1. A T H E N A 1 E UROPEAN U NION ATHENA ATHENA 2007 2007 E UROPEAN U NION ATHENA ATHENA 2007 2007 Council decision 2007/384/CFSP of 14 May 2007 ( OJ 13/06/2007 L152/14 )

2. A T H E N A 2 Financing of EU Military Operations “ATHENA”

3. A T H E N A 3 Treaty on the European Union – No distinction between civilian and military operations as regards tasks Art 17(2): « humanitarian and rescue tasks, peacekeeping tasks and tasks of combat forces in crisis management, including peacemaking ». – But military operations may not be financed from the budget of the European Communities – In principle, their operational expenditure are financed from contributions by Member States based on the GNI scale, except where the Council decides otherwise Art 28(3): « Operational expenditure …shall also be charged to the budget of the European Communities, except for such expenditure arising from operations having military or defence implications. … it shall be charged to the Member States in accordance with the gross national product scale, unless the Council acting unanimously decides otherwise. »

4. A T H E N A 4ATHENA « A mechanism to administer the financing of the common costs of operations having military or defence implications » Based on the experience of CONCORDIA and ARTEMIS (2003)Based on the experience of CONCORDIA and ARTEMIS (2003) set up by Council Decision 2004/197/CFSP on 1 March 2004set up by Council Decision 2004/197/CFSP on 1 March 2004 amended by 2 Council Decisions at end 2004 / in early 2005amended by 2 Council Decisions at end 2004 / in early 2005 amended again by a Council Decision adopted on 12 Feb 2007amended again by a Council Decision adopted on 12 Feb 2007 NB: what is new in 2007 is shown in italics

5. A T H E N A 5 ATHENA: Overview –A permanent mechanism, ready ahead of any EU military operation, endowed with legal capacity (sign contracts!) 1) Financing limited to certain common costs, based on GNI key 2) Pre-financing of « Nation Borne Costs », managed in common but billed to States based on their consumption –Annual budget includes provisional appropriations to finance the preparatory and early phases of operations –Management bodies: Special CommitteeSpecial Committee The AdministratorThe Administrator The Operation Commander(s)The Operation Commander(s) The AccountantThe Accountant College of auditorsCollege of auditors

6. A T H E N A 6 Role: a budget committee −Approves the budgets, the accounts, the financial rules, the final destination of equipment at the end of each operation −May extend common costs for a given operation Composition – Member States contributing to the financing of each operation – The Commission attends without taking part in votes –Contributing Third States may attend without voting Management bodies: The Special Committee

7. A T H E N A 7 Management bodies: the Administrator –Permanent executive authority –Authorising officer where there is no Operation Commander (before he is officially appointed, after he has left office, and for the EU supporting action to AMIS) –Ensures that ATHENA’s rules are complied with and may appoint an auditor at any time –May adopt any measures which he deems necessary to implement the expenditure financed through ATHENA –Contact point of national administrations and international organisations on financial questions

8. A T H E N A 8 Management bodies: the Operation Commander(s) −Authorising officer(s) for the operation, during term in office −In this capacity, implement expenditure financed or pre- financed in common and keep funds provided by ATHENA −Prepare draft budget(s) for the operation −Provide quaterly budget implementation reports −Provide ATHENA’s accounting officer with the information necessary for the accounts by 31 March of year n+1

9. A T H E N A 9 Management bodies: ATHENA’s accounting officer − Keeps the accounts at the central level − Prepares the annual accounts at the central level → OpCdr must provide information by 31 March each year →annual accounts require cut-off at end of each year − Lays down the accounting rules and methods and the chart of accounts − Responsible for payments and recovery of amounts (contributions, Nation Borne Costs) at the central level − Mid 2007: ATHENA has its own accounting software →help in accounting and reporting

10. A T H E N A 10 ATHENA’s auditors College of auditors -6 members appointed by Special Committee for 3 years from national audit bodies -work for ATHENA only when necessary An internal auditor must be appointed by the OpCdr The administrator may appoint auditors at any time Access to all premises and information

11. A T H E N A 11 Sound Financial Management – ATHENA has its own Financial Rules (based on the EC Directive on Public Procurement and thus similar to national legislations) – Mid 2007: ATHENA will have its own accounting software – Reporting to the Special Committee by OpCdr(s) and Administrator: – every month when spending on reference amount, before a budget is approved – every 3 months when Title for the operation introduced in budget – Accounts: – information provided by each OpCdr by 31 March each year – consolidation by ATHENA’s accountant by 30 April –Auditing: –Each OpCdr must audit its operation according to own rules (NATO if Berlin +, Framework Nation) and must appoint an internal auditor –ATHENA’s College of Auditors –Administrator and Special Committee may trigger audits –Approval of accounts and discharge by Special Committee every year

12. A T H E N A 12 Which operations? « A mechanism to administer the financing of the common costs of operations having military or defence implications » 2 sub-categories (new in 2007): −« classical » military operations, i.e. with EU HQs −« EU military supporting actions », in support of a Third State or a third organisation, without EU HQs (cf. EU supporting action to AMIS, military component)

13. A T H E N A 13 « Classical » military operations: PREPARATORY PHASE Before the operation commander is officially appointed – Common costs: -Costs of transport and accommodation necessary for exploratory missions and preparations (including fact-finding missions and reconnaissance) by military forces -MEDEVAC for those personnel – Authorizing officer: Administrator, (may delegate to future OHQ) – Funds available: General Part of annual budget (2007 : 480 000 euros) – Small stock of CIS equipment available (bought in 2006)

14. A T H E N A 14 « Classical » military operations: ACTIVE PHASE (I) – Start: when the OpCdr is appointed (usually by Joint Action) – Common costs, in all cases: - Mostly Headquarters (OHQ, FHQ, Component Headquarters): deployment, barracks and lodging, CIS, admin, public info, representation and hospitality, Locally Hired Personnel - Forces as a whole: infrastructure, Medevac - Reimbursements to/from NATO or other organisations (UN) - If the Council so decides: Transport and lodging of forces, multinational HQs below FHQ, acquisition of information - Authorizing officer: the OpCdr - OpCdr receives funds from ATHENA

15. A T H E N A 15 « Classical » military operations: other common costs The Special Committee may decide that any item other than transport and lodging of forces and multinational HQs below the FHQ is financed in common for one operationThe Special Committee may decide that any item other than transport and lodging of forces and multinational HQs below the FHQ is financed in common for one operation New in 2007! When requested by the Operation Commander and approved by the Special Committee, other items are financed in common: Essential additional equipmentEssential additional equipment Medical services (Roles 1, 2 and 3 facilities in theatre)Medical services (Roles 1, 2 and 3 facilities in theatre) Acquisition of information (satellite images, theatre level intelligence, reconnaissance and surveillance, including AGSR, human intelligence)Acquisition of information (satellite images, theatre level intelligence, reconnaissance and surveillance, including AGSR, human intelligence) Other critical theatre-level capabilities (demining, CBRN, fuel storage and supply facilities, storage and destruction of arms collected within the area of operationsOther critical theatre-level capabilities (demining, CBRN, fuel storage and supply facilities, storage and destruction of arms collected within the area of operations

16. A T H E N A 16 « Classical » military operations: strategic airlift New in 2007! −During the next two years −Financing in common of incremental costs −For EU Member States −When providing strategic airlift for short notice deployment of Battle Groups in accordance with the Battle Group concept. −The Council will determine the flat rates, below actual costs, applicable to the payment or reimbursement of these costs. −« The present arrangement will cease after two years, unless the Council agrees to extend it. »

17. A T H E N A 17 Nation Borne Costs Which costs? →Decision by the Special Committee for each operation (So far: Messing Laundry, Lodging, Utilities, POL, Maps Medical care) ALTHEA: for FHQ, 3 million euros a yearALTHEA: for FHQ, 3 million euros a year CONGO: for HQs and forces, 16 million eurosCONGO: for HQs and forces, 16 million eurosAdvantages: –Management in common of procurement –Prefinancing by ATHENA Drawbacks: –NBCs are billed to States based on their consumption, reimbursement due within 30 days from billing →Administrative burden for personnel in theatre Financial burden for Troop Contributing Nations

18. A T H E N A 18 « Classical » military operations: ACTIVE PHASE (II) Funds and cash flow – When Joint Action is approved by the Council Reference Amount in Joint ActionReference Amount in Joint Action Call for contributions: 30% of Reference Amount unless Council or Special Committee sets a higher percentage (70% for EUFOR RD CONGO)Call for contributions: 30% of Reference Amount unless Council or Special Committee sets a higher percentage (70% for EUFOR RD CONGO) Payable within 30 days from callPayable within 30 days from call – Later period (no date set): Budget proposed by administrator with assistance of OpCdrBudget proposed by administrator with assistance of OpCdr Approved by Special Committee acting unanimouslyApproved by Special Committee acting unanimously Call for contributions:Call for contributions: – equal to the budget minus first call based on reference amount – payable in 30 days or 2 installments if operation lasts more than 6 months

19. A T H E N A 19 The Early Financing scheme Contributions are called when Joint Action is adopted and are payable within 30 days →Problem in funding the early phase of operations Solution: provisional appropriations in ATHENA’s budget (11 million euros provided by 18 Member States) Rapid Response: these appropriations can be usedthese appropriations can be used Member States other than the 18 pay their contributions within 5 daysMember States other than the 18 pay their contributions within 5 days Other operations: Each of the 18 may use its deposit to pay their contribution to the operationEach of the 18 may use its deposit to pay their contribution to the operation 50% of the 11 million euros can be used with the assent of the 18 MS50% of the 11 million euros can be used with the assent of the 18 MS

20. A T H E N A 20 « Classical » military operations: Winding up phase − Equipment purchased for an operation: final destination proposed by OpCdr, decided by Special Committeefinal destination proposed by OpCdr, decided by Special Committee CONGO: storage by Germany (OHQ) and France (FHQ) during half-year where they make Battle Groups availableCONGO: storage by Germany (OHQ) and France (FHQ) during half-year where they make Battle Groups available Equipment stored after the operation in CONGO will be available for the next operation(s)Equipment stored after the operation in CONGO will be available for the next operation(s) −Settling of invoices and drawing up of accounts must be completed even after repatriation of forces and termination of OpCdr’s term in office →importance of rear parties

21. A T H E N A 21 Military supporting actions – Only experience so far: EU military supporting action to AMIS, military componentEU military supporting action to AMIS, military component New in 2007! −Common costs: to be decided on a case-by-case basis by the Council, by reference to common costs for « classical » operationsto be decided on a case-by-case basis by the Council, by reference to common costs for « classical » operations − The authority appointed to command the operation will play the role of « operation commander » for ATHENA (notably that of authorising officer during term in office) −All other provisions apply as for « classical » military operations (including NBCs and Early Financing)

22. A T H E N A 22EXERCISES – Same financing as for operations, except that more limited: – Only headquarters, no forces – No capital acquisitions – No preparatory phase – CME 04 – CMX 05 – CME 06 – CME 07: OpCentre / Sweden

23. A T H E N A 23 ACTUAL OPERATIONS – ALTHEA – since 2 December 2004 – common costs: around 33 million euros spent per year – «Nation Borne Costs »: around 3.5 millions per year – budget for common costs: 33.8 million euros for 2007 – EU Supporting Action to AMIS – 29 June 2005, extended until end June 2007 at present – around 1 million euros spent per year – EUSEC « Chain of payment » project – civilian operation financed from EC budget – start up phase by ATHENA (15.11. 2005-15.02.2006) – 0.9 million euros provided by 6 Member States, 0.6 million spent – EUFOR RD CONGO – Common costs: 19.2 mio euros in budget, 14 mio spent – « Nation Borne Costs »: about 16 million euros spent

24. A T H E N A 24 CHALLENGES AHEAD Advanced parties / rear parties –Advanced parties should be deployed sufficiently early –Rear parties should remain in theatre until all financial issues settled –Manning should be sufficient –Should include « spending sections » (J1, J4, J6) together with J8 in same teams Organisation of the chain of command –One single multinational team or HQ on each site, which includes « spending sections » (J1, J4, J6) together with J8 – Division of labour should be in line with concepts approved by Military Committee and ATHENA’s Financial Rules

25. A T H E N A 25 CHALLENGES AHEAD –Common costs: examine adaptation to operational needs –Tactical airlift, in a context where reinforcements could be called at short notice (cf. EUFOR RD CONGO) –CIMIC: increase EUFOR’s acceptability by local population –Framework contracts –organise access for OpCentre to Member States’ contracts –Training –Train military personnel to ATHENA for future operations –J8s and « spending sections » (J1s, J4s, J6s) –General training ahead of future operations –Ad hoc training when a given operation starts ATHENA needs cooperation and support from Member States, on a voluntary basis

26. E UROPEAN U NION ATHENA ATHENA E UROPEAN U NION ATHENA ATHENA QUESTIONS ?