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REPORT (2023/2180(DEC))

On discharge in respect of the implementation of the budget of the Key Digital Technologies Joint Undertaking (now the Chips Joint Undertaking) for the financial year 2022

A-9-2024-0101

Committee on Budgetary Control · Rapporteur: Michal Wiezik

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Parliament grants discharge to the Executive Director of the Key Digital Technologies Joint Undertaking (now the Chips Joint Undertaking) for the 2022 budget and approves the closure of its 2022 accounts. Its resolution notes the accounts present fairly the Joint Undertaking's financial position and that underlying transactions are legal and regular. It calls on the Joint Undertaking to disclose members' contributions at programme level, to set a time-scheduled action plan for closing old projects, and to improve risk-based monitoring and the reinforced monitoring tool. It notes the transformation into the Chips Joint Undertaking and the increase in Union contributions from EUR 1,8 billion to EUR 4,2 billion.

Committee position. The Committee on Budgetary Control proposes that Parliament grant discharge to the Executive Director for the 2022 budget, approve the closure of the accounts, and adopt observations calling for better disclosure of members' contributions, a time-scheduled action plan for old projects, and improved risk-based monitoring.

Key points

  1. Parliament grants the Executive Director discharge for the implementation of the Joint Undertaking's 2022 budget and approves the closure of its 2022 accounts.
  2. The Joint Undertaking, located in Brussels, was set up for the period ending 31 December 2031 and replaced the ECSEL Joint Undertaking; in July 2023 it became the Chips Joint Undertaking.
  3. Its founding members are the Union represented by the Commission, the Participating States and three industry associations.
  4. Union contributions to the KDT Joint Undertaking will increase from EUR 1,8 billion to EUR 4,2 billion, with EUR 2,7 billion from Horizon Europe and EUR 1,5 billion from Digital Europe.
  5. The Joint Undertaking should disclose in its annual accounts members' contributions at programme level, including legal contribution targets, contributions received and legal commitments.
  6. The Court found the 2022 accounts present fairly the financial position and that underlying transactions are legal and regular.
  7. In 2022 total available appropriations reached EUR 261,4 million for commitment and EUR 222,2 million for payment; budget implementation reached 100 % for commitment and 55 % for payment appropriations.
  8. The Joint Undertaking did not disclose important information on members' contributions at programme level, including Participating States' contributions, and is called on to address this.
  9. Most private members' in-kind contributions remain to be validated (EUR 1 172,5 million); at end-2022 the maximum Union operational contribution of EUR 1 169,7 million for Horizon 2020 was fully committed, with around EUR 139,2 million still to be paid.
  10. The Court estimated Participating States signed contractual commitments of EUR 1 106,2 million (95 % of target) and declared financial contributions of EUR 495,3 million.
  11. The Joint Undertaking should establish a time-scheduled action plan for finalising projects approved under previous Multiannual Financial Frameworks.
  12. It should develop internal guidance on risk-based monitoring and use of the COMPASS risk management module, and ensure reinforced monitoring actions have specific control actions and follow-up deadlines.

Who is affected

  • The Key Digital Technologies Joint Undertaking (now the Chips Joint Undertaking) and its Executive Director, who receives discharge and must address the observations.
  • The Joint Undertaking's members: the Union represented by the Commission, the Participating States and three industry associations.
  • Beneficiaries of Horizon 2020 and Horizon Europe projects, affected by payment delays and ex-post audits.

Figures and deadlines

  • Union contributions to the KDT Joint Undertaking will increase from EUR 1,8 billion to EUR 4,2 billion.
  • EUR 2,7 billion to be funded from the Horizon Europe programme and EUR 1,5 billion from the Digital Europe programme.
  • Total available appropriations in 2022: EUR 261,4 million for commitment and EUR 222,2 million for payment.
  • Budget implementation reached 100 % for commitment appropriations and 55 % for payment appropriations.
  • Private members' in-kind contributions remaining to be validated: EUR 1 172,5 million.
  • Maximum Union operational contribution for Horizon 2020: EUR 1 169,7 million, of which around EUR 139,2 million (or 11,9 %) remains to be paid.
  • Estimated private members' potential final in-kind contributions for Horizon 2020: EUR 1 579 million or 97,6 % of the minimum target of EUR 1 617.5 million.
  • Participating States signed contractual commitments of EUR 1 106,2 million (or 95 %) and declared financial contributions of EUR 495,3 million.

Legal basis: Article 319 of the Treaty on the Functioning of the European Union.