What changed

(6) The 2024 reform of the Union’s economic governancedid frameworknot eliminatedretain the concept of a significant deviation andor the related procedure fromin the requirementspreventive arm of Regulationthe (EU)Stability 2024/1263,and Growth Pact, in line with the intention of the co-legislators to simplify the fiscal framework and to applyintroduce a risk-based approach. With the removal of the significant deviation procedure,Therefore, the requirement for a Member State to lodge an interest-bearing deposit with the Commission an interest-bearingin deposit,the triggeredevent byof a failure to comply with a significant deviation procedure,procedure should be deleted from Regulation (EU) No 1173/2011. Article 1, point (10), of Regulation (EU) 2024/1264 amended Regulation (EC) No 1467/97 by reducing the amount of financial sanctions allowed under the corrective arm, while making the imposition of those sanctions more gradual. Regulation (EU) No 1173/2011 should be amended to reflect those principles for the imposition of financial sanctions with respect to the imposition of fines.

(7) In order to enhance the dialogue between the institutions of the Union, in particular the European Parliament, the Council and the Commission, and to ensure greater transparency and accountability, Regulation (EU) No 1173/2011 allows for an economic dialogue between the institutions of the Union, upon the invitation of the competent committee of the European Parliament, to discuss decisions taken in relation to the imposition of financial sanctions due to non-compliance with the Union’s fiscal rules. ▌

(7) No fines are to be imposed under Regulation (EU) No 1173/2011 where the excessive deficit procedure is placed in abeyance or where the Commission proposes the imposition of fines under Article 126(11) TFEU, in accordance with Articles 11 and 12 of Regulation (EC) No 1467/97. Fines are entered in the general budget of the Union as revenue, in line with the principle of universality of the Union budget in accordance with Article 107 of Regulation (EU, Euratom) 2024/2509 of the European Parliament and of the Council. Regulation (EU) No 1173/2011 should therefore be amended to remove references to the distribution of fines, which will, by default, follow the principle of universality.

(8) The power to adopt delegated acts related to the imposition of sanctions concerning the manipulation of statistics, conferred on the Commission under Regulation (EU) No 1173/2011, is no longer needed and should be deleted.

(8) Regulation (EU) No 1173/2011 allows for an economic dialogue between the institutions of the Union, upon the invitation of the competent committee of the European Parliament, to discuss decisions on the imposition of financial sanctions for non-compliance with the Union’s fiscal rules. ▌

(9) Regulation (EU) No 1173/2011 should be amended to clarify the deadline and the content of the Commission’s report on the application of that Regulation.

(9) In order to preserve transparency, accountability and ownership for the decisions taken, the documents and acts to be provided by the Commission to the Council as specified in this Regulation should be made available to the European Parliament without undue delay.

(10) The national medium-term fiscal-structural plans, introduced by Regulation (EU) 2024/1263, are the cornerstone of the 2024 reform. They replaced the Stability and Convergence Programmes and the National Reform Programmes, thereby bringing together the fiscal, reform and investment commitments of each Member State within a common framework. Regulation (EU) No 473/2013 should be amended to take into account the introduction of the national medium-term fiscal-structural plans in the common framework.

(10) The power conferred on the Commission by Regulation (EU) No 1173/2011 to adopt delegated acts on financial sanctions for the manipulation of statistics is no longer needed and should therefore be deleted.

(10a) Regulation (EU) 2024/1263 requires national medium-term fiscal-structural plans to address the Union’s common priorities. In accordance with Article 13, point (c), of that Regulation, those common priorities include a fair, green and digital transition, including the climate objectives set out in Regulation (EU) 2021/1119 of the European Parliament and of the Council, as well as social and economic resilience, including the European Pillar of Social Rights, energy security, and, where necessary, the build-up of defence capabilities.

(11) Regulation (EU) No 1173/2011 should be amended to clarify the content of the Commission’s report on the application of that Regulation and the deadline for its submission.

(11) Regulation (EU) 2024/1263 established provisions to ensure consistency with Regulation (EU) No 1176/2011 of the European Parliament and of the Council, in particular by integrating in the procedure set out by Regulation (EU) 2024/1263 measures and reforms to be taken in the context of the procedure for prevention and correction of excessive macroeconomic imbalances. Specifically, in accordance with Article 31(1), point (a), of Regulation (EU) 2024/1263, an unsatisfactory implementation of reforms and investments included in a Member State’s national medium-term fiscal-structural plan that are relevant for macroeconomic imbalances is to be taken into account by the Commission when undertaking in-depth reviews and when considering whether to establish the existence of an excessive imbalance under Regulation (EU) No 1176/2011. Moreover, in accordance with Article 17(2) of Regulation (EU) 2024/1263, when an excessive imbalance procedure is launched, the Member State is to submit a revised medium-term fiscal-structural plan, which is also to serve as its corrective action plan under Regulation (EU) No 1176/2011.

(12) The national medium-term fiscal-structural plans introduced by Regulation (EU) 2024/1263 form the cornerstone of the 2024 reform. They replaced the stability and convergence programmes and the national reform programmes, thereby bringing together the fiscal, reform and investment commitments of each Member State under a common framework. Regulation (EU) No 473/2013 should be amended in order to align it with that common framework.

(12) In order to simplify the Union’s fiscal framework and increase transparency, the 2024 reform introduced a single operational indicator anchored in debt sustainability which serves as a basis for setting the fiscal path and for carrying out annual fiscal surveillance for each Member State. That single operational indicator, based on the net expenditure path, replaces the medium-term objective, the structural balance, the net expenditure benchmark and the debt reduction benchmark of the previous fiscal framework. Member States under an excessive deficit procedure (EDP) receive a corrective net expenditure path based on Council Regulation (EC) No 1467/97.

(13) Regulation (EU) 2024/1263 ensures consistency with Regulation (EU) No 1176/2011 of the European Parliament and of the Council. In particular, Regulation (EU) 2024/1263 integrates measures and reforms to be taken in the context of the procedure for prevention and correction of excessive macroeconomic imbalances. More specifically, Regulation (EU) 2024/1263 provides that when undertaking in-depth reviews and when considering whether to establish the existence of an excessive imbalance under Regulation (EU) No 1176/2011, the Commission is to take into account any unsatisfactory implementation of the reforms and investments included in a Member State’s national medium-term fiscal-structural plan that are relevant for macroeconomic imbalances. Moreover, in accordance with Article 17(2) of Regulation (EU) 2024/1263, when an excessive imbalance procedure is launched, the Member State is to submit a revised medium-term fiscal-structural plan, which is also to serve as its corrective action plan under Regulation (EU) No 1176/2011.

(13) In order to simplify the legal framework, the definition of an independent body in Regulation (EU) No 473/2013 should be amended to refer to Article 8a of Council Directive 2011/85/EU which established provisions to ensure that the requirements for independence safeguards, resources and tasks apply to those independent bodies in all Member States. Moreover, Article 4(5) of Directive 2011/85/EU already provides for a technical dialogue between Member States and the Commission on the assumptions underpinning the macroeconomic and budgetary forecasts. It is therefore not necessary to include that provision in Regulation (EU) No 473/2013.

(14) In order to simplify the fiscal framework of the Union and increase transparency, the 2024 reform introduced a single operational indicator anchored in debt sustainability, which serves as a basis for setting the fiscal path and for carrying out annual fiscal surveillance for each Member State. That single operational indicator, based on the net expenditure path, replaces the medium-term objective, structural balance, net expenditure benchmark and debt reduction benchmark of the previous fiscal framework of the Union. For Member States subject to an excessive deficit procedure, the Council recommends a corrective net expenditure path in accordance with Regulation (EC) No 1467/97.

(15) Regulation (EU) 2024/1263 provides that independent fiscal institutions may be asked to issue opinions on the macroeconomic forecast and on the macroeconomic assumptions underpinning the net expenditure path of the national medium-term fiscal-structural plan or of the revised national medium-term fiscal-structural plan. From 2032 onwards, the opinion of those institutions becomes mandatory, provided that they have built sufficient capacity. Moreover, independent fiscal institutions may be asked to provide an assessment of the budgetary outturns reported in the annual progress report with the net expenditure path as set by the Council. The relevant independent fiscal institutions may also be requested to analyse the factors behind a deviation from the set net expenditure path. In order to ensure consistency with the 2024 reform of the Union’s economic governance framework and improve the effectiveness of independent fiscal institutions, Regulation (EU) No 473/2013 should be amended to reflect the changes to the role of independent fiscal institutions introduced by Regulation (EU) 2024/1263.

(16) Directive 2011/85/EU establishes the procedures for national medium-term budgetary frameworks providing for the adoption of multiannual fiscal planning. In addition, Article 9(2), point (c), of that Directive requires the national medium-term budgetary frameworks to include, inter alia, a description of envisaged medium-term policies, including reforms and investments, with an impact on general government finances and sustainable and inclusive growth. In order to simplify the legal framework, Regulation (EU) No 473/2013 should be amended to avoid a repetition of the provisions already laid down in Directive 2011/85/EU.

(16) Regulation (EU) No 473/2013 should be amended to ensure that national budgetary procedures are consistent with the recommendations issued in the context of Regulation (EU) 2024/1263, with recommendations and decisions issued in the context of Regulation (EC) No 1467/1997, with decisions under Regulation (EU) No 1173/2011 where appropriate and with the rules and procedures laid down in Directive 2011/85/EU.

(17) Independent and effective fiscal institutions play an important role in the national budgetary frameworks of Member States and in the fiscal framework of the Union. Directive 2011/85/EU establishes the minimum standards applicable to, and the tasks of, independent fiscal institutions, including the task of monitoring compliance with the national numerical fiscal rules unless that task is performed by other bodies with functional autonomy vis-à-vis the fiscal authorities of the Member States. Member States can establish more than one such institution. Regulation (EU) 2024/1263 provides that a Member State can ask the independent fiscal institution to issue an opinion on the macroeconomic forecast and the macroeconomic assumptions underpinning the net expenditure path of the initial or revised national medium-term fiscal-structural plan. From 2032, the issuing of such opinions by those institutions becomes mandatory, provided that they have built sufficient capacity. In addition, Member States can request an independent fiscal institution to provide an assessment of the compliance of the budgetary outturns data reported in the annual progress report with the net expenditure path as set by the Council and to analyse the factors behind a deviation from the set net expenditure path. ▌

(17) Regulation (EU) No 473/2013 should be amended to prescribe that the draft budgetary plans (‘DBPs’) should be consistent and comply with the requirements resulting from the 2024 reform of the Union’s governance framework. The DBPs should reflect the implementation of the Council Recommendations regarding the medium-term fiscal-structural plans. In that respect, they should set out how the fiscal policy strategy will be delivered in the next year, and present the concrete expenditure and revenue measures that ensure compliance with the net expenditure path set by the Council under Regulation (EU) 2024/1263 or explain any deviations from that net expenditure path. If the Member State is under an EDP, the DBPs should present concrete expenditure and revenue measures that ensure compliance with the corrective path set under Regulation (EC) No 1467/97.

(18) Regulation (EU) No 473/2013 should be amended to ensure that national budgetary procedures are consistent with the recommendations adopted pursuant to Regulation (EU) 2024/1263, and, where applicable, recommendations and decisions adopted pursuant to Regulation (EC) No 1467/97 and decisions adopted pursuant to Regulation (EU) No 1173/2011 and with the rules and procedures laid down in Directive 2011/85/EU.

(18) At the same time, for simplification purposes and to reduce administrative burden, Regulation (EU) No 473/2013 should be amended to reduce the reporting obligation of Member States regarding data that in the past proved not to provide a clear value added. In addition, to reduce the reporting burden and considering that reporting to the Commission is sufficient to allow for the coordination of the national debt issuance of Member States on the Union’s Sovereign Debt Markets, Regulation (EU) No 473/2013 should be amended to eliminate ex ante reporting by Member States on their public debt issuance plans to the Eurogroup.

(19) Regulation (EU) No 473/2013 should be amended to provide that draft budgetary plans should be consistent and should comply with the requirements resulting from the 2024 reform. The implementation of the Council recommendations regarding the medium-term fiscal-structural plans should be reflected in draft budgetary plans. Therefore, draft budgetary plans should set out how the fiscal policy strategy will be delivered in the next year, and present the ▌ expenditure and revenue measures that ensure compliance with the net expenditure path as set by the Council under Regulation (EU) 2024/1263 or explain any deviation from that net expenditure path. If the Member State is subject to an excessive deficit procedure, its draft budgetary plan should present the expenditure and revenue measures that ensure compliance with the corrective net expenditure path as set by the Council under Regulation (EC) No 1467/97.

(19)(20) InFor orderthe topurposes simplifyof EUsimplification fiscaland surveillancein andorder to reduce administrative burden, theRegulation Commission(EU) No 473/2013 should nobe longeramended reportso inthat itsMember overallStates assessmentare ofno thelonger budgetaryrequired situationto andreport prospectsdata inthat theexperience eurohas areashown asto abe wholeof onlimited elementsadded thatvalue. haveIn notaddition, provensince reporting to providethe addedCommission valueis insufficient for the surveillancepurposes processof (suchcoordinating asthe anational sensitivitydebt analysesissuance of Member States on the riskssovereign todebt publicmarkets, financeRegulation sustainability(EU) inNo the473/2013 eventshould ofbe adverseamended economic,so financialthat orMember budgetaryStates developmentsare orno thelonger methodology,required modelsto andreport assumptionsex ofante to the mostEurogroup recenton economictheir forecastspublic ofdebt theissuance Commissionplans, servicesthereby forreducing eachtheir Memberreporting State.)burden.

(20) In case a government is not in a position to prepare a draft budget law for adoption by the national parliament, the submission of a DBP at unchanged policies is also not needed and should be replaced by a technical exchange whereby Member States provide the Commission with information regarding the macroeconomic and budgetary positions which the Commission will include in its forecasts.

(21) In order to simplify fiscal surveillance in the Union and to reduce administrative burden, the Commission should no longer be required to include in its overall assessment of the budgetary situation and prospects in the euro area as a whole elements that have not provided added value in the surveillance process. Such elements include sensitivity analyses of the risks to public finance sustainability in the event of adverse economic, financial or budgetary developments and the methodology, models and assumptions of the most recent economic forecasts of the Commission services for each Member State.

(21) The 2012 Treaty on Stability, Coordination and Governance in the Economic and Monetary Union has established the economic partnership programmes, which became part of the Union’s economic governance framework in 2013 by virtue of Regulation (EU) No 473/2013. Their aim was to ensure a sustainable and lasting correction of the excessive deficits of Member States by requiring that Member States under EDP detail specific structural reforms designed to reduce their deficit and debt. The function of economic partnership programmes is ensured in the 2024 reform of the Union’s governance framework through two main channels. The first is through the adoption of a medium-term and risk-based approach in the medium-term fiscal-structural plans, which include the impact of reforms and investments on fiscal sustainability. The second is through the reinforcement of the EDP through the introduction of clear activation and abrogation criteria for debt-based EDPs. Therefore, Regulation (EU) No 473/2013 should be amended to take into account that economic partnership programmes have become obsolete.

(22) Where the government of a Member State is not in a position to prepare a draft budget law for adoption by its national parliament, the submission of a draft budgetary plan based on unchanged policies should not be required. Instead, that requirement should be replaced by a technical exchange, whereby the Member State concerned provides the Commission with information on its macroeconomic and budgetary situation, which will be taken into account by the Commission in its forecasts.

(22) Regulation (EU) No 473/2013 introduced additional reporting requirements for Member States whose currency is the euro and which were subject to an EDP under Regulation (EC) No 1467/97. The objective of those additional requirements was to allow for a better exchange of information between the Member States concerned and the Commission and to identify risks in the compliance with the deadline for the correction of the excessive deficit early on. The 2024 reform of the Union’s economic governance framework introduced a single indicator for the assessment of compliance with the corrective net expenditure path under the EDP. Member States are to regularly report on it in their annual progress reports submitted under Regulation (EU) 2024/1263. Therefore, Regulation (EU) No 473/2013 should be amended to reduce the reporting burden and focus on implementing the 2024 reform. Member States subject to an EDP should only provide the information requested under Regulation (EU) 2024/1263, Regulation (EC) No 1467/97 and the subsequent effective action reports pertaining to Council recommendations under Article 126(7) TFEU or Council notices under Article 126(9) TFEU as foreseen in Regulation (EU) 473/2013, given that that information is sufficient to assess compliance with the corrective net expenditure path. The Commission should retain the right to request any additional information it deems necessary for budgetary surveillance purposes.

(23) Economic partnership programmes were introduced by the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union of 2 March 2012 and were incorporated into the economic governance framework of the Union in 2013 by Regulation (EU) No 473/2013. The aim of economic partnership programmes was to ensure the effective and durable correction of Member States’ excessive deficits by requiring Member States subject to an excessive deficit procedure to describe the policy measures and structural reforms needed for the purposes of reducing their excessive deficit. Under the 2024 reform, the role previously played by economic partnership programmes is fulfilled by two main means. The first consists of the adoption of a medium-term, risk-based approach in the medium-term fiscal-structural plans, which take into account the impact of reforms and investments on fiscal sustainability. The second consists of the reinforcement of the excessive deficit procedure through the introduction of clear activation and abrogation criteria for a debt-based excessive deficit procedure. Regulation (EU) No 473/2013 should therefore be amended to take into account the fact that economic partnership programmes have become obsolete.

(23) As this additional reporting is no longer required, Regulation (EU) 473/2013 should be amended to remove the empowerment to adopt delegated acts to specify the content of the additional reporting.

(24) Regulation (EU) No 473/2013 introduced additional reporting requirements for Member States whose currency is the euro and which are subject to an excessive deficit procedure under Regulation (EC) No 1467/97. The objective of those requirements was to improve the exchange of information between the Member States concerned and the Commission, and to identify, at an early stage, any risks of non-compliance with the deadline for the correction of the excessive deficit. The 2024 reform introduced a single indicator for the assessment of compliance with the corrective net expenditure path under the excessive deficit procedure. Member States are to report on that indicator on a regular basis in their annual progress reports submitted under Regulation (EU) 2024/1263. Regulation (EU) No 473/2013 should therefore be amended to reduce the reporting burden and focus on implementing the 2024 reform. Member States subject to an excessive deficit procedure should be required to provide only the information requested under Regulations (EU) 2024/1263 and (EC) No 1467/97 and the subsequent reports on effective action pertaining to Council recommendations under Article 126(7) TFEU or Council notices under Article 126(9) TFEU as provided for in Regulation (EU) No 473/2013, given that such information is sufficient to assess compliance with the corrective net expenditure path. The Commission should retain the right to request any additional information it considers necessary for budgetary surveillance purposes. Therefore, Regulation (EU) No 473/2013 should be amended to remove the empowerment of the Commission to adopt delegated acts to specify the content of additional reporting.

(24)(25) In accordance with Council recommendations under Article 126(7) TFEU or notices under Article 126(9) TFEU, Member States that are subject to reportan excessive deficit procedure are required to submit reports on actioneffective taken.action. In order to ensure anthat effectivea monitoring of action taken to correct the excessive deficit,deficit is effective, Regulation (EU) No 473/2013 should be amended to clarify the reporting obligations stemming from those Council recommendationsrecommendations. andIn toparticular, obligea Member States to submit follow-upState reportsthat tois the Commissionaddressee andof thea Council onrecommendation effectiveunder actionArticle every126(7) sixTFEU monthsshould whensubmit theyfollow-up arereports subjecton effective action to athe CouncilCommission Recommendationand underthe ArticleCouncil 126(7)every TFEUsix months until the Council abrogates the decision on the existence of an excessive deficit. Moreover,In theaddition, a Member State that is the addressee of a Council notice under Article 126(9) TFEU should submit follow-up reports on effective action to the Council and the Commission on a quarterly basis when it is the subject of a Council notice under Article 126(9) TFEU until the Council abrogates the decision on the existence of an excessive deficit. In order to reduce the reporting burden on Member States, it should be possible to include such reports on effective action reports in the annual progress reports asprovided definedfor underin Regulation (EU) 2024/1263 andand, where appropriate, in the DBP,draft wherebudgetary possible.plans. Since the EDPcloser monitoring of the budgetary policies of Member States subject to an excessive deficit procedure is to be replaced by the reporting specifiedrequirements under Regulation (EC) No 1467/97, the Commission should takeCommission, intowhen accountassessing allthe effective action reports transmittedtaken by the Member StateState, whenshould makingtake itsinto assessmentaccount ofall reports on effective action.action that are submitted by the Member State.

(25)(26) Regulation (EU) No 473/2013 should be amended to simplify existing procedures and eliminateto discontinue those that have not proven useful and are notthat inare lineinconsistent with the overall approach of the revised2024 framework.reform. In particular, the provisions requiring the Commission to address to the Member State a recommendationCommission, inwhere casethere ofis a risk of non-compliance with the deadline to correct the excessive deficit should be deleted, as the 2024 reform of the economic governance framework introduced a medium-term approach that is no longerdeficit, focusedto onaddress a specific year for the correctionrecommendation ofto the excessive deficit, butMember ratherState aimsshould tobe ensuredeleted, thatreflecting the government deficit is brought and maintainedmore belowmedium-term 3%focus of GDP over the medium2024 term.reform.

(26)(27) Pursuant to Article 2(3) of Regulation (EC) No 1467/971467/97, requiresthe thatCommission is to take into account all relevant factors as indicated in Article 126(3) TFEU be taken into account when preparing a report under Article 126(3)that TFEUArticle on the existence of an excessive deficit. AnIt explicitis requirementtherefore fornot necessary to explicitly require the CommissionCommission’s opinion adopted under Article 7(1) of Regulation (EU) No 473/2013 to be taken into account when draftingthe Commission prepares a report under Article 126(3) TFEU or when takingthe Council takes a decision on the existence of an excessive deficit under Article 126(6) TFEUTFEU. isIn thereforeaddition, notin necessary.view Moreover,of takingthe deletion of Article 5 of Regulation (EU) No 1173/2011, the requirement to take into account the CommissionCommission’s opinion underadopted pursuant to Article 7(1) of Regulation (EU) No 473/2013 when recommending the imposition of a non-interest bearing deposit under Article 5 of Regulation (EU) No 1173/2011 is outdated given the deletion ofno thatlonger Article.relevant.

(28)(29) The Union’s strategy for growth and jobs is implemented through the Commissiondelivery prioritiesof forreforms 2024-2029and investments which focusaddress onthe main challenges identified in the improvementcontext of the European Semester and which focus on improving social and economic resilience and sustainable and inclusive growth by boosting competitiveness, productivity, growth potential, social cohesion and economic convergence, thereby helping to address the medium- and long-term challenges facing the Union. In particular, Article 13 of Regulation (EU) 2024/1263 requires that Member States explain in their medium-term fiscal-structural plans how the delivery of reforms and investments responds to the main challenges identified in the context of the European Semester, in particular in the country-specific recommendations. It also requires Member States to explain how they will address the following common priorities of the Union: a fair, green and digital transition, including the climate objectives set out in Regulation (EU) 2021/1119 of the European Parliament and of the Council, social and economic resilience, including the European Pillar of Social Rights, energy security and, where necessary, the build-up of defence capabilities.

(3a) the following article is inserted:

(4) Chapter III is deleted;

‘Article 3a

(5) the title of Chapter IV is replaced by the following:

Information to the European Parliament

‘Chapter IV

1. Information transmitted by the Commission to the Council or any of its preparatory bodies in the context of this Regulation or its implementation shall simultaneously be made available to the European Parliament, subject to confidentiality arrangements if necessary. Relevant outcomes of discussions held in Council preparatory bodies shall be shared with the competent committee of the European Parliament.

SANCTIONS IN THE CORRECTIVE ARM OF THE STABILITY AND GROWTH PACT’;

2. The Member State concerned may request the Commission to redact sensitive or confidential information the disclosure of which would jeopardise public interests of that Member State. In such a case, the Commission shall liaise with the European Parliament and the Council regarding how the redacted information can be made available to them in a confidential manner in accordance with the applicable rules.’;

(6) Article 5 is deleted;

(4) Articles 4 and 5 are deleted;

Fines

1. If the Council, acting under Article 126(8) TFEU, decides that a Member State has not taken effective action to correct its excessive deficit, the Commission shall, within 20 days of that decision, recommend that the Council, by a further decision, impose a fine, amounting to up to 0,02 % of the latest estimate of the previous year’s GDP of that Member State. The fine shall be paid every six months until the Council assesses that the Member State concerned has taken effective action in response to the decision issued under Article 126(9) TFEU.

1. If the Council, acting under Article 126(8) TFEU, decides that a Member State has not taken effective action to correct its excessive deficit, the Commission shall, within 20 days of that decision, recommend that the Council, by a further decision, impose a fine, amounting to up to 0,02 % of the latest estimate of the previous year’s GDP of that Member State. The fine shall be paid every six months until the Council assesses that the Member State concerned has taken effective action in response to the decision issued under Article 126(7) TFEU.

2. A decision imposing a fine shall be deemed to have been adopted by the Council unless it decides by a qualified majority to reject the Commission’s recommendation within 10 days of the Commission’s adoption thereof.

2. The decision imposing a fine shall be deemed to be adopted by the Council unless it decides by a qualified majority to reject the Commission’s recommendation within 10 days of the Commission’s adoption thereof.

Review and reports on the application of this Regulation

1. By 31 December 2030 and every five years thereafter, the Commission shall publish a report on the application of this Regulation, accompanied, where appropriate, by a proposal to amend this Regulation. ▌

1. By XXX, and every 5 years thereafter, the Commission shall submit to the European Parliament and to the Council a report on the application of this Regulation accompanied, where appropriate, by a proposal to amend this Regulation. The Commission shall make that report public.

2. The report referred to in paragraph 1 shall review:

The report referred to in the first subparagraph shall review:

‘1. Irrespective▌ ofMember theStates othershall taskshave setin outplace independent fiscal institutions as referred to in ArticleArticles 5, 6 and 8a of Directive 2011/85/EU, Member States2011/85/EU shalland haveArticles in11, place15 oneand or23 moreof independentRegulation bodies(EU) for:2024/1263.’;

(a) providing the opinion referred to in Article 11(2) and the assessment referred to in Article 23 of Regulation (EU) 2024/1263;

▌

(b) monitoring compliance with the national numerical fiscal rules referred to in Articles 5 and 8a of Directive 2011/85/EU’;

(b) paragraph 2 is deleted;

For Member States subject to an excessive deficit procedure under Regulation (EC) No 1467/97, the draft budgetary plan shall explain how the draft budget for the forthcoming year ensures compliance with the corrective net expenditure path.

‘Article 10

‘Article 10 Reporting requirements for Member States subject to an excessive deficit procedure

Reporting requirements for Member States in excessive deficit procedure

1. Where the Council adopts recommendations addressed to the Member State concerned in accordance with Article 126(7) TFEU, that Member State shall submit follow-up reports on effective action to the Council and the Commission. Those reports shall be submitted every six months starting from the submission of the first report on effective action referred to in Article 3(5) of Regulation (EC) No 1467/97, and until the Council abrogates the decision on the existence of an excessive deficit. The content of those follow-up reports on effective action shall be as laid down in Article 3(5) of Regulation (EC) No 1467/97.

(1)2. Where the Council makesgives recommendationsnotice to the Member State concerned in accordance with Article 126(7)126(9) TFEU, followingthat theMember submissionState ofshall thesubmit firstfollow-up reportreports on effective action takento referredthe toCouncil inand Articlethe 3(5)Commission. ofThose Regulationreports (EC)shall Nobe 1467/97,submitted theevery Memberquarter Statestarting shallfrom submitthe follow-upsubmission reportsof the first report on effective action referred to thein CouncilArticle and5(1a) theof CommissionRegulation on(EC) aNo six-monthly1467/97, basisand until the Council abrogates the decision on the existence of an excessive deficit. The content of those follow-up reports on effective action shall be as specifiedlaid down in Article 3(5)5(1a) of Regulation (EC) No 1467/97.

(2) Where the Council gives notice to the Member State concerned in accordance with Article 126(9) TFEU, following the submission of the3. firstThe reportreports on actioneffective takenaction referred to in Article 5(1a) of Regulation (EC) No 1467/97, the Member State shall submit follow-up reports onparagraphs effective1 actionand on2 aof quarterlythis basisArticle untilmay thebe Councilincluded abrogatesin the decisionannual onprogress thereport existenceas ofdefined anin excessiveArticle deficit.2, Thepoint content(7), of those follow-up reports on effective action shallRegulation be(EU) as2024/1263, specifiedand in Article 5(1a)the ofdraft Regulationbudgetary (EC)plan, Nowhere 1467/97.possible.

Review and reports on the application of this Regulation

1. By 31 December 2030 and every five years thereafter, the Commission shall publish a report on the application of this Regulation, accompanied, where appropriate, by a proposal to amend this Regulation. ▌

(1) By XXX, and every five years thereafter, the Commission shall submit to the European Parliament and to the Council a report on the application of this Regulation, accompanied, where appropriate, by a proposal to amend this Regulation. The Commission shall make that report public.

2. The report referred to in paragraph 1 shall review:

The report referred to in the first subparagraph shall review: