COMMISSION DECISION
of 20 January 2006
laying down detailed rules for the implementation of Council Decision 2004/904/EC as regards Member States management and control systems, and rules for the administrative and financial management of projects co-financed by the European Refugee Fund
(notified under document number C(2006) 51/3)
(Only the Czech, Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Italian, Swedish, Latvian, Lithuanian, Polish, Portuguese, Slovakian, Slovenian and Spanish texts are authentic)
(2006/401/EC)
THE COMMISSION OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Community,
Having regard to Council Decision 2004/904/EC of 2 December 2004 establishing the European Refugee Fund for the period 2005 to 2010 (1), and in particular Article 13, paragraph 5 thereof,
Whereas:
(1)
To ensure sound financial management of the assistance granted from the European Refugee Fund (the Fund), common guidelines should be adopted for the organisation of the tasks of the authorities responsible for implementing co-financed actions.
(2)
To ensure that the Community funds are utilised in accordance with the principles of sound financial management, management and control systems should be introduced that provide a sufficient audit trail, and lend the Commission any assistance it requires to carry out checks, especially sample checks.
(3)
To ensure that Community funds are used efficiently and appropriately, uniform criteria should be established for the checks carried out by the Member States under Article 25 of Decision 2004/904/EC.
(4)
To ensure uniform treatment of the declarations of expenditure for which assistance is requested from the Fund under Article 24 of Decision 2004/904/EC, a model declaration of expenditure should be produced.
(5)
In accordance with Article 3 of the Protocol on the position of the United Kingdom and Ireland, annexed to the Treaty on European Union and to the Treaty establishing the European Community, the United Kingdom takes part in Decision 2004/904/EC and by consequence in this present decision.
(6)
In accordance with Article 3 of the Protocol on the position of the United Kingdom and Ireland, annexed to the Treaty on European Union and to the Treaty establishing the European Community, Ireland takes part in Decision in 2004/904/EC and by consequence in this present decison.
(7)
In accordance with Articles 1 and 2 of the Protocol on the position of Denmark, annexed to the Treaty on European Union and to the Treaty establishing the European Community, Denmark does not take part in Decision 2004/904/EC and is not bound by it nor by this present decision.
(8)
The measures provided for in this Decision are in accordance with the opinion of the Committee established by Article 11 of Decision 2004/904/EC,
HAS ADOPTED THIS DECISION:
CHAPTER I
SCOPE AND DEFINITIONS
Article 1
This Decision lays down the detailed rules for implementing Decision 2004/904/EC as regards management and control systems and rules for the administrative and financial management for funding granted from the European Refugee Fund ‘the Fund’ and managed by the Member States.
Article 2
For the purposes of this Decision the following definition shall be used:
1.
‘Responsible Authority’: any functional body of the Member State or national public body designated by a Member State under Article 13, paragraph 1 of Decision 2004/904/EC.
2.
‘Delegated Authority’: any public administration, or private-law body governed by the law of the Member State and which has a public-service mission, to which the Responsible Authority delegates some or all of its implementation tasks under Article 13, paragraph 1 of Decision 2004/904/EC.
3.
‘Certifying Authority’: any individual or department operationally independent of any authorising department of the Responsible Authority and of any delegated Authority designated by the Member State for the purposes of the certification of declarations of expenditure under Article 24, paragraph 2 of Decision 2004/904/EC.
4.
‘Control Authority’: any individual or department operationally independent of any authorising department of the Responsible Authority and of any delegated Authority designated by the Member State for the purposes of the checks and audits on actions under Article 25, paragraph 1(a) of Decision 2004/904/EC.
CHAPTER II
MANAGEMENT AND CONTROL SYSTEMS
Article 3
General principles
The management and control systems set up by Member States shall provide for:
1.
a clear definition of the functions of the bodies and/or individuals concerned in the management and control and a clear allocation of functions within each body;
2.
a clear separation of functions between bodies, departments and/or individuals concerned in the management, control and certification of expenditure;
3.
adequate resources for each body or department to carry out the functions which have been allocated to it throughout the period of implementation of actions financed by the Fund;
4.
effective internal control arrangements in the Responsible Authority and any delegated authority;
5.
reliable accounting, monitoring and financial reporting systems which shall be in computerised form;
6.
an effective system of reporting and monitoring where the performance of tasks is delegated;
7.
the existence of detailed manuals of procedures in relation to the functions to be performed;
8.
effective arrangements for the audit of the functioning of the system;
9.
systems and procedures to ensure a sufficient audit trail;
10.
reporting and monitoring procedures for irregularities and of recovery of amounts unduly paid.
Article 4
Designation of authorities
1. The Member State shall designate the following:
-
a Responsible Authority,
-
a Certifying Authority,
-
a Control Authority.
2. The Member State shall lay down all the arrangements governing its relations with the said authorities. Without prejudice to the provisions of this Decision, the Member State lays down all the arrangements governing the relations between the said authorities, which shall act in full compliance with the institutional, legal and financial systems of the Member State concerned.
3. Without prejudice to the provisions of Article 3, point (2), some or all of the management, certification and control functions may be implemented within the same body.
Article 5
Responsible Authority
1. The Responsible Authority shall be responsible for the management and the implementation of multi-annual and annual programmes supported by the Fund in an efficient, effective and correct way, and in particular for:
(a)
submitting to the Commission the multi-annual programme in accordance with the model defined in Annex 1;
(b)
submitting to the Commission the annual programme in accordance with the model defined in Annex 2;
(c)
ensuring that projects are selected for funding in accordance with the conditions and criteria laid down in articles 14 and 20 of Decision 2004/904/EC and in compliance with the standard procedures set out in Article 10 of this Decision, without prejudice to additional criteria as defined in applicable Community and national rules;
(d)
ensuring an efficient administrative, contractual and financial management of actions, in compliance with the standard procedures set out in Article 11 of this Decision;
(e)
ensuring the legality and regularity of the transactions.
2. The Responsible Authority shall set up procedures to ensure that all documents regarding expenditure and checks required for a sufficient audit trail are held in accordance with the requirements of Article 9.
3. The Responsible Authority shall ensure that the Control Authority receives, for the purposes of carrying out the checks defined in Article 25, paragraph 1 (a) of Decision 2004/904/EC, all necessary information on management procedures operated and the projects co-financed by the Fund.
4. The Responsible Authority shall ensure that the Certifying Authority receives, for the purpose of its tasks, all necessary information on the management procedures operated, the projects co-financed by the Fund and the results of the controls carried out by the Control Authority.
5. The Responsible Authority shall receive the payments made by the Commission, and be responsible for making payments to the beneficiaries. It shall submit to the Commission the requests for payment drawn up in accordance with Annex 5, accompanied, where relevant, by the progress or final report for which models are provided in Annexes 3 and 4, and by the declaration of expenditure drawn-up in accordance with Annex 6, duly certified by the Certifying Authority.
6. The Responsible Authority shall ensure that reports on the implementation and evaluation of actions co-financed by the Fund are carried out in accordance with the timetable defined in article 28 of Decision 2004/904/EC.
Article 6
Delegation of tasks by the Responsible Authority
Where all or some of the Responsible Authority's tasks are delegated to a Delegated Authority, the Responsible Authority shall define precisely the scope of the tasks delegated, and set out detailed procedures for the implementation of the delegated tasks, which shall comply with the conditions laid down in Article 3.
These procedures shall include supplying the Responsible Authority with regular information on the effective performance of the delegated tasks and a description of the means deployed.
The tasks that are delegated by the Responsible Authority shall be communicated to and acknowledged by the Delegated Authority.
Article 7
Control Authority
1. The Control Authority shall be responsible for ensuring the organisation of checks defined in Article 25, paragraph 1(a) of Decision 2004/904/EC in accordance with international standards.
2. The checks referred to in paragraph 1 shall cover a material sample of the co-financed projects, selected on the basis of a risk analysis, and representing at least 10 % of the total eligible expenditure for each annual programme. The sampling method shall take into account the following requirements:
(a)
include an appropriate mix of types and sizes of projects;
(b)
take account of any risk factors which have been identified by national or Community controls and the cost benefit aspects, taking into account controls carried out previously;
(c)
ensure that the sampling method employed for the checks defined in Article 25 selects projects which are representative of the underlying population in each annual programme.
3. When carrying out checks, the Control Authority shall verify the following:
(a)
the effective application of the management and control systems and the possible shortcomings and their seriousness;
(b)
the presence of a sufficient audit trail;
(c)
for an adequate number of accounting records, the correspondence of those records with the supporting documents kept by the responsible authority or any delegated body, the beneficiaries of grants and, where appropriate, the other organisations or firms involved in project implementation;
(d)
that the expenditure items correspond to the eligibility requirements as set in Commission Decision C(2006)51 final/1, to the requirements specified during the national selection procedure, to the terms of the grant agreement or other legal instrument granting the subsidy and to the works actually executed;
(e)
that the use or intended use of the project is consistent with the objectives set out in Articles 4 to 7 of Decision 2004/904/EC and benefits the target population defined in Article 3 of Decision 2004/904/EC;
(f)
that the Community financial contributions comply with the conditions provided for in Article 20 of Decision 2004/904/EC or in any other applicable Community provisions and are paid to beneficiaries without any reductions or delays;
(g)
that the appropriate co-financing has in fact been made available.
4. The final report on the implementation of the annual programme defined in Article 28, paragraph 2 of Decision 2004/904/EC shall include the results of all checks carried out by the Control Authority and a description of actions taken by the Responsible Authority with regard to the anomalies or irregularities discovered.
Article 8
Certifying authority
The Certifying Authority shall be responsible for certifying the statements of expenditure drawn up by the Responsible Authority in accordance with Article 24 of Decision 2004/904/EC, following the model provided in Annex 6.
The certification shall provide assurance that:
1.
the statement of expenditure is accurate and results from reliable accounting systems and is based on verifiable supporting documents;
2.
the expenditure declared complies with applicable Community and national rules and has been incurred in respect of projects selected for funding in accordance with the criteria applicable to the annual programme and complying with the applicable Community and national rules;
3.
for the purposes of certification, the Certifying Authority has received adequate information from the Responsible Authority on the management procedures operated, the projects co-financed by the Fund and the controls carried out in relation to expenditure included in statements of expenditure;
4.
the results of all audits carried out by the Control Authority have been duly taken into account;
5.
the recovery of any amounts of Community funds found to have been unduly paid as a result of irregularities detected, together with interest where appropriate has been duly deducted from the declaration of expenditure.
Article 9
Audit Trail
1. Member States' management and control systems shall provide an adequate audit trail.
2. An audit trail shall be considered sufficient where it permits:
(a)
reconciliation of certified declarations of expenditure submitted to the Commission with the individual expenditure records and supporting documents kept at the various administrative levels of the Responsible Authority and any Delegated Authority, and by the final beneficiaries;
and
(b)
verification of the allocation and transfers of the Community funding granted under the Fund as well as of sources of co-financing of the project.
3. The Responsible Authority shall introduce procedures to ensure that a record is kept of the location of all documents relating to particular payments made under the European Refugee Fund, and that the documents can be produced for inspection if requested by:
(a)
the Control Authority;
(b)
the Certifying Authority;
(c)
the officials and authorised representatives of the Commission, including the European Anti-Fraud Office (OLAF), and the European Court of Auditors.
4. For a period of five years following the payment by the Commission of the final balance in respect of each annual programme, the Responsible Authority shall keep available for the Commission, the European Anti-Fraud Office (OLAF) and the European Court of Auditors all the supporting documents, i.e. the originals or versions certified to be in conformity with the originals on commonly accepted data carriers, regarding expenditure and checks on the project concerned. This period shall be interrupted in the case of legal proceedings or at the duly motivated request of the Commission.
CHAPTER III
RULES FOR THE ADMINISTRATIVE AND FINANCIAL MANAGEMENT OF PROJECTS BY THE RESPONSIBLE AUTHORITY
Article 10
Selection and award procedures
The Responsible Authority shall lay down detailed procedures for the selection of actions to be co-financed by the Fund, covering inter alia:
(a)
organisation of the selection and award procedures in compliance with the principles of transparency and equal treatment, and, where applicable, with applicable public procurement rules, and taking all necessary measures to avoid any possible conflict of interest;
(b)
advertising of calls for proposals and calls for tenders via the suitable channels at national and regional level;
(c)
receipt of applications, acknowledgement of receipt, registration and filing of applications for co-financing;
(d)
formal, qualitative and budgetary analysis and assessment of applications using the criteria defined in the calls for proposals or calls for tender;
(e)
organisation of meetings and liaison with selection or evaluation panels;
(f)
consultations with relevant bodies as regards complementarity of the proposed actions with other regional, national and Community financial instruments;
(g)
adoption of the decision on selection of projects at an appropriate level of the Responsible Authority;
(h)
publication of the results of the selection and award procedure;
(i)
written information to each applicant on the results of the selection process containing an explanation relating to the selection decisions.
Article 11
Procedures for the administrative, contractual and financial management of actions
1. The Responsible Authority shall lay down detailed procedures for the management of actions, covering inter alia:
(a)
the signature of contracts, grant agreements or any equivalent form of legal instrument with selected beneficiaries;
(b)
follow-up of agreements and any amendments thereto by establishing a system for the administrative monitoring of projects (exchange of correspondence, issue and monitoring of amendments and reminder letters, receipt and processing of reports, etc.);
(c)
analysis of activity reports and financial reports on the projects, verification of the delivery of the products and services co-financed including, where appropriate, on the spot verifications;
(d)
verification of the reality of expenditure declared for projects and the eligibility of such expenditure with the conditions laid down in Decision C(2006)51 final/1 and national rules;
(e)
conditions for receiving, verifying and endorsing requests for payment, authorising and paying expenses and entering them in the accounts;
(f)
recovery of unused funds or funds used by the beneficiaries for ineligible expenditure.
2. The contracts or grant agreements referred to in paragraph 1(a) shall define inter alia:
(a)
the amount of the grant and the maximum percentage with regard to the eligible and total costs of the project;
(b)
a detailed description and timetable of the supported project;
(c)
the agreed forward budget and financing plan for the project;
(d)
the timetable and provisions for implementation of the agreement (reporting obligations, amendments, termination, …);
(e)
a definition of eligible costs;
(f)
conditions relating to the payment of the grant and bookkeeping requirements.
3. The Responsible Authority shall establish a system to record and maintain in a computerised form detailed accounting records on each project under the annual programmes, and shall provide for adequate data collection on implementation of the projects for the purposes of financial management, monitoring, control and evaluation.
CHAPTER IV
CONTROL
Article 12
Responsibilities of the Member States
1. Member States shall be responsible for ensuring sound financial management of actions financed by the Fund and the legality and regularity of underlying transactions. They shall ensure that Responsible Authorities, including any Delegated Authority, Certifying Authorities, Control Authorities and any other bodies concerned receive adequate guidance on the provision of management and control systems which ensure that Community funds are used efficiently and correctly.
2. The Member States shall ensure that management and control systems have been set up in accordance with the requirements in Articles 3 to 11. They shall be responsible for ensuring that the systems function effectively throughout the period of implementation of actions financed by the Fund.
3. When presenting the proposal for the annual programme 2005, the Member States shall submit to the Commission a description of the systems covering the organisation and procedures of the Responsible Authority and any Delegated Authority, as well as the Certifying and Control Authorities, in accordance with the requirements laid down in Articles 3 to 11.
4. Member States shall provide an updated description of management and control systems whenever substantial changes are made to the systems and procedures.
Article 13
Responsibilities of the Commission
1. Within 12 months of receiving the description provided for in Article 12, paragraph 3, the Commission shall carry out a documentary analysis of the management and control systems set up by the Member State, as well as an on the spot check of the implementation procedures, control systems, accounting procedures and the procurement and grant allocation procedures followed by the Responsible Authority and any Delegated Authority. The Commission shall inform the Member State of any shortcomings or deficiencies found in the systems and of corrective measures required.
2. Without prejudice to the provisions of Article 26 of Council Decision 2004/904/EC, the Commission shall review the procedures or systems set up by the Member States whenever substantial changes are made.
Article 14
Cooperation with the Control Authorities of the Member States
1. The Commission shall cooperate with the control authorities designated by the Member States to coordinate their respective control plans and audit methods and shall immediately exchange the results of the audits carried out on management and control systems in order to make the best possible use of control resources and to avoid unjustified duplication of work.
2. The Commission and the Control Authorities shall meet on a regular basis, and at least once a year, in order to examine together results of controls included in the annual reports presented under Article 28, paragraph 2 of Decision 2004/904/EC, and to exchange views on other issues relating to the improvement of the management and control systems.
CHAPTER V
ARRANGEMENTS FOR USING THE EURO
Article 15
Multiannual and annual programmes
1. Draft multi-annual and annual programmes referred to in Article 16 of Decision 2004/904/EC shall be submitted to the Commission in euro.
2. Member States which do not have the euro as their currency on the date of submission of the draft multiannual or annual programme shall present the financial information contained in Annexes 1 and 2 to this decision both in euro and in national currency. The exchange rate used for the conversion of national currency in euro is the daily rate published in the C series of the Official Journal of the European Union on the last working day of the month preceding the month in which the draft multiannual or annual programme is submitted to the Commission.
Article 16
Reports, declarations of expenditure and requests for payments.
1. Progress reports, final implementation reports, declarations of expenditure and requests for payment referred to in Decision 2004/904/EC shall be submitted to the Commission in euro.
2. Member States which do not have the euro as their currency on the date of submission of the reports may submit the financial information contained in Annexes 3, 4, and 6 both in national currency and euro. In this case the exchange rate used for the conversion of national currency in euro for expenditure incurred in national currency shall be the daily rate published in the Official Journal of the European Union on the last working day of the month preceding the month in which the expenditure was recorded in the accounts of the Responsible Authority.
3. When the euro becomes the currency of a Member State that has implemented the conversion procedure set out in the preceding paragraph, that conversion procedure shall continue to apply to all expenditure recorded in the accounts by the Responsible Authority before the date of entry into force of the fixed conversion rate between the national currency and the euro.
CHAPTER VI
CLEARANCE OF ACCOUNTS
Article 17
Clearance of accounts
1. Within nine months of the end date of eligibility of costs defined in the annual decision on co-financing by the Fund, the Responsible Authority shall submit to the Commission the following documents:
(a)
the final report on the implementation of the annual programme drawn-up in accordance with the model defined in Annex 4;
(b)
the final declaration of expenditure drawn up in accordance with the model defined in Annex 6, certified by the Certifying Authority;
(c)
the report drawn up by the Control Authority on the checks carried out.
(d)
a request for payment or declaration of reimbursement due drawn-up in accordance with the model in Annex 5.
2. The nine months period referred to in paragraph 1 shall be interrupted if the Commission has adopted a decision suspending payments of the co-financing for the relevant annual programme in accordance with the provisions of Article 26, paragraph 2 of Decision 2004/904/EC. The period shall start to run again from the date when the Commission decision referred to in Article 26, paragraph 3 of Decision 2004/904/EC has been notified to the Member State.
3. Without prejudice to the provisions of Article 26 of Decision 2004/904/EC, the Commission shall, within 6 months of receiving the documents referred to in paragraph 1, inform the Member State of the amount of expenditure recognised as chargeable to the Fund, and of any financial corrections deriving from the difference between declared expenditure and expenditure recognised as chargeable to the budget. The Member State shall have three months to present its comments.
4. Within three months of receiving the Member State’s comments, the Commission shall decide on the amount of expenditure recognised as chargeable to the Fund, and recover the balance arising from the difference between final recognised expenditure and the sums already paid to the Member States.
5. Should the Responsible Authority fail to provide the documents required in paragraph 1 by the due date and in an acceptable format, the Commission shall automatically cancel the co-financing of the Fund for the period covered by the co-financing decision, issue a recovery order for all the sums already paid as pre-financing under the co-financing decision and decommit all related outstanding amounts.
6. The automatic cancellation procedure defined in paragraph 5 shall be suspended, for the amount of the projects concerned, where legal proceedings or administrative appeal having suspensory effects are ongoing at Member State level at the time of submission of the documents defined in paragraph 1. The Member State shall, in the partial final report submitted, give detailed information on such projects, and send reports on progress made with regard to these projects every 6 months. Within 3 months of the conclusion of the legal proceedings or administrative appeal procedure, the Member State shall present the documents required in paragraph 1 for the projects concerned.
CHAPTER VII
FINAL PROVISIONS
Article 18
Final provisions
Member States may apply national rules on control that are more rigorous than those prescribed in this Decision.
Article 19
The present decision is addressed to the Kingdom of Belgium, the Czech Republic, the Federal Republic of Germany, the Republic of Estonia, the Hellenic Republic, the Kingdom of Spain, the French Republic, Ireland, the Italian Republic, the Republic of Cyprus, the Republic of Latvia, the Republic of Lithuania, the Grand Duchy of Luxembourg, the Republic of Hungary, the Republic of Malta, the Kingdom of the Netherlands, the Republic of Austria, the Republic of Poland, the Portuguese Republic, the Republic of Slovenia, the Slovak Republic, the Republic of Finland, the Kingdom of Sweden, the United Kingdom of Great Britain and Northern Ireland.
Done at Brussels, 20 January 2006.