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8. 8. 202211:36

The Czech Presidency leads negotiations on revision of the Regulation on the Recovery and Resilience Facility

Despite the progress in the field of economic recovery of the EU after the COVID-19 pandemic, the EU is facing new challenges during this year, especially related to the impacts of Russian aggression against Ukraine. In this regard one of the key European priorities has become a reduction of EU dependency on fossil fuel imports from the Russian Federation through the so-called REPowerEU plan. The emphasis on energy security has also been reflected in the priorities of the Czech Presidency of the Council of the EU (CZ PRES).

On 8 March 2022 the European Commission (EC) presented the REPowerEU plan. The aim of this plan is to achieve energy savings, diversify energy supplies to the EU and support a usage of energy from renewable sources. According to the plan, the dependence on Russian gas should be eliminated before 2030. Subsequently, on 18 May 2022 the EC issued a package of documents related to the REPowerEU plan, which also included a proposal for revision of the regulation establishing the Recovery and Resilience Facility (RRF), which is currently being negotiated under the CZ PRES.

From the RRF are provided financial sources to EU Member States for a purpose of implementing reforms and investments included in approved Recovery and Resilience Plans (RRPs). In order to be able to draw financial support from the RRF, the Czech Republic submitted its RRP to the EC, entitled National Recovery Plan (Národní plán obnovy), which was approved by the Council of the EU in September last year.

The aim of the revision of the RRF Regulation is to enable to EU Member States to finance further reforms and investments directly contributing to the objectives of REPowerEU. For that reason, the updated RRPs should include a separate chapter dedicated to measures that contribute to the fulfilment of the objectives of the REPowerEU plan.

The current negotiations on a revision of the RRF regulation are led by the CZ PRES within the Working Party of Financial Counsellors under the Economic and Financial Affairs Council (ECOFIN). The RRF regulation is administrated on the national level by the Office of the Government – Section for European Affairs, while the negotiations are held by the Office of the Government in cooperation with the Permanent Representation of the Czech Republic in Brussels and also with the Ministry of Finance.

Currently, the debates on the proposed revision of the RRF regulation are mainly focused on discussing variants of the source of funding and on finding relevant allocation key for the distribution of additional funds among the EU Member States. In terms of executing presidency role at the Council of the EU, the Czech Republic actively strives for the lowest possible administrative burden for individual EU Member States and the greatest possible degree of flexibility in drawing financial support in order to quickly implement the REPowerEU measures. If the negotiations go smoothly, approval of the General Approach of the Council of the EU is expected for the ECOFIN meeting in October 2022. Subsequently, negotiations on the text of regulation between the EC, CZ PRES (representing the Council of the EU) and European Parliament will take a place as trialogue.