THE COUNCIL OF THE EUROPEAN UNION,Having regard to the Treaty on the Functioning of the European Union,
Having regard to Council Regulation (EU) No 407/2010 of 11 May 2010 establishing a European financial stabilisation mechanism 1 , and in particular Article 3(2) thereof,
Having regard to the proposal from the European Commission,
Whereas:(1) Greece has requested new financial assistance from the European Stability Mechanism ("ESM") and there is an agreement in principle to provide the requested assistance.
(2) However, Greece needs bridge financing until such assistance can be put into place, in order to preserve the integrity of the euro area, preserve financial stability and avoid further default on its repayment obligations. In view of the severe economic and financial disturbance caused by exceptional circumstances beyond the control of the Government, Greece officially requested some urgent financial assistance from the Union on 15 July 2015 with a view to safeguarding financial stability in Greece, the euro area and the Union. The assistance to be granted to Greece by the ESM will be used to repay the loan received by Greece under the European Financial Stability Mechanism ("EFSM").
(3) The draft economic and financial adjustment programme (the "Programme") submitted by Greece to the Commission and to the Council aims to ensure the adoption of a set of reforms needed to improve the sustaina-bility of public finances and the regulatory environment.
(4) The assessment by the Commission, in liaison with the European Central Bank ("ECB"), is that Greece needs financing of a total amount of EUR 7 160 million over the month of July 2015. The detailed financial terms should be laid down in a Loan Facility Agreement.
(5) The Union financial assistance should be managed by the Commission.
(6) Greece submitted to the Commission and to the Council the Programme aiming to ensure the adoption of a set of reforms needed to improve the sustainability of public finances and the regulatory environment. On 15 July 2015, an agreement was reached at services level between the Government and the Commission in respect of the Programme, to be laid down in a Memorandum of Understanding on Specific Economic Policy Conditionality (the "Memorandum of Understanding").
(7) The Commission should verify at regular intervals that the economic policy conditions attached to the assistance are fulfilled, through missions and regular reporting by the Greek authorities.
(8) The assistance should be provided with a view to supporting the successful implementation of the Programme.
(9) The euro area Member States have communicated their commitment to reimburse jointly and promptly through a dedicated arrangement each non euro area Member State for the amount that that non euro area Member State has paid in own resources corresponding to the use of the general budget of the Union in cases of losses stemming from a Union financial assistance to a euro area Member State under Regulation (EU) No 407/2010. Appropriate arrangements will also be put in place so as to ensure the absence of over-compensation of non euro area Member States, when instruments to protect the general budget of the Union, including the recovery of debt, where necessary by offsetting amounts receivable and payments over time, are activated.
(10) The EFSM loan is guaranteed by the general budget of the Union. In case of default under this loan, the Commission can call additional funds in excess of its assets taking into account any surplus cash balances, to service the Union's debt. Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council 2 (the "Financial Regulation") applicable to the general budget of the Union and its detailed rules foresee instruments to protect the Union budget including the recovery of debt, where necessary by offsetting amounts receivable and payments over time. The Commission will apply these instruments,
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