation of

this Directive by the Member States, the notified bodies and the economic

operators.

That database shall be made accessible to the Member States. It shall also be made

available ▌ to the public for information purposes only.

5. The implementing acts referred to in this Article shall be adopted in the form of

Commission Regulations in accordance with the examination procedure referred to in

Article 38(2).

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Article 36

Amendments

This Directive may be amended by the Commission, by means of delegated acts, in order to ▌

update the references to ▌ standards, as referred to in Annex III, when new standards

become available.

Those delegated acts shall be adopted in accordance with the procedure laid down in Article 37.

Article 37

Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the

conditions laid down in this Article.

2. The ▌ power to adopt delegated acts referred to in Articles 8, 11, 27 and 36 shall be

conferred on the Commission for a period of five years from …. The Commission

shall draw up a report in respect of the delegation of power not later than nine

months before the end of the five-year period. The delegation of power shall be

tacitly extended for periods of an identical duration, unless the European

Parliament or the Council opposes such extension not later than three months

before the end of each period.

OJ: Please insert date: the date of entry into force of this Directive.

244

3. The delegation of power referred to in Articles 8, 11, 27 and 36 may be revoked at any

time by the European Parliament or by the Council. A decision to revoke shall put an

end to the delegation of the power specified in that decision. It shall take effect the day

following the publication of the decision in the Official Journal of the European Union

or at a later date specified therein. It shall not affect the validity of any delegated acts

already in force.

4. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to

the European Parliament and to the Council.

5. A delegated act adopted pursuant to Articles 8, 11, 27 and 36 shall enter into force

only if no objection has been expressed either by the European Parliament or the

Council within a period of two months of notification of that act to the European

Parliament and the Council or if, before the expiry of that period, the European

Parliament and the Council have both informed the Commission that they will not

object. That period shall be extended by two months at the initiative of the European

Parliament or of the Council.

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Article 38

Committee

1. The Commission shall be assisted by the Committee on Safe Seas and the Prevention

of Pollution from Ships (COSS) established by Regulation (EC) No 2099/2002 ▌. That

committee shall be a committee within the meaning of Regulation (EU) No 182/2011.

▌

2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011

shall apply. Where the committee delivers no opinion, the Commission shall not

adopt the draft implementing act and the third subparagraph of Article 5(4) of

Regulation (EU) No 182/2011 shall apply.

Article 39

Transposition

1. Member States shall adopt and publish, by … at the latest, the laws, regulations and

administrative provisions necessary to comply with this Directive. They shall forthwith

communicate to the Commission the text of those provisions.

They shall apply those provisions from ….

OJ: Please insert date: 24 months after the date of entry into force of this Directive.

246

When Member States adopt those provisions, they shall contain a reference to this

Directive or be accompanied by such a reference on the occasion of their official

publication. Member States shall determine how such reference is to be made.

2. Member States shall communicate to the Commission the text of the main provisions

of national law which they adopt in the field covered by this Directive.

Article 40

Repeal

1. ▌Directive 96/98/EC is repealed with effect from ….

2. The requirements and testing standards for marine equipment applicable on …

pursuant to the provisions of national law adopted by the Member States in order to

comply with Directive 96/98/EC shall continue to apply until the entry into force of the

implementing acts referred to in Article 35(2).

3. References to the repealed Directive shall be construed as references to this Directive.

OJ: Date of application of this Directive.

247

Article 41

Entry into force

This Directive shall enter into force on the twentieth day following that of its publication in the

Official Journal of the European Union.

Article 42

Addressees

This Directive is addressed to the Member States.

Done at

For the European Parliament For the Council

The President The President

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ANNEX I

WHEEL MARK

The mark of conformity must take the following form:

If the wheel mark is reduced or enlarged the proportions given in the graduated drawing must

be respected.

The various components of the wheel mark must have substantially the same vertical

dimension, which may not be less than 5 mm.

That minimum dimension may be waived for small devices.

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ANNEX II

CONFORMITY ASSESSMENT PROCEDURES

I. MODULE B: EC TYPE-EXAMINATION

1. EC type-examination is the part of a conformity assessment procedure in which a

notified body examines the technical design of marine equipment and verifies and

attests that the technical design of the marine equipment meets the relevant

requirements ▌.

2. EC type-examination may be carried out in either of the following manners:

– examination of a specimen, representative of the production envisaged, of the

complete product (production type);

– assessment of the adequacy of the technical design of the marine equipment

through examination of the technical documentation and supporting evidence

referred to in point 3, plus examination of specimens, representative of the

production envisaged, of one or more critical parts of the product (combination

of production type and design type);

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3. The manufacturer shall lodge an application for EC type -examination with a single

notified body of his choice.

The application shall include:

▌

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

– a written declaration that the same application has not been lodged with any

other notified body;

– the technical documentation. The technical documentation shall make it possible

to assess the conformity of the marine equipment with the applicable

requirements of the international instruments as referred to in Article 4, and shall

include an adequate analysis and assessment of the risk(s). The technical

documentation shall specify the applicable requirements and cover, as far as

relevant for the assessment, the design, manufacture and operation of the marine

equipment. The technical documentation shall contain, wherever applicable, at

least the following elements:

– a general description of the marine equipment,

251

– conceptual design and manufacturing drawings and schemes of

components, sub-assemblies, circuits, etc.,

(a) descriptions and explanations necessary for the understanding of

those drawings and schemes and the operation of the marine

equipment,

(b) a list of the requirements and testing standards which are applicable

to the marine equipment concerned in accordance with this Directive,

together with a description of the solutions adopted to meet the said

requirements,

(c) results of design calculations made, examinations carried out, etc.,

and

(d) test reports;

– the specimens representative of the production envisaged. The notified body may

request further specimens if needed for carrying out the test programme;

– the supporting evidence for the adequacy of the technical design solution. This

supporting evidence shall mention any documents that have been used. The

supporting evidence shall include, where necessary, the results of tests carried

out by the appropriate laboratory of the manufacturer, or by another testing

laboratory on his behalf and under his responsibility.

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4. The notified body shall:

For the marine equipment:

4.1. examine the technical documentation and supporting evidence to assess the adequacy

of the technical design of the marine equipment;

For the specimen(s):

4.2. verify that the specimen(s) have been manufactured in conformity with the technical

documentation, and identify the elements which have been designed in accordance

with the applicable provisions of the relevant requirements and testing standards ▌, as

well as the elements which have been designed without applying the relevant

provisions of those standards;

4.3. carry out appropriate examinations and tests, or have them carried out, in accordance

with this Directive;

4.4. agree with the manufacturer on a location where the examinations and tests will be

carried out.

5. The notified body shall draw up an evaluation report that records the activities

undertaken in accordance with point 4 and their outcomes. Without prejudice to its

obligations vis-à vis the notifying authorities, the notified body shall release the

content of that report, in full or in part, only with the agreement of the manufacturer.

253

6. Where the type meets the requirements of the specific international instruments that

apply to the marine equipment concerned, the notified body shall issue an EC type-

examination certificate to the manufacturer. The certificate shall contain the name and

address of the manufacturer, the conclusions of the examination, the conditions (if any)

for its validity and the necessary data for identification of the approved type. The

certificate may have one or more annexes attached.

The certificate and its annexes shall contain all relevant information to allow the

conformity of manufactured products with the examined type to be evaluated and to

allow for in-service control.

Where the type does not satisfy the applicable requirements of the international

instruments, the notified body shall refuse to issue an EC type-examination certificate

and shall inform the applicant accordingly, giving detailed reasons for its refusal.

7. If the approved type ▌ no longer complies with the applicable requirements, the

notified body shall determine whether further testing or a new conformity assessment

procedure is necessary.

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The manufacturer shall inform the notified body that holds the technical

documentation relating to the EC type-examination certificate of all modifications to

the approved type that may affect the conformity of the marine equipment with the

requirements of the relevant international instruments or the conditions for validity of

the certificate. Such modifications shall require additional approval in the form of an

addition to the original EC type-examination certificate.

8. Each notified body shall inform its notifying authorities concerning the

EC type-examination certificates and/or any additions thereto which it has issued or

withdrawn, and shall, periodically or upon request, make available to its notifying

authorities the list of certificates and/or any additions thereto refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies concerning the

EC type-examination certificates and/or any additions thereto which it has refused,

withdrawn, suspended or otherwise restricted, and, upon request, concerning the

certificates and/or additions thereto which it has issued.

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The Commission, the Member States and the other notified bodies may, on request,

obtain a copy of the EC type-examination certificates and/or additions thereto. On

request, the Commission and the Member States may obtain a copy of the technical

documentation and the results of the examinations carried out by the notified body.

The notified body shall keep a copy of the EC type-examination certificate, its annexes

and additions, as well as the technical file including the documentation submitted by

the manufacturer, until the expiry of the validity of the certificate.

9. The manufacturer shall keep a copy of the EC type-examination certificate, its annexes

and additions together with the technical documentation at the disposal of the national

authorities for at least 10 years after the wheel mark has been affixed on the last

product ▌manufactured and in no case less than the expected life of the marine

equipment concerned.

10. The manufacturer's authorised representative may lodge the application referred to in

point 3 and fulfil the obligations set out in points 7 and 9, provided that they are

specified in the mandate.

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II. MODULE D: CONFORMITY TO TYPE BASED ON QUALITY ASSURANCE OF THE

PRODUCTION PROCESS

1. Conformity to type based on quality assurance of the production process is the part of

a conformity assessment procedure whereby the manufacturer fulfils the obligations

laid down in points 2 and 5, and ensures and declares on his sole responsibility that the

marine equipment concerned is in conformity with the type described in the EC type-

examination certificate and satisfies the requirements of the international instruments

that apply to it.

2. Manufacturing

The manufacturer shall operate an approved quality system for production, final

product inspection and testing of the products concerned as specified in point 3, and

shall be subject to surveillance as specified in point 4.

3. Quality system

3.1. The manufacturer shall lodge an application for assessment of his quality system with

the notified body of his choice, for the marine equipment concerned.

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The application shall include:

▌

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well,

– a written declaration that the same application has not been lodged with any

other notified body,

– all relevant information for the marine equipment category envisaged,

– the documentation concerning the quality system,

– the technical documentation of the approved type and a copy of the

EC type-examination certificate.

3.2. The quality system shall ensure that the products are in conformity with the type

described in the EC type-examination certificate and comply with the requirements of

the international instruments that apply to them.

258

All the elements, requirements and provisions adopted by the manufacturer shall be

documented in a systematic and orderly manner in the form of written policies,

procedures and instructions. The quality system documentation shall permit a

consistent interpretation of the quality programmes, plans, manuals and records.

It shall, in particular, contain an adequate description of:

– the quality objectives and the organisational structure, responsibilities and

powers of the management with regard to product quality,

– the corresponding manufacturing, quality control and quality assurance

techniques, processes and systematic actions that will be used,

– the examinations and tests that will be carried out before, during and after

manufacture, and the frequency with which they will be carried out,

– the quality records, such as inspection reports and test data, calibration data,

qualification reports on the personnel concerned, etc. and

– the means of monitoring the achievement of the required product quality and the

effective operation of the quality system.

3.3. The notified body shall assess the quality system to determine whether it satisfies the

requirements referred to in point 3.2.

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In addition to experience in quality management systems, the auditing team shall have

at least one member with experience of evaluation in the relevant marine equipment

field and marine equipment technology concerned, and knowledge of the applicable

requirements of the international instruments. The audit shall include an assessment

visit to the manufacturer's premises. The auditing team shall review the technical

documentation referred to in point 3.1, fifth indent, to verify the manufacturer's ability

to identify the relevant requirements of the international instruments and to carry out

the necessary examinations with a view to ensuring compliance of the product with

those requirements.

The decision shall be notified to the manufacturer. The notification shall contain the

conclusions of the audit and the reasoned assessment decision.

3.4. The manufacturer shall undertake to fulfil the obligations arising out of the quality

system as approved and to maintain it so that it remains adequate and efficient.

3.5. The manufacturer shall keep the notified body that has approved the quality system

informed of any intended change to the quality system.

The notified body shall evaluate any proposed changes and decide whether the

modified quality system will continue to satisfy the requirements referred to in point

3.2 or whether a re-assessment is necessary.

It shall notify the manufacturer of its decision. The notification shall contain the

conclusions of the examination and the reasoned assessment decision.

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4. Surveillance under the responsibility of the notified body

4.1. The purpose of surveillance is to make sure that the manufacturer duly fulfils the

obligations arising out of the approved quality system.

4.2. The manufacturer shall, for assessment purposes, allow the notified body access to the

manufacture, inspection, testing and storage sites and shall provide it with all

necessary information, in particular:

– the quality system documentation;

– the quality records, such as inspection reports and test data, calibration data,

qualification reports on the personnel concerned, etc.

4.3. The notified body shall carry out periodic audits to make sure that the manufacturer

maintains and applies the quality system and shall provide the manufacturer with an

audit report.

4.4. In addition, the notified body may pay unexpected visits to the manufacturer, except

where, under national law, and for defence or security reasons, certain restrictions

apply to such visits. During such visits the notified body may, if necessary, carry out

product tests, or have them carried out, in order to verify that the quality system is

functioning correctly. The notified body shall provide the manufacturer with a visit

report and, if tests have been carried out, with a test report.

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5. Conformity marking and declaration of conformity

5.1. The manufacturer shall affix the wheel mark referred to in Article 9, and, under the

responsibility of the notified body referred to in point 3.1, the latter's identification

number to each individual product that is in conformity with the type described in the

EC type-examination certificate and satisfies the applicable requirements of the

international instruments.

5.2. The manufacturer shall draw up a written declaration of conformity for each product

model and keep it at the disposal of the national authorities for at least 10 years after

the wheel mark has been affixed on the last product ▌ manufactured and in no case

less than the expected life of the marine equipment concerned. The declaration of

conformity shall identify the marine equipment model for which it has been drawn up.

A copy of the declaration of conformity shall be made available to the relevant

authorities upon request.

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6. The manufacturer shall keep at the disposal of the competent authorities, for ▌at

least 10 years after the wheel mark has been affixed on the last product manufactured

and in no case less than the expected life of the marine equipment concerned:

– the documentation referred to in point 3.1,

– the change referred to in point 3.5, as approved,

– the decisions and reports of the notified body referred to in points 3.5, 4.3 and

4.4.

7. Each notified body shall inform its notifying authorities of quality system approvals

issued or withdrawn, and shall, periodically or upon request, make available to its

notifying authorities the list of quality system approvals refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies of quality system approvals

which it has refused, suspended, withdrawn or otherwise restricted, and, upon request,

of quality system approvals which it has issued.

8. Authorised representative

The manufacturer's obligations set out in points 3.1, 3.5, 5 and 6 may be fulfilled by

his authorised representative, on his behalf and under his responsibility, provided that

they are specified in the mandate.

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III. MODULE E: CONFORMITY TO TYPE BASED ON PRODUCT QUALITY ASSURANCE

1. Conformity to type based on product quality assurance is that part of a conformity

assessment procedure whereby the manufacturer fulfils the obligations laid down in

points 2 and 5, and ensures and declares on his sole responsibility that the marine

equipment concerned is in conformity with the type described in the EC type-

examination certificate and satisfies the requirements of the international instruments

that apply to it.

2. Manufacturing

The manufacturer shall operate an approved quality system for final product inspection

and testing of the products concerned as specified in point 3 and shall be subject to

surveillance as specified in point 4.

3. Quality system

3.1. The manufacturer shall lodge an application for assessment of his quality system with

the notified body of his choice, for the marine equipment concerned.

The application shall include:

▌

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well,

264

– a written declaration that the same application has not been lodged with any

other notified body,

– all relevant information for the marine equipment category envisaged,

– the documentation concerning the quality system, and

– the technical documentation of the approved type and a copy of the

EC type-examination certificate.

3.2. The quality system shall ensure compliance of the products with the type described in

the EC type-examination certificate and with the applicable requirements of the

international instruments.

All the elements, requirements and provisions adopted by the manufacturer shall be

documented in a systematic and orderly manner in the form of written policies,

procedures and instructions. The quality system documentation shall permit a

consistent interpretation of the quality programmes, plans, manuals and records.

It shall, in particular, contain an adequate description of:

– the quality objectives and the organisational structure, responsibilities and

powers of the management with regard to product quality;

265

– the examinations and tests that will be carried out after manufacture;

– the quality records, such as inspection reports and test data, calibration data,

qualification reports on the personnel concerned, etc.;

– the means of monitoring the effective operation of the quality system.

3.3. The notified body shall assess the quality system to determine whether it satisfies the

requirements referred to in point 3.2.

In addition to experience in quality management systems, the auditing team shall have

at least one member with experience of evaluation in the relevant marine equipment

field and marine equipment technology concerned, and knowledge of the applicable

requirements of the international instruments. The audit shall include an assessment

visit to the manufacturer's premises. The auditing team shall review the technical

documentation referred to in point 3.1, fifth indent, in order to verify the

manufacturer's ability to identify the relevant requirements of the international

instruments and to carry out the necessary examinations with a view to ensuring

compliance of the product with those requirements.

The decision shall be notified to the manufacturer. The notification shall contain the

conclusions of the audit and the reasoned assessment decision.

3.4. The manufacturer shall undertake to fulfil the obligations arising out of the quality

system as approved and to maintain it so that it remains adequate and efficient.

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3.5. The manufacturer shall keep the notified body that has approved the quality system

informed of any intended change to the quality system.

The notified body shall evaluate any proposed changes and decide whether the

modified quality system will continue to satisfy the requirements referred to in point

3.2 or whether a re-assessment is necessary.

It shall notify the manufacturer of its decision. The notification shall contain the

conclusions of the examination and the reasoned assessment decision.

4. Surveillance under the responsibility of the notified body

4.1. The purpose of surveillance is to make sure that the manufacturer duly fulfils the

obligations arising out of the approved quality system.

4.2. The manufacturer shall, for assessment purposes, allow the notified body access to the

manufacture, inspection, testing and storage sites and shall provide it with all

necessary information, in particular:

– the quality system documentation;

– the quality records, such as inspection reports and test data, calibration data,

qualification reports on the personnel concerned, etc.

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4.3. The notified body shall carry out periodic audits to make sure that the manufacturer

maintains and applies the quality system and shall provide the manufacturer with an

audit report.

4.4. In addition, the notified body may pay unexpected visits to the manufacturer, except

where, under national law, and for defence or security reasons, certain restrictions

apply to such visits. During such visits the notified body may, if necessary, carry out

product tests, or have them carried out, in order to verify that the quality system is

functioning correctly. The notified body shall provide the manufacturer with a visit

report and, if tests have been carried out, with a test report.

5. Conformity marking and declaration of conformity

5.1. The manufacturer shall affix the wheel mark referred to in Article 9, and, under the

responsibility of the notified body referred to in point 3.1, the latter's identification

number to each individual product that is in conformity with the type described in the

EC type-examination certificate and satisfies the applicable requirements of the

international instruments.

5.2. The manufacturer shall draw up a written declaration of conformity for each product

model and keep it at the disposal of the national authorities for at least 10 years after

the wheel mark has been affixed on the last product ▌manufactured and in no case

less than the expected life of the marine equipment concerned. The declaration of

conformity shall identify the marine equipment model for which it has been drawn up.

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A copy of the declaration of conformity shall be made available to the relevant

authorities upon request.

6. The manufacturer shall keep at the disposal of the competent authorities, for ▌at

least 10 years after the wheel mark has been affixed on the last product manufactured

and in no case less than the expected life of the marine equipment concerned:

– the documentation referred to in point 3.1;

– the change referred to in point 3.5, as approved;

– the decisions and reports of the notified body referred to in points 3.5, 4.3 and

4.4.

7. Each notified body shall inform its notifying authorities of quality system approvals

issued or withdrawn, and shall, periodically or upon request, make available to its

notifying authorities the list of quality system approvals refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies of quality system approvals

which it has refused, suspended or withdrawn, and, upon request, of quality system

approvals which it has issued.

8. Authorised representative

The manufacturer's obligations set out in points 3.1, 3.5, 5 and 6 may be fulfilled by

his authorised representative, on his behalf and under his responsibility, provided that

they are specified in the mandate.

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IV. MODULE F: CONFORMITY TO TYPE BASED ON PRODUCT VERIFICATION

1. Conformity to type based on product verification is the part of a conformity

assessment procedure whereby the manufacturer fulfils the obligations laid down in

points 2, 5.1 and 6, and ensures and declares on his sole responsibility that the products

concerned, which have been subject to the provisions of point 3, are in conformity with

the type described in the EC type-examination certificate and satisfy the requirements

of the international instruments that apply to them.

2. Manufacturing

The manufacturer shall take all measures necessary so that the manufacturing process

and its monitoring ensure conformity of the manufactured products with the approved

type described in the EC type-examination certificate and with the requirements of the

international instruments that apply to them.

3. Verification

A notified body chosen by the manufacturer shall carry out appropriate examinations

and tests in order to check the conformity of the products with the approved type

described in the EC type-examination certificate and with the appropriate requirements

of the international instruments.

▌

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The examinations and tests to check the conformity of the products with the

appropriate requirements shall be carried out, at the choice of the manufacturer either

by examination and testing of every product as specified in point 4 or by examination

and testing of the products on a statistical basis as specified in point 5.

4. Verification of conformity by examination and testing of every product

4.1 All products shall be individually examined and tested in accordance with this

Directive, in order to verify conformity with the approved type described in the EC

type-examination certificate and with the appropriate requirements of the international

instruments.

4.2. The notified body shall issue a certificate of conformity in respect of the examinations

and tests carried out, and shall affix its identification number to each approved product

or have it affixed under its responsibility.

The manufacturer shall keep the certificates of conformity available for inspection by

the national authorities for at least 10 years after the wheel mark has been affixed on

the last product ▌ manufactured and in no case less than the expected life of the

marine equipment concerned.

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5. Statistical verification of conformity

5.1. The manufacturer shall take all measures necessary so that the manufacturing process

and its monitoring ensure the homogeneity of each lot produced, and shall present his

products for verification in the form of homogeneous lots.

5.2. A random sample shall be taken from each lot. All products in a sample shall be

individually examined and tested in accordance with this Directive, in order to ensure

their conformity with the applicable requirements of the international instruments and

to determine whether the lot is accepted or rejected.

5.3. If a lot is accepted, all products of the lot shall be considered approved, except for

those products from the sample that have been found not to satisfy the tests.

The notified body shall issue a certificate of conformity in respect to the examinations

and tests carried out, and shall affix its identification number to each approved product

or have it affixed under its responsibility.

The manufacturer shall keep the certificates of conformity at the disposal of the

national authorities for at least 10 years after the wheel mark has been affixed on the

last product ▌manufactured and in no case less than the expected life of the marine

equipment concerned.

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5.4. If a lot is rejected, the notified body or the competent authority shall take appropriate

measures to prevent that lot being placed on the market. In the event of the frequent

rejection of lots the notified body may suspend the statistical verification and take

appropriate measures.

6. Conformity marking and declaration of conformity

6.1. The manufacturer shall affix the required conformity marking set out in Article 9, and,

under the responsibility of the notified body referred to in point 3, the latter's

identification number to each individual product that is in conformity with the

approved type described in the EC type-examination certificate and satisfies the

applicable requirements of the international instruments.

6.2. The manufacturer shall draw up a written declaration of conformity for each product

model and keep it at the disposal of the national authorities, for at least 10 years after

the wheel mark has been affixed on the last product ▌ manufactured and in no case

less than the expected life of the marine equipment concerned. The declaration of

conformity shall identify the marine equipment model for which it has been drawn up.

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A copy of the declaration of conformity shall be made available to the relevant

authorities upon request.

7. If the notified body agrees and under its responsibility, the manufacturer may affix the

notified body's identification number to the products during the manufacturing process.

8. Authorised representative

The manufacturer's obligations may be fulfilled by his authorised representative, on his

behalf and under his responsibility, provided that they are specified in the mandate. An

authorised representative may not fulfil the manufacturer's obligations set out in points

2 and 5.1.

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V. MODULE G: CONFORMITY BASED ON UNIT VERIFICATION

1. Conformity based on unit verification is the conformity assessment procedure whereby

the manufacturer fulfils the obligations laid down in points 2, 3 and 5, and ensures and

declares on his sole responsibility that the product concerned, which has been subject

to the provisions of point 4, is in conformity with the requirements of the international

instruments that apply to it.

2. Technical documentation

The manufacturer shall establish the technical documentation and make it available to

the notified body referred to in point 4. The documentation shall make it possible to

assess the product's conformity with the relevant requirements, and shall include an

adequate analysis and assessment of the risk(s). The technical documentation shall

specify the applicable requirements and cover, as far as relevant for the assessment, the

design, manufacture and operation of the product. The technical documentation shall,

wherever applicable, contain at least the following elements:

▌

– a general description of the product,

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– conceptual design and manufacturing drawings and schemes of components,

sub-assemblies, circuits, etc.,

– descriptions and explanations necessary for the understanding of those drawings

and schemes and the operation of the product,

– a list of the requirements and testing standards which are applicable to the

marine equipment concerned in accordance with this Directive, together with a

description of the solutions adopted to meet the said requirements,

– results of design calculations made, examinations carried out; and

– test reports.

The manufacturer shall keep the technical documentation at the disposal of the relevant

national authorities for at least 10 years after the wheel mark has been affixed on the

last product ▌ manufactured and in no case less than the expected life of the marine

equipment concerned.

3. Manufacturing

The manufacturer shall take all measures necessary so that the manufacturing process

and its monitoring ensure conformity of the manufactured product with the applicable

requirements of the international instruments.

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4. Verification

A notified body chosen by the manufacturer shall carry out appropriate examinations

and tests in accordance with this Directive, in order to check the conformity of the

product with the applicable requirements of the international instruments.

The notified body shall issue a certificate of conformity in respect of the examinations

and tests carried out and shall affix its identification number to the approved product,

or have it affixed under its responsibility.

The manufacturer shall keep the certificates of conformity at the disposal of the

national authorities for at least 10 years after the wheel mark has been affixed on the

last product ▌manufactured and in no case less than the expected life of the marine

equipment concerned.

5. Conformity marking and declaration of conformity

5.1. The manufacturer shall affix the wheel mark referred to in Article 9 and, under the

responsibility of the notified body referred to in point 4, the latter's identification

number to each product that satisfies the applicable requirements of the international

instruments.

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5.2. The manufacturer shall draw up a written declaration of conformity and keep it at the

disposal of the national authorities for at least 10 years after the wheel mark has been

affixed on the last product ▌ manufactured and in no case less than the expected life

of the marine equipment concerned. The declaration of conformity shall identify the

product for which it has been drawn up.

A copy of the declaration of conformity shall be made available to the relevant

authorities upon request.

6. Authorised representative

The manufacturer's obligations set out in points 2 and 5 may be fulfilled by his

authorised representative, on his behalf and under his responsibility, provided that they

are specified in the mandate.

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ANNEX III

REQUIREMENTS TO BE MET BY CONFORMITY ASSESSMENT BODIES

IN ORDER TO BECOME NOTIFIED BODIES

1. For the purposes of notification, a conformity assessment body shall meet the

requirements laid down in points 2 to 11.

2. A conformity assessment body shall be established under national law and have

legal personality.

3. A conformity assessment body shall be a third-party body independent of the

organisation or the marine equipment it assesses.

4. A body belonging to a business association or professional federation representing

undertakings involved in the design, manufacturing, provision, assembly, use or

maintenance of marine equipment which it assesses, may, on condition that its

independence and the absence of any conflict of interest are demonstrated, be

considered such a body.

5. A conformity assessment body, its top level management and the personnel

responsible for carrying out the conformity assessment tasks shall not be the designer,

manufacturer, supplier, installer, purchaser, owner, user or maintainer of the marine

equipment which they assess, nor the authorised representative of any of those parties.

This shall not preclude the use of assessed products that are necessary for the

operations of the conformity assessment body or the use of such products for personal

purposes.

279

6. A conformity assessment body, its top level management and the personnel

responsible for carrying out the conformity assessment tasks shall not be directly

involved in the design, manufacture or construction, the marketing, installation, use or

maintenance of that marine equipment, or represent the parties engaged in those

activities. They shall not engage in any activity that may conflict with their

independence of judgement or integrity in relation to conformity assessment activities

for which they are notified. This shall in particular apply to consultancy services.

7. Conformity assessment bodies shall ensure that the activities of their subsidiaries or

subcontractors do not affect the confidentiality, objectivity or impartiality of their

conformity assessment activities.

8. Conformity assessment bodies and their personnel shall carry out the conformity

assessment activities with the highest degree of professional integrity and the requisite

technical competence in the specific field and shall be free from all pressures and

inducements, particularly financial, which might influence their judgement or the

results of their conformity assessment activities, especially as regards persons or

groups of persons with an interest in the results of those activities.

9. A conformity assessment body shall be capable of carrying out all the conformity

assessment tasks assigned to it under this Directive and in relation to which it has been

notified, whether those tasks are carried out by the conformity assessment body itself

or on its behalf and under its responsibility.

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10. At all times and for each conformity assessment procedure and each kind, category or

sub- category of marine equipment in relation to which it has been notified, a

conformity assessment body shall have at its disposal the necessary:

(a) personnel with technical knowledge and sufficient and appropriate experience to

perform the conformity assessment tasks;

(b) descriptions of procedures in accordance with which conformity assessment is

carried out, ensuring the transparency and the ability of reproduction of those

procedures. It shall have appropriate policies and procedures in place that

distinguish between tasks it carries out as a notified body and other activities;

(c) procedures for the performance of activities which take due account of the size

of an undertaking, the sector in which it operates, its structure, the degree of

complexity of the marine equipment technology in question and the mass or

serial nature of the production process.

11. A conformity assessment body shall have the means necessary to perform the technical

and administrative tasks connected with the conformity assessment activities in an

appropriate manner and shall have access to all necessary equipment or facilities.

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12. The personnel responsible for carrying out conformity assessment activities shall have

the following:

(a) sound technical and vocational training covering all the conformity assessment

activities in relation to which the conformity assessment body has been notified;

(b) satisfactory knowledge of the requirements of the assessments they carry out and

adequate authority to carry out those assessments;

(c) appropriate knowledge and understanding ▌ of the applicable requirements and

testing standards and of the relevant provisions of EU harmonisation legislation

and of its implementing regulations;

(d) the ability to draw up certificates, records and reports demonstrating that

assessments have been carried out.

13. The impartiality of the conformity assessment bodies, their top level management and

of the assessment personnel shall be guaranteed.

14. The remuneration of the top level management and assessment personnel of a

conformity assessment body shall not depend on the number of assessments carried out

or on the results of those assessments.

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15. Conformity assessment bodies shall take out liability insurance unless liability is

assumed by the State in accordance with national law, or the Member State itself is

directly responsible for the conformity assessment.

16. The personnel of a conformity assessment body shall observe professional secrecy

with regard to all information obtained in carrying out their tasks under this Directive

or any provision of national law giving effect to it, except in relation to the competent

authorities of the Member States in which its activities are carried out. Proprietary

rights shall be protected.

17. Conformity assessment bodies shall participate in, or ensure that their assessment

personnel are informed of, the relevant standardisation activities and the activities of

the notified body coordination group established under this Directive and apply as

general guidance the administrative decisions and documents produced as a result of

the work of that group.

18. Conformity assessment bodies shall meet the requirements of standard

EN ▌ ISO/IEC 17065:2012.

19. Conformity assessment bodies shall ensure that testing laboratories used for

conformity-assessment purposes meet the requirements of standard

EN ▌ ISO/IEC 17025:2005.

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ANNEX IV

NOTIFICATION PROCEDURE

1. Application for notification

1.1. A conformity assessment body shall submit an application for notification to the

notifying authority of the Member State in which it is established.

1.2. That application shall be accompanied by a description of the conformity assessment

activities, the conformity assessment module or modules and the marine equipment for

which that body claims to be competent, as well as by an accreditation certificate,

where one exists, issued by a national accreditation body attesting that the conformity

assessment body fulfils the requirements laid down in Annex III ▌.

1.3. Where the conformity assessment body concerned cannot provide an accreditation

certificate, it shall provide the notifying authority with all the documentary evidence

necessary for the verification, recognition and regular monitoring of its compliance

with the requirements laid down in Annex III .

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2. Notification procedure

2.1. Notifying authorities may notify only conformity assessment bodies which have

satisfied the requirements laid down in Annex III .

2.2. They shall notify the Commission and the other Member States using the electronic

notification tool developed and managed by the Commission.

2.3. The notification shall include full details of the conformity assessment activities, the

conformity assessment module or modules and marine equipment concerned and the

relevant attestation of competence.

2.4. Where a notification is not based on an accreditation certificate as referred to in section

1, the notifying authority shall provide the Commission and the other Member States

with documentary evidence which attests to the conformity assessment body's

competence and the arrangements in place to ensure that that body will be monitored

regularly and will continue to satisfy the requirements laid down in Annex III ▌.

2.5. The body concerned may perform the activities of a notified body only where no

objections are raised by the Commission or the other Member States within two weeks

of a notification where an accreditation certificate is used or within two months of a

notification where accreditation is not used.

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2.6. Only such a body shall be considered a notified body for the purposes of this Directive.

2.7. The Commission and the other Member States shall be notified of any subsequent

relevant changes to the notification.

3. Identification numbers and lists of notified bodies

3.1. The Commission shall assign an identification number to a notified body.

3.2. It shall assign a single such number even where the notified body is recognised as

notified under several EU acts.

3.3. The Commission shall make publicly available the list of the bodies notified under this

Directive, including the identification numbers that have been allocated to them and

the activities for which they have been notified.

3.4. The Commission shall ensure that that list is kept up to date.

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ANNEX V

REQUIREMENTS TO BE MET BY NOTIFYING AUTHORITIES

1. A notifying authority shall be established in such a way that no conflict of interest with

conformity assessment bodies occurs.

2. A notifying authority shall be organised and operated so as to safeguard the objectivity

and impartiality of its activities.

3. A notifying authority shall be organised in such a way that each decision relating to

notification of a conformity assessment body is taken by competent persons different

from those who carried out the assessment.

4. A notifying authority shall not offer or provide any activities that conformity

assessment bodies perform or consultancy services on a commercial or competitive

basis.

5. A notifying authority shall safeguard the confidentiality of the information it obtains.

6. A notifying authority shall have a sufficient number of competent personnel at its

disposal for the proper performance of its tasks.

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P7_TA-PROV(2014)0390

Pressure equipment ***I

European Parliament legislative resolution of 15 April 2014 on the proposal for a directive of the European Parliament and of the Council on the harmonisation of the laws of the Member States relating to making available on the market of pressure equipment (recast) (COM(2013)0471 – C7-0203/2013 – 2013/0221(COD))

(Ordinary legislative procedure – recast)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2013)0471),

– having regard to Article 294(2) and Article 114 of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0203/2013),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to the opinion of the European Economic and Social Committee of 16 October 20131,

– having regard to the Interinstitutional Agreement of 28 November 2001 on a more structured use of the recasting technique for legal acts2,

– having regard to the letter of 16 December 2013 from the Committee on Legal Affairs to the Committee on the Internal Market and Consumer Protection in accordance with Rule 87(3) of its Rules of Procedure,

– having regard to the undertaking given by the Council representative by letter of 12 February 2014 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

– having regard to Rules 87 and 55 of its Rules of Procedure,

– having regard to the report of the Committee on the Internal Market and Consumer Protection (A7-0008/2014),

A. whereas, according to the Consultative Working Party of the legal services of the European Parliament, the Council and the Commission, the proposal in question does not include any substantive amendments other than those identified as such in the proposal and whereas, as regards the codification of the unchanged provisions of the earlier acts together with those

1 OJ C 67, 6.3.2014, p. 101.2 OJ C 77, 28.3.2002, p. 1.

288

amendments, the proposal contains a straightforward codification of the existing texts, without any change in their substance;

1. Adopts its position at first reading hereinafter set out, taking into account the recommendations of the Consultative Working Party of the legal services of the European Parliament, the Council and the Commission;

2. Approves its statement annexed hereto, which will be published in the L series of the Official Journal of the European Union together with the final legislative act;

3. Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

4. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

289

P7_TC1-COD(2013)0221

Position of the European Parliament adopted at first reading on 15 April 2014 with a view to the adoption of Directive 2014/.../EU of the European Parliament and of the Council on the harmonisation of the laws of the Member States relating to the making available on the market of pressure equipment (recast)

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article

114 thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee1,

Acting in accordance with the ordinary legislative procedure2,

Whereas:

1 OJ C 67, 6.3.2014, p. 101.2 Position of the European Parliament of 15 April 2014.

290

(1) Directive 97/23/EC of the European Parliament and of the Council ▌1 has been

substantially amended ▌2. Since further amendments are to be made, that Directive

should be recast in the interests of clarity.

(2) Regulation (EC) No 765/2008 of the European Parliament and of the Council ▌3 lays

down rules on the accreditation of conformity assessment bodies, provides a

framework for the market surveillance of products and for controls on products from

third countries, and lays down the general principles of the CE marking.

1 Directive 97/23/EC of the European Parliament and of the Council of 29 May 1997 on the approximation of the laws of the Member States concerning pressure equipment (OJ L 181, 9.7.1997, p. 1).

2 See Annex V, Part A.3 Regulation (EC) No 765/2008 of the European Parliament and of the Council of 9 July

2008 setting out the requirements for accreditation and market surveillance relating to the marketing of products and repealing Regulation (EEC) No 339/93 (OJ L 218, 13.8.2008, p. 30).

291

(3) Decision No 768/2008/EC of the European Parliament and of the Council ▌1 lays

down ▌ common ▌ principles and reference provisions intended to apply across

sectoral legislation ▌ in order to provide a coherent basis for revision or recasts of that

legislation. Directive 97/23/EC should therefore be adapted to that Decision.

(4) This Directive covers pressure equipment and assemblies which are new to the

Union market when they are placed on the market; that is to say they are either new

pressure equipment or assemblies made by a manufacturer established in the Union

or pressure equipment or assemblies, whether new or second-hand, imported from a

third country.

(5) This Directive should apply to all forms of supply, including distance selling.

(6) This Directive should apply to pressure equipment subject to a maximum allowable

pressure PS greater than 0,5 bar. Pressure equipment subject to a pressure of not more

than 0,5 bar does not pose a significant risk due to pressure. Therefore, there should

not be any obstacle to its free movement within the Union.

1 Decision No 768/2008/EC of the European Parliament and of the Council of 9 July 2008 on a common framework for the marketing of products and repealing Council Decision 93/465/EEC (OJ L 218, 13.8.2008, p. 82).

292

(7) This Directive should also apply to assemblies composed of several pieces of pressure

equipment assembled to constitute an integrated and functional whole. Those

assemblies may range from simple assemblies such as pressure cookers to complex

assemblies such as water tube boilers. If the manufacturer of an assembly intends to

place it on the market and put it into service as an assembly - and not in the form of its

constituent non-assembled elements - that assembly should comply with this Directive.

However, this Directive should not apply to the assembly of pressure equipment on the

site and under the responsibility of a user who is not the manufacturer, as in the case

of industrial installations.

(8) This Directive should harmonise national provisions on risks due to pressure. The

other risks which this equipment may present may fall within the scope of other

Directives dealing with those risks.

293

(9) However, some pressure equipment is covered by other Directives based on Article

114 of the Treaty on the Functioning of the European Union (TFEU). The

provisions laid down in some of those Directives deal also with the risk due to

pressure. Those Directives are considered adequate to provide appropriate protection

where the risk due to pressure associated with such equipment remains small.

Therefore, such equipment should be excluded from the scope of this Directive.

(10) For some pressure equipment covered by international agreements for its international

transport, national transport and pressure hazards and risks are dealt with by Union

Directives based on such agreements. Those Directives extend the application of those

agreements to national transport, in order to ensure the free movement of dangerous

goods whilst enhancing transport safety. Such equipment which is covered by

Directive 2008/68/EC of the European Parliament and of the Council ▌1 and by

Directive 2010/35/EU of the European Parliament and of the Council ▌2 should be

excluded from the scope of this Directive.

1 Directive 2008/68/EC of the European Parliament and of the Council of 24 September 2008 on the inland transport of dangerous goods (OJ L 260, 30.9.2008, p. 13).

2 Directive 2010/35/EU of the European Parliament and of the Council of 16 June 2010 on transportable pressure equipment and repealing Council Directives 76/767/EEC, 84/525/EEC, 84/526/EEC, 84/527/EEC and 1999/36/EC (OJ L 165, 30.6.2010, p. 1).

294

(11) Certain types of pressure equipment, although subject to a maximum allowable

pressure PS greater than 0,5 bar, do not present any significant risk due to pressure,

and therefore the free movement of such equipment in the Union should not be

hindered if it has been legally manufactured or placed on the market in a Member

State. It is not necessary in order to ensure free movement of such equipment to

include it within the scope of this Directive. Consequently it should be expressly

excluded from its scope.

(12) Other pressure equipment subject to a maximum allowable pressure greater than 0,5

bar and presenting a significant risk due to pressure, but in respect of which free

movement and an appropriate level of safety are guaranteed, should be excluded from

the scope of this Directive. Such exclusions should, however, be regularly reviewed in

order to ascertain whether it is necessary to take action at Union level.

(13) The scope of this Directive should be based on a general definition of the term

"pressure equipment" so as to allow for the technical development of products.

295

(14) Compliance with the essential safety requirements is necessary in order to ensure the

safety of pressure equipment. Those requirements should be subdivided into general

and specific requirements that need to be met by pressure equipment. In particular the

specific requirements should take account of particular types of pressure equipment.

Certain types of pressure equipment in categories III and IV should be subject to a

final assessment comprising final inspection and proof tests.

(15) Member States should be in a position to allow the showing at trade fairs of pressure

equipment which is not yet in conformity with the requirements of this Directive.

During demonstrations, appropriate safety measures should be taken in accordance

with the general safety rules of the Member State concerned to ensure the safety of

persons.

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(16) Directive 97/23/EC provides for a classification of pressure equipment in categories,

according to the ascending level of hazard. This includes the classification of the fluid

contained in the pressure equipment as dangerous or not, according to Council

Directive 67/548/EEC ▌1. On 1 June 2015 Directive 67/548/EEC is to be repealed and

replaced by Regulation (EC) No 1272/2008 of the European Parliament and of the

Council ▌2, which implements in the Union the Globally Harmonised System of

Classification and Labelling of Chemicals that has been adopted at international level,

within the United Nations structure. Regulation (EC) No 1272/2008 introduces new

hazard classes and categories only partially corresponding to those provided for by

Directive 67/548/EEC. Directive 97/23/EC should therefore be aligned to Regulation

(EC) No 1272/2008 while maintaining the existing levels of protection provided for in

that Directive.

1 Council Directive 67/548/EEC of 27 June 1967 on the approximation of the laws, regulations and administrative provisions relating to the classification, packaging and labelling of dangerous substances (OJ 196, 16.8.1967, p. 1).

2 Regulation (EC) No 1272/2008 of the European Parliament and of the Council of 16 December 2008 on classification, labelling and packaging of substances and mixtures, amending and repealing Directives 67/548/EEC and 1999/45/EC, and amending Regulation (EC) No 1907/2006 (OJ L 353, 31.12.2008, p. 1).

297

(17) Economic operators should be responsible for the compliance of pressure equipment

and assemblies with the requirements of this Directive, in relation to their respective

roles in the supply chain, so as to ensure a high level of protection of public interests,

such as health and safety of persons, and ▌ the protection of domestic animals and of

property, and to guarantee fair competition on the Union market.

(18) All economic operators intervening in the supply and distribution chain should take

appropriate measures to ensure that they only make available on the market pressure

equipment and assemblies which are in conformity with this Directive. It is necessary

to provide for a clear and proportionate distribution of obligations which correspond to

the role of each economic operator in the supply and distribution chain.

(19) The manufacturer, having detailed knowledge of the design and production process, is

best placed to carry out the ▌conformity assessment procedure. Conformity

assessment should therefore remain solely the obligation of the manufacturer.

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(20) In order to facilitate the communication between economic operators, ▌ market

surveillance authorities and consumers, Member States should encourage economic

operators to include a website address in addition to the postal address.

(21) It is necessary to ensure that pressure equipment and assemblies from third countries

entering the Union market comply with the requirements of this Directive, and in

particular that appropriate conformity assessment procedures have been carried out by

manufacturers with regard to that pressure equipment or those assemblies. Provision

should therefore be made for importers to make sure that the pressure equipment or

assembly they place on the market complies with the requirements of this Directive

and that they do not place on the market pressure equipment or assemblies which do

not comply with such requirements or presents a risk. Provision should also be made

for importers to make sure that the conformity assessment procedures have been

carried out and that marking of pressure equipment or assemblies and documentation

drawn up by manufacturers are available for inspection by the competent national

authorities.

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(22) When placing pressure equipment or assemblies on the market, every importer should

indicate on the pressure equipment or assembly his name, registered trade name or

registered trade mark and the postal address at which he can be contacted. Exceptions

should be provided for in cases where the size or nature of the pressure equipment or

assembly does not allow it. This includes cases where the importer would have to open

the packaging to put his name and address on the pressure equipment or assembly.

(23) The distributor makes pressure equipment or assemblies available on the market after

they have been placed on the market by the manufacturer or the importer and should

act with due care to ensure that its handling of the pressure equipment or assembly

does not adversely affect the compliance of the pressure equipment or assembly with

the requirements of this Directive.

(24) Any economic operator that either places pressure equipment or assemblies on the

market under his own name or trademark or modifies pressure equipment or

assemblies in such a way that compliance with the requirements of this Directive may

be affected should be considered to be the manufacturer and should assume the

obligations of the manufacturer.

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(25) Distributors and importers, being close to the market place, should be involved in

market surveillance tasks carried out by the competent national authorities, and should

be prepared to participate actively, providing those authorities with all necessary

information relating to the pressure equipment or assembly concerned.

(26) Ensuring traceability of pressure equipment and assemblies throughout the whole

supply chain helps to make market surveillance simpler and more efficient. An

efficient traceability system facilitates market surveillance authorities' task of tracing

economic operators who made non-compliant pressure equipment or assemblies

available on the market.

(27) When keeping the information required under this Directive for the identification of

other economic operators, economic operators should not be required to update such

information in respect of other economic operators who have either supplied them with

pressure equipment or an assembly or to whom they have supplied pressure equipment

or an assembly.

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(28) This Directive should be limited to the expression of the essential safety requirements.

In order to facilitate conformity assessment with those requirements it is necessary to

provide for a presumption of conformity for pressure equipment or assemblies which

are in conformity with harmonised standards that are adopted in accordance with

Regulation (EU) No 1025/2012 of the European Parliament and of the Council ▌1 for

the purpose of expressing detailed technical specifications of those requirements,

especially with regard to the design, manufacture and testing of pressure equipment or

assemblies.

(29) Regulation (EU) No 1025/2012 provides for a procedure for objections to harmonised

standards where those standards do not entirely satisfy the requirements of this

Directive.

(30) Manufacturing of pressure equipment calls for the utilisation of safe materials. In the

absence of harmonised standards the characteristics of the materials intended for

repeated use should be established. Those characteristics should be established by

European approvals for materials, such approvals being issued by one of the notified

bodies specifically designated for that task. The materials conforming to the European

approvals should benefit from a presumption of conformity with the essential safety

requirements of this Directive.

1 Regulation (EU) No 1025/2012 of the European Parliament and of the Council of 25 October 2012 on European standardisation, amending Council Directives 89/686/EEC and 93/15/EEC and Directives 94/9/EC, 94/25/EC, 95/16/EC, 97/23/EC, 98/34/EC, 2004/22/EC, 2007/23/EC, 2009/23/EC and 2009/105/EC of the European Parliament and of the Council and repealing Council Decision 87/95/EEC and Decision No 1673/2006/EC of the European Parliament and of the Council (OJ L 316, 14.11.2012, p. 12).

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(31) In view of the nature of the risks involved in the use of pressure equipment and

assemblies and in order to enable economic operators to demonstrate and the

competent authorities to ensure that pressure equipment or assemblies made available

on the market comply with the essential safety requirements, it is necessary to provide

for conformity assessment procedures. These procedures should be devised in the light

of the level of hazard which is inherent in the pressure equipment or assembly.

Therefore, for each category of pressure equipment there should be an adequate

procedure or a choice between different procedures of equivalent stringency. Decision

No 768/2008/EC establishes modules for conformity assessment procedures, which

include procedures from the least to the most stringent, in proportion to the level of

risk involved and the level of safety required. In order to ensure inter-sectoral

coherence and to avoid ad-hoc variants, conformity assessment procedures should be

chosen from among those modules. The details added to those procedures are justified

by the nature of the verification required for pressure equipment.

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(32) Member States should be in a position to authorise user inspectorates to carry out

certain tasks for conformity assessment in the framework of this Directive. For that

purpose this Directive should set out criteria for the authorisation of user inspectorates

by Member States.

(33) Under certain procedures for conformity assessment it should be possible for each item

to be inspected and tested by a notified body or a user inspectorate as part of the final

assessment of the pressure equipment or assembly. In other cases provision should be

made to ensure that the final assessment may be monitored by a notified body by

means of unexpected visits.

(34) Manufacturers should draw up an EU declaration of conformity to provide information

required under this Directive on the conformity of the pressure equipment or assembly

with the requirements of this Directive and of other relevant Union harmonisation

legislation.

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(35) To ensure effective access to information for market surveillance purposes, in cases

where pressure equipment or an assembly is covered by several pieces of Union

harmonisation legislation, the information required to identify all applicable Union

acts should be available in a single EU declaration of conformity. In order to reduce

the administrative burden on economic operators, that single EU declaration of

conformity may be a dossier made up of relevant individual declarations of

conformity.

(36) A check on compliance with the essential safety requirements is necessary in order

to provide effective protection for consumers, other users and third parties.

(37) Pressure equipment and assemblies should, as a general rule, bear the CE marking.

The CE marking, indicating the conformity of pressure equipment or assemblies, is the

visible consequence of a whole process comprising conformity assessment in a broad

sense. General principles governing the CE marking and its relationship to other

markings are set out in Regulation (EC) No 765/2008. Rules governing the affixing of

the CE marking should be laid down in this Directive.

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(38) For pressure equipment defined in this Directive which presents only a minor pressure

risk and for which certification procedures are therefore not justified, the CE marking

should not be affixed.

(39) Certain conformity assessment procedures set out in this Directive require the

intervention of conformity assessment bodies, which are notified by the Member States

to the Commission.

(40) Experience has shown that the criteria set out in Directive 97/23/EC that conformity

assessment bodies have to fulfil to be notified to the Commission are not sufficient to

ensure a uniformly high level of performance of those bodies throughout the Union. It

is, however, essential that all conformity assessment bodies perform their functions to

the same level and under conditions of fair competition. That requires the setting of

obligatory requirements for conformity assessment bodies wishing to be notified in

order to provide conformity assessment services.

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(41) If a conformity assessment body demonstrates conformity with the criteria laid down

in harmonised standards, it should be presumed to comply with the corresponding

requirements set out in this Directive.

(42) In order to ensure a consistent level of conformity assessment quality, it is also

necessary to set requirements for notifying authorities and other bodies involved in the

assessment, notification and monitoring of conformity assessment bodies.

(43) The system set out in this Directive should be complemented by the accreditation

system provided for in Regulation (EC) No 765/2008. Since accreditation is an

essential means of verifying the competence of conformity assessment bodies, it

should also be used for the purposes of notification.

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(44) Transparent accreditation as provided for in Regulation (EC) No 765/2008, ensuring

the necessary level of confidence in ▌ certificates of conformity, should be considered

by the national public authorities throughout the Union as the preferred means of

demonstrating the technical competence of conformity assessment bodies. However,

national authorities may consider that they possess the appropriate means of carrying

out that evaluation themselves. In such cases, in order to ensure the appropriate level

of credibility of evaluations carried out by other national authorities, they should

provide the Commission and the other Member States with the necessary documentary

evidence demonstrating the compliance of the conformity assessment bodies evaluated

with the relevant regulatory requirements.

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(45) Conformity assessment bodies frequently subcontract parts of their activities linked to

the assessment of conformity or have recourse to a subsidiary. In order to safeguard

the level of protection required for the pressure equipment or assembly to be placed on

the Union market, it is essential that conformity assessment subcontractors and

subsidiaries fulfil the same requirements as notified bodies in relation to the

performance of conformity assessment tasks. Therefore, it is important that the

assessment of the competence and the performance of bodies to be notified and the

monitoring of bodies already notified cover also activities carried out by

subcontractors and subsidiaries.

(46) It is necessary to increase the efficiency and transparency of the notification procedure

and, in particular, to adapt it to new technologies so as to enable online notification.

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(47) Since conformity assessment bodies may offer their services throughout the Union, it

is appropriate to give the other Member States and the Commission the opportunity to

raise objections concerning a notified body. It is therefore important to provide for a

period during which any doubts or concerns as to the competence of conformity

assessment bodies can be clarified before they start operating as notified bodies.

(48) In the interests of competitiveness, it is crucial that conformity assessment bodies

apply the conformity assessment procedures without creating unnecessary burdens for

economic operators. For the same reason, and to ensure equal treatment of economic

operators, consistency in the technical application of the conformity assessment

procedures needs to be ensured. That can best be achieved through appropriate

coordination and cooperation between conformity assessment bodies.

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(49) Member States should take all appropriate measures to ensure that pressure equipment

and assemblies may be placed on the market only if, when properly stored and used

for their intended purpose, or under conditions of use which can be reasonably

foreseen, they do not endanger the health and safety of persons. Pressure equipment or

assemblies should be considered as non-compliant with the essential safety

requirements laid down in this Directive only under conditions of use which can be

reasonably foreseen, that is when such use could result from lawful and readily

predictable human behaviour.

▌

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(50) In order to ensure uniform conditions for the implementation of this Directive,

implementing powers should be conferred to the Commission. Those powers should be

exercised in accordance with Regulation (EU) No 182/2011 of the European

Parliament and of the Council ▌1.

(51) The advisory procedure should be used for the adoption of implementing acts

requesting the notifying Member State to take the necessary corrective measures in

respect of notified bodies that do not meet or no longer meet the requirements for their

notification.

(52) The examination procedure should be used for the adoption of implementing acts with

respect to European approvals for materials presenting shortcomings and whose

references were already published in the Official Journal of the European Union,

given that such decisions could have consequences on the presumption of conformity

with the applicable essential requirements.

1 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).

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(53) The Commission should adopt immediately applicable implementing acts where, in

duly justified cases relating to compliant pressure equipment or assemblies which

present a risk to the health or safety of persons, to domestic animals or to property,

imperative grounds of urgency so require.

(54) In line with established practice, the committee set up by this Directive can play a

useful role in examining matters concerning the application of this Directive raised

either by its chair or by a representative of a Member State in accordance with its

rules of procedure.

(55) When matters relating to this Directive, other than its implementation or

infringements, are being examined, i.e. in a Commission expert group, the European

Parliament should in line with existing practice receive full information and

documentation and, where appropriate, an invitation to attend such meetings.

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(56) The Commission should, by means of implementing acts and, given their special

nature, acting without the application of Regulation (EU) No 182/2011, determine

whether measures taken by Member States in respect of non-compliant pressure

equipment or assemblies are justified or not.

(57) In order to take into account emerging very serious safety reasons, the power to adopt

acts in accordance with Article 290 TFEU should be delegated to the Commission in

respect of amendments to classification of pressure equipment or assemblies. The

reclassification should be based on appropriate evidence and justification in each

case. It is of particular importance that the Commission carry out appropriate

consultations during its preparatory work, including at expert level.

(58) The Commission, when preparing and drawing up delegated acts, should ensure a

simultaneous, timely and appropriate transmission of relevant documents to the

European Parliament and to the Council.

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(59) Directive 97/23/EC provides for a transitional arrangement enabling pressure

equipment and assemblies which comply with the national regulations in force on the

date of application of Directive 97/23/EC to be put into service. For reasons of legal

certainty, it is necessary to include that transitional arrangement also in this Directive.

(60) It is necessary to provide for reasonable transitional arrangements that allow the

making available on the market and the putting into service, without the need to

comply with further product requirements, of pressure equipment and assemblies

that have already been placed on the market in accordance with Directive 97/23/EC

before the date of application of national measures transposing this Directive.

Distributors should therefore be able to supply pressure equipment and assemblies

that have been placed on the market, namely stock that is already in the distribution

chain, before the date of application of national measures transposing this Directive.

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(61) Member States should lay down rules on penalties applicable to infringements of the

provisions of national law adopted pursuant to this Directive and ensure that those

rules are enforced. The penalties provided for should be effective, proportionate and

dissuasive.

(62) Since the objective of this Directive, namely to ensure that pressure equipment or

assemblies on the market fulfil the requirements providing a high level of protection of

health and safety of persons and protection of domestic animals or property while

guaranteeing the functioning of the internal market cannot be sufficiently achieved by

the Member States but can rather, by reason of its scale and effects, be better achieved

at Union level, the Union may adopt measures, in accordance with the principle of

subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance

with the principle of proportionality, as set out in that Article, this Directive does not

go beyond what is necessary in order to achieve that objective.

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(63) The obligation to transpose this Directive into national law should be confined to those

provisions which represent a substantive amendment as compared to the earlier

Directive. The obligation to transpose the provisions which are unchanged arises under

the earlier Directive ▌.

(64) This Directive should be without prejudice to the obligations of the Member States

relating to the time-limit for transposition into national law and the date of application

of the Directive ▌ set out in Annex V, Part B ▌,

HAVE ADOPTED THIS DIRECTIVE:

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CHAPTER 1

GENERAL PROVISIONS

Article 1

Scope

1. This Directive shall apply to the design, manufacture and conformity assessment of

pressure equipment and assemblies with a maximum allowable pressure PS greater

than 0,5 bar.

2. This Directive shall not apply to:

(a) pipelines comprising piping or a system of piping designed for the conveyance

of any fluid or substance to or from an installation (onshore or offshore) starting

from and including the last isolation device located within the confines of the

installation, including all the annexed equipment designed specifically for

pipelines; this exclusion shall not apply to standard pressure equipment such as

may be found in pressure reduction stations or compression stations;

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(b) networks for the supply, distribution and discharge of water and associated

equipment and headraces such as penstocks, pressure tunnels, pressure shafts for

hydroelectric installations and their related specific accessories;

(c) simple pressure vessels covered by Directive 2014/29/EU of the European

Parliament and of the Council1;

(d) aerosol dispensers covered by Council Directive 75/324/EEC2;

(e) equipment intended for the functioning of vehicles defined by the following legal

acts:

(i) Directive 2007/46/EC of the European Parliament and of the Council3 ▌;

1 Directive 2014/29/EU of the European Parliament and of the Council of 26 February 2014 on the harmonisation of the laws of the Member States relating to the making available on the market of simple pressure vessels (OJ L 96, 29.3.2014, p. 45).

2 Council Directive 75/324/EEC of 20 May 1975 on the approximation of the laws of the Member States relating to aerosol dispensers (OJ L 147, 9.6.1975, p. 40).

3 Directive 2007/46/EC of the European Parliament and of the Council of 5 September 2007 establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles (Framework Directive) (OJ L 263, 9.10.2007, p. 1).

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(ii) Regulation (EU) No 167/2013 of the European Parliament and of the

Council1 ▌;

(iii) Regulation (EU) No 168/2013 of the European Parliament and of the

Council2 ▌;

(f) equipment classified as no higher than category I under Article 13 of this

Directive and covered by one of the following Directives:

(i) Directive 2006/42/EC of the European Parliament and of the Council3 ▌;

(ii) Directive 2014/33/EU of the European Parliament and of the Council4 ▌;

1 Regulation (EU) No 167/2013 of the European Parliament and of the Council of 5 February 2013 on the approval and market surveillance of agricultural and forestry vehicles (OJ L 60, 2.3.2013, p. 1).

2 Regulation (EU) No 168/2013 of the European Parliament and of the Council of 15 January 2013 on the approval and market surveillance of two- or three-wheel vehicles and quadricycles (OJ L 60, 2.3.2013, p. 52).

3 Directive 2006/42/EC of the European Parliament and of the Council of 17 May 2006 on machinery, and amending Directive 95/16/EC (OJ L 157, 9.6.2006, p. 24).

4 Directive 2014/33/EU of the European Parliament and of the Council of 26 February 2014 on the harmonisation of the laws of the Member States relating to lifts and safety components for lifts (OJ L 96, 29.3.2014, p. 251).

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(iii) Directive 2014/35/EU of the European Parliament and of the Council1▌;

(iv) Council Directive 93/42/EEC▌2;

(v) Directive 2009/142/EC of the European Parliament and of the Council3 ▌;

(vi) Directive 2014/34/EU of the European Parliament and of the Council4 ▌;

(g) equipment covered by point (b) of Article 346(1) TFEU;

(h) items specifically designed for nuclear use, failure of which may cause an

emission of radioactivity;

1 Directive 2014/35/EU of the European Parliament and of the Council of 26 February 2014 on the harmonisation of the laws of the Member States relating to the making available on the market of electrical equipment designed for use within certain voltage limits (OJ L 96, 29.3.2014, p. 357).

2 Council Directive 93/42/EEC of 14 June 1993 concerning medical devices (OJ L 169, 12.7.1993, p. 1).

3 Directive 2009/142/EC of the European Parliament and of the Council of 30 November 2009 relating to appliances burning gaseous fuels (OJ L 330, 16.12.2009, p. 10).

4 Directive 2014/34/EU of the European Parliament and the Council of 26 February 2014 on the harmonisation of the laws of the Member States relating to equipment and protective systems intended for use in potentially explosive atmospheres (OJ L 96, 29.3.2014, p. 309).

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(i) well-control equipment used in the petroleum, gas or geothermal exploration and

extraction industry and in underground storage which is intended to contain

and/or control well pressure; this shall comprise the wellhead (Christmas tree),

the blow out preventers (BOP), the piping manifolds and all their equipment

upstream;

(j) equipment comprising casings or machinery where the dimensioning, choice of

material and manufacturing rules are based primarily on requirements for

sufficient strength, rigidity and stability to meet the static and dynamic

operational effects or other operational characteristics and for which pressure is

not a significant design factor; such equipment may include:

(i) engines including turbines and internal combustion engines;

(ii) steam engines, gas/steam turbines, turbo-generators, compressors, pumps

and actuating devices;

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(k) blast furnaces including the furnace cooling system, hot-blast recuperators, dust

extractors and blast-furnace exhaust-gas scrubbers and direct reducing cupolas,

including the furnace cooling, gas converters and pans for melting, re-melting,

de-gassing and casting of steel, iron and non-ferrous metals;

(l) enclosures for high-voltage electrical equipment such as switchgear, control

gear, transformers, and rotating machines;

(m) pressurised pipes for the containment of transmission systems, e.g. for electrical

power and telephone cables;

(n) ships, rockets, aircraft and mobile off-shore units, as well as equipment

specifically intended for installation on board or the propulsion thereof;

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(o) pressure equipment consisting of a flexible casing, e.g. tyres, air cushions, balls

used for play, inflatable craft, and other similar pressure equipment;

(p) exhaust and inlet silencers;

(q) bottles or cans for carbonated drinks for final consumption;

(r) vessels designed for the transport and distribution of drinks having a PS·V of not

more than 500 bar·L and a maximum allowable pressure not exceeding 7 bar;

(s) equipment covered by Directive 2008/68/EC and Directive 2010/35/EU and

equipment covered by the International Maritime Dangerous Goods Code and

the Convention on International Civil Aviation;

(t) radiators and pipes in warm water heating systems;

(u) vessels designed to contain liquids with a gas pressure above the liquid of not

more than 0,5 bar.

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Article 2

Definitions

For the purposes of this Directive, the following definitions shall apply:

(1) ‘pressure equipment’ means vessels, piping, safety accessories and pressure

accessories, including, where applicable, elements attached to pressurised parts, such

as flanges, nozzles, couplings, supports, lifting lugs;

(2) ‘vessel’ means a housing designed and built to contain fluids under pressure including

its direct attachments up to the coupling point connecting it to other equipment; a

vessel may be composed of more than one chamber;

(3) ‘piping’ means piping components intended for the transport of fluids, when connected

together for integration into a pressure system; piping includes in particular a pipe or

system of pipes, tubing, fittings, expansion joints, hoses, or other pressure-bearing

components as appropriate; heat exchangers consisting of pipes for the purpose of

cooling or heating air shall be considered as piping;

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(4) ‘safety accessories’ means devices designed to protect pressure equipment against the

allowable limits being exceeded, including devices for direct pressure limitation, such

as safety valves, bursting disc safety devices, buckling rods, controlled safety pressure

relief systems (CSPRS), and limiting devices, which either activate the means for

correction or provide for shutdown or shutdown and lockout, such as pressure switches

or temperature switches or fluid level switches and safety related measurement control

and regulation (SRMCR) devices;

(5) ‘pressure accessories’ means devices with an operational function and having pressure-

bearing housings;

(6) ‘assemblies’ means several pieces of pressure equipment assembled by a manufacturer

to constitute an integrated and functional whole;

(7) ‘pressure’ means pressure relative to atmospheric pressure, i.e. gauge pressure. As a

consequence, vacuum is designated by a negative value;

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(8) ‘maximum allowable pressure PS’ means the maximum pressure for which the

equipment is designed, as specified by the manufacturer, and defined at a location

specified by him, being either the connection of protective and/or limiting devices, or

the top of equipment or, if not appropriate, any point specified;

(9) ‘maximum/minimum allowable temperature TS’ means the maximum/minimum

temperatures for which the equipment is designed, as specified by the manufacturer;

(10) ‘volume (V)’ means the internal volume of a chamber, including the volume of nozzles

to the first connection or weld and excluding the volume of permanent internal parts;

(11) ‘nominal size (DN)’ means a numerical designation of size which is common to all

components in a piping system other than components indicated by outside diameters

or by thread size; it is a convenient round number for reference purposes and is only

loosely related to manufacturing dimensions; the nominal size is designated by DN

followed by a number;

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(12) ‘fluids’ means gases, liquids and vapours in pure phase as well as mixtures thereof;

fluids may contain a suspension of solids;

(13) ‘permanent joints’ means joints which cannot be disconnected except by destructive

methods;

(14) ‘European approval for materials’ means a technical document defining the

characteristics of materials intended for repeated use in the manufacture of pressure

equipment which are not covered by any harmonised standard;

(15) ‘making available on the market’ means any supply of pressure equipment or

assemblies for distribution or use on the Union market in the course of a commercial

activity, whether in return for payment or free of charge;

(16) ‘placing on the market’ means the first making available of pressure equipment or

assemblies on the Union market;

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(17) 'putting into service' means the first use of pressure equipment or an assembly by its

user;

(18) ‘manufacturer’ means any natural or legal person who manufactures pressure

equipment or an assembly or has such equipment or assembly designed or

manufactured, and markets that pressure equipment or assembly under his name or

trademark or uses it for his own purposes;

(19) ‘authorised representative’ means any natural or legal person established within the

Union who has received a written mandate from a manufacturer to act on his behalf in

relation to specified tasks;

(20) ‘importer’ means any natural or legal person established within the Union who places

pressure equipment or assemblies from a third country on the Union market;

(21) ‘distributor’ means any natural or legal person in the supply chain, other than the

manufacturer or the importer, who makes pressure equipment or assemblies available

on the market;

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(22) ‘economic operators’ means the manufacturer, the authorised representative, the

importer and the distributor;

(23) ‘technical specification’ means a document that prescribes technical requirements to be

fulfilled by pressure equipment or assemblies;

(24) ‘harmonised standard’ means harmonised standard as defined in point (c) of Article

2(1) of Regulation (EU) No 1025/2012;

(25) ‘accreditation’ means accreditation as defined in point 10 of Article 2 ▌ of Regulation

(EC) No 765/2008;

(26) ‘national accreditation body’ means national accreditation body as defined in point 11

of Article 2 ▌ of Regulation (EC) No 765/2008;

(27) ‘conformity assessment’ means the process demonstrating whether the essential safety

requirements of this Directive relating to pressure equipment or assemblies have been

fulfilled;

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(28) ‘conformity assessment body’ means a body that performs conformity assessment

activities including calibration, testing, certification and inspection;

(29) ‘recall’ means any measure aimed at achieving the return of pressure equipment or

assemblies that have already been made available to consumers or other users;

(30) ‘withdrawal’ means any measure aimed at preventing pressure equipment or

assemblies in the supply chain from being made available on the market;

(31) ‘CE marking’ means a marking by which the manufacturer indicates that the pressure

equipment ▌ or assembly is in conformity with the applicable requirements set out in

Union harmonisation legislation providing for its affixing;

(32) ‘Union harmonisation legislation’ means any Union legislation harmonising the

conditions for the marketing of products.

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Article 3

Making available on the market and putting into service

1. Member States shall take all appropriate measures to ensure that pressure equipment

and assemblies may be made available on the market and put into service only if they

satisfy the requirements of this Directive when properly installed and maintained and

used for the purposes for which they are intended.

2. This Directive shall not affect Member States' entitlement to lay down such

requirements as they may deem necessary to ensure that persons and, in particular,

workers are protected during use of the pressure equipment or assembly in question

provided that this does not mean modifications to such equipment or assembly in a

way not specified in this Directive.

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3. At trade fairs, exhibitions, demonstrations and other similar events, Member States

shall not prevent the showing of pressure equipment or assemblies which do not

comply with this Directive, provided that a visible sign clearly indicates that such

pressure equipment or assemblies may not be made available on the market and/or

put into service until they are brought into conformity ▌. During demonstrations,

appropriate safety measures shall be taken in accordance with any requirements laid

down by the competent authority of the Member State concerned in order to ensure the

safety of persons.

Article 4

Technical requirements

1. The following pressure equipment shall satisfy the essential safety requirements set

out in Annex I:

(a) vessels, except those referred to in point (b), for:

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(i) gases, liquefied gases, gases dissolved under pressure, vapours and also

those liquids whose vapour pressure at the maximum allowable

temperature is greater than 0,5 bar above normal atmospheric pressure

(1 013 mbar) within the following limits:

– for fluids in Group 1 with a volume greater than 1 L and a product of

PS and V greater than 25 bar·L, or with a pressure PS greater than

200 bar (Annex II, table 1);

– for fluids in Group 2, with a volume greater than 1 L and a product

of PS and V is greater than 50 bar·L, or with a pressure PS greater

than 1 000 bar, and all portable extinguishers and bottles for

breathing apparatus (Annex II, table 2);

(ii) liquids having a vapour pressure at the maximum allowable temperature of

not more than 0,5 bar above normal atmospheric pressure (1 013 mbar)

within the following limits:

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– for fluids in Group 1 with a volume greater than 1 L and a product of

PS and V greater than 200 bar·L, or with a pressure PS greater than

500 bar (Annex II, table 3);

– for fluids in Group 2 with a pressure PS greater than 10 bar and a

product of PS and V greater than 10 000 bar·L, or with a pressure PS

greater than 1 000 bar (Annex II, table 4);

(b) fired or otherwise heated pressure equipment with the risk of overheating

intended for generation of steam or super-heated water at temperatures higher

than 110 °C having a volume greater than 2 L, and all pressure cookers (Annex

II, table 5);

(c) piping intended for:

(i) gases, liquefied gases, gases dissolved under pressure, vapours and those

liquids whose vapour pressure at the maximum allowable temperature is

greater than 0,5 bar above normal atmospheric pressure (1 013 mbar)

within the following limits:

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– for fluids in Group 1 with a DN greater than 25 (Annex II, table 6);

– for fluids in Group 2 with a DN greater than 32 and a product of PS

and DN greater than 1 000 bar (Annex II, table 7);

(ii) liquids having a vapour pressure at the maximum allowable temperature of

not more than 0,5 bar above normal atmospheric pressure (1 013 mbar)

within the following limits:

– for fluids in Group 1 with a DN greater than 25 and a product of PS

and DN greater than 2 000 bar (Annex II, table 8);

– for fluids in Group 2 with a PS greater than 10 bar, a DN greater than

200 and a product of PS and DN greater than 5 000 bar (Annex II,

table 9).

(d) safety and pressure accessories intended for equipment covered by points (a),

(b), and (c) including where such equipment is incorporated into an assembly.

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2. The following assemblies which include at least one item of pressure equipment

covered by paragraph 1 shall satisfy the essential safety requirements set out in Annex

I:

(a) assemblies intended for generating steam or superheated water at a temperature

higher than 110 °C comprising at least one item of fired or otherwise heated

pressure equipment presenting a risk of overheating;

(b) assemblies other than those referred to in point (a), if the manufacturer intends

them to be made available on the market and put into service as assemblies.

By way of derogation from the first subparagraph, assemblies intended for generating

warm water at temperatures not greater than 110 °C which are manually fed with solid

fuels and have a PS·V greater than 50 bar·L shall comply with the essential safety

requirements referred to in points 2.10, 2.11, 3.4, 5 (a) and 5 (d) of Annex I.

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3. Pressure equipment and assemblies below or equal to the limits set out in points (a),

(b) and (c) of paragraph 1 and in paragraph 2 respectively shall be designed and

manufactured in accordance with the sound engineering practice of a Member State in

order to ensure safe use. Pressure equipment and assemblies shall be accompanied by

adequate instructions for use.

Without prejudice to other applicable Union harmonisation legislation providing for

its affixing, such equipment or assemblies shall not bear the CE marking referred to in

Article 18.

Article 5

Free movement

1. Member States shall not, on grounds of the risks due to pressure, prohibit, restrict or

impede the making available on the market or the putting into service under the

conditions specified by the manufacturer of pressure equipment or assemblies which

comply with this Directive.

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Member States shall not, on grounds of the risks due to pressure, prohibit, restrict or

impede the making available on the market or the putting into service of pressure

equipment or assemblies which comply with Article 4(3).

2. When a Member State has designated a user inspectorate in accordance with the

requirements set out in Article 25, it may not, on grounds of the risks due to pressure,

prohibit, restrict or impede the placing on the market or putting into service under the

conditions provided for in Article 16, of pressure equipment or assemblies the

conformity of which has been assessed by a user inspectorate designated by another

Member State in accordance with the requirements set out in Article 25.

3. Member States may require, to the extent that it is needed for safe and correct use of

pressure equipment and assemblies, the information referred to in points 3.3 and 3.4 of

Annex I to be provided in the official language(s) of the Union which may be

determined by the Member State in which the equipment or assembly is made

available on the market.

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CHAPTER 2

OBLIGATIONS OF ECONOMIC OPERATORS

Article 6

Obligations of manufacturers

1. When placing their pressure equipment or assemblies referred to in Article 4(1) and

(2) on the market or using them for their own purposes, manufacturers shall ensure

that they have been designed and manufactured in accordance with the essential safety

requirements set out in Annex I.

When placing their pressure equipment or assemblies referred to in Article 4(3) on the

market or using them for their own purposes, manufacturers shall ensure that they

have been designed and manufactured in accordance with the sound engineering

practice of a Member State.

2. For the pressure equipment or assemblies referred to in Article 4(1) and (2),

manufacturers shall draw up the technical documentation referred to in Annex III and

carry out the relevant conformity assessment procedure referred to in Article 14 or

have it carried out.

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Where compliance of the pressure equipment or assemblies referred to in Article 4(1)

and (2) with the applicable requirements has been demonstrated by the procedure

referred to in the first subparagraph of this paragraph, manufacturers shall draw up an

EU declaration of conformity and affix the CE marking.

3. Manufacturers shall keep the technical documentation and the EU declaration of

conformity for 10 years after pressure equipment or assemblies have been placed on

the market.

4. Manufacturers shall ensure that procedures are in place for series production to remain

in conformity with this Directive. Changes in ▌ design or characteristics of pressure

equipment or assemblies and changes in the harmonised standards or in other

technical specifications by reference to which conformity of pressure equipment or

assemblies is declared shall be adequately taken into account.

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When deemed appropriate with regard to the risks presented by pressure equipment or

assemblies, manufacturers shall, to protect the health and safety of consumers and

other users, carry out sample testing of pressure equipment or assemblies made

available on the market, investigate, and, if necessary, keep a register of complaints of

non-conforming pressure equipment and assemblies and recalls of such equipment,

and shall keep distributors informed of any such monitoring.

5. Manufacturers shall ensure that their pressure equipment or assemblies bear a type,

batch or serial number or other element allowing their identification, or, where the size

or nature of the equipment or assembly does not allow it, that the required information

is provided on the packaging or in a document accompanying the equipment.

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6. Manufacturers shall indicate on the pressure equipment or assembly their name,

registered trade name or registered trade mark and the postal address ▌ at which they

can be contacted ▌ or, where that is not possible, on the packaging or in a document

accompanying the equipment or assembly. The address shall indicate a single point at

which the manufacturer can be contacted. The contact details shall be in a language

easily understood by consumers, other users and market surveillance authorities.

7. Manufacturers shall ensure that the pressure equipment or assemblies referred to in

Article 4(1) and (2) is accompanied by instructions and safety information in

accordance with points 3.3 and 3.4 of Annex I, in a language which can be easily

understood by consumers and other users, as determined by the Member State

concerned. Such instructions and safety information shall be clear, understandable and

intelligible.

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Manufacturers shall ensure that the pressure equipment or assemblies referred to in

Article 4(3) are accompanied by instructions and safety information in accordance with

Article 4(3), in a language which can be easily understood by consumers and other

users, as determined by the Member State concerned. Such instructions and safety

information shall be clear, understandable and intelligible.

8. Manufacturers who consider or have reason to believe that pressure equipment or

assemblies which they have placed on the market are not in conformity with this

Directive shall immediately take the ▌corrective measures necessary to bring that

pressure equipment or those assemblies into conformity, to withdraw it or recall it, if

appropriate. Furthermore, where pressure equipment or assemblies present a risk,

manufacturers shall immediately inform the competent national authorities of the

Member States in which they made that pressure equipment or those assemblies

available on the market to that effect, giving details, in particular, of the non-

compliance and of any corrective measures taken.

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9. Manufacturers shall, further to a reasoned request from a competent national authority,

provide it with all the information and documentation necessary to demonstrate the

conformity of the pressure equipment or assembly with this Directive, in a language

which can be easily understood by that authority. That information and documentation

may be provided in paper or electronic form. They shall cooperate with that authority,

at its request, on any action taken to eliminate the risks posed by the pressure

equipment or assembly which they have placed on the market.

Article 7

Authorised representatives

1. A manufacturer may, by a written mandate, appoint an authorised representative.

The obligations laid down in Article 6(1) and the obligation to draw up technical

documentation referred to in Article 6(2) shall not form part of the authorised

representative's mandate.

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2. An authorised representative shall perform the tasks specified in the mandate received

from the manufacturer. The mandate shall allow the authorised representative to do at

least the following:

(a) keep the EU declaration of conformity and the technical documentation at the

disposal of national market surveillance authorities for 10 years after the

pressure equipment or assembly has been placed on the market;

(b) further to a reasoned request from a competent national authority, provide that

authority with all the information and documentation necessary to demonstrate

the conformity of the pressure equipment or assembly;

(c) cooperate with the competent national authorities, at their request, on any action

taken to eliminate the risks posed by the pressure equipment or assembly

covered by the authorised representative’s mandate.

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Article 8

Obligations of importers

1. Importers shall place only compliant pressure equipment or assemblies on the market.

2. Before placing on the market the pressure equipment or assemblies referred to in

Article 4(1) and (2), importers shall ensure that the appropriate conformity assessment

procedure in accordance with Article 14 has been carried out by the manufacturer.

They shall ensure that the manufacturer has drawn up the technical documentation, that

pressure equipment or assemblies bear the CE marking and are accompanied by

instructions and safety information in accordance with points 3.3 and 3.4 of Annex I,

and that the manufacturer has complied with the requirements set out in Article 6(5)

and (6).

Before placing on the market the pressure equipment or assemblies referred to in

Article 4(3), importers shall ensure that the manufacturer has drawn up the technical

documentation and that pressure equipment or assemblies are accompanied by

adequate instructions for use and that the manufacturer has complied with the

requirements set out in Article 6(5) and (6).

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Where an importer considers or has reason to believe that the pressure equipment or

assembly is not in conformity with the essential safety requirements set out in Annex I,

he shall not place the pressure equipment or assembly on the market until it has been

brought into conformity. Furthermore, where the pressure equipment or assembly

presents a risk, the importer shall inform the manufacturer and the market surveillance

authorities to that effect.

3. Importers shall indicate their name, registered trade name or registered trade mark and

the postal address at which they can be contacted on the pressure equipment or

assembly, or, where that is not possible, on its packaging or in a document

accompanying the equipment or assembly. The contact details shall be in a language

easily understood by consumers, other users and market surveillance authorities.

4. Importers shall ensure that pressure equipment or assemblies referred to in Article 4(1)

and (2) are accompanied by instructions and safety information in accordance with

points 3.3 and 3.4 of Annex I, in a language which can be easily understood by

consumers and other users, as determined by the Member State concerned.

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Importers shall ensure that the pressure equipment or assembly referred to in Article

4(3) is accompanied by instructions and safety information in a language which can be

easily understood by consumers and other users, as determined by the Member State

concerned.

5. Importers shall ensure that, while pressure equipment or assemblies referred to in

Article 4(1) and (2) are under their responsibility, storage or transport conditions do

not jeopardise their compliance with the essential safety requirements set out in Annex

I.

6. When deemed appropriate with regard to the risks presented by pressure equipment or

assemblies, importers shall, to protect the health and safety of consumers and other

users, ▌carry out sample testing of pressure equipment and assemblies made available

on the market, investigate, and, if necessary, keep a register of complaints, of non-

conforming pressure equipment or assemblies and recalls of such equipment, and shall

keep distributors informed of any such monitoring.

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7. Importers who consider or have reason to believe that pressure equipment or

assemblies which they have placed on the market are not in conformity with this

Directive shall immediately take the corrective measures necessary to bring that

pressure equipment or assembly into conformity, to withdraw it or recall it, if

appropriate. Furthermore, where the pressure equipment or assembly presents a risk,

importers shall immediately inform the competent national authorities of the Member

States in which they made the pressure equipment or assembly available on the market

to that effect, giving details, in particular, of the non-compliance and of any corrective

measures taken.

8. Importers shall, for 10 years after the pressure equipment or assembly has been placed

on the market, keep a copy of the EU declaration of conformity at the disposal of the

market surveillance authorities and ensure that the technical documentation can be

made available to those authorities, upon request.

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9. Importers shall, further to a reasoned request from a competent national authority,

provide it with all the information and documentation necessary to demonstrate the

conformity of pressure equipment or an assembly in a language which can be easily

understood by that authority. That information and documentation may be provided in

paper or electronic form. They shall cooperate with that authority, at its request, on any

action taken to eliminate the risks posed by pressure equipment or an assembly which

they have placed on the market.

Article 9

Obligations of distributors

1. When making pressure equipment or assemblies available on the market distributors

shall act with due care in relation to the requirements of this Directive.

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2. Before making the pressure equipment or assemblies referred to in Article 4(1) and (2)

available on the market distributors shall verify that the pressure equipment or

assembly bears the CE marking, that it is accompanied by the required documents and

by instructions and safety information in accordance with points 3.3 and 3.4 of Annex

I, in a language which can be easily understood by consumers and other users in the

Member State in which the pressure equipment or assembly is to be made available on

the market, and that the manufacturer and the importer have complied with the

requirements set out in Article 6(5) and (6) and Article 8(3) respectively.

Where a distributor considers or has reason to believe that pressure equipment or

assemblies are not in conformity with the essential safety requirements set out in

Annex I, he shall not make the pressure equipment or assembly available on the

market until it has been brought into conformity. Furthermore, where the pressure

equipment or assembly presents a risk, the distributor shall inform the manufacturer or

the importer to that effect as well as the market surveillance authorities.

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Before making the pressure equipment or assembly referred to in Article 4(3) available

on the market, distributors shall verify that that pressure equipment or assembly is

accompanied by adequate instructions for use, in a language which can be easily

understood by consumers and other users in the Member State in which that pressure

equipment or assembly is to be made available on the market, and that the

manufacturer and the importer have complied with the requirements set out in Article

6(5) and (6) and Article 8(3) respectively.

3. Distributors shall ensure that, while the pressure equipment or assemblies referred to

in Article 4(1) and (2) are under their responsibility, storage or transport conditions do

not jeopardise their ▌ compliance with the essential safety requirements set out in

Annex I.

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4. Distributors who consider or have reason to believe that pressure equipment or

assemblies which they have made available on the market are not in conformity with

this Directive shall make sure that the corrective measures necessary to bring that

equipment or assembly into conformity, to withdraw it or recall it, if appropriate, are

taken. Furthermore, where the pressure equipment or assembly presents a risk,

distributors shall immediately inform the competent national authorities of the Member

States in which they made the equipment or assembly available on the market to that

effect, giving details, in particular, of the non-compliance and of any corrective

measures taken.

5. Distributors shall, further to a reasoned request from a competent national authority,

provide it with all the information and documentation necessary to demonstrate the

conformity of pressure equipment or assemblies. That information and documentation

may be provided in paper or electronic form. They shall cooperate with that authority,

at its request, on any action taken to eliminate the risks posed by the pressure

equipment or assemblies which they have made available on the market.

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Article 10

Cases in which obligations of manufacturers apply to importers and distributors

An importer or distributor shall be considered a manufacturer for the purposes of this Directive

and he shall be subject to the obligations of the manufacturer under Article 6, where he places

pressure equipment or an assembly on the market under his name or trademark or modifies

pressure equipment or an assembly already placed on the market in such a way that compliance

with the requirements of this Directive may be affected.

Article 11

Identification of economic operators

Economic operators shall, on request, identify the following to the market surveillance

authorities ▌:

(a) any economic operator who has supplied them with pressure equipment or an

assembly;

(b) any economic operator to whom they have supplied pressure equipment or an

assembly.

Economic operators shall be able to present the information referred to in the first paragraph for

10 years after they have been supplied with the pressure equipment or assembly and for 10

years after they have supplied the pressure equipment or assembly.

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CHAPTER 3

CONFORMITY AND CLASSIFICATION OF PRESSURE EQUIPMENT AND

ASSEMBLIES

Article 12

Presumption of conformity

1. Pressure equipment or assemblies referred to in Article 4(1) and (2) which are in

conformity with harmonised standards or parts thereof the references of which have been

published in the Official Journal of the European Union shall be presumed to be in

conformity with the essential safety requirements covered by those standards or parts

thereof, referred to in Annex I.

▌

2. The materials used for the manufacture of pressure equipment or assemblies which are

in conformity with European approvals for materials, the references of which have

been published in the Official Journal of the European Union in accordance with

Article 15(4), shall be presumed to be in conformity with the applicable essential

safety requirements set out in Annex I.

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Article 13

Classification of pressure equipment

1. Pressure equipment referred to in Article 4(1) shall be classified by category in

accordance with Annex II, according to an ascending level of hazard.

For the purposes of such classification fluids shall be divided into the following two

groups:

(a) group 1 ▌ consisting of substances and mixtures, as defined in points (7) and (8)

of Article 2 of Regulation (EC) No 1272/2008, that are classified as hazardous in

accordance with the following physical or health hazard classes laid down in

Parts 2 and 3 of Annex I to that Regulation:

(i) unstable explosives or explosives of Divisions 1.1, 1.2, 1.3, 1.4 and 1.5;

(ii) flammable gases, category 1 and 2;

(iii) oxidising gases, category 1;

(iv) flammable liquids, category 1 and 2;

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(v) flammable liquids, category 3 where the maximum allowable temperature

is above the flashpoint;

(vi) flammable solids, category 1 and 2;

(vii) self-reactive substances and mixtures, type A to F;

(viii) pyrophoric liquids, category 1;

(ix) pyrophoric solids, category 1;

(x) substances and mixtures which in contact with water emit flammable

gases, category 1, 2 and 3;

(xi) oxidising liquids, category 1, 2 and 3;

(xii) oxidising solids, category 1, 2 and 3;

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(xiii) organic peroxides types A to F;

(xiv) acute oral toxicity, category 1 and 2;

(xv) acute dermal toxicity, category 1 and 2;

(xvi) acute inhalation toxicity, category 1, 2 and 3;

(xvii) specific target organ toxicity – single exposure, category 1.

Group 1 comprises also substances and mixtures contained in pressure

equipment with a maximum allowable temperature TS which exceeds the

flashpoint of the fluid;

(b) group 2 consisting of substances and mixtures not referred to in point (a).

2. Where a vessel is composed of a number of chambers, it shall be classified in the

highest category applicable to the individual chambers. Where a chamber contains

several fluids, classification shall be on the basis of the fluid which requires the highest

category.

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Article 14

Conformity assessment procedures

1. The conformity assessment procedures to be applied to an item of pressure equipment

shall be determined by the category, as set out in Article 13, in which the equipment is

classified.

2. The conformity assessment procedures to be applied for the various categories are the

following:

(a) category I:

– Module A

(b) category II:

– Module A2

– Module D1

– Module E1

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(c) category III:

– Modules B (design type) + D

– Modules B (design type) + F

– Modules B (▌ production type ▌) + E

– Modules B (▌ production type ▌) + C2

– Module H

(d) category IV:

– Modules B (▌ production type ▌) + D

– Modules B (▌ production type ▌) + F

– Module G

– Module H1

The conformity assessment procedures are set out in Annex III.

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3. Pressure equipment shall be subject to one of the conformity assessment procedures

which may be chosen by the manufacturer among those laid down for the category in

which it is classified. The manufacturer may also choose to apply one of the

procedures which apply to a higher category, if available.

4. In the framework of quality assurance procedures for pressure equipment in categories

III and IV referred to in point (i) of point (a) of Article 4(1), first indent of point (ii) of

point (a) of Article 4(1) and point (b) of Article 4(1), the notified body shall, when

performing unexpected visits, take a sample of equipment from the manufacturing or

storage premises in order to perform, or have performed, the final assessment as

referred to in Annex I, point 3.2. To this end, the manufacturer shall inform the

notified body of the intended schedule of production. The notified body shall carry out

at least two visits during the first year of manufacturing. The frequency of subsequent

visits shall be determined by the notified body on the basis of the criteria set out in

point 4.4 of modules D, E and H and point 5.4 of module H1.

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5. In the case of one-off production of vessels and pressure equipment in category III

referred to in point (b) of Article 4(1) under the module H procedure, the notified body

shall perform or have performed the final assessment, as referred to in point 3.2 ▌ of

Annex I, for each unit. To this end, the manufacturer shall communicate the intended

schedule of production to the notified body.

6. Assemblies referred to in Article 4(2) shall be subject to a global conformity

assessment procedure comprising the following assessments:

(a) the assessment of each item of pressure equipment making up the assembly and

referred to in Article 4(1) which has not been previously subjected to a

conformity assessment procedure and to a separate CE marking; the assessment

procedure shall be determined by the category of each item of equipment;

(b) the assessment of the integration of the various components of the assembly as

referred to in points 2.3, 2.8 and 2.9 of Annex I which shall be determined by the

highest category applicable to the equipment concerned other than that

applicable to any safety accessories;

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(c) the assessment of the protection of an assembly against exceeding the

permissible operating limits as referred to in points 2.10 and 3.2.3 of Annex I

shall be conducted in the light of the highest category applicable to the items of

equipment to be protected.

7. By way of derogation from paragraphs 1 and 2 of this Article, the competent

authorities may, where justified, allow the making available on the market and putting

into service in the territory of the Member State concerned of individual pressure

equipment items and assemblies referred to in Article 2, in respect of which the

procedures referred to in paragraphs 1 and 2 of this Article have not been applied and

the use of which is in the interests of experimentation.

8. The records and correspondence relating to conformity assessment procedures shall be

drafted in an official language ▌ of the ▌ Member State where the body responsible

for carrying out these conformity assessment procedures is established, or in a

language accepted by that body.

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Article 15

European approval for materials

1. European approval for materials shall be issued at the request of one or more

manufacturers of materials or equipment, by one of the notified bodies referred to in

Article 20 specifically designated for that task. The notified body shall determine and

perform, or arrange for the performance of, the appropriate inspections and tests to

certify the conformity of the types of material with the corresponding requirements of

this Directive. In the case of materials recognised as being safe to use before 29

November 1999, the notified body shall take account of the existing data when

certifying such conformity.

2. Before issuing a European approval for materials, the notified body shall notify the

Member States and the Commission by sending them the appropriate information.

Within three months, a Member State or the Commission may provide comments

giving its reasons. The notified body may issue the European approval for materials

taking into account the comments submitted.

3. A copy of the European approval for materials shall be sent to the Member States, the

notified bodies and the Commission.

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4. When the European approval for materials satisfies the requirements which it covers

and which are set out in Annex I, the Commission shall publish the references of that

approval. The Commission shall keep up to date a list of such approvals in the Official

Journal of the European Union.

5. The notified body which issued the European approval for materials shall withdraw

that approval if it finds that it should not have been issued or if the type of materials is

covered by a harmonised standard. It shall immediately inform the other Member

States, the notified bodies and the Commission of any withdrawal of an approval.

6. When a Member State or the Commission considers that a European approval for

materials whose references have been published in the Official Journal of the

European Union, does not entirely satisfy the essential safety requirements which it

covers and which are set out in Annex I, the Commission shall decide by means of

implementing acts whether to withdraw the references of that European approval for

materials from the Official Journal of the European Union.

The implementing acts referred to in the first subparagraph of this paragraph shall be

adopted in accordance with the examination procedure referred to in Article 44(3).

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Article 16

User inspectorates

1. By way of derogation from the provisions relating to the tasks carried out by the

notified bodies, Member States may authorise on their territory the placing on the

market ▌ and the putting into service by users, of pressure equipment or assemblies of

which conformity with the essential safety requirements has been assessed by a user

inspectorate designated in accordance with paragraph 7.

2. Pressure equipment and assemblies the conformity of which has been assessed by a

user inspectorate shall not bear the CE marking.

3. The pressure equipment or assemblies referred to in paragraph 1 may be used only in

establishments operated by the group of which the inspectorate is part. The group shall

apply a common safety policy as regards the technical specifications for the design,

manufacture, inspection, maintenance and use of pressure equipment and assemblies.

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4. The user inspectorates shall act exclusively for the group of which they are part.

5. The conformity assessment procedures applicable by user inspectorates shall be

modules A2, C2, F and G, set out in Annex III.

6. Member States shall notify the other Member States and the Commission which user

inspectorates they have authorised, the tasks for which they have been designated and,

for each inspectorate, a list of the establishments satisfying the provisions of paragraph

3.

7. In designating the user inspectorates, the Member States shall apply the requirements

set out in Article 25 and ensure that the group of which the inspectorate is part applies

the criteria referred to in the second sentence of paragraph 3 of this Article.

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Article 17

EU declaration of conformity

1. The EU declaration of conformity shall state that the fulfilment of essential safety

requirements set out in Annex I has been demonstrated.

2. The EU declaration of conformity shall have the model structure set out in Annex IV

and shall contain the elements specified in the relevant conformity assessment

procedures set out in Annex III and shall be continuously updated. It shall be

translated into the language or languages required by the Member State in whose

market the pressure equipment or assembly is placed or made available on the market.

3. Where pressure equipment or an assembly is subject to more than one Union act

requiring an EU declaration of conformity, a single EU declaration of conformity shall

be drawn up in respect of all such Union acts. That declaration shall contain the

identification of the Union acts concerned including their publication references.

4. By drawing up the EU declaration of conformity, the manufacturer shall assume

responsibility for the compliance of the pressure equipment or assembly with the

requirements laid down in this Directive.

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Article 18

General principles of the CE marking

The CE marking shall be subject to the general principles set out in Article 30 of Regulation

(EC) No 765/2008.

Article 19

Rules and conditions for affixing the CE marking

1. The CE marking shall be affixed visibly, legibly and indelibly to any of the following:

(a) each item of pressure equipment referred to in Article 4(1) or its dataplate;

(b) each assembly referred to in Article 4(2) or its dataplate.

Where the affixing of the CE marking is not possible or not warranted on account of

the nature of the equipment or assembly, it shall be affixed to the packaging and to the

accompanying documents.

The item or assembly referred to in points (a) and (b) of the first subparagraph shall be

complete or shall be in a state permitting final assessment as described in point 3.2 of

Annex I.

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2. It is not necessary for the CE marking to be affixed to each individual item of pressure

equipment making up an assembly. Individual items of pressure equipment already

bearing the CE marking when incorporated into the assembly shall continue to bear

that marking.

3. The CE marking shall be affixed before the item of pressure equipment or the

assembly is placed on the market.

4. The CE marking shall be followed by the identification number of the notified body,

where that body is involved in the production control phase.

The identification number of the notified body shall be affixed by the body itself or,

under its instructions, by the manufacturer or his authorised representative.

5. The CE marking and, where applicable, the identification number referred to in

paragraph 4 may be followed by any other mark indicating a special risk or use.

6. Member States shall build upon existing mechanisms to ensure correct application

of the regime governing the CE marking and shall take appropriate action in the

event of improper use of that marking.

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CHAPTER 4

NOTIFICATION OF CONFORMITY ASSESSMENT BODIES

Article 20

Notification

Member States shall notify the Commission and the other Member States of the notified bodies

and the user inspectorates authorised to carry out ▌ conformity assessment tasks in accordance

with Article 14, Article 15 or Article 16 ▌ and of the third-party organisations they have

recognised, for the purposes of the tasks referred to in points 3.1.2 and 3.1.3 of Annex I.

Article 21

Notifying authorities

1. Member States shall designate a notifying authority that shall be responsible for setting

up and carrying out the necessary procedures for the assessment and notification of

conformity assessment bodies and the monitoring of notified bodies, recognised third-

party organisations and user inspectorates, including compliance with Article 27.

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2. Member States may decide that the assessment and monitoring referred to in paragraph

1 shall be carried out by a national accreditation body within the meaning of and in

accordance with Regulation (EC) No 765/2008.

3. Where the notifying authority delegates or otherwise entrusts the assessment,

notification or monitoring referred to in paragraph 1 to a body which is not a

governmental entity, that body shall be a legal entity and shall comply mutatis

mutandis with the requirements laid down in Article 22 ▌. In addition it shall have

arrangements to cover liabilities arising out of its activities.

4. The notifying authority shall take full responsibility for the tasks performed by the

body referred to in paragraph 3.

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Article 22

Requirements relating to notifying authorities

1. A notifying authority shall be established in such a way that no conflict of interest with

conformity assessment bodies occurs.

2. A notifying authority shall be organised and operated so as to safeguard the objectivity

and impartiality of its activities.

3. A notifying authority shall be organised in such a way that each decision relating to

notification of a conformity assessment body is taken by competent persons different

from those who carried out the assessment.

4. A notifying authority shall not offer or provide any activities that conformity

assessment bodies perform or consultancy services on a commercial or competitive

basis.

5. A notifying authority shall safeguard the confidentiality of the information it obtains.

6. A notifying authority shall have a sufficient number of competent personnel at its

disposal for the proper performance of its tasks.

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Article 23

Information obligation on notifying authorities

Member States shall inform the Commission of their procedures for the assessment and

notification of conformity assessment bodies and the monitoring of notified bodies, recognised

third-party organisations and user inspectorates, and of any changes thereto.

The Commission shall make that information publicly available.

Article 24

Requirements relating to notified bodies and recognised third-party organisations

1. For the purposes of notification, a notified body or recognised third party organisation

shall meet the requirements laid down in paragraphs 2 to 11.

2. A conformity assessment body shall be established under national law of a Member

State and have legal personality.

3. A conformity assessment body shall be a third-party body independent of the

organisation or the pressure equipment or assembly it assesses.

375

A body belonging to a business association or professional federation representing

undertakings involved in the design, manufacturing, provision, assembly, use or

maintenance of pressure equipment or assemblies which it assesses, may, on condition

that its independence and the absence of any conflict of interest are demonstrated, be

considered such a body.

4. A conformity assessment body, its top level management and the personnel

responsible for carrying out the conformity assessment tasks shall not be the designer,

manufacturer, supplier, installer, purchaser, owner, user or maintainer of the pressure

equipment or assembly which they assess, nor the representative of any of those

parties. This shall not preclude the use of assessed pressure equipment or assemblies

that are necessary for the operations of the conformity assessment body or the use of

such equipment for personal purposes.

376

A conformity assessment body, its top level management and the personnel

responsible for carrying out the conformity assessment tasks shall not be directly

involved in the design, manufacture or construction, the marketing, installation, use or

maintenance of that pressure equipment or assembly, or represent the parties engaged

in those activities. They shall not engage in any activity that may conflict with their

independence of judgement or integrity in relation to conformity assessment activities

for which they are notified. This shall in particular apply to consultancy services.

Conformity assessment bodies shall ensure that the activities of their subsidiaries or

subcontractors do not affect the confidentiality, objectivity or impartiality of their

conformity assessment activities.

5. Conformity assessment bodies and their personnel shall carry out the conformity

assessment activities with the highest degree of professional integrity and the requisite

technical competence in the specific field and shall be free from all pressures and

inducements, particularly financial, which might influence their judgement or the

results of their conformity assessment activities, especially as regards persons or

groups of persons with an interest in the results of those activities.

377

6. A conformity assessment body shall be capable of carrying out all the conformity

assessment tasks assigned to it by Article 14 or Article 15, ▌ or points 3.1.2 and 3.1.3

of Annex I and in relation to which it has been notified, whether those tasks are carried

out by the conformity assessment body itself or on its behalf and under its

responsibility.

At all times and for each conformity assessment procedure and each kind or category

of pressure equipment in relation to which it has been notified, a conformity

assessment body shall have at its disposal the necessary:

(a) personnel with technical knowledge and sufficient and appropriate experience to

perform the conformity assessment tasks;

(b) descriptions of procedures in accordance with which conformity assessment is

carried out, ensuring the transparency and the ability of reproduction of those

procedures. It shall have appropriate policies and procedures in place that

distinguish between tasks it carries out as a conformity assessement body and

other activities;

(c) procedures for the performance of activities which take due account of the size

of an undertaking, the sector in which it operates, its structure, the degree of

complexity of the product technology in question and the mass or serial nature of

the production process.

378

A conformity assessment body shall have the means necessary to perform the technical

and administrative tasks connected with the conformity assessment activities in an

appropriate manner and shall have access to all necessary equipment or facilities.

7. The personnel responsible for carrying out conformity assessment tasks shall have the

following:

(a) sound technical and vocational training covering all the conformity assessment

activities in relation to which the conformity assessment body has been notified;

(b) satisfactory knowledge of the requirements of the assessments they carry out and

adequate authority to carry out those assessments;

(c) appropriate knowledge and understanding of the essential safety requirements set

out in Annex I, of the applicable harmonised standards and of the relevant

provisions of Union harmonisation legislation and of national legislation;

(d) the ability to draw up certificates, records and reports demonstrating that

assessments have been carried out.

379

8. The impartiality of the conformity assessment bodies, their top level management and

of the personnel responsible for carrying out the conformity assessment tasks shall be

guaranteed.

The remuneration of the top level management and personnel responsible for carrying

out the conformity assessment tasks of a conformity assessment body shall not depend

on the number of assessments carried out or on the results of those assessments.

9. Conformity assessment bodies shall take out liability insurance unless liability is

assumed by the State in accordance with national law, or the Member State itself is

directly responsible for the conformity assessment.

10. The personnel of a conformity assessment body shall observe professional secrecy

with regard to all information obtained in carrying out their tasks under Article 14,

Article 15, ▌ or under points 3.1.2 and 3.1.3 of Annex I or any provision of national

law giving effect to them, except in relation to the competent authorities of the

Member State in which its activities are carried out. Proprietary rights shall be

protected.

380

11. Conformity assessment bodies shall participate in, or ensure that their ▌personnel

responsible for carrying out conformity assessment tasks are informed of, the relevant

standardisation activities and the activities of the notified body coordination group

established under the relevant Union harmonisation legislation and shall apply as

general guidance the administrative decisions and documents produced as a result of

the work of that group.

Article 25

Requirements relating to user inspectorates

1. For the purposes of notification, a user inspectorate shall meet the requirements laid

down in paragraphs 2 to 11.

2. A user inspectorate shall be established under national law of a Member State and

have legal personality.

3. A user inspectorate shall be organisationally identifiable and have reporting methods

within the group of which it is part which ensure and demonstrate its impartiality.

381

4. A user inspectorate, its top level management and the personnel responsible for

carrying out the conformity assessment tasks shall not be the designer, manufacturer,

supplier, installer, purchaser, owner, user or maintainer of the pressure equipment or

assembly which they assess, nor the authorised representative of any of those parties.

This shall not preclude the use of assessed pressure equipment or assemblies that are

necessary for the operations of the user inspectorate or the use of such equipment for

personal purposes.

A user inspectorate, its top level management and the personnel responsible for

carrying out the conformity assessment tasks shall not be directly involved in the

design, manufacture or construction, the marketing, installation, use or maintenance of

that pressure equipment or assembly, or represent the parties engaged in those

activities. They shall not engage in any activity that may conflict with their

independence of judgement or integrity in relation to conformity assessment activities

for which they are notified. This shall in particular apply to consultancy services.

382

5. User inspectorates and their personnel shall carry out the conformity assessment

activities with the highest degree of professional integrity and the requisite technical

competence in the specific field and shall be free from all pressures and inducements,

particularly financial, which might influence their judgement or the results of their

conformity assessment activities, especially as regards persons or groups of persons

with an interest in the results of those activities.

6. A user inspectorate shall be capable of carrying out all the conformity assessment tasks

assigned to it by Article 16 and in relation to which it has been notified, whether those

tasks are carried out by the user inspectorate itself or on its behalf and under its

responsibility.

At all times and for each conformity assessment procedure and each kind or category

of pressure equipment in relation to which it has been notified, the user inspectorate

shall have at its disposal the necessary:

383

(a) personnel with technical knowledge and sufficient and appropriate experience to

perform the conformity assessment tasks;

(b) descriptions of procedures in accordance with which conformity assessment is

carried out, ensuring the transparency and the ability of reproduction of those

procedures. It shall have appropriate policies and procedures in place that

distinguish between tasks it carries out as a user inspectorate and other activities;

(c) procedures for the performance of activities which take due account of the size

of an undertaking, the sector in which it operates, its structure, the degree of

complexity of the product technology in question and the mass or serial nature of

the production process.

A user inspectorate shall have the means necessary to perform the technical and

administrative tasks connected with the conformity assessment activities in an

appropriate manner and shall have access to all necessary equipment or facilities.

384

7. The personnel responsible for carrying out conformity assessment tasks shall have the

following:

(a) sound technical and vocational training covering all the conformity assessment

activities in relation to which the conformity assessment body has been notified;

(b) satisfactory knowledge of the requirements of the assessments they carry out and

adequate authority to carry out those assessments;

(c) appropriate knowledge and understanding of the essential safety requirements set

out in Annex I, of the applicable harmonised standards and of the relevant

provisions of Union harmonisation legislation and of national legislation;

(d) the ability to draw up certificates, records and reports demonstrating that

assessments have been carried out.

385

8. The impartiality of the user inspectorates, their top level management and of the

personnel responsible for carrying out conformity assessment tasks shall be

guaranteed. User inspectorates must not engage in any activities that might conflict

with its independence of judgement and integrity in relation to its inspection activities.

The remuneration of the top level management and personnel responsible for carrying

out conformity assessment tasks of a user inspectorate shall not depend on the number

of assessments carried out or on the results of those assessments.

9. User inspectorates shall take out liability insurance unless liability is assumed by the

group of which they are part.

10. The personnel of user inspectorates shall observe professional secrecy with regard to

all information obtained in carrying out their tasks under Article 16 or any provision of

national law giving effect to them, except in relation to the competent authorities of the

Member State in which its activities are carried out. Proprietary rights shall be

protected.

386

11. User inspectorates shall participate in, or ensure that their personnel responsible for

carrying out conformity assessment tasks are informed of, the relevant standardisation

activities and the activities of the notified body coordination group established under

the relevant Union harmonisation legislation and shall apply as general guidance the

administrative decisions and documents produced as a result of the work of that group.

Article 26

Presumption of conformity of conformity assessment bodies

Where a conformity assessment body demonstrates its conformity with the criteria laid down in

the relevant harmonised standards or parts thereof the references of which have been published

in the Official Journal of the European Union it shall be presumed to comply with the

requirements set out in Article 24 or Article 25 in so far as the applicable harmonised standards

cover those requirements.

387

Article 27

Subsidiaries of and subcontracting by conformity assessment bodies ▌

1. Where a notified body, a user inspectorate or a recognised third-party organisation

subcontracts specific tasks connected with conformity assessment or has recourse to a

subsidiary, it shall ensure that the subcontractor or the subsidiary meets the

requirements set out in Article 24 or Article 25 and shall inform the notifying authority

accordingly.

2. Notified bodies, user inspectorates and recognised third-party organisations shall take

full responsibility for the tasks performed by subcontractors or subsidiaries wherever

these are established.

3. Activities may be subcontracted or carried out by a subsidiary only with the agreement

of the client.

4. Notified bodies, user inspectorates and recognised third-party organisations shall keep

at the disposal of the notifying authority the relevant documents concerning the

assessment of the qualifications of the subcontractor or the subsidiary and the work

carried out by them under Article 14, Article 15, Article 16 or points 3.1.2 and 3.1.3 of

Annex I.

388

Article 28

Application for notification

1. A conformity assessment body shall submit an application for notification to the

notifying authority of the Member State in which it is established.

2. The application for notification shall be accompanied by a description of the

conformity assessment activities, the conformity assessment module or modules and

the pressure equipment for which that body claims to be competent, as well as by an

accreditation certificate, where one exists, issued by a national accreditation body

attesting that the conformity assessment body fulfils the requirements laid down in

Article 24 or Article 25.

3. Where the conformity assessment body concerned cannot provide an accreditation

certificate, it shall provide the notifying authority with all the documentary evidence

necessary for the verification, recognition and regular monitoring of its compliance

with the requirements laid down in Article 24 or Article 25.

389

Article 29

Notification procedure

1. Notifying authorities may notify only conformity assessment bodies which have

satisfied the requirements laid down in Article 24 or Article 25.

2. They shall notify the Commission and the other Member States using the electronic

notification tool developed and managed by the Commission.

3. The notification shall include full details of the conformity assessment activities, the

conformity assessment module or modules and the pressure equipment concerned and

the relevant attestation of competence.

4. Where a notification is not based on an accreditation certificate as referred to in Article

28(2), the notifying authority shall provide the Commission and the other Member

States with documentary evidence which attests to the conformity assessment body's

competence and the arrangements in place to ensure that that body will be monitored

regularly and will continue to satisfy the requirements laid down in Article 24 or

Article 25.

390

5. The body concerned may perform the activities of a notified body, a recognised third-

party organisation or a user inspectorate only where no objections are raised by the

Commission or the other Member States within two weeks of a notification where an

accreditation certificate is used or within two months of a notification where

accreditation is not used.

Only such a body shall be considered a notified body, a recognised third-party

organisation or a user inspectorate for the purposes of this Directive.

6. The notifying authority shall notify the Commission and the other Member States ▌

of any subsequent relevant changes to the notification.

Article 30

Identification numbers and lists of notified bodies

1. The Commission shall assign an identification number to a notified body.

It shall assign a single such number even where the body is notified under several

Union acts.

391

2. The Commission shall make publicly available the list of the bodies notified under this

Directive, including the identification numbers that have been assigned to them and

the activities for which they have been notified.

The Commission shall ensure that the list is kept up to date.

Article 31

Lists of recognised third-party organisations and user inspectorates

The Commission shall make publicly available the list of the recognised third-party

organisations and of the user inspectorates under this Directive and the tasks for which they

have been recognised.

The Commission shall ensure that the list is kept up to date.

392

Article 32

Changes to notifications

1. Where a notifying authority has ascertained or has been informed that a notified body

or a recognised third-party organisation no longer meets the requirements laid down in

Article 24 or that it is failing to fulfil its obligations, the notifying authority shall, as

appropriate, restrict, suspend or withdraw the notification, depending on the

seriousness of the failure to meet those requirements or fulfil those obligations. It shall

immediately inform the Commission and the other Member States accordingly.

Where a notifying authority has ascertained or has been informed that a user

inspectorate no longer meets the requirements laid down in Article 25, or that it is

failing to fulfil its obligations, the notifying authority shall as appropriate, restrict,

suspend or withdraw the notification, depending on the seriousness of the failure to

meet those requirements or fulfil those obligations. It shall immediately inform the

Commission and the other Member States accordingly.

393

2. In the event of restriction, suspension or withdrawal of notification, or where the

notified body, the recognised third-party organisation or the user inspectorate has

ceased its activity, the notifying Member State shall take appropriate steps to ensure

that the files of that body are either processed by another notified body, recognised

third-party organisation or user inspectorate, or kept available for the responsible

notifying and market surveillance authorities at their request.

Article 33

Challenge of the competence of notified bodies, recognised third party organisations and user

inspectorates

1. The Commission shall investigate all cases where it doubts, or doubt is brought to its

attention regarding, the competence of a notified body, a recognised third-party

organisation or a user inspectorate, or the continued fulfilment by a notified body, a

recognised third-party organisation or a user inspectorate of the requirements and

responsibilities to which it is subject.

394

2. The notifying Member State shall provide the Commission, on request, with all

information relating to the basis for the notification or the maintenance of the

competence of the conformity assessment body concerned.

3. The Commission shall ensure that all sensitive information obtained in the course of its

investigations is treated confidentially.

4. Where the Commission ascertains that a notified body, a recognised third-party

organisation or a user inspectorate does not meet or no longer meets the requirements

for its notification, it shall adopt an implementing act requesting the notifying Member

State to take the necessary corrective measures, including withdrawal of notification if

necessary.

That implementing act shall be adopted in accordance with the advisory procedure

referred to in Article 44(2).

Article 34

Operational obligations of notified bodies, user inspectorates and recognised third party

organisations

1. Notified bodies, user inspectorates and recognised third-party organisations shall carry

out conformity assessments in accordance with the conformity assessment tasks

provided for in Article 14, Article 15, Article 16, ▌ or in points 3.1.2 and 3.1.3 of

Annex I.

395

2. Conformity assessments shall be carried out in a proportionate manner, avoiding

unnecessary burdens for economic operators.

Conformity assessment bodies shall perform their activities taking due account of the

size of an undertaking, the sector in which it operates, its structure, the degree of

complexity of the pressure equipment or assembly technology in question and the mass

or serial nature of the production process.

In so doing they shall nevertheless respect the degree of rigour and the level of

protection required for the compliance of the pressure equipment with the

requirements of this Directive.

3. Where a conformity assessment body finds that essential safety requirements set out in

Annex I or corresponding harmonised standards or other technical specifications have

not been met by a manufacturer, it shall require that manufacturer to take appropriate

corrective measures and shall not issue a ▌ certificate of conformity.

396

4. Where, in the course of the monitoring of conformity following the issue of a

certificate, a conformity assessment body finds that pressure equipment no longer

complies, it shall require the manufacturer to take appropriate corrective measures and

shall suspend or withdraw the certificate if necessary.

5. Where corrective measures are not taken or do not have the required effect, the

conformity assessment body shall restrict, suspend or withdraw any certificates, as

appropriate.

Article 35

Appeal against decisions of notified bodies, recognised third party organisations and user

inspectorates

Member States shall ensure that ▌ appeal procedures against decisions of notified bodies,

recognised third-party organisations and user inspectorates are available.

397

Article 36

Information obligation on notified bodies, recognised third party organisations and user

inspectorates

1. Notified bodies, recognised third-party organisations and user inspectorates shall

inform the notifying authority of the following:

(a) any refusal, restriction, suspension or withdrawal of a certificate;

(b) any circumstances affecting the scope of or conditions for notification;

(c) any request for information which they have received from market surveillance

authorities regarding conformity assessment activities;

(d) on request, conformity assessment activities performed within the scope of their

notification and any other activity performed, including cross-border activities

and subcontracting.

398

2. Notified bodies, recognised third-party organisations and user inspectorates shall

provide the other bodies notified under this Directive carrying out similar conformity

assessment activities covering the same pressure equipment with relevant information

on issues relating to negative and, on request, positive conformity assessment results.

Article 37

Exchange of experience

The Commission shall provide for the organisation of exchange of experience between the

Member States' national authorities responsible for notification policy.

Article 38

Coordination of notified bodies, recognised third-party organisations and user inspectorates

The Commission shall ensure that appropriate coordination and cooperation between the

conformity assessment bodies notified under this Directive are put in place and properly

operated in the form of a sectoral group or groups of conformity assessment bodies.

Member States shall ensure that the conformity assessment bodies notified by them participate

in the work of that or those group or groups, directly or by means of designated representatives.

399

CHAPTER 5

UNION MARKET SURVEILLANCE, CONTROL OF PRESSURE EQUIPMENT AND

ASSEMBLIES ENTERING THE UNION MARKET, AND UNION SAFEGUARD

PROCEDURE

Article 39

Union market surveillance and control of pressure equipment and assemblies entering the

Union market

Article 15(3) and Articles 16 to 29 of Regulation (EC) No 765/2008 shall apply to pressure

equipment and assemblies covered by Article 1 of this Directive.

400

Article 40

Procedure for dealing with pressure equipment or assemblies presenting a risk at national

level

1. Where the market surveillance authorities of one Member State have sufficient

reasons to believe that pressure equipment or assemblies covered by this Directive

present a risk to the health or safety of persons or to domestic animals or property,

they shall carry out an evaluation in relation to the pressure equipment or assembly

concerned covering all relevant requirements laid down in this Directive. The

relevant economic operators shall cooperate as necessary with the market

surveillance authorities for that purpose.

Where, in the course of the evaluation referred to in the first subparagraph, the

market surveillance authorities find that the equipment or assembly does not comply

with the requirements laid down in this Directive, they shall without delay require

the relevant economic operator to take all appropriate corrective actions to bring the

pressure equipment or assembly into compliance with those requirements, to

withdraw the equipment or assembly from the market, or to recall it within a

reasonable period, commensurate with the nature of the risk, as they may prescribe.

401

The market surveillance authorities shall inform the relevant notified body

accordingly.

Article 21 of Regulation (EC) No 765/2008 shall apply to the measures referred to in

the second subparagraph of this paragraph.

2. Where the market surveillance authorities consider that non-compliance is not

restricted to their national territory, they shall inform the Commission and the other

Member States of the results of the evaluation and of the actions which they have

required the economic operator to take.

3. The economic operator shall ensure that all appropriate corrective action is taken in

respect of all the pressure equipment and assemblies concerned that it has made

available on the market throughout the Union.

4. Where the relevant economic operator does not take adequate corrective action

within the period referred to in the second subparagraph of paragraph 1, the market

surveillance authorities shall take all appropriate provisional measures to prohibit or

restrict the equipment’s or assembly's being made available on their national

market, to withdraw the equipment or assembly from that market or to recall it.

402

The market surveillance authorities shall inform the Commission and the other

Member States, without delay, of those measures.

5. The information referred to in the second subparagraph of paragraph 4 shall

include all available details, in particular the data necessary for the identification of

the non-compliant equipment or assembly, the origin of the equipment or assembly,

the nature of the non-compliance alleged and the risk involved, the nature and

duration of the national measures taken and the arguments put forward by the

relevant economic operator. In particular, the market surveillance authorities shall

indicate whether the non-compliance is due to either of the following:

(a) failure of the equipment or assembly to meet requirements relating to the

health or safety of persons or to the protection of domestic animals or

property; or

(b) shortcomings in the harmonised standards referred to in Article 12 conferring

a presumption of conformity.

403

6. Member States other than the Member State initiating the procedure under this

Article shall without delay inform the Commission and the other Member States of

any measures adopted and of any additional information at their disposal relating to

the non-compliance of the equipment or assembly concerned, and, in the event of

disagreement with the adopted national measure, of their objections.

7. Where, within three months of receipt of the information referred to in the second

subparagraph of paragraph 4, no objection has been raised by either a Member

State or the Commission in respect of a provisional measure taken by a Member

State, that measure shall be deemed justified.

8. Member States shall ensure that appropriate restrictive measures, such as

withdrawal of the equipment or assembly from the market, are taken in respect of

the equipment or assembly concerned without delay.

404

Article 41

Union safeguard procedure

1. Where, on completion of the procedure set out in Article 40(3) and (4), objections

are raised against a measure taken by a Member State, or where the Commission

considers a national measure to be contrary to Union legislation, the Commission

shall without delay enter into consultation with the Member States and the relevant

economic operator or operators and shall evaluate the national measure. On the

basis of the results of that evaluation, the Commission shall adopt an implementing

act determining whether the national measure is justified or not.

The Commission shall address its decision to all Member States and shall

immediately communicate it to them and the relevant economic operator or

operators.

405

2. If the national measure is considered justified, all Member States shall take the

necessary measures to ensure that the non-compliant equipment or assembly is

withdrawn from their market, and shall inform the Commission accordingly. If the

national measure is considered unjustified, the Member State concerned shall

withdraw that measure.

3. Where the national measure is considered justified and the non-compliance of the

equipment or assembly is attributed to shortcomings in the harmonised standards

referred to in point (b) of Article 40(5) of this Directive, the Commission shall apply

the procedure provided for in Article 11 of Regulation (EU) No 1025/2012.

406

Article 42

Compliant pressure equipment or assemblies which present a risk

1. Where, having carried out an evaluation under Article 40(1), a Member State finds

that although pressure equipment or an assembly is in compliance with this

Directive, it presents a risk to the health or safety of persons, to domestic animals or

property, it shall require the relevant economic operator to take all appropriate

measures to ensure that the equipment or assembly concerned, when placed on the

market, no longer presents that risk, to withdraw the equipment or assembly from

the market or to recall it within a reasonable period, commensurate with the nature

of the risk, as it may prescribe.

2. The economic operator shall ensure that corrective action is taken in respect of all

the equipment or assemblies concerned that he has made available on the market

throughout the Union.

407

3. The Member State shall immediately inform the Commission and the other Member

States. That information shall include all available details, in particular the data

necessary for the identification of the equipment or assembly concerned, the origin

and the supply chain of the equipment or assembly, the nature of the risk involved

and the nature and duration of the national measures taken.

4. The Commission shall without delay enter into consultation with the Member States

and the relevant economic operator or operators and shall evaluate the national

measures taken. On the basis of the results of that evaluation, the Commission shall

decide by means of implementing acts whether the national measure is justified or

not and, where necessary, propose appropriate measures.

408

The implementing acts referred to in the first subparagraph of this paragraph shall

be adopted in accordance with the examination procedure referred to in Article

44(3).

On duly justified imperative grounds of urgency relating to the protection of health

and safety of persons, or of domestic animals or of property, the Commission shall

adopt immediately applicable implementing acts in accordance with the procedure

referred to in Article 44(4).

5. The Commission shall address its decision to all Member States and shall

immediately communicate it to them and the relevant economic operator or

operators.

409

Article 43

Formal non-compliance

1. Without prejudice to Article 40, where a Member State makes one of the following

findings, it shall require the relevant economic operator to put an end to the non-

compliance concerned:

(a) the CE marking has been affixed in violation of Article 30 of Regulation (EC)

No 765/2008 or of Article 19 of this Directive;

(b) the CE marking has not been affixed;

(c) the identification number of the notified body involved in the production

control phase, has been affixed in violation of Article 19 or has not been

affixed;

(d) the marking and labelling referred to in point 3.3. of Annex I have not been

affixed or have been affixed in violation of Article 19 or point 3.3 of Annex I;

(e) the EU declaration of conformity has not been drawn up;

410

(f) the EU declaration of conformity has not been drawn up correctly;

(g) the technical documentation is either not available or not complete;

(h) the information referred to in Article 6(6) or Article 8(3) is absent, false or

incomplete;

(i) any other administrative requirement provided for in Article 6 or Article 8 is

not fulfilled.

2. Where the non-compliance referred to in paragraph 1 persists, the Member State

concerned shall take all appropriate measures to restrict or prohibit the equipment

or assembly being made available on the market or ensure that it is recalled or

withdrawn from the market.

411

CHAPTER 6

COMMITTEE PROCEDURE AND DELEGATED ACTS

Article 44

Committee procedure

1. The Commission shall be assisted by the Committee on Pressure Equipment ▌. That

committee shall be a committee within the meaning of Regulation (EU) No 182/2011.

2. Where reference is made to this paragraph, Article 4 of Regulation (EU) No 182/2011

shall apply.

3. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011

shall apply.

4. Where reference is made to this paragraph, Article 8 of Regulation (EU) No

182/2011, in conjunction with Article 5 thereof, shall apply.

5. The committee shall be consulted by the Commission on any matter for which

consultation of sectoral experts is required by Regulation (EU) No 1025/2012 or by

any other Union legislation.

The committee may furthermore examine any other matter concerning the

application of this Directive raised either by its chair or by a representative of a

Member State in accordance with its rules of procedure.

412

Article 45

Delegated power

1. In order to take into account emerging very serious safety reasons, the Commission

shall be empowered to adopt delegated acts in accordance with Article 46 reclassifying

pressure equipment or assemblies so as to:

(a) make an item or family of pressure equipment referred to in Article 4(3)

▌subject to the requirements of Article 4(1);

(b) make an assembly or family of assemblies referred to in Article 4(3) ▌subject to

the requirements of Article 4(2);

(c) classify an item or family of pressure equipment ▌, by way of derogation from

the requirements of Annex II, in another category.

2. A Member State having concerns about the safety of pressure equipment or

assemblies shall immediately inform the Commission of its concerns and provide

reasons in support.

3. Prior to adopting a delegated act the Commission shall carry out a thorough

assessment of the risks that require reclassification.

413

Article 46

Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the

conditions laid down in this Article.

2. The ▌ power to adopt delegated acts referred to in Article 45 shall be conferred on the

Commission for a period of five years from 1 June 2015. The Commission shall draw

up a report in respect of the delegation of power not later than nine months before

the end of the five-year period. The delegation of power shall be tacitly extended for

periods of an identical duration, unless the European Parliament or the Council

opposes such extension not later than three months before the end of each period.

3. The delegation of power referred to in Article 45 may be revoked at any time by the

European Parliament or by the Council. A decision to revoke shall put an end to the

delegation of the power specified in that decision. It shall take effect the day following

the publication of the decision in the Official Journal of the European Union or at a

later date specified therein. It shall not affect the validity of any delegated acts already

in force.

4. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to

the European Parliament and to the Council.

414

5. A delegated act adopted pursuant to Article 45 shall enter into force only if no

objection has been expressed either by the European Parliament or the Council within

a period of two months of notification of that act to the European Parliament and the

Council or if, before the expiry of that period, the European Parliament and the

Council have both informed the Commission that they will not object. That period

shall be extended by two months at the initiative of the European Parliament or of the

Council.

CHAPTER 7

TRANSITIONAL AND FINAL PROVISIONS

Article 47

Penalties

Member States shall lay down rules on penalties applicable to infringements by economic

operators of the ▌ provisions of national law adopted pursuant to this Directive and shall take

all measures necessary to ensure that they are implemented. Such rules may include criminal

penalties for serious infringements.

The penalties referred to in the first paragraph shall be effective, proportionate and dissuasive.

415

Article 48

Transitional provisions

1. Member States shall not impede the putting into service of pressure equipment and

assemblies which comply with the regulations in force in their territory at the date of

application of Directive 97/23/EC and were placed on the market until 29 May 2002.

2. Member States shall not impede the making available on the market and/or the putting

into service of pressure equipment or assemblies covered by Directive 97/23/EC

which are in conformity with that Directive and which were placed on the market

before 1 June 2015.

3. Certificates and decisions issued by conformity assessment bodies under Directive

97/23/EC shall be valid under this Directive.

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Article 49

Transposition

1. Member States shall adopt and publish, by 28 February 2015 ▌, the laws, regulations

and administrative provisions necessary to comply with Article 13. They shall

forthwith communicate ▌the text of those measures to the Commission.

They shall apply those measures from 1 June 2015.

When Member States adopt those measures, they shall contain a reference to this

Directive or be accompanied by such reference on the occasion of their official

publication. They shall also include a statement that references in existing laws,

regulations and administrative provisions to Article 9 of Directive 97/23/EC shall be

construed as references to Article 13 of this Directive. Member States shall determine

how such reference is to be made and how that statement is to be formulated.

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2. Member States shall adopt and publish, by ...* , the laws, regulations and

administrative provisions necessary to comply with Article 2(15) to (32), Articles 6 to

12, 14, 17 and 18, Article 19(3) to (5), Articles 20 to 43, 47 and 48 and Annexes I, II,

III and IV. They shall forthwith communicate the text of those measures to the

Commission.

They shall apply those measures from ...**.

When Member States adopt those measures, they shall contain a reference to this

Directive or be accompanied by such reference on the occasion of their official

publication. They shall also include a statement that references in existing laws,

regulations and administrative provisions to the Directive repealed by this Directive

shall be construed as references to this Directive. Member States shall determine

how such reference is to be made and how that statement is to be formulated.

* OJ: insert date – 2 years after the entry into force of this Directive.* * OJ: insert date - day after 2 years after the entry into force of this Directive.

418

3. Member States shall communicate to the Commission the text of the main provisions

of national law which they adopt in the field governed by this Directive.

Article 50

Repeal

Article 9 of Directive 97/23/EC ▌ is deleted with effect from 1 June 2015, without prejudice to

the obligations of the Member States relating to the time-limit for transposition into national

law and the date of application of that Article, set out in Annex V, Part B.

Directive 97/23/EC, as amended by the acts listed in Annex V, Part A, is repealed with effect

from ...*, without prejudice to the obligations of the Member States relating to the time-limit

for transposition into national law and the date of application of the Directive set out in ▌

Annex V, Part B.

References to the repealed Directive shall be construed as references to this Directive and shall

be read in accordance with the correlation table in Annex VI.

* OJ: insert date – day after 2 years after the entry into force of this Directive.

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Article 51

Entry into force and application

This Directive shall enter into force on the twentieth day following that of its publication in the

Official Journal of the European Union.

Article 1, points 1 to 14 of Article 2, Articles 3, 4, 5, 14, 15 and 16, Article 19(1) and (2), and

Articles 44, 45 and 46 shall apply from ...*.

Article 52

Addressees ▌

This Directive is addressed to the Member States.

Done at ...,

For the European Parliament For the Council

The President The President

* OJ: insert date – day after 2 years after the entry into force of this Directive.

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ANNEX I

ESSENTIAL SAFETY REQUIREMENTS

PRELIMINARY OBSERVATIONS

1. The obligations arising from the essential safety requirements listed in this Annex for

pressure equipment also apply to assemblies where the corresponding hazard exists.

2. The essential safety requirements laid down in this Directive are compulsory. The

obligations following from those essential safety requirements apply only if the

corresponding hazard exists for the pressure equipment in question when it is used

under conditions which are reasonably foreseeable by the manufacturer.

3. The manufacturer is under an obligation to analyse the hazards and risks in order to

identify those which apply to his equipment on account of pressure; he shall then

design and construct it taking account of his analysis.

4. The essential safety requirements are to be interpreted and applied in such a way as to

take account of the state of the art and current practice at the time of design and

manufacture as well as of technical and economic considerations which are consistent

with a high degree of health and safety protection.

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1. GENERAL

1.1. Pressure equipment shall be designed, manufactured and checked, and if applicable

equipped and installed, in such a way as to ensure its safety when put into service in

accordance with the manufacturer's instructions, or in reasonably foreseeable

conditions.

1.2. In choosing the most appropriate solutions, the manufacturer shall apply the principles

set out below in the following order:

– eliminate or reduce hazards as far as is reasonably practicable;

– apply appropriate protection measures against hazards which cannot be

eliminated;

– where appropriate, inform users of residual hazards and indicate whether it is

necessary to take appropriate special measures to reduce the risks at the time of

installation and/or use.

1.3. Where the potential for misuse is known or can be clearly foreseen, the pressure

equipment shall be designed to prevent risks from such misuse or, if that is not

possible, adequate warning given that the pressure equipment shall not be used in that

way.

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2. DESIGN

2.1. General

The pressure equipment shall be properly designed taking all relevant factors into

account in order to ensure that the equipment will be safe throughout its intended life.

The design shall incorporate appropriate safety coefficients using comprehensive

methods which are known to incorporate adequate safety margins against all relevant

failure modes in a consistent manner.

2.2. Design for adequate strength

2.2.1. The pressure equipment shall be designed for loadings appropriate to its intended use

and other reasonably foreseeable operating conditions. In particular, the following

factors shall be taken into account:

– internal/external pressure;

– ambient and operational temperatures;

– static pressure and mass of contents in operating and test conditions;

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– traffic, wind, earthquake loading;

– reaction forces and moments which result from the supports, attachments, piping,

etc.;

– corrosion and erosion, fatigue, etc.;

– decomposition of unstable fluids.

Various loadings which can occur at the same time shall be considered, taking into

account the probability of their simultaneous occurrence.

2.2.2. Design for adequate strength shall be based on either of the following:

– as a general rule, a calculation method, as described in point 2.2.3, and

supplemented if necessary by an experimental design method as described in

point 2.2.4;

– an experimental design method without calculation, as described in point 2.2.4,

when the product of the maximum allowable pressure PS and the volume V is

less than 6000 bar·L or the product PS·DN less than 3000 bar.

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2.2.3. Calculation method

(a) Pressure containment and other loading aspects

The allowable stresses for pressure equipment shall be limited having regard to

reasonably foreseeable failure modes under operating conditions. To this end,

safety factors shall be applied to eliminate fully any uncertainty arising out of

manufacture, actual operational conditions, stresses, calculation models and the

properties and behaviour of the material.

These calculation methods shall provide sufficient safety margins consistent,

where applicable, with the requirements of point 7.

The requirements set out above may be met by applying one of the following

methods, as appropriate, if necessary as a supplement to or in combination with

another method:

– design by formula;

– design by analysis;

– design by fracture mechanics.

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(b) Resistance

Appropriate design calculations shall be used to establish the resistance of the

pressure equipment concerned.

In particular:

– the calculation pressures shall not be less than the maximum allowable

pressures and take into account static head and dynamic fluid pressures and

the decomposition of unstable fluids. Where a vessel is separated into

individual pressure-containing chambers, the partition wall shall be

designed on the basis of the highest possible chamber pressure relative to

the lowest pressure possible in the adjoining chamber,

– the calculation temperatures shall allow for appropriate safety margins,

– the design shall take appropriate account of all possible combinations of

temperature and pressure which might arise under reasonably foreseeable

operating conditions for the equipment,

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– the maximum stresses and peak stress concentrations shall be kept within

safe limits,

– the calculation for pressure containment shall utilise the values appropriate

to the properties of the material, based on documented data, having regard

to the provisions set out in point 4 together with appropriate safety factors.

Material characteristics to be considered, where applicable, include:

– yield strength, 0,2 % or 1,0 % proof strength as appropriate at

calculation temperature;

– tensile strength;

– time-dependent strength, i.e. creep strength;

– fatigue data;

– Young's modulus (modulus of elasticity);

– appropriate amount of plastic strain;

– bending rupture energy;

– fracture toughness.

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– appropriate joint factors shall be applied to the material properties

depending, for example, on the type of non-destructive testing, the

materials joined and the operating conditions envisaged;

– the design shall take appropriate account of all reasonably foreseeable

degradation mechanisms (e.g. corrosion, creep, fatigue) commensurate

with the intended use of the equipment. Attention shall be drawn, in the

instructions referred to in point 3.4, to particular features of the design

which are relevant to the life of the equipment, for example:

– for creep: design hours of operation at specified temperatures;

– for fatigue: design number of cycles at specified stress levels;

– for corrosion: design corrosion allowance.

(c) Stability aspects

Where the calculated thickness does not allow for adequate structural stability,

the necessary measures shall be taken to remedy the situation taking into account

the risks from transport and handling.

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2.2.4. Experimental design method

The design of the equipment may be validated, in all or in part, by an appropriate test

programme carried out on a sample representative of the equipment or the category of

equipment.

The test programme shall be clearly defined prior to testing and accepted by the

notified body responsible for the design conformity assessment module, where it

exists.

This programme shall define test conditions and criteria for acceptance or refusal. The

actual values of the essential dimensions and characteristics of the materials which

constitute the equipment tested shall be measured before the test.

Where appropriate, during tests, it shall be possible to observe the critical zones of the

pressure equipment with adequate instrumentation capable of registering strains and

stresses with sufficient precision.

The test programme shall include:

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(a) A pressure strength test, the purpose of which is to check that, at a pressure with

a defined safety margin in relation to the maximum allowable pressure, the

equipment does not exhibit significant leaks or deformation exceeding a

determined threshold.

The test pressure shall be determined on the basis of the differences between the

values of the geometrical and material characteristics measures under test

conditions and the values used for design purposes; it shall take into account the

differences between the test and design temperatures;

(b) where the risk of creep or fatigue exists, appropriate tests determined on the

basis of the service conditions laid down for the equipment, for instance hold

time at specified temperatures, number of cycles at specified stress-levels;

(c) where necessary, additional tests concerning other factors referred to in point

2.2.1 such as corrosion, external damage.

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2.3. Provisions to ensure safe handling and operation

The method of operation specified for pressure equipment shall be such as to preclude

any reasonably foreseeable risk in operation of the equipment. Particular attention shall

be paid, where appropriate, to:

– closures and openings;

– dangerous discharge of pressure relief blow-off;

– devices to prevent physical access whilst pressure or a vacuum exists;

– surface temperature taking into consideration the intended use;

– decomposition of unstable fluids.

In particular, pressure equipment fitted with an access door shall be equipped with an

automatic or manual device enabling the user easily to ascertain that the opening will

not present any risk. Furthermore, where the opening can be operated quickly, the

pressure equipment shall be fitted with a device to prevent it being opened whenever

the pressure or temperature of the fluid presents a risk.

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2.4. Means of examination

(a) Pressure equipment shall be designed and constructed so that all necessary

examinations to ensure safety can be carried out;

(b) Means of determining the internal condition of the equipment shall be available,

where it is necessary to ensure the continued safety of the equipment, such as

access openings allowing physical access to the inside of the pressure equipment

so that appropriate examinations can be carried out safely and ergonomically;

(c) Other means of ensuring the safe condition of the pressure equipment may be

applied in any of the following situations:

– where it is too small for physical internal access;

– where opening the pressure equipment would adversely affect the inside;

– where the substance contained has been shown not to be harmful to the

material from which the pressure equipment is made and no other internal

degradation mechanisms are reasonably foreseeable.

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2.5. Means of draining and venting

Adequate means shall be provided for the draining and venting of pressure equipment

where necessary:

– to avoid harmful effects such as water hammer, vacuum collapse, corrosion and

uncontrolled chemical reactions. All stages of operation and testing, particularly

pressure testing, shall be considered;

– to permit cleaning, inspection and maintenance in a safe manner.

2.6. Corrosion or other chemical attack

Where necessary, adequate allowance or protection against corrosion or other chemical

attack shall be provided, taking due account of the intended and reasonably foreseeable

use.

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2.7. Wear

Where severe conditions of erosion or abrasion may arise, adequate measures shall be

taken to:

– minimise that effect by appropriate design, e.g. additional material thickness, or

by the use of liners or cladding materials;

– permit replacement of parts which are most affected;

– draw attention, in the instructions referred to in point 3.4, to measures necessary

for continued safe use.

2.8. Assemblies

Assemblies shall be so designed that:

– the components to be assembled together are suitable and reliable for their duty;

– all the components are properly integrated and assembled in an appropriate

manner.

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2.9. Provisions for filling and discharge

Where appropriate, the pressure equipment shall be so designed and provided with

accessories, or provision made for their fitting, as to ensure safe filling and discharge

in particular with respect to risks such as:

(a) on filling:

– overfilling or overpressurisation having regard in particular to the filling

ratio and to vapour pressure at the reference temperature;

– instability of the pressure equipment;

(b) on discharge: the uncontrolled release of the pressurised fluid;

(c) on filling or discharge: unsafe connection and disconnection.

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2.10. Protection against exceeding the allowable limits of pressure equipment

Where, under reasonably foreseeable conditions, the allowable limits could be

exceeded, the pressure equipment shall be fitted with, or provision made for the fitting

of, suitable protective devices, unless the equipment is intended to be protected by

other protective devices within an assembly.

The suitable device or combination of such devices shall be determined on the basis of

the particular characteristics of the equipment or assembly.

Suitable protective devices and combinations thereof comprise:

(a) safety accessories as defined in point 4 of Article 2 ▌,

(b) where appropriate, adequate monitoring devices such as indicators and/or alarms

which enable adequate action to be taken either automatically or manually to

keep the pressure equipment within the allowable limits.

2.11. Safety accessories

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2.11.1. Safety accessories shall:

– be so designed and constructed as to be reliable and suitable for their intended

duty and take into account the maintenance and testing requirements of the

devices, where applicable;

– be independent of other functions, unless their safety function cannot be affected

by such other functions;

– comply with appropriate design principles in order to obtain suitable and reliable

protection. These principles include, in particular, fail-safe modes, redundancy,

diversity and self-diagnosis.

2.11.2. Pressure limiting devices

These devices shall be so designed that the pressure will not permanently exceed the

maximum allowable pressure PS; however a short duration pressure surge in keeping

with the specifications laid down in point 7.3 is allowable, where appropriate.

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2.11.3. Temperature monitoring devices

These devices shall have an adequate response time on safety grounds, consistent with

the measurement function.

2.12. External fire

Where necessary, pressure equipment shall be so designed and, where appropriate,

fitted with suitable accessories, or provision made for their fitting, to meet damage-

limitation requirements in the event of external fire, having particular regard to its

intended use.

3. MANUFACTURING

3.1. Manufacturing procedures

The manufacturer shall ensure the competent execution of the provisions set out at the

design stage by applying the appropriate techniques and relevant procedures,

especially with a view to the aspects set out below.

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3.1.1. Preparation of the component parts

Preparation of the component parts (e.g. forming and chamfering) shall not give rise to

defects or cracks or changes in the mechanical characteristics likely to be detrimental

to the safety of the pressure equipment.

3.1.2. Permanent joining

Permanent joints and adjacent zones shall be free of any surface or internal defects

detrimental to the safety of the equipment.

The properties of permanent joints shall meet the minimum properties specified for the

materials to be joined unless other relevant property values are specifically taken into

account in the design calculations.

For pressure equipment, permanent joining of components which contribute to the

pressure resistance of equipment and components which are directly attached to them

shall be carried out by suitably qualified personnel according to suitable operating

procedures.

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For pressure equipment in categories II, III and IV, operating procedures and personnel

shall be approved by a competent third party which, at the manufacturer's discretion,

may be:

– a notified body;

– a third-party organisation recognised by a Member State as provided for in

Article 20.

To carry out these approvals the third party must perform examinations and tests as set

out in the appropriate harmonised standards or equivalent examinations and tests or

shall have them performed.

3.1.3. Non-destructive tests

For pressure equipment, non-destructive tests of permanent joints shall be carried out

by suitable qualified personnel. For pressure equipment in categories III and IV, the

personnel shall be approved by a third-party organisation recognised by a Member

State pursuant to Article 20.

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3.1.4. Heat treatment

Where there is a risk that the manufacturing process will change the material properties

to an extent which would impair the safety of the pressure equipment, suitable heat

treatment shall be applied at the appropriate stage of manufacture.

3.1.5. Traceability

Suitable procedures shall be established and maintained for identifying the material

making up the components of the equipment which contribute to pressure resistance by

suitable means from receipt, through production, up to the final test of the

manufactured pressure equipment.

3.2. Final assessment

Pressure equipment shall be subjected to final assessment as described below.

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3.2.1. Final inspection

Pressure equipment shall undergo a final inspection to assess visually and by

examination of the accompanying documents compliance with the requirements of this

Directive. Test carried out during manufacture may be taken into account. As far as is

necessary on safety grounds, the final inspection shall be carried out internally and

externally on every part of the equipment, where appropriate in the course of

manufacture (e.g. where examination during the final inspection is no longer possible).

3.2.2. Proof test

Final assessment of pressure equipment shall include a test for the pressure

containment aspect, which will normally take the form of a hydrostatic pressure test at

a pressure at least equal, where appropriate, to the value laid down in point 7.4.

For category I series-produced pressure equipment, this test may be performed on a

statistical basis.

Where the hydrostatic pressure test is harmful or impractical, other tests of a

recognised value may be carried out. For tests other than the hydrostatic pressure test,

additional measures, such as non-destructive tests or other methods of equivalent

validity, shall be applied before those tests are carried out.

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3.2.3. Inspection of safety devices

For assemblies, the final assessment shall also include a check of the safety devices

intended to check full compliance with the requirements referred to in point 2.10.

3.3. Marking and labelling

In addition to the CE marking referred to in Articles ▌ 18 and 19 and the information

to be provided in accordance with Article 6(6) and Article 8(3), the following

information shall be provided:

(a) for all pressure equipment ▌:

▌

– the year of manufacture;

– identification of the pressure equipment according to its nature, such as

type, series or batch identification and serial number;

– essential maximum/minimum allowable limits.

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(b) depending on the type of pressure equipment ▌, further information necessary

for safe installation, operation or use and, where applicable, maintenance and

periodic inspection such as:

– the volume V of the pressure equipment in L;

– the nominal size for piping DN;

– the test pressure PT applied in bar and date;

– safety device set pressure in bar;

– output of the pressure equipment in kW;

– supply voltage in V (volts);

– intended use;

– filling ratio kg/L;

– maximum filling mass in kg;

– tare mass in kg;

– the fluid group.

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(c) where necessary, warnings fixed to the pressure equipment ▌ drawing attention

to misuse which experience has shown might occur.

The ▌ information referred to in points (a), (b) and (c) shall be given on the pressure

equipment ▌ or on a dataplate firmly attached to it, with the following exceptions:

– where applicable, appropriate documentation may be used to avoid repetitive

marking of individual parts such as piping components, intended for the same

assembly ▌;

– where the pressure equipment is too small, e.g. accessories, this information ▌

may be given on a label attached to that pressure equipment ▌;

– labelling or other adequate means may be used for the mass to be filled and the

warnings referred to in point (c), provided it remains legible for the appropriate

period of time.

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3.4. Operating instructions

(a) When pressure equipment is made available on the market, it shall be

accompanied, as far as relevant, with instructions for the user, containing all the

necessary safety information relating to:

– mounting including assembling of different pieces of pressure equipment;

– putting into service;

– use;

– maintenance including checks by the user.

(b) Instructions shall cover information affixed to the pressure equipment in

accordance with point 3.3, with the exception of serial identification, and shall

be accompanied, where appropriate, by the technical documents, drawings and

diagrams necessary for a full understanding of these instructions.

(c) If appropriate, these instructions shall also refer to risks arising from misuse in

accordance with point 1.3 and particular features of the design in accordance

with point 2.2.3.

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4. MATERIALS

Materials used for the manufacture of pressure equipment shall be suitable for such

application during the scheduled lifetime unless replacement is foreseen.

Welding consumables and other joining materials need to fulfil only the relevant

requirements of points 4.1, 4.2 (a) and the first paragraph of point 4.3, in an

appropriate way, both individually and in a joined structure.

4.1. Materials for pressurised parts shall:

(a) have appropriate properties for all operating conditions which are reasonably

foreseeable and for all test conditions, and in particular they should be

sufficiently ductile and tough. Where appropriate, the characteristics of the

materials shall comply with the requirements of point 7.5. Moreover, due care

should be exercised in particular in selecting materials in order to prevent brittle-

type fracture where necessary; where for specific reasons brittle material has to

be used appropriate measures shall be taken;

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(b) be sufficiently chemically resistant to the fluid contained in the pressure

equipment; the chemical and physical properties necessary for operational safety

shall not be significantly affected within the scheduled lifetime of the equipment;

(c) not be significantly affected by ageing;

(d) be suitable for the intended processing procedures;

(e) be selected in order to avoid significant undesirable effects when the various

materials are put together.

4.2. The pressure equipment manufacturer shall:

(a) define in an appropriate manner the values necessary for the design calculations

referred to in point 2.2.3 and the essential characteristics of the materials and

their treatment referred to in point 4.1;

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(b) provide in his technical documentation elements relating to compliance with the

materials specifications of this Directive in one of the following forms:

– by using materials which comply with harmonised standards;

– by using materials covered by a European approval of pressure equipment

materials in accordance with Article 15;

– by a particular material appraisal;

(c) for pressure equipment in categories III and IV, a specific assessment of the

particular material appraisal shall be performed by the notified body in charge of

conformity assessment procedures for the pressure equipment.

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4.3. The equipment manufacturer shall take appropriate measures to ensure that the

material used conforms with the required specification. In particular, documentation

prepared by the material manufacturer affirming compliance with a specification shall

be obtained for all materials.

For the main pressure-bearing parts of equipment in categories II, III and IV, this shall

take the form of a certificate of specific product control.

Where a material manufacturer has an appropriate quality-assurance system, certified

by a competent body established within the Union and having undergone a specific

assessment for materials, certificates issued by the manufacturer are presumed to

certify conformity with the relevant requirements of this point.

SPECIFIC PRESSURE EQUIPMENT REQUIREMENTS

In addition to the applicable requirements of points 1 to 4, the following requirements apply to

the pressure equipment covered by points 5 and 6.

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5. FIRED OR OTHERWISE HEATED PRESSURE EQUIPMENT WITH A RISK OF

OVERHEATING AS REFERRED TO IN ARTICLE 4(1)

This pressure equipment includes:

– steam and hot-water generators as referred to in Article 4(1)(b), such as fired

steam and hot-water boilers, superheaters and reheaters, waste-heat boilers,

waste incineration boilers, electrode or immersion-type electrically heated

boilers, pressure cookers, together with their accessories and where applicable

their systems for treatment of feedwater and for fuel supply;

– process-heating equipment for other than steam and hot water generation falling

under Article 4(1)(a), such as heaters for chemical and other similar processes

and pressurised food-processing equipment.

This pressure equipment shall be calculated, designed and constructed so as to avoid or

minimise risks of a significant loss of containment from overheating. In particular it

shall be ensured, where applicable, that:

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(a) appropriate means of protection are provided to restrict operating parameters

such as heat input, heat take-off and, where applicable, fluid level so as to avoid

any risk of local and general overheating;

(b) sampling points are provided where required to allow evaluation of the

properties of the fluid so as to avoid risks related to deposits and/or corrosion;

(c) adequate provisions are made to eliminate risks of damage from deposits;

(d) means of safe removal of residual heat after shutdown are provided;

(e) steps are taken to avoid a dangerous accumulation of ignitable mixtures of

combustible substances and air, or flame blowback.

6. PIPING AS REFERRED TO IN ARTICLE 4(1)(c)

Design and construction shall ensure:

(a) that the risk of overstressing from inadmissible free movement or excessive

forces being produced, e.g. on flanges, connections, bellows or hoses, is

adequately controlled by means such as support, constraint, anchoring, alignment

and pre-tension;

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(b) that where there is a possibility of condensation occurring inside pipes for

gaseous fluids, means are provided for drainage and removal of deposits from

low areas to avoid damage from water hammer or corrosion;

(c) that due consideration is given to the potential damage from turbulence and

formation of vortices; the relevant parts of point 2.7 are applicable;

(d) that due consideration is given to the risk of fatigue due to vibrations in pipes;

(e) that, where fluids of Group 1 are contained in the piping, appropriate means are

provided to isolate "take-off" pipes the size of which represents a significant risk;

(f) that the risk of inadvertent discharge is minimised; the take-off points shall be

clearly marked on the permanent side, indicating the fluid contained;

(g) that the position and route of underground piping is at least recorded in the

technical documentation to facilitate safe maintenance, inspection or repair.

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7. SPECIFIC QUANTITATIVE REQUIREMENTS FOR CERTAIN PRESSURE

EQUIPMENT

The following provisions apply as a general rule. However, where they are not applied,

including in cases where materials are not specifically referred to and no harmonised

standards are applied, the manufacturer shall demonstrate that appropriate measures

have been taken to achieve an equivalent overall level of safety.

The provisions laid down in this section supplement the essential safety requirements

of points 1 to 6 for the pressure equipment to which they apply.

7.1. Allowable stresses

7.1.1. Symbols

Re/t, yield limit, indicates the value at the calculation temperature of:

– the upper flow limit for a material presenting upper and lower flow limits;

– the 1,0 % proof strength of austenitic steel and non-alloyed aluminium;

– the 0,2 % proof strength in other cases.

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Rm/20 indicates the minimum value of the ultimate tensile strength at 20 °C.

Rm/t designates the ultimate tensile strength at the calculation temperature.

7.1.2. The permissible general membrane stress for predominantly static loads and for

temperatures outside the range in which creep is significant shall not exceed the

smaller of the following values, according to the material used:

– in the case of ferritic steel including normalized (normalized rolled) steel and

excluding fine-grained steel and specially heat-treated steel, ²/3 of Re/t and 5/12 of

Rm/20;

– in the case of austenitic steel:

– if its elongation after rupture exceeds 30 %, ²/3 of Re/t

– or, alternatively, and if its elongation after rupture exceeds 35 %, 5/6 of Re/t

and 1/3 of Rm/t;

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– in the case of non-alloy or low-alloy cast steel, 10/19 of Re/t and 1/3 of Rm/20;

– in the case of aluminium, 2/3 of Re/t;

– in the case of aluminium alloys excluding precipitation hardening alloys 2/3 of Re/t

and 5/12 of Rm/20.

7.2. Joint coefficients

For welded joints, the joint coefficient shall not exceed the following values:

– for equipment subject to destructive and non-destructive tests which confirm that

the whole series of joints show no significant defects: 1;

– for equipment subject to random non-destructive testing: 0,85;

– for equipment not subject to non-destructive testing other than visual inspection:

0,7.

If necessary, the type of stress and the mechanical and technological properties of the

joint shall also be taken into account.

7.3. Pressure limiting devices, particularly for pressure vessels

The momentary pressure surge referred to in point 2.11.2 shall be kept to 10 % of the

maximum allowable pressure.

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7.4. Hydrostatic test pressure

For pressure vessels, the hydrostatic test pressure referred to in point 3.2.2 shall be no

less than either of the following:

– that corresponding to the maximum loading to which the pressure equipment

may be subject in service taking into account its maximum allowable pressure

and its maximum allowable temperature, multiplied by the coefficient 1,25;

– the maximum allowable pressure multiplied by the coefficient 1,43, whichever is

the greater.

7.5. Material characteristics

Unless other values are required in accordance with other criteria that shall be taken

into account, a steel is considered as sufficiently ductile to satisfy point 4.1(a) if, in a

tensile test carried out by a standard procedure, its elongation after rupture is no less

than 14 % and its bending rupture energy measured on an ISO V test-piece is no less

than 27 J, at a temperature not greater than 20 °C but not higher than the lowest

scheduled operating temperature.

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ANNEX II

CONFORMITY ASSESSMENT TABLES

1. The references in the tables to categories of modules are the following:

I = Module A

II = Modules A2, D1, E1

III = Modules B (design type) + D, B (design

type) + F, B (▌ production type ▌) + E, B

(▌ production type ▌) + C2, H

IV = Modules B (▌ production type ▌) + D, B (▌

production type ▌) + F, G, H1

2. The safety accessories defined in point 4 of Article 2▌, and referred to in Article 4(1)

(d), are classified in category IV. However, by way of exception, safety accessories

manufactured for specific equipment may be classified in the same category as the

equipment they protect.

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3. The pressure accessories defined in point 5 of Article 2 ▌, and referred to in Article

4(1)(d), are classified on the basis of:

– their maximum allowable pressure PS;

– their volume V or their nominal size DN, as appropriate;

– the group of fluids for which they are intended.

The appropriate table for vessels or piping is to be used to determine the conformity

assessment category.

Where both the volume and the nominal size are considered appropriate in the second

indent of the first subparagraph, the pressure accessory shall be classified in the

highest category.

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4. The demarcation lines in the following conformity assessment tables indicate the upper

limit for each category.

Table 1

Vessels referred to in Article 4(1)(a)(i), first indent

Exceptionally, vessels intended to contain an unstable gas and falling within categories I or II

on the basis of table 1 shall be classified in category III.

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Table 2

Vessels referred to in Article 4(1)(a)(i), second indent

Exceptionally, portable extinguishers and bottles for breathing equipment shall be classified at

least in category III.

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Table 3

Vessels referred to in Article 4(1)(a)(ii), first indent

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Table 4

Vessels referred to in Article 4(1)(a)(ii), second indent

Exceptionally, assemblies intended for generating warm water as referred to in the second

subparagraph of Article 4(2), shall be subject either to an EU-type examination (Module B -

design type) with respect to their conformity with the essential requirements referred to in

points 2.10, 2.11, 3.4, 5 (a) and 5 (d) of Annex I, or to full quality assurance (Module H).

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Article 4, paragraph 3

PS=1000

Table 5

Pressure equipment referred to in Article 4(1)(b)

Exceptionally, the design of pressure-cookers shall be subject to a conformity assessment

procedure equivalent to at least one of the category III modules.

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Table 6

Piping referred to in Article 4(1)(c)(i), first indent

Exceptionally, piping intended for unstable gases and falling within categories I or II on the

basis of Table 6 shall be classified in category III.

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Table 7

Piping referred to in Article 4(1)(c)(i), second indent

Exceptionally, all piping containing fluids at a temperature greater than 350 °C and falling

within category II on the basis of Table 7 shall be classified in category III.

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Table 8

Piping referred to in Article 4(1)(c)(ii), first indent

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Table 9

Piping referred to in Article 4(1)(c)(ii), second indent

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ANNEX III

CONFORMITY ASSESSMENT PROCEDURES

The obligations arising from the provisions on pressure equipment in this Annex also apply to

assemblies.

1. MODULE A: (INTERNAL PRODUCTION CONTROL)

1. Internal production control is the conformity assessment procedure whereby the

manufacturer fulfils the obligations laid down in points 2, 3 and 4, and ensures and

declares on his sole responsibility that the pressure equipment concerned satisfy the

requirements of this Directive.

2. Technical documentation

The manufacturer shall establish the technical documentation.

The technical documentation shall make it possible to assess the conformity of the

pressure equipment to the relevant requirements, and shall include an adequate

analysis and assessment of the risk(s). The technical documentation shall specify the

applicable requirements and cover, as far as relevant for the assessment, the design,

manufacture and operation of the pressure equipment. The technical documentation

shall, wherever applicable, contain at least the following elements:

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– a general description of the pressure equipment;

– conceptual design and manufacturing drawings and diagrams of components,

sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for an understanding of those drawings

and diagrams and the operation of the pressure equipment;

– a list of the harmonised standards the references of which have been published in

the Official Journal of the European Union, applied in full or in part, and a

description of the solutions adopted to meet the essential safety requirements of

this Directive where those harmonised standards have not been applied. In the

event of partly applied harmonised standards, the technical documentation shall

specify the parts which have been applied;

– results of design calculations made, examinations carried out, etc.;

– test reports.

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3. Manufacturing

The manufacturer shall take all measures necessary so that the manufacturing process

and its monitoring ensure compliance of the manufactured pressure equipment with the

technical documentation referred to in point 2 and with the requirements of this

Directive.

4. CE marking and EU declaration of conformity

4.1. The manufacturer shall affix the CE marking to each individual pressure equipment

that satisfies the applicable requirements of this Directive.

4.2. The manufacturer shall draw up a written EU declaration of conformity for the

pressure equipment model and keep it together with the technical documentation at the

disposal of the national authorities for 10 years after the pressure equipment has been

placed on the market. The EU declaration of conformity shall identify the pressure

equipment for which it has been drawn up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

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5. Authorised representative

The manufacturer's obligations set out in point 4 may be fulfilled by his authorised

representative, on his behalf and under his responsibility, provided that they are

specified in the mandate.

2. MODULE A2: INTERNAL PRODUCTION CONTROL PLUS SUPERVISED

PRESSURE EQUIPMENT CHECKS AT RANDOM INTERVALS

1. Internal production control plus supervised pressure equipment checks at random

intervals is the conformity assessment procedure whereby the manufacturer fulfils the

obligations laid down in points 2, 3, 4 and 5, and ensures and declares on his sole

responsibility that the pressure equipment concerned satisfy the requirements of this

Directive.

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2. Technical documentation

The manufacturer shall establish the technical documentation. The documentation shall

make it possible to assess the conformity of the pressure equipment with the relevant

requirements, and shall include an adequate analysis and assessment of the risk(s). The

technical documentation shall specify the applicable requirements and cover, as far as

relevant for the assessment, the design, manufacture and operation of the pressure

equipment. The technical documentation shall contain, wherever applicable, at least

the following elements:

– a general description of the pressure equipment;

– conceptual design and manufacturing drawings and diagrams of components,

sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for the understanding of those drawings

and diagrams and the operation of the pressure equipment;

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– a list of the harmonised standards the references of which have been published in

the Official Journal of the European Union, applied in full or in part, and

descriptions of the solutions adopted to meet the essential safety requirements of

this Directive where those harmonised standards have not been applied. In the

event of partly applied harmonised standards, the technical documentation shall

specify the parts which have been applied;

– results of design calculations made, examinations carried out, etc., and

– test reports.

3. Manufacturing

The manufacturer shall take all measures necessary so that the manufacturing process

and its monitoring ensure compliance of the manufactured pressure equipment with the

technical documentation referred to in point 2 and with the requirements of this

Directive that apply to it.

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4. Final assessment and pressure equipment checks

The manufacturer shall perform a final assessment of the pressure equipment,

monitored by means of unexpected visits by a notified body chosen by the

manufacturer.

The notified body shall carry out product checks or have them carried out at random

intervals determined by the body, in order to verify the quality of the internal checks of

the pressure equipment, taking into account inter alia the technological complexity of

the pressure equipment and the quantity of production.

During its unexpected visits, the notified body shall:

– establish that the manufacturer actually performs final assessment in accordance

with point 3.2 of Annex I.

– take samples of pressure equipment at the manufacturing or storage premises in

order to conduct checks. The notified body assesses the number of items of

equipment to sample and whether it is necessary to perform, or have performed,

all or part of the final assessment of the pressure equipment samples.

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The acceptance sampling procedure to be applied is intended to determine whether the

manufacturing process of the pressure equipment performs within acceptable limits,

with a view to ensuring conformity of the pressure equipment.

Should one or more of the items of pressure equipment or assembly not conform, the

notified body shall take appropriate measures.

The manufacturer shall, under the responsibility of the notified body, affix the notified

body's identification number during the manufacturing process.

5. CE marking and EU declaration of conformity

5.1. The manufacturer shall affix the CE marking to each individual pressure equipment

that satisfies the applicable requirements of this Directive.

5.2. The manufacturer shall draw up a written EU declaration of conformity for the

pressure equipment model and keep it together with the technical documentation at the

disposal of the national authorities for 10 years after the pressure equipment has been

placed on the market. The EU declaration of conformity shall identify the pressure

equipment for which it has been drawn up.

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A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

6. Authorised representative

The manufacturer's obligations set out in point 5 may be fulfilled by his authorised

representative, on his behalf and under his responsibility, provided that they are

specified in the mandate.

3. MODULE B: EU-TYPE EXAMINATION

3.1. EU-TYPE EXAMINATION – ▌ PRODUCTION TYPE ▌

1. EU-type examination - ▌ production type ▌ is the part of a conformity assessment

procedure in which a notified body examines the technical design of the pressure

equipment and verifies and attests that the technical design of the pressure equipment

meets the requirements of this Directive.

2. EU-type examination - ▌ production type ▌ shall consist of an assessment of the

adequacy of the technical design of the pressure equipment through examination of the

technical documentation and supporting evidence referred to in point 3, plus

examination of a specimen, representative of the production envisaged, of the

complete pressure equipment.

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3. The manufacturer shall lodge an application for EU-type examination with a single

notified body of his choice.

The application shall include:

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

– a written declaration that the same application has not been lodged with any

other notified body;

– the technical documentation. The technical documentation shall make it possible

to assess the conformity of the pressure equipment with the applicable

requirements of this Directive and shall include an adequate analysis and

assessment of the risk(s). The technical documentation shall specify the

applicable requirements and cover, as far as relevant for the assessment, the

design, manufacture and operation of the pressure equipment. The technical

documentation shall contain, wherever applicable, at least the following

elements:

– a general description of the pressure equipment;

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– conceptual design and manufacturing drawings and diagrams of

components, sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for the understanding of those

drawings and diagrams and the operation of the pressure equipment;

– a list of the harmonised standards the references of which have been

published in the Official Journal of the European Union, applied in full or

in part, and descriptions of the solutions adopted to meet the essential

safety requirements of this Directive where those harmonised standards

have not been applied. In the event of partly applied harmonised standards,

the technical documentation shall specify the parts which have been

applied;

– results of design calculations made, examinations carried out, etc.;

– test reports;

– information concerning the tests provided for in manufacture;

– information concerning the qualifications or approvals required under

points 3.1.2 and 3.1.3 of Annex I;

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– the specimens representative of the production envisaged.

The specimen may cover several versions of the pressure equipment provided that the

differences between the versions do not affect the level of safety.

The notified body may request further specimens if needed for carrying out the test

programme;

– the supporting evidence for the adequacy of the technical design solution. This

supporting evidence shall mention any documents that have been used, in

particular where the relevant harmonised standards have not been applied in full.

The supporting evidence shall include, where necessary, the results of tests

carried out by the appropriate laboratory of the manufacturer applying other

relevant technical specifications, or by another testing laboratory on his behalf

and under his responsibility.

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4. The notified body shall:

4.1. examine the technical documentation and supporting evidence to assess the adequacy

of the technical design of the pressure equipment and the manufacturing procedures.

In particular, the notified body shall:

– assess the materials where these are not in conformity with the relevant

harmonised standards or with a European approval for pressure equipment

materials, and check the certificate issued by the material manufacturer in

accordance with point 4.3 of Annex I;

– approve the procedures for the permanent joining of pressure equipment parts, or

check that they have been previously approved in accordance with point 3.1.2 of

Annex I;

– verify that the personnel undertaking the permanent joining of pressure

equipment parts and the non-destructive tests are qualified or approved in

accordance with points 3.1.2 or 3.1.3 of Annex I.

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4.2. verify that the specimen(s) have been manufactured in conformity with the technical

documentation and identify the elements which have been designed in accordance with

the applicable provisions of the relevant harmonised standards as well as the elements

which have been designed using other relevant technical specifications without

applying the relevant provisions of those standards.

4.3. carry out appropriate examinations and necessary tests to check whether when the

manufacturer has chosen to apply the solutions in the relevant harmonised standards,

these have been applied correctly.

4.4. carry out appropriate examinations and necessary tests to check whether, where the

solutions in the relevant harmonised standards have not been applied, the solutions

adopted by the manufacturer applying other relevant technical specifications meet the

corresponding essential safety requirements of this Directive.

4.5. agree with the manufacturer on a location where the examinations and tests will be

carried out.

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5. The notified body shall draw up an evaluation report that records the activities

undertaken in accordance with point 4 and their outcomes. Without prejudice to its

obligations vis-à-vis the notifying authority, the notified body shall release the content

of that report, in full or in part, only with the agreement of the manufacturer.

6. Where the type meets the requirements of this Directive, the notified body shall issue

an EU-type examination certificate – ▌ production type ▌ to the manufacturer.

Without prejudice to point 7, the certificate shall be valid for ▌ 10 years and be

renewable and shall contain the name and address of the manufacturer, the conclusions

of the examination, the conditions (if any) for its validity and the necessary data for

identification of the approved type.

A list of the relevant parts of the technical documentation shall be annexed to the

certificate and a copy kept by the notified body.

The certificate and its annexes shall contain all relevant information to allow the

conformity of manufactured pressure equipment with the examined type to be

evaluated and to allow for in-service control.

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Where the type does not satisfy the applicable requirements of this Directive, the

notified body shall refuse to issue an EU-type examination certificate – ▌ production

type ▌ and shall inform the applicant accordingly, giving detailed reasons for its

refusal. Provision shall be made for an appeals procedure.

7. The notified body shall keep itself apprised of any changes in the generally

acknowledged state of the art which indicate that the approved type may no longer

comply with the applicable requirements of this Directive, and shall determine whether

such changes require further investigation. If so, the notified body shall inform the

manufacturer accordingly.

The manufacturer shall inform the notified body that holds the technical

documentation relating to the EU-type examination certificate – production type of all

modifications to the approved type that may affect the conformity of the pressure

equipment with the essential safety requirements of this Directive or the conditions for

validity of the certificate. Such modifications shall require additional approval in the

form of an addition to the original EU- type examination certificate – production type.

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8. Each notified body shall inform its notifying authority concerning the EU-type

examination certificates – ▌ production type ▌ and/or any additions thereto which it

has issued or withdrawn, and shall, periodically or upon request, make available to its

notifying authorities the list of certificates and/or any additions thereto refused,

suspended or otherwise restricted.

Each notified body shall inform the other notified bodies concerning the EU-type

examination certificates – ▌ production type ▌ and/or any additions thereto which it

has refused, withdrawn, suspended or otherwise restricted, and, upon request,

concerning the certificates and/or additions thereto which it has issued.

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The Commission, the Member States and the other notified bodies may, on request,

obtain a copy of the EU-type examination certificates – ▌ production type ▌ and/or

additions thereto. On request, the Commission and the Member States may obtain a

copy of the technical documentation and the results of the examinations carried out by

the notified body. The notified body shall keep a copy of the EU-type examination

certificate – ▌ production type ▌, its annexes and additions, as well as the technical

file including the documentation submitted by the manufacturer, until the expiry of the

validity of the certificate.

9. The manufacturer shall keep a copy of the EU-type examination certificate – ▌

production type ▌, its annexes and additions together with the technical documentation

at the disposal of the national authorities for 10 years after the pressure equipment has

been placed on the market.

10. The manufacturer's authorised representative may lodge the application referred to in

point 3 and fulfil the obligations set out in points 7 and 9, provided that they are

specified in the mandate.

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3.2. EU-TYPE EXAMINATION – DESIGN TYPE

1. EU-type examination – design type is the part of a conformity assessment procedure in

which a notified body examines the technical design of the pressure equipment and

verifies and attests that the technical design of the pressure equipment meets the

requirements of this Directive.

2. The EU-type examination – design type shall consist of an assessment of the adequacy

of the technical design of the pressure equipment through examination of the technical

documentation and supporting evidence referred to in point 3, without examination of

a specimen.

The experimental design method provided for in point 2.2.4 of Annex I shall not be

used in the context of this module.

3. The manufacturer shall lodge an application for EU-type examination - design type

with a single notified body of his choice.

The application shall include:

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

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– a written declaration that the same application has not been lodged with any

other notified body;

– the technical documentation. The technical documentation shall make it possible

to assess the conformity of the pressure equipment with the applicable

requirements of the Directive and shall include an adequate analysis and

assessment of the risk(s). The technical documentation shall specify the

applicable requirements and cover, as far as relevant for the assessment, the

design, manufacture and operation of the pressure equipment. The technical

documentation shall contain, wherever applicable, at least the following

elements:

– a general description of the pressure equipment;

– conceptual design and manufacturing drawings and diagrams of

components, sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for the understanding of those

drawings and diagrams and the operation of the pressure equipment;

488

– a list of the harmonised standards the references of which have been

published in the Official Journal of the European Union, applied in full or

in part, and descriptions of the solutions adopted to meet the essential

safety requirements of this Directive where those harmonised standards

have not been applied. In the event of partly applied harmonised standards,

the technical documentation shall specify the parts which have been

applied;

– results of design calculations made, examinations carried out, etc.;

– information regarding the qualifications or approvals required under points

3.1.2 and 3.1.3 of Annex I;

– the supporting evidence for the adequacy of the technical design solution. This

supporting evidence shall mention any documents that have been used, in

particular where the relevant harmonised standards have not been applied in full.

This supporting evidence shall include, where necessary, the results of tests

carried out by the appropriate laboratory of the manufacturer or by another

testing laboratory on his behalf and under his responsibility.

The application may cover several versions of the pressure equipment provided that

the differences between the versions do not affect the level of safety.

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4. The notified body shall:

4.1. examine the technical documentation and supporting evidence to assess the adequacy

of the technical design of the product.

In particular, the notified body shall:

– assess the materials where these are not in conformity with the relevant

harmonised standards or with a European approval for pressure equipment

materials;

– approve the procedures for the permanent joining of pressure equipment parts, or

check that they have been previously approved in accordance with point 3.1.2 of

Annex I.

4.2. carry out appropriate examinations to check whether where the manufacturer has

chosen to apply the solutions in the relevant harmonised standards these have been

applied correctly.

4.3. carry out appropriate examinations to check whether, where the solutions in the

relevant harmonised standards have not been applied, the solutions adopted by the

manufacturer meet the corresponding essential safety requirements of this Directive.

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5. The notified body shall draw up an evaluation report that records the activities

undertaken in accordance with point 4 and their outcomes. Without prejudice to its

obligations vis-à-vis the notifying authorities, the notified body shall release the

content of that report, in full or in part, only with the agreement of the manufacturer.

6. Where the design meets the requirements of this Directive, the notified body shall

issue an EU-type examination certificate - design type to the manufacturer. Without

prejudice to point 7, the certificate shall be valid for ▌ 10 years and be renewable and

shall contain the name and address of the manufacturer, the conclusions of the

examination, the conditions (if any) for its validity and the necessary data for

identification of the approved design.

A list of the relevant parts of the technical documentation shall be annexed to the

certificate and a copy kept by the notified body.

The certificate and its annexes shall contain all relevant information to allow the

conformity of manufactured pressure equipment with the examined design to be

evaluated and to allow for in-service control.

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Where the design does not satisfy the applicable requirements of this Directive, the

notified body shall refuse to issue an EU-type examination certificate - design type and

shall inform the applicant accordingly, giving detailed reasons for its refusal.

7. The notified body shall keep itself apprised of any changes in the generally

acknowledged state of the art which indicate that the approved design may no longer

comply with the applicable requirements of this Directive, and shall determine whether

such changes require further investigation. If so, the notified body shall inform the

manufacturer accordingly.

The manufacturer shall inform the notified body that holds the technical

documentation relating to the EU-type examination certificate - design type of all

modifications to the approved design that may affect the conformity of the pressure

equipment with the essential safety requirements of this Directive or the conditions for

validity of the certificate. Such modifications shall require additional approval in the

form of an addition to the original EU-type examination certificate - design type.

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8. Each notified body shall inform its notifying authorities concerning the EU-type

examination certificates - design type and/or any additions thereto which it has issued

or withdrawn, and shall, periodically or upon request, make available to its notifying

authorities the list of certificates and/or any additions thereto refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies concerning the EU-type

examination certificates - design type and/or any additions thereto which it has refused,

withdrawn, suspended or otherwise restricted, and, upon request, concerning the

certificates and/or additions thereto which it has issued.

The Commission, the Member States and the other notified bodies may, on request,

obtain a copy of the EU-type examination certificates - design type and/or additions

thereto. On request, the Commission and the Member States may obtain a copy of the

technical documentation and the results of the examinations carried out by the notified

body. The notified body shall keep a copy of the EU-type examination certificate -

design type, its annexes and additions, as well as the technical file including the

documentation submitted by the manufacturer, until the expiry of the validity of the

certificate.

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9. The manufacturer shall keep a copy of the EU-type examination certificate - design

type, its annexes and additions together with the technical documentation at the

disposal of the national authorities for 10 years after the pressure equipment has been

placed on the market.

10. The manufacturer's authorised representative may lodge the application referred to in

point 3 and fulfil the obligations set out in points 7 and 9, provided that they are

specified in the mandate.

4. MODULE C2: CONFORMITY TO TYPE BASED ON INTERNAL PRODUCTION

CONTROL PLUS SUPERVISED PRESSURE EQUIPMENT CHECKS AT

RANDOM INTERVALS

1. Conformity to type based on internal production control plus supervised pressure

equipment checks at random intervals is the part of a conformity assessment procedure

whereby the manufacturer fulfils the obligations laid down in points 2, 3 and 4, and

ensures and declares on his sole responsibility that the pressure equipment concerned

is in conformity with the type described in the EU-type examination certificate and

satisfy the requirements of this Directive that apply to it.

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2. Manufacturing

The manufacturer shall take all measures necessary so that the manufacturing process

and its monitoring ensure conformity of the manufactured pressure equipment with the

type described in the EU-type examination certificate and with the requirements of this

Directive that apply to them.

3. Final assessment and pressure equipment checks

A notified body, chosen by the manufacturer, shall carry out checks or have them

carried out at random intervals determined by the body, in order to verify the quality of

the final assessment and of the internal checks on the pressure equipment, taking into

account inter alia the technological complexity of the pressure equipment and the

quantity of production.

The notified body shall establish that the manufacturer actually performs final

assessment in accordance with point 3.2 of Annex I.

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An adequate sample of the final pressure equipment, taken on site by the notified body

before the placing on the market, shall be examined and appropriate tests as identified

by the relevant parts of the harmonised standards, and/or equivalent tests applying

other technical specifications, shall be carried out to check the conformity of the

pressure equipment with the relevant requirements of this Directive.

The notified body shall assess the number of items of equipment to sample and

whether it is necessary to perform, or have performed, all or part of final assessment

on the pressure equipment samples.

Where a sample does not conform to the acceptable quality level, the body shall take

appropriate measures.

The acceptance sampling procedure to be applied is intended to determine whether the

manufacturing process of the pressure equipment performs within acceptable limits,

with a view to ensuring conformity of the pressure equipment.

Where the tests are carried out by a notified body, the manufacturer shall, under the

responsibility of the notified body, affix the notified body's identification number

during the manufacturing process.

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4. CE marking and EU declaration of conformity

4.1. The manufacturer shall affix the CE marking to each individual pressure equipment or

assembly that is in conformity with the type described in the EU-type examination

certificate and satisfies the applicable requirements of this Directive.

4.2. The manufacturer shall draw up a written EU declaration of conformity for a pressure

equipment model and keep it at the disposal of the national authorities for 10 years

after the pressure equipment has been placed on the market. The EU declaration of

conformity shall identify the pressure equipment model for which it has been drawn

up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

5. Authorised representative

The manufacturer's obligations set out in point 4 may be fulfilled by his authorised

representative, on his behalf and under his responsibility, provided that they are

specified in the mandate.

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5. MODULE D: CONFORMITY TO TYPE BASED ON QUALITY ASSURANCE OF

THE PRODUCTION PROCESS

1. Conformity to type based on quality assurance of the production process is that part of

a conformity assessment procedure whereby the manufacturer fulfils the obligations

laid down in points 2 and 5, and ensures and declares on his sole responsibility that the

pressure equipment or assembly concerned is in conformity with the type described in

the EU-type examination certificate and satisfies the requirements of this Directive that

apply to it.

2. Manufacturing

The manufacturer shall operate an approved quality system for production, final

product inspection and testing of the pressure equipment concerned as specified in

point 3 and shall be subject to surveillance as specified in point 4.

3. Quality system

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3.1. The manufacturer shall lodge an application for assessment of his quality system with

the notified body of his choice for the pressure equipment concerned.

The application shall include:

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

– a written declaration that the same application has not been lodged with any

other notified body;

– all relevant information on the pressure equipment type envisaged;

– the documentation concerning the quality system;

– the technical documentation of the approved type and a copy of the EU-type

examination certificate.

3.2. The quality system shall ensure that the pressure equipment is in conformity with the

type described in the EU-type examination certificate and comply with the

requirements of this Directive that apply to it.

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All the elements, requirements and provisions adopted by the manufacturer shall be

documented in a systematic and orderly manner in the form of written policies,

procedures and instructions. This quality system documentation shall permit a

consistent interpretation of the quality programmes, plans, manuals and records.

It shall, in particular, contain an adequate description of:

– the quality objectives and the organisational structure, responsibilities and

powers of the management with regard to the quality of the pressure equipment;

– the corresponding manufacturing, quality control and quality assurance

techniques, processes and systematic actions that will be used, particularly the

procedures used for the permanent joining of parts as approved in accordance

with point 3.1.2 of Annex I;

– the examinations and tests that will be carried out before, during and after

manufacture, and the frequency with which they will be carried out;

– the quality records, such as inspection reports and test data, calibration data,

reports concerning the qualifications or approvals of the personnel concerned,

particularly those of the personnel undertaking the permanent joining of parts

and the non-destructive tests in accordance with points 3.1.2 and 3.1.3 of Annex

I, etc.; and

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– the means of monitoring the achievement of the required quality and the

effective operation of the quality system.

3.3. The notified body shall assess the quality system to determine whether it satisfies the

requirements referred to in point 3.2.

It shall presume conformity with those requirements in respect of the elements of the

quality system that comply with the corresponding specifications of the ▌ relevant

harmonised standard.

In addition to experience in quality management systems, the auditing team shall have

at least one member with experience of evaluation in the relevant pressure equipment

field and pressure equipment technology concerned, and knowledge of the applicable

requirements of this Directive. The audit shall include an inspection visit to the

manufacturer's premises.

The auditing team shall review the technical documentation referred to in point 3.1,

fifth indent, to verify the manufacturer's ability to identify the relevant requirements of

this Directive and to carry out the necessary examinations with a view to ensuring

compliance of the product with those requirements.

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The decision shall be notified to the manufacturer. The notification shall contain the

conclusions of the audit and the reasoned assessment decision.

3.4. The manufacturer shall undertake to fulfil the obligations arising out of the quality

system as approved and to maintain it so that it remains adequate and efficient.

3.5. The manufacturer shall keep the notified body that has approved the quality system

informed of any intended change to the quality system.

The notified body shall evaluate the proposed changes and decide whether the

modified quality system will continue to satisfy the requirements referred to in point

3.2 or whether a reassessment is necessary.

It shall notify the manufacturer of its decision. The notification shall contain the

conclusions of the examination and the reasoned assessment decision.

4. Surveillance under the responsibility of the notified body

502

4.1. The purpose of surveillance is to make sure that the manufacturer duly fulfils the

obligations arising out of the approved quality system.

4.2. The manufacturer shall, for assessment purposes, allow the notified body access to the

manufacture, inspection, testing and storage sites and shall provide it with all

necessary information, in particular:

– the quality system documentation;

– the quality records, such as inspection reports and test data, calibration data,

qualification reports of the personnel concerned, etc.

4.3. The notified body shall carry out periodic audits to make sure that the manufacturer

maintains and applies the quality system and provide the manufacturer with an audit

report. The frequency of periodic audits shall be such that a full reassessment is carried

out every three years.

503

4.4. In addition the notified body may pay unexpected visits to the manufacturer. The need

for such additional visits, and the frequency thereof, will be determined on the basis of

a visit control system operated by the notified body. In particular, the following factors

shall be considered in the visit control system:

– the category of the pressure equipment;

– the results of previous surveillance visits;

– the need to follow up corrective actions;

– special conditions linked to the approval of the system, where applicable;

– significant changes in manufacturing organisation, policy or techniques.

During such visits the notified body may, if necessary, carry out product tests or have

them carried out in order to verify that the quality system is functioning correctly. The

notified body shall provide the manufacturer with a visit report and, if tests have been

carried out, with a test report.

504

5. CE marking and EU declaration of conformity

5.1. The manufacturer shall affix the CE marking and, under the responsibility of the

notified body referred to in point 3.1, the latter's identification number to each

individual pressure equipment that is in conformity with the type described in the

EU-type examination certificate and satisfies the applicable requirements of this

Directive.

5.2. The manufacturer shall draw up a written EU declaration of conformity for each

pressure equipment model and keep it at the disposal of the national authorities for 10

years after the pressure equipment has been placed on the market. The EU declaration

of conformity shall identify the pressure equipment model for which it has been drawn

up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

6. The manufacturer shall, for a period ending 10 years after the pressure equipment has

been placed on the market, keep at the disposal of the national authorities:

505

– the documentation referred to point 3.1;

– the change referred to in point 3.5, as approved;

– the decisions and reports of the notified body referred to in points 3.3, 3.5, 4.3

and 4.4.

7. Each notified body shall inform its notifying authorities of the quality system

approvals issued or withdrawn, and shall, periodically or upon request, make available

to its notifying authorities the list of quality system approvals refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies of the quality system

approvals which it has refused, suspended, withdrawn or otherwise restricted, and,

upon request, of quality system approvals which it has issued.

8. Authorised representative

The manufacturer's obligations set out in points 3.1, 3.5, 5 and 6 may be fulfilled by

his authorised representative, on his behalf and under his responsibility, provided that

they are specified in the mandate.

506

6. MODULE D1: QUALITY ASSURANCE OF THE PRODUCTION PROCESS

1. Quality assurance of the production process is the conformity assessment procedure

whereby the manufacturer fulfils the obligations laid down in points 2, 4 and 7, and

ensures and declares on his sole responsibility that the pressure equipment concerned

satisfy the requirements of this Directive that apply to it.

2. Technical documentation

The manufacturer shall establish the technical documentation. The documentation shall

make it possible to assess the conformity of the pressure equipment with the relevant

requirements and shall include an adequate analysis and assessment of the risk(s). The

technical documentation shall specify the applicable requirements and cover, as far as

relevant for the assessment, the design, manufacture and operation of the product. The

technical documentation shall, wherever applicable, contain at least the following

elements:

507

– a general description of the pressure equipment;

– conceptual design and manufacturing drawings and diagrams of components,

sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for an understanding of those drawings

and diagrams and the operation of the pressure equipment;

– a list of the harmonised standards the references of which have been published in

the Official Journal of the European Union, applied in full or in part, and

descriptions of the solutions adopted to meet the essential safety requirements of

this Directive where those harmonised standards have not been applied. In the

event of partly applied harmonised standards, the technical documentation shall

specify the parts which have been applied;

– results of design calculations made, examinations carried out, etc., and

– test reports.

508

3. The manufacturer shall keep the technical documentation at the disposal of the relevant

national authorities for 10 years after the pressure equipment has been placed on the

market.

4. Manufacturing

The manufacturer shall operate an approved quality system for production, final

product inspection and testing of the pressure equipment concerned as specified in

point 5, and shall be subject to surveillance as specified in point 6.

5. Quality system

5.1. The manufacturer shall lodge an application for assessment of his quality system with

the notified body of his choice for the pressure equipment concerned.

The application shall include:

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

509

– a written declaration that the same application has not been lodged with any

other notified body;

– all relevant information on the pressure equipment type envisaged;

– the documentation concerning the quality system;

– the technical documentation referred to in point 2.

5.2. The quality system shall ensure compliance of the pressure equipment with the

requirements of this Directive that apply to it.

All the elements, requirements and provisions adopted by the manufacturer shall be

documented in a systematic and orderly manner in the form of written policies,

procedures and instructions. This quality system documentation shall permit a

consistent interpretation of the quality programmes, plans, manuals and records.

It shall, in particular, contain an adequate description of:

510

– the quality objectives and the organisational structure, responsibilities and

powers of the management with regard to the quality of the pressure equipment;

– the corresponding manufacturing, quality control and quality assurance

techniques, processes and systematic measures that will be used, particularly the

procedures used for the permanent joining of parts as approved in accordance

with point 3.1.2 of Annex I;

– the examinations and tests that will be carried out before, during and after

manufacture, and the frequency with which they will be carried out;

– the quality records, such as inspection reports and test data, calibration data,

reports concerning the qualifications or approvals of the personnel concerned,

particularly those of the personnel undertaking the permanent joining of parts in

accordance with point 3.1.2 of Annex I, etc.;

– the means of monitoring the achievement of the required product quality and the

effective operation of the quality system.

511

5.3. The notified body shall assess the quality system to determine whether it satisfies the

requirements referred to in point 5.2. The elements of the quality system which

conform to the relevant harmonised standard are presumed to comply with the

corresponding requirements referred to in point 5.2.

In addition to experience in quality management systems, the auditing team shall have

at least one member with experience of evaluation in the pressure equipment

technology concerned, and the knowledge of the applicable requirements of this

Directive. The audit shall include an assessment visit to the manufacturer's premises.

The auditing team shall review the technical documentation referred to in point 2 in

order to verify the manufacturer's ability to identify the relevant requirements of this

Directive and to carry out the necessary examinations with a view to ensuring

compliance of the pressure equipment with those requirements.

The decision shall be notified to the manufacturer. The notification shall contain the

conclusions of the audit and the reasoned assessment decision.

512

5.4. The manufacturer shall undertake to fulfil the obligations arising out of the quality

system as approved and to maintain it so that it remains adequate and efficient.

5.5. The manufacturer shall keep the notified body that has approved the quality system

informed of any intended change to the quality system.

The notified body shall evaluate any proposed changes and decide whether the

modified quality system will continue to satisfy the requirements referred to in point

5.2 or whether a reassessment is necessary.

It shall notify the manufacturer of its decision. The notification shall contain the

conclusions of the examination and the reasoned assessment decision.

6. Surveillance under the responsibility of the notified body

6.1. The purpose of surveillance is to make sure that the manufacturer duly fulfils the

obligations arising out of the approved quality system.

513

6.2. The manufacturer shall, for assessment purposes, allow the notified body access to the

manufacture, inspection, testing and storage sites and shall provide it with all

necessary information, in particular:

– the quality system documentation;

– the technical documentation referred to in point 2;

– the quality records, such as inspection reports and test data, calibration data,

qualification reports of the personnel concerned, etc.

6.3. The notified body shall carry out periodic audits to make sure that the manufacturer

maintains and applies the quality system and provide the manufacturer with an audit

report. The frequency of periodic audits shall be such that a full reassessment is carried

out every three years.

514

6.4. In addition the notified body may pay unexpected visits to the manufacturer. The need

for such additional visits, and the frequency thereof, will be determined on the basis of

a visit control system operated by the notified body. In particular, the following factors

shall be considered in the visit control system:

– the category of the pressure equipment;

– the results of previous surveillance visits;

– the need to follow up corrective action(s);

– special conditions linked to the approval of the system, where applicable;

– significant changes in manufacturing organisation, policy or techniques.

During such visits the notified body may, if necessary, carry out product tests, or have

them carried out, in order to verify that the quality system is functioning correctly. The

notified body shall provide the manufacturer with a visit report and, if tests have been

carried out, with a test report.

515

7. CE marking and EU declaration of conformity

7.1. The manufacturer shall affix the CE marking and, under the responsibility of the

notified body referred to in point 5.1, the latter's identification number to each

individual pressure equipment that satisfies the applicable requirements of this

Directive.

7.2. The manufacturer shall draw up a written EU declaration of conformity for each

pressure equipment model and keep it at the disposal of the national authorities for 10

years after the pressure equipment has been placed on the market. The EU declaration

of conformity shall identify the product model for which it has been drawn up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

8. The manufacturer shall, for a period ending 10 years after the pressure equipment has

been placed on the market, keep at the disposal of the national authorities:

516

– the documentation referred to in point 5.1;

– the change referred to in point 5.5;

– the decisions and reports of the notified body referred to in points 5.5, 6.3 and

6.4.

9. Each notified body shall inform its notifying authorities of the quality system

approvals issued or withdrawn, and shall periodically, or upon request, make available

to its notifying authorities the list of quality system approvals refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies of quality system approvals

which it has refused, suspended, or withdrawn, and upon request, of quality system

approvals which it has issued.

10. Authorised representative

The manufacturer's obligations set out in points 3, 5.1, 5.5, 7 and 8 may be fulfilled by

his authorised representative, on his behalf and under his responsibility, provided that

they are specified in the mandate.

517

7. MODULE E: CONFORMITY TO TYPE BASED ON PRESSURE EQUIPMENT

QUALITY ASSURANCE

1. Conformity to type based on pressure equipment quality assurance is that part of a

conformity assessment procedure whereby the manufacturer fulfils the obligations laid

down in points 2 and 5, and ensures and declares on his sole responsibility that the

pressure equipment concerned is in conformity with the type described in the EU-type

examination certificate and satisfies the requirements of this Directive that apply to it.

2. Manufacturing

The manufacturer shall operate an approved quality system for the final product

inspection and testing of the pressure equipment concerned as specified in point 3 and

shall be subject to surveillance as specified in point 4.

3. Quality system

3.1. The manufacturer shall lodge an application for assessment of his quality system with

the notified body of his choice, for the pressure equipment concerned.

518

The application shall include:

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

– a written declaration that the same application has not been lodged with any

other notified body;

– all relevant information on the pressure equipment type envisaged;

– the documentation concerning the quality system;

– the technical documentation of the approved type and a copy of the EU-type

examination certificate.

519

3.2. The quality system shall ensure compliance of the products with the type described in

the EU-type examination certificate and with the applicable requirements of this

Directive.

All the elements, requirements and provisions adopted by the manufacturer shall be

documented in a systematic and orderly manner in the form of written policies,

procedures and instructions. This quality system documentation shall permit a

consistent interpretation of the quality programmes, plans, manuals and records.

It shall, in particular, contain an adequate description of:

– the quality objectives and the organisational structure, responsibilities and

powers of the management with regard to product quality;

– the examinations and tests that will be carried out after manufacture;

– the quality records, such as inspection reports and test data, calibration data,

reports concerning the qualifications or approvals of the personnel concerned,

particularly those of the personnel undertaking the permanent joining of parts

and the non-destructive tests in accordance with points 3.1.2 and 3.1.3 of Annex

I;

– the means of monitoring the effective operation of the quality system.

520

3.3. The notified body shall assess the quality system to determine whether it satisfies the

requirements referred to in point 3.2. It shall presume conformity with those

requirements in respect of the elements of the quality system that comply with the

corresponding specifications of ▌the relevant harmonised standard ▌.

In addition to experience in quality management systems, the auditing team shall have

at least one member with experience of evaluation in the relevant pressure equipment

field and pressure equipment technology concerned and knowledge of the applicable

requirements of this Directive. The audit shall include an assessment visit to the

manufacturer's premises.

The auditing team shall review the technical documentation referred to in point 3.1,

fifth indent, in order to verify the manufacturer's ability to identify the relevant

requirements of this Directive and to carry out the necessary examinations with a view

to ensuring compliance of the pressure equipment with those requirements.

The decision shall be notified to the manufacturer. The notification shall contain the

conclusions of the audit and the reasoned assessment decision.

521

3.4. The manufacturer shall undertake to fulfil the obligations arising out of the quality

system as approved and to maintain it so that it remains adequate and efficient.

3.5. The manufacturer shall keep the notified body that has approved the quality system

informed of any intended change to the quality system.

The notified body shall evaluate any proposed changes and decide whether the

modified quality system will continue to satisfy the requirements referred to in point

3.2 or whether a reassessment is necessary.

It shall notify the manufacturer of its decision. The notification shall contain the

conclusions of the examination and the reasoned assessment decision.

4. Surveillance under the responsibility of the notified body

4.1. The purpose of surveillance is to make sure that the manufacturer duly fulfils the

obligations arising out of the approved quality system.

522

4.2. The manufacturer shall, for assessment purposes, allow the notified body access to the

manufacture, inspection, testing and storage sites and shall provide it with all

necessary information, in particular:

– the quality system documentation;

– the technical documentation;

– the quality records, such as inspection reports and test data, calibration data,

reports concerning the qualifications of the personnel concerned, etc.

4.3. The notified body shall carry out periodic audits to make sure that the manufacturer

maintains and applies the quality system and provide the manufacturer with an audit

report. The frequency of periodic audits must be such that a full reassessment is carried

out every three years.

523

4.4. In addition the notified body may pay unexpected visits to the manufacturer.

The need for such additional visits, and the frequency thereof, will be determined on

the basis of a visit control system operated by the notified body. In particular, the

following factors shall be considered in the visit control system:

– the category of the pressure equipment;

– the results of previous surveillance visits;

– the need to follow up corrective actions;

– special conditions linked to the approval of the system, where applicable;

– significant changes in manufacturing organisation, policy or techniques.

During such visits, the notified body may, if necessary, carry out product tests, or have

them carried out, in order to verify that the quality system is functioning correctly. The

notified body shall provide the manufacturer with a visit report and, if tests have been

carried out, with a test report.

524

5. CE marking and EU declaration of conformity

5.1. The manufacturer shall affix the CE marking and, under the responsibility of the

notified body referred to in point 3.1, the latter's identification number to each

individual pressure equipment that is in conformity with the type described in the

EU-type examination certificate and satisfies the applicable requirements of this

Directive.

5.2. The manufacturer shall draw up a written EU declaration of conformity for each

pressure equipment model and keep it at the disposal of the national authorities for 10

years after the pressure equipment has been placed on the market. The EU declaration

of conformity shall identify the product model for which it has been drawn up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

6. The manufacturer shall, for a period ending 10 years after the pressure equipment has

been placed on the market, keep at the disposal of the national authorities:

525

– the documentation referred to in point 3.1;

– the change referred to in point 3.5, as approved;

– the decisions and reports from the notified body which are referred to in points

3.3, 3.5, 4.3 and 4.4.

7. Each notified body shall inform its notifying authorities of quality system approvals

issued or withdrawn and shall, periodically or upon request, make available to its

notifying authorities the list of quality system approvals refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies of quality system approvals

which it has refused, suspended or withdrawn, and, upon request, of quality system

approvals which it has issued.

8. Authorised representative

The manufacturer's obligations set out in points 3.1, 3.5, 5 and 6 may be fulfilled by

his authorised representative, on his behalf and under his responsibility, provided that

they are specified in the mandate.

526

8. MODULE E1: QUALITY ASSURANCE OF FINAL PRESSURE EQUIPMENT

INSPECTION AND TESTING

1. Quality assurance of final pressure equipment inspection and testing is the conformity

assessment procedure whereby the manufacturer fulfils the obligations laid down in

points 2, 4 and 7, and ensures and declares on his sole responsibility that the pressure

equipment concerned satisfy the requirements of this Directive that apply to it.

2. Technical documentation

The manufacturer shall establish the technical documentation. The technical

documentation shall make it possible to assess the conformity of the pressure

equipment with the relevant requirements, and shall include an adequate analysis and

assessment of the risk(s) The technical documentation shall specify the applicable

requirements and cover, as far as relevant for the assessment, the design, manufacture

and operation of the pressure equipment. The technical documentation shall, wherever

applicable, contain at least the following elements:

– a general description of the pressure equipment;

527

– conceptual design and manufacturing drawings and diagrams of components,

sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for the understanding of those drawings

and diagrams and the operation of the pressure equipment;

– a list of the harmonised standards, the references of which have been published

in the Official Journal of the European Union, applied in full or in part, and

descriptions of the solutions adopted to meet the essential safety requirements of

this Directive where those harmonised standards have not been applied. In the

event of partly applied harmonised standards, the technical documentation shall

specify the parts which have been applied;

– results of design calculations made, examinations carried out, etc., and

– test reports.

528

3. The manufacturer shall keep the technical documentation at the disposal of the relevant

national authorities for 10 years after the pressure equipment has been placed on the

market.

4. Manufacturing

The manufacturer shall operate an approved quality system for the final product

inspection and testing of the pressure equipment as specified in point 5 and shall be

subject to surveillance as specified in point 6.

5. Quality system

5.1. The manufacturer shall lodge an application for assessment of his quality system with

the notified body of his choice, for the pressure equipment concerned.

The application shall include:

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

529

– a written declaration that the same application has not been lodged with any

other notified body;

– all relevant information on the pressure equipment type envisaged;

– the documentation concerning the quality system, and

– the technical documentation referred to in point 2.

5.2. The quality system shall ensure compliance of the pressure equipment with the

requirements of this Directive that apply to it.

Under the quality system, each item of pressure equipment shall be examined and

appropriate tests as set out in the relevant standard(s) referred to in Article 12, or

equivalent tests, and particularly final assessment as referred to in point 3.2 of Annex

I, shall be carried out in order to ensure its conformity with the requirements of this

Directive which apply to it.

530

All the elements, requirements and provisions adopted by the manufacturer shall be

documented in a systematic and orderly manner in the form of written policies,

procedures and instructions. This quality system documentation shall permit a

consistent interpretation of the quality programmes, plans, manuals and records.

It shall, in particular, contain an adequate description of:

– the quality objectives and the organisational structure, responsibilities and

powers of the management with regard to the quality of the pressure equipment;

– the procedures used for the permanent joining of parts as approved in accordance

with point 3.1.2 of Annex I;

– the examinations and tests that will be carried out after manufacture;

– the quality records, such as inspection reports and test data, calibration data,

reports concerning the qualifications or approvals of the personnel concerned,

particularly those of the personnel undertaking the permanent joining of parts in

accordance with point 3.1.2 of Annex I;

– the means of monitoring the effective operation of the quality system.

531

5.3. The notified body shall assess the quality system to determine whether it satisfies the

requirements referred to in point 5.2.

It shall presume conformity with those requirements in respect of the elements of the

quality system that comply with the corresponding specifications of the ▌ relevant

harmonised standard ▌.

In addition to experience in quality management systems, the auditing team shall have

at least one member with experience of evaluation in the relevant pressure equipment

field and pressure equipment technology concerned, and knowledge of the applicable

requirements of this Directive. The audit shall include an assessment visit to the

manufacturer's premises.

The auditing team shall review the technical documentation referred to in point 2 in

order to verify the manufacturer's ability to identify the relevant requirements of this

Directive and to carry out the necessary examinations with a view to ensuring

compliance of the pressure equipment with those requirements.

532

The decision shall be notified to the manufacturer. The notification shall contain the

conclusions of the audit and the reasoned assessment decision.

5.4. The manufacturer shall undertake to fulfil the obligations arising out of the quality

system as approved and to maintain it so that it remains adequate and efficient.

5.5. The manufacturer shall keep the notified body that has approved the quality system

informed of any intended change to the quality system.

The notified body shall evaluate any proposed changes and decide whether the

modified quality system will continue to satisfy the requirements referred to in point

5.2 or whether a reassessment is required.

It shall notify the manufacturer of its decision. The notification shall contain the

conclusions of the examination and the reasoned assessment decision.

6. Surveillance under the responsibility of the notified body

6.1. The purpose of surveillance is to make sure that the manufacturer duly fulfils the

obligations arising out of the approved quality system.

533

6.2. The manufacturer shall, for assessment purposes, allow the notified body access to the

manufacture, inspection, testing and storage sites and shall provide it with all

necessary information, in particular:

– the quality system documentation;

– the technical documentation referred to in point 2;

– the quality records, such as inspection reports and test data, calibration data,

qualification reports on the personnel concerned, etc.

6.3. The notified body shall carry out periodic audits to make sure that the manufacturer

maintains and applies the quality system and provide the manufacturer with an audit

report. The frequency of periodic audits shall be such that a full reassessment is carried

out every three years.

6.4. In addition the notified body may pay unexpected visits to the manufacturer. The need

for such additional visits, and the frequency thereof, will be determined on the basis of

a visit control system operated by the notified body. In particular, the following factors

shall be considered in the visit control system:

534

– the category of the equipment;

– the results of previous surveillance visits;

– the need to follow up corrective action(s);

– special conditions linked to the approval of the system, where applicable;

– significant changes in manufacturing organisation, policy or techniques.

During such visits the notified body may, if necessary, carry out product tests, or have

them carried out, in order to verify that the quality system is functioning correctly. The

notified body shall provide the manufacturer with a visit report and, if tests have been

carried out, with a test report.

7. CE marking and EU declaration of conformity

7.1. The manufacturer shall affix the CE marking and, under the responsibility of the

notified body referred to in point 5.1, the latter's identification number to each

individual pressure equipment that satisfies the applicable requirements of this

Directive.

535

7.2. The manufacturer shall draw up a written EU declaration of conformity for each

pressure equipment model and keep it at the disposal of the national authorities for 10

years after the pressure equipment has been placed on the market. The EU declaration

of conformity shall identify the pressure equipment model for which it has been drawn

up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

8. The manufacturer shall, for a period ending 10 years after the pressure equipment has

been placed on the market, keep at the disposal of the national authorities:

– the documentation referred to in point 5.1;

– the change referred to in point 5.5, as approved;

– the decisions and reports of the notified body referred to in points 5.3, 5.5, 6.3

and 6.4.

536

9. Each notified body shall inform its notifying authorities of quality system approvals

issued or withdrawn and shall periodically or upon request, make available to its

notifying authorities the list of quality system approvals refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies of quality system approvals

which it has refused, suspended or withdrawn, and, upon request, of quality system

approvals which it has issued.

10. Authorised representative

The manufacturer's obligations set out in points 3, 5.1, 5.5, 7 and 8 may be fulfilled by

his authorised representative, on his behalf and under his responsibility, provided that

they are specified in the mandate.

9. MODULE F: CONFORMITY TO TYPE BASED ON PRESSURE EQUIPMENT

VERIFICATION

537

1. Conformity to type based on pressure equipment verification is the part of a

conformity assessment procedure whereby the manufacturer fulfils the obligations laid

down in points 2 and 5, and ensures and declares on his sole responsibility that the

pressure equipment concerned, which has been subject to the provisions of point 3, is

in conformity with the type described in the EU-type examination certificate and

satisfies the requirements of this Directive which apply to it.

2. Manufacturing

The manufacturer shall take all measures necessary so that the manufacturing process

and its monitoring ensure conformity of the manufactured products with the approved

type described in the EU-type examination certificate and with the requirements of this

Directive which apply to them.

538

3. Verification

A notified body chosen by the manufacturer shall carry out the appropriate

examinations and tests in order to check the conformity of the pressure equipment with

the approved type described in the EU-type examination certificate and with the

appropriate requirements of this Directive.

The examinations and tests to check the conformity of the pressure equipment with the

appropriate requirements shall be carried out by examination and testing of every

product as specified in point 4.

4. Verification of conformity by examination and testing of every pressure equipment

4.1. All pressure equipment shall be individually examined and appropriate tests set out in

the relevant harmonised standard(s) or equivalent tests shall be carried out in order to

verify conformity with the approved type and described in the EU-type examination

certificate and with the appropriate requirements of this Directive. In the absence of

such a harmonised standard, the notified body concerned shall decide on the

appropriate tests to be carried out.

539

In particular, the notified body shall:

– verify that the personnel undertaking the permanent joining of parts and the non-

destructive tests are qualified or approved in accordance with points 3.1.2 and

3.1.3 of Annex I;

– verify the certificate issued by the materials manufacturer in accordance with

point 4.3 of Annex I;

– carry out or have carried out the final inspection and proof test referred to in

point 3.2 of Annex I and examine the safety devices, if applicable.

4.2. The notified body shall issue a certificate of conformity in respect of the examinations

and tests carried out, and shall affix its identification number or have it affixed under

its responsibility to each approved pressure equipment.

The manufacturer shall keep the certificates of conformity available for inspection by

the national authorities for 10 years after the pressure equipment has been placed on

the market.

540

5. CE marking and EU declaration of conformity

5.1. The manufacturer shall affix the CE marking and, under the responsibility of the

notified body referred to in point 3, the latter's identification number to each individual

pressure equipment that is in conformity with the approved type described in the

EU-type examination certificate and satisfies the applicable requirements of this

Directive.

5.2. The manufacturer shall draw up a written EU declaration of conformity for each

pressure equipment model and keep it at the disposal of the national authorities, for 10

years after the pressure equipment has been placed on the market. The EU declaration

of conformity shall identify the pressure equipment model for which it has been drawn

up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

If the notified body referred to in point 3 agrees and under its responsibility, the

manufacturer may also affix the notified body's identification number to the pressure

equipment.

541

6. If the notified body agrees and under its responsibility, the manufacturer may affix the

notified body's identification number to the pressure equipment during the

manufacturing process.

7. Authorised representative

The manufacturer's obligations may be fulfilled by his authorised representative, on his

behalf and under his responsibility, provided that they are specified in the mandate. An

authorised representative may not fulfil the manufacturer's obligations set out in point

2.

10. MODULE G: CONFORMITY BASED ON UNIT VERIFICATION

1. Conformity based on unit verification is the conformity assessment procedure whereby

the manufacturer fulfils the obligations laid down in points 2, 3 and 5, and ensures and

declares on his sole responsibility that the pressure equipment concerned, which has

been subject to the provisions of point 4, is in conformity with the requirements of this

Directive that apply to it.

542

2. Technical documentation

The manufacturer shall establish the technical documentation and make it available to

the notified body referred to in point 4.

The documentation shall make it possible to assess the conformity of the pressure

equipment with the relevant requirements and shall include an adequate analysis and

assessment of the risk(s). The technical documentation shall specify the applicable

requirements and cover, as far as relevant for the assessment, the design, manufacture

and operation of the pressure equipment.

The technical documentation shall, wherever applicable, contain at least the following

elements:

– a general description of the pressure equipment;

– conceptual design and manufacturing drawings and diagrams of components,

sub-assemblies, circuits, etc.;

543

– descriptions and explanations necessary for an understanding of those drawings

and diagrams and the operation of the pressure equipment;

– a list of the harmonised standards the references of which have been published in

the Official Journal of the European Union, applied in full or in part, and

descriptions of the solutions adopted to meet the essential safety requirements of

this Directive where those harmonised standards, have not been applied. In the

event of partly applied harmonised standards, the technical documentation shall

specify the parts which have been applied;

– results of design calculations made, examinations carried out, etc.;

– test reports;

– appropriate details relating to the approval of the manufacturing and test

procedures and of the qualifications or approvals of the personnel concerned in

accordance with points 3.1.2 and 3.1.3 of Annex I.

The manufacturer shall keep the technical documentation at the disposal of the relevant

national authorities for 10 years after the pressure equipment has been placed on the

market.

544

3. Manufacturing

The manufacturer shall take all measures necessary so that the manufacturing process

and its monitoring ensure conformity of the manufactured pressure equipment with the

applicable requirements of this Directive.

4. Verification

A notified body chosen by the manufacturer shall carry out appropriate examinations

and tests, set out in the relevant harmonised standard(s) and/or equivalent tests, to

check the conformity of the pressure equipment with the applicable requirements of

this Directive, or have them carried out. In the absence of such a harmonised standard

the notified body concerned shall decide on the appropriate tests to be carried out

applying other technical specifications.

In particular the notified body shall:

– examine the technical documentation with respect to the design and the

manufacturing procedures;

545

– assess the materials used where these are not in conformity with the relevant

harmonised standards or with a European approval for pressure equipment

materials, and check the certificate issued by the material manufacturer in

accordance with point 4.3 of Annex I;

– approve the procedures for the permanent joining of parts or check that they have

been previously approved in accordance with point 3.1.2 of Annex I;

– verify the qualifications or approvals required under points 3.1.2 and 3.1.3 of

Annex I;

– carry out the final inspection referred to in point 3.2.1 of Annex I, perform or

have performed the proof test referred to in point 3.2.2 of Annex I, and examine

the safety devices, if applicable.

The notified body shall issue a certificate of conformity in respect of the examinations

and tests carried out and shall affix its identification number to the approved pressure

equipment, or have it affixed under its responsibility. The manufacturer shall keep the

certificates of conformity at the disposal of the national authorities for 10 years after

the pressure equipment has been placed on the market.

546

5. CE marking and EU declaration of conformity

5.1. The manufacturer shall affix the CE marking and, under the responsibility of the

notified body referred to in point 4, the latter's identification number to each pressure

equipment that satisfies the applicable requirements of this Directive.

5.2. The manufacturer shall draw up a written EU declaration of conformity and keep it at

the disposal of the national authorities for 10 years after the pressure equipment has

been placed on the market. The EU declaration of conformity shall identify the

pressure equipment for which it has been drawn up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

6. Authorised representative

The manufacturer's obligations set out in points 2 and 5 may be fulfilled by his

authorised representative, on his behalf and under his responsibility, provided that they

are specified in the mandate.

547

11. MODULE H: CONFORMITY BASED ON FULL QUALITY ASSURANCE

1. Conformity based on full quality assurance is the conformity assessment procedure

whereby the manufacturer fulfils the obligations laid down in points 2 and 5, and

ensures and declares on his sole responsibility that the pressure equipment concerned

satisfies the requirements of this Directive that apply to it.

2. Manufacturing

The manufacturer shall operate an approved quality system for design, manufacture,

final product inspection and testing of the pressure equipment as specified in point 3

and shall be subject to surveillance as specified in point 4.

3. Quality system

3.1. The manufacturer shall lodge an application for assessment of his quality system with

the notified body of his choice, for the pressure equipment concerned.

The application shall include:

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

548

– the technical documentation for one model of each type of pressure equipment

intended to be manufactured. The technical documentation shall, wherever

applicable, contain at least the following elements:

– a general description of the pressure equipment;

– conceptual design and manufacturing drawings and diagrams of

components, sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for the understanding of those

drawings and diagrams and the operation of the pressure equipment;

– a list of the harmonised standards the references of which have been

published in the Official Journal of the European Union, applied in full or

in part, and descriptions of the solutions adopted to meet the essential

safety requirements of this Directive where those harmonised standards

have not been applied. In the event of partly applied harmonised standards,

the technical documentation shall specify the parts which have been

applied;

549

– results of design calculations made, examinations carried out, etc.;

– test reports;

– the documentation concerning the quality system, and

– a written declaration that the same application has not been lodged with any

other notified body.

3.2. The quality system shall ensure compliance of the pressure equipment with the

requirements of this Directive that apply to it.

All the elements, requirements and provisions adopted by the manufacturer shall be

documented in a systematic and orderly manner in the form of written policies,

procedures and instructions. That quality system documentation shall permit a

consistent interpretation of the quality programmes, plans, manuals and records.

It shall, in particular, contain an adequate description of:

– the quality objectives and the organisational structure, responsibilities and

powers of the management with regard to design and product quality;

550

– the technical design specifications, including standards, that will be applied and,

where the relevant harmonised standards will not be applied in full, the means

that will be used to ensure that the essential requirements of this Directive that

apply to the pressure equipment will be met;

– the design control and design verification techniques, processes and systematic

actions that will be used when designing the pressure equipment, pertaining to

the product type covered, particularly with regard to materials in accordance

with point 4 of Annex I;

– the corresponding manufacturing, quality control and quality assurance

techniques, processes and systematic actions that will be used, particularly the

procedures for the permanent joining of parts as approved in accordance with

point 3.1.2 of Annex I;

– the examinations and tests to be carried out before, during, and after

manufacture, and the frequency with which they will be carried out;

551

– the quality records, such as inspection reports and test data, calibration data,

reports concerning the qualifications or approvals of the personnel concerned,

particularly those of the personnel undertaking the permanent joining of parts

and the non-destructive tests in accordance with points 3.1.2 and 3.1.3 of Annex

I, etc.;

– the means of monitoring the achievement of the required design and pressure

equipment quality and the effective operation of the quality system.

3.3. The notified body shall assess the quality system to determine whether it satisfies the

requirements referred to in point 3.2. It shall presume conformity with those

requirements in respect of the elements of the quality system that comply with the

corresponding specifications of ▌ the relevant harmonised standard ▌.

In addition to experience in quality management systems, the auditing team shall have

at least one member experienced as assessor in the pressure equipment technology

concerned, and knowledge of the applicable requirements of this Directive. The audit

shall include an assessment visit to the manufacturer's premises.

552

The auditing team shall review the technical documentation referred to in point 3.1,

second indent, to verify the manufacturer's ability to identify the applicable

requirements of this Directive and to carry out the necessary examinations with a view

to ensuring compliance of the pressure equipment with those requirements.

The manufacturer or his authorised representative shall be notified of the decision. The

notification shall contain the conclusions of the audit and the reasoned assessment

decision.

3.4. The manufacturer shall undertake to fulfil the obligations arising out of the quality

system as approved and to maintain it so that it remains adequate and efficient.

3.5. The manufacturer shall keep the notified body that has approved the quality system

informed of any intended change to the quality system.

The notified body shall evaluate any proposed changes and decide whether the

modified quality system will continue to satisfy the requirements referred to in point

3.2 or whether a reassessment is necessary.

It shall notify the manufacturer of its decision. The notification shall contain the

conclusions of the examination and the reasoned assessment decision.

553

4. Surveillance under the responsibility of the notified body

4.1. The purpose of surveillance is to make sure that the manufacturer duly fulfils the

obligations arising out of the approved quality system.

4.2. The manufacturer shall, for assessment purposes, allow the notified body access to the

design, manufacture, inspection, testing and storage sites and shall provide it with all

necessary information, in particular:

– the quality system documentation;

– the quality records provided for by the design part of the quality system, such as

results of analyses, calculations, tests, etc.;

– the quality records provided for by the manufacturing part of the quality system,

such as inspection reports and test data, calibration data, qualification reports on

the personnel concerned, etc.

554

4.3. The notified body shall carry out periodic audits to make sure that the manufacturer

maintains and applies the quality system and shall provide the manufacturer with an

audit report. The frequency of periodic audits shall be such that a full reassessment is

carried out every three years.

4.4. In addition, the notified body may pay unexpected visits to the manufacturer.

The need for such additional visits, and the frequency thereof, will be determined on

the basis of a visit control system operated by the notified body. In particular, the

following factors shall be considered in the visit control system:

– the category of the equipment;

– the results of previous surveillance visits;

– the need to follow up corrective action(s);

– special conditions linked to the approval of the system, where applicable;

– significant changes in manufacturing organisation, policy or techniques.

555

During such visits, the notified body may, if necessary, carry out product tests, or have

them carried out, in order to check the proper functioning of the quality system. It shall

provide the manufacturer with a visit report and, if tests have been carried out, with a

test report.

5. CE marking and EU declaration of conformity

5.1. The manufacturer shall affix the CE marking and, under the responsibility of the

notified body referred to in point 3.1, the latter's identification number to each

individual pressure equipment that satisfies the applicable requirements of this

Directive.

5.2. The manufacturer shall draw up a written EU declaration of conformity for each

pressure equipment model and keep it at the disposal of the national authorities for 10

years after the pressure equipment has been placed on the market. The EU declaration

of conformity shall identify the pressure equipment model for which it has been drawn

up.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

556

6. The manufacturer shall, for a period ending 10 years after the pressure equipment has

been placed on the market, keep at the disposal of the national authorities:

– the technical documentation referred to in point 3.1;

– the documentation concerning the quality system referred to in point 3.1;

– the change referred to point 3.4, as approved;

– the decisions and reports of the notified body referred to in points 3.3, 3.4, 4.3

and 4.4.

7. Each notified body shall inform its notifying authorities of quality system approvals

issued or withdrawn, and shall, periodically or upon request, make available to its

notifying authorities the list of quality system approvals refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies of quality system approvals

which it has refused, suspended or withdrawn, and, upon request, of quality system

approvals which it has issued.

557

8. Authorised representative

The manufacturer's obligations set out in points 3.1, 3.5, 5 and 6 may be fulfilled by

his authorised representative, on his behalf and under his responsibility, provided that

they are specified in the mandate.

12. MODULE H1: CONFORMITY BASED ON FULL QUALITY ASSURANCE PLUS

DESIGN EXAMINATION

1. Conformity based on full quality assurance plus design examination and special

surveillance of the final assessment is the conformity assessment procedure whereby

the manufacturer fulfils the obligations laid down in points 2 and 6, and ensures and

declares on his sole responsibility that the pressure equipment concerned satisfy the

requirements of the Directive that apply to it.

2. Manufacturing

The manufacturer shall operate an approved quality system for design, manufacture

and final product inspection and testing of the products concerned as specified in point

3 and shall be subject to surveillance as specified in point 5. The adequacy of the

technical design of the pressure equipment shall have been examined in accordance

with point 4.

558

3. Quality system

3.1. The manufacturer shall lodge an application for assessment of his quality system with

the notified body of his choice, for the pressure equipment concerned.

The application shall include:

– the name and address of the manufacturer and, if the application is lodged by the

authorised representative, his name and address as well;

– the technical documentation for one model of each type of pressure equipment

intended to be manufactured. The technical documentation shall, wherever

applicable, contain at least the following elements:

– a general description of the pressure equipment;

– conceptual design and manufacturing drawings and diagrams of

components, sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for the understanding of those

drawings and diagrams and the operation of the pressure equipment;

559

– a list of the harmonised standards the references of which have been

published in the Official Journal of the European Union, applied in full or

in part, and descriptions of the solutions adopted to meet the essential

safety requirements of this Directive where those harmonised standards

have not been applied. In the event of partly applied harmonised standards,

the technical documentation shall specify the parts which have been

applied;

– results of design calculations made, examinations carried out, etc.;

– test reports;

– the documentation concerning the quality system;

– a written declaration that the same application has not been lodged with any

other notified body.

560

3.2. The quality system shall ensure compliance of the pressure equipment with the

requirements of this Directive that apply to it.

All the elements, requirements and provisions adopted by the manufacturer shall be

documented in a systematic and orderly manner in the form of written policies,

procedures and instructions. This quality system documentation shall permit a

consistent interpretation of the quality programmes, plans, manuals and records.

It shall, in particular, contain an adequate description of:

– the quality objectives and the organisational structure, responsibilities and

powers of the management with regard to design and product quality;

– the technical design specifications, including standards, that will be applied and,

where relevant harmonised standards will not be applied in full, the means that

will be used to ensure that the essential safety requirements of the Directive that

apply to the pressure equipment will be met;

561

– the design control and design verification techniques, processes and systematic

actions that will be used when designing the pressure equipment pertaining to the

pressure equipment type covered, particularly with regard to materials in

accordance with point 4 of Annex I;

– the corresponding manufacturing, quality control and quality assurance

techniques, processes and systematic actions that will be used, particularly the

procedures for the permanent joining of parts as approved in accordance with

point 3.1.2 of Annex I;

– the examinations and tests that will be carried out before, during and after

manufacture, and the frequency with which they will be carried out;

– the quality records, such as inspection reports and test data, calibration data,

reports concerning the qualifications or approvals of the personnel concerned,

particularly those of the personnel undertaking the permanent joining of parts

and the non-destructive tests in accordance with points 3.1.2 and 3.1.3 of Annex

I, etc.;

562

– the means of monitoring the achievement of the required design and pressure

equipment quality and the effective operation of the quality system.

3.3. The notified body shall assess the quality system to determine whether it satisfies the

requirements referred to in point 3.2.

It shall presume conformity with those requirements in respect of the elements of the

quality system that comply with the corresponding specifications of ▌ the relevant

harmonised standard ▌. In addition to experience in quality management systems, the

auditing team shall have at least one member experienced as an assessor in the relevant

pressure equipment field and pressure equipment technology concerned, and

knowledge of the applicable requirements of this Directive. The audit shall include an

assessment visit to the manufacturer's premises.

The auditing team shall review the technical documentation referred to in point 3.1,

second indent, to verify the manufacturer's ability to identify the applicable

requirements of this Directive and to carry out the necessary examinations with a view

to ensuring compliance of the pressure equipment with those requirements.

563

The manufacturer or his authorised representative shall be notified of the decision.

The notification shall contain the conclusions of the audit and the reasoned assessment

decision.

3.4. The manufacturer shall undertake to fulfil the obligations arising out of the quality

system as approved and to maintain it so that it remains adequate and efficient.

3.5. The manufacturer shall keep the notified body that has approved the quality system

informed of any intended change to the quality system.

The notified body shall evaluate any proposed changes and decide whether the

modified quality system will continue to satisfy the requirements referred to in point

3.2 or whether a re-assessment is necessary.

It shall notify the manufacturer of its decision. The notification shall contain the

conclusions of the examination and the reasoned assessment decision.

564

3.6. Each notified body shall inform its notifying authorities of quality system approvals

issued or withdrawn, and shall, periodically or upon request, make available to its

notifying authorities the list of quality system approvals refused, suspended or

otherwise restricted.

Each notified body shall inform the other notified bodies of quality system approvals

which it has refused, suspended or withdrawn, and, upon request, of quality system

approvals which it has issued.

4. Design examination

4.1. The manufacturer shall lodge an application for examination of the design of each item

of pressure equipment not covered by a previous design examination with the notified

body referred to in point 3.1.

4.2. The application shall make it possible to understand the design, manufacture and

operation of the pressure equipment, and to assess the conformity with the

requirements of this Directive that apply to it. It shall include:

– the name and address of the manufacturer;

565

– a written declaration that the same application has not been lodged with any

other notified body;

– the technical documentation. The documentation shall make it possible to assess

the conformity of the pressure equipment with the relevant requirements, and

shall include an adequate analysis and assessment of the risk(s). The technical

documentation shall specify the applicable requirements and cover, as far as

relevant for the assessment, the design and operation of the pressure equipment.

The technical documentation shall, wherever applicable, contain at least the

following elements:

– a general description of the pressure equipment;

– conceptual design and manufacturing drawings and diagrams of

components, sub-assemblies, circuits, etc.;

– descriptions and explanations necessary for the understanding of those

drawings and diagrams and the operation of the pressure equipment;

566

– a list of the harmonised standards the references of which have been

published in the Official Journal of the European Union, applied in full or

in part, and descriptions of the solutions adopted to meet the essential

safety requirements of this Directive, where those harmonised standards

have not been applied. In the event of partly applied harmonised standards,

the technical documentation shall specify the parts which have been

applied;

– results of design calculations made, examinations carried out, etc., and

– test reports;

– the supporting evidence for the adequacy of the technical design. This supporting

evidence shall mention any documents that have been used, in particular where

the relevant harmonised standards have not been applied in full, and shall

include, where necessary, the results of tests carried out by the appropriate

laboratory of the manufacturer or by another testing laboratory on his behalf and

under his responsibility.

567

4.3. The notified body shall examine the application, and where the design meets the

requirements of this Directive that apply to the pressure equipment it shall issue an EU

design examination certificate to the manufacturer. The certificate shall give the name

and address of the manufacturer, the conclusions of the examination, the conditions (if

any) for its validity and the data necessary for identification of the approved design.

The certificate may have one or more annexes attached.

The certificate and its annexes shall contain all relevant information to allow the

conformity of manufactured products with the examined design to be evaluated, and to

allow for in-service control, where applicable.

Where the design does not satisfy the applicable requirements of this Directive, the

notified body shall refuse to issue a design examination certificate and shall inform the

applicant accordingly, giving detailed reasons for its refusal.

568

4.4. The notified body shall keep itself apprised of any changes in the generally

acknowledged state of the art which indicate that the approved design may no longer

comply with the applicable requirements of this Directive, and shall determine whether

such changes require further investigation. If so, the notified body shall inform the

manufacturer accordingly.

The manufacturer shall keep the notified body that has issued the EU design

examination certificate informed of any modification to the approved design that may

affect the conformity with the essential safety requirements of this Directive or the

conditions for validity of the certificate. Such modifications shall require additional

approval - from the notified body that issued the EU design examination certificate - in

the form of an addition to the original EU design examination certificate.

569

4.5. Each notified body shall inform its notifying authorities of the EU design examination

certificates and/or any additions thereto which it has issued or withdrawn, and shall,

periodically or upon request, make available to its notifying authorities the list of

certificates and/or any additions thereto refused, suspended or otherwise restricted.

Each notified body shall inform the other notified bodies of the EU design examination

certificates and/or any additions thereto which it has refused, withdrawn, suspended or

otherwise restricted, and, upon request, of the certificates and/or additions thereto

which it has issued.

The Commission, the Member States and the other notified bodies may, on request,

obtain a copy of the EU design examination certificates and/or additions thereto. On

request, the Commission and the Member States may obtain a copy of the technical

documentation and of the results of the examinations carried out by the notified body.

The notified body shall keep a copy of the EU design examination certificate, its

annexes and additions, as well as the technical file including the documentation

submitted by the manufacturer until the expiry of the validity of the certificate.

570

4.6. The manufacturer shall keep a copy of the EU design examination certificate, its

annexes and additions together with the technical documentation at the disposal of the

national authorities for 10 years after the pressure equipment has been placed on the

market.

5. Surveillance under the responsibility of the notified body

5.1. The purpose of surveillance is to make sure that the manufacturer duly fulfils the

obligations arising out of the approved quality system.

5.2. The manufacturer shall, for assessment purposes, allow the notified body access to the

design, manufacture, inspection, testing and storage sites, and shall provide it with all

necessary information, in particular:

– the quality system documentation;

– the quality records as provided for by the design part of the quality system, such

as results of analyses, calculations, tests, etc.;

– the quality records as provided for by the manufacturing part of the quality

system, such as inspection reports and test data, calibration data, qualification

reports on the personnel concerned, etc.

571

5.3. The notified body shall carry out periodic audits to make sure that the manufacturer

maintains and applies the quality system and shall provide the manufacturer with an

audit report. The frequency of periodic audits shall be such that a full reassessment is

carried out every three years.

5.4. In addition, the notified body may pay unexpected visits to the manufacturer.

The need for such additional visits, and the frequency thereof, will be determined on

the basis of a visit control system operated by the notified body. In particular, the

following factors must be considered in the visit control system:

– the category of the equipment;

– the results of previous surveillance visits;

– the need to follow up corrective action(s);

– special conditions linked to the approval of the system, where applicable;

– significant changes in manufacturing organisation, policy or techniques.

572

During such visits, the notified body may, if necessary, carry out product tests, or have

them carried out, in order to check the proper functioning of the quality system. It shall

provide the manufacturer with a visit report and, if tests have been carried out, with a

test report.

5.5 Special surveillance of the final assessment

Final assessment as referred to in section 3.2 of Annex I is subject to increased

surveillance in the form of unexpected visits by the notified body. In the course of such

visits, the notified body shall conduct examinations on the pressure equipment.

It shall provide the manufacturer with a visit report and, if tests have been carried out,

with a test report.

6. CE marking and EU declaration of conformity

6.1. The manufacturer shall affix the CE marking and, under the responsibility of the

notified body referred to in point 3.1, the latter's identification number to each

individual pressure equipment that satisfies the applicable requirements of this

Directive.

573

6.2. The manufacturer shall draw up a written EU declaration of conformity for each

pressure equipment model and keep it at the disposal of the national authorities for 10

years after the pressure equipment has been placed on the market. The EU declaration

of conformity shall identify the pressure equipment model for which it has been drawn

up and shall mention the number of the design examination certificate.

A copy of the EU declaration of conformity shall be made available to the relevant

authorities upon request.

7. The manufacturer shall, for a period ending 10 years after the pressure equipment has

been placed on the market, keep at the disposal of the national authorities:

– the documentation concerning the quality system referred to in point 3.1;

– the change referred to in point 3.5, as approved;

– the decisions and reports of the notified body referred to in points 3.5, 5.3 and

5.4.

8. Authorised representative

The manufacturer's authorised representative may lodge the application referred to in

points 4.1 and 4.2 and fulfil the obligations set out in points 3.1, 3.5, 4.4, 4.6, 6 and 7,

on his behalf and under his responsibility, provided that they are specified in the

mandate.

574

ANNEX IV

EU DECLARATION OF CONFORMITY (No XXXX)1

▌

1. Pressure equipment or assembly (product, type, batch ▌ or serial number):

2. Name and address of the manufacturer and, where applicable, his authorised

representative:

3. This declaration of conformity is issued under the sole responsibility of the

manufacturer.

4. Object of the declaration (identification of pressure equipment or assembly allowing

traceability; it may, where necessary for the identification of the pressure equipment or

assembly, include an image):

– description of the pressure equipment or assembly;

– conformity assessment procedure followed;

– in the case of assemblies, description of the pressure equipment constituting the

assembly, and the conformity assessment procedures followed;

▌

1 It is optional for the manufacturer to assign a number to the declaration of conformity.

575

5. The object of the declaration described above is in conformity with the relevant Union

harmonisation legislation: ▌

6. References to the relevant harmonised standards used or references to the other

technical specifications in relation to which conformity is declared:

7. Where appropriate, the name, address and number of the notified body which

carried out the conformity assessment and the number of the certificate issued, and

a reference to the EU-type examination certificate – production type, EU-type

examination certificate – design type, EU design examination certificate or

certificate of conformity.

8. Additional information:

Signed for and on behalf of:

(place and date of issue):

(name, function) (signature):

(where appropriate, particulars of the signatory authorised to sign the legally binding

declaration for the manufacturer or his authorised representative)

576

ANNEX V

PART A

Repealed Directive with list of the successive amendments thereto

(referred to in Article 50)

Directive 97/23/EC of the European Parliament and of the

Council

(OJ L 181, 9.7.1997, p. 1)

Regulation (EC) No 1882/2003 of the European

Parliament and of the Council

(OJ L 284, 31.10.2003, p. 1)

Only point 13 of Annex I

Regulation (EU) No 1025/2012 of the European

Parliament and of the Council

(OJ L 316, 14.11.2012, p. 12)

Only point (f) of Article 26(1)

577

PART B

Time-limit for transposition into national law and date of application

(referred to in Article 49)

Directive Time-limit for transposition Date of application

97/23/EC 29 May 1999 29 November 19991

1 In accordance with Article 20(3) of Directive 97/23/EC, Member States shall permit the putting into service of pressure equipment and assemblies which comply with the regulations in force in their territory at the date of application of the Directive beyond that date.

578

ANNEX VI

CORRELATION TABLE

579

Directive 97/23/EC This Directive

Article 1(1) Article 1(1)

Article 1(2) Article 2(1) to (14)

Article 1(3) Article 1(2)

___ Article 2(15) to (32)

Article 2 Article 3

Article 3 Article 4

Article 4(1) Article 5(1)

Article 4(2) Article 5(3)

___ Article 6

___ Article 7

___ Article 8

___ Article 9

___ Article 10

___ Article 11

Article 5 ___

Article 6 ___

___ Article 12(1)

Article 7(1) Article 45

Article 7(2) Article 44(1)

Article 7(3) ___

Article 7(4) Article 44(5), second subparagraph

Article 8 ___

Article 9(1) Article 13(1) introductory sentence

Article 9(2) point 1 ____

____ Article 13(1) (a)

Article 9(2) point 2 Article 13(1) (b)

Article 9(3) Article 13(2)

580

Article 10 Article 14

Article 11(1) Article 15(1)

Article 11(2) Article 15(2)

Article 11(3) Article 15(3)

Article 11(4) Article 12(2)

___ Article 15(4)

Article 11(5) Article 15(5)

___ Article 15(6)

Article 12 ___

Article 13 ___

Article 14(1) Article 16(1)

Article 14(2) Article 5(2)

Article 14(3) to (8) Article 16(2) to (7)

Article 14(9) and (10) ___

___ Article 17

___ Article 18

Article 15(1) ___

Article 15(2) Article 19(1)

Article 15(3) Article 19(2)

Article 15(4) and (5) ___

___ Article 19(3) to (6)

___ Article 20

___ Article 21

___ Article 22

___ Article 23

___ Article 24

___ Article 25

581

___ Article 26

___ Article 27

___ Article 28

___ Article 29

___ Article 30

___ Article 31

___ Article 32

___ Article 33

___ Article 34

___ Article 35

___ Article 36

___ Article 37

___ Article 38

Article 16 ___

Article 17 ___

Article 18 ___

___ Article 39

___ Article 40

___ Article 41

___ Article 42

___ Article 43

___ Article 44(2) to (4)

___ Article 44(5), first subparagraph

___ Article 46

___ Article 47

Article 19 ___

Article 20(1) to (2) ___

582

Article 20(3) Article 48(1)

___ Article 48(2) and (3)

___ Article 49

___ Article 50

___ Article 51

Article 21 Article 52

Annex I Annex I

Annex II Annex II

Annex III, introductory wording Annex III, introductory wording

Annex III, Module A Annex III, point 1, Module A

Annex III, Module A1 Annex III, point 2, Module A2

Annex III, Module B Annex III, point 3.1, Module B, EU-type examination – ▌ production type ▌

Annex III, Module B1 Annex III, point 3.2, Module B, EU-type examination – design type

Annex III, Module C1 Annex III, point 4, Module C2

Annex III, Module D Annex III, point 5, Module D

Annex III, Module D1 Annex III, point 6, Module D1

Annex III, Module E Annex III, point 7, Module E

Annex III, Module E1 Annex III, point 8, Module E1

Annex III, Module F Annex III, point 9, Module F

Annex III, Module G Annex III, point 10, Module G

Annex III, Module H Annex III, point 11, Module H

Annex III, Module H1 Annex III, point 12, Module H1

Annex IV ____

Annex V ____

Annex VI ____

Annex VII Annex IV

583

____ Annex V

____ Annex VI

584

ANNEX TO THE LEGISLATIVE RESOLUTION

STATEMENT OF THE EUROPEAN PARLIAMENT

The European Parliament considers that only when and insofar as implementing acts in the

sense of Regulation (EU) No 182/2011 are discussed in meetings of committees, can the latter

be considered as "comitology committees" within the meaning of Annex I to the Framework

Agreement on the relations between the European Parliament and the European Commission.

Meetings of committees thus fall within the scope of point 15 of the Framework Agreement

when and insofar as other issues are discussed.

585

P7_TA-PROV(2014)0391

Judgments in civil and commercial matters ***I

European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EU) No 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (COM(2013)0554 – C7-0239/2013 – 2013/0268(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2013)0554),

– having regard to Articles 294(2) and points (a), (c) and (e) of Article 81(2) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0239/2013),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to the opinion of the European Economic and Social Committee of 26 February 20141,

– having regard to the undertaking given by the Council representative by letter of 5 February 2014 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the report of the Committee on Legal Affairs (A7-0052/2014),

1. Adopts its position at first reading hereinafter set out;

2. Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

1 Not yet published in the Official Journal.

586

P7_TC1-COD(2013)0268

Position of the European Parliament adopted at first reading on 15 April 2014 with a view to the adoption of Regulation (EU) No .../2014 of the European Parliament and of the Council amending Regulation (EU) No 1215/2012 as regards the rules to be applied with respect to the Unified Patent Court and the Benelux Court of Justice

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular ▌

points (a), (c) and (e) of Article 81(2) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee1,

Acting in accordance with the ordinary legislative procedure 2,

1 Opinion of 26 February 2014 [OJ C.. ,.. , p….] [(not yet published in the Official Journal)].

2 Position of the European Parliament of 15 April 2014.

587

Whereas:

(1) On 19 February 2013, the Kingdom of Belgium, the Republic of Bulgaria, the Czech

Republic, the Kingdom of Denmark, the Federal Republic of Germany, the Republic

of Estonia, Ireland, the Hellenic Republic, the French Republic, the Italian

Republic, the Republic of Cyprus, the Republic of Latvia, the Republic of Lithuania,

the Grand-Duchy of Luxembourg, Hungary, the Republic of Malta, the Kingdom of

the Netherlands, the Republic of Austria, the Portuguese Republic, Romania, the

Republic of Slovenia, the Slovak Republic, the Republic of Finland, the Kingdom of

Sweden and the United Kingdom of Great Britain and Northern Ireland signed the

Agreement on a Unified Patent Court1 (the ‘UPC Agreement’). The UPC Agreement

provides for its entry into force not prior to the first day of the fourth month after the

date of entry into force of the amendments to Regulation (EU) No 1215/2012 of the

European Parliament and of the Council2 concerning the relationship of that

Regulation with the UPC Agreement.

1 OJ C 175, 20.6.2013, p. 1.2 Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December

2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (OJ L 351, 20.12.2012, p. 1).

588

(2) On 15 October 2012, the Kingdom of Belgium, the Grand-Duchy of Luxembourg

and the Kingdom of the Netherlands, parties to the Treaty of 31 March 1965

concerning the establishment and statute of a Benelux Court of Justice (the ‘Benelux

Court of Justice Treaty’), signed a Protocol amending that Treaty. That Protocol

made it possible to transfer jurisdiction to the Benelux Court of Justice in specific

matters falling within the scope of Regulation (EU) No 1215/2012.

(3) It is necessary to regulate the relationship of Regulation (EU) No 1215/2012 with the

UPC Agreement and with the Benelux Court of Justice Treaty by way of amendments

to that Regulation.

(4) The Unified Patent Court and the Benelux Court of Justice should be deemed to be ▌

courts within the meaning of ▌Regulation (EU) No 1215/2012 in order to ensure legal

certainty and predictability for defendants who could be sued in those two Courts at a

location situated in a Member State other than the one designated by the rules of

Regulation (EU) No 1215/2012.

(5) The amendments to Regulation (EU) No 1215/2012 provided for in this Regulation

with regard to the Unified Patent Court are intended to establish the international

jurisdiction of that Court and do not affect the internal allocation of proceedings

among the divisions of that Court nor the arrangements laid down in the UPC

Agreement concerning the exercise of jurisdiction, including exclusive jurisdiction,

during the transitional period provided for in that Agreement.

589

(6) As courts common to several Member States, the Unified Patent Court and the

Benelux Court of Justice cannot, unlike a court of one Member State, exercise

jurisdiction on the basis of national law with respect to defendants not domiciled in a

Member State. To allow those two Courts to exercise jurisdiction with respect to such

defendants, the rules of Regulation (EU) No 1215/2012 should therefore, with regard

to matters falling within the jurisdiction of, respectively, the Unified Patent Court and

the Benelux Court of Justice, also apply to defendants domiciled in third States. The

existing rules of jurisdiction of Regulation (EU) No 1215/2012 ensure a close

connection between proceedings to which that Regulation applies and the territory of

the Member States. It is therefore appropriate to extend those rules to proceedings

against all defendants regardless of their domicile. When applying the rules of

jurisdiction of Regulation (EU) No 1215/2012, the Unified Patent Court and the

Benelux Court of Justice (he re ina ft er ind iv idu al ly ref er red to a s a ‘common court’) should apply only those rules which are

appropriate for the subject-matter for which jurisdiction has been conferred on

them.

590

(7) A common court should be able to hear disputes involving defendants from third

States on the basis of a subsidiary rule of jurisdiction in proceedings relating to an

infringement of a European patent giving rise to damage both inside and outside the

Union. Such subsidiary jurisdiction should be exercised where property belonging to

the defendant is located in any Member State party to the instrument establishing

the common court and the dispute in question has a sufficient connection with any

such Member State, for example because the claimant is domiciled there or the

evidence relating to the dispute is available there. In establishing its jurisdiction, the

common court should have regard to the value of the property in question, which

should not be insignificant and which should be such as to make it possible to

enforce the judgment, at least in part, in the Member States parties to the instrument

establishing the common court.

(8) The rules of ▌Regulation (EU) No 1215/2012 on lis pendens and related actions,

aimed at preventing parallel proceedings and irreconcilable judgments, should apply

when proceedings are brought in a common court and in a court of a Member State in

which the UPC Agreement or, as the case may be, the Benelux Court of JusticeTreaty

does not apply.

591

(9) The rules of ▌Regulation (EU) No 1215/2012 on lis pendens and related actions

should likewise apply where, during the transitional period provided for in the UPC

Agreement ▌, proceedings concerning certain types of disputes ▌are brought in, on

the one hand, the Unified Patent Court ▌and, on the other hand, a national court of a

▌Member State party to the UPC Agreement ▌.

(10) Judgments given by the Unified Patent Court or by the Benelux Court of Justice should

be recognised and enforced in ▌accordance with ▌Regulation (EU) No 1215/2012 in

a Member State not party to, as the case may be, the UPC Agreement or the Benelux

Court of Justice Treaty.

(11) Judgments given by the courts of a Member State not party to, as the case may be, the

UPC Agreement or the Benelux Court of Justice Treaty should be recognised and

enforced in another Member State in accordance with ▌Regulation (EU) No

1215/2012.

▌

(12) Regulation (EU) No 1215/2012 should ▌therefore be amended accordingly ▌.

592

(13) Since the objective of this Regulation cannot be sufficiently achieved by the Member

States but can rather, by reason of its scale and effects, be better achieved at Union

level, the Union may adopt measures, in accordance with the principle of

subsidiarity as set out in Article 5 of the Treaty on European Union (TEU). In

accordance with the principle of proportionality, as set out in that Article, this

Regulation does not go beyond what is necessary in order to achieve that objective.

(14) In accordance with Article 3 and Article 4a(1) of the Protocol (No 21) on the

position of the United Kingdom and Ireland in respect of the area of freedom,

security and justice, annexed to the TEU and to the Treaty on the Functioning of the

European Union (TFEU), those Member States have notified their wish to take part

in the adoption and application of this Regulation.

(15) In accordance with Articles 1 and 2 of the Protocol (No 22) on the position of

Denmark, annexed to the TEU and to the TFEU, Denmark is not taking part in the

adoption of this Regulation and is not bound by it or subject to its application,

without prejudice to the possibility for Denmark of applying the amendments to

Regulation (EU) No 1215/2012 laid down in this Regulation pursuant to Article 3 of

the Agreement of 19 October 2005 between the European Community and the

Kingdom of Denmark on jurisdiction and the recognition and enforcement of

judgments in civil and commercial matters1,

HAVE ADOPTED THIS REGULATION:

1 OJ L 299, 16.11.2005, p. 62.

593

Article 1

▌In Chapter VII of Regulation (EU) No 1215/2012, the following Articles ▌are inserted:

‘Article 71a

1. For the purposes of this Regulation, a court common to several Member States

as specified in paragraph 2 (a "common court") shall be deemed to be a court of

a Member State when, pursuant to the instrument establishing it, such a

common court exercises jurisdiction in ▌ matters falling within the scope of this

Regulation.

2. For the purposes of this Regulation, each of the following courts shall be a common court ▌:

(a) the Unified Patent Court established by the Agreement on a Unified Patent

Court signed on 19 February 2013 (the "UPC Agreement"); and

(b) the Benelux Court of Justice established by the Treaty of 31 March 1965

concerning the establishment and statute of a Benelux Court of Justice (the

"Benelux Court of Justice Treaty").

594

Article 71b

The jurisdiction of a common court shall be determined as follows:

(1) a common court shall have jurisdiction where, under this Regulation, the courts

of a Member State party to the instrument establishing the common court would

have jurisdiction in a matter governed by that instrument;

(2) where the defendant is not domiciled in a Member State, and this Regulation

does not otherwise confer jurisdiction over him, ▌Chapter II shall apply as

appropriate regardless of the defendant's domicile.

Application may be made to a common court for provisional, including

protective, measures even if the courts of a third State have jurisdiction as to the

substance of the matter;

(3) where a common court has jurisdiction over a defendant under point 2 in a

dispute relating to an infringement of a European patent giving rise to damage

within the Union, that court may also exercise jurisdiction in relation to

damage arising outside the Union from such an infringement.

595

Such jurisdiction may only be established if property belonging to the defendant

is located in any Member State party to the instrument establishing the common

court ▌and the dispute has a sufficient connection with any such Member State

▌.

Article 71c

1. Articles 29 to 32 shall apply where proceedings are brought in a common court

and in a court of a Member State not party to the instrument establishing the

common court.

2. Articles 29 to 32 shall apply where, during the transitional period referred to in

Article 83 ▌of the UPC Agreement, proceedings are brought in the Unified

Patent Court and in a court of a Member State party to the UPC Agreement.

596

Article 71d

This Regulation ▌ shall apply to the recognition and enforcement of:

(a) judgments given by a common court which are to be recognised and enforced in

a Member State not party to the instrument establishing the common court;

and

(b) judgments given by the courts of a Member State not party to the instrument

establishing the common court which are to be recognised and enforced in a

Member State party to that instrument.

However, where recognition and enforcement of a judgment given by a common

court is sought in a Member State party to the instrument establishing the common

court, any rules of that instrument on recognition and enforcement shall apply

instead of the rules of this Regulation.’.

597

Article 2

This Regulation shall enter into force on the ▌ day following that of its publication in the

Official Journal of the European Union.

It shall apply from 10 January 2015.

This Regulation shall be binding in its entirety and directly applicable in the Member States in

accordance with the Treaties.

Done at …,

For the European Parliament For the Council

The President The President

598

P7_TA-PROV(2014)0392

Labour force sample survey ***I

European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council amending Council Regulation (EC) No 577/98 on the organisation of a labour force sample survey in the Community (COM(2013)0155 – C7-0086/2013 – 2013/0084(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2013)0155),

– having regard to Article 294(2) and Article 338(1) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0086/2013),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to the undertaking given by the Council representative by letter of 7 March 2014 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the report of the Committee on Employment and Social Affairs and to the opinion of the Committee on Budgets (A7-0344/2013),

1. Adopts its position at first reading hereinafter set out;

2. Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

599

P7_TC1-COD(2013)0084

Position of the European Parliament adopted at first reading on 15 April 2014 with a view to the adoption of Regulation (EU) No .../2014 of the European Parliament and of the Council amending Council Regulation (EC) No 577/98 on the organisation of a labour force sample survey in the Community

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular

Article 338(1) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Acting in accordance with the ordinary legislative procedure1,

1 Position of the European Parliament of 15 April 2014.

600

Whereas:

(1) In order to effectively combat discrimination in accordance with Article 10 of the

Treaty on the Functioning of the European Union (TFEU), to assist in ensuring

compliance with Article 21 of the Charter of Fundamental Rights of the European

Union, and to pursue the aim of full employment and social progress, in accordance

with Article 3 of the Treaty on European Union (TEU), as well as in order to monitor

progress towards Union policy objectives, such as the Europe 2020 headline targets, it

is necessary to have comparable, reliable and objective statistics on the situation of

employed persons, unemployed persons and persons outside the labour market, while

respecting statistical confidentiality, privacy and protection of personal data.

(2) As a consequence of the entry into force of the TFEU, the powers conferred upon the

Commission need to be aligned with Article 290 thereof and with the new legal

framework resulting from the entry into force of Regulation (EU) No 182/2011 of the

European Parliament and of the Council1.

1 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13.).

601

(3) The Commission has committed itself, under Regulation (EU) No 182/2011 ▌, to

reviewing legislative acts which currently contain references to the regulatory procedure

with scrutiny in the light of the criteria laid down in the TFEU.

▌

(4) Council Regulation (EC) No 577/981 contains references to the regulatory procedure with

scrutiny and should therefore be reviewed in the light of the criteria laid down in the

TFEU.

1 Council Regulation (EC) No 577/98 of 9 March 1998 on the organisation of a labour force sample survey in the Community (OJ L 77, 14.3.1998, p. 3.).

602

(5) In order in particular to take account of economic, social and technical developments,

the power to adopt acts in accordance with Article 290 TFEU should be delegated to the

Commission in respect of the adjustment of the list of survey variables, specified within

the list of 14 groups of survey characteristics referred to in Regulation (EC) No577/98,

to establish a three-year programme of ad hoc modules, specifying, for each ad hoc

module the subject, the list and description of the area of specialised information ("ad

hoc sub-modules") and the reference period. In addition, the Commission should be

empowered to adopt delegated acts in order to adopt the list of structural variables ▌ and

the survey frequency. The Commission should ensure that these delegated acts do not

impose a significant additional burden on the Member States or on the respondents.

(6) It is of particular importance that the Commission carry out appropriate consultations

during its preparatory work, including at expert level. The Commission, when preparing

and drawing up delegated acts, should ensure a simultaneous, timely and appropriate

transmission of relevant documents to the European Parliament and to the Council.

603

(7) In order to ensure uniform conditions for the implementation of Regulation (EC) No

577/98, implementing powers should be conferred on the Commission. Those powers

should be exercised in accordance with Regulation (EU) No 182/2011.

(8) In view of the importance of the Labour Force Survey ad hoc modules for Union policies,

a contribution by the Union to the financing of their implementation is to be awarded in

accordance with the principle of reasonable financial-burden-sharing between the

budgets of the Union and the Member States. Grants should be provided, without calls

for proposals, in accordance with Regulation (EU, Euratom) No 966/2012 of the

European Parliament and of the Council1. The grants should be awarded, subject to the

actual implementation of the ad hoc modules, to the national statistical institutes and

other national authorities referred to in Regulation (EC) No 223/2009 of the European

Parliament and of the Council2. Grants that are provided for the purpose of carrying out

labour force surveys may take the form of lump sums. In this context, the use of lump

sums should be one of the principal means of simplifying grant management.

1 Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council of 25 October 2012 on the financial rules applicable to the general budget of the Union and repealing Council Regulation (EC, Euratom) No 1605/2002 (OJ L 298, 26.10.2012, p. 1.).

2 Regulation (EC) No 223/2009 of the European Parliament and of the Council of 11 March 2009 on European statistics and repealing Regulation (EC, Euratom) No 1101/2008 of the European Parliament and of the Council on the transmission of data subject to statistical confidentiality to the Statistical Office of the European Communities, Council Regulation (EC) No 322/97 on Community Statistics, and Council Decision 89/382/EEC, Euratom establishing a Committee on the Statistical Programmes of the European Communities (OJ L 87, 31.3.2009, p. 164.).

604

(9) By way of derogation from Regulation (EU, Euratom) No 966/2012, and in view of the

increased ▌ burden related to the additional information to be collected for the Labour

Force Survey ad hoc modules which will contribute to providing the indicators for the

Union policy targets, it is necessary to co-finance the salary costs of the personnel of

national administrations even if the relevant public authority would have carried out the

supported action without a Union grant, as well as to co-finance other relevant eligible

costs.

▌

605

(10) As regards conferral of powers on the Commission, this Regulation is limited to

aligning the existent conferral of powers on the Commission contained in Regulation

(EC) No 577/98 to Article 290 TFEU and to the new legislative framework resulting

from the entry into force of Regulation (EU) No 182/2011, as well as, where

appropriate, to reviewing the scope of those powers. Since it remains the case that the

objectives of Regulation (EC) No 577/98 cannot be sufficiently achieved by the Member

States but can rather be better achieved at Union level, the Union may adopt measures

in accordance with the principle of subsidiarity as set out in Article 5 TEU. In

accordance with the principle of proportionality as set out in that Article, this

Regulation does not go beyond what is necessary in order to achieve those objectives.

(11) In order to ensure legal certainty, it is necessary that procedures for the adoption of

measures which have been initiated but not completed before the entry into force of this

Regulation not be affected by this Regulation.

(12) Regulation (EC) No 577/98 should therefore be amended accordingly,

HAVE ADOPTED THIS REGULATION:

606

Article 1

Regulation (EC) No 577/98 is amended as follows:

(1) Article 4 is amended as follows:

(a) paragraphs 2 and 3 are replaced by the following:

"2. The Commission shall be empowered to adopt delegated acts in

accordance with Article 7c, in respect of the adjustment of the list of

survey variables, specified in the list of 14 groups of survey

characteristics referred to in paragraph1 of this Article, which is made

necessary by the evolution of techniques and concepts. A delegated act

adopted in accordance with this paragraph shall not transform optional

variables into compulsory variables. The compulsory variables to be

covered continuously shall be within the survey characteristics in points

(a) to (j) and points (l), (m) and (n) of paragraph 1 of this Article. Those

variables shall be within the 94 survey characteristics. The respective

delegated act shall be adopted not later than 15 months before the

beginning of the reference period for the survey.

607

The Commission shall be empowered to adopt delegated acts in

accordance with Article 7c, concerning a list of variables (hereinafter

referred to as "structural variables") ▌ from among the survey

characteristics specified in paragraph 1 of this Article which need to be

surveyed only as annual averages, using a sub-sample of independent

observations with reference to 52 weeks, rather than as quarterly averages.

2a. Structural variables shall fulfil the condition that the relative standard

error (without taking design effect into account) of any yearly estimate

representing 1% or more of the working age population does not exceed:

(a) 9% for Member States with a population of between 1 million and

20 million inhabitants; and

(b) 5% for Member States with a population of 20 million or more.

Member States with less than 1 million inhabitants shall be exempted

from the requirements regarding the relative standard error and the

variables shall be collected for the total sample unless the sample meets

the criterion set out in point (a).

608

For Member States using a sub-sample for data collection on structural

variables, if more than one wave is used, the total sub-sample used shall

consist of independent observations.

2b. Consistency between annual sub-sample totals and full-sample annual

averages shall be ensured for employment, unemployment and inactive

population by sex and for the following age groups: 15 to 24, 25 to 34, 35

to 44, 45 to 54, and 55 +.

3. The Commission shall, by means of implementing acts, adopt rules on the

edits to be used, the codification of the variables and the list of principles

for formulation of the questions concerning labour status. Those

implementing acts shall be adopted in accordance with the examination

procedure referred to in Article 8(2).";

(b) paragraph 4 is deleted.

609

(2) The following Articles are inserted:

"Article 7a

Ad hoc modules

▌

1. A further set of characteristics to supplement the information described in

Article 4(1) may be added (hereinafter referred to as "ad hoc module").

2. The sample used to collect information on ad hoc modules shall also provide

information on structural variables.

3. The sample used to collect information on ad hoc modules shall fulfil one of

the following conditions:

(a) collecting the information on ad hoc modules in the 52 reference weeks

and being subject to the same requirements as in Article 4(2a); or

(b) collecting the information on ad hoc modules in the complete sample of

at least one quarter.

610

4. The Commission shall be empowered to adopt delegated acts in accordance

with Article 7c establishing a programme of ad hoc modules covering three

years. This programme shall for each ad hoc module define the subject, the list

and description of the area of specialised information (hereinafter referred to

as "ad hoc sub-modules") forming the framework within which the ad hoc

module technical characteristics referred to in paragraph 5 of this Article are

determined and define the reference period. The programme shall be adopted

not later than 24 months before the beginning of the reference period of the

programme.

5. In order to ensure the uniform application of the programme referred to in

paragraph 4 of this Article, the Commission shall, by means of implementing

acts, specify the ad hoc module technical characteristics under each ad hoc

sub-module in accordance with the area of specialised information referred to

in that paragraph, as well as the filters and the codes to be used for data

transmission and the deadline for transmission of the results which may be

different from the deadline set out in Article 6. Those implementing acts shall

be adopted in accordance with the examination procedure referred to in Article

8(2).

611

6. The detailed list of information to be collected in an ad hoc module shall be

drawn up not later than 12 months before the beginning of the reference period

for that module. The volume of an ad hoc module shall not exceed 11 technical

characteristics.

Article 7b

Financing provision

The Union shall award financial support to the national statistical institutes and other

national authorities referred to in Article 5(2) of Regulation (EC) No 223/2009 of the

European Parliament and of the Council*, for the implementation of the ad hoc

modules as referred to in Article 7a of this Regulation in accordance with point (a) of

Article 16(1) of Regulation (EU) No 1296/2013 of the European Parliament and of the

Council**. In accordance with the second subparagraph of Article 128(1) of

Regulation (EU, Euratom) No 966/2012 of the European Parliament and the

Council***, the Union may award grants, without a call for proposals, to those

national statistical institutes and other national authorities. The grants may take the

form of lump-sum payments and shall be made on condition that Member States

actually participate in the implementation of ad hoc modules.

612

Article 7c

Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the

conditions laid down in this Article.

2. When exercising the powers delegated in accordance with Article 4(2) and

Article 7a, the Commission shall ensure that the delegated acts do not impose a

significant additional ▌burden on the Member States and on the respondents.

Those delegated acts shall be adopted only where they are necessary in order to

take account of social and economic developments. Those delegated acts do

not change the optional nature of the required information.

613

The Commission shall duly justify the statistical actions provided for in those

delegated acts, using, where appropriate, input from relevant experts based on

a cost-effectiveness analysis, including an assessment of the burden on the

respondents and of the production costs, as referred to in point (c) of Article

14(3) of Regulation (EC) No 223/2009.

614

3. The power to adopt delegated acts referred to in Article 4(2) and Article 7a shall

be conferred on the Commission for a period of five years from …+ . The

Commission shall draw up a report in respect of the delegation of power not

later than nine months before the end of the five-year period. The delegation

of power shall be tacitly extended for periods of an identical duration, unless

the European Parliament or the Council opposes such extension not later than

three months before the end of each period.

4. The delegation of power referred to in Article 4(2) and Article 7a may be

revoked at any time by the European Parliament or by the Council. A revocation

decision shall put an end to the delegation of the power specified in that decision.

It shall take effect on the day following the publication of the decision in the

Official Journal of the European Union or at a later date specified therein. It

shall not affect the validity of any delegated acts already in force.

+ OJ: please insert the date of entry into force of Regulation in doc PE-CONS 63/2014.

615

5. As soon as it adopts a delegated act, the Commission shall notify it

simultaneously to the European Parliament and to the Council.

6. A delegated act adopted pursuant to Article 4(2) and Article 7a shall enter into

force only if no objection has been expressed either by the European Parliament

or by the Council within a period of two months of notification of that act to the

European Parliament and the Council or if, before the expiry of that period, the

European Parliament and the Council have both informed the Commission that

they will not object. That period shall be extended by two months at the initiative

of the European Parliament or the Council.

______________________________

* Regulation (EC) No 223/2009 of the European Parliament and of the Council of

11 March 2009 on European statistics and repealing Regulation (EC, Euratom)

No 1101/2008 of the European Parliament and of the Council on the

transmission of data subject to statistical confidentiality to the Statistical Office

of the European Communities, Council Regulation (EC) No 322/97 on

Community Statistics, and Council Decision 89/382/EEC, Euratom establishing

a Committee on the Statistical Programmes of the European Communities (OJ L

87, 31.3.2009, p. 164.).

** Regulation (EU) No 1296/2013 of the European Parliament and of the Council

of 11 December 2013 on a European Union Programme for Employment and

Social Innovation ("EaSI") and amending Decision No 283/2010/EU establishing

a European Progress Microfinance Facility for employment and social inclusion

(OJ L 347, 20.12.2013, p. 238.).

*** Regulation (EU, Euratom) No 966/2012 of the European Parliament and of

the Council of 25 October 2012 on the financial rules applicable to the general

budget of the Union and repealing Council Regulation (EC, Euratom) No

1605/2002 (OJ L 298, 26.10.2012, p. 1.)".

(3) Article 8 is replaced by the following:

616

"Article 8

Committee procedure

1. The Commission shall be assisted by the European Statistical System Committee

established by Regulation (EC) No 223/2009. That committee shall be a

committee within the meaning of Regulation (EU) No 182/2011 of the European

Parliament and of the Council*.

2. Where reference is made to this paragraph, Article 5 of Regulation (EU)

No 182/2011 shall apply.

_____________________________

* Regulation (EU) No 182/2011 of the European Parliament and of the Council of

16 February 2011 laying down the rules and general principles concerning

mechanisms for control by Member States of the Commission’s exercise of

implementing powers (OJ L 55, 28.2.2011, p. 13.).".

617

Article 2

This Regulation shall not affect the procedures for the adoption of measures provided for in

Regulation (EC) No 577/98 which have been initiated but not completed before …+.

Article 3

This Regulation shall enter into force on the twentieth day following that of its publication in

the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at …,

For the European Parliament For the Council

The President The President

+ OJ: please insert the date of the entry into force of this Regulation.

618

P7_TA-PROV(2014)0393

European Maritime Safety Agency and response to pollution ***I

European Parliament legislative resolution of 15 April 2014 on the proposal for a regulation of the European Parliament and of the Council on multiannual funding for the action of the European Maritime Safety Agency in the field of response to pollution caused by ships and to marine pollution caused by oil and gas installations (COM(2013)0174 – C7-0089/2013 – 2013/0092(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2013)0174),

– having regard to Article 294(2) and Article 100(2) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0089/2013),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to the opinion of the European Economic and Social Committee of 10 July 20131,

– after consulting the Committee of the Regions,

– having regard to the undertaking given by the Council representative by letter of 7 March 2014 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the report of the Committee on Transport and Tourism and the opinion of the Committee on Budgets (A7-0300/2013),

1. Adopts its position at first reading hereinafter set out;

2. Emphasises that any decision of the legislative authority in favour of such multiannual funding for the European Maritime Safety Agency shall be without prejudice to the decisions of the budgetary authority in the context of the annual budgetary procedure;

3. Requests the Commission to present a financial statement which fully takes into account the result of the legislative agreement between the European Parliament and the Council to meet the budgetary and staff requirements of European Maritime Safety Agency and possibly of the Commission services;

1 OJ C 327, 12.11.2013, p. 108.

619

4. Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;

5. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

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P7_TC1-COD(2013)0092

Position of the European Parliament adopted at first reading on 15 April 2014 with a view to the adoption of Regulation (EU) No .../2014 of the European Parliament and of the Council on multiannual funding for the action of the European Maritime Safety Agency in the field of response to marine pollution caused by ships and ▌oil and gas installations)

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article

100(2) thereof,

Having regard to the proposal from the European Commission,

TEXT HAS NOT YET UNDERGONE LEGAL-LINGUISTIC FINALISATION.

621

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee1,

After consulting the Committee of the Regions▌,

Acting in accordance with the ordinary legislative procedure2,

Whereas:

(1) Regulation (EC) No 1406/2002 of the European Parliament and of the Council ▌3

established a European Maritime Safety Agency (▌'the Agency') for the purpose of

ensuring a high, uniform and effective level of maritime safety and prevention of

pollution by ships.

(2) Regulation (EC) No 724/2004 of the European Parliament and of the Council ▌4,

which amended Regulation (EC) No 1406/2002, assigned to the Agency tasks in the

fields of prevention and response to pollution caused by ships, following accidents in

European waters, particularly those of the oil tankers 'Erika' and 'Prestige'.

1 OJ C 327, 12.11.2013, p. 108.2 Position of the European Parliament of 15 April 2014.3 Regulation (EC) No 1406/2002 of the European Parliament and of the Council of 27 June

2002 establishing a European Maritime Safety Agency (OJ L 208, 5.8.2002, p. 1).4 Regulation (EC) No 724/2004 of the European Parliament and of the Council of 31 March

2004 amending Regulation (EC) No 1406/2002 establishing a European Maritime Safety Agency (OJ L 129, 29.4.2004, p. 1).

622

(3) Regulation (EU) No 100/2013 of the European Parliament and of the Council ▌1,

amending Regulation (EC) No 1406/2002, assigned to the Agency tasks with regard to

response to marine pollution caused by oil and gas installations and extended the

Agency's services to the countries covered by the enlargement policy and by the

European Neighbourhood Policy.

(4) Regulation (EC) No 2038/2006 of the European Parliament and of the Council ▌2

established a multiannual funding for the action of the European Maritime Safety

Agency in the field of response to pollution caused by ships which expires on 31

December 2013.

(5) Given the potentially devastating ecological impact and huge economic costs of

pollution incidents, as well as the possible socio-economic impact of such incidents

on other sectors, such as tourism and fisheries, the Agency should have sufficient

means to allow it to carry out its assigned tasks in relation to response to marine

pollution by ships and oil and gas installations. Those tasks are important in

preventing further damage of both a monetary and non-monetary nature.

1 Regulation (EU) No 100/2013 of the European Parliament and of the Council of 15 January 2013 amending Regulation (EC) No 1406/2002 establishing a European Maritime Safety Agency (OJ L 39, 9.2.2013, p. 30).

2 Regulation (EC) No 2038/2006 of the European Parliament and of the Council of 18 December 2006 on multiannual funding for the action of the European Maritime Safety Agency in the field of response to pollution caused by ships (OJ L 394, 30.12.2006, p. 1).

623

(6) For the purposes of implementing the tasks of preventing and responding to pollution

by ships, the Administrative Board of the Agency adopted on 22 October 2004 an

Action Plan for Oil Pollution Preparedness and Response, which determines the

Agency's oil pollution response activities and is aimed at optimum use of the financial

resources available to the Agency. On 12 June 2007, the Administrative Board adopted

an Action Plan for Hazardous and Noxious Substances Pollution Preparedness and

Response. In accordance with Article 15 of Regulation (EC) No 1406/2002, both

action plans are updated yearly through the Agency's annual work programme.

(7) Regard should be given to the existing agreements on accidental pollution, which

facilitate mutual assistance and cooperation between Member States in this field, as

well as to the relevant international conventions and agreements for the protection

of European maritime areas from pollution incidents requiring parties to take all

appropriate measures to prepare for and respond to an oil pollution incident.

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(8) The pollution response action of the Agency, as specified in the Action Plans, relates

to activities in the fields of information, cooperation and coordination, including with

regard to marine pollution caused by hazardous and noxious substances. ▌Above

all, this response action relates to the provision of operational assistance to the

affected Member States or third countries sharing a regional sea basin with the

Union by supplying, on request, additional anti-pollution vessels to combat oil

pollution ▌caused by ships as well as marine pollution caused by oil and gas

installations. The Agency should pay particular attention to those areas identified as

most vulnerable without prejudice to any other area in need.

(9) The activities of the Agency in this field should ▌comply with existing cooperation

arrangements providing for mutual assistance in the event of a maritime pollution

incident. The Union has acceded to various regional organisations and is preparing

accession to other regional organisations.

625

(10) The Agency's action should be coordinated with the activities of the bilateral and

regional agreements that the Union has acceded to. In the event of a maritime pollution

incident, the Agency should assist the affected Member State(s) or third countries

sharing a regional sea basin with the Union, under whose authority clean-up

operations are conducted.

(11) The Agency should play an active role in maintaining and developing further the

European Satellite Oil Monitoring Service (CleanSeaNet) for surveillance, the early

detection of pollution and the identification of the responsible ships or oil and gas

installations, for example in the case of discharges of oil from ships and operational

releases and accidental spills from offshore platforms. That service should improve

the availability of data and the effectiveness and timeliness of the response to

pollution.

(12) The additional means to be provided by the Agency to the affected States should be

made available through the Community Civil Protection Mechanism established by

Council Decision 2007/779/EC, Euratom ▌1.

1 Council Decision 2007/779/EC, Euratom of 8 November 2007 establishing a Community Civil Protection Mechanism (OJ L 314, 1.12.2007, p. 9).

626

(13) The information related to public and private pollution response mechanisms and

associated response capabilities in the various regions of the Union should be made

available by Member States through the Common Emergency Communication and

Information System (CECIS) established by Decision 2007/779/EC, Euratom, when

available for that purpose.

(14) In order to make the Agency's operational assistance more efficient in view of the

extension of the Agency's pollution response mandate to third countries sharing a

regional sea basin with the Union, the Agency should make every effort to

encourage those third countries to pool information and cooperate in maintaining

the list of response mechanisms and associated response capabilities.

(15) In order to improve the effectiveness of the Agency's pollution response activities,

Member States should share with the Agency scientific studies they may have carried

out on the effects of chemicals used as dispersants which could be relevant for those

activities.

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(16) In order to ensure thorough implementation of the Agency's Action Plans, the Agency

should be provided with a viable and cost-effective system for financing, in particular,

the provision of operational assistance to the affected States.

(17) Financial security should therefore be provided for the funding of the tasks entrusted to

the Agency in the field of pollution response and associated actions on the basis of a

multiannual commitment. The size of that multiannual commitment should take

account of the expansion of the Agency's remit with regard to pollution response,

but also of the need for the Agency to increase the efficiency in using the funds

allocated to it, in a context of budgetary constraints. The annual amounts of the

Union contribution should be determined by the Budgetary Authority in accordance

with the annual budgetary procedure. It is of particular importance that the

Commission carry out a mid-term evaluation of the Agency's ability to fulfil its

responsibilities in an effective and cost-efficient manner, in the field of response to

marine pollution caused by ships and oil and gas installations.

(18) The amounts to be committed for the funding of pollution response should cover the

period from 1 January 2014 to 31 December 2020, in line with the new multiannual

financial framework. A financial envelope covering the same period should therefore

be provided.

628

(19) The Agency's support to countries covered by the enlargement policy and by the

European Neighbourhood Policy should be financed through existing Union

programmes for these countries and should therefore not be part of this multiannual

financial framework.

(20) In order to optimise the allocation of commitments and take into account any changes

with regard to activities in response to pollution caused by ships, it is necessary to

ensure continuous monitoring of the particular needs for action so as to allow for

adaptation of the annual financial commitments.

(21) In accordance with Regulation (EC) No ▌1406/2002, the Agency should report on the

financial execution of the multiannual framework in its annual report.

(22) It is appropriate to ensure continuity in the funding support provided under the

action of the European Maritime Safety Agency in the field of response to marine

pollution caused by ships and oil and gas installations, and to align the period of

application of this Regulation with that of Council Regulation (EU, Euratom) No

1311/20131. Therefore, this Regulation should apply from 1 January 2014,

HAVE ADOPTED THIS REGULATION:

1 Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014–2020 (OJ L 347, 20.12.2013, p. 884).

629

Article 1

Subject matter

This Regulation lays down the detailed arrangements for the financial contribution of the Union

to the budget of the European Maritime Safety Agency for the implementation of the tasks

assigned to it in the field of responding to marine pollution caused by ships and ▌oil and gas

installations, pursuant to Articles 1 and 2 of Regulation (EC) No 1406/2002.

The activities of the Agency in this field shall not relieve coastal states of their responsibility

to have appropriate pollution response mechanisms in place.

Article 2

Definitions

For the purposes of this Regulation the following definitions shall apply:

(a) 'oil' means petroleum in any form including crude oil, fuel oil, sludge, oil refuse and

refined products as established by the International Convention on Oil Pollution

Preparedness, Response and Cooperation, 1990;

630

(b) 'hazardous and noxious substances' means any substance other than oil which, if

introduced into the marine environment, is likely to create hazards to human health, to

harm living resources and marine life, to damage amenities or to interfere with other

legitimate uses of the sea, as established by the Protocol on Preparedness, Response

and Cooperation to Pollution Incidents by Hazardous and Noxious Substances, 2000,

of the International Maritime Organisation;

(c) ‘oil and gas installation’ means a stationary fixed or mobile facility, or a

combination of facilities permanently interconnected by bridges or other structures,

used for offshore oil or gas operations or in connection with those operations; this

includes mobile offshore drilling units only if they are stationed in offshore waters

for drilling, production or other activities associated with offshore oil or gas

operations, as well as infrastructure and facilities used to transport the oil and gas

onshore and to onshore terminals.

631

Article 3

Scope

The financial contribution of the Union referred to in Article 1 shall be allocated to the Agency

with the aim of financing actions in the field of response to marine pollution caused by ships

and ▌oil and gas installations ▌as ▌mentioned in the detailed plan established in accordance

with Article 10(2)(k) of Regulation (EC) No 1406/2002, in particular those relating to:

(a) operational assistance and supporting ▌with additional means, such as stand-by anti-

pollution ships, satellite images and equipment, pollution response actions upon

request of the affected Member States or third countries sharing a regional sea basin

with the Union in accordance with Articles 2(3)(d) and 2(5) of Regulation No (EC)

1406/2002 in the event of accidental or deliberate marine pollution caused by ships or

▌oil and gas installations;

(b) cooperation and coordination and the provision to the Member States and the

Commission of technical and scientific assistance in the framework of the relevant

activities of the EU Civil Protection Mechanism, the International Maritime

Organization and the relevant regional organisations;

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(c) information, in particular the gathering, analysis and dissemination of best practices,

expertise, techniques and innovations in the field of responding to marine pollution

caused by ships and oil and gas installations.

Article 4

Union funding

Within the limits of the multiannual financial framework, the Agency shall be given the

appropriations necessary to fulfil its responsibilities in the field of response to marine

pollution caused by ships and oil and gas installations in an effective and cost-efficient

manner.

The financial envelope for the implementation of the tasks referred to in Article 3 for the period

from 1 January 2014 to 31 December 2020 shall be EUR 160.500.000 expressed in current

prices.

Annual appropriations shall be determined by the budgetary authority within the limits of the

financial framework. In this connection the necessary funding of operational assistance to the

Member States pursuant to Article 3(a) shall be guaranteed.

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Article 5

Monitoring existing capabilities

In order to define the requirements for, and to improve the efficiency, of the Agency's

provision of operational assistance ▌, for example in the form of anti-pollution vessels

additional to Member States' capacities, the Agency shall maintain a list of the public and,

where available, private pollution response mechanisms and associated response capabilities in

the various regions of the Union.

The Agency shall maintain that list on the basis of information that Member States shall

provide.

In maintaining the list, the Agency shall aim at obtaining information on pollution response

mechanisms and associated response capabilities from third countries sharing a regional sea

basin with the Union.

The Agency's Administrative Board shall take this list and other appropriate information

relevant to the pollution response objectives set out in Article 1 of Regulation (EC) No

1406/2002, such as that contained in risk assessments and scientific studies on the effects of

chemicals used as dispersants, into account before deciding on the Agency's pollution response

activities in the framework of the annual work programmes. In this context, the Agency shall

pay particular attention to those areas identified as most vulnerable without prejudice to any

other area in need.

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Article 6

Protection of Union financial interests

1. The Commission and the Agency shall ensure that, when actions funded under this

Regulation are implemented, the financial interests of the Union are protected by the

application of preventive measures against fraud, corruption and any other illegal

activities, by means of effective checks and the recovery of any amounts unduly paid

and, where irregularities are detected, by effective, proportional and dissuasive

penalties, in accordance with Council Regulations (EC, Euratom) No 2988/951 and

(Euratom, EC) No 2185/962 and Regulation (EU, Euratom) No 883/2013 of the

European Parliament and of the Council3.

1 Council Regulation (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European Communities financial interests (OJ L 312, 23.12.1995, p. 1).

2 Council Regulation (Euratom, EC) No 2185/96 of 11 November 1996 concerning on-the-spot checks and inspections carried out by the Commission in order to protect the European Communities' financial interests against fraud and other irregularities (OJ L 292, 15.11.1996, p. 2).

3 Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999 (OJ L 248, 18.9.2013, p. 1).

635

2. For the Union actions funded under this Regulation, the notion of irregularity referred

to in Article 1(2) of Regulation (EC, Euratom) No 2988/95 shall mean any

infringement of a provision of Union law or any breach of a contractual obligation

resulting from an act or omission by an economic operator, which has, or would have,

the effect of prejudicing the general budget of the European Union or budgets managed

by it, by an unjustified item of expenditure.

3. The Commission and the Agency shall, each within its respective sphere of

competence, ensure that best value for money is achieved in the funding of Union

actions under this Regulation.

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Article 7

Mid-term evaluation

The Commission shall submit to the European Parliament and to the Council, on the basis of

information provided by the Agency, a report on the implementation of this Regulation no later

than 31 December 2017. The report, which shall be established without prejudice to the role of

the Administrative Board of the Agency, shall set out the results of the utilisation of the Union

contribution referred to in Article 4 as regards commitments and expenditure covering the

period between 1 January 2014 and 31 December 2016.

In the report, the Commission shall present an evaluation of the Agency’s ability to fulfil its

responsibilities in an effective and cost-efficient manner. For the period of 2018–2020, based

on the evaluation and considering the need for the Agency to carry out the tasks assigned to

it, the Commission shall, if necessary, propose an appropriate adjustment, to a maximum of

8%, of the multiannual financial envelope allocated to the Agency for the implementation of

the tasks referred to in Article 3. The possible adjustment shall remain within the limits of the

current multiannual financial framework. This is without prejudice to the annual budgetary

procedures or the upcoming review of the multiannual financial framework.

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The report shall contain information on the socio-economic, ecological and financial

implications, if available, of the Agency's response preparedness relating to marine pollution

caused by ships and oil and gas installations.

Furthermore, on the basis of the report, the Commission may, if appropriate, propose

amendments to this Regulation, in particular in order to take account of scientific progress in

the field of combating marine pollution caused by ships and ▌oil and gas installations,

including with regard to pollution caused by hazardous and noxious substances, as well as of

relevant changes to the instruments, establishing regional organisations, whose activities are

covered by the Agency's activities with regard to pollution response and to which the Union

has acceded.

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Article 8

Entry into force and date of application

This Regulation shall enter into force on the ▌day following that of its publication in the

Official Journal of the European Union.

It shall apply from 1 January 2014 to 31 December 2020.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at ...,

For the European Parliament For the Council

The President The President

_______________

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P7_TA-PROV(2014)0394

Hospitable environment for enterprises, businesses and start-ups to create jobs

European Parliament resolution of 15 April 2014 on ‘How can the European Union contribute to creating a hospitable environment for enterprises, businesses and start-ups to create jobs?’ (2013/2176(INI))

The European Parliament,

– having regard to the Treaty on the Functioning of the European Union,

– having regard to the Commission communication of 3 March 2010 entitled ‘Europe 2020: a strategy for smart, sustainable and inclusive growth’ (COM(2010)2020),

– having regard to the Small Business Act (COM(2008)0394),

– having regard to the work of the Commission’s High Level Group of Independent Stakeholders on Administrative Burdens,

– having regard to the Commission report ‘Minimising regulatory burden for SMEs – Adapting EU regulation to the needs of micro-enterprises’ (COM(2011)0803),

– having regard to the Commission communication on EU regulatory fitness (COM(2013)0685),

– having regard to the Commission’s Entrepreneurship 2020 action plan,

– having regard to the Commission communication ‘An action plan to improve access to finance for SMEs’ (COM(2011)0870),

– having regard to its resolution of 5 February 2013 on improving access to finance for SMEs1,

– having regard to the Late Payments Directive (Directive 2000/35/EC of the European Parliament and of the Council),

– having regard to the survey conducted by the Council of European Employers of the Metal, Engineering and Technology-Based Industries (CEEMET) entitled ‘Flexible employment contracts responding to changing market circumstances and meeting employee needs’2,

– having regard to the new programme for Employment and Social Innovation (EaSI) which will, among other things, extend the support given to microcredit providers under the current European Progress Microfinance Facility,

1 Texts adopted, P7_TA(2013)0036.2 http://www.ceemet.org/en/News/News/CEEMET-Survey-Flexible-employment-contracts-

responding-to-changing-market-circumstances-and-meeting-employee-needs.htm

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– having regard to the Eurofound report of January 2013 entitled ‘Born global: The potential of job creation in new international businesses’,

– having regard to the Eurofound report of 2013 entitled ‘Public policy and support for restructuring in SMEs’,

– having regard to the Eurofound report of 2010 entitled ‘Job creation measures’,

– having regard to Rule 48 of its Rules of Procedure,

– having regard to the report of the Committee on Employment and Social Affairs and the opinions of the Committee on Industry, Research and Energy and the Committee on Regional Development (A7-0101/2014),

A. whereas the time it takes to start a business in Europe differs between Member States and varies from 4 to 40 days, which can impact on job creation;

B. whereas various factors including labour market rigidities have been identified in some Member States as having a negative impact on job creation, and the combination of job flexibility and security can provide a more favourable framework;

C. whereas the single market and European human resources potential can play a key role in achieving the Europe 2020 employment targets;

D. whereas SMEs are the backbone of the EU economy and have a huge potential for job creation, being responsible for 85 % of newly created jobs;

E. whereas 20,7 million SMEs account for over 67 % of private-sector employment in the EU, with 30 % deriving from micro-enterprises;

F. whereas the cost per employee of complying with regulatory obligations can be up to ten times higher for SMEs than for large businesses (COM(2011)0803);

G. whereas due to the financial crisis and the credit crunch that arose in consequence SMEs are facing an extremely high cost of credit and the contraction of its availability; whereas, according to the Institute of International Finance, smaller businesses in the peripheral Member States are paying between 4 and 6 percentage points more for bank loans than their counterparts in central Europe, which is putting them at a significant disadvantage and thus hampering the region’s prospects for economic revival and net job creation;

H. whereas corporate bond, equity and securitisation markets in Europe remain relatively underdeveloped compared to other economies, and non-bank financing remains largely inaccessible to SMEs, undermining their potential to grow and create jobs;

I. whereas the effective provision of services is crucial for future growth, innovation and job creation;

J. whereas while we have the best-educated generation of youth in Europe’s history, and Member States have invested huge amounts of money in education and training, our young people are largely cut off from the labour market and their skills remain unused as they compete for temporary and underpaid positions;

641

K. whereas the European Social Fund has played an important role in assisting Member States to provide opportunities and training for unemployed people to re-enter the labour market;

L. whereas the unemployment rate for young Europeans aged between 15 and 24 has reached the unsustainable level of 23 % and is above 50 % in those Member States most severely hit by the crisis; whereas this massive youth unemployment leads to a huge brain drain and significantly undermines our capacity for sustainable growth in the future;

M. whereas the EU is threatened by the prospect of ‘jobless growth’, which will further undermine the social and economic fabric of our societies as well as the long-term prospects of the EU competing on an equal footing within a globalised knowledge-based economy;

Job creation

1. Is concerned at the cost, complexity and time involved in establishing a business in some parts of the European Union, all of which can impact negatively on future job creation; believes that if the EU is to improve its competitiveness and create more jobs, Member States must work to simplify and speed up this process, offer adequate assistance and support arrangements and make it less costly;

2. Notes that young enterprises that quickly and intensively internationalise after start-up show promising contributions to the economy by creating innovation themselves, fostering innovation in other companies, engaging in international supply chains and creating sustainable and good quality jobs; stresses, however, that these companies are confronted with considerable challenges at the start-up phase which have to be met quickly, while at the same time they have low levels of capital, so that low-cost, simple and quick start-up procedures would be beneficial for them;

3. Notes that global trends have created competitive pressures as well as opportunities for businesses; stresses the need for Member States to create the right regulatory and fiscal framework to foster the creation of jobs whilst ensuring a safe working environment;

4. Believes that in order to create a more hospitable environment for job creation, Member States must, with support from the Union where appropriate, put in place the reforms needed to address the following factors: skills, levels of qualification, entrepreneurship, the impact of demographic change, market access, finance, the labour market, rights at work, administrative costs and better regulation;

5. Emphasises the importance of research and innovation for enhancing the competitiveness, productivity, sustainability and job-creation potential of European SMEs, and notes the significant focus that Horizon 2020 and the EIT place on creating and supporting high-growth, innovative SMEs;

6. Highlights the job potential of the green economy, which, according to Commission estimates, could create 5 million jobs by 2020 in the energy efficiency and renewable energy sectors alone, provided that ambitious climate and energy policies are put in place; calls on the Member States to ensure sufficient levels of investment in these sectors, anticipate workers’ future skills, and guarantee the quality of ‘green jobs’;

642

7. Notes the important role of EU free trade agreements in creating and maintaining investment and jobs in EU Member States;

8. Takes the view that the steady development and deepening of the EU internal market is creating many substantial new opportunities for businesses of all sizes, clearly necessitating flexible framework provisions to promote entrepreneurship and self-employment, while the smooth functioning thereof requires a set of minimum regulatory standards, particularly in respect of public health and safety, health and safety in the workplace, food safety and environmental protection;

Skills

9. Believes the EU is faced with serious skills shortages and mismatches in certain regions and sectors, which are hindering economic growth and the achievement of the Europe 2020 strategy; notes that there are over 1,85 million unfilled vacancies in the EU; is concerned that the latest results of the Survey of Adult Skills (PIAAC), conducted by the OECD and supported by the Commission’s DG Education and Culture, show that 20 % of the EU working-age population has low literacy and low numeracy skills and 25 % of adults lack the skills to make effective use of ICTs;

10. Notes the trend towards more skill-intensive jobs, with almost 90 % of jobs expected to be created or become vacant by 2020 requiring medium or high qualifications;

11. Considers that active policies to promote training courses and further training of workers, continuing education, school-business partnerships and apprenticeships could permit better matching of skills to those sought by businesses;

12. Recognises, in view of the skills shortage, the benefits that lifelong learning and free movement of workers in the EU can offer in addressing labour market demand;

13. Stresses that, while excellence, innovation and human resources are what constitute the comparative advantages of the Union, dwindling investment in research, education and training, coupled with the particularly high unemployment rates in individual Member States and in the euro area, are driving many Europeans to seek employment on other labour markets; stresses that the brain drain is a major obstacle to growth, greater Union competitiveness and measures to promote entrepreneurship;

14. Believes that some Member States' education and training systems should be better adapted to and should converge with future businesses’ skills needs; notes with concern that in 2015 the estimated shortage of qualified ICT personnel in the EU will rise to between 384 000 and 700 000 and that the supply of STEM skills (science, technology, engineering and mathematics) will not match the increasing demands of businesses in the coming years, while the declining rate of women participating in those subjects has not been properly addressed; advocates that Member States be encouraged to establish dual education and training systems focusing on STEM subjects and to promote the retraining and further training of workers, particularly those with low or obsolete skills;

15. Underscores the importance of dual education and training systems, focusing particularly on STEM subjects and combining practice-based education in vocational schools with learning in the workplace, since this has proved the most effective means of smoothing the transition from school to labour market;

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16. Welcomes the Commission’s communication ‘Opening up Education’, which aims to ensure that young people are equipped with digital skills;

17. Believes it is indispensable to introduce the teaching of entrepreneurship skills and programmes for learning how the market, the economy and the financial system operate, function and interact into basic education systems; believes that a well-prepared business plan is the first step towards better access to finance and viability; calls on the Commission and the Member States to include financial education and business start-up advice in their education programmes and to regard investment in entrepreneurial learning as a resource; supports, in this connection, the ‘Erasmus for Young Entrepreneurs’ programme, which is designed to promote an entrepreneurial culture and develop the single market and competitiveness;

18. Underlines the need to improve the pace of the school-to-work transition, thus enabling the young to enter the labour market as soon as possible and avoiding the risk of the NEET (‘not in employment, education or training’) phenomenon;

19. Notes that the European Structural and Investment (ESI) Funds provide support for authorities and stakeholders at the local, regional and national levels to foster, inter alia, work-based learning, research, development and innovation and to improve the competitiveness of micro-enterprises (especially one-person businesses) and SMEs, through cooperation with science and research facilities, thereby helping tackle the current economic and social challenges, in particular the high unemployment rate;

20. Stresses that efforts to support growth, innovation and job creation in a sustainable economy should guarantee health and safety standards and ensure a balance between economic, social and environmental requirements, while, inter alia, supporting smart specialisation, respecting the ecosystem and leading to adequately paid, quality jobs in all regions of the EU; underlines, in this connection, the important role to be played by businesses and the education sector through cross-border projects, cooperation between universities and other high-quality educational institutions and the creation of innovative ‘clusters’; calls for local and regional funding programmes for apprenticeship training to be facilitated;

21. Considers that completion of the digital single market will help support and develop SMEs; considers it necessary to ensure that the necessary qualified ICT staff are available and that the European public possesses the digital skills necessary to make use of ICTs;

22. Stresses that, in order to address the skills shortage Europe is currently facing, urgent action is needed to speed up women’s access to scientific and technological training and occupations, particularly in the new information and communications technology sector;

23. Calls for initiatives that will foster partnerships between businesses, research centres and universities and provide the necessary skills to enable Europeans to access ICT-related, energy-related and high-tech manufacturing jobs;

Entrepreneurship

24. Is concerned that the number of EU citizens who want to be self-employed has dropped from 45 % to 37 % in the last three years, almost one half being afraid of going bankrupt and more than 50 % saying it is difficult to obtain sufficient information on how to start a

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business; considers that SME growth is linked to entrepreneurship; stresses that start-ups and self-employment create employment opportunities and help build strong industrial and services sectors, and advocates, therefore, that Member States be encouraged to promote entrepreneurial mindsets and skills at different education levels and to put in place business start-up advice in universities and vocational training colleges; notes with concern that women represent only 30 % of all entrepreneurs in Europe; stresses the need to promote female entrepreneurship by facilitating access to technical, scientific and business support networks and the development of coaching/mentoring programmes for women entrepreneurs;

25. Notes that the ‘risk’ factor regarding self-employment and the adverse effect of the recent economic crisis on borrowing conditions is a deterrent to engaging in such entrepreneurial activities; recommends, accordingly, that consideration be given to adoption of measures by Member States to balance the welfare safety net for the self-employed without detracting from the flexibility of this particular type of activity;

26. Notes with concern that the financial crisis and the subsequent recession have hit many European SMEs hard and that a significant number have ended up in liquidation, rather than with the company getting a fresh start; highlights the importance of a favourable regulatory framework to favour healthy restructuring and therefore job retention; welcomes the Commission’s Entrepreneurship Action Plan supporting Member States’ efforts to make it easier for sound businesses to survive and for honest entrepreneurs to get a second chance, since this will have a positive impact on job creation; urges the Commission to come forward with an overview of actions taken in the different Member States to enhance the climate for entrepreneurship; underlines the responsibility of the Member States to fully use the support offered by the Commission for improving the climate for entrepreneurs; welcomes the Commission’s efforts to inform citizens and businesses about funding opportunities through publications such as ‘Overview of the financial rules’ and ‘Funding opportunities 2007-2013’;

27. Welcomes the Programme for the Competitiveness of Enterprises and SMEs (COSME) and the SME instrument provided for under Horizon 2020; laments the fact, however, that the budget for COSME and for SMEs in Horizon 2020 under the multiannual financial framework is limited;

28. Welcomes, in particular, the specific actions provided for under COSME which are designed to improve framework conditions for enterprises, particularly SMEs, to facilitate access to finance and markets, and to promote entrepreneurship and entrepreneurial culture; stresses that in order to promote the development of entrepreneurship in Europe a predictable and clear regulatory environment is essential; expects measures and actions promoting entrepreneurship at European or national level to cover enterprise models of all types, including cooperatives, craft businesses, liberal professions and social enterprises; welcomes especially the continued support for equity and debt finance provided under Horizon 2020 and COSME;

29. Believes that young entrepreneurs are enablers of innovation and job creation; underlines the need to connect experienced mentors to aspiring young entrepreneurs and facilitate the creation of support structures in innovative start-ups; welcomes schemes such as Erasmus for Young Entrepreneurs that are aimed at helping new entrepreneurs acquire relevant skills for managing a business, and believes that such programmes should be

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further promoted in order to help more entrepreneurs develop and create jobs; calls on the Member States to promote the practical aspects of entrepreneurial education and training in schemes such as school-company projects and training placements; calls on the Commission and the Member States to take this into account in the implementation of the COSME programme; welcomes the strengthening of the European Institute of Innovation and Technology (EIT), with its clear focus on providing entrepreneurial and innovative skills to 10 000 Masters’ students and 10 000 Ph.D. students by 2020;

30. Calls for support for EU mobility programmes for entrepreneurs, such as Erasmus for Young Entrepreneurs, and for entrepreneurship education to be included in national school curricula through the exchange of best practice;

31. Notes the importance of establishing and supporting business incubators, to provide young entrepreneurs with the opportunity to test their ideas and familiarise themselves with business networks and help them contact potential partners, clients and investors; believes that EU funding can play an essential role, and stresses the success of EU-funded projects and university programmes such as the ERDF-financed Birmingham Skills for Enterprise and Employability Network (BSEEN) in the UK which nurture enterprises and entrepreneurial skills by providing mentoring, intensive start-up support and incubator space for new ventures, and are thus key to future job creation;

32. Draws attention to the fact that, faced with the threat of closure, workers in many European companies can take over the ownership of those companies through cooperative societies; calls for consideration to be given to possible new lines of support through the European Globalisation Adjustment Fund and the European Investment Bank for companies involved in key sectors under the Europe 2020 strategy;

33. Is concerned at the growing phenomenon of bogus self-employment in the European Union; calls on the Member States to adopt specific policies to prevent this, such as sufficient employment opportunities or better labour inspection;

34. Calls on the Member States to promote a culture of internationalisation through information, the presentation of good practices and the provision of a platform for information exchange; urges them to provide skills development in the field of entrepreneurship with an international focus, to promote transparency as regards available support tools for start-ups, to support networking and exchanges that link young entrepreneurs with potential investors and business partners, and to provide operational advice and support even after the start-up phase in order to help them get through the critical early years and provide incentives for employment;

35. Emphasises the importance of providing young Europeans with entrepreneurial education and encouraging entrepreneurial attitudes; notes, in this context, the landmark role that the EIT plays in promoting an entrepreneurial culture through education, training and practice; notes that all the EIT’s Knowledge and Innovation Communities actively promote entrepreneurship in their respective fields, through the development of curricula that combine excellent science and innovation with entrepreneurial skills and experiences, thus preparing the entrepreneurs of tomorrow and infusing existing businesses with an innovative and entrepreneurial mindset;

36. States that it is of the utmost importance for the EU’s social cohesion to tackle the high unemployment rates, in particular among young people and other vulnerable groups, in

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the EU by boosting regional competitiveness and employment and fostering an entrepreneurial spirit; calls, therefore, on the Member States to use the ESI Funds to focus on creating sustainable jobs and business opportunities by providing a hospitable environment and the right regulatory framework for micro-, small and medium-sized enterprises, businesses and start-ups;

37. Points out that the ESI Funds have an important role to play in supporting employment and concrete projects aimed at enhancing entrepreneurial, enterprise and creative skills, including those of young people; underlines the need for all Member States and regions to make full use of this opportunity in order to tackle youth unemployment; stresses that, through the ESI Funds, local and regional authorities should pay particular attention to promoting entrepreneurship at local and regional level, including a focus on start-ups by young people;

38. Welcomes the growth in recent years of the social economy as a new form of entrepreneurship in the European Union, particularly for young people; calls on the Member States to develop strategies and programmes promoting the social economy;

Demographics

39. Believes that, given the widespread phenomenon of ageing populations, Member States should be encouraged, inter alia in the context of solidarity between the generations, to promote the retention of older workers, both women and men, on the labour market, by valuing experience; stresses that an older labour force and longer working lives can make a positive contribution to the recovery and to future growth; emphasises, therefore, the importance of lifelong learning, in particular for older workers; stresses, finally, that older people are indispensable with a view to passing on knowledge and experience to younger generations;

40. Believes in the importance of promoting senior entrepreneurship as a means of engaging the senior population with significant business experience in the innovation process, thereby extending working lives and retaining indispensable skills in the labour market;

41. Calls on the Member States to effectively implement the EU legislation outlawing discrimination in the workplace on the grounds of age, disability, sexual orientation or religion or belief;

42. Recognises the importance of taking into account the situation of people who have to reconcile work and family life;

Market access

43. Stresses that the opportunities afforded directly by the EU single market must be used to inject new life into Europe’s economies by opening up borders, removing existing obstacles that hamper workers’ mobility, and creating new business opportunities and jobs;

44. Calls for the remaining barriers to the cross-border provision of services to be dismantled, thus enabling them to create more jobs;

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45. Stresses that for SMEs, size does matter, and that a larger scale allows SMEs to more easily withstand economic cycles, build deeper expertise, find new customers and markets, link into global supply chains, and obtain easier access to bank financing and broaden funding sources, thus creating more jobs; believes that the Commission and the Member States should encourage the provision of education in management and business strategy for SME owners looking to expand their businesses; highlights the importance of aid to SMEs to develop connections to untapped foreign markets by redirecting existing public agencies to work with banks and SMEs’ associations towards that end;

46. Stresses that the introduction of suitable and flexible single market framework provisions to promote entrepreneurship and support the small and medium-sized undertakings that form the economic backbone of the Union must not, under any circumstances, be achieved to the detriment of minimum European labour standards and fundamental labour rights;

47. Notes that it is crucial to ensure support for SMEs aiming to internationalise through medium- and long-term loans or equity investments, and to educate SMEs in how to access trade financing;

48. Notes the importance that the digital economy has for creating jobs, especially when linked to sectors in which Europe is traditionally strong, such as the creative industries, cultural heritage and tourism;

49. Stresses that free and fair competition in the single market, underpinned by common social standards, is of crucial importance for boosting growth and innovation and thereby increasing employment in the Union;

Finance

50. Notes that bank lending is still the most common source of finance in Europe; believes however, that there are real benefits in new forms of financing through innovative schemes and non-bank routes, such as crowdfunding, SME angels, peer-to-peer lending, micro-lending, easily accessible microcredit agencies and other tools, which can provide vital investment for start-ups and SMEs to grow and create jobs; believes that new forms of financing would be beneficial for young, dynamic businesses which have difficulties in accessing more traditional sources of finance due to their ‘newness'; stresses that such new forms of financing should not be limited to start-up and growth phases and that fostering alternative capital markets would also be beneficial for realising positive outcomes for both companies and their employees, for example in cases of restructuring;

51. Considers it extremely important for Member States to implement Directive 2011/7/EU on combating late payment in commercial transactions, under which, with regard to transactions between undertakings and public authorities, the contractual payment period must not exceed the time limits laid down in Article 4(3) unless otherwise expressly agreed in the contract and provided it is objectively justified in the light of the particular nature or features of the contract and in any event does not exceed 60 calendar days;

52. Emphasises that non-innovative and established SMEs looking to expand into new markets or to transfer their ownership often also need public support in order to secure the necessary financing;

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53. Stresses that the cohesion policy for the 2014-2020 period is an important and effective instrument for generating smart, sustainable and inclusive growth and achieving the Europe 2020 targets while supporting, through a wide range of measures and innovative financial instruments, the start-up and development of small and medium-sized enterprises (SMEs), including micro-enterprises, as a key motor of job creation in the EU;

54. Welcomes initiatives to make it easier for citizens, organisations and businesses, in particular SMEs, to access EU support via a single multilingual portal offering information on the Structural Funds, including the ESF Horizon 2020 and COSME; also welcomes the Enterprise Europe Networks endeavours in this field; believes, nonetheless, that more must be done to disseminate clear and comprehensive information about funding opportunities to existing and potential entrepreneurs through ‘one-stop shops’ throughout the regions, and to encourage financial intermediaries to make greater use of the funding sources available;

55. Asks for a better coordination of EU funding mechanisms, including Structural Funds, ERDF, Horizon 2020 and EIB investments, especially when it comes to funding innovative SMEs, and asks for an assessment of current obstacles arising from the fact that in several Member States banks fail to transfer funds and loan guarantees to SMEs and the real economy;

56. Underlines the importance of research and innovation for enhancing the competitiveness, productivity, sustainability and job-creation potential of European SMEs, and notes the significant focus that Horizon 2020 and the EIT place on creating and supporting high-growth innovative SMEs;

57. Welcomes the creation of an SME instrument under the Horizon 2020 programme enabling SMEs to access financial and non-financial support in order to implement innovative ideas; calls on the Commission to introduce this instrument as of 2014 in the most SME-friendly way, i.e. through a single dedicated agency, allowing for the genuine ‘bottom-up’ submission of projects and supporting all types of innovation, including non-technological and social innovation;

58. Points out that firms, however, often face problems in finding money to finance their research, develop new products or access new markets;

59. Supports EU initiatives which help SMEs access more financial resources with greater ease, on the grounds that they make for easier, faster access to funding for young and innovative companies, encourage Member States to adopt mechanisms to foster innovation (e.g. tax credit mechanisms to fund research and innovation) and redress inequalities between Member States; supports initiatives seeking to encourage entrepreneurs whose businesses have failed, so as to offer them a second chance and not discourage risk-taking;

60. Welcomes the simplification of reimbursement methods as part of the Commission’s proposal for a Common Provisions Regulation on the Structural Funds, given the important role that these instruments play in many regions in the promotion of entrepreneurship and skills; asks the Commission to monitor SMEs’ access to Community funding and to report to Parliament on the matter;

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61. Takes the view that public investment and state support for the setting-up and continued operation of undertakings is crucial; believes that Member States should demand safeguards and guarantees from companies setting up in each Member State and receiving public support; with the objective of preserving jobs;

Labour market

62. Strongly believes that businesses could create more jobs if the right conditions exist, including access to a qualified and highly-skilled workforce, work-life balance, reasonable costs and taxes, and keeping administrative and regulatory burdens to a minimum;

63. Notes the importance of workplace flexisecurity, on the one hand in giving workers a fair degree of security and on the other in allowing economic operators to react in a flexible way to changes in the market;

64. Sees the introduction of ‘youth coaches’ in employment agencies as an important step towards further reducing the numbers of young people who fail to make the transition from education to the labour market;

65. Believes Member States must invest more in human capital and be more responsive to labour market needs, notably by ensuring strong links between the world of education and the world of work, ensuring that young people are equipped with the right information, advice and guidance to make sound career choices, and fostering work-based learning apprenticeships, as well as retraining of employees and provision of lifelong learning opportunities;

66. Considers that there is major scope for increasing the involvement of the social partners and the bodies concerned in the formulation of a long-term strategy for small and medium-sized enterprises, this being the only way to identify malfunctions, formulate intelligent and flexible legislation, avoid market fragmentation and promote the creation and development of sustainable and quality employment;

67. Calls on the Commission and the Member States to create viable transition schemes from higher education and vocational training to the labour market, especially for first-time young professionals;

68. Calls on the Member States to continue taking policy measures, accompanied by economic and regulatory incentive mechanisms, which shape culture and educational systems through the creation of partnerships and exchange networks between all the various levels of education and companies, in order to bridge the current gap between academia and the market and make it easier for researchers to move from universities to companies, thereby fostering innovation;

SMEs and micro-enterprises

69. Considers that SMEs are the main drivers of innovation and economic growth in the EU and play a crucial role in providing pathways into work for people of all ages and for both women and men; regrets that in many Member States they are excluded from public research, innovation and development policy;

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70. Highlights the importance of SMEs not only in creating but also in preserving jobs;

71. Points out that more than 20 million SMEs in the EU represent 99 % of businesses, and that SMEs are a key driver of economic growth, innovation, employment and social integration;

72. Believes that public policy measures play an important role in supporting and stimulating the creation and development of SMEs (e.g. affordable loans, advisory services on public initiatives and legislation, incubators and accelerators, clusters, technology transfer offices, coaching and mentoring schemes, etc); considers that networking and the exchange of best practice play an important role in this respect; believes that intangible and non-financial forms of support, such as access to knowledge and information, financial education and business networks, are essential for new entrepreneurs and SMEs to develop their businesses; considers that, in order to stimulate the internal market and trade among small businesses, it is particularly important to ensure the mutual recognition of occupational qualifications and the interoperability of different commercial regulatory systems;

73. Believes that innovation in SMEs is an important route to job creation; points out that if SMEs are to participate successfully in the innovation system, it is essential that they are in the driving seat with regard to their innovative activities and that support is better tailored to their real needs;

74. Underlines the ‘think small first’ principle; recognises the benefits of crossborder e-commerce in providing new opportunities for SMEs to access the single market, create employment opportunities, reduce costs and compete globally;

75. Stresses the opportunities offered by ICTs in terms of enhancing productivity and competitiveness; emphasises the need for the potential of the digital single market to be unleashed, and points out that the cost of creating an innovative ICT start-up has fallen by a factor of 100 in the last ten years, mainly as a result of technologies such as ultra-fast and ubiquitous broadband, cloud computing, open-source software, open data and access to public-sector information;

76. Highlights the fact that eGovernment is particularly beneficial for entrepreneurs (particularly SMEs, who often face insurmountable barriers when operating across borders within the EU), as it brings reduced administrative costs and burdens, increased productivity, efficiency, competitiveness, transparency, openness, policy effectiveness, accessibility and streamlining of procedures;

77. Believes that the lack of adequate protection for SMEs can in many cases cripple businesses and stall economic growth, and may also discourage entrepreneurs from taking chances, which will impact on their ability to grow and create jobs;

78. Notes that the main barriers facing start-ups and affecting the development of high-growth SMEs are difficult access to and cost of finance, burdensome regulation, lack of knowledge of regulations, indirect costs, restricted access to export markets, average payment times and skills shortages;

79. Welcomes the introduction of the ‘SME test’ and the Commission’s commitment to propose lighter regulatory regimes for SMEs and exemptions for micro-businesses on a

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case-by-case basis, without compromising on health, safety and employment standards; believes that mitigating measures must be introduced across a range of legislative proposals, e.g. longer implementation time, efficient and effective inspections, or guidelines to simplify firms’ paperwork, but without creating a two-tier labour market;

80. Welcomes initiatives such as the CREATE project which address the barriers to growth and job creation and competitiveness experienced by SMEs in rural areas;

81. Believes that Member States must be encouraged to share best practice - for example, through the European Network of SME Envoys on innovative ways to create jobs, by reducing bureaucracy and red tape and improving communication, particularly for SMEs and microenterprises;

82. Urges the Commission and the Member States to help local authorities and SMEs’ associations promote local production and product quality, for example through the formation of business clusters for joint research and development projects;

83. Believes that also organisations representing SMEs should be encouraged to share cross- border best practices on innovative ways to reduce bureaucracy and red tape;

84. Regrets that the labour reforms taking place in various Member States are resulting in many workers no longer being protected by collective agreements, especially in SMEs; considers that any improvements in labour flexibility should be accompanied by adequate labour protection;

85. Believes that the framework for SME participation in public procurement should be improved;

86. Notes that in many Member States there is insufficient support and/or an insufficient regulatory framework to ensure appropriate conditions for young and innovative companies and start-ups, and stresses the need for better coordination of the different European, national, regional and local policies and instruments concerning SMEs;

87. Stresses the need to strengthen EU rules on product traceability, so as to combat counterfeiting and create an effective means of encouraging the development of SMEs;

Better regulation

88. Stresses the need for more efficient and more clearly-worded regulations that can be implemented in a simple manner and can help all actors, including entrepreneurs, operate within the rule of law and enable both entrepreneurs and employees to benefit from the opportunities and protection afforded by employment and health and safety legislation;

89. Underlines the need for greater integration of Union policies in favour of SMEs as regards innovation, growth, competitiveness, internationalisation, entrepreneurship, resource productivity, reducing bureaucracy, the quality of human resources, and environmental and social responsibility;

90. Acknowledges the Commission’s actions to address the results of the review of the ‘Top 10’ most burdensome laws for SMEs, which will help businesses create more employment opportunities; believes that the Commission should urgently prioritise the

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improvement of these regulations in ways that address SMEs’ concerns; believes there is a need to ensure that the EU and Member States take account of the specific needs of, and considers support measures for businesses, in particular SMEs and micro-enterprises, in the policy process;

91. Points out that young companies which internationalise rapidly and intensively after their start-up phase make useful contributions to the economy by creating innovation, encouraging other companies to innovate, taking part in international supply chains and creating sustainable high-quality employment; notes, however, that since these companies face considerable challenges during the start-up phase due to low levels of capital, low-cost, simple and quick start-up procedures would be of benefit to them;

92. Stresses that rules on health and safety at work and workers’ protection cannot be considered as burdensome regulations; calls on the Commission to simplify excessive administrative burdens while always ensuring health and safety at work and guaranteeing that SMEs have adequate knowledge and resources enabling them to manage their employees’ working environment properly;

93. Notes the new health and safety strategy; hopes it will focus on prevention, usability, clarification, simplification, prevention, and better implementation of existing legislation in order to ensure workers’ health and safety;

94. Welcomes the reduction of REACH registration fees for SMEs, even though fees represent a fraction of overall compliance costs; is extremely concerned, however, that initial cost estimates from REACH were underestimated, with this difference already amounting to over EUR1 billion – a figure that will continue to rise;

95. Stresses the need to improve overall business efficiency through projects and instruments which make it possible to confront the challenge of energy recovery with a view to encouraging reduced energy costs;

96. Points out that the provisions of the regulations for the 2014-2020 cohesion policy period aim to reduce the administrative burden on micro-enterprises and SMEs, particularly as regards the activation of unemployed people, thereby contributing to better conditions for job creation; calls on the Member States to do away with the obstacles standing in the way of better implementation of the ESI Funds for the benefit of micro-enterprises and SMEs;

Recommendations

97. Calls on the Commission and the Member States to act with speed and ambition to reduce the regulatory burden on SMEs, while ensuring that any proposed solutions are evidence-based and respecting health and safety and Article 9 TFEU;

98. Calls on the Commission and the Member States to fully exploit the job potential of the green economy by developing a Renaissance of Industry for a Sustainable Europe (RISE) strategy that pursues technological, business and social innovation towards a third industrial revolution including a low-carbon modernisation offensive; argues that RISE will create new markets, business models and creative entrepreneurs, new jobs and decent work, bringing an industrial renewal with economic dynamism, confidence and

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competitiveness; believes that energy and resource efficiency are key pillars of such a strategy;

99. Considers that an appropriate approach could be offered by the Commission’s proposal that micro-entities should be excluded from the scope of future proposed legislation unless there is a need for them to be covered;

100. Calls on the Commission to ensure that national SME organisations are part of the newly-established network of SME Envoys and the SME Assembly and are properly informed of EU initiatives and policy proposals; stresses, in this context, the equally important role of the European Information Centres (EICs), which have so far not managed to provide a service that lives up to the expectations and needs of European businesses;

101. Calls on the Member States to promote language learning through lifelong learning (vocational training), for employees of SMEs and micro-entities, as a means of reinforcing access to and participation in the single market for such firms;

102. Asks the Commission to ensure easier access for SMEs to structural funds, notably by relaxing the requirements for pre-financed projects, reducing the requirements for cofinancing, better targeting different types of SMES, closing the financing gap between call cycles, and supporting capacity-building for SME funding;

103. Recommends MEPs to make full use of the Impact Assessment and European Added Value Directorate in order to scrutinise the cost, benefits and other implications of proposed draft legislation on SMEs and job creation in particular;

104. Calls on the Commission and the Member States to be more rigorous in assessing the impact of future and existing regulation on SMEs and competitiveness in general;

105. Reminds Member States of their commitment under the Small Business Act to make it possible to start a business within 48 hours maximum; calls on the Member States, in this context, to make every effort to reach this target in order to achieve the employment targets contained in the Europe 2020 strategy;

106. Calls on the Commission to address any identified negative effects that EU legislation has on businesses and their ability to create jobs, particularly with regard to the aspects of lack of knowledge, overall perception and lack of support for the practical application of EU legislation; calls on the Commission to improve the flow of information to SMEs;

107. Calls on the Commission, in the context of the REFIT programme, to check that all legislation is doing what it was intended to do, and to identify areas where there are inconsistencies or ineffective measures affecting employment opportunities;

108. Highlights the recent trend of companies returning production and services to Europe and the opportunities this brings for job creation; believes that the economies of the EU have a unique opportunity to accelerate this trend of re-shoring jobs and calls on the Member States, together with the Commission, to consider dedicating support, including the possibility of setting up ‘one-stop shops’, to help businesses take advantage of the opportunities offered by re-shoring;

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109. Calls on the Member States and the Commission to support self-employment, possibly across borders and especially among women and young people, by creating an environment and developing an education and social protection system that will encourage entrepreneurs to set up and develop their businesses and create new jobs by, for example, promoting entrepreneurship among students and professionals;

110. Expresses its hope that entrepreneurship will be a more prominent topic in the next years; notes that this will require reflection, particularly with regard to the implementation of the Entrepreneurship 2020 Action Plan; considers that developing entrepreneurial spirit and skills is a sustainable way forward in terms of job creation, more start-ups and business innovation; would like to see the Commission name 2017 the ‘European Year for Entrepreneurship’;

111. Calls on the social partners to embrace smart regulation tools, increase the use of impact assessments in their negotiations, and refer agreements proposing legislative action to the Commission’s Impact Assessment Board;

112. Insists that the Data Protection Regulation should follow a balanced approach, protecting data privacy while stimulating the digital economy, job creation and growth;

113. Calls on the EU to work with Member States, universities, research establishments and businesses in order to coordinate and make full use of EU funding sources (e.g. ESF, ERDF, COSME, Horizon 2020 and Erasmus+), in order to promote an entrepreneurial culture, particularly among women and young people, develop and upgrade the qualifications and skills needed by the labour market, and support the creation of new businesses;

114. Calls on the EU and the Member States to cooperate on introducing entrepreneurship skills into curricula at all stages of education;

115. Calls on the EU to work with Member States, schools and universities on the implementation of open technology-based education;

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116. Instructs its President to forward this resolution to the Council and Commission.

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P7_TA-PROV(2014)0395

New technologies and open educational resources

European Parliament resolution of 15 April 2014 on new technologies and open educational resources (2013/2182(INI))

The European Parliament,

– having regard to Articles 165 and 166 of the Treaty on the Functioning of the European Union,

– having regard to Article 14 of the Charter of Fundamental Rights of the European Union,

– having regard to the Commission Communication of 25 September 2013 entitled ‘Opening up Education: Innovative teaching and learning for all through new Technologies and Open Educational Resources’ (COM(2013)0654) and the accompanying staff working document on analysis and mapping of innovative teaching and learning for all through new Technologies and Open Educational Resources in Europe (SWD(2013)0341),

– having regard to the Commission Communication of 11 July 2013 entitled ‘European higher education in the world’ (COM(2013)0499),

– having regard to the Regulation of the European Parliament and of the Council of 11 December 2013 establishing ‘Erasmus+’: the Union programme for education, training, youth and sport and repealing Decisions No 1719/2006/EC, No 1720/2006/EC and No 1298/2008/EC1,

– having regard to the Council conclusions of 24 February 2014 on efficient and innovative education and training to invest in skills – supporting the 2014 European Semester2,

– having regard to the Council recommendation of 20 December 2012 on the validation of non-formal and informal learning3,

– having regard to the Council conclusions of 14 February 2011 on the role of education and training in the implementation of the Europe 2020 strategy4,

– having regard to the Council conclusions of 11 May 2010 on the social dimension of education and training5,

– having regard to the Council conclusions of 11 May 2010 on the internationalisation of higher education6,

1 OJ L 347, 20.12.2013, p. 50.2 OJ C 62, 4.3.2014, p. 4.3 OJ C 398, 22.12.2012, p. 1.4 OJ C 70, 4.3.2011, p. 1.5 OJ C 135, 26.5.2010, p. 2.6 OJ C 135, 26.5.2010, p. 12.

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– having regard to its resolution of 22 October 2013 on rethinking education7,

– having regard to its resolution of 12 September 2013 on the digital agenda for growth, mobility and employment: time to move up a gear2,

– having regard to its resolution of 11 September 2012 on education, training and Europe 20203,

– having regard to its resolution of 20 April 2012 on modernising Europe’s higher education systems4,

– having regard to its resolution of 26 October 2011 on the agenda for new skills and jobs5,

– having regard to its resolution of 12 May 2011 on Youth on the Move – a framework for improving Europe’s education and training systems6,

– having regard to the opinion of the European Economic and Social Committee of 26 February 20147,

– having regard to the opinion of the Committee of the Regions of 31 January 20148,

– having regard to Rule 48 of its Rules of Procedure,

– having regard to the report of the Committee on Culture and Education (A7-0249/2014),

A. whereas education and training systems need to be geared towards achieving equal opportunities in learning and towards meeting an increasing need for the continuous updating of knowledge and skills and an increasingly international labour market while aiming at greater efficiency and equity;

B. whereas the Europe 2020 strategy aims to boost innovation, create new employment opportunities, improve social cohesion and build solid foundations for sustainable and inclusive growth in the EU through a highly skilled workforce that enjoys equal access to education;

C. whereas high unemployment levels, particularly among young people, including university graduates, coincide with a significant number of vacancies in Europe that cannot be filled, pointing to a marked skills gap that could best be overcome, inter alia, through dual vocational training models; whereas in 2012 15,8 % of young people in the EU were neither in employment nor in education or training (NEET), and thus at risk of being excluded from the labour market due to increased skills mismatches;

7 Texts adopted, P7_TA(2013)0433.2 Texts adopted, P7_TA(2013)0377.3 OJ C 353 E, 3.12.2013, p. 56.4 OJ C 258 E, 7.9.2013, p. 55.5 OJ C 131 E, 8.5.2013, p. 87.6 OJ C 377 E, 7.12.2012, p. 77.7 Not yet published in the Official Journal.8 Not yet published in the Official Journal.

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D. whereas it is expected that by 2020, 90 % of jobs will require digital skills, and whereas by 2015 there will be up to 900 000 unfilled information and communication technologies (ICT)-related vacancies in the EU;

E. whereas the number of university graduates is expected to quadruple by 2030;

F. whereas 18-28 % of students in the EU have few possibilities to access and use the internet either at school or at home; whereas only 30 % of students in the EU can be considered as digitally competent; whereas only 20 % of students in the EU are taught by digitally confident and supportive teachers; whereas 70 % of teachers in the EU do not consider themselves digitally confident and would like to further develop their ICT skills; whereas 40 % of Europeans aged 16-74 have low or no ICT skills;

G. whereas open educational resources (OERs) can play a crucial role in facilitating lifelong learning for all learners and in improving the quality of content and the distribution of both formal and informal education providers, and whereas, at the same time, a digitally inadequate education system can hamper the development of learners’ knowledge and skills;

H. whereas the EU has still not fully grasped the potential of ICT in terms of cultural and educational wealth and diversity, access to information and the exchange of good practices;

I. whereas the modernisation of education systems in Europe requires investment in education facilities that are well equipped in terms of information and communication technologies;

J. whereas, it is therefore vital that broadband access become more widespread, including in the rural, mountain and outlying areas of the Member States;

K. whereas schools should also train children and young people in the practical and critical use of digital technologies and the internet;

Opportunities and challenges

1. Welcomes the Commission communication which sets out a Union agenda in the field of OERs, and which focuses on the potential of these resources to widen access to and equity in education and further diversify it, and acknowledges the relevance of OERs in an increasingly digital society; believes that the emergence of a European framework for the development of OERs may allow for improvement in the Member States’ education systems;

2. Notes that, in order to realise the benefits of OERs, actions leading to universal digital education should be supported, with a focus on good practices and their promotion in various environments;

3. Emphasises that OERs create opportunities for both individuals, such as teachers, students, pupils and learners of all ages, and educational and training institutions to teach and learn in innovative ways; calls on educational institutions to further assess the potential benefits of OERs in the respective educational systems and in view of possibly creating an organisational environment in which such innovation is welcomed, internalised, applied and promoted; calls, in this connection, on the Member States and regions, as part of smart

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specialisation strategies, to establish innovation and start-up centres of excellence which make full use of the potential of ICT;

4. Deplores the lack of differentiation in the Commission communication between school levels as regards the deployment of new technologies and digital content for learning and teaching purposes; stresses that learners acquire different skills and competences depending on their age, and that consequently curricula and learning methods vary according to school level;

5. Notes that quality assurance plays a crucial role in increasing the trust in and use of OERs; encourages research on and the dissemination of good practices to facilitate the effective use of OERs, investing, in particular, in the areas of methodological experimentation, meta-skills (reflexive, proactive and critical thinking skills) and soft skills; notes that research should also be encouraged with regard to the methods of assessing the skills acquired for such courses which cannot be restricted to peer assessment or automated systems, as occurs in communities of practice;

6. Acknowledges the fact that OERs are generally produced in a limited number of languages and mainly, although not exclusively, by higher education institutions (especially as regards massive open online courses (MOOCs)); encourages education and training institutions at all levels across the Member States, as well as other relevant stakeholders, to produce OERs in their own languages in order to exploit the full potential of digital technology and multilingualism; recalls that the availability, accessibility and innovativeness of materials plays a key role in terms of using e-learning materials in education;

7. Points out that ICT and OERs are currently mainly used in higher education; encourages, where appropriate, their use in primary and secondary education, as well as in vocational education and in other informal learning settings, where student-centred learning combined with ICT also carries huge potential;

8. Notes that proper contextualisation is a critical factor in making educational software effective; points out that this process must be suitably embedded into teaching and learning processes, and must take into account pedagogical and curriculum objectives, tools and individual learning paths;

9. Stresses the need to facilitate the recognition of knowledge and skills acquired through OERs by means of further dialogue with stakeholders, and calls on the Member States to incorporate appropriate measures into their national qualification frameworks for the validation of such learning;

10. Points to the need to make it easier to obtain recognition for skills acquired abroad, in order to boost and facilitate the use of OERs and MOOCs by pruning bureaucratic structures;

11. Highlights the fact that availability of and access to free, high-quality and suitable online teaching materials is crucial;

12. Stresses the need for the harmonisation of existing limitations and exceptions in copyright for the purpose of illustration in non-commercial teaching, in order to facilitate OERs and distance learning across borders, and to allow European platforms to compete globally by creating economies of scale;

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13. Urges the Commission to put forward a proposal to review Directive 2001/29/EC, with the aim of establishing a harmonised and flexible system of copyright and related rights in the EU which is fit for the digital age and acknowledges the public value of access to knowledge;

14. Encourages Member States to explore the predicted potential of OERs for reducing the public and private costs of education, in particular the costs of education materials, without neglecting quality;

15. Notes the importance of ensuring sustainable models for the creation of OERs and MOOCs; calls on the Commission to support further research into the formation, usage and uptake thereof, in dialogue with stakeholders;

16. Acknowledges that the adoption of OERs should be done in a manner that fosters development of 21st century learning solutions, and creates new business opportunities for small and medium-sized innovative European providers of learning solutions;

17. Calls on the Member States to strengthen informal education on online safety and to provide for online safety policies in schools by offering appropriate training to teachers;

18. Calls on the Member States to ensure coordinated and progressive education on internet safety in schools; notes that parents and legal guardians should be regarded as partners in ensuring web safety, and recommends that complementary strategies targeting them be developed, thereby strengthening the role of parental mediation; stresses the fact that these efforts should be aimed at strengthening young people’s independence so that they can take ownership of their actions and responsibilities on the web and develop e-skills; insists that the protection of the physical and psychological integrity and privacy of teachers and learners using OERs must be assured;

19. Calls on the Commission to support the exchange of good practices between Member States in the formal and informal education sectors with regard to online safety, the creation of relevant educational content and the formation of public-private partnerships with the aim of involving young people, their parents and teachers and all those who work with young people, including the non-governmental organisations involved in the Safer Internet network;

Skills for teachers and learners

20. Notes that new technologies and OERs allow for a more interactive learning experience and are valuable instruments in placing the learner at the centre of the educational process;

21. Stresses that teachers at all levels of education have a fundamental role in facilitating access to and the use of online learning materials by all learners and in assisting them in acquiring digital skills;

22. Stresses the urgent need for all learners to have the fastest and best possible technical equipment, as well as vital access to broadband internet;

23. Recalls the crucial importance of high-quality training for teachers and trainers that must be complemented with mandatory career-long professional training focusing on innovative

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teaching methods and instructing learners about approaches to education (‘learning how to learn’);

24. Urges the Member States to support teachers in their professional development by offering them modern curricula in their initial education, and by providing them with in-service training geared to equip them with the necessary competences for the use of digitally supported teaching methods;

25. Emphasises, in particular, the proven benefits of European experience abroad for teachers and trainers, for example through the Erasmus+ programme, and calls for a massive expansion of this and other related programmes;

26. Points out that basic literacy and numeracy skills, in addition to meta-skills and soft skills, as well as transversal skills, such as critical thinking and learning to learn, are a prerequisite for developing digital skills and using online educational materials, including OERs, effectively; calls, in this context, on the Commission to further assess the impact of digital and/or online learning materials on the learning performance of learners according to their age and school level;

27. Recognises the importance of traditional ways of teaching and learning, and calls on the Commission to support further research into the question of whether and how OERs and MOOCs can enhance individuals’ learning outcomes in addition to, or as an integral part of, traditional teaching methods;

28. Recalls that innovative teaching methods facilitated through ICT and OERs contribute to the development of soft and transversal skills, such as critical thinking, decision-making, communications skills and problem-solving, which are crucial for employability and job market realisation;

29. Stresses that education policies should primarily aim at assisting learners in the development of crucial cognitive and social skills; calls on the Commission to further assess the impact on learners of deploying digital devices and contents for pedagogical purposes while ensuring their physical and psychological integrity;

30. Points out that OERs geared towards the needs of adult learners should be developed so as to ensure greater lifelong learning opportunities for low-skilled European citizens, bearing in mind the fact that many learners have low ICT skills;

31. Underlines the fact that digital skills and knowledge are vital for citizens in an information-driven society that aims to become the most dynamic knowledge-based economy in the world;

32. Notes that digital literacy, in opening up new channels for communication and education, has a positive impact in terms of strengthening social cohesion, personal development, intercultural dialogue and active citizenship;

33. Highlights the fact that ICT and online educational materials, including OERs, can support the teaching and learning of foreign languages at all levels of education and training; stresses that social interaction is a prerequisite for learning a foreign language;

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34. Urges the Member States to improve and deepen digital skills also by including coding and programming in their respective curricula, in order to foster economic competitiveness and equip students with the right skills for the job market of the future;

35. Reiterates that continuous updating of knowledge and skills is essential for successful labour market integration, and notes that OERs can contribute to facilitating the lifelong learning that is necessary in order to remain competitive on the labour market; encourages a more gender-balanced use of ICT with a view to ensuring that women who remain outside the labour market for a given period, for example for maternity or other family care tasks, are also able to benefit from this type of training to update their skills and educate themselves, thereby improving their future re-employment opportunities on the labour market;

36. Points out that public libraries and education centres can offer free access to computers and the internet and training on internet resources;

Widening the reach

37. Stresses the importance of access to education and training and IT equipment for all learners in all age groups, as well as for those with disabilities, those coming from disadvantaged backgrounds, young people currently not in education, employment or training (NEET) and those coming from geographically remote regions, as well as anyone wishing to improve their qualifications;

38. Notes, once again, that not everyone has access to ICTs under equivalent pricing arrangements and in terms of service quality, and that, in general, urban areas are better served than rural areas, thereby creating a digital divide that undermines the notion of equal opportunities for all citizens, wherever they may be in the EU;

39. Stresses the growing importance of adult education, particularly in the context of lifelong vocational training, and calls for the Europe-wide recognition, strengthening and promotion of all adult education organisations;

40. Highlights the advantages of inter-generational learning, and points to the great educational potential offered by digital learning and OERs, also as regards wider access to education and training for all age groups;

41. Acknowledges that new technologies and OERs, in particular MOOCs, have made it possible for education and training institutions to reach thousands of learners in the Union, including in its outermost regions, and around the world; recognises that education and knowledge now travel easily across borders, which increases the potential for international cooperation and helps to promote European educational institutions as centres for innovation and the development of new technologies;

42. Notes that it is important to keep a fair balance between the quality and accessibility of education; highlights the fact that new technologies can be used to ensure that more accessible education does not mean a reduction in the quality of education;

43. Notes that the EU risks falling behind other regions of the world, such as the United States or Asia, where heavy investments are made in research and development, new technologies and OERs; insists that the Union must build on its strength in cultural and linguistic

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diversity and adapt investments in e-learning material, including OERs, and in new technologies to best support its population;

44. Recalls that new technologies can contribute to the competitiveness of European education on the global stage, offer opportunities for the internationalisation of European higher education, and, as a result, increase Europe’s attractiveness as an educational destination;

45. Stresses that OERs can contribute to improving the quality of European education; encourages, in this connection, cooperation with educational institutions around the world, in particular in the United States;

46. Reiterates that successful OER strategies and MOOCs can support internationalisation strategies by improving the quality and visibility of European (higher) education institutions and attracting students and researchers in an increasingly global competition for talent;

47. Calls on the Member States to promote cooperation and synergies in the field of lifelong learning, in particular to make it as easy as possible to gain access to learning and to adapt and modernise the curricula of educational institutions to the rapidly developing potential and possibilities of digital learning and OERs, in order to address the new challenges of the contemporary world as effectively as possible;

48. Encourages strengthened cooperation between European education and training institutions, and with international organisations and stakeholders, to facilitate a better understanding of new teaching and learning methods and the impact of ICT on education; encourages the development of common platforms for such cooperation;

49. Stresses that the use of new technologies in education should be well targeted to respond to the needs of the job market and overcome the present skills gap; stresses the need for improved communication and cooperation between educational and training institutions and the business sector;

50. Notes that new technologies and e-learning have the added value of providing an international learning experience for those who do not participate in mobility schemes;

51. Points out that digital technologies are not fully exploited in education and training across the Union; fears that this situation may lead to a further fragmentation of teaching and learning approaches; calls on the Member States to apply equity principles to the new markets, given that OERs should remain a tool to broaden access to education and not become a purely economic endeavour;

52. Stresses that digital technology is an important learning tool for citizenship, facilitating the participation of many citizens living in peripheral areas and especially of young audiences, allowing them to benefit fully from freedom of expression and online communication;

The contribution of EU programmes

53. Welcomes the launch of the Open Education Europa portal in all EU languages, providing a single gateway to European OERs, and calls for the portal to be vigorously developed and promoted in the Member States;

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54. Notes that an appropriate digital infrastructure based on commonly used, popular technologies is a prerequisite for reaching the highest possible number of learners with OERs;

55. Calls on the Commission to organise an annual European regional planning conference to ensure that all citizens have access to ICT services wherever they may be in the EU;

56. Points out that local and regional authorities have a key role to play in developing infrastructures, disseminating and publicising various measures to a wider public, involving other local stakeholders and disseminating and implementing the relevant European initiatives at national, regional and local level;

57. Calls on the Member States and the local and regional authorities to use the funding available through the European Structural and Investment Funds to overcome the territorial digital divide by improving infrastructure and networks and promoting training in ICT and the effective use thereof, taking into account the needs of educational institutions, in particular in rural and remote regions; notes that the smart and comprehensive use of EU funding requires synergy between the different programmes and instruments, including Erasmus+, Horizon 2020 and the structural and investment funds;

58. Calls on the Commission to encourage the exchange of good practices between Member States and between educational institutions, drawing on existing projects and experiences;

59. Welcomes the Commission initiative to develop indicators to closely monitor the integration of ICT in teaching and training institutions, and to support Union-wide quantitative surveys;

60. Calls on the Commission to promote and extend the network and action of European Schoolnet;

61. Appreciates that all educational materials drawn up with support from Erasmus+ will be available to the public under open licences; encourages similar practices for other Union programmes, including a broad roll-out of open access under the Horizon 2020 programme;

62. Highlights the fact that Erasmus+ and Horizon 2020 can play an important role in generating OERs through communities of practice, such as that of school teachers using the eTwinning platform; encourages an extension of the use of these platforms to other educational sectors;

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63. Instructs its President to forward this resolution to the Council, the Commission and the governments and parliaments of the Member States.

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P7_TA-PROV(2014)0396

Voting in the context of procedures concerning the immunity of Members (interpretation of the Rules of Procedure)

European Parliament decision of 15 April 2014 concerning voting in the context of procedures concerning the immunity of Members (interpretation of Rules 166, 167(1) and 195(3)) (2014/2028(REG)

The European Parliament,

– having regard to the letter of 9 April 2014 from the Chair of the Committee on Constitutional Affairs,

– having regard to Rule 211 of its Rules of Procedure,

1. Decides to append the following interpretation to Rules 166, 167(1) and 195(3):

"Rule 166, Rule 167(1) and Rule 195(3) on voting by roll call do not apply to the reports provided for in Rule 6b(2) and Rule 7(3), (6) and (8) in the context of procedures relating to the immunity of a Member."

2. Instructs its President to forward this decision to the Council and the Commission, for information.

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