WRITTEN QUESTION E-1594/99

by Bart Staes (Verts/ALE) to the Commission

(1 September 1999)

Subject: Operation of the ECIP programme

The European Community Investment Partners programme (ECIP) is the financial instrument which since September 1988 has provided financial assistance to 60 developing countries in Asia, Latin America, the Mediterranean region and South Africa (the Alamedsa group). ECIP is very generously funded, and it is therefore unquestionably desirable to be vigilant about its management. In its annual report for 1993, the Court of Auditors of the EC already drew attention to a number of irregularities.

The Commission recently admitted that a number of shortcomings in ECIP were being investigated. The German magazine STERN revealed in early August 1999 that 42 million had disappeared. The magazine questioned the role of Commissioner Marín and the involvement of a senior European official in this connection.

1. Can the Commission provide a complete list of all projects which have received ECIP funding, stating the partners involved on the part both of the EU and of the recipient country? What progress has been made in the inquiry into the management of ECIP? Why was this inquiry only started recently?

2. What measures has the Commission taken in response to the observations made by the Court of Auditors in its 1993 report concerning ECIP? If it has not taken any, who was responsible for this? If it has taken measures, what action resulted?

3. Is the involvement of officials that is, the official named by STERN being investigated? If so, what is the current situation in this inquiry? If not, does the Commission intend to start an inquiry?

4. Since when has the Commissioner concerned been aware of possible misappropriations?

Joint answer to Written Questions E-1590/99 and E-1594/99 given by Mr Patten on behalf of the Commission

(26 October 1999)

Reports in the press that 42 million of European Communities investment partners (ECIP) funds have disappeared are incorrect. These reports were based on press mis-interpretation of a public Commission note distributed to the Parliament's budgetary commission which stated that 42 million relating to 1 348 completed ECIP actions is in the process of reimbursement by the financial institutions members of the ECIP network. Such reimbursement is a routine aspect of the operations of the ECIP instrument. The funds are held in financial institutions accredited to the ECIP network, each governed by a specific framework contract with the Commission. In conformity with the provisions of Council Regulation (EC) 0213/96 of 29 January 1996 on the implementation of the European Communities investment partners financial instrument for the countries of Latin America, Asia, Mediterranean region and South Africa(1) these funds have been audited. Should analysis of these audits reveal any suspicion of irregularities or possible fraud, OLAF will be informed immediately. The Commission increased its efforts in 1999 to close out those files and to recover the 42 million funds identified by the independent audit.

The Directorate general for external relations is responsible for the ECIP programme. The financial execution is ensured by the Common service for external relations.

The Commission provides to the Council and the Parliament each year a detailed progress report including statistical tables on the implementation of the ECIP programme. The Commission is sending direct to the Honourable Member and the Parliament's Secretariat a copy of the 1997 report and the 1998 overview.

In addition, in accordance with the ECIP Regulation, the Commission has placed, after open public international tender, a contract with Deloitte S.A. to execute an independent appraisal which is due for completion before the end of 1999 and will be communicated to the Council and Parliament as soon as available.

The measures introduced to further reinforce the management after 1995 of the ECIP programme were discussed and agreed with the Council and Parliament during 1994-1995 and are included in the present ECIP Regulation. These have been implemented fully by the Commission. They are independent evaluation appraisal studies (1990 Touche Ross, 1994 SEMA Group, 1999 Deloitte (in progress)), independent financial audits (1996 Coopers & Lybrand, 1997 Price Waterhouse Coopers), technical assistance units (1997 onwards), and specific anti-fraud provisions and penalty clauses in all contracts.

(1) OJ L 28, 6.2.1999.