### articles 5 , 6 , 7 , 8 and 12 shall not apply to the activities of an investment firm or a third country entity or a local firm that is a member of a trading venue or of a market in a third country , whose legal and supervisory framework has been declared equivalent pursuant to paragraph 2 , when it deals as principal in a financial instrument , whether traded on or outside a trading venue , in either or both of the following capacities : ### articles 5 to 8 and 12 shall not apply to the activities of an investment firm or a third country entity or a local firm that is a member of a trading venue or of a market in a third country , whose legal and supervisory framework has been declared equivalent pursuant to paragraph 2 , when it holds itself out on a continuous basis as being willing to deal as principal in a financial instrument , whether traded on or outside a trading venue or as a systemic internaliser , in any one of the following capacities :


### articles 5 , 6 , 7 , 8 and 12 shall not apply to the activities of an investment firm or a third country entity or a local firm that is a member of a trading venue or of a market in a third country , whose legal and supervisory framework has been declared equivalent pursuant to paragraph 2 , when it deals as principal in a financial instrument , whether traded on or outside a trading venue , in either or both of the following capacities : ### articles 5 , 6 , 7 , 8 and 12 and any restrictions or requirements imposed under articles 16 , 17 , 18 or 24 shall not apply to the activities of an investment firm , or a third country entity or a local firm that is a member of a trading venue or of a market in a third country , whose legal and supervisory framework has been declared equivalent pursuant to paragraph 2 , when it deals as principal in a financial instrument , whether traded on or outside a trading venue , in either or both of the following capacities :


### a relevant notification threshold is a percentage that equals 0 . 2% of the value of the issued share capital of the company concerned and each 0 . 1% above that . ### a relevant notification threshold is a percentage that equals 1% of the value of the issued share capital of the company concerned and each 0 , 1% above that .


### the competent authorities shall conclude cooperation agreements on exchange of information with the competent authorities of third countries only where the information disclosed is subject to guarantees of professional secrecy which are at least equivalent to those set out in article 29 . such exchange of information must be intended for the performance of the tasks of those competent authorities . ### the competent authorities shall not enter into cooperation arrangements with third countries which result in obligations for member states other than those concerning the provision of information . cooperation arrangements on exchange of information shall be entered into only where the information disclosed is subject to guarantees of professional secrecy which are at least equivalent to those set out in article 29 . such exchange of information must be intended for the performance of the tasks of those competent authorities .


### the natural or legal person has an arrangement with a third party under which that third party has confirmed that the share or sovereign debt instrument has been located and reserved for lending for the natural or legal person so that settlement can be effected when it is due . ### the natural or legal person has entered into an arrangement with a third party under which the third party has confirmed that the share or debt instrument will be available for lending to the person or for settling the short sale on the date on which settlement is due .


### articles 5 , 6 , 7 , 8 and 12 shall not apply to the activities of an investment firm or a third country entity or a local firm that is a member of a trading venue or of a market in a third country , whose legal and supervisory framework has been declared equivalent pursuant to paragraph 2 , when it deals as principal in a financial instrument , whether traded on or outside a trading venue , in either or both of the following capacities : ### articles 5 to 8 and 12 shall not apply to the activities of an investment firm or a third country entity or a local firm that is a member of a trading venue or of a market in a third country , whose legal and supervisory framework has been declared equivalent pursuant to paragraph 2 , when it deals as principal in any financial instrument including equities , options , derivatives , sovereign debt and corporate debt , whether traded on or outside a trading venue or as a systemic internaliser , in either or both of the following capacities :


### fishing authorisations referred to in article 4 for vessels using bottom trawls or bottom - set gillnets shall expire at the latest two years after the entry into force of this regulation . after that date , fishing authorisations targeting deep - sea species with those gears shall neither be issued nor renewed . ### fishing authorisations for vessels using bottom trawls or bottom - set gillnets below 400 metres shall expire at the latest two years after the entry into force of this regulation . after that date , fishing authorisations allowing fishing operations below 400 meters with those gears shall neither be issued nor renewed .


### the master of a vessel , or any other person responsible for the vessel ' s operation , shall be required to take on board the scientific observer whom the member state has assigned for his vessel , unless this is not possible for security reasons . the master shall facilitate the discharging of the scientific observer ' s tasks . ### the master of a vessel , or any other person responsible for the vessel ' s operation , shall be required to take on board the scientific observer whom the member state has assigned for his vessel , in line with the level of coverage for the fishing fleet fixed in the national data collection programme , unless this is not possible for security reasons .


### fishing authorisations referred to in article 4 for vessels using bottom trawls or bottom - set gillnets shall expire at the latest two years after the entry into force of this regulation . after that date , fishing authorisations targeting deep - sea species with those gears shall neither be issued nor renewed . ### fishing authorisations for vessels using bottom trawls or bottom - set gillnets bellow 200 meters shall expire at the latest two years after the entry into force of this regulation . after that date , fishing authorisations targeting deep - sea species with those gears shall neither be issued nor renewed .


### any fishing authorisation issued on the basis of an application made in accordance with paragraph 1 shall specify the bottom gear to be used and limit the fishing activities authorised to the area in which the intended fishing activity , as set out in paragraph 1 , and the existing fishing activity , as set out in paragraph 1 , overlap . however , the area of the intended fishing activity can be extended beyond the area of the existing fishing activity if the member state has assessed and documented , based on scientific advice , that such extension would not have significant adverse impacts on vulnerable marine ecosystems . ### any fishing authorisation issued on the basis of an application made in accordance with paragraph 1 shall specify the bottom gear to be used and limit the fishing activities authorised to the ices and cecaf area , subarea , division and subdivision in which the intended fishing activity , as set out in paragraph 1 , and the existing fishing activity , as set out in paragraph 1 , overlap . however , the area of the intended fishing activity can be extended beyond the ices and cecaf area , subarea , division and subdivision of the existing fishing activity if the member state has assessed and documented , based on scientific advice , that such extension would not have significant adverse impacts on vulnerable marine ecosystems .


### fishing opportunities shall be fixed at a rate of exploitation of the deep - sea species concerned that is consistent with maximum sustainable yield . ### fishing opportunities shall be fixed at a rate of exploitation of the deep - sea species concerned that is consistent with maximum sustainable yield , in accordance with article 16 of the [ common fisheries policy regulation ] .


### each application for a fishing authorisation allowing for the catch of deep - sea species whether as target or by - catch species , and for its renewal shall be accompanied by a description of the area where it is intended to conduct fishing activities , the type of gears , the depth range at which the activities will be deployed , and of the individual species targeted . ### each application for a fishing authorisation allowing for the catch of deep - sea species whether as target or by - catch species , and for its renewal shall be accompanied by a description of the area where it is intended to conduct fishing activities , indicating all the ices and cecaf subareas , divisions and subdivisions covered , the type of gears , the depth range at which the activities will be deployed , and of the individual species targeted .


### however , in order to provide fishermen with sufficient time to adjust to the new requirements current fishing authorisations for fishing with bottom trawls and bottom - set gillnets should continue to be valid for a specified period of time . ### fishermen require sufficient time to adjust to the new requirements , and current fishing authorisations for fishing with bottom trawls and bottom - set gillnets should continue to be valid for a specified period of time , minimising the negative consequences for the fleet engaging in this fishing activity .


### vessels targeting deep - sea species with other bottom gear should not extend their range of operation according to their authorisation within union waters , unless expansion can be assessed as not carrying a significant risk of negative impact on vulnerable marine ecosystems . ### vessels fishing deep - sea species in a targeted or accessory manner with bottom gear should not extend their range of operation according to their fishing authorisation within union waters , unless expansion can be assessed as not carrying a significant risk of negative impact on vulnerable marine ecosystems . similarly , wherever their area of activity may be , when finding indices of the presence of vulnerable marine ecosystems , they should avoid these locations in the future , pending whether these indices reflect a proved presence of vulnerable marine ecosystems .


### vessels targeting deep - sea species with other bottom gear should not extend their range of operation according to their authorisation within union waters , unless expansion can be assessed as not carrying a significant risk of negative impact on vulnerable marine ecosystems . ### vessels catching deep - sea species with other bottom gear should not extend their range of operation according to their authorisation within union waters , unless expansion can be assessed as not carrying a significant risk of negative impact on vulnerable marine ecosystems .


### ‘ maximum sustainable yield’ means the maximum catch that may be taken from a fish stock indefinitely . ### ‘ maximum sustainable yield’ means the highest theoretical equilibrium yield that can be continuously taken on average from a stock under average environmental conditions without affecting significantly the reproduction process ;


### special fishing authorisations issued in accordance with regulation no 2347 / 2002 shall remain valid until their replacement by fishing authorisations allowing the catch of deep - sea species issued in accordance with this regulation , but shall in any case no longer be valid after 30 september 2012 . ### special fishing authorisations issued in accordance with regulation no 2347 / 2002 shall remain valid until their replacement by fishing authorisations allowing the catch of deep - sea species issued in accordance with this regulation , but shall in any case no longer be valid after 30 september 2014 .


### where the best scientific information available does not identify exploitation rates corresponding to the precautionary approach to fisheries management due to lack of sufficient data concerning a certain stock or species , no fishing opportunities may be allocated for the fisheries concerned . ### where the best scientific information available does not identify exploitation rates corresponding to the precautionary approach to fisheries management due to lack of sufficient data concerning a certain stock or species , the fishing opportunities for the relevant fishing management period may not be fixed higher than the rates provided within the ices approach for data limited stocks .


### deep - sea fishing with bottom trawls carry the highest risk for vulnerable marine ecosystems among the different gears used and reports the highest rates of undesired catch of deep - sea species . bottom trawls should therefore be permanently prohibited from the targeting of deep - sea species . ### deep - sea fishing with bottom trawls carries the highest risk for vulnerable marine ecosystems among the different gears used .


### moreover , vessels which have to change gear in order to be able to stay in the fishery should be eligible for receiving financial assistance from the european fisheries fund provided that the new gear reduces the impact of fishing on non - commercial species and provided also that the national operational programme allows contributing to such measures . ### moreover , vessels which opt to change gear should be eligible for receiving financial assistance from the european fisheries fund provided that the new gear reduces the impact of fishing on non - commercial species and provided also that the national operational programme allows contributing to such measures .


### bottom - set gillnets are currently restricted in entering deep - sea fisheries by council regulation no 1288 / 2009 establishing transitional technical measures from 1 january 2010 to 30 june 2011 . in view of the high rates of undesired catch when they were deployed unsustainably in deep waters , and in view of the ecological impact of lost and abandoned gear , this gear should also be permanently prohibited from the targeting of deep - sea species . ### bottom - set gillnets are currently restricted in entering deep - sea fisheries by council regulation no 1288 / 2009 establishing transitional technical measures from 1 january 2010 to 30 june 2011 . in view of the high rates of undesired catch when they were deployed unsustainably in deep waters , and in view of the ecological impact of lost and abandoned gear , fisheries management measures should be defined and implemented that will make it possible to minimise the impact of bottom - set gillnets targeting deep - sea species .


### the council , acting in accordance with the treaty , may decide to switch from the fixing of annual fishing opportunities for deep - sea species in terms of both fishing effort limits and catch limits to the fixing of only fishing effort limits for specific fisheries . ### the switching from the fixing of annual fishing opportunities for deep - sea species in terms of both fishing effort limits and catch limits to the fixing of only fishing effort limits for specific fisheries shall be decided in accordance with the treaty .


### fishing activities not targeting deep - sea species but catching deep - sea species as a by - catch , carried out by a union fishing vessel , shall be subject to a fishing authorisation , which shall indicate deep - sea species as by - catch . ### fishing activities carried out in union waters not targeting deep - sea species but catching deep - sea species as a by - catch , shall be subject to a fishing authorisation , which shall indicate deep - sea species as by - catch .


### in addition to the requirements set out in article 6 , each application for a fishing authorisation for targeted deep sea fisheries , as referred to in article 4 , that allows the use of bottom gears in union waters as referred to in article 2 , shall be accompanied by a detailed fishing plan specifying : ### in addition to the requirements set out in article 6 , each application for an authorisation for fishing deep - water stocks that allows for the use of bottom gears in union waters as defined in article 2 , or in waters under neafc jurisdiction as referred to in article 2 , shall :


### any fishing authorisation issued on the basis of an application made in accordance with paragraph 1 shall specify the bottom gear to be used and limit the fishing activities authorised to the area in which the intended fishing activity , as set out in paragraph 1 , and the existing fishing activity , as set out in paragraph 1 , overlap . however , the area of the intended fishing activity can be extended beyond the area of the existing fishing activity if the member state has assessed and documented , based on scientific advice , that such extension would not have significant adverse impacts on vulnerable marine ecosystems . ### any fishing authorisation issued on the basis of an application made in accordance with paragraph 1 shall specify the characteristics , type and dimensions of the bottom gear to be used and limit the fishing activities authorised to the area in which the intended fishing activity , as set out in paragraph 1 , and the existing fishing activity , as set out in paragraph 1 , overlap . however , the area of the intended fishing activity can be extended beyond the area of the existing fishing activity if the member state has assessed and documented , based on best available scientific advice , that such extension would not have significant adverse impacts on vulnerable marine ecosystems . this assessment shall be conducted in accordance with annex iia and the 2008 fao international guidelines for the management of deep - sea fisheries in the high seas and shall be made publicly available .


### the locations of the intended activities targeting deep - sea species in the deep - sea m&#233 ; tier . the location shall be defined by coordinates in accordance with the world geodetic system of 1984 ; ### the locations of the intended activities targeting deep - sea species in the deep - sea m&#233 ; tier . the location shall be defined by coordinates in accordance with the world geodetic system of 1984 and shall include an indication of all the ices and cecaf subareas , divisions and subdivisions covered ;


### ' maximum sustainable yield ' means the maximum catch that may be taken from a fish stock indefinitely . ### ' maximum sustainable yield ' means the highest theoretical equilibrium yield that can be continuously taken on average from a stock under existing average environmental conditions without affecting significantly the reproduction process .


### the locations , if any , of activities in the deep - sea métier during the last three full calendar years . those location shall be defined by coordinates in accordance with the world geodetic system of 1984 and they shall circumscribe the fishing activities as closely as possible . ### limit the authorised fishing activities to existing fishing areas ;


### scientific advice concerning certain fish stocks found in the deep - sea indicates that these stocks are particularly vulnerable to exploitation , and that fishing for these stocks should be limited or reduced as a precautionary measure . fishing opportunities for deep - sea stocks should not go beyond those levels which are scientifically advised as precautionary . in the case of advice being absent for lack of sufficient information about stocks or species , no fishing opportunities should be allocated . ### scientific advice concerning certain fish stocks found in the deep - sea indicates that these stocks are particularly vulnerable to exploitation , and that fishing for these stocks should be limited or reduced as a precautionary measure . fishing opportunities for deep - sea stocks should not go beyond those levels which are scientifically advised as precautionary .


### any fishing authorisation issued on the basis of an application made in accordance with paragraph 1 shall specify the bottom gear to be used and limit the fishing activities authorised to the area in which the intended fishing activity , as set out in paragraph 1 , and the existing fishing activity , as set out in paragraph 1 , overlap . however , the area of the intended fishing activity can be extended beyond the area of the existing fishing activity if the member state has assessed and documented , based on scientific advice , that such extension would not have significant adverse impacts on vulnerable marine ecosystems . ### without prejudice to article 7 , fishing activities that are to take place in waters defined in paragraph 1 but that are defined as new fishing areas in the meaning of article 3 paragraph 2b shall be subject to a fishing authorisation . applications for such authorisations shall include a detailed project for the exploratory fishing activity that follows the neafc guidelines outlined in annex iia . applications will be accepted if it can be shown that the activity described will have no harmful effects on vulnerable marine ecosystems .


### without prejudice to article 7 of regulation 1224 / 2009 , the fishing authorisations referred to in article 4 and of this regulation shall be withdrawn for a duration of at least one year in the following cases : ### without prejudice to article 7 of regulation 1224 / 2009 , the fishing authorisations referred to in article 4 and of this regulation shall be withdrawn , following an assessment and decision by the member state , for a duration of at least one year in the following cases :


### the locations , if any , of activities in the deep - sea métier during the last three full calendar years . those location shall be defined by coordinates in accordance with the world geodetic system of 1984 and they shall circumscribe the fishing activities as closely as possible . ### the locations , if any , of activities in the deep - sea métier during the last three full calendar years . those location shall be defined by coordinates in accordance with the world geodetic system of 1984 and they shall circumscribe the fishing activities as closely as possible and include an indication of all the ices and cecaf subareas , divisions and subdivisions covered .


### the commission adopted the communication ' europe 2020 - a strategy for smart , sustainable and inclusive growth ' in march 2010 . the communication was endorsed by the european council of june 2010 . the europe 2020 strategy responds to the economic crisis and is intended to prepare europe for the next decade . it sets five ambitious objectives on climate and energy , employment , innovation , education and social inclusion to be reached by 2020 and identifies key drivers for growth , which aim at making europe more dynamic and competitive . it also emphasises the importance of reinforcing the growth of the european economy while delivering high levels of employment , a low carbon , resource and energy - efficient economy and social cohesion . ### the commission adopted the communication ' europe 2020 - a strategy for smart , sustainable and inclusive growth ' in march 2010 . the communication was endorsed by the european council of june 2010 . the europe 2020 strategy responds to the economic crisis and is intended to prepare europe for the next decade . it sets five ambitious objectives on climate and energy , employment , innovation , education and social inclusion to be reached by 2020 and identifies key drivers for growth , which aim at making europe more dynamic and competitive . it also emphasises the importance of reinforcing the growth of the european economy while delivering high levels of employment for women and men equally , a low carbon , resource and energy - efficient economy and social cohesion .


### to promote entrepreneurship , including among specific target groups ; ### to promote entrepreneurship , including among specific target groups such as young people , women and marginalised communities ;


### encouraging an entrepreneurial culture and promoting the creation and growth of smes . ### encouraging an entrepreneurial culture and promoting the creation and growth of smes including among specific target groups , such as young people , women and marginalised communities .


### particular attention shall be paid to young entrepreneurs , new and potential entrepreneurs and female entrepreneurs , as well as specific target groups . ### particular attention shall be paid to young entrepreneurs , as well as new and potential entrepreneurs , both female and male , and to specific target groups such as young men and women .


### particular attention shall be paid to young entrepreneurs , new and potential entrepreneurs and female entrepreneurs , as well as specific target groups . ### particular attention shall be paid to young entrepreneurs , female entrepreneurs , entrepreneurs from marginalised communities , new and potential entrepreneurs and as well as specific target groups .


### to improve access to finance for smes in the form of equity and debt ; ### to improve access to finance for smes in the form of equity and debt and to provide information to and raise the awareness of potential beneficiaries including specific groups such as young people , women and marginalized communities ;


### the power to adopt delegated acts referred to in articles 4 and 6 shall be conferred on the commission for an indeterminate period of time from . . ### the power to adopt delegated acts referred to in article 4 shall be conferred on the commission for a period of five years from . the commission shall draw up a report in respect of the delegation of power not later than nine months before the end of the five year period . the delegation of power shall be tacitly extended for periods of an identical duration , unless the european parliament or the council opposes such extension not later than three months before the end of each period .


### the power to adopt delegated acts referred to in articles 4 and 6 shall be conferred on the commission for an indeterminate period of time from . . ### the power to adopt delegated acts referred to in article 4 shall be conferred on the commission for a period of five years from . . the commission shall draw up a report in respect of the delegation of power not later than nine months before the end of the five - year period . the delegation of power shall be tacitly extended for periods of an identical duration unless the european parliament or the council opposes such extension not later than three months before the end of each period .


### pollen , being a natural constituent particular to honey , shall not be considered an ingredient , within the meaning of article 6 of directive 2000 / 13 / ec , of the products defined in annex 1 to this directive ### pollen , being a natural constituent particular to honey , shall not be considered an ingredient , within the meaning of article 6 of directive 2000 / 13 / ec , of the products defined in annex 1 to this directive . however , pollen shall be considered as an ingredient within the meaning of article 2 and article 12 of regulation no . 1829 / 2003


### the delegation of power referred to in articles 4 and 6 may be revoked at any time by the european parliament or by the council . a decision to revoke shall put an end to the delegation of the power specified in that decision . it shall take effect the day following the publication in the official journal of the european union or at a later date specified therein . it shall not affect the validity of the delegated acts already in force . ### the delegation of power referred to in article 4 may be revoked at any time by the european parliament or by the council . a decision to revoke shall put an end to the delegation of the power specified in that decision . it shall take effect the day following the publication of the decision in the official journal of the european union or at a later date specified therein . it shall not affect the validity of any delegated acts already in force .


### member states shall bring into force the laws , regulations and administrative provisions necessary to comply with article 1 , point by [ date ] . they shall forthwith communicate to the commission the text of those provisions . ### member states shall bring into force the laws , regulations and administrative provisions necessary to comply with article 1 , point by [ 12 months after the date of entry into force ] . they shall forthwith communicate to the commission the text of those provisions .


### member states and other project promoters shall carry out environmental assessment of plans and projects in particular as provided in council directives 85 / 337 / eec of 27 june 1985 on the assessment of the effects of certain public and private projects on the environment and 92 / 43 / eec of 21 may 1992 on the conservation of natural habitats and of wild fauna and flora , and directives of the european parliament and of the council : 2000 / 60 / ec of 23 october 2000 establishing a framework for community action in the field of water policy , 2001 / 42 / ec of 27 june 2001 on the assessment of the effects of certain plans and programmes on the environment , and 2009 / 147 / ec of 30 november 2009 on the conservation of wild birds in order to avoid or , when not possible , mitigate or compensate for negative impacts on the environment , such as landscape fragmentation , soil sealing , air and water pollution as well as noise , and to effectively protect biodiversity . ### member states and other project promoters shall carry out environmental assessment of plans and projects in particular as provided in council directives 85 / 337 / eec of 27 june 1985 on the assessment of the effects of certain public and private projects on the environment and 92 / 43 / eec of 21 may 1992 on the conservation of natural habitats and of wild fauna and flora , and directives of the european parliament and of the council : 2000 / 60 / ec of 23 october 2000 establishing a framework for community action in the field of water policy , 2001 / 42 / ec of 27 june 2001 on the assessment of the effects of certain plans and programmes on the environment , and 2009 / 147 / ec of 30 november 2009 on the conservation of wild birds in order to avoid or , when not possible , mitigate or compensate for negative impacts on the environment , such as to landscape fragmentation , reduction of natural habitats , migration barriers , collision of vehicles with animals , soil sealing , air and water pollution as well as noise and to effectively protect biodiversity . new infrastructure programmes and individual projects have to comply with union legislation on environmental protection , noise , water and the protection of flora and fauna .


### – the development of rest areas approximately every 50 kilometres on motorways in order inter alia to provide sufficient parking space for commercial road users with an appropriate level of safety and security ; ### – the development of rest areas approximately every 50 kilometres or less , depending on the demand , on motorways in order to enhance road safety and inter alia to provide sufficient parking space for commercial road users with an appropriate level of safety and security ;


### member states shall prevent , detect and correct irregularities and fraud when executing tasks related to the implementation of the budget . to this end they shall carry out ex ante and ex post controls including , where appropriate , on the spot checks , to ensure that the actions financed from the budget are effectively carried out and implemented correctly , recover funds unduly paid and bring legal proceedings as necessary . member states shall impose effective , dissuasive and proportionate penalties on recipients as provided for in sector - specific rules and in national legislation . ### without prejudice to complementary provisions included in relevant sector - specific regulations , and in order to ensure in shared management that the funds are used in accordance with the applicable rules and principles , the member states shall take all the legislative , regulatory and administrative or other measures necessary for protecting the union ' s financial interests . to this effect they shall in particular : satisfy themselves that actions financed from the budget are actually carried out and ensure that they are implemented correctly , and for that purpose accredit bodies responsible for the management and control of union funds ; the commission shall appraise the systems set up in the member states on application by a member state or on its own risk assessment or in application of sector specific rules the accrediting authority shall be responsible for monitoring compliance of the accredited bodies with the accreditation criteria , on the basis of available audits and control results . the accrediting authority shall take all necessary measures to remedy any deficiency in the implementation of the tasks entrusted by the bodies it has accredited , including the suspension and withdrawal of the accreditation prevent and deal with irregularities and fraud ; recover funds wrongly paid or incorrectly used or funds lost as a result of irregularities or errors ; to that effect , the accredited bodies in the member states shall conduct checks and put in place an effective and efficient internal control system , and provide the commission by 1 march of the following financial year with : their annual accounts drawn up for the expenditure made in the execution of the tasks entrusted and presented to the commission for reimbursement including the balance received from the commission for which reimbursement has not yet been requested and sums disbursed to the beneficiaries for which recovery procedures are underway ; a summary of the results of available audits and checks carried out , including an analysis of systemic or recurrent weaknesses as well as corrective actions taken or planned and their results ; a management declaration providing reasonable assurance that : the information contained in the accounts presents a true and fair view ; the expenditure referred in the accounts has been used for its intended purpose and in accordance with the principle of sound financial management ; the control procedures put in place give the necessary guarantees concerning the legality and regularity of the underlying transactions . an annex to the declaration shall present the error rate per funds and an analysis of the errors as well as reservations , if the error rate exceeds 2% . these documents shall be accompanied by an opinion of an independent audit body , drawn up in accordance with the internationally accepted audit standards , on the contents of the management declaration . the audit body shall report if the examination puts in doubt the assertions made in the management declaration . the member states shall indicate replacements of the person providing the management declaration to the commission ' s competent authorising officer by delegation who shall display these changes in his annual activity report . member states shall , at the appropriate level , publish this information no later than 6 months after having provided the commission with these documents . the member states shall bring legal proceedings as necessary and appropriate . to the extent that member states immediately disclose errors and / or irregularities they discover to the commission and remedy these , they shall be exempt from financial corrections concerning such errors and / or irregularities .


### the contributions of the union and the donors shall be entered into a specific bank account . these contributions are not integrated in the budget and are managed by the commission under the responsibility of the authorising officer by delegation . the entities and persons referred to in point of article 55 may be entrusted with budget implementation tasks in accordance with the relevant rules for indirect management . ### the contributions of the union and the donors shall be entered into a specific bank account . these contributions are not integrated in the budget and are managed by the commission under the responsibility of the authorising officer by delegation . article 55 applies .


### member states shall prevent , detect and correct irregularities and fraud when executing tasks related to the implementation of the budget . to this end they shall carry out ex ante and ex post controls including , where appropriate , on the spot checks , to ensure that the actions financed from the budget are effectively carried out and implemented correctly , recover funds unduly paid and bring legal proceedings as necessary . member states shall impose effective , dissuasive and proportionate penalties on recipients as provided for in sector - specific rules and in national legislation . ### specific duties of the member states member states shall take all the legislative , regulatory and administrative or other measures necessary for protecting the union ' s financial interests , in particular satisfy themselves that actions financed from the budget are actually carried out and to ensure that they are implemented correctly and for that purpose accredit bodies responsible for the management and control of union funds ; prevent , detect and correct irregularities and fraud , when executing tasks related to the implementation of the budget . to this effect , they shall carry out in accordance with the principle of proportionality , and in compliance with paragraphs 2 , 3 to 5 as well as the relevant sector - specific rules , ex ante and ex post checks including , where appropriate , on the spot checks on representative samples of transactions . they shall also recover funds unduly paid and bring legal proceedings as necessary ; the commission may appraise the systems set up in the member states on application by a member state or on its own risk assessment or in application of sector specific rules . as far as member states immediately disclose errors and / or irregularities they discover to the commission and remedy these , they shall be exempt from financial corrections concerning such errors and / or irregularities . member states shall impose effective , dissuasive and proportionate penalties on recipients where provided for in sector - specific rules and without prejudice to specific provisions in national legislation .


### in accordance with the sector - specific rules , member states shall accredit one or more public sector bodies which shall be solely responsible for the proper management and control of the funds , for which accreditation has been granted . this shall be without prejudice to the possibility for these bodies to carry out tasks not related to the management of union funds or to entrust certain of their tasks to other bodies . the accreditation shall be given by a member state authority in accordance with sector - specific rules ensuring that the body is capable of properly managing the funds . the sector - specific rules may also define a role of the commission in the accreditation process . the accrediting authority shall be responsible for supervising the body and for taking all necessary measures to remedy any deficiency in its operation , including the suspension and withdrawal of the accreditation . ### in accordance with criteria and procedures laid down in sector - specific rules , a member state authority shall accredit bodies responsible for the management and internal control of union funds . this shall be without prejudice to the possibility for these bodies to carry out tasks not related to the management of union funds or to entrust certain of their tasks to other bodies . the role of the commission in the accreditation process shall be defined in sector - specific rules taking account of the risk in the policy area concerned . nevertheless , the commission may appraise the systems set up in the member states on application by a member state or on its own risk assessment ;


### the amount of the grant shall not become final until after the authorising officer responsible has accepted the final reports and accounts , without prejudice to subsequent checks by the institution . ### the amount of the grant shall not become final until after the competent authorising officer by delegation has accepted the final reports and accounts , without prejudice to subsequent checks by the institution , which shall be carried out in a timely manner .


### indirectly , in shared management with member states or by entrusting budget implementation tasks to : third countries or the bodies they have designated ; international organisations and their agencies ; financial institutions entrusted with the implementation of financial instruments pursuant to title viii ; the european investment bank and the european investment fund or any other subsidiary of the bank ; bodies referred to in articles 200 and 201 ; public law bodies or bodies governed by private law with a public service mission as far as these latter provide adequate financial guarantees ; bodies governed by private law of a member state , entrusted with the implementation of a public and private partnership and providing adequate financial guarantees ; persons entrusted with the implementation of specific actions pursuant to title v of the treaty on the european union , and identified in the relevant basic act within the meaning of article 51 of this regulation . ### indirectly , in shared management with member states or , subject to a specific provision in the basic act which shall also set out the specific implementing partners and types of operations , by entrusting certain specified budget implementation tasks to : third countries or the bodies they have designated ; international organisations and their agencies ; the european investment bank and the european investment fund ; public law bodies or bodies governed by private law with a public service mission as far as these latter provide adequate financial guarantees ; persons entrusted with the implementation of specific actions in the common foreign and security policy pursuant to title v of the treaty on the european union , and identified in the relevant basic act within the meaning of article 51 of this regulation . the commission remains responsible for the implementation of the budget and shall inform the european parliament on the operations carried out by the entities under points to . the financial statement of this regulation shall provide a full justification for the choice of a particular entity under points to .


### the commission may implement financial instruments in direct management mode , or in indirect management mode by entrusting tasks to the entities referred to in points and of article 55 . ### the commission may implement financial instruments in direct management mode , or in indirect management mode by entrusting tasks to the entities referred to in points , and of article 55 . the statute and nature of the operator to which the management is entrusted should be defined in the basic act .


### member states shall respect the principles of sound financial management , transparency and non - discrimination and ensure the visibility of union action when they manage union funds . to this end , member states shall fulfil the control and audit obligations and assume the resulting responsibilities laid down in this regulation . complementary provisions may be laid down in sector - specific rules . ### responsibilities for budget implementation in shared management where the commission implements the budget by shared management , implementation tasks shall be delegated to member states . these shall respect the principles of sound financial management , transparency and non - discrimination , and ensure the visibility of union action when they manage union funds . to this end , the commission and the member states shall fulfil their respective control and audit obligations , and assume the resulting responsibilities laid down in this regulation . complementary provisions may be laid down in sector - specific rules .


### paragraphs 5 and 6 of this article shall not apply to entities and persons which are subject to a separate procedure of discharge from the budgetary authority . ### paragraphs 5 and 6 of this article shall not apply to union entities which are subject to a separate discharge procedure when these entities implement the union budget .


### article 89 the validation , authorisation and payment of expenditure must be completed within the time limits laid down in the delegated regulation referred to in article 199 , which shall also specify the circumstances in which creditors paid late are entitled to receive default interest charged to the line from which the principal was paid . ### article 89 the time allowed for making payments shall be : 90 calendar days for contracts , grant agreements and decisions involving technical services or actions which are particularly complex to evaluate and for which payment depends on the approval of a report or a certificate ; 60 calendar days for all other contracts , grant agreements and decisions for which payment depends on the approval of a report or a certificate ; 30 calendar days in all other cases . these time limits shall not apply to payments under shared management . 2 . the competent authorising officer by delegation or subdelegation may suspend the time limit for payment by informing creditors , at any time that the payment request cannot be met , either because the amount is not due or because the appropriate supporting documents have not been produced . if information comes to the notice of the competent authorising officer which puts in doubt the eligibility of expenditure appearing in a payment request , the authorising officer may suspend the time limit for payment for the purpose of further verification , including on the spot checks , in order to ascertain , prior to payment , that the expenditure has been indeed eligible . the creditors concerned shall be informed in writing of the reasons for suspension . where the suspension exceeds two months , the competent clearing committee shall take a decision on the continuity of the suspension upon an application by the creditor . on expiry of the time limits laid down in paragraph 1 , the creditor shall be entitled to interest .


### the commission shall : apply procedures for a timely financial clearance of the accounts of the accredited bodies , ensuring that the accounts are complete , accurate and true and allowing for a timely clearance of irregularity cases ; exclude from union financing expenditure the disbursements which have been made in breach of union law . sector - specific rules shall govern the conditions under which payments to member states may be suspended by the commission or interrupted by the authorising officer by delegation ### specific duties of the commission in order to ensure that the funds are used in accordance with the applicable rules , the commission shall : monitor the manner in which member states fulfil their responsibilities , in particular by carrying out audits during the programme implementation ; apply procedures for a timely financial clearance of the accounts of the accredited bodies , establishing whether the accounts are complete , accurate and true ; exclude from union financing expenditure for which disbursements have been made in breach of union law . interrupt payment deadlines or suspend payments in case of significant deficiencies in the monitoring by a member state or in the functioning of a body accredited in accordance with paragraph 3 . the commission may decide to lift all or part of the interruption or suspension on payments after a member state has presented its observations . the decision to lift the interruption or suspension shall be annexed to the annual activity report of the competent authorising officer by delegation .


### bodies accredited pursuant to paragraph 3 of this article shall provide the commission by 1 february of the following financial year with : their accounts drawn up for the expenditure made in the execution of the tasks entrusted ; a summary of the results of all available audits and controls carried out , including an analysis of systematic or recurrent weaknesses as well as corrective actions taken or planned ; a management declaration of assurance as to the completeness , accuracy and veracity of the accounts , the proper functioning of the internal control systems as well as to the legality and regularity of the underlying transactions and the respect of the principle of sound financial management ; the opinion of an independent audit body on the management declaration of assurance mentioned in point of this paragraph , covering all its elements . if a member state has accredited more than one body per policy area , it shall by 15 february of the following financial year provide the commission with a synthesis report consisting of an overview at national level of all management declarations of assurance and the independent audit opinions thereon , prepared for the policy area concerned . ### in accordance with their function , bodies accredited pursuant to paragraph 3 of this article shall provide the commission by 1 march of the following financial year with : their annual accounts drawn up for the expenditure made in the execution of the tasks entrusted and presented to the commission for reimbursement including the balance received from the commission for which reimbursement has not yet been requested and sums disbursed to the beneficiaries for which recovery procedures are underway ; a summary of the results of available audits and checks carried out , including an analysis of systemic or recurrent weaknesses as well as corrective actions taken or planned and their results ; a management declaration providing reasonable assurance that : the information contained in the accounts presents a true and fair view ; the expenditure referred in the accounts has been used for its intended purpose and in accordance with the principle of sound financial management ; the control procedures put in place give the necessary guarantees concerning the legality and regularity of the underlying transactions . an annex to the declaration shall present the error rate per funds and an analysis of the errors as well as reservations , if the error rate exceeds 2% ; these documents shall be accompanied by an opinion of an independent audit body , drawn up in accordance with the internationally accepted audit standards , on the completeness , accuracy and veracity of the accounts , on the proper functioning of the control procedures put in place as well as on the legality and regularity of the underlying transactions . the audit body shall report if the examination puts in doubt the assertions made in the management declaration . the member states shall indicate replacements of the person providing the management declaration to the commission ' s competent authorising officer by delegation who shall display these changes in his annual activity report . member states shall , at the appropriate level , publish this information no later than 6 months after having provided the commission with these documents . if a member state has accredited more than one body with responsibility for ex ante and ex post verifications per policy area , it shall by 15 march of the following financial year provide the commission with a synthesis report consisting of an overview at national level of all management declarations of assurance and the corresponding independent audit opinions , prepared for the policy area concerned .


### in accordance with the sector - specific rules , member states shall accredit one or more public sector bodies which shall be solely responsible for the proper management and control of the funds , for which accreditation has been granted . this shall be without prejudice to the possibility for these bodies to carry out tasks not related to the management of union funds or to entrust certain of their tasks to other bodies . the accreditation shall be given by a member state authority in accordance with sector - specific rules ensuring that the body is capable of properly managing the funds . the sector - specific rules may also define a role of the commission in the accreditation process . the accrediting authority shall be responsible for supervising the body and for taking all necessary measures to remedy any deficiency in its operation , including the suspension and withdrawal of the accreditation . ### role and competences of the accrediting authority in accordance with criteria and procedures laid down in sector - specific rules , a member state authority shall accredit bodies responsible for the management and internal control of union funds . this shall be without prejudice to the possibility for these bodies to carry out tasks not related to the management of union funds or to entrust certain of their tasks to other bodies . the accrediting authority shall further be responsible for monitoring compliance of the accredited bodies with the accreditation criteria , on the basis of available audits and control results . it shall take all necessary measures to remedy any deficiency in the implementation of the tasks entrusted by the bodies it has accredited , including the suspension and withdrawal of the accreditation . the role of the commission in the accreditation process to which paragraph 2 applies shall be further defined in sector - specific rules taking account of the risk in the policy area concerned .


### without prejudice to points and of article 46 , the budgetary expenditure linked to a financial instrument shall be kept within the relevant budgetary commitment made for it . ### without prejudice to points and of article 46 , the budgetary expenditure linked to a financial instrument and the financial liability of the union shall not exceed the amount of the relevant budgetary commitment made for it , thus excluding contingent liabilities for the union budget .


### bodies accredited pursuant to paragraph 3 of this article shall provide the commission by 1 february of the following financial year with : their accounts drawn up for the expenditure made in the execution of the tasks entrusted ; a summary of the results of all available audits and controls carried out , including an analysis of systematic or recurrent weaknesses as well as corrective actions taken or planned ; a management declaration of assurance as to the completeness , accuracy and veracity of the accounts , the proper functioning of the internal control systems as well as to the legality and regularity of the underlying transactions and the respect of the principle of sound financial management ; the opinion of an independent audit body on the management declaration of assurance mentioned in point of this paragraph , covering all its elements . if a member state has accredited more than one body per policy area , it shall by 15 february of the following financial year provide the commission with a synthesis report consisting of an overview at national level of all management declarations of assurance and the independent audit opinions thereon , prepared for the policy area concerned . ### if a member state has accredited more than one body with responsibility for ex ante and ex post verifications per policy area , it shall by 15 march of the following financial year provide the commission with a synthesis report consisting of an overview at national level of all management declarations of assurance and the corresponding independent audit opinions , prepared for the policy area concerned .


### bodies accredited pursuant to paragraph 3 of this article shall provide the commission by 1 february of the following financial year with : their accounts drawn up for the expenditure made in the execution of the tasks entrusted ; a summary of the results of all available audits and controls carried out , including an analysis of systematic or recurrent weaknesses as well as corrective actions taken or planned ; a management declaration of assurance as to the completeness , accuracy and veracity of the accounts , the proper functioning of the internal control systems as well as to the legality and regularity of the underlying transactions and the respect of the principle of sound financial management ; the opinion of an independent audit body on the management declaration of assurance mentioned in point of this paragraph , covering all its elements . if a member state has accredited more than one body per policy area , it shall by 15 february of the following financial year provide the commission with a synthesis report consisting of an overview at national level of all management declarations of assurance and the independent audit opinions thereon , prepared for the policy area concerned . ### content , timing and audit of data reported by the accredited bodies member states at the appropriate level , by means of bodies accredited pursuant to paragraph 3 , shall provide the commission by 1st march with accounting information at the level of the accredited bodies on the expenditure made in the execution of the tasks entrusted and presented to the commission for reimbursement including the balance received from the commission for which reimbursement has not yet been requested , and sums disbursed for which recovery procedures are underway . this information shall be accompanied by a statement of management responsibilities confirming that , in the opinion of those in charge of the management of the funds : - this information is properly presented , complete and accurate ; - the expenditure has been used for its intended purpose , as defined in the sector - specific rules ; - the control procedures put in place give the necessary guarantees concerning the legality and regularity of the underlying transactions ; an annex to the declaration shall present the error rate per funds and an analysis of the errors as well as reservations , if the error rate exceeds 2% ; a summary of the results of the available final audit reports and checks carried out , including an analysis of recurrent or systemic weaknesses , as well as corrective actions taken or planned and their results . these documents shall be accompanied by an opinion of an independent audit body , drawn up in accordance with internationally accepted audit standards , on whether the accounting information gives a true and fair view , and expenditure for which reimbursement has been requested from the commission is legal and regular as well as on the proper functioning of the control procedures put in place . this opinion shall state if the examination puts in doubt the assertions made in the statement of management responsibilities . an annex to the opinion shall present the error rate per funds and an analysis of the errors as well as reservations . the member states shall indicate replacements of the person providing the management declaration to the commission ' s competent authorising officer by delegation who shall display these changes in his annual activity report . if a member state has accredited more than one body with responsibility for ex ante and ex post verifications per policy area , it shall by 15 march of the following financial year provide the commission with a synthesis report consisting of an overview at national level of all management declarations of assurance and the corresponding independent audit opinions , prepared for the policy area concerned . member states shall , at the appropriate level , publish this information no later than 6 months after having provided the commission with these documents .


### grants may not have the purpose or effect of producing a profit within the framework of the action or the work programme of the beneficiary . the first subparagraph shall not apply to : actions the objective of which is the reinforcement of the financial capacity of a beneficiary or the generation of an income ; study , research or training scholarships paid to natural persons ; ### grants may not have the purpose or effect of producing a profit within the framework of the action or the work programme of the beneficiary . the first subparagraph shall not apply to : actions the objective of which is the reinforcement of the financial capacity of a beneficiary or actions which generate an income to ensure their sustainability after the period of union financing provided for in the grant decision or agreement ; study , research or training scholarships paid to natural persons and other direct support paid to natural persons in most need , such as refugees and unemployed persons ; grants based on flat rates and / or lump sums and / or unit costs where these comply with with the conditions set out in article 116a ; low value grants . where a profit is made , the commission shall be entitled to recover the percentage of the profit corresponding to the union contribution to the eligible costs actually incurred by the beneficiary to carry out the action or work programme .


### in the performance of its task , the court of auditors shall be entitled to consult , in the manner provided for in article 152 , all documents and information relating to the financial management of departments or bodies with regard to operations financed or co - financed by the union . it shall have the power to make enquiries of any official responsible for a revenue or expenditure operation and to use any of the auditing procedures appropriate to the aforementioned departments or bodies . the audit in the member states shall be carried out in conjunction with the national audit institutions or , where they do not have the necessary powers , with the national departments responsible . the court of auditors and the national audit bodies of the member states shall cooperate in a spirit of trust while maintaining their independence . ### in the performance of its task , the court of auditors shall be entitled to consult , in the manner provided for in article 152 , all documents and information relating to the financial management of departments or bodies with regard to operations financed or co - financed by the union . it shall have the power to make enquiries of any official responsible for a revenue or expenditure operation and to use any of the auditing procedures appropriate to the aforementioned departments or bodies . the audit in the member states shall be carried out in liaison with the national audit institutions or , where they do not have the necessary powers , with the competent national departments . the court of auditors and the national audit institutions of the member states shall cooperate in a spirit of trust while maintaining their independence .


### after approving the final consolidated accounts and its own final accounts , the commission shall send them both to the european parliament , the council and the court of auditors before 31 july of the following financial year . ### after approving the final consolidated accounts and its own final accounts , the commission shall send them both to the european parliament , the council and the court of auditors before 31 march of the following financial year .


### in respect of any measure which may give rise to expenditure chargeable to the budget , the authorising officer responsible must first make a budgetary commitment before entering into a legal obligation with third parties or transferring funds to a trust fund on the basis of article 178 . ### notwithstanding article 82 , in respect of any measure which may give rise to expenditure chargeable to the budget , the authorising officer responsible must first make a budgetary commitment before entering into a legal obligation with third parties or transferring funds to a trust fund on the basis of article 178 . however , in case of humanitarian aid operations , civil protection operations and crisis management aid , provided that it is indispensable for the efficient delivery of the union ' s intervention to enter into a legal commitment with third parties immediately without being possible to make a prior booking of the individual budgetary commitment , the latter may be booked without delay after entering into a legal obligation with third parties .


### the commission shall adopt a delegated regulation on detailed rules for the application of this regulation in accordance with articles 202 , 203 and 204 . the delegated regulation shall include rules on the implementation of administrative expenditure relating to the appropriations provided in the budget for the euratom supply agency . ### the commission shall be empowered to adopt a delegated regulation in accordance with articles 202 , 203 and 204 concerning detailed rules to supplement or amend certain non - essential elements of the following articles : 5 , 8 , 9 , 16 , 18 , 19 , 20 , 22 , 23 , 25 , 26 , 27 , 30 , 31 , 34 , 38 , 46 , 50 , 51 , 55 , 56 , 57 , 58 , 61 , 63 , 65 , 66 , 67 , 69 , 70 , 71 , 72 , 75 , 76 , 77 , 78 , 80 , 81 , 82 , 83 , 84 , 85 , 86 , 87 , 90 , 92 , 93 , 94 , 95 , 97 , 98 , 99 , 100 , 101 , 102 , 103 , 104 , 105 , 106 , 107 , 108 , 109 , 110 , 111 , 112 , 113 , 114 , 115 , 116 , 117 , 118 , 119 , 120 , 122 , 123 , 124 , 125 , 126 , 127 , 133 , 135 , 136 , 137 , 139 , 142 , 145 , 147 , 148 , 173 , 175 , 176 , 178 , 179 , 180 , 181 , 182 , 183 , 184 , 187 , 188 , 191 , 193 , 195 , 196 , 197 . the delegated regulation shall also include rules on the implementation of administrative expenditure relating to the appropriations provided in the budget for the euratom supply agency .


### in accordance with the sector - specific rules , member states shall accredit one or more public sector bodies which shall be solely responsible for the proper management and control of the funds , for which accreditation has been granted . this shall be without prejudice to the possibility for these bodies to carry out tasks not related to the management of union funds or to entrust certain of their tasks to other bodies . the accreditation shall be given by a member state authority in accordance with sector - specific rules ensuring that the body is capable of properly managing the funds . the sector - specific rules may also define a role of the commission in the accreditation process . the accrediting authority shall be responsible for supervising the body and for taking all necessary measures to remedy any deficiency in its operation , including the suspension and withdrawal of the accreditation . ### in accordance with criteria and procedures laid down in sector - specific rules , a member state authority shall accredit bodies responsible for the management and internal control of union funds . this shall be without prejudice to the possibility for these bodies to carry out tasks not related to the management of union funds or to entrust certain of their tasks to other bodies . the role of the commission in the accreditation process shall be defined in sector - specific rules taking account of the risk in the policy area concerned . nevertheless , the commission may appraise the systems set up in the member states on application by a member state or on its own risk assessment ;


### indirectly , in shared management with member states or by entrusting budget implementation tasks to : third countries or the bodies they have designated ; international organisations and their agencies ; financial institutions entrusted with the implementation of financial instruments pursuant to title viii ; the european investment bank and the european investment fund or any other subsidiary of the bank ; bodies referred to in articles 200 and 201 ; public law bodies or bodies governed by private law with a public service mission as far as these latter provide adequate financial guarantees ; bodies governed by private law of a member state , entrusted with the implementation of a public and private partnership and providing adequate financial guarantees ; persons entrusted with the implementation of specific actions pursuant to title v of the treaty on the european union , and identified in the relevant basic act within the meaning of article 51 of this regulation . ### indirectly , in shared management with member states or , subject to a specific provision in the basic act which shall also set out , other than in the cases of and , the type of implementing partners and types of operations , by entrusting certain specified budget implementation tasks to : third countries or the bodies they have designated ; international organisations and their agencies ; the european investment bank and the european investment fund ; bodies referred to in articles 196b and 196c ; public law bodies or bodies governed by private law with a public service mission as far as these latter provide adequate financial guarantees ; persons entrusted with the implementation of specific actions in the common foreign and security policy pursuant to title v of the treaty on the european union , and identified in the relevant basic act within the meaning of article 51 of this regulation . the commission remains responsible for the implementation of the budget and shall inform the european parliament on the operations carried out by the entities under points to . the financial statement shall provide a full justification for the choice of a particular entity under points to .


### if the european parliament or the council objects to a delegated act , it shall not enter into force . the institution which objects shall state the reasons for objecting to the delegated act . ### if either the european parliament or the council or both institutions have proposed modifications to a delegated regulation or parts of it , the commission shall take note of the modifications and submit a revised proposal . the european parliament or the council may object to this revised proposal within a term of three months from the date of notification , in which case it does not enter into force .


### member states shall prevent , detect and correct irregularities and fraud when executing tasks related to the implementation of the budget . to this end they shall carry out ex ante and ex post controls including , where appropriate , on the spot checks , to ensure that the actions financed from the budget are effectively carried out and implemented correctly , recover funds unduly paid and bring legal proceedings as necessary . member states shall impose effective , dissuasive and proportionate penalties on recipients as provided for in sector - specific rules and in national legislation . ### specific duties of the member states member states shall take all the legislative , regulatory and administrative or other measures necessary for protecting the union ' s financial interests , in particular satisfy themselves that actions financed from the budget are actually carried out and to ensure that they are implemented correctly and for that purpose accredit bodies responsible for the management and control of union funds ; prevent , detect and correct irregularities and fraud , when executing tasks related to the implementation of the budget . to this effect , they shall carry out in accordance with the principle of proportionality , and in compliance with paragraphs 2 , 3 to 5 as well as the relevant sector - specific rules , ex ante and ex post checks including , where appropriate , on the spot checks on representative samples of transactions . they shall also recover funds unduly paid and bring legal proceedings as necessary ; the commission may appraise the systems set up in the member states on application by a member state or on its own risk assessment or in application of sector specific rules . as far as member states immediately disclose errors and / or irregularities they discover to the commission and remedy these , they shall be exempt from financial corrections concerning such errors and / or irregularities . member states shall impose effective , dissuasive and proportionate penalties on recipients where provided for in sector - specific rules and without prejudice to specific provisions in national legislation .


### tolerable risk of error the legislative authority shall , in accordance with the procedure laid down in article 322 of the tfeu , decide on a level of tolerable risk of error at an appropriate aggregation of the budget . that decision shall be taken into account during the annual discharge procedure , in accordance with article 157 . the level of tolerable risk of error shall be based on an analysis of the costs and benefits of controls . member states and entities and persons referred to in point article 55 shall on request report to the commission on the costs of controls borne by them as well as the number and size of activities financed by the budget . the level of tolerable risk of error shall be closely monitored and shall be reviewed in case of major changes in the control environment . ### risk of error when presenting revised or new spending proposals , the commission shall estimate the cost of administrative and control systems as well as the level of risk of error with the proposed legislation per funds and per member state . if , during the programme implementation , the level of error is persistently high , the commission shall identify the weaknesses in the control systems and analyse the cost and benefits of possible corrective measures and take appropriate action such as simplification of the applicable provisions , re - design of the programme , tightening of controls or , if necessary , termination of the activity .


### the commission shall : apply procedures for a timely financial clearance of the accounts of the accredited bodies , ensuring that the accounts are complete , accurate and true and allowing for a timely clearance of irregularity cases ; exclude from union financing expenditure the disbursements which have been made in breach of union law . sector - specific rules shall govern the conditions under which payments to member states may be suspended by the commission or interrupted by the authorising officer by delegation . ### in order to ensure that the funds are used in accordance with the applicable rules , the commission shall : supervise that member states fulfil their responsibilities , in particular by carrying out audits during the programme implementation ; apply procedures for a timely financial clearance of the accounts of the accredited bodies , establishing whether the accounts are complete , accurate and true ; exclude from union financing expenditure for which disbursements have been made in breach of union law interrupt payment deadlines or suspend payments in case of significant deficiencies in the supervision by a member state or in the functioning of a body accredited in accordance with paragraph 3 . the commission may decide to lift all or part of the interruption or suspension on payments after a member state has presented its observations . the decision to lift the interruption or suspension shall be annexed to the annual activity report of the competent authorising officer by delegation .


### the institution may formally establish an amount as being receivable from persons other than member states by means of a decision which shall be enforceable within the meaning of article 256 of the ec treaty . ### the council , the commission or the european central bank may formally establish an amount as being receivable from persons other than member states by means of a decision which shall be enforceable within the meaning of article 299 tfeu . as regards the other institutions , the commission may adopt , on their behalf , such an enforceable decision within the meaning of article 299 tfeu , under the conditions laid down in the delegated regulation referred to in article 199 .


### each agreement between an entity referred to in point and of article 55 and a financial intermediary referred to in paragraph 3 shall provide expressly for the commission and the court of auditors to exercise their powers of control , on documents and on the premises and on information , even stored on electronic media , over all third parties who have received union funds . ### each agreement between an entity referred to in point and of article 55 and a financial intermediary referred to in paragraph 3 shall provide expressly for the access of the commission and the court of auditors and olaf to exercise their powers of control , to documents and to the premises and on information , even stored on electronic media , of all third parties who have received and / or are involved in the management of union funds .


### where relevant , the commission shall attach to the draft budget a financial programming for the following years . ### the commission shall attach to the draft budget a financial programming for the following years .


### bodies accredited pursuant to paragraph 3 of this article shall : set up and ensure the functioning of an effective and efficient internal control system ; use an annual accounting system providing accurate , complete and reliable information in a timely manner ; be subject to an independent external audit , performed in accordance with internationally accepted auditing standards by an audit service functionally independent of the accredited body ; ensure , in conformity with article 31 , annual ex post publication of recipients of union funds ; ensure a protection of personal data which satisfies the principles laid down in directive 95 / 46 / ec . ### role and competences of the accredited body member states at the appropriate level , by means of bodies accredited pursuant to paragraph 3 of this article shall : conduct checks and set up and ensure the functioning of an effective and efficient internal control system ; use an annual accounting system providing accurate , complete and reliable information in a timely manner ; provide the prerequisite data and information in accordance with paragraph 5 ; ensure ex post publication of recipients of union funds in accordance with article 31 . any processing of personal data shall comply with national provisions implementing directive 95 / 46 / ec .


### bodies accredited pursuant to paragraph 3 of this article shall : set up and ensure the functioning of an effective and efficient internal control system ; use an annual accounting system providing accurate , complete and reliable information in a timely manner ; be subject to an independent external audit , performed in accordance with internationally accepted auditing standards by an audit service functionally independent of the accredited body ; ensure , in conformity with article 31 , annual ex post publication of recipients of union funds ; ensure a protection of personal data which satisfies the principles laid down in directive 95 / 46 / ec . ### in accordance with their functions , bodies accredited pursuant to paragraph 3 of this article shall : set up and ensure the functioning of an effective and efficient internal control system ; use an annual accounting system providing accurate , complete and reliable information in a timely manner ; ensure ex post publication of recipients of union funds in accordance with article 31 . any processing of personal data shall comply with national provisions implementing directive 95 / 46 / ec .


### the amount of the grant shall not become final until after the authorising officer responsible has accepted the final reports and accounts , without prejudice to subsequent checks by the institution . ### the amount of the grant shall not become final until after the competent authorising officer by delegation has accepted the final reports and accounts , without prejudice to subsequent checks by the institution , which shall be carried out in a timely manner .


### member states shall prevent , detect and correct irregularities and fraud when executing tasks related to the implementation of the budget . to this end they shall carry out ex ante and ex post controls including , where appropriate , on the spot checks , to ensure that the actions financed from the budget are effectively carried out and implemented correctly , recover funds unduly paid and bring legal proceedings as necessary . member states shall impose effective , dissuasive and proportionate penalties on recipients as provided for in sector - specific rules and in national legislation . ### without prejudice to complementary provisions included in relevant sector - specific regulations , and in order to ensure in shared management that the funds are used in accordance with the applicable rules and principles , the member states shall take all the legislative , regulatory and administrative or other measures necessary for protecting the union ' s financial interests . to this effect they shall in particular : satisfy themselves that actions financed from the budget are actually carried out and ensure that they are implemented correctly , and for that purpose accredit bodies responsible for the management and control of union funds ; the commission shall appraise the systems set up in the member states on application by a member state or on its own risk assessment or in application of sector specific rules the accrediting authority shall be responsible for monitoring compliance of the accredited bodies with the accreditation criteria , on the basis of available audits and control results . the accrediting authority shall take all necessary measures to remedy any deficiency in the implementation of the tasks entrusted by the bodies it has accredited , including the suspension and withdrawal of the accreditation prevent and deal with irregularities and fraud ; recover funds wrongly paid or incorrectly used or funds lost as a result of irregularities or errors ; to that effect , the accredited bodies in the member states shall conduct checks and put in place an effective and efficient internal control system , and provide the commission by 1 march of the following financial year with : their annual accounts drawn up for the expenditure made in the execution of the tasks entrusted and presented to the commission for reimbursement including the balance received from the commission for which reimbursement has not yet been requested and sums disbursed to the beneficiaries for which recovery procedures are underway ; a summary of the results of available audits and checks carried out , including an analysis of systemic or recurrent weaknesses as well as corrective actions taken or planned and their results ; a management declaration providing reasonable assurance that : the information contained in the accounts presents a true and fair view ; the expenditure referred in the accounts has been used for its intended purpose and in accordance with the principle of sound financial management ; the control procedures put in place give the necessary guarantees concerning the legality and regularity of the underlying transactions . an annex to the declaration shall present the error rate per funds and an analysis of the errors as well as reservations , if the error rate exceeds 2% . these documents shall be accompanied by an opinion of an independent audit body , drawn up in accordance with the internationally accepted audit standards , on the contents of the management declaration . the audit body shall report if the examination puts in doubt the assertions made in the management declaration . the member states shall indicate replacements of the person providing the management declaration to the commission ' s competent authorising officer by delegation who shall display these changes in his annual activity report . member states shall , at the appropriate level , publish this information no later than 6 months after having provided the commission with these documents . the member states shall bring legal proceedings as necessary and appropriate . to the extent that member states immediately disclose errors and / or irregularities they discover to the commission and remedy these , they shall be exempt from financial corrections concerning such errors and / or irregularities .


### indirectly , in shared management with member states or by entrusting budget implementation tasks to : third countries or the bodies they have designated ; international organisations and their agencies ; financial institutions entrusted with the implementation of financial instruments pursuant to title viii ; the european investment bank and the european investment fund or any other subsidiary of the bank ; bodies referred to in articles 200 and 201 ; public law bodies or bodies governed by private law with a public service mission as far as these latter provide adequate financial guarantees ; bodies governed by private law of a member state , entrusted with the implementation of a public and private partnership and providing adequate financial guarantees ; persons entrusted with the implementation of specific actions pursuant to title v of the treaty on the european union , and identified in the relevant basic act within the meaning of article 51 of this regulation . ### indirectly , in shared management with member states or , subject to a specific provision in the basic act which shall also set out the specific implementing partners and types of operations , by entrusting certain specified budget implementation tasks to : third countries or the bodies they have designated ; international organisations and their agencies ; the european investment bank and the european investment fund ; public law bodies or bodies governed by private law with a public service mission as far as these latter provide adequate financial guarantees ; persons entrusted with the implementation of specific actions in the common foreign and security policy pursuant to title v of the treaty on the european union , and identified in the relevant basic act within the meaning of article 51 of this regulation . the commission remains responsible for the implementation of the budget and shall inform the european parliament on the operations carried out by the entities under points to . the financial statement of this regulation shall provide a full justification for the choice of a particular entity under points to .


### bodies accredited pursuant to paragraph 3 of this article shall provide the commission by 1 february of the following financial year with : their accounts drawn up for the expenditure made in the execution of the tasks entrusted ; a summary of the results of all available audits and controls carried out , including an analysis of systematic or recurrent weaknesses as well as corrective actions taken or planned ; a management declaration of assurance as to the completeness , accuracy and veracity of the accounts , the proper functioning of the internal control systems as well as to the legality and regularity of the underlying transactions and the respect of the principle of sound financial management ; the opinion of an independent audit body on the management declaration of assurance mentioned in point of this paragraph , covering all its elements . if a member state has accredited more than one body per policy area , it shall by 15 february of the following financial year provide the commission with a synthesis report consisting of an overview at national level of all management declarations of assurance and the independent audit opinions thereon , prepared for the policy area concerned . ### in accordance with their function , bodies accredited pursuant to paragraph 3 of this article shall provide the commission by 1 march of the following financial year with : their annual accounts drawn up for the expenditure made in the execution of the tasks entrusted and presented to the commission for reimbursement including the balance received from the commission for which reimbursement has not yet been requested and sums disbursed to the beneficiaries for which recovery procedures are underway ; a summary of the results of available audits and checks carried out , including an analysis of systemic or recurrent weaknesses as well as corrective actions taken or planned and their results ; a management declaration providing reasonable assurance that : the information contained in the accounts presents a true and fair view ; the expenditure referred in the accounts has been used for its intended purpose and in accordance with the principle of sound financial management ; the control procedures put in place give the necessary guarantees concerning the legality and regularity of the underlying transactions . an annex to the declaration shall present the error rate per funds and an analysis of the errors as well as reservations , if the error rate exceeds 2% ; these documents shall be accompanied by an opinion of an independent audit body , drawn up in accordance with the internationally accepted audit standards , on the completeness , accuracy and veracity of the accounts , on the proper functioning of the control procedures put in place as well as on the legality and regularity of the underlying transactions . the audit body shall report if the examination puts in doubt the assertions made in the management declaration . the member states shall indicate replacements of the person providing the management declaration to the commission ' s competent authorising officer by delegation who shall display these changes in his annual activity report . member states shall , at the appropriate level , publish this information no later than 6 months after having provided the commission with these documents . if a member state has accredited more than one body with responsibility for ex ante and ex post verifications per policy area , it shall by 15 march of the following financial year provide the commission with a synthesis report consisting of an overview at national level of all management declarations of assurance and the corresponding independent audit opinions , prepared for the policy area concerned .


### the budget is the instrument which , for each financial year , forecasts and authorises all revenue and expenditure considered necessary for the union and the european atomic energy community . ### all revenue and expenditure have to be included in the budget and its annexes , including , for each financial year , forecasts and all authorised revenue and expenditure considered necessary for the union .


### in the performance of its task , the court of auditors shall be entitled to consult , in the manner provided for in article 152 , all documents and information relating to the financial management of departments or bodies with regard to operations financed or co - financed by the union . it shall have the power to make enquiries of any official responsible for a revenue or expenditure operation and to use any of the auditing procedures appropriate to the aforementioned departments or bodies . the audit in the member states shall be carried out in conjunction with the national audit institutions or , where they do not have the necessary powers , with the national departments responsible . the court of auditors and the national audit bodies of the member states shall cooperate in a spirit of trust while maintaining their independence . ### in the performance of its task , the court of auditors shall be entitled to consult , in the manner provided for in article 152 , all documents and information relating to the financial management of departments or bodies with regard to operations financed or co - financed by the union . it shall have the power to make enquiries of any official responsible for a revenue or expenditure operation and to use any of the auditing procedures appropriate to the aforementioned departments or bodies . the audit in the member states shall be carried out in liaison with the national audit institutions or , where they do not have the necessary powers , with the competent national departments . the court of auditors and the national audit institutions of the member states shall cooperate in a spirit of trust while maintaining their independence .


### the final consolidated accounts shall be published in the official journal of the european union together with the statement of assurance given by the court of auditors in accordance with article 287 of the tfeu and article 160c of the euratom treaty by 15 november of the following financial year . ### the final consolidated accounts shall be published in the official journal of the european union together with the statement of assurance given by the court of auditors in accordance with article 287 of the tfeu and article 160c of the euratom treaty by 31 july of the following financial year


### grants may not have the purpose or effect of producing a profit within the framework of the action or the work programme of the beneficiary . the first subparagraph shall not apply to : actions the objective of which is the reinforcement of the financial capacity of a beneficiary or the generation of an income ; study , research or training scholarships paid to natural persons ; ### grants may not have the purpose or effect of producing a profit within the framework of the action or the work programme of the beneficiary . the first subparagraph shall not apply to : actions the objective of which is the reinforcement of the financial capacity of a beneficiary or actions which generate an income to ensure their sustainability after the period of union financing provided for in the grant decision or agreement ; study , research or training scholarships paid to natural persons and other direct support paid to natural persons in most need , such as refugees and unemployed persons ; grants based on flat rates and / or lump sums and / or unit costs where these comply with with the conditions set out in article 116a ; low value grants . where a profit is made , the commission shall be entitled to recover the percentage of the profit corresponding to the union contribution to the eligible costs actually incurred by the beneficiary to carry out the action or work programme .


### member states shall respect the principles of sound financial management , transparency and non - discrimination and ensure the visibility of union action when they manage union funds . to this end , member states shall fulfil the control and audit obligations and assume the resulting responsibilities laid down in this regulation . complementary provisions may be laid down in sector - specific rules . ### responsibilities for budget implementation in shared management where the commission implements the budget by shared management , implementation tasks shall be delegated to member states . these shall respect the principles of sound financial management , transparency and non - discrimination , and ensure the visibility of union action when they manage union funds . to this end , the commission and the member states shall fulfil their respective control and audit obligations , and assume the resulting responsibilities laid down in this regulation . complementary provisions may be laid down in sector - specific rules .


### member states shall respect the principles of sound financial management , transparency and non - discrimination and ensure the visibility of union action when they manage union funds . to this end , member states shall fulfil the control and audit obligations and assume the resulting responsibilities laid down in this regulation . complementary provisions may be laid down in sector - specific rules . ### where the commission implements the budget by shared management , implementation tasks shall be delegated to member states . that method shall apply in particular to the actions referred to in titles i and ii of part two .


### the commission shall : apply procedures for a timely financial clearance of the accounts of the accredited bodies , ensuring that the accounts are complete , accurate and true and allowing for a timely clearance of irregularity cases ; exclude from union financing expenditure the disbursements which have been made in breach of union law . sector - specific rules shall govern the conditions under which payments to member states may be suspended by the commission or interrupted by the authorising officer by delegation ### specific duties of the commission in order to ensure that the funds are used in accordance with the applicable rules , the commission shall : monitor the manner in which member states fulfil their responsibilities , in particular by carrying out audits during the programme implementation ; apply procedures for a timely financial clearance of the accounts of the accredited bodies , establishing whether the accounts are complete , accurate and true ; exclude from union financing expenditure for which disbursements have been made in breach of union law . interrupt payment deadlines or suspend payments in case of significant deficiencies in the monitoring by a member state or in the functioning of a body accredited in accordance with paragraph 3 . the commission may decide to lift all or part of the interruption or suspension on payments after a member state has presented its observations . the decision to lift the interruption or suspension shall be annexed to the annual activity report of the competent authorising officer by delegation .