COMMISSION DECISION
of 5 March 2008
laying down rules for the implementation of Decision No 574/2007/EC of the European Parliament and of the Council establishing the External Borders Fund for the period 2007 to 2013 as part of the General programme ‘Solidarity and Management of Migration Flows’ as regards Member States' management and control systems, the rules for administrative and financial management and the eligibility of expenditure on projects co-financed by the Fund
(notified under document number C(2008) 789)
(Only the Bulgarian, Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Italian, Latvian, Lithuanian, Maltese, Polish, Portuguese, Romanian, Slovak, Slovenian, Spanish and Swedish texts are authentic)
(2008/456/EC)
THE COMMISSION OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Community,
Having regard to Decision No 574/2007/EC of the European Parliament and of the Council of 23 May 2007 establishing the External Borders Fund for the period 2007 to 2013 as part of the General programme ‘Solidarity and Management of Migration Flows’ (1), in particular Articles 25, 33(5), 35(6) and 37(4) thereof,
Whereas:
(1)
It is necessary to lay down the conditions under which Member States should implement the action under the Fund, in particular to identify under which circumstances the responsible authority may implement projects directly. Further provisions should also be laid down for delegated authorities.
(2)
It is necessary to identify a list of procedures and/or practical arrangements that the different designated authorities should lay down and follow for implementation of the Fund.
(3)
It is necessary to lay down the obligations which the responsible authorities should have with regard to final beneficiaries in the phase leading to selection and approval of the projects to be funded and with regard to the aspects which should be covered by the verifications of the expenditure declared by the final beneficiary and/or by the partners in the project, including administrative verifications of the applications for reimbursement and on-the-spot verifications of individual projects.
(4)
In order to ensure that expenditure under annual programmes can be properly audited, it is necessary to set out the criteria with which audit trails should comply in order to be considered adequate.
(5)
The audits of projects and of systems are carried out under the responsibility of the audit authority. To ensure that the audits offer adequate scope and effectiveness and are carried out in accordance with the same standards in all Member States, it is necessary to set out the conditions which the audits should fulfil, including the basis for sampling.
(6)
The Member States must submit to the Commission, together with their multiannual programme, a description of their management and control systems. Since this document is one of the principal bases on which the Commission relies, in the context of shared management of the Community budget, to determine whether the financial assistance concerned is used by the Member States in accordance with the applicable rules and principles for protecting the Community's financial interests, it is necessary to set out in detail the information that this document should contain.
(7)
In order to harmonise standards for programming, following up the implementation of the Fund, auditing and certifying expenditure, it is necessary to clearly define the contents of the multiannual programme, the annual programme, the progress report, the final report, the applications for payments as well as the audit strategy, the annual audit report, the declaration of validity and the certification of expenditure.
(8)
Since Member States are required to report and monitor irregularities and to recover sums wrongly paid in connection with the financing from the Fund, it is necessary to define requirements for the data sent to the Commission.
(9)
Experience has shown that citizens of the European Union are insufficiently aware of the role played by the Community in funding programmes. It is therefore appropriate to define in detail the information and publicity measures necessary to bridge this communication and information gap.
(10)
In order to guarantee that information on possible funding opportunities is disseminated widely to all interested parties and for the sake of transparency, the minimum measures needed to inform potential final beneficiaries about the financing opportunities offered jointly by the Community and the Member States through the Fund should be set out. In order to enhance transparency about use of the Fund, the list of final beneficiaries, the names of the projects and the amount of public funding allocated to projects should be published.
(11)
In the light of Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data (2) and Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 on the protection of individuals with regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data (3), it is necessary to provide, in relation to the information and publicity measures and audit work under this Decision, that the Commission and the Member States should prevent any unauthorised disclosure of or access to personal data and to specify the purpose for which the Commission and the Member States may process such data.
(12)
Use of electronic means to exchange information and financial data between the Member States and the Commission leads to simplification, increased efficiency, transparency and time savings. In order to capitalise fully on these advantages while preserving the security of exchanges, a common computer system may be established by the Commission.
(13)
To ensure efficient implementation of the Fund in the Member States, in accordance with the principles of sound financial management, a series of common rules should be adopted on the eligibility of expenditure from the Fund. In order to reduce the administrative burden on final beneficiaries and designated authorities, flat rates for indirect costs should be eligible under certain conditions.
(14)
It is necessary to lay down detailed rules for the implementation of the support to the Special Transit Scheme established by Council Regulation (EC) No 693/2003 (4) and Council Regulation (EC) No 694/2003 (5).
(15)
In accordance with Articles 1 and 2 of the Protocol on the position of Denmark, annexed to the Treaty on European Union and the Treaty establishing the European Community, Denmark is not bound by the present Decision or subject to its application. Given that Decision No 574/2007/EC builds upon the Schengen acquis under the provisions of Title IV of Part Three of the Treaty establishing the European Community, Denmark shall, in accordance with Article 5 of the said Protocol, decide within a period of six months after the date of adoption of that Decision whether it will implement it in its national law.
(16)
This Decision constitutes a development of the provisions of the Schengen acquis in which the United Kingdom does not take part, in accordance with Council Decision 2000/365/EC of 29 May 2000 concerning the request of the United Kingdom of Great Britain and Northern Ireland to take part in some of the provisions of the Schengen acquis (6) and the subsequent Council Decision 2004/926/EC of 22 December 2004 on the putting into effect of parts of the Schengen acquis by the United Kingdom of Great Britain and Northern Ireland (7). The United Kingdom is therefore not bound by it or subject to its application.
(17)
This Decision constitutes a development of the provisions of the Schengen acquis in which Ireland does not take part, in accordance with Council Decision 2002/192/EC of 28 February 2002 concerning Ireland's request to take part in some of the provisions of the Schengen acquis (8). Ireland is therefore not bound by it or subject to its application.
(18)
As regards Iceland and Norway, Decision No 574/2007/EC constitutes a development of provisions of the Schengen acquis within the meaning of the Agreement concluded by the Council of the European Union and the Republic of Iceland and the Kingdom of Norway concerning the association of those two States with the implementation, application and development of the Schengen acquis (9), which fall within the areas referred to in Article 1, points A and B of Council Decision 1999/437/EC of 17 May 1999 on certain arrangements for the application of the Agreement concluded by the Council of the European Union and the Republic of Iceland and the Kingdom of Norway concerning the association of those two States with the implementation, application and development of the Schengen acquis (10).
(19)
As regards Switzerland, Decision No 574/2007/EC constitutes a development of the provisions of the Schengen aquis within the meaning of the Agreement signed by the European Union, the European Community and the Swiss Confederation on the latter's association with the implementation, application and development of the Schengen acquis which fall within the areas referred to in Article 4(1) of the Council decision (11) on the signing, on behalf of the European Community, and on the provisional application of certain provisions of this Agreement.
(20)
The measures provided for in this Decision are in accordance with the opinion of the Management Committee of the Fund,
HAS ADOPTED THIS DECISION:
TABLE OF CONTENTS
Part I
Introduction
Chapter I
Subject and definitions
Article 1
Subject matter
Article 2
Definitions
Part II
Provisions common to the four Funds
Chapter 1
Designated authorities
Article 3
Common authorities
Article 4
Delegated authority
Article 5
Outsourcing of tasks
Chapter 2
Management and control systems
Article 6
Manual of procedures
Article 7
Implementation of the Fund by the responsible authority
Article 8
Conditions under which the responsible authority acts as executing body
Article 9
Selection and award procedure when the responsible authority acts as awarding body
Article 10
Grant agreements with final beneficiaries when the responsible authority acts as awarding body
Article 11
Implementation contracts
Article 12
Determination of the final Community contribution
Article 13
Technical assistance
Article 14
Technical assistance expenditure in the case of a common authority
Article 15
Verifications by the responsible authority
Article 16
Audit trail
Article 17
Audits of systems and audits of projects
Article 18
Verifications by the certifying authority
Chapter 3
Information to be provided regarding use of the Fund
Article 19
Principle of proportionality
Article 20
Description of management and control systems
Article 21
Revision of the description of management and control systems
Article 22
Programming documents
Article 23
Revision of financial breakdown in annual programmes
Article 24
Progress and final reports on implementation of annual programmes
Article 25
Documents established by the audit authority
Article 26
Documents established by the certifying authority
Chapter 4
Reporting irregularities
Article 27
Initial reporting - derogations
Article 28
Reporting of follow-up - non-recovery
Article 29
Contacts with Member States
Article 30
Use of information
Chapter 5
Information and publicity
Article 31
Information for potential final beneficiaries
Article 32
Information for final beneficiaries
Article 33
Responsibilities of the responsible authority relating to information and publicity for the general public
Article 34
Responsibilities of final beneficiaries relating to information and publicity for the general public
Article 35
Technical characteristics of information and publicity for the operation
Chapter 6
Personal data
Article 36
Protection of personal data
Chapter 7
Electronic exchange of documents
Article 37
Electronic exchange of documents
Article 38
Computer system for the exchange of documents
Part III
Provisions specific to the External Borders Fund
Chapter 1
Eligibility rules
Article 39
Eligibility rules
Chapter 2
Special Transit Scheme
Article 40
Support for the implementation of the Special Transit Scheme
Part IV
Final provisions
Article 41
Addressees
ANNEXES
PART I
INTRODUCTION
CHAPTER I
Subject and definitions
Article 1
Subject matter
1. This Decision lays down rules for implementation of the Fund as regards:
(a)
designated authorities;
(b)
management and control systems;
(c)
information to be provided by the Member States to the Commission regarding use of the Fund;
(d)
reporting of irregularities;
(e)
information and publicity;
(f)
personal data;
(g)
electronic exchange of documents.
2. The provisions set out below shall apply without prejudice to Council Regulation (Euratom, EC) No 2185/96 of 11 November 1996 concerning on-the-spot checks and inspections carried out by the Commission in order to protect the European Communities' financial interests against fraud and other irregularities (12).
Article 2
Definitions
For the purposes of this Decision the following definitions shall apply:
-
‘basic act’: Decision No 574/2007/EC,
-
‘Fund’: the External Borders Fund, as established by the basic act,
-
‘four Funds’: the European Refugee Fund, the External Borders Fund, the European Return Fund and the European Fund for the Integration of third-country nationals, as established by Decision No 573/2007/EC (13), Decision No 574/2007/EC and Decision No 575/2007/EC (14) of the European Parliament and of the Council and Council Decision 2007/435/EC (15) as part of the General programme ‘Solidarity and Management of Migration Flows’,
-
‘responsible authority’: the body designated by a Member State under Article 27(1)(a) of the basic act,
-
‘certifying authority’: the body designated by a Member State under Article 27(1)(b) of the basic act,
-
‘audit authority’: the body designated by a Member State under Article 27(1)(c) of the basic act,
-
‘delegated authority’: the body designated by a Member State under Article 27(1)(d) of the basic act,
-
‘designated authorities’: all the authorities designated by a Member State under Article 27 of the basic act,
-
‘action’: action under the Fund, as those being listed under the specific objectives defined in Article 4 and as defined in Article 6 of the basic act,
-
‘project’: specific, practical means deployed to implement all or part of an action by the final beneficiaries of grants,
-
‘final beneficiary’: the legal entity responsible for implementing projects such as NGOs, federal, national, regional or local authorities, other non-profit organisations, private or public-law companies or international organisations,
-
‘partner in the project’: any legal entity which implements a project in cooperation with a final beneficiary by providing the project with resources and by receiving part of the Community contribution through the final beneficiary,
-
‘strategic guidelines’: the framework for intervention by the Fund, as adopted by Commission Decision 2007/599/EC (16),
-
‘priority’: set of actions defined as a priority in the strategic guidelines,
-
‘specific priority’: set of actions defined as a specific priority in the strategic guidelines, allowing co-financing at a higher rate, in accordance with Article 16(4) of the basic act,
-
‘primary administrative or judicial finding’: first written assessment by a competent authority, either administrative or judicial, concluding on the basis of specific facts that an irregularity has been committed, without prejudice to the possibility that this conclusion may subsequently have to be revised or withdrawn as a result of developments in the course of the administrative or judicial procedure,
-
‘irregularity’: any infringement of a provision of Community law resulting from an act or omission by an economic operator which has, or would have, the effect of prejudicing the general budget of the European Union by charging an unjustified item of expenditure to the general budget,
-
‘suspected fraud’: an irregularity giving rise to the initiation of administrative or judicial proceedings at national level in order to establish the presence of intentional behaviour, in particular fraud, as referred to in point (a) of Article 1(1) of the Convention drawn up on the basis of Article K.3 of the Treaty on European Union, on the protection of the European Communities' financial interests (17),
-
‘bankruptcy’: insolvency proceedings, as defined in Article 2(a) of Council Regulation (EC) No 1346/2000 (18),
-
‘grant agreement’: an agreement or an equivalent form of legal instrument on the basis of which Member States provide grants to the final beneficiary for the purpose of implementing the project under the Fund.
PART II
PROVISIONS COMMON TO THE FOUR FUNDS
CHAPTER 1
Designated authorities
Article 3
Common authorities
Member States may designate the same responsible authority, audit authority or certifying authority for two or more of the four Funds.
Article 4
Delegated authority
1. Any delegation of tasks shall comply with the principle of sound financial management, which requires effective and efficient internal control, and shall ensure compliance with the principle of non-discrimination and the visibility of Community funding. No implementing tasks delegated may give rise to conflicts of interest.
2. The scope of the tasks delegated by the responsible authority to the delegated authority and the detailed procedures for implementation of the delegated tasks shall be formally recorded in writing.
The act of delegation shall mention at least:
(a)
the references of the relevant Community legislation;
(b)
the task entrusted to the delegated authority;
(c)
the rights and duties of the delegated authority and the responsibilities it assumes;
(d)
the obligation for the delegated authority to put in place and to maintain an organisational structure and a management and control system adapted to performance of its duties;
(e)
the assurance to be provided concerning sound financial management and the legality and regularity of the delegated tasks.
3. The handling of communication with the Commission referred to in Article 27(1)(a) of the basic act shall not be delegated. The delegated authority shall communicate with the Commission via the responsible authority.
4. If the delegated authority is not a public administration or a body governed by the private law of the Member State which has a public-service mission, the responsible authority may not delegate to that authority any executive powers which involve a large measure of discretion implying political choices.
5. Delegation of tasks to the delegated authorities shall not affect the liability of the responsible authority, which shall remain answerable for the tasks it has delegated.
6. Where the responsible authority has delegated tasks to the delegated authority, all provisions of this Decision relating to the responsible authority shall apply mutatis mutandis to the delegated authority.
Article 5
Outsourcing of tasks
Designated authorities may outsource some of their tasks but they shall remain answerable for the outsourced tasks in accordance with the responsibilities defined in Articles 29, 31 and 32 of the basic act.
CHAPTER 2
Management and control systems
Article 6
Manual of procedures
In accordance with Article 33(2) of the basic act and having regard to the principle of proportionality, Member States shall establish a manual setting out procedures and practical arrangements regarding:
(a)
functioning of the designated authorities;
(b)
arrangements ensuring appropriate separation of functions;
(c)
where appropriate, monitoring of delegated authorities and other outsourced tasks;
(d)
establishment of multiannual and annual programmes;
(e)
establishment of audit strategy and annual audit plans;
(f)
selection of projects, award of grants and monitoring and financial management of the projects;
(g)
management of irregularities, financial corrections and recoveries;
(h)
preparation and implementation of audit missions;
(i)
preparation of audit reports and declarations;
(j)
certification of expenditure;
(k)
evaluation of the programme;
(l)
reporting to the Commission;
(m)
audit trail.
Article 7
Implementation of the Fund by the responsible authority
1. For implementation of the Fund, the responsible authority may act as awarding body and/or as executing body.
2. The responsible authority acts as awarding body in cases where it implements the projects, as a general rule, on the basis of annual open calls for proposals.
Neither the responsible authority nor any delegated authority may apply in response to these calls for proposals.
In duly justified cases, including continuation of multiannual projects in accordance with Article 16(6) of the basic act which were selected after a previous call for proposals or in emergency situations, grants may be awarded without a call for proposals.
3. The responsible authority acts as executing body in cases where it decides to implement the projects directly because the characteristics of the projects leave no other choice for implementation, such as de jure monopoly situations or security reasons. In these cases, the rules concerning the final beneficiary shall apply mutatis mutandis to the responsible authority.
Article 8
Conditions under which the responsible authority acts as executing body
1. The reasons which led the responsible authority to act as executing body for implementation of projects shall be identified and communicated to the Commission within the framework of the annual programme concerned.
2. When implementing the projects, the responsible authority shall ensure the principle of value for money and prevent conflicts of interest.
3. The responsible authority may implement the projects identified in accordance with Article 7(3) directly and/or in association with any national authority competent on account of its technical expertise, its high degree of specialisation or its administrative powers. The main national authorities involved in implementation shall also be identified in the annual programme concerned.
4. The administrative decision to co-finance a project under the Fund shall contain the information necessary to monitor the co-financed products and services and to check the expenditure incurred. All relevant provisions laid down for a grant agreement in Article 10(2) shall be specified in an equivalent form of legal instrument.
5. The final report on implementation of the annual programme shall include information on the procedures and practices applied to ensure adequate separation of functions, effective control and satisfactory protection of the European Communities' financial interests and shall provide explanations on how conflicts of interest have been avoided.
6. When the responsible authority is expected to be executing body on a regular basis for projects co-financed by the Fund:
(a)
the audit authority shall not be part of the same body as the responsible authority, except when its audit independence is guaranteed and it also reports to another body outside the body of which it and the responsible authority form part;
(b)
the tasks of the responsible authority, as defined in Article 29 of the basic act, shall not be affected when the responsible authority also implements projects directly.
7. When a delegated authority is expected to be executing body for projects co-financed by the Fund, this delegated authority may not be the sole final beneficiary of the appropriations which it was delegated to manage.
Article 9
Selection and award procedure when the responsible authority acts as awarding body
1. The calls for proposals defined in Article 7(2) shall be published in a way that ensures maximum publicity among potential beneficiaries. Any change to the content of the calls for proposals shall also be published under the same conditions.
The calls for proposals shall specify:
(a)
the objectives;
(b)
the selection criteria, which shall comply with Article 16(5) of the basic act, and the relevant supporting documents;
(c)
the arrangements for Community and, if applicable, national financing;
(d)
the arrangements and final date for submission of proposals.
2. For the purposes of selection of projects and award of grants, the responsible authority shall ensure that potential beneficiaries are informed of the following specific conditions concerning the projects to be implemented:
(a)
the eligibility rules for the expenditure;
(b)
the time-limit for implementation; and
(c)
the financial and other information to be kept and communicated.
Before the award decision is taken the responsible authority shall satisfy itself that the final beneficiary and/or the partners in the project have the capacity to fulfil these conditions.
3. The responsible authority shall ensure that projects awarded grants have been subject to a formal, technical and budgetary analysis and qualitative assessment applying the criteria laid down in the call for proposals. The reasons for rejection of the other projects shall be recorded.
4. Member States shall determine who shall have the power to award projects and shall ensure that conflicts of interest are avoided in all cases and, in particular, when the applicants are national bodies.
5. The award decision shall indicate at least the name of the final beneficiary and/or of the partners in the project, the essential details of the project and its operational objectives, the maximum amount of co-financing from the Fund and the maximum rate of co-financing of the total eligible costs.
6. Written information shall be sent to each applicant on the results of the selection process containing an explanation of the selection decisions. If provided for in national legislation, the relevant review procedure shall be mentioned.
Article 10
Grant agreements with final beneficiaries when the responsible authority acts as awarding body
1. The responsible authority shall lay down detailed project management procedures covering, inter alia:
(a)
signature of grant agreements with selected final beneficiaries;
(b)
follow-up of agreements and any amendment thereto by establishing a system for administrative monitoring of projects (exchange of correspondence, issuing and monitoring amendments and reminder letters, receipt and processing of reports, etc.).
2. The grant agreements shall lay down, inter alia:
(a)
the maximum amount of the grant;
(b)
the maximum percentage of the Community contribution in accordance with Article 16(4) of the basic act;
(c)
a detailed description and timetable of the project supported;
(d)
if applicable, the part of the tasks and related costs that the final beneficiary intends to subcontract to third parties;
(e)
the agreed forward budget and financing plan for the project, including the fixed percentage of indirect costs as defined in Annex XI regarding the rules on eligibility of expenditure;
(f)
the timetable and provisions for implementation of the agreement (reporting obligations, amendments and termination);
(g)
the operational objectives of the project and the indicators to be used;
(h)
the definition of eligible costs;
(i)
the conditions relating to payment of the grant and bookkeeping requirements;
(j)
the conditions relating to audit trail;
(k)
the relevant provisions relating to data protection;
(l)
the relevant provisions relating to publicity.
3. If appropriate, the final beneficiaries shall ensure that all partners in the project are subject to the same obligations as them. The partners shall engage their responsibility through the final beneficiary which remains answerable, in last resort, for the respect of the contractual conditions by itself and all partners in the project.
The final beneficiaries shall keep certified copies of the accounting documents justifying income and expenditure incurred by the partners in relation to the project concerned.
4 The grant agreements shall provide expressly for the Commission and the Court of Auditors to exercise their powers of control, based on documents and on the premises, over all final beneficiaries, partners in the project and subcontractors.
Article 11
Implementation contracts
Without prejudice to the applicable Community and national public procurement rules, the grant agreements shall lay down that, when implementing the projects, the final beneficiaries and/or the partners in the project shall award the procurement contract, following a tendering procedure, to the tender offering best value for money and that care be taken to avoid any conflict of interest. However, without prejudice to the applicable Community and national public procurement rules, contracts with a value of less than EUR 5 000 may be awarded on the basis of a single offer without a call for tender.
Article 12
Determination of the final Community contribution
For calculation of the final payment to the final beneficiary, the total Community contribution to each project shall be the lowest of the following three amounts:
(a)
the maximum amount stated in the grant agreement;
(b)
the maximum co-financing resulting from multiplication of the total eligible costs of the project concerned by the percentage laid down in Article 16(4) of the basic act (i.e. 50 % or 75 %); and
(c)
the amount resulting from application of the principle of non-profit, as defined in point I.3.3 of Annex XI.
Article 13
Technical assistance
1. Technical assistance at the initiative of the Commission, as defined in Article 17 of the basic act, may be financed up to 100 % by the Fund.
2. Technical assistance at the initiative of the Member States, as defined in Article 18 of the basic act, may be financed up to 100 % by the Fund.
3. Technical assistance at the initiative of the Commission or the Member States may take the form of procurement contracts, expert fees and/or any administrative expenditure subject to the eligibility rules defined in Part III, Chapter 1.
Article 14
Technical assistance expenditure in the case of a common authority
1. When one or more designated authorities are common to two or more of the four Funds, the appropriations for the technical assistance expenditure on each of the annual programmes concerned may be merged, partly or entirely.
2. The expenditure on technical assistance shall be allocated between the Funds concerned, preferably on the basis of simple and representative apportionment formulae. Application of the formulae shall not lead to any increase in the maximum amount of technical assistance expenditure on each annual programme concerned.
Article 15
Verifications by the responsible authority
1. The verifications to be carried out by, or under the responsibility of, the responsible authority under Article 29(1)(g) of the basic act shall cover administrative, financial, technical and physical aspects of projects, as appropriate.
The verifications shall ensure that the expenditure declared is real and justified for the purpose of the project, that the projects granted have been delivered in accordance with the grant agreements, that the Community contribution complies with the rules, in particular regarding the financing structure defined in Article 16 of the basic act, that the applications for reimbursement by the final beneficiary are correct and that the projects and expenditure comply with Community and national rules and avoid double-financing of expenditure with other Community or national schemes and with other programming periods.
Moreover, the verifications shall include:
(a)
administrative and financial verifications of each application for reimbursement sent by the final beneficiaries;
(b)
verifications, at least on a representative sample of the supporting documents covering all headings of the budget annexed to the grant agreement, of the relevance, accuracy and eligibility of the expenses, income and costs covered by assigned income declared by the final beneficiaries;
(c)
on-the-spot verifications of individual projects, at least on a sample representing an appropriate mix of types and sizes of projects and taking account of any risk factors already identified, in order to achieve reasonable assurance as to the legality and regularity of the underlying transactions, having regard to the level of risk identified by the responsible authority.
The verifications indicated in points (a) and (b) do not have to be carried out if an obligation is imposed on the final beneficiary to provide an audit certificate from an independent auditor which covers all the aspects mentioned in points (a) and (b).
2. Records shall be kept of each verification, stating the work performed, the date, the results and the measures taken in response to errors detected. The responsible authority shall ensure that all the supporting documents regarding the verifications performed are kept available for the Commission and the Court of Auditors for a period of five years following closure of the project. This period shall be interrupted in the event of legal proceedings or at the duly substantiated request of the Commission.
3. Where the responsible authority acts as executing body under the annual programme, as defined in Article 7(3), the verifications referred to in paragraph 1 shall be implemented in accordance with the principle of adequate separation of functions.
Article 16
Audit trail
1. For the purposes of Article 29(1)(k) of the basic act, an audit trail shall be considered adequate if it complies with the following criteria:
(a)
it permits reconciliation of the amounts certified to the Commission with the detailed accounting records and supporting documents held by the certifying authority, responsible authority, delegated authorities and final beneficiaries on projects co-financed under the Fund;
(b)
it permits verification of payment of the public contribution to the final beneficiary, of allocation and transfer of the Community funding granted under the Fund and of the sources of co-financing of the project;
(c)
it permits verification of application of the selection criteria established for the annual programme;
(d)
it contains in respect of each project, as appropriate, the technical specifications and financing plan, documents concerning grant approval, documents relating to public procurement procedures and reports on the verifications and audits carried out.
2. The responsible authority shall ensure that a record is kept of the location of all documents relating to specific payments made under the Fund.
Article 17
Audits of systems and audits of projects
1. The audits referred to in Article 32(1)(a) and (b) of the basic act shall be carried out on the management and control systems established by the Member States and on a sample of projects selected by a method approved by the audit authority.
The sampling method shall:
(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 of the verifications.
The sample shall also include projects implemented by the responsible authority acting as executing body at least on a proportional basis.
The method used to select the sample shall be documented.
2. The audit on the management and control systems shall cover each of the following processes at least once before 2013: programming, delegation of tasks, selection and award, monitoring of the projects, payment, certification of expenditure, reporting to the Commission, detection and treatment of potential irregularities and evaluation of the programmes.
3. The audits of projects shall be carried out on the spot on the basis of documentation and records held by the final beneficiary and/or the partners in the project. The audits shall verify that:
(a)
the project meets the selection criteria for the annual programme, has been implemented in accordance with the grant agreement and fulfils any applicable conditions concerning its functionality and use or the objectives to be attained;
(b)
the expenditure declared corresponds to the accounting records and supporting documents held by the final beneficiary and/or by the partners in the project, and those records correspond to the supporting documents kept by the responsible authority or any delegated body;
(c)
the items of expenditure correspond to the eligibility requirements set out in Annex XI, to the requirements specified during the national selection procedure, to the terms of the grant agreement and to the works actually carried out and, where appropriate, to other Community and national rules;
(d)
the use or intended use of the project is consistent with the objectives, action or measures set out in Articles 3, 4, 5, 6 and 18 of the basic act;
(e)
the public or private contribution has been paid to the final beneficiary in accordance with Article 16(2) of the basic act;
(f)
there is an adequate audit trail;
(g)
there are no conflicts of interest and good value for money has been achieved, in particular in cases where the responsible authority acts as executing body of the project.
4. Only expenditure within the scope of an audit carried out under paragraph 3 shall be counted towards the amount of expenditure audited for the purpose of Article 32(1)(b) of the basic act. If the audit is performed before the project has been closed, only the expenditure actually audited is taken into account to calculate the coverage rate.
5. Where problems detected appear to be systemic in nature and may therefore entail a risk to other projects, the audit authority shall ensure that further examination is carried out, including additional audits where necessary, to establish the scale of such problems. The necessary preventive and corrective measures shall be taken by the relevant authorities.
6. The audit authority shall draw conclusions on the basis of the results of the audits relating to expenditure declared to the Commission and shall communicate the conclusions to the Commission in the annual audit report. In annual programmes for which the error rate is above the materiality level of 2 % of the Community contribution, the audit authority shall analyse the significance of this error and take the necessary measures, including making appropriate recommendations, which shall be communicated at least in the annual audit report.
Article 18
Verifications by the certifying authority
1. In cases where the audit authority gives a qualified opinion or an adverse opinion on the functioning of the management and control system, the certifying authority shall verify that this information has been sent to the Commission. It shall also ensure that an adequate action plan has been implemented by the responsible authority to restore effectively functioning management and control systems and to assess the impact of the malfunctioning on the declaration of expenditure.
2. If the request for payment or statement of reimbursement is not validated by the audit authority for the final report on implementation of the annual programme, the certifying authority shall ensure that a correct request for payment or statement of reimbursement is established without delay.
CHAPTER 3
Information to be provided regarding use of the Fund
Article 19
Principle of proportionality
1. Pursuant to Article 10(2) of the basic act, the extent to which the information available to a Member State on use of the Fund is transmitted to the Commission in the documents referred to in this chapter may be proportionate to the amount of the Community contribution allocated to the Member State concerned and, where appropriate, this information may be provided in summarised form.
2. However, upon a request from the Commission, the Member State shall nevertheless provide more detailed information. The Commission may request this information if it appears necessary in order for the Commission to fulfil effectively its obligations under the basic act and the Financial Regulation.
Article 20
Description of management and control systems
1. The description of the management and control systems referred to in Articles 33(4) and 34(2) of the basic act shall be submitted in accordance with the model in Annex I.
2. The responsible authority shall validate the description of the systems implemented by any delegated authority. Each of the designated authorities shall confirm the accuracy of the description of the management and control systems which concerns it. In addition, the audit authority shall also confirm the completeness of the description.
3. When examining the description, the Commission may request clarifications and propose measures to comply with the provisions defined in the basic act. If necessary, on-site visits may be carried out by Commission officials or authorised Commission representatives.
4. If the responsible authority is the same for two or more of the four Funds or where common systems apply to two or more of the Funds, a description of the common management and control systems may be submitted highlighting, where appropriate, any specific features.
Article 21
Revision of the description of management and control systems
1. The responsible authority shall:
(a)
when submitting the draft annual programme, report whether changes have been made to the management and control systems;
(b)
notify the Commission of any substantial change at the latest once any such change has taken effect;
(c)
at the request of the Commission, provide a revised description in the event of multiple substantial changes.
2. Substantial changes are changes which are likely to have an impact on the separation of functions, on the effectiveness of selection, award, control and payment mechanisms and on communication with the Commission. They shall include, in particular, changes in one of the designated authorities, in the accounting system and in the payment and certification processes.
3. Revision of the management and control systems shall follow the same procedure as laid down in Article 20.
Article 22
Programming documents
1. Member States shall submit to the Commission a multiannual programme, as referred to in Article 21 of the basic act, in accordance with the model in Annex II.
2. Member States shall submit to the Commission the annual programmes, as referred to in Article 23 of the basic act, in accordance with the model in Annex III.
3. The financial plans linked to the multiannual programme shall present a breakdown of the budgeted amounts by priority, as defined in the strategic guidelines.
The financial plans linked to the annual programmes shall present a breakdown of the budgeted amounts by category of action, as defined in Article 3(1) of the basic act, with a reference to the priorities.
Article 23
Revision of financial breakdown in annual programmes
1. In order to revise the annual programme approved by the Commission pursuant to Article 23(4) of the basic act, the Member State concerned shall submit a revised draft annual programme to the Commission before 1 May of the year following the reference year. The Commission shall examine and, as soon as possible, approve the revised programme in accordance with the procedure laid down in Article 23(4) of the basic act.
2. Changes to the financial breakdown without revision of the annual programme pursuant to paragraph 1 shall not exceed 10 % of the total contribution from the Fund and shall be allowed only in circumstances justified by causes beyond the control of the responsible authority. An adequate explanation of any such changes shall be provided in the progress report and/or in the final report on the implementation of the annual programme.
Article 24
Progress and final reports on implementation of annual programmes
1. Member States shall submit to the Commission the progress reports on implementation of the annual programme and payment requests, as referred to in Article 41(4) of the basic act, in accordance with the model in Annex IV.
2. Member States shall submit to the Commission the final reports on implementation of the annual programme and payment requests, as referred to in Article 42(1)(b) of the basic act, in accordance with the model in Annex V.
3. The financial tables linked to the progress reports and final reports shall present a breakdown of the amounts both by priority, as defined in the strategic guidelines, and by projects for each category of action as defined in Article 3(1) of the basic act.
Article 25
Documents established by the audit authority
1. The audit strategy referred to in Article 32(1)(c) of the basic act shall be established in accordance with the model in Annex VI.
2. Except when each of the last two annual programmes adopted by the Commission corresponds to an annual Community contribution below 1 million euros, the audit authority shall submit an annual audit plan before 15 February each year, as from 2009. The audit plan shall be established as an annex to the audit strategy in accordance with the model in Annex VI. In the case of a combined audit strategy, as provided for in Article 32(2) of the basic act, a combined annual audit plan may be submitted.
3. The audit report and the opinion referred to in Articles 32(3)(a) and 32(3)(b) of the basic act shall be based on the systems audits and audits of projects carried out in accordance with the audit strategy and shall be drawn up in accordance with the models in Annexes VII.A and VII.B.
4. The validity declaration referred to in Article 32(3)(c) of the basic act shall be based on all the audit work carried out by the audit authority and on additional checks, if necessary. The validity declaration shall be drawn up in accordance with the model in Annex VII.C.
5. If there is any limitation on the scope of the examination or if the level of irregular expenditure detected does not allow provision of an unqualified opinion for the annual opinion referred to in Article 32(3)(b) of the basic act or in the declaration referred to in point (c) of the same Article, the audit authority shall give the reasons and estimate the scale of the problem and its financial impact.
Article 26
Documents established by the certifying authority
1. The certified declaration of expenditure relating to the request for a second pre-financing payment referred to in Article 41(4) of the basic act shall be drawn up and transmitted to the Commission in the format in Annex VIII.
2. The certified declaration of expenditure relating to the request for a final payment referred to in Article 42(1)(a) of the basic act shall be drawn up and transmitted to the Commission in the format in Annex IX.
CHAPTER 4
Reporting irregularities
Article 27
Initial reporting - derogations
1. In accordance with the models in Annexes IV and V, Member States shall report to the Commission any irregularity which has been the subject of a primary administrative or judicial finding in the progress or final reports on implementation of the annual programmes.
The report shall indicate:
(a)
the Fund, the annual programme and the project concerned;
(b)
the provision which has been infringed;
(c)
the date and the source of the first information leading to suspicion that an irregularity has been committed;
(d)
the practices employed in committing the irregularity;
(e)
where appropriate, whether the practice gives rise to a suspicion of fraud;
(f)
the manner in which the irregularity was discovered;
(g)
the amount of the Community contribution concerned.
However, the following cases need not be reported, except in cases of suspected fraud:
(a)
cases where the irregularities relate to amounts of less than 10 000 euros chargeable to the general budget of the European Communities;
(b)
cases where the irregularity consists solely of failure to implement, in whole or in part, a project included in the annual programme owing to the bankruptcy of the final beneficiary;
(c)
cases brought to the attention of the responsible authority by the final beneficiary voluntarily and before detection by the responsible authority, whether before or after payment of the public contribution;
(d)
cases detected and corrected by the responsible authority before any payment of the public contribution to the final beneficiary and before inclusion of the expenditure concerned in a declaration of expenditure submitted to the Commission.
2. At the request of the Commission, Member States shall in all cases give further details concerning:
(a)
where appropriate, the other Member States and third countries involved;
(b)
the period during which, or the moment at which, the irregularity was committed;
(c)
the national authorities or bodies which drew up the official report on the irregularity and the authorities responsible for the administrative or judicial follow-up;
(d)
the date on which the primary administrative or judicial finding on the irregularity was established;
(e)
the identity of the natural and legal persons involved or of any other participating entities, except where this information is irrelevant for the purposes of combating irregularities, given the nature of the irregularity concerned;
(f)
the total budget and the public contribution approved for the project and the distribution of its co-financing between the Community and national contributions;
(g)
the amount of the public contribution affected by the irregularity and the corresponding Community contribution at risk;
(h)
where no payment of the public contribution referred to under point (g) has been made to the persons or other entities identified, the amounts which would have been unduly paid had the irregularity not been identified;
(i)
the suspension of payments, where applicable, and the possibilities of recovery;
(j)
the nature of the irregular expenditure.
3. Where some of the information referred to in paragraph 2, in particular on the practices employed in committing the irregularity and on the manner in which the irregularity was discovered, is not available, Member States shall as far as possible supply the missing information when forwarding subsequent reports of irregularities to the Commission.
Article 28
Reporting of follow-up - Non-recovery
1. Member States shall inform the Commission, with reference to any previous report made under Article 27, of the procedures instituted with respect to all irregularities previously notified and of significant changes resulting from them. This information shall be given in the progress reports or final reports on implementation of the annual programmes in accordance with the models in Annexes IV and V.
The report shall indicate the amounts which have been, or are expected to be, recovered.
2. At the request of the Commission, Member States shall in all cases give further details concerning:
(a)
any interim measures taken by Member States to safeguard recovery of sums unduly paid;
(b)
any judicial and administrative procedures instituted with a view to recovering sums unduly paid and to imposing sanctions;
(c)
the reasons for any abandonment of recovery procedures;
(d)
the reasons for any abandonment of criminal prosecutions.
Member States shall report to the Commission all administrative or judicial decisions terminating such procedures, or the main points thereof, and shall state, in particular, whether or not the findings are such that fraud is suspected.
Article 29
Contacts with Member States
1. The Commission shall maintain appropriate contacts with the Member States concerned for the purpose of supplementing the information supplied on the irregularities referred to in Article 27 and on the procedures referred to in Article 28 on the possibility of recovery.
2. Independently of the contacts referred to in paragraph 1, the Commission shall inform Member States in cases where the nature of the irregularity is such as to suggest that identical or similar practices could occur in other Member States.
Article 30
Use of information
1. The Commission may use any information of a general or operational nature communicated by Member States under this Decision to perform risk analyses and may, on the basis of the information obtained, produce reports and develop early-warning systems serving to identify risks more effectively.
2. The Commission shall regularly inform the Member States concerned of the use made of information under paragraph 1.
CHAPTER 5
Information and publicity
Article 31
Information for potential final beneficiaries
1. The responsible authority shall ensure that the key indications regarding the multiannual and annual programmes are disseminated widely, with details of the financial contributions concerned, and that they are made available to all interested parties.
However, the responsible authority may decide to keep confidential the internal management arrangements laid down in the multiannual programme or in the annual programmes and any other information relating to implementation of the Fund on grounds of public security.
2. The responsible authority shall provide potential final beneficiaries with at least the following information:
(a)
the conditions of eligibility to be met in order to qualify for financing under an annual programme;
(b)
a description of the procedures for examining applications for funding and of the time periods involved;
(c)
the criteria for selecting the projects to be financed;
(d)
the contacts who can provide information on the annual programmes.
In addition, the responsible authority shall inform potential final beneficiaries of the publication provided for in Article 33(2)(b).
Article 32
Information for final beneficiaries
The responsible authority shall inform final beneficiaries that acceptance of funding also implies acceptance of their inclusion on the list of final beneficiaries published in accordance with Article 33(2)(b).
Article 33
Responsibilities of the responsible authority relating to information and publicity for the general public
1. The responsible authority shall ensure that information and publicity measures are implemented with the aim of the widest possible media coverage using various forms and methods of communication at the appropriate territorial level.
2. The responsible authority shall organise at least the following information and publicity measures:
(a)
at least one information activity a year, presenting, as of 2008, the launch of the multiannual programme or the achievements of the annual programme(s);
(b)
annual publication, at least on a website, of the list of final beneficiaries, the names of the projects and the amount of public and Community funding allocated to them. The address of the website shall be communicated to the Commission.
Article 34
Responsibilities of final beneficiaries relating to information and publicity for the general public
1. The final beneficiary shall be responsible for informing the public, by means of the measures laid down in paragraphs 2, 3 and 4, about the assistance obtained from the Fund.
2. The final beneficiary shall put up a permanent prominent plaque of significant size no later than three months after completion of any project that fulfils the following conditions:
(a)
the total Community contribution to the project exceeds EUR 100 000; and
(b)
the operation consists of purchasing a physical object or of financing infrastructure or construction projects.
The plaque shall state the type and name of the project. In addition, the information referred to in Article 35 shall take up at least 25 % of the plaque.
3. Where a project receives funding under an annual programme co-financed by the Fund, the final beneficiary shall ensure that those taking part in the project have been informed of that funding.
4. Any document, including any attendance or other certificate, concerning such projects shall include a statement indicating that the project is co-financed by the Fund.
Article 35
Technical characteristics of information and publicity for the operation
All information and publicity measures aimed at final beneficiaries, potential final beneficiaries and the general public shall include:
1.
the emblem of the European Union, in accordance with the graphic standards indicated in Annex X, and a reference to the European Union;
2.
a reference to the Fund;
3.
a statement chosen by the responsible authority, highlighting the added value of the contribution from the Community.
For small promotional items or for promotional items linked to two or more of the four Funds, points 1 and 3 shall not apply.
CHAPTER 6
Personal data
Article 36
Protection of personal data
1. Member States and the Commission shall take all necessary measures to prevent any unauthorised disclosure of, or illegitimate access to, the information referred to in Article 29(1)(h) of the basic act, information collected by the Commission in the course of its on-the-spot checks and the information referred to in Chapter 4.
2. The information referred to in Chapter 4 may not be sent to persons other than those in the Member States or within the Community institutions whose duties require that they have access to it, unless the Member State supplying such information has expressly agreed so.
CHAPTER 7
Electronic exchange of documents
Article 37
Electronic exchange of documents
In addition to the duly signed paper versions of the documents referred to in Chapter 3, the information shall also be sent, whenever possible, by electronic means.
Article 38
Computer system for the exchange of documents
1. If the Commission develops a computer system for secure data exchange between the Commission and each Member State for implementation of the Fund, the Member States shall be informed of and, at their request, involved in development of any such computer system.
2. The Commission and the designated authorities, along with the bodies to which the tasks have been delegated, shall record the documents referred to in Chapter 3 in the computer system mentioned in paragraph 1.
3. In addition, Member States may be invited voluntarily to provide information referred to in Articles 27 and 28 using the existing specific system managed by the Commission for collecting the irregularities detected under the Structural Funds.
4. Any costs of an interface between the common computer system and national, regional and local computer systems and any costs of adapting national, regional and local systems to the technical requirements of the common system shall be eligible under Article 18 of the basic act.
PART III
PROVISIONS SPECIFIC TO THE EXTERNAL BORDERS FUND
CHAPTER 1
Eligibility rules
Article 39
Eligibility rules
1. The rules set out in Annex XI shall be used to determine the eligibility of expenditure of actions financed under the annual programmes referred to in Article 37(4) of the basic act.
2. These rules are applicable to the final beneficiaries and shall apply mutatis mutandis to the project partners.
3. Member States may apply national eligibility rules that are more rigorous than those laid down in this decision.
It shall be for the Commission to evaluate whether the applicable national eligibility rules comply with this condition.
CHAPTER 2
Special Transit Scheme
Article 40
Support for the implementation of the Special Transit Scheme
1. The support for the implementation of the Special Transit Scheme referred to in Article 6 of the basic act shall be established in the framework of the multiannual programme of the Republic of Lithuania and be implemented on the basis of the annual programmes of the Republic of Lithuania.
Consequently, the rules in the basic act and this Decision regarding the implementation of annual programmes shall apply mutatis mutandis to the support for the implementation of the Special Transit Scheme. The fund shall bear any additional cost incurred in implementing the specific provision of the acquis covering such transit.
2. For each annual programme the amount to be allocated to this support shall be set in accordance with Article 6 of the basic act and within the limits of the appropriations set out in Article 14(12) of the basic act.
3. With regard to the foregone fees, the action shall run from 1 January of the year referred to in the financing decision approving the annual programme until 31 December of that year.
With regard to the additional costs, the action shall run from 1 January of the year referred to in the financing decision approving the annual programme:
(a)
for salaries of the staff specifically implementing the Special Transit Scheme until 31 December of that year;
(b)
for all other additional costs, until 31 December of the following year.
4. The amount to be allocated to this support under each annual programme shall not be used for other action.
PART IV
FINAL PROVISIONS
Article 41
Addressees
This Decision is addressed to the Kingdom of Belgium, the Republic of Bulgaria, the Czech Republic, the Federal Republic of Germany, the Republic of Estonia, the Hellenic Republic, the Kingdom of Spain, the French Republic, 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, Romania, the Republic of Slovenia, the Slovak Republic, the Republic of Finland and the Kingdom of Sweden.
Done at Brussels, 5 March 2008.