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Legal foundation
The EU budget is regulated by 3 types of legal acts:
- EU treaties
- EU legislation (regulations and decisions)
- agreements between the EU institutions
The agreements are unique to the budget – they have no equivalent in other areas of EU law.
EU Budget as defined in the EU treaties
The EU budget system is defined in:
- Treaty on the Functioning of the EU (Treaty of Lisbon)
- Treaty on European Union
EU Budget as defined in EU legislation
The principles set out in the treaties are implemented in practice by the following legislation:
- decision on the system of EU own resources
- regulation on the new financial framework for 2007-2013
- Financial Regulation and its implementing rules
EU Budget as defined in the interinstitutional agreement
The purpose of the interinstitutional agreement is threefold:
- to implement budgetary discipline;
- to improve the functioning of the annual budgetary procedure and the cooperation between the institutions on budgetary matters
- to ensure sound financial management.
A number of agreements or joint declarations have been concluded since the mid-1970s. They were incorporated, with certain updates or additions, into the Interinstitutional Agreement concluded in 1999, which in some ways constitutes a ‘Charter’ of agreements reached by the institutions on the budget.
The 1999 Interinstitutional Agreement has been replaced by a new one signed on 17 May 2006 which entered into force on 1 January 2007. The Annex of this agreement establishes the Financial Framework for the period of 2007-2013. Before 1 July 2011, the Commission will present proposals for a new medium-term financial framework (Point 30, IIA).
The Multifinancial Framework is now specifically mentioned in Article 312 of the Treaty on the Functioning of the EU.