Alignment with the EU economic governance framework and further simplification of that framework

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Commission proposal1st reading – European Parliament1st reading – Council of the EUTrilogues (interinstitutional negotiations)2nd readingConciliationAdoption

Provisional agreement reached, awaiting formal adoption by Parliament and Council.

Last active 15 Jul 2026

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What this bill does

In plain terms: what it changes and who it affects.

This proposal updates and simplifies euro-area budget surveillance and sanctions rules to match the EU economic governance reform adopted in 2024.

Who it affects

It affects euro-area Member States and their public finance authorities, especially governments preparing budgets or subject to excessive deficit procedures.

Core of the proposal

Replaces obsolete references with medium-term fiscal-structural plans, net expenditure paths and corrective net expenditure paths.
Deletes economic partnership programmes and several reporting duties considered unnecessary or duplicative.
Limits euro-area fiscal fines to up to 0.02% of the previous year’s GDP, payable every six months.
Requires draft budgetary plans to explain compliance with the Council-set net expenditure path.

Key provisions

Takes effect: The Regulation enters into force on the twentieth day following its publication in the Official Journal of the European Union.

Articles changed · 30 across 2 laws

Regulation (EU) No 1173/2011 (32011R1173)
- art. 1: replaces Article 1(1)
- art. 2: deletes points 1 and 3; replaces point 2
- art. 3: replaces first paragraph
- art. 4: deletes Article 4
- art. 5: deletes Article 5
- art. 6: replaces Article 6
- art. 7: deletes Article 7
- art. 8: deletes paragraph 4
- art. 9: replaces Article 9
- art. 10: deletes Article 10
- art. 11: deletes Article 11
- art. 12: replaces paragraph 1
- art. 13: replaces Article 13
Regulation (EU) No 473/2013 (32013R0473)
- art. 1: replaces Article 1(1)(a)-(c); deletes point (e)
- art. 2: replaces definitions, adds points (e) and (f), deletes second subparagraph, replaces paragraph 2
- art. 3: replaces Article 3
- art. 4: deletes paragraph 1; replaces paragraph 4
- art. 5: replaces paragraph 1; deletes paragraph 2
- art. 6: replaces Article 6
- art. 7: replaces paragraphs 2 and 4
- art. 8: replaces paragraph 1
- art. 9: deletes Article 9
- art. 10: replaces Article 10
- art. 11: deletes Article 11
- art. 12: deletes Article 12
- art. 13: replaces Article 13
- art. 14: deletes Article 14
- art. 15: replaces paragraph 1(b); deletes paragraph 1(d) and paragraph 2
- art. 16: replaces Article 16
- art. 17: deletes Article 17

Latest update

15 Jul 2026

The most recent development in this bill's progress.

Trilogues (interinstitutional negotiations) → Trilogues (interinstitutional negotiations)

Documents

1 recent

SourcesOEILEUR-LexEU Law Tracker