In accordance with Regulation (EU) No 1295/2013 of the European Parliament and of the Council establishing the Creative Europe Programme (2014 to 2020), the Commission presents a mid-term evaluation report on the programme based on an external and independent evaluation.

The programme is established for the period from 1 January 2014 to 31 December 2020.

As a reminder, Creative Europe comprises three strands: (i) MEDIA, which fosters the creation of audiovisual content and its access to European and global audiences, through all distribution channels; (ii) the Culture sub-programme covering culture sector initiatives, such as those promoting cross border cooperation, platforms, networking, and literary translation; (iii) a cross-sectoral strand , addressing all cultural and creative sectors, which includes a Guarantee Facility, supporting transnational policy cooperation.

This report covers all the programme's strands and the whole programming period.

Main findings and recommendations:

Relevance : the report states Creative Europe has addressed that key challenges of the cultural and creative sectors, namely fragmented markets, global competition and digital disruption as well as access to finance.

MEDIA has enhanced the cross-border circulation of European films and audiovisual productions and has adapted to new market trends, including through the promotion of European works online. However, the report states that greater collaboration across the value chain and across borders would help professionals work together in response to the digital shift and globalisation. The Commission will report on the way in which the programme is reaping the opportunities offered by the digital transformation , from the creation of high value content to new distribution channels. The Culture sub-programme invests in culture to stimulate job creation and economic growth in regions, and the schemes under Creative Europe continue to be relevant to the objective of preserving cultural heritage in Europe. The Commission will assess whether small operators have access to financial support that matches the ambitions of growing outside their national markets. Under the Cross-sectoral strand , the strong market response to the launch the Guarantee in 2016, with three guarantee agreements signed in January 2017, shows the relevance of this instrument to the needs of the market. A top-up of EUR 60 million (from the European Fund for Strategic Investment), equivalent to 50% of the total budget, will be provided in 2017.

Coherence: whilst the Creative Europe programme complements other EU funding programmes, notably Erasmus+, and Horizon 2020 , further efforts will be made to strengthen the coherence of Creative Europe with EU policy objectives such as the European Agenda for Culture and the Digital Single Market strategy by "mainstreaming" said policy objectives in the programme. In order to strengthen coherence with international and national funding sources the Commission will share more information with sector bodies from Member States to foster alignment with Creative Europe.

Effectiveness: Creative Europe has made an important contribution towards the EU2020 employment objective and the priorities of the current Commission: from 2014 to 2016, Creative Europe channelled EUR 544 million in funding to 2,580 entities in the cultural and creative sectors. It generated an estimated 3,000 jobs over the period. The evaluation shows that innovation and experimentation may be more effectively supported to boost innovative forms of collaboration and cross-over projects between creative sectors (e.g. film and fashion, architecture and virtual reality) to take advantage of the digital shift.

Efficiency: the report notes that considering the huge size of the audiovisual and cultural sectors at European level, the budget of Creative Europe is not sufficient to bring about a major impact at European scale. The efficiency of most of the schemes has improved or remained stable. The success rate declined from one programming period to another, reflecting the fact that the schemes are insufficiently funded compared to the potential interest they generate; a large number of good applications are rejected.

The evaluation pointed to the need to develop a comprehensive performance monitoring framework and the Commission states that it will address the challenges associated with the current monitoring framework.

Sustainability: the sustainability of the results lies primarily in the continuation of partnerships started under Creative Europe and the predecessor programmes. Under both MEDIA and Culture, collaboration between project partners is continued in some form beyond the projects’ lifecycle. The Commission will:

organise conferences and showcase events to disseminate results; consider a new award criterion to develop a plan of project outputs.

EU added value: Creative Europe has delivered EU added value, in particular by focusing on transnational cooperation while building on national support programmes. Thanks to MEDIA support, a significant number of European works have been watched beyond their national borders, thereby contributing to promoting the diversity of the European culture.

Under the Cross-sectoral strand , the Guarantee Facility is expected to have a leverage effect of 6, which is a very effective way of increasing access to finance. From an initial budget of EUR 121 million, over EUR 700 million in loans are expected to be passed on to SMEs and cultural operators across Europe To capitalise on the existing partnerships and networks, the Commission will monitor the development of new partnerships .

Corrigendum to Regulation (EU) No 1295/2013 of the European Parliament and of the Council of 11 December 2013 establishing the Creative Europe Programme (2014 to 2020) and repealing Decisions No 1718/2006/EC, No 1855/2006/EC and No 1041/2009/EC

(Official Journal of the European Union L 347 of 20 December 2013) Article 24(6): for: ‘6. By way of derogation from Article 130(2) of the Financial Regulation, and in duly justified cases, the Commission may consider costs directly linked to the implementation of the supported actions and activities as eligible even if they are incurred by the beneficiary before the submission of the grant application.', read: ‘6. In accordance with Article 130(1) of the Financial Regulation, and in duly justified cases, the Commission may consider costs directly linked to the implementation of the supported actions and activities as eligible even if they are incurred by the beneficiary before the submission of the grant application.'

The European Parliament adopted by 650 votes for, 32 against and 10 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and Council on establishing the programme, "Creative Europe".

The Parliament adopted its position at first reading following the ordinary legislative procedure. The amendments adopted at plenary are the result of a compromise negotiated between the European Parliament and the Council.

General objectives of the programme : the programme aims:

to safeguard, develop and promote European cultural and linguistic diversity, and to promote Europe's cultural heritage ; to strengthen the competitiveness of the European cultural and creative sectors, particularly that of the audiovisual sector . Specific objectives : the specific objectives shall be: tosupport the capacity of the European cultural and creative sectors to operate transnationally and internationally; to promote and enhance the transnational circulation of European cultural and creative works and the mobility of cultural and creative operators , in particular artists (especially female and young ones), as well as to reach wider and under-represented audiences ; to strengthen the financial capacity of SMEs, micro, small and medium organisations in the cultural and creative sectors, so as to assure geographic coverage as well as a balanced sectoral representation ; to favour policy development, innovation, creativity, audience development as well as new business models, managed by the support of transnational policy cooperation .

European added value : the European added value aspect of the programme was underlined so that the following elements would be taken into consideration:

the transnational character of the actions; the development and promotion of transnational cooperation between cultural and creative actors, including artists, audiovisual professionals, cultural and creative organisations and audiovisual sector operators; the economies of scale and critical mass which Union support fosters; ensuring that proper account is taken of the conditions obtaining in the European cultural and creative sectors, in particular the situation in low-production-capacity Member States and/or EU regions with a restricted geographical and/or linguistic area.

Structure of the programme : the programme shall consist of three main sections:

a. a MEDIA programme;

b. a Culture programme;

c. a Cross-sectoral strand.

Logos and visibility : the Commission must assure the visibility of the programme by the use of specific logos for each sub-programme such as the MEDIA logo presented in the programme annex.

Access to the programme : the programme shall foster cultural diversity at international level in line with the 2005 UNESCO Convention and be open to the participation of:

the Member States; acceding countries, candidate countries and potential candidate countries, in accordance with the general conditions outlined in the text; European Free Trade Association countries which are members of the European Economic Area (EEA); the Swiss Confederation; countries of the European Neighbourhood area.

A number of these countries, however, would be excluded from the MEDIA Guarantee Facility foreseen by the programme.

Cooperations are also foreseen with UNESCO, the Council of Europe, the OECD andWIPO.

- MEDIA sub-programme : overall, MEDIA shall reinforce:

the development of a comprehensive range of training measures promoting the acquisition and improvement of new skills and competences by audiovisual professionals, knowledge-sharing and networking initiatives, including the integration of digital technologies; the development of European audiovisual projects, notably films and television programmes, such as fiction, children's and animated films, documentaries and short films, as well as interactive works, notably video games ; measures to support the activities of European audiovisual production companies; measures to help European co-producers and international partners to provide indirect support to audiovisual works; the establisment of systems of support for the distribution of non-national European films through cinema distribution platforms and all other platforms, notably the subtitling, subtitling, dubbing and audio-description of audiovisual works; measures to facilitate circulation of European films worldwide; initiatives to promote eclectic European audiovisual works, including short films , such as festivals and other promotional events ; activities to promote film literacy, including for younger audiences.

- Culture sub-programme : generally, the accent was placed on transnational measures favouring:

the training of cultural and creative actors including adaptation to digital technologies and innovative strategies; the strengthening of the European organisations of the cultural and creative sectors.

Being notably support for festivals and tangible and intangible cultural heritage.

- a Cross-sectoral strand and Guarantee Facility : the Guarantee Facility shall provide improved access to financing for SMEs and organisations active in the cultural and creative sectors.

This facility shall operate as a self-standing instrument and shall be set up and managed in accordance with the titles of the Financial Regulation, in line with the principles established by the annex of the future regulation.

The Commission shall provide a set of clear and precise parameters to the European Investment Fund (EIF). The annual allocation to the EIF and the eligibility and selection criteria for financial intermediaries shall be included in the annual work programme.

Other provisions are included under the cross-sectoral strand including the financial support of the European Audiovisual Observatory as well as the "Creative Europe" offices.

This strand also includes carrying out a feasibility study , to be carried out by 30 June 2014, exploring the possibility of collecting and analysing data in the cultural and creative sectors, other than the audiovisual sector.

Performance indicators : both quantitative and qualitative indicators specific to each programme would be applied (particularly in terms of participation in the programme).

Financial envelope : in accordance with the overall agreement on the financial framework, the financial envelope for the implementation of the Framework Programme has been set at EUR 1.463 billion .

It shall be distributed as follows:

at least 56% for the MEDIA sub-programme; at least 31% for the Culture sub-programme; 13% maximum for the cross-sectoral strand, including at least 4% for transnational cooperation measures and the financing of the "Creative Europe" offices.

Reporting and evaluation : the Commission shall ensure that the Framework Programme is evaluated regularly, externally and independently: a mid-term evaluation report should be presented by 31 December 2017 as well as a final evaluation of the Framework Programme no later than 30 June 2022. In the context the Guarantee Facility should be particularly evaluated.

Delegated acts : it is intended to give the Commission power to adopt acts in accordance with Article 290 of the TFEU in respect of the adaptation of the quantitative and qualitative indicators for the evaluation of the Framework Programme.

The Committee on Culture and Education adopted the report by Silvia COSTA (S&D, IT) on the proposal for a regulation of the European Parliament and of the Council on establishing the Creative Europe Programme.

The committee recommended that the European Parliament’s position adopted in first reading, following the ordinary legislative procedure, should amend the Commission proposal as follows:

A Framework Programme consisting of two independent programmes : Members consider that the Creative Europe programme should be established as a Framework Programme, consisting of two independent programmes, ie. a Culture programme and a MEDIA programme , and one cross-sectoral strand, each programme having its own specific priorities objectives and evaluation criteria.

They state that it is essential to ensure that this framework takes account of the specific nature of the cultural and creative sectors, in particular the audiovisual sector, as well as their particular needs, through tailor-made approaches within two independent programmes.

Definitions and scope : technical provisions are included to the scope of the Framework programme:

- as regards the cultural and creative sectors, the programme shall include in particular: architecture, archives , libraries and museums , artistic crafts, tangible and intangible cultural heritage , design, festivals, music, literature , performing arts, publishing, radio and visual arts;

- as regards the audiovisual sector, the programme shall cover films, including documentaries, fiction films, children's and animated films, television, video games and multimedia.

Cultural and creative operators shall also cover SMEs as defined in Commission Recommendation 2003/361/EC of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises, which are active in the cultural and creative sectors

General objectives of the Framework Programme : Members amend some of the general objectives of the programme by insisting on the European added value of projects based on the promotion of dialogue and intercultural exchanges and on the European cultural diversity or on the innovative nature of the projects.

The Framework Programme shall set up a coherent support structure for the different cultural and creative sectors, consisting of a grants system complemented by a financial instrument .

Against this background, Members highlight the following general objectives:

to safeguard, develop and promote European cultural and linguistic diversity and to safeguard and enhance Europe's cultural heritage , as well as to develop a sense of European identity among European citizens; to build up and strengthen the capacity of Europe’s cultural and creative sectors, with a view to promoting smart, sustainable and inclusive growth, so as to help them to adapt to industrial and economic changes , as well as to support the competitiveness of the European audiovisual industry.

Specific objectives : the following aspects are stressed in the report:

to reinforce the capacity of the European cultural and creative sectors to operate transnationally and internationally and to meet new challenges, such as digitisation ; to promote and enhance the transnational circulation of European cultural and creative works and the mobility of cultural and creative operators in the above-mentioned sectors, in particular artists (especially female and young ones), as well as to reach wider and new audiences and improve access to cultural and creative works in the Union and beyond, in particular for youth, members of minorities, disadvantaged groups and disabled persons ; to strengthen the financial capacity of the cultural and creative sectors and of cultural and creative operators, in particular SMEs , and to ensure equality between women and men entrepreneurs ; to support transnational policy and artistic cooperation in the cultural and creative sectors regarding policy development, innovation , creativity, audience development and new business models.

to reinforce the capacity of the European cultural and creative sectors to operate transnationally and internationally and to meet new challenges, such as digitisation ; to promote and enhance the transnational circulation of European cultural and creative works and the mobility of cultural and creative operators in the above-mentioned sectors, in particular artists (especially female and young ones), as well as to reach wider and new audiences and improve access to cultural and creative works in the Union and beyond, in particular for youth, members of minorities, disadvantaged groups and disabled persons ; to strengthen the financial capacity of the cultural and creative sectors and of cultural and creative operators, in particular SMEs , and to ensure equality between women and men entrepreneurs ; to support transnational policy and artistic cooperation in the cultural and creative sectors regarding policy development, innovation , creativity, audience development and new business models.

(1) Cross sectoral strand and guarantee facility : the Guarantee Facility shall be established as an experimental project and shall be complementary to the grants allocated through the Framework Programme. It shall enable the cultural and creative sectors at large to grow. It shall be opened to cultural and creative SMEs and shall be a self-standing debt instrument providing guarantees for projects in the cultural and creative sectors through leverage opportunities for financial intermediaries. The target for the volume of financial guarantees in the framework of the Guarantee Facility for 2020 shall be EUR 1 billion worth of loans .

Members also clarify provisions on: (i) the operating procedures of the mechanism (indirect access through the EIF); (ii) its scope (only SMEs and organisations working in the cultural sector may benefit); (iii) selection criteria; (iv) control mechanisms.

In the framework of this strand, Members propose to provide financing for the following:

a feasibility study, to be carried out by 30 June 2014, exploring the possibility of collecting and analysing data in the cultural and creative sectors, other than the audiovisual sector ; training for professionals of the cultural and creative sectors in order to enhance their skills in the cultural, media and digital fields; increasing collaboration between sectors which have hitherto had little or no experience of collaboration; the participation of the Union in the European Audiovisual Observatory; Creative Europe Desk network (countries participating in the Framework Programme shall establish Creative Europe Desks in accordance with their respective regulations, internal requirements and arrangements).

(2) Culture Programme : the Culture programme shall provide support for: (i) transnational cooperation projects ; (ii) the promotion of digitial platforms; (iii) literary translations (such as pieces of fiction, novels, plays, poetry, comic strips, etc.) and translations of works related to arts; (iv) an improved structured network; (v) a better cooperation between operators.

It is stressed that the Culture programme should support in particular the non-profit-making projects .

(3) MEDIA Programme : overall, MEDIA shall facilitate the acquisition and improvement of new skills and competences by audiovisual professionals , including the integration of digital technologies. The programme shall support measures to support the activities of European audiovisual production companies, in particular of independent companies, with a view to facilitating European and international co-productions of audiovisual works .

Other measures aim to: (i) establish systems of support for the distribution of non-national European films through cinema distribution platforms and all other platforms, including video on demand and mobile platforms, and for international sales activities; (ii) promote the subtitling, surtitling, dubbing and audio-description of audiovisual works; (iii) promote fiction, children's and animated films, documentaries and short films.

Consistency and complementarity : particular attention has also been drawn to the consistency and the complementarity of the proposed programme with other relevant EU funding sources, such as the ESF, the EU Programme for Social Change and Innovation, the ERDF etc.

Performance results and dissemination : Members propose that both quantitative and qualitative indicators, specific to each programme are used for the monitoring of the Framework Programme. These indicators have been clarified.

Access to the Framework programme : the MEDIA Programme should be open to the same number of countries than the Culture Programme, by smoothing the participation conditions.

Logos and visibility : concerned about undermining the visibility of the programme and especially the MEDIA programme, the logo should be clearly identified. Members call on the Commission to ensure the visibility of the Framework Programme through the use of logos , which will be specific to each of the programmes respectively. The use of these logos (presented in the Annex to the proposal) shall be established in the Commission.

Annual work programme and delegated acts : Members consider that in order to ensure optimal monitoring and evaluation of the Framework Programme, the Commission shall be empowered to adopt delegated acts. In order to amend and supplement certain non-essential elements of this Regulation, the power to adopt acts in accordance with Article 290 of the TFEU should be delegated to the Commission in respect of:

the adoption of the annual work programmes; the adaptation of the quantitative and qualitative indicators for the evaluation of the Framework Programme.

Cooperation : the Union shall, in liaison with the Member States, take the necessary steps to ensure proper cooperation in the culture and creative sectors with the third countries (former Media Mundus programme), multilateral and regional organisations and entities, including, but not limited to European financial institutions, international financial institutions, United Nations agencies, funds and programmes, private foundations and non-Union donors.

Financial envelope : the report points out that the financial envelope specified in the legislative proposal constitutes only an indication to the legislative authority and cannot be fixed until agreement is reached on the proposal for a regulation laying down the multiannual financial framework for the years 2014-2020. It reiterates that sufficient additional resources are needed in the next MFF in order to enable the Union to fulfil its existing policy priorities and the new tasks provided for in the Treaty of Lisbon. Members point out that even with an increase in the level of resources for the next MFF of at least 5% compared to the 2013 level only a limited contribution can be made to the achievement of the Union’s agreed objectives and commitments and the principle of Union solidarity.

Members propose an indicative breakdown of the amounts (in percentages) allocated by type of action. The budgetary allocation between the MEDIA and Culture programmes and the Cross-sectoral Strand shall be as follows:

at least 55% for the MEDIA programme; at least 30% for the Culture programme; a maximum of 15% for the Cross-sectoral Strand, with at least 4% being allocated for the transnational cooperation measures and for the Creative Europe Desk network.

Reports and evaluation : the Commission shall present a mid-term evaluation report to the European Parliament and the Council by 31 December 2017. The Member States shall submit to the Commission no later than 30 September 2017 a report on the implementation and impact of the Framework Programme within their territory. A final evaluation of the Framework Programme shall be submitted by the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions no later than 30 June 2022.

The Council reached a partial general approach on the proposal for a Regulation establishing the "Creative Europe" Programme for the period 2014-2020 and bringing together the three current independent programmes Culture, MEDIA and MEDIA MUNDUS. The "Creative Europe" programme has a two-fold objective: (i) promoting cultural diversity and (ii) enhancing the competitiveness of the cultural, audiovisual and creative sectors.

The Commission proposes a budget of EUR 1.8 billion, of which 15% would be allocated to the cross-sectoral strand, 30% to the culture strand and 55% to the MEDIA strand.

Guarantee Facility of MEDIA’s successor : the aim of this second partial approach (for the aim of the first approach, please refer to the summary of the Council debate of 10/05/2012) is to reach agreement on the provisions relating to the Guarantee Facility , aimed at improving access to financing for SMEs operating in the cultural and creative sectors.

The main outstanding issues concern:

the funding of commercial cultural projects; indicators; implementing provisions.

The budget proposed by the Commission for the Facility is EUR 200 million .

The Cypriot Presidency has focused its work on the provisions regarding the Guarantee Facility, introducing a number of changes to the proposal in order to ensure geographical balance among Member States and a balanced sectoral representation, which is of great importance especially for smaller Member States and Member States with restricted linguistic areas. The structure and the tasks of the Guarantee Facility have also been specified , as well as the roles of all the players involved.

A new provision was also introduced specifying that the annual work programme for the Facility should include three sets of criteria and the annual allocation to the European Investment Fund . The Commission opposes this change , arguing that the level of detail requested is excessive and will unnecessarily complicate implementation.

Reporting obligations : the Commission’s reporting obligations are enhanced by introducing mid-term and final reports that the Commission will have to establish and submit to both the EP and the Council. The Commission considers that the reinforced reporting obligation will increase the administrative burden and the cost of implementing the Programme.

Lastly, it should be noted that the rapporteur of the European Parliament's Culture and Education Committee (Silvia COSTA – S&D, IT) presented her draft report on 8 October 2012. The vote in the committee is scheduled to take place on 18 December 2012.

In public deliberation, the Council reached a partial general approach on the proposal for a regulation establishing the "Creative Europe" programme for the period 2014-2020, and bringing together the three current independent programmes: CULTURE, MEDIA and MEDIA Mundus. The text presented to the Council, on which a large majority of delegations have already indicated their broad agreement, is intended as a Presidency compromise text .

Main issues discussed : as this regulation is part of the Multiannual Financial Framework (2014 - 2020) currently under discussion, the partial general approach does not include the provisions with budgetary implications.

- Structure of the programme : delegations in general welcomed the structure of the Programme as proposed by the Commission, which is a “one-stop-shop” for cultural and creative sectors, provided that the cultural part and MEDIA-related part will be treated as separate strands, each having its own priorities, measures and budget. They endorsed in principle the general and specific objectives of the Programme as well as the priorities and support measures of individual strands. Delegations also supported the fact that the Programme will be potentially open to a broader number of participants such as the countries of the European Neighbourhood area.

During the examination delegations nevertheless expressed a degree of concern regarding the lack of detail in the Commission proposal . While they accepted the Commission’s argument that the programme needs to be flexible in order to accommodate unpredictable changes in the future, delegations asked for the text to be clearer and for the Member States to have a bigger role in the implementation of the programme.

In response to these concerns, the Presidency has made a number of adjustments to the text. The main changes can be summarised as follows:

- Intrinsic value of culture : a recurrent concern of delegations has been to ensure a better balance between economic objectives such as competitiveness and growth, and the cultural objectives of promoting cultural and linguistic diversity. In order to find this balance, a recital which underlines the dual nature of culture (artistic and economic) has been added, Article 5a (1) on European added value (former Article 3) has been modified to feature both the intrinsic and economic value of culture, and a new recital on a shared cultural area has been inserted;

- Audience development : delegations took the view that when trying to reach new audiences, the Programme should pay particular attention to children and young people, as well as to groups which do not usually enjoy access to culture for social, professional, health or other reasons. Therefore a particular focus on those target groups has been added among the specific objectives of the Programme (Article 5 (b)) and an indicator on measuring the number of projects addressed to them has been introduced in Article 14 (Culture Strand);

- National points of contacts (Article 8a): a separate article on the Creative Europe Desks has been added in order to emphasise the essential role of those structures during the implementation of the programme at national level;

- Funding of commercial cultural projects (Article 10 (2)): in response to delegations’ wish to emphasise that the projects to be funded under the Culture Strand should be primarily non-profit a new paragraph has been added to Article 10. As a final element of the compromise on this point, recital 23 has been modified to underline the importance of non-profit making organisations and projects in the cultural field : the Commission underlined that it would not be fair to exclude from funding every profitmaking cultural or creative organisation, since this would discourage them not only from seeking additional sources of financing but also from trying to be successful;

- Indicators (Article 14): while delegations agreed with the need to measure the impact of the Programme in order to produce reliable and comparative data, they felt that indicators as proposed by the Commission did not include any qualitative indicators and did not correspond sufficiently to the objectives against which they are to measure progress, such as for example the objective to strengthen circulation of European films beyond national borders. A number of amendments were therefore made in Article 14 (1). In response to a proposal to introduce an additional qualitative indicator for the general objectives which would measure the cultural diversity of the selected projects , a new paragraph 1a in Article 14 has been added according to which indicators others than the ones listed in Article 14 (1) should be adopted by the Commission using the examination procedure;

- Implementing provisions (Articles 17 and 18): in response to delegations wishes to strike a balance between a slim and flexible text and the need to ensure the appropriate involvement of Member States, a number of adjustments to the comitology provisions have been made. Firstly, the advisory procedure as proposed by the Commission has been changed to a mixed procedure : the examination procedure would apply to annual work programmes, while the advisory one would apply to the general guidelines. Secondly, the text specifies that the Programme committee may meet in specific configurations, which means that Member States can send different experts depending on the topic of the Committee’s agenda. Finally, a new provision on communication has been introduced according to which the Commission will provide ex-post information to countries participating in the Programme on selection decisions (Article 15 (- 1));

Financial provision : Ministers were also invited to have an exchange of views on the new Cultural and Creative Sectors Facility proposed in the programme, on the basis of a discussion paper prepared by the Presidency. This loan instrument was designed to facilitate access to finance by cultural and creative enterprises, 80 % of which are small and medium-sized enterprises. The facility should also be seen in the context of the general focus on the contribution of small and medium- sized enterprises to jobs and growth. By encouraging financial institutions to build up their business in relation to the cultural and creative sectors and thereby facilitating access to finance for these sectors, the proposed new Cultural and Creative Sectors Facility is intended to strengthen the sectors’ financial capacity and competitiveness, thereby opening new opportunities for growth and employment. It is also envisaged that the Cultural and Creative Sectors Facility will lessen small and medium-sized enterprises’ dependence on public subsidies in some cases, while opening up new revenue streams in others. Management of the Cultural and Creative Sectors Facility is envisaged to be mandated to a third party financial institution, such as the European Investment Fund (EIF), due to the nature of the expertise required for the running of such a facility.

Member states were generally favourable to this new instrument, considering it a step in the right direction but several member states pointed out that most SMEs in the cultural and creative sectors would need help in applying for financing and should have equal access to the Facility . A number of Member States expressed concerns that this new lending Facility would replace grants and be economically rather than culturally orientated. Some Member States were of the view that the Facility could reduce small and medium-sized enterprises dependence on public subsidies in some cases, while opening up new sources of revenue in others.

Many Member States underlined the need for clear criteria, as well as the importance of a geographical balance regarding access to loans . Several ministers called for complementarity between the Facility and national and European subsidies. The Commission underlined that the involvement of the European Investment Fund was a guarantee for the financial sector. It also indicated that the Facility would not replace grants and that 55% of grants in this sector already go to SMS with less than 10 employees.

PURPOSE: to present the main objectives of the Creative Europe Programme - A new framework programme for the cultural and creative sectors (2014-2020).

CONTENT: "Creative Europe", the new framework programme for the cultural and creative sectors (CCS) for the 2014-2020 Multi-Annual Financial Framework (MFF), will bring together the current Culture, MEDIA and MEDIA Mundus programmes under a common framework and create an entirely new Facility to improve access to finance.

By specifically targeting the needs of the cultural and creative sectors aiming to operate beyond national borders, and with a strong link to the promotion of cultural and linguistic diversity, the programme will complement other European Union (EU) programmes such as structural fund support for investment in the cultural and creative sectors, heritage restoration, cultural infrastructure and services, digitisation funds for cultural heritage and the enlargement and external relations instruments.

For the 2014-2020 MFF , the Commission proposes a significant increase in the budget devoted to the cultural and creative sectors, a total of € 1.801 billion (current prices), a 37% increase on current spending levels. This increase is fully in line with the rationale and priorities of the Europe 2020 strategy.

The new Programme will be a simple, easily recognisable and accessible gateway for European cultural and creative professionals, regardless of their artistic discipline, and it will offer scope for international activities within and outside of the EU.

In preparing the proposal, the Commission has consulted widely with interested parties. It has also drawn on the interim evaluations of the current programmes, and independent studies.

Lessons learned for the future

Culture Programme 2007-2013 : drawing lessons from current experience, the objectives proposed for the future Framework Programme will be adapted to the real needs of project promoters, including cultural and creative SMEs. They will also promote the job and growth potential of these sectors, while continuing to have a strong link to the promotion of cultural and linguistic diversity. Regarding the different actions under the programme, numerous improvements and simplifications will be introduced. The large number of calls and categories, which increase complexity and reduce transparency, will be reduced from 9 to 4. Another simplification will be the discontinuation of operating grants, which have proven insufficiently result-oriented and complicated for applicants and beneficiaries. All future actions will use project grants, which are simpler and foster a longer-term approach.

MEDIA 2007 Programme (2007-2013) and MEDIA Mundus Programme (2011-2013) : a number of simplification opportunities have been identified both on a strategic and operational level. These will include: a focus on structuring actions with a maximum systemic impact; creation of a financial facility to progressively replace direct grants where possible; increasing the leverage of EU funds; streamlining of the international dimension previously covered in the separate MEDIA Mundus Programme within the single legal basis; a crosscutting value chain approach which supports a number of film projects with high commercial and circulation potential ("champions") throughout the value chain, from training to distribution; transversal projects covering several segments and players of the value chain; and support to sales agents with broad market reach and a global market approach.

A new Financial Facility : one serious problem facing the creative and cultural sectors which needs to be addressed, but cannot be tackled through grants, is the difficulty encountered by small cultural and creative enterprises and organisations in accessing finance. Small under-capitalised enterprises find it therefore very difficult to finance their activities and to grow and maintain their competitiveness. It is estimated that there is a funding gap of some €2.8 billion to €4.8 billion in terms of bank loans for these SMEs. The problem is more acute in some Member States than in others: well-developed expertise on the part of financial institutions is only to be found in a limited number of countries.

The programme will therefore set up for the first time a financial Facility for the cultural and creative sectors. It will be complementary to other EU facilities under the Structural Funds or

the Competitiveness and Innovation Programme, which has a transversal approach and very limited impact on extending activities in sectors in which intermediaries (financial

institutions) have little activity, such as the cultural and creative sectors. This Facility will provide strong European added value and enable valuable networking and peer learning.

Key actions and priorities of the Programme : a single framework programme will be the most coherent and cost-effective solution for supporting the cultural and creative sectors and to help promote their important contribution at EU level. It offers the best basis to focus attention on the challenges currently facing these sectors and to target EU support on those measures that provide EU added value by helping them optimise their potential for economic growth, job creation and social inclusion.

The design of the programme recognises the complexity and heterogeneity of the cultural and creative sectors, which include publically funded organisations, non-profit organisations as well as commercial enterprises.

This is why the option of a framework programme has been chosen, comprised of three Strands:

an Cross-sectoral Strand addressed to all cultural and creative sectors; a Culture Strand addressed to the cultural and creative sectors; a MEDIA Strand addressed to the audiovisual sector.

The indicative budgetary allocation will be 15% for the Cross-sectoral Strand, 30% for the Culture Strand and 55% for the MEDIA Strand.

Expected impact of the programme : the impact sought for the programme will be to strengthen the adaptation of the cultural and creative sectors to globalisation and the digital shift. Overall, the more targeted focus on transnational circulation of works should lead to higher level of circulation of works, more trade within the internal market, more international trade and increased revenues for the sector.

In the Culture Strand , this will include a clearer focus on capacity-building and transnational circulation, including international touring, new European platforms with a large-scale structuring effect, and more strategic packages of support for literary translation for publishing houses including promotional support.

The MEDIA Strand will increase resources for distribution, including increased and more focused funding for sales agents to allow for the emergence of stronger sales agents with higher buying and selling power on the international market. Strengthening support to Europe-based international co-production funds will boost co-production between European and non-European producers, increasing the number and improving the quality of the works, and thereby contributing to further opening international markets.

By improving access to finance for the cultural and creative sectors through improved investment and investor readiness, the new financial Facility will increase the capacity of these sectors to attract private finance, strengthen their financial capacity and the commercial potential of works, thereby strengthening their competitiveness and opening up new opportunities for growth and employment.

Management mode : the vast majority of grants under the Culture and MEDIA Strands will continue to be managed through the Executive Agency for Education, Audiovisual and Culture (EACEA) through calls for proposals. As confirmed by various evaluations this has proved to be a costeffective management mode for cross-border projects. Some aspects of the programme will be managed directly by the Commission, notably the special actions, including prizes, cooperation with international institutions including international audiovisual co-production funds, and the funding for the European Capitals of Culture and the European Heritage Label. Management of the cultural and creative sector financial Facility will be mandated to a third party financial institution, most likely the European Investment Fund (EIF) due to the nature of the expertise required for the running of such a facility.

A considerable number of simplifications were already introduced for the management of the current Culture and MEDIA programmes. However further improvements will be introduced in Creative Europe. Greater use will be made in general of flat rates, more grant decisions and framework partnership agreements, electronic application and reporting for all actions, and an electronic portal to reduce paperwork for applicants and beneficiaries. Another significant simplification measure will be the merging of the two information networks to reap economies of scale, greater transparency for the public by having only one EU entry point, and a higher quality service.

PURPOSE: to establish the Creative Europe Programme 2014-2020, following on from the Culture , MEDIA and Media Mundus .

PROPOSED ACT: Regulation of the European Parliament and of the Council.

BACKGROUND: the Commission adopted a proposal for the next multi-annual financial framework for the period 2014-2020 on a budget for delivering the Europe 2020 strategy. In its proposal, the Commission decided that support for the cultural and creative sectors (CCS) should remain an essential element of the next financial package and proposed a single "Creative Europe" framework programme, bringing together the current Culture, MEDIA and MEDIA Mundus programmes, and including a new financial facility to improve access to finance for small- and medium-sized enterprises (SME) and organisations in the cultural and creative sectors.

This approach recognises the important contribution these sectors make to jobs and growth, representing 4.5% of total European GDP in 2008 and accounting for some 3.8% of the workforce. Beyond their direct contribution to GDP, they trigger spill-over in other sectors of the economy such as tourism and fuelling content for ICT.

In a broader sense creativity will play an essential role in modern education. It will drive innovation, entrepreneurship, as well as smart and sustainable growth and contribute to social inclusion.

IMPACT ASSESSMENT: three impact assessments have contributed to this proposal, namely one on the continuation of the current Culture programme, a joint impact assessment on the current MEDIA and MEDIA Mundus programmes, and a separate impact assessment on the creation of a financial facility for the cultural and creative sectors.

After assessing several options, both conclude that a merger of Culture, MEDIA, MEDIA Mundus and a new financial facility within a single framework programme would have advantages compared to all other options considered in terms of achieving the necessary objectives, efficiency, cost-effectiveness (result per Euro spent), and coherence.

LEGAL BASIS: the first indent of Article 167(5) and Article 173(3) and Article 166(4) of the Treaty on the Functioning of the European Union (TFEU).

CONTENT: with this Decision, the Commission intends to establish the Creative Europe Programme for support to the European cultural and creative sectors for the period from 1 January 2014 to 31 December 2020.

European added value : the Programme shall only support those actions and activities presenting a potential European added value and contributing to the achievement of the objectives of the Europe 2020 Strategy and its flagship initiatives.

European added value shall be ensured in particular through:

the transnational character of its activities and their impact, which will complement national, international and other Union programmes; the economies of scale and critical mass which Union support fosters creating a leverage effect for additional funds; transnational cooperation stimulating more comprehensive, rapid and effective responses to global challenges and creating long-term systemic effects on the sectors; ensuring a more level playing field in the European cultural and creative sectors by taking account of low production capacity countries and/or countries or regions with a restricted geographical and linguistic area.

Structure of the Programme : the Programme shall consist of the following strands:

an Cross-sectoral Strand addressed to all cultural and creative sectors; a Culture Strand addressed to the cultural and creative sectors; a MEDIA Strand addressed to the audiovisual sector.

The indicative budgetary allocation will be 15% for the Cross-sectoral Strand, 30% for the Culture Strand and 55% for the MEDIA Strand.

Objectives of the Programme : i ts general objectives will be (i) to safeguard and promote the European cultural and linguistic diversity and (ii) to strengthen the competitiveness of the sector; thereby it will contribute to the EU 2020 strategy and its flagship initiatives.

The specific objectives are as follows:

support the capacity of the European cultural and creative sectors to operate transnationally including by strengthening the relations and networks between operators; promote the transnational circulation of cultural and creative works and operators and reach new audiences in Europe and beyond; strengthen the financial capacity of the cultural and creative sectors; support transnational policy cooperation in order to foster policy development, innovation, audience building and new business models.

Each strand will specify its own priorities and measures , and will prioritise projects with a systemic effect on the sectors for example through support for new business models, network building and exchange of know-how in particular on the digital shift and globalisation of these sectors. Another important and new objective will be raising interest in European works through the support of audience building activities.

All the priorities by sub-heading are detailed in in the proposal and in the Annex.

The international dimension of Creative Europe will be integrated through the following measures:

possibility for participation of acceding countries, candidate countries and potential candidates benefiting from a pre-accession strategy, EEA, countries of the European neighbourhood area and Switzerland; possibility for bilateral cooperation with other third countries and international organisations; specific actions targeted at international professionals (integration of MEDIA Mundus).

Implementation : a considerable number of simplifications were already introduced for the management of the current Culture and MEDIA programmes. However further improvements will be introduced in Creative Europe. Greater use will be made in general of flat rates, more grant decisions and framework partnership agreements , electronic application and reporting for all actions, and an electronic portal to reduce paperwork for applicants and beneficiaries.

The number of instruments and calls for proposals managed by the Executive Agency for Education, Audiovisual and Culture (EACEA) under the Culture Strand will be simplified by reducing them from 9 to 4 main categories. Operating grants, which have been confusing for applicants and beneficiaries, will be discontinued in favour of project grants .

The financial facility will lead to improved use of EU funds through the financial leverage it will generate and its re-use of revolving funds, which will offer the Commission greater efficiency than traditional grants to beneficiaries. Another significant simplification measure will be the merging of the two information networks to reap economies of scale, greater transparency for the public by having only one EU entry point, the Creative Europe desks .

The establishment of a single Programme Committee would also contribute to a more costeffective and lean management of the programme, not only via savings in implementation costs but also through more effectiveness resulting from stronger synergies among relevant policies and sectors.

Performance results and dissemination : the programme includes a monitoring and evaluation process. The results of the monitoring and evaluation process shall be used when implementing the Programme. The evaluation shall have the right scope and will be carried out in a sufficiently timely manner to feed into the decision making process. In addition to the regular monitoring the Commission shall establish an external evaluation report no later than end-2017 in order to assess the effectiveness in achieving the objectives and the efficiency of the Programme and its European added value in view of a decision on the renewal, modification or suspension of the Programme.

The Commission, in cooperation with the Member States, shall ensure overall consistency and complementarity with: (a) relevant EU policies, in particular those in the fields of education, employment, health, research and innovation, enterprise, tourism, justice and development; (b) other relevant EU funding sources.