Proposal for a European Parliament and Council Decision establishing a Community action programme to promote activities in the field of the protection of the Community's financial interests
Date: 2003-05-27
Institutions: European Commission
Subjects: EU financing, action programme, financial policy, fraud against the EU

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 27.5.2003
COM (2003) 278 final

2003/0152 (COD)

Proposal for a

EUROPEAN PARLIAMENT AND COUNCIL DECISION

establishing a Community action programme to promote activities in the field
of the protection of the Community's financial interests

(presented by the Commission)

EXPLANATORY MEMORANDUM

Introduction

As the Community's responsibilities and the finances needed to implement them have grown,
so  the  need  to  protect  the  Community  budget  against  fraud  and  other  illegal  activities  has
become  an  increasingly  important  political  priority.  The  Maastricht  Treaty  added  a  specific
provision  to  the  EC  Treaty  on  protection  of  the  Community's  financial  interests  which  was
subsequently  strengthened  by  the  Amsterdam  Treaty.  The  present  Article  280  of  the
EC Treaty  requires  the  Community's  financial  interests  to  be  effective  and  equivalent
throughout the Union, for which the Community and the Member States share responsibility.

In the last fifteen years, the Community and the Member States have redoubled their efforts to
combat fraud and all other illegal activities affecting the Community's financial interests. The
Community's  contribution  has  included  setting  up  in  1998,  UCLAF,  the  Unit  for  the
Coordination  of  Fraud  Prevention  which  became  the  European  Anti-Fraud  Office  (OLAF)
in 1999,1 and adopting a whole package of instruments to protect the Community's financial
interests.  The  instruments  are  aimed  at  improving  Community  and  domestic  law  on
prevention  and  enforcement,  strengthening  the  Commission's  monitoring  powers  and
facilitating cooperation between all the authorities involved in the fight against fraud.

In parallel with these efforts, the Community is also subsidising various activities relating to
the  protection  of  the  Community's  financial  interests.  It  has  for  several  years  now  been
providing financial support for the operation of associations set up in different Member States
to  promote  the  protection  of  the  Community's  financial  interests,  and  a  number  of  studies,
conferences  and  training  courses  have  been  financed  from  the  Community  budget.  These
subsidised activities provided the bulk of the preparatory work that enabled the Commission
to present its proposal for the establishment of a European Prosecutor for the protection of the
Community's financial interests.2

Purpose of the proposal for a decision

The ongoing process of reforming the Commission, and in particular the adoption of Council
Regulation  (EC,  Euratom)  No 1605/2002  of  25 June  2002  on  the  Financial  Regulation
applicable to the general budget of the European Communities,3 requires basic instruments to
be  adopted  for  a  number  of  grants  that  were  financed  to  date  without  being  covered  by  a
specific  basic  instrument.4  Of  the  grants  that  will  in  future  need  to  be  covered  by  a  basic
instrument,  there  are  several  that  have  been  made  by  the  Commission  to  protect  the
Community's financial interests.

1

2

3

4

Commission Decision 1999/352 of 28 April 1999 establishing the European Anti-Fraud Office (OLAF),
and European Parliament and Council Regulation (EC) No 1073/99 and Council Regulation (Euratom)
No 1074/99 of 25 May 1999 concerning investigations conducted by OLAF, all published in OJ L 136,
31.5.1999.
See Commission communication of 29 September 2000 on the protection of the Community's financial
interests:  a  European  Prosecutor  (COM(2000)608  final),  and 
the  Commission  Green  Paper
of 11 December  2001  on  criminal-law  protection  of  the  financial  interests  of  the  Community  and  the
establishment of a European Prosecutor (COM(2001)715 final).
OJ L 248, 16.9.2002, p. 1.
See Commission communication to the Council and the European Parliament of [...] for further details.

2

                                                
The purpose of this proposal is to establish that basic instrument by setting up a Community
action programme for Commission grants in this field. Such grants will obviously still have to
respect the primary responsibility of the Member States in this area, as in the past. Community
grants  are  not  intended  to  replace  those  of  Member  States  but  to  provide  the  added  value
needed  to  take  account  of  the  European  dimension  to  protect  the  Community's  financial
interests.  Large-scale  economic  and  financial  crime  calls  for  a  Community  approach  which
takes account of the transnational and multidisciplinary aspects. Such an approach must first
ensure  the  convergence  of  the  aided  activities  in  order  to  afford  an  equivalent  degree  of
protection whilst respecting the individual traditions of each Member State.

Legal basis for the proposed decision

The  Commission  is  proposing  a  decision  based  on  Article  280(4)  of  the  EC Treaty,  which
authorises  the  Community  legislature  to  adopt  "the  necessary  measures  in  the  fields  of  the
prevention of and fight against fraud affecting the financial interests of the Community with a
view  to  affording  effective  and  equivalent  protection  in  the  Member  States".  Given  its
objective and the need to avoid interrupting existing grants, the proposed decision constitutes
a  necessary  measure  under  Article 280(4)  of  the  EC  Treaty  and  respects  the  principles  of
subsidiarity and proportionality.

Main features of the proposed decision

The  purpose  of  the  proposed  decision  is  to  establish  a  Community  action  programme  to
promote  activities  in  the  field  of  the  protection  of  the  Community's  financial  interests  (the
programme  ‘HERCULE’5).  It  covers  both  grants  for  specific  measures,  e.g.  studies,
conferences  or  training,  and  operating  grants  to  bodies  operating  in  this  field,  such  as
associations set up to promote the protection of the Community's financial interests.

The recipients of such grants will have to satisfy certain conditions specified in the proposed
decision and the annex to it. In particular, they must be located in one of the Member States of
the  Union  or  in  another  European  or  neighbouring  country  with  which  the  Community  has
concluded  agreements  regarding  the  Communities’  financial  interests.  This  coverage  is
justified  by  the  need  to  protect  the  Community's  financial  interests  beyond  the  existing
Member States where the Union has a close involvement with these other countries, especially
in connection with enlargement. Recipients will be selected by means of a call for proposals,
subject  to  the  priorities  contained  in  each  annual  grants  programme  detailing  the  general
criteria of the Community action programme set up by this proposal for a decision.

It is proposed that the Community action programme cover the period from the beginning of
January 2004 to the end of December 2008. The amounts earmarked for the  programme  are
based  on  the  grants  made  under  the  European  Communities'  budget  for  2003,  which
total €3 375 000.  To  take  account  of  enlargement,  which  is  likely  to  have  the  effect  of
increasing  the  number  of  activities  and  bodies  eligible  for  grants,  it  is  proposed  that  the
average annual amount be set at €4 297 000 a year, which gives total funding of €21 485 000
over five years.

5

‘HERCULE’  refers  notably  to  the  Greek  hero  known  for  his  extraordinary  feats.  In  performing  his
twelve labours, he triumphed against enemies that all had thought to be invincible.

3

                                                
2003/0152 (COD)

Proposal for a

EUROPEAN PARLIAMENT AND COUNCIL DECISION

establishing a Community action programme to promote activities in the field of the
protection of the Community's financial interests

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular
Article 280 (4) thereof,

Having regard to the proposal from the Commission,6

Having regard to the Opinion of the Court of Auditors,7

Acting in accordance with the procedure laid down in Article 251 of the Treaty,8

Whereas:

(1) 

(2) 

(3) 

(4) 

The  Community  and  the  Member  States  have  set  themselves  the  objective  of
countering  fraud  and  any  other  illegal  activities  affecting  the  Community's  financial
interests.  All  available  means  must  be  deployed  to  attain  that  objective,  whilst
maintaining  the  current  distribution  and  balance  of  responsibilities  between  the
national and Community levels.

Activities  and  bodies  with  the  purpose  of  providing  better  information,  carrying  out
studies and providing training or technical and scientific assistance in the fight against
fraud help significantly to protect the Community's financial interests.

Specific activities in this field should therefore be promoted and bodies engaged in this
field  should  be  supported  by  means  of  operating  grants.  Experience  has  shown  the
value of providing support at Community level as compared with national promotional
activities.

Support  for  bodies  and  activities  was  provided  until  2003  by  lines  A03600  A03010
(Conferences,  congresses  and  meetings  in  connection  with  the  activities  of  the
associations  of  European  lawyers  for  the  protection  of  the  financial  interests  of  the
Community) and B5-910 (General measures to combat fraud) of the general budget of
the European Union.

6

7

8

OJ C […], […], p. […].
OJ C […], […], p. […].
OJ C […], […], p. […].

4

                                                
(5) 

(6) 

(7) 

(8) 

(9) 

Council  Regulation  (EC,  Euratom)  No  1605/2002  of  25  June  2002  on  the  Financial
Regulation applicable to the general budget of the European Communities9 requires a
basic instrument to be provided for existing support measures.

It  is  therefore  necessary  to  establish  that  basic  instrument  and  to  rationalise  and
supplement  all  existing  support  measures  by  adopting  this  Decision  establishing  a
structured,  specific  and  multidisciplinary  Community  action  programme  for  a
substantial period.

The programme should cover all Member States and neighbouring countries in view of
the importance  of  providing  effective  and  equivalent  protection  for  the  Community's
financial interests beyond the Member States alone.

The  support  measures  should  also  take  account  of  the  particular  characteristics  of
bodies involved in protecting the Community's financial interests.

This  Decision  establishes  a  financial  framework  for  the  entire  duration  of  the
programme which is to be the principal point of reference for the budgetary authority,
within  the  meaning  of  point 33  of  the  Interinstitutional  Agreement  of  6  May  1999
between  the  European  Parliament,  the  Council  and  the  Commission  on  budgetary
discipline and improvement of the budgetary procedure10.

(10)  The  Commission  should  report  to  the  European  Parliament  and  the  Council  on  the

attainment of the programme's objectives.

(11)  This Decision complies with the principles of subsidiarity and proportionality.

(12)  This Decision is without prejudice to grants awarded in the field of protection of the
Community's  financial  interests  on  the  basis  of  programmes  concerning  the
law-enforcement aspect.

HAVE DECIDED AS FOLLOWS:

Article 1 - (cid:1)Objective of the programme(cid:2)

1.

2.

This  Decision  establishes  a  Community  action  programme  to  promote  activities  in
the  field  of  the  protection  of  the  financial  interests  of  the  Community.  The
programme shall be known as the “HERCULE” programme.

The  purpose  of  the  programme  shall  be  to  help  protect  the  Community's  financial
interests  by  promoting  activities  and  supporting  bodies  in  accordance  with  the
general  criteria  set  out  in  the  Annex  and  specified  in  detail  in  each  annual  grants
programme. It shall take transnational and multidisciplinary aspects  into account. It
shall  focus  on  aligning  the  substance  of  activities  so  as  to  ensure  effective  and
equivalent  levels  of  protection  on  the  basis  of  mutually  agreed  best  practice  while
also respecting the distinct traditions of each Member State.

9

10

OJ L 248, 16.9.2002, p. 1.
OJ C 172, 18.6.1999, p. 1.

5

                                                
Article 2 - (cid:1)Access to the programme(cid:2)

1.

2.

To  qualify  for  a  Community  grant  for  an  activity  aimed  at  protecting  the
Community's financial interests, applicants must comply with the provisions set out
in  the  Annex.  The  activity  must  conform  to  the  principles  underlying  Community
activity in the field of the protection of the Community's financial interests and take
account  of  the  specific  criteria  laid  down  in  the  related  calls  for  proposals,  in
accordance  with  the  priorities  set  out  in  the  annual  grants  programme  detailing  the
general criteria set out in the Annex.

To qualify for a Community operating grant under the ongoing work programme of a
body  which  pursues  an  objective  of  general  European  interest  in  the  field  of  the
protection  of  the  Community's  financial  interests,  a  body  must  satisfy  the  general
criteria set out in the Annex.

Article 3 - (cid:1)Participation by countries outside the Community(cid:2)

In  addition  to  recipients  and  bodies  located  in  the  Member  States,  participation  in  the
Community action programme shall be open to those located in:

a)

b)

c)

d)

e)

f)

countries which agreed at the Copenhagen summit in 2002 to join the European
Union in 2004;

the  EFTA/EEA countries,  in accordance  with the  conditions  laid  down  in  the
EEA Agreement;

Romania  and  Bulgaria,  in  accordance  with  the  conditions  laid  down  in  the
Europe  Agreements,  in  their  additional  protocols  and  in  the  decisions  of  the
respective Association Councils;

Turkey;

the  Balkan  countries  forming  part  of  the  stabilisation  and  association  process
for countries of south eastern Europe;11

certain countries of the Commonwealth of Independent States.12

Article 4 - (cid:1)Selection of beneficiaries(cid:2)

The  bodies  to  receive  grants  for  activities  shall  be  selected  following  a  call  for
proposals, in accordance with the priorities set out in the annual grants programme,
which  details  the  general  criteria  referred  to  in  the  Annex.  Grants  awarded  for  an
activity  covered  by  the  programme  shall  meet  the  general  criteria  set  out  in  the
Annex.

Former  Yugoslav  Republic  of  Macedonia,  Albania,  Serbia  and  Montenegro,  Bosnia-Herzegovina  and
Croatia.
Belarus, Moldavia, Russian Federation and Ukraine.

6

1.

11

12

                                                
2.

1.

2.

1.

2.

3.

The  bodies  to  receive  operating  grants  shall  be  selected  following  a  call  for
proposals.  The  award  of  an  operating  grant  on  the  basis  of  a  beneficiary's  ongoing
work programme shall meet the general criteria set out in the Annex. On the basis of
the  call 
the
beneficiaries and the  amounts  approved, 
in  accordance  with  Article  116  of
Regulation (EC, Euratom) No 1605/2002.

the  Commission  shall  draw  up  a 

for  proposals, 

list  of 

Article 5 - (cid:1)Awarding of the grant(cid:2)

Financial assistance granted for activities may not cover all eligible expenditure. The
amount of a grant for an activity awarded under the programme may not exceed 90%
of  the  eligible  expenditure  of  the  body  for  the  calendar  year  for  which  the  grant  is
intended.

The  amount  of  an  operating  grant  awarded  under  the  programme  may  not
exceed 70% of the eligible  expenditure of the body  for  the  calendar  year  for  which
the grant is awarded.

Pursuant to Article 113(2) of Regulation (EC, Euratom) No 1605/2002,  where  such
operating grants are renewed, they shall be gradually decreased. If a grant is awarded
to  a  body  which  received  an  operating  grant  the  preceding  year,  the  percentage  of
Community co-financing represented by the new grant shall be at least 10 percentage
points lower than the Community co-financing percentage represented by the grant in
the preceding year.

Article 6 - (cid:1)Financial provisions(cid:2)

The programme shall start on 1 January 2004 and end on 31 December 2008.

The  financial  framework  for  the  implementation  of  the  programme  for  the
period 2004 to 2008 shall be EUR 21.485 million.

The annual appropriations shall be authorised by the budgetary authority within  the
limits of the financial perspective.

Article 7 - (cid:1)Monitoring and evaluation(cid:2)

By 31 December 2009 at the latest, the Commission shall report to the European Parliament
and the Council on the achievement of the objectives of this programme. The report shall be
based on the results obtained by the beneficiaries and assess, in particular, their effectiveness
in achieving the objectives defined in Article 1 and the Annex.

7

Article 8 - (cid:1)Entry into force(cid:2)

This Decision shall enter into force on the day following its publication in the Official Journal
of the European Union.

Done at Brussels, […]

For the European Parliament
The President
[…]

For the Council
The President
[…]

8

ANNEX

1.

ACTIVITIES SUPPORTED

The general objective laid down in Article 1 is to reinforce Community action to prevent fraud
affecting the Community's financial interests and to combat such fraud by promoting actions
and the operation of bodies engaged in this field.

Activities of bodies which may help to reinforce and increase the effectiveness of Community
action, in accordance with Article 2 of the Decision, include the following:

– 

– 

– 

– 

– 

– 

– 

– 

2.

organisation of seminars and conferences;

promotion of scientific studies and discussions on Community policies in this field;

coordination  of  activities  relating  to  the  protection  of  the  Community's  financial
interests;

training and awareness;

dissemination of scientific information on Community action;

development and supply of specific IT tools;

technical assistance;

promoting and expanding the exchange of data.

CARRYING OUT THE ACTIVITIES SUPPORTED

The  activities  carried  out  by  bodies  which  may  receive  a  Community  grant  under  the
programme  come  under  the  heading  of  specific  actions  aimed  at  strengthening  Community
measures to protect financial interests and pursue an objective of general European interest in
this field or an objective which is part of the European Union's policy in this area.

In accordance with Article 2 of the Decision, this applies to:

– 

– 

– 

all  national  or  regional  administrations  of  Member  States  or  countries  outside  the
Union,  as  defined  in  Article  3  of  this  Decision,  which  promote  the  action  of  the
Community in the field of the protection of the Community's financial interests;

all  research  and  education  institutes  that  have  had  legal  personality  for  at  least  one
year and are established and operating in the Member States or in countries outside
the  Union,  as  defined  in  Article  3  of  this  Decision,  and  that  promote  the
strengthening of the Community's action in protecting its financial interests;

all non-profit-making bodies that have had legal personality for at least one year and
are legally established in a Member State or country outside the Union, as defined in
Article 3 of this Decision, and that promote the strengthening of Community action
to protect the Community's financial interests.

9

An  annual  operating  grant  may  be  awarded  to  support  implementation  of  such  a  body's
ongoing programme of work.

3.

SELECTION OF BENEFICIARIES

Bodies entitled to receive a grant for the activity or an operating grant under Section 2 of the
Annex to this programme will be selected on the basis of calls for proposals.

4.

CHARACTERISTICS OF GRANT APPLICATIONS ON WHICH ASSESSMENT IS BASED

Applications  for  grants  for  specific  activities  or,  where  appropriate,  operating  grants  are
assessed in the light of:

– 

– 

– 

– 

– 

– 

– 

– 

5.

consistency of the proposed activity in relation to the objectives of the programme;

complementarity of the proposed activity with other assisted activities;

feasibility of the proposed activity, i.e. the real  possibility  that  it  can  be  carried  out
using the proposed means;

the cost-benefit ratio;

the added value of the proposed activity;

size of public targeted by the proposed activity;

transnational and multidisciplinary aspects of the activity;

geographic scope of the proposed measure.

ELIGIBLE EXPENDITURE

Pursuant  to  Section  2  of  this  programme,  only  the  expenditure  required  for  the  successful
implementation of the activity is taken into account when calculating the grant.

6.

6.1

6.2

CHECKS AND AUDITS

including 

The beneficiary of an operating grant must keep available for the Commission all the
supporting  documents, 
the  audited  financial  statement,  regarding
expenditure incurred during the grant year for a period of five years following the last
payment. The beneficiary of a  grant  must  ensure  that,  where  applicable,  supporting
documents  in  the  possession  of  partners  or  members  are  made  available  to  the
Commission.

The Commission may have an audit of the use made of the grant carried  out  either
directly  by  its  own  staff  or  by  any  other  qualified  outside  body  of  its  choice.  Such
audits may be carried out throughout the lifetime of the agreement and for a period of
five  years  from  the  date  of  payment  of  the  balance.  Where  appropriate,  the  audit
findings may lead to recovery decisions by the Commission.

10

6.3

6.4

6.5

Commission  staff  and  outside  personnel  authorised  by  the  Commission  have
appropriate right of access to sites and premises where the action is carried out and to
all  the  information,  including  information  in  electronic  format,  needed  in  order  to
conduct such audits.

The Court of Auditors and the European Anti-Fraud Office (OLAF) must enjoy the
same rights, especially of access, as the Commission.

Furthermore, in order to protect the European Community's financial interests against
fraud  and  other  irregularities,  the  Commission  may  carry  out  on-the-spot  checks
and inspections 
accordance  with  Council
Regulation (Euratom, EC)  No  2185/96.13  Where  necessary,  investigations  must  be
conducted  by  the  European  Anti-Fraud  Office  (OLAF)  and  governed  by  European
Parliament and Council Regulation (EC) No 1073/1999.14

programme 

under 

this 

in 

7.

MANAGEMENT OF THE PROGRAMME

On  the  basis  of  a  cost-effectiveness  analysis,  the  Commission  may  decide  to  entrust  all  or
some  of  the  tasks  of  managing  the  programme  to  an  executive  agency,  in  accordance  with
Article 55  of  the  Financial  Regulation  applicable  to  the  general  budget  of  the  European
Communities;  it  may  also  employ  experts  and  incur  any  other  expenditure  on  technical  and
administrative assistance not involving public authority tasks outsourced under ad hoc service
contracts.  It  may  also  finance  studies  and  organise  meetings  of  experts  to  facilitate  the
implementation  of  the  programme,  and  take  information,  publication  and  dissemination
measures directly linked to fulfilling the objectives of the programme.

13

14

OJ L 292, 15.11.1996, p. 2.
OJ L 136, 31.5.1999, p. 1.

11

                                                
LEGISLATIVE FINANCIAL STATEMENT

Policy area(s): FIGHT AGAINST FRAUD

Activit(y/ies):  PROMOTING  THE  PROTECTION  OF  THE  COMMUNITIES’
FINANCIAL INTERESTS

TITLE OF ACTION:

PROMOTION OF ACTIVITIES IN THE FIELD OF THE PROTECTION OF THE COMMUNITY'S FINANCIAL
INTERESTS

1.

BUDGET LINE(S) + HEADING(S)

Nomenclature:

24.02.04  (ex  COM  A03600 A03010  in  2003)  Support  for  the  activities  of  the
associations  of  European  lawyers  for  the  protection  of  the  financial  interests  of  the
Community.

24.02.05 (ex B5-910 in part in 2003) Co-financed general measures to combat fraud.

2.

2.1.

2.2.

OVERALL FIGURES

Total allocation for action (Part B): €21.485 million for commitment

Period of application:

2004-08

2.3.

Overall multiannual estimate of expenditure:

As regards heading 3:

(a)

Schedule of commitment appropriations/payment appropriations (financial intervention)
(see point 6.1.1)

€ million (to three decimal places)

2004

2005

2006

2007

2008

Total

2009
and
subs.
years

Commitments

Payments

3.660

3

3.8

3.5

3.9

4

4.0

4

4.150

19.51

4.5

0.51

19.51

12

(b)

Technical and administrative assistance and support expenditure (see point 6.1.2)

Commitments

Payments

Subtotal a+b

Commitments

Payments

As regards heading 5:

3.660

3

3.8

3.5

3.9

4

4.0

4

4.150

19.51

4.5

0.51

19.51

€ million (to three decimal places)

2004

2005

2006

2007

2008

Total

2009
and
subs.
years

Commitments

0.375

0.385

0.395

0.405

0.415

1.975

Payments

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

(c)

Overall  financial  impact  of  human  resources  and  other  administrative  expenditure
(see points 7.2 and 7.3)

Commitments/
payments

Human resources deployed are existing resources (2 A, 4 B, 3 C)

TOTAL a+b+c

Commitments

Payments

3.660

3

3.8

3.5

3.9

4

4.0

4

4.150

19.51

4.5

0.51

19.51

Non-diff. (heading 5)

0.375

0.385

0.395

0.405

0.415

1.975

2.4.

Compatibility with financial programming and financial perspective

(cid:1) Proposal is compatible with existing financial programming.

(cid:2) Proposal  will  entail  reprogramming  of  the  relevant  heading  in  the  financial

perspective.

(cid:2) Proposal  may  require  application  of  the  provisions  of  the  Interinstitutional

Agreement.

2.5.

Financial impact on revenue

(cid:1) Proposal  has  no  financial  implications  (involves  technical  aspects  regarding

implementation of a measure).

13

3.

BUDGET CHARACTERISTICS

Type of expenditure

New

EFTA
contribution

Contributions
form applicant
countries

Heading in
financial
perspective

Non-comp

Diff

Non-comp

Non-diff

YES

YES

NO

NO

NO

NO

3

5

Note: The action is new in this form. However, it follows on from Community measures that
have existed in a different form for several years and is intended to provide a legal basis for
these measures. It relates to the old budget lines COM-A03600  A03010 (heading  PF 5) and
B5-910 (heading PF 3).

4.

LEGAL BASIS

Proposal for a Decision of the European Parliament and of the Council adopted by the
Commission on ....

5.

5.1.

DESCRIPTION AND GROUNDS

Need for Community intervention 15

5.1.1. Objectives pursued

As  the  Community's  responsibilities  and  the  finances  needed  to  implement  them  have
grown,  the  need  to  protect  the  Community  budget  against  fraud  and  other  illegal
activities has become a priority. The Maastricht Treaty added a specific provision to the
EC Treaty on protection of the Community's financial interests which was subsequently
strengthened  by  the  Amsterdam  Treaty.  The  present  Article  280  of  the  EC  Treaty
requires  the  Community's  financial  interests  to  be  effective  and  equivalent  throughout
the Union, for which the Community and the Member States share responsibility.

This  led  to  the  creation  of  budget  lines  COM-  A03600  A03010  and  B5-910  of  the
general  budget  of  the  European  Communities  for  2003  and  previous  years.  Council
Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation
applicable to the general budget of the European Communities requires the adoption of
a Community action programme for the awarding of grants by the Commission in this
field.

The grants will obviously still have to respect the primary responsibility of the Member
States in this area, as in the past. Community grants are not intended to replace those of
Member States but to provide the added value needed to take account of the European
dimension  to  protect  the  Community's  financial  interests.  Large-scale  economic  and
financial crime calls for a Community approach which takes account of the transnational
and multidisciplinary aspects. Such an approach must first ensure the convergence of the
aided  activities  in  order  to  afford  an  equivalent  degree  of  protection  whilst  respecting
the individual traditions of each Member State concerned by this Community action.

15

For further information, see separate explanatory note.

14

                                                
5.1.2. Measures taken in connection with ex ante evaluation

This proposal is primarily intended to satisfy the technical need to provide a legal basis
for grants traditionally awarded in this field in part A of the budget.

5.2.

Action envisaged and budget intervention arrangements

The general objective  of  the  proposal  is  to  increase  and  improve  the  protection  of  the
Community’s financial interests.

This objective is to be achieved by means of action taken by administrations or bodies
which  can  help  to  reinforce  and  increase  the  effectiveness  of  Community  action  to
protect  the  Community’s  financial  interests  by  improving  and  ensuring  an  equivalent
degree  of  protection  whilst  respecting  the  individual  traditions  of  each  Member  State
concerned by this Community action.

The target population(s) (specify number of beneficiaries if possible):

– 

– 

– 

All national or regional administrations of Member States or countries outside the
Union, as defined in Article 3 of this Decision,  which promote the action  of the
Community in the field of the protection of the Community's financial interests;

All  research  and  education  institutes  established  and  operating  in  the  Member
States or in countries outside the Union, as defined in Article 3 of this Decision,
that promote the Community's action to protect its financial interests.

All  non-profit  making  bodies  that  have  a  legal  personality  and  are  legally
established in a Member State or country outside the Union, as defined in Article
3  of  this  Decision,  and  that  promote  the  strengthening  of  Community  action  to
protect the Community's financial interests;

The specific objectives set for the programming period are as follows:

– 

– 

– 

– 

– 

– 

to  encourage  the  dissemination  of  knowledge  about  the  protection  of  the
Community’s financial interests;

to encourage research;

to improve training and awareness-raising;

to encourage the coordination of activities;

to expand the exchange of data;

to support technical assistance.

Practical measures to be taken to implement the action.

The  objectives  of  the  Community  action  will  be  achieved  by  supporting  bodies  that
promote the protection of the Community’s financial interests.

15

Immediate outputs of each action.

The  immediate  outputs  will  be  the  measures  taken  by  the  beneficiaries  within  the
framework  of  the  annual  work  programme,  including  the  organisation  of  conferences,
studies, etc.

Contribution of these outputs to the expected outcomes in terms of satisfying needs or
solving problems.

The main outcome will be the strengthening of protection of the Community’s financial
interests in the Member States and the countries covered by the proposal.

5.3.

Methods of implementation

Direct management by the Commission (OLAF).

6.

FINANCIAL IMPACT

6.1.

Total financial impact on Part B - (over the entire programming period)

6.1.1.

Financial intervention

Commitments (in € million to three decimal places)

Breakdown

Action 1 (heading PF 5)

Action 2 (heading PF 3)

etc.

2004

0.375

3.66016

2005

0.385

3.800

2006

0.395

3.900

2007

0.405

4.000

2008

0.415

4.150

TOTAL

4.035

4.185

4.295

4.405

4.565

Total

1.975

19.510

21.485

6.1.2

Technical  and  administrative  assistance,  support  expenditure  and  IT  expenditure
(commitment appropriations)

2004

2005

2006

Total

1)Technical and
administrative assistance:
a)Technical assistance
offices:

b) Other technical and
administrative assistance:
- intra-muros:
- extra-muros:
of  which  for  construction
and 
of
maintenance 
computerised  management
systems:

Subtotal 1

16

Amount for EUR15 = €3.210 million; amount for EUR10 = €0.450 million.

16

                                                
2) Support expenditure:

a) Studies

b) Meetings of experts

c) Information and
publications

Subtotal 2

TOTAL

6.2.

Calculation  of  costs  by  measure  envisaged  in  Part  B  (over  the  entire
programming period)17

Commitments (in € million to three decimal places)

Number of
outputs

Average unit
cost

Total cost

(total for years
1…n)

(total for years
1…n)
2

3

4=(2X3)

Breakdown

Type
of outputs
(projects, files )

1

Action 1
- Mesure 1
- Mesure 2
Action 2
- Mesure 1
- Mesure 2
- Mesure 3
etc.

COÛT TOTAL

7.

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE

7.1.

Impact on human resources

Types of post

Staff to be assigned to management of the
action using existing and/or additional
resources

Number of
permanent posts

Number of
temporary posts

Total

Description of tasks deriving from
the action

Officials or
temporary staff

A
B
C

2 A
4 B
3 C

Other human resources

Total

9 people

17 

For further information, see separate explanatory note.

17

                                                
7.2.

Overall financial impact of human resources

Type of human resources

Amount (€)

Method of calculation *

Officials

Temporary staff

Other human resources

(specify budget line)

Total

The amounts are total expenditure for twelve months.

7.3.

Other administrative expenditure deriving from the action

Amount €

Method of calculation

Budget line

(number and heading)

Overall allocation (Title A7)

A0701 – Missions

A07030 – Meetings

A07031 – Compulsory committees (1)

A07032 – Non-compulsory committees (1)

A07040 – Conferences

A0705 – Studies and consultations

Other expenditure (specify)

Information systems (A-5001/A-4300)

Other expenditure - Part A (specify)

Total

The amounts are total expenditure for twelve months.

(1) Specify the type of committee and the group to which it belongs.

I.

II.

III.

Annual total (7.2 + 7.3)

Duration of action

Total cost of action (I x II)

5 years

€21.485 million

8.

FOLLOW-UP AND EVALUATION

8.1.

Follow-up arrangements

By  31  December  2009  at  the  latest,  the  Commission  will  report  to  the  European
Parliament and the Council on the achievement of the objectives of this programme.
The  report  will  be  based  on  the  results  obtained  by  the  beneficiaries  and  assess,  in
particular, their effectiveness in achieving the objectives defined in Article 1 and the
Annex.

18

8.2.

Arrangements and schedule for the planned evaluation

Evaluation will be conducted on an annual basis. The final payment will be subject to
approval of the financial report and the activity report presented by the organisations
entitled to the grant.

The evaluation will examine the relevance, effectiveness and cost effectiveness of the
actions carried out in relation to the objectives set out in Article 1 of this Decision. It
will also examine the impact of the programme as a whole.

The  evaluation  will  also  examine  the  complementarity  between  action  under  the
programme and  that  pursued  under  other  relevant  Community  policies,  instruments
and actions.

9.

ANTI-FRAUD MEASURES

In  order  to  protect  the  European  Community's  financial  interests  against  fraud  and
other  irregularities,  the  Commission  may  carry  out  on-the-spot  checks  and
inspections under this programme in accordance with Council Regulation (Euratom,
EC) No 2185/96.18  Where  necessary,  investigations  are  conducted  by  the  European
Anti-Fraud  Office  (OLAF)  and  governed  by  European  Parliament  and  Council
Regulation (EC) No 1073/1999.19

including 

The beneficiary of an operating grant must keep available for the Commission all the
supporting  documents, 
the  audited  financial  statement,  regarding
expenditure incurred during the grant year for a period of five years following the last
payment. The beneficiary of a  grant  must  ensure  that,  where  applicable,  supporting
documents  in  the  possession  of  partners  or  members  are  made  available  to  the
Commission.

The Commission will carry out regular documentary and on-the-spot checks.

18

19

OJ L 292, 15.11.1996, p. 2.
OJ L 136 du 31.5.1999, p. 1.

19