Proposal for a Council Decision on the position to be adopted by the Community within the ACP-EC Committee of Ambassadors concerning the financial regulation and the statutes and rules of procedure of the Centre for the Development of Enterprise
Date: 2003-09-10
Institutions: European Commission
Subjects: ACP countries, Centre for the Development of Enterprise, agreement (EU), aid to undertakings, financial regulation, legal status, rules of procedure

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 10.9.2003
COM(2003) 538 final

Proposal for a

COUNCIL DECISION

On the position to be adopted by the Community within the ACP-EC Committee of
Ambassadors concerning the financial regulation and the statutes and rules of
procedure of the Centre for the Development of Enterprise

(presented by the Commission)

EXPLANATORY MEMORANDUM

The  Cotonou  Agreement  of  June  2000  gives  a  central  role  to  the  private  sector  in  the
fulfilment of the main objectives of the EU-ACP partnership, i.e. the reduction and ultimately
the  eradication  of  poverty,  the  promotion  of  sustainable  development  and  the  progressive
integration of the ACP countries into the world economy.

It has set up the Centre for the Development of Enterprise, CDE, as the main provider of non-
financial services to ACP firms and businesses and as a supporter of joint initiatives launched
by ACP and  EU  entrepreneurs. Created  in 1977,  the  Centre,  which  at  the  beginning  mainly
concentrated  on  industrialisation,  has  seen  its  remit  extended  to  cover  the  service  sector.
Hence its change of name from CDI (Centre for the Development of Industry) to CDE.

The role of the CDE is to assist ACP enterprises to become more competitive, to facilitate and
to  promote  business  co-operation  and  partnership  between  ACP  and  EU  enterprises.  It  also
helps with the development  of business support services,  provides  assistance  for  investment
promotion activities and contributes to the development and transfer  of  technologies,  know-
how  and  best  practices  in  business  management.  To  carry  out  these  tasks,  90  million  Euro
have  been  earmarked  for  the  CDE  in  the  9th  EDF,  an  increase  from  the  73  million  Euro  it
received under the 8th EDF.

In its Annex III, the Cotonou Agreement provides that after the signing of the Agreement, the
statutes and rules of procedure of the Centre as well as the financial and staff regulations will
be  laid  down.  This  process  has  taken  longer  than  expected  due  to  the  Centre’s  internal
difficulties resulting from the absence of a board for more than two years. These difficulties
have now been resolved. A new board was finally appointed last year and has recently held its
first meeting.

The  financial  regulation  of  the  9th  EDF,  which  has  a  bearing  on  the  Centre  financial
regulation,  has  recently  been  adopted.  The  time  is  now  right  for  this  Council  decision,  the
legal basis of which is the Cotonou Agreement that entered into force on 1 April 2003.

Member states are requested to examine the following proposal. Member states are requested
to  adopt  the  following  decision  on  the  Community  position  to  be  adopted  by  the  ACP-EC
Committee of Ambassadors on the financial regulation and the statutes and rules of procedure
of the Centre of the Development of Enterprise.

2

Proposal for a

COUNCIL DECISION

On the position to be adopted by the Community within the ACP-EC Committee of
Ambassadors concerning the financial regulation and the statutes and rules of
procedure of the Centre for the Development of Enterprise

THE COUNCIL OF THE EUROPEAN UNION,

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular
Article 310 in conjunction with the second subparagraph of Article 300(2) thereof,

Having regard to the proposal from the Commission,

Whereas:

(1)

According  to  the  Partnership  Agreement  between  the  members  of  the  African,
Caribbean and Pacific Group of States of the one part, and the European Community
and its Member States, of the other part, signed in Cotonou on 23 June 20001 and in
particular  its  Annex  III,  the  statutes  and  rules  of  procedures  and  the  financial
regulation of the Centre for the Development of Enterprise, hereinafter referred to as
the Centre, should be adopted,

HAS DECIDED AS FOLLOWS :

Article 1

The  Community  shall  take  the  following  position  within  the  ACP-EC  Committee  of
Ambassadors on the statutes and rules of procedures of the Centre, based on the draft decision
of the ACP-EC Committee of Ambassadors attached in Annex 1.

1 OJ L 317, 15.12.2000, p. 3.

3

                                                
Article 2

The  Community  shall  take  the  following  position  within  the  ACP-EC  Committee  of
Ambassadors on the financial regulation of the Centre based on the draft decision of the ACP-
EC Committee of Ambassadors attached in Annex 2.

Done at Brussels,

For the Council
The President

4

Annex I

Draft

DECISION No OF THE ACP-EC COMMITTEE OF AMBASSADORS

of

on the statutes and rules of procedure of the Centre for the Development of Entreprise

THE ACP-EC COMMITTEE OF AMBASSADORS,

Having regard to the Partnership Agreement between the members of the African, Caribbean
and  Pacific  Group  of  States  of  the  one  part,  and  the  European  Community  and  its  Member
States, of the other part, signed in Cotonou on 23 June 2000,2 hereinafter referred to as “the
Agreement”, and in particular Article 2(6)(a) of Annex III thereto,

Having  regard  to the  Internal  Agreement  of 12  September 2000  between  Representatives  of
the  Governments  of  the  Member  States,  meeting  within  the  Council,  on  the  Financing  and
Administration of Community Aid under the Financial Protocol to the Partnership Agreement
between  the  African,  Caribbean  and  Pacific  States  and  the  European  Community  and  its
Member States signed in Cotonou (Benin) on 23 June 2000,

Having regard to the proposal from the Commission, drawn up in agreement with the Centre
for the Development of Enterprise, hereinafter referred to as “the Centre”,

Whereas:

Article 2(6)  of  Annex III to the  Agreement  requires the  Committee of  Ambassadors,
after the signature of the Agreement, to lay down the statutes and rules of procedure of
the Centre, including its supervisory bodies.

The  second  subparagraph  of  Article  1  of  Protocol  2  to  the  Cotonou  Agreement  on
privileges  and  immunities  extends  such  privileges  and  immunities  to  the  staff  of  the
Centre.

An  Executive  Board  should  be  set  up  to  act  as  a  supervisory  body  for  the  Centre,
within the meaning of Article 2(6)(a) of Annex III to the Cotonou Agreement,

2 OJ L 317, 15.12.2000, p. 3.

5

                                                
HAS DECIDED AS FOLLOWS:

Article 1

Subject

1.

2.

3.

1.

2.

1.

2.

3.

1.

The  Centre,  within  the  meaning  of  Annex  III  to  the  Agreement,  shall  be  a  joint
ACP-EC technical body. It shall have legal personality and enjoy, in all states parties
to the Agreement, the most extensive legal capacity accorded to legal persons of the
same kind.

The  Centre’s  staff  shall  enjoy  the  customary  privileges,  immunities  and  facilities
provided  for  in  Protocol 2  on  privileges  and  immunities  and  referred  to  in
Declarations VI and VII annexed to the Agreement.

The Centre shall be  a non-profit body. Its headquarters shall be in  Brussels; it  may
also have offices in ACP countries.

Article 2

Objectives

The  Centre  shall  act  in  accordance  with  the  provisions  and  principles  of  the
Agreement.  It  shall  pursue  the  objectives  specified  in  Article  2  of  Annex III  to  the
Agreement.

The Centre shall define these objectives in greater detail in a policy document.

Article 3

Institutional cooperation

The  Centre’s  cooperation  with  other  bodies  shall  be  guided  by  the  principles  of
coordination,  complementarity  and  added  value  in  respect  of  any  private  sector
development initiatives taken by public or private entities. The Centre shall exercise
selectivity in undertaking its tasks.

The  Centre  may  be  called  on  by  countries  or  regions  to  help  prepare  and  execute
national or regional indicative programmes concerning the private sector.

The Centre may be called on to execute, manage or co-manage special programmes
undertaken by the Commission of the European Communities for ACP countries.

Article 4

Financing

The  Centre  shall  be  financed  by  the  European  Development  Fund,  as  laid  down  in
the  Financial  Protocol  provided  for  in  Annex I  to  the  Agreement,  and  by  its  own
sources of revenue, as set out in the Centre’s financial regulation.

6

2.

3.

The  Centre’s  budget  may  receive  additional  resources  from  other  parties  for  the
purposes of achieving the Centre’s objectives under the Agreement and the strategy
drawn up by the Centre.

The  Centre  may,  in  pursuit  of  its  objectives,  manage  on  behalf  of  third  parties
resources intended for the execution of activities provided for in the Agreement and
benefiting the parties specified in Annex III.

Article 5

Bodies

The  Centre’s  bodies  shall  be  the  Committee  of  Ambassadors,  its  Executive  Board  and  its
Management.

Article 6

Management

1.

2.

3.

4.

5.

6.

The Centre shall be headed by a Director. The Director shall be assisted by a Deputy
Director, who shall answer to the Director and perform operational tasks.

The  Director  and  Deputy  Director  shall  be  recruited  on  the  strength  of  their
management skills and their professional capacity to  accomplish the objectives and
tasks  assigned  to  the  Centre  by  the  Agreement,  and  in  particular  Article 2  of
Annex III thereto.

The Director and Deputy Director shall be appointed by the ACP-EC Committee of
Ambassadors  (hereinafter  “the  Committee)  on  the  basis  of  a  procedure  and  job
descriptions  approved  by  the  Committee  beforehand.  The  appointments  of  the
Director  and  the  Deputy  Director  shall  coincide  with  the  five-year  duration  of  the
EDF Financial Protocol. Their appointments shall be for a maximum period of five
years and shall not be renewable. The posts of Director and Deputy Director shall be
held by ACP and EU nationals in alternation.

The Committee’s Co-Chairs shall sign the letters appointing the Director and Deputy
Director.

The Director shall report to the Centre’s Executive Board.

If necessary, and after carrying out the procedure laid down in the staff regulations,
the  Executive  Board  may  propose,  by  means  of  a  duly  reasoned  proposal,  that  the
Committee dismiss the Director.

If necessary, and after carrying out the procedure laid down in the staff regulations,
the  Executive  Board  may,  at  the  Director’s  proposal,  propose,  by  means  of  a  duly
reasoned proposal, that the Committee dismiss the  Deputy  Director.  The  procedure
for the dismissal of the Deputy Director may also be initiated by the Executive Board
without a prior proposal from the Director.

7

Article 7

The Director’s reponsibilities

The  Director  shall  be  responsible  for  the  Centre’s 
institutional
representation and for the execution of the Centre’s remit and tasks, as defined in the
Agreement and Annex III thereto.

legal  and 

The  Director  shall  be  responsible  for  submitting  the  following  documents  to  the
Executive Board for approval:

– 

– 

– 

– 

the annual and multiannual activity programmes

the Centre’s annual budgets

the annual reports

the organisational structure, personnel policy and organisation chart.

The Director shall be responsible for submitting annual accounts for adoption by the
Executive  Board  and  forwarding  to  the  Committee  for  final  approval.  The
Committee shall be responsible for granting the Director discharge for the execution
of annual budgets.

The  Director  shall  lay  down  the  Centre’s  internal  operating  procedures  and  inform
the Executive Board thereof.

Article 8

Executive Board

The  Executive  Board,  a  supervisory  body  established 
in  accordance  with
Article 2(6)(a)  and  (7)  of  Annex III  to  the  Agreement,  shall  comprise  six  members
from  the  private  sector,  three  of  them  ACP  nationals  and  three  European  Union
nationals.

Each party’s three  members  shall  comprise  representatives  of  financial  institutions,
employers’ associations and sectoral trade associations.

The  six  members  shall  be  appointed  by  the  Committee,  in  accordance  with  the
procedures laid down by the Committee, for a maximum period of five years, with a
review at mid-term.

Meetings of the Executive Board may be attended by an observer from the European
Commission, the General Secretariat of the Council of the European Union, the ACP
Secretariat and the European Investment Bank.

The  members  of  the  Executive  Board  shall  elect  a  Chair  and  a  Deputy  Chair  for  a
maximum period of five years, in accordance with its rules of procedure. The chair
shall be held by the party (ACP or EC) not holding the post of the Centre’s Director.

1.

2.

3.

4.

1.

2.

3.

8

4.

5.

6.

7.

1.

2.

3.

4.

1.

2.

3.

The  Executive  Board  shall  take  decisions  by  a  simple  majority  of  the  members
present or represented, in accordance with its rules of procedure. Each member of the
Executive Board shall have one vote.

In the event of a hung vote, the Chair shall have a casting vote.

Confidential minutes shall be taken of each meeting.

The members of the Executive Board shall be bound, even after leaving office, not to
divulge  information  covered  by  professional  secrecy.  They  shall  neither  seek  nor
take instructions from third parties.

The Executive Board shall adopt its rules of procedures.

Article 9

Members of the Executive Board

The  members  appointed  to  the  Executive  Board  shall  be  persons  with  established
reputations and shall possess an in-depth knowledge of the issues and objectives of
ACP-EU  development  cooperation  and  of  the  machinery  and  instruments  set  up
under the Agreement.

They  must  have  proven  experience  in  the  sector  of  private  enterprise.  They  shall
conduct  their  activities  in  a  manner  consistent  with  their  responsibilities  and  the
Centre’s objectives.

They shall have an in-depth knowledge of English or French.

The position of member of the Executive Board shall be incompatible with any other
activity remunerated by the Centre.

Article 10

Tasks of the Executive Board

The Executive Board shall exercise close supervision over the Centre’s activities. It
shall  hold  up  to  four  ordinary  meetings  a  year.  It  may  also  meet  whenever  the
performance of its tasks demands, at the initiative of the Committee or the Chair or at
the request of the Director.

The  Director  of  the  Centre  shall  take  part  in  the  Executive  Board’s  activities  in  an
advisory  capacity.  The  Centre  shall  provide  secretarial  services  to  the  Executive
Board.

The  Executive  Board  may  invite  other  members  of  the  management  or  staff  of  the
Centre and/or outside experts to give opinions on specific matters.

9

4.

The Executive Board shall:

(a)

advise and support the Director in the management of the Centre and see that
the  rules  and  objectives  laid  down  by  the  Committee  are  being  applied
properly;

(b)

on the proposal of the Director of the Centre:

1.

2.

3.

4.

5.

6.

7.

adopt the Centre’s overall strategy  for submission to the Committee for
approval;

approve annual and multiannual activity programmes;

approve 
organisation chart;

the  organisational  structure,  personnel  policy  and 

the

approve  the  recruitment  of  new  staff  and  the  renewal,  extension  or
termination of the contracts of existing staff;

approve the Centre’s annual budgets;

adopt the annual accounts;

approve  the  annual  reports  and  forward  them  to  the  Committee  so  that
the Committee can verify that the Centre’s  activities are  consistent with
the objectives assigned it by the Agreement and with the overall strategy
adopted.

5.

6.

7.

(c)

report, if necessary, to the Committee on any major issue arising in the exercise
of its duties.

The  Executive  Board  shall  forward  annual  accounts  to  the  Committee  for  final
approval. The Committee shall be responsible for granting the Director discharge for
the annual budgets.

The Executive Board shall be accountable to the Committee.

The  Executive  Board  shall  appoint  a  professional  auditing  company  for  each
financial  year.  That  company  shall  check  that  the  accounts  have  been  drawn  up  in
accordance  with  international  accounting  standards  and  accurately  reflect  the
Centre’s  financial  situation.  It  shall  also  state  whether  the  Centre’s  finances  have
been soundly managed.

Article 11

Committee of Ambassadors

1.

Article 2(6) of Annex III to the Agreement stipulates that:

“The Committee of Ambassadors shall be the supervisory authority of the Centre. It
shall, after the signature of this Agreement:

10

(a)

lay  down  the  statutes  and  rules  of  procedure  of  the  Centre,  including  its
supervisory bodies;

(b)

lay down the statutes relating to staff, financial and staff regulations;

(c)

supervise the work of the bodies of the Centre;

(d)

lay  down  the  rules  of  operation  and  the  procedures  for  the  adoption  of  the
Centre’s budget.”

2.

The Committee shall approve the Centre’s overall strategy on the basis of a proposal
from the Executive Board.

Article 12

Entry into force

These statutes and rules of procedure shall enter into force on the day of their adoption.

Done in Brussels on […]

By the ACP-EC Committee of Ambassadors
The Chair

11

ANNEX II

Proposal for

DECISION N° OF THE ACP-EC COMMITTEE OF AMBASSADORS

concerning the financial regulation of the Centre for the Development of Enterprise

THE ACP-EC COMMITTEE OF AMBASSADORS,

Having regard to the Partnership Agreement between the members of the African, Caribbean
and  Pacific  Group  of  States  of  the  one  part,  and  the  European  Community  and  its  Member
States, of the other  part, signed in Cotonou on 23  June  20003,  hereinafter  referred  to  as  the
Cotonou Agreement and in particular Article 2 (6) of its Annex III,

Having regard to the Internal Agreement of 12 September  2000 between  Representatives of
the  Governments  of  the  Member  States,  meeting  within  the  Council,  on  the  Financing  and
Administration of Community Aid under the Financial Protocol to the Partnership Agreement
between  the  African,  Caribbean  and  Pacific  States  and  the  European  Community  and  its
Member States signed in Cotonou (Benin) on 23 June 2000,

Having regard to the financial regulation applicable to the ninth European Development Fund,

Having regard to the proposal from the Commission drawn up in agreement with the Centre
for the Development of Enterprise,

Whereas the Committee of Ambassadors after the signature of the Cotonou Agreement should
lay down the financial regulation of the Centre for the Development of Enterprise, hereinafter
referred as the centre,

Whereas

(1)

The Committee of  Ambassadors should  lay  down  the  procedures for  the adoption of
the Centre’s budget

3 OJ L 317, 15.12.2000, p. 3.

12

                                                
HAS  ADOPTED  THE  FINANCIAL  REGULATION  OF  THE  CENTRE  FOR  THE
DEVELOPMENT OF ENTERPRISE:

I. GENERAL PRINCIPLES

PRINCIPLES OF UNITY, BUDGET ACCURACY, EQUILIBRIUM AND UNIT OF ACCOUNT

Article 1

1.

2.

All  items  of  revenue  and  expenditure  of  the  Centre  shall  be  included  in  estimates
based on a costed annual work programme to be drawn up for each financial year and
shall be shown in the budget.

The revenue and expenditure shown in the budget shall be in balance.

Article 2

The budget shall be drawn up and implemented in Euro and the accounts shall be presented in
Euro.  However,  for  cash-flow  purposes,  the  accounting  officer  and,  in  the  case  of  imprest
accounts,  imprest  administrators  shall  be  authorised  to  carry  out  operations  in  national
currencies of ACP and EU countries.

Article 3

1.

2.

3.

Revenue  shall  include  the  contribution  by  the  European  Development  Fund,  the
amount  levied  in  taxes  on  the  salaries,  wages  and  other  emoluments  paid  by  the
Centre, and other miscellaneous receipts.

Revenue  may  also  include  contributions  from  other  donors  to  the  budget  of  the
Centre.

In accordance with Article 4 of its Statutes and Rules of Procedure, the Centre may
also  manage  on  behalf  of  third  parties  resources  intended  for  the  execution  of
activities  laid  down  for  it  in  the  Agreement.  The  financial  rules  applicable  to  the
management of these resources are set out in Article 37 of this Financial Regulation.

The  estimates  of  expenditure  shall  include  operating  and  intervention  expenditure.  A  clear
distinction shall be made between them.

Article 4

PRINCIPLE OF ANNUALITY

Article 5

1.

The financial year shall begin on 1 January and end on 31 December of each year.

13

2.

Appropriations entered in the budget shall be authorised for a period of one financial
year.

(a) However,  appropriations  duly  committed  during  a  financial  year  but  not  paid
by  31 December  of  that  year  shall  be  carried  over  automatically  to  the
following financial year only. Appropriations carried over in this way shall be
clearly identified in the accounts of the current year.

(b) Under  certain  conditions  applicable  to  long-term  projects,  the  Director  may
approve  the  carry-over  of  appropriations  for  a  second  consecutive  year.  The
accounts  shall  identify  appropriations  carried  over  in  this  way.  However,  the
Director shall inform the Executive Board of his decision at its next meeting.

(c) At  the  end  of  each  financial  protocol  of  the  Agreement,  any  appropriations
committed but not yet paid out shall be carried over automatically to the next
financial  protocol  of  the  Agreement.  Appropriations  committed  but  not  yet
paid out at the end of the Agreement shall be carried over, but only during the
transitional period  between  this  Agreement  and  the  next  or,  if  applicable,  the
twelve-month winding-up period.

(d)

In  accordance  with  the  rules  applicable  to  the  drawing-up  of  the  budget,
appropriations  that  lapse  at  the  end  of  one  financial  year  shall  be  available
again for subsequent budgets.

3.

If, at the beginning of a financial year, the budget for that year has not been finally
adopted,  the  Director  shall,  in  order  to  ensure  continuity  in  the  operation  of  the
Centre,  authorise  commitment  to,  authorisation  of  and  payment  of  monthly
administrative  and  operating  expenditure  in  accordance  with  the  procedures  laid
down  in  this  Regulation.  Such  monthly  expenditure  for  the  current  year  may  not,
however, exceed one twelfth of the corresponding appropriations, article by  article,
approved in the budget for the preceding year.

PRINCIPLE OF SOUND FINANCIAL MANAGEMENT

Article 6

1.

2.

Budget  appropriations  shall  be  used  in  accordance  with  the  principle  of  sound
financial management, that is to say economy, efficiency and effectiveness.

The  principle  of  economy  requires  that  the  resources  used  by  the  Centre  to
implement its activities shall be made available in due time, in appropriate quantity
and quality and at the best price.

The principle of efficiency is concerned with the best relationship between resources
employed and results achieved.

The principle of effectiveness is concerned with attaining the specific objectives set
and achieving the intended results.

3.

Specific,  measurable,  achievable,  relevant  and  timed  objectives  shall  be  set  for  all
sectors of activity covered by the budget. Achievement of those objectives shall  be

14

monitored  by  performance  indicators  for  each  activity,  and  information  shall  be
provided to the Executive Board by the Director. This information shall be provided
annually  at  the  latest  in  the  documents  accompanying  the  preliminary  draft  budget
and  should  be  provided  along  with  the  documents  supplied  to  the  Commission
justifying the annual amount requested by the Centre from the EDF.

4.

In order to improve decision-making, the Centre shall regularly carry out ex ante and
ex  post  evaluations  of  programmes  or  activities  in  accordance  with  a  multi-annual
programme of evaluation to be fixed in agreement with the Commission. Evaluation
results shall be included in the documents supplied to the Commission justifying the
annual amount requested by the Centre from the EDF.

II. ESTABLISHMENT OF THE BUDGET

1.

2.

3.

4.

1.

2.

Article 7

Within  the  limits  of  the  overall  budget  allocated  to  the  Centre  by  the  financial
protocol, increased by possible contributions from other donors, and on the basis of
the  guidelines  laid  down  by  the  strategy  approved  by  the  Committee,  the  Director
shall draw up a draft annual work programme and related budget. This draft shall be
forwarded  to  the  Executive  Board  no  later  than  15  July  of  the  year  preceding  its
implementation.

The annual work programme and related budget shall be approved by the Executive
Board by 31 July at the latest. The document shall be forwarded to the Commission
of  the  European  Communities,  which  shall  initiate  the  Community  procedures  in
force as regards the contribution requested from the European Development Fund, on
the basis of the separate allocation provided for this purpose.

The  budget  shall  only  be  available  for  commitment  as  from  the  date  on  which  the
competent  Community  authority  takes  the  financing  decision  on  the  contribution
requested  from  the  European  Development  Fund.  The  Centre  shall  be  informed  of
this decision.

The  terms  and  conditions  applicable  to  the  contribution  from  the  European
Development  Fund  shall  be  fixed  in  a  financing  agreement  signed  between  the
Centre and the Commission.

The budget shall include proper estimates of revenue from other donors.

Article 8

The dates for the payment of the contribution from the European Development Fund
shall be fixed in the financing agreement referred to in Article 7 (3). The contribution
from preceding financial years representing lapsed appropriations shall be deducted.

The  budget  shall  be  subdivided  into  titles  (budget  headings),  chapters,  articles  and
items according to the nature or purpose of the revenue or expenditure.

15

Article 9

Where necessary the Director shall submit a draft supplementary or amending budget, which
shall be examined and approved in the same form and according to the same procedures as the
budget containing the original estimates.

III. IMPLEMENTATION OF THE BUDGET

1.

2.

1.

2.

Article 10

The  Director  shall  implement  the  budget  on  his  own  responsibility  and  within  the
limits of the appropriations authorised. He shall report to the Executive Board on the
administration of the budget.

The  authorised  appropriations  shall  be  used  only  in  accordance  with  the  principles
and rules laid down in the present regulation and in particular the principle of sound
financial management as defined in Article 6.

Article 11

No revenue shall be collected  or  expenditure effected unless credited to or  charged
against an appropriate article in the budget.

No  expenditure  may  be  committed  or  authorised  in  excess  of  the  appropriations
authorised for the financial year concerned or of the appropriations carried over from
previous financial years.

Revenue  and  expenditure  shall  be  entered  in  full  in  the  accounts  without  any
adjustment against each other.

By  way  of  derogation  from  this  rule,  the  following  shall  be  deducted  from  the
amounts authorised:

(a)

fines imposed on a party to a contract;

(b)

(c)

adjustment  of  amounts  paid  in  error,  which  may  be  achieved  by  means  of
deduction  when  a  subsequent  validation  is  effected  under  the  chapter,  article
and financial year in respect of which the excess payment was made;

the value of vehicles, equipment and installations, taken in part exchange upon
purchase of new items of the same kind; the net purchase price shall be entered
in the accounts as the historical cost for the valuation of the inventory.

Again by way of derogation from this rule, the following amounts may be reused:

(a)

refunds of amounts paid in error;

(b)

insurance payments received;

(c)

proceeds  from  the  sale  of  vehicles,  equipment  and  installations  disposed  of
when replaced;

16

(d)

proceeds from the sale of CDE publications.

Article 12

1.

2.

Transfers  from  one  title  to  another  shall  be  decided  by  the  Director,  except  where
transfers  from  or  to  articles  related  to  staff  emoluments  are  concerned.  He  shall
inform the Executive Board of his decisions at its next meeting.

Transfers  from  one  title  to  another  where  articles  related  to  staff  emoluments  are
concerned shall be decided by the Executive Board, on the basis of a proposal from
the Director.

Transfers  from  one  chapter  to  another  and  within  chapters  shall  de  decided  by  the
Director, who shall inform the Executive Board accordingly.

Article 13

The revenue of the Centre shall be paid into one or more accounts opened in the name of the
Centre.

IV. FINANCIAL CONTROL

Article 14

1.

2.

3.

4.

The  financial  control  shall  be  composed  of  a  financial  controller  and,  if  necessary,
one  or  more  assistant  controllers,  who  must  all  be  experienced  in  the  financial
regulations of international organisations.

The controller shall report for administrative purposes directly to the Director and the
assistant controllers shall report directly to the controller.

The  controller  and  the  assistant  controllers  shall  be  appointed  by  the  Executive
Board.  The  controller  and  the  assistant  controllers  shall  be  bound  by  the  Staff
Regulations  in  force.  However,  any  measures  relating  to  disciplinary  action,
suspension, termination of employment or legal proceedings must be endorsed by the
Executive Board, on the basis of a fully substantiated proposal from the Director.

Before  any  operation  is  authorised  by  an  authorising  officer,  the  operational  and
financial aspects shall be verified by the financial control.

The purpose of this verification shall be to ascertain that:

(a)

the expenditure is in order and conforms to the relevant provisions;

(b)

the principle of sound financial management referred to in Article 6 has been
applied.This verification shall result in the granting or withholding of approval.

The  financial  control  shall  withhold  its  approval  if  it  considers  that  the  above
conditions  are  not  fulfilled.  In  each  case  where  approval  is  withheld,  the  financial

17

control  shall  make  a  written  statement,  stating  the  full  reasons  therefor,  and  shall
notify the Director.

Except where the availability of the appropriations is in doubt, the Director may, by a
decision stating the full reasons therefor and taken on his sole responsibility, overrule
such a refusal. This  decision  shall be final and binding and shall  be  communicated
for  information  to  the  financial  control.  The  Director  shall  inform  the  Executive
Board of all such decisions in writing at its next meeting. The financial control shall
have  access  to  all  the  supporting  documents  and  to  any  other  document  relating  to
the expenditure and revenue to be verified. It may carry out verifications on the spot.

In  carrying  out  their  duties,  the  controller  and  the  assistant  controllers  shall  enjoy
complete  independence.  They  shall  not  receive  any  instruction  nor  have  any
restriction imposed with regard to carrying out the duties assigned to them by virtue
of the provisions of the Financial Regulation as a consequence of their appointment.

The Director may request the financial control to give its opinion on matters relating
to  the  diagnosis,  organisation  or  improvement  of  the  Centre’s  internal  procedures.
The  Director  may  also  request  the  financial  control  to  carry  out  verifications  of
documents and, where appropriate, on-the-spot verifications to check that operations
financed by the budget have been correctly implemented.

At the end of each financial year, and no later than 30 April of the following year, the
financial control shall prepare an activity report in which it gives its opinion on the
financial  management  and  on  the  implementation  of  the  budget.  It  shall  submit  its
report to the Director, who shall forward it, along with his comments if necessary, to
the Executive Board at its next meeting.

5.

6.

7.

Article 15

The  external  auditors  referred  to  in  Article  27  shall  express  independent  opinions  on  the
quality of the management and control systems.

V. ADMINISTRATION OF THE BUDGET

Article 16

1.

2.

3.

The budget of the Centre shall be administered in accordance with the principle that
authorising officers and accounting officers are different individuals.

The duties of authorising officer, controller and accounting officer shall be mutually
incompatible.

The appropriations shall be administered by the authorising officer, who alone shall
be  empowered  to  enter  into  commitments  regarding  expenditure,  determine
entitlements  to  be collected  and  issue  recovery  and payment  orders. Collection and
payment operations shall be carried out by the accounting officer.

18

Article 17

1.

2.

3.

All  measures  which  may  give  rise  to  expenditure  payable  by  the  Centre  shall  be
preceded by a proposal for commitment from the authorising officer. The proposal,
accompanied  by  the  original  supporting  documents,  shall  be  sent  to  the  financial
control for prior verification.

A provisional commitment may be entered into in respect of recurrent expenditure.

An account shall be kept of commitments and payment orders.

1.

The purpose of validation of expenditure by the authorising officer shall be:

Article 18

(a)

to verify the existence of the rights of the creditor;

(b)

to determine or verify the existence and the amount of the debt;

(c)

to verify the conditions under which payment falls due.

2.

1.

2.

3.

4.

1.

2.

Validation  of  any  expenditure  shall  be  subject  to  the  submission  of  supporting
documents showing the creditor’s claim and, where appropriate, the service rendered.

Article 19

Authorisation  is  the  act  whereby  the  authorising  officer,  by  the  issue  of  a  payment
order,  instructs  the  accounting  officer  to  pay  an  item  of  expenditure  which  he  has
validated.

The  payment  order  shall  be  accompanied  by  the  original  supporting  documents,
which  shall  bear  or  be  accompanied  by  the  approval  of  the  authorising  officer
confirming  that  the  amounts  to  be  paid  are  correct,  that  the  supplies  have  been
received or that the service has been performed.

Copies  of  the  supporting  documents,  certified  as  true  copies  by  the  authorising
officer may, in some cases, be accepted in place of the originals.

Payment orders shall be sent to the financial control for prior verification.

Article 20

Payment  is  the  final  action  whereby  the  Centre  is  discharged  of  its  obligations
towards its creditors.

Payment  shall  be  made  by  the  accounting  officer  within  the  limits  of  the  funds
available.

In the event of a substantive error or of the validity of the discharge being contested
or  of  failure  to  observe  the  formalities  prescribed  by  this  Financial  Regulation,  the
accounting officer shall immediately inform the authorising officer and the financial

19

control.  The  Director  may  require  in  writing,  and  on  his  own  responsibility,  that
payment  is  made.  The  Director  shall  inform  the  Executive  Board  of  all  such
decisions in writing at its next meeting.

Article 21

Payments  shall,  as  a  general  rule,  be  made  through  a  bank  account,  preferably  by
bank  transfer  or,  where  good  grounds  exist,  by  cheque.  The  transactions  shall  be
denominated in Euro. In exceptional cases, and if appropriate, another currency may
be used.

Cheques  and  bank  transfer  orders  shall  bear  two  signatures,  one  of  which  must  be
that of the accounting officer.

For duly substantiated reasons, the Director may authorise cash payments. A receipt
shall be obtained in respect of those payments.

In the absence of the actual exchange rates used, the conversion rates to be used for
the calculation in Euro of payments to be made, or of revenue to be collected in local
ACP  currencies,  shall  be  those  in  force  on  the  first  working  day  of  the  month  in
which the real date of the operation falls, as recorded by the European Central Bank.

Article 22

For the payment of certain categories of expenditure, imprest accounts may be set up
in accordance with the conditions laid down by the Centre.

Each decision to grant an imprest account shall be taken by the Director on the basis
of a proposal from the staff member in charge of the file. Prior to submission to the
Director,  each  proposal  must  be  approved  by  the  accounting  officer  and  agreed  by
the financial control.

1.

2.

3.

4.

1.

2.

3.

Each decision shall specify:

– 

– 

– 

– 

– 

the name of the imprest administrator

the responsibility of the administrator so designated

the maximum amount of the advance

the duration of the utilisation of the advance

the means whereby supporting documents shall be provided and the time
limit for so doing

4.

5.

– 

the nature and maximum amount of each item of expenditure.

Each payment of an advance must also be preceded by a commitment.

The  authorising  officer  and  the  accounting  officer  shall  take  whatever  steps  are
necessary to ensure that clearances in respect of the advances granted are issued for
the correct amounts and within an appropriate lapse of time.

20

Article 23

1.

2.

3.

The  Director  shall  be  the  authorising  officer  for  the  appropriations  entered  in  the
budget of the Centre.

The Director may delegate some of his duties to staff members under his authority.
Each decision to delegate powers shall state the duration and extent of the mandate to
act as authorising officer.

The  Director  may  delegate  certain  duties  related  to  implementation  to  carefully
selected appropriate third parties.

Accounting officer

Article 24

1.

2.

3.

4.

5.

6.

The  accounting  officer  shall  be  appointed  by  the  Director  with  the  endorsement  of
the Executive Board.

He shall be responsible in the Centre for:

(a)

proper  implementation  of  payments,  collection  of  revenue  and  recovery  of
amounts established as being receivable;

(b)

preparing and presenting the accounts in accordance with Article 26;

(c)

keeping the accounts in accordance with Article 26;

(d)

(e)

implementing, in accordance with Article 26, the accounting rules and methods
and  the  chart  of  accounts  in  accordance  with  the  provisions  adopted  by  the
Commission’s accounting officer;

laying  down  and  validating  the  accounting  systems  and  where  appropriate
validating  systems  laid  down  by  the  authorising  officer  to  supply  or  justify
accounting information;

(f)

treasury management.

The accounting officer shall obtain from the authorising officer, who shall guarantee
its  reliability,  all  the  information  necessary  for  the  production  of  accounts  which
accurately represent the Centre’s financial assets and budget implementation.

Subject  to  paragraph  5  of  this  Article  and  Article  22,  the  accounting  officer  is  the
only person empowered to manage monies and other assets. He shall be responsible
for their safekeeping.

The accounting officer may delegate certain tasks to subordinates subject to the Staff
Regulations, where this is indispensable for the performance of his duties.

The instrument of delegation shall lay down the tasks entrusted to  the subordinates
and their rights and obligations.

21

Article 25

1.

2.

3.

The recovery of any sum due to the Centre shall give rise to the issue of a recovery
order  by  the  authorising  officer.  Recovery  orders  shall  be  submitted  to  the  internal
control body for prior verification.

The accounting officer shall assume responsibility for recovery orders forwarded to
him by the authorising officer.

A  receipt  shall  be  issued  in  respect  of  all  cash  payments  made  to  the  accounting
officer or imprest administrator.

VI.  ACCOUNTS,  RENDERING  AND  CHECKING  OF  FINANCIAL
STATEMENTS, AUDIT, COURT OF AUDITORS, OLAF

1.

2.

3.

4.

5.

Article 26

The accounts shall be kept in Euro, by the double entry method and on the basis of
the  calendar  year.  They  shall  show  all  revenue  and  expenditure  from  1  January  to
31 December of each year and shall include the original supporting documents.

The accounts shall be closed at the end of the  financial  year to enable  the  Centre’s
financial statements to be drawn up.

Entries  shall  be  made  on  the  basis  of  an  accounting  system  comprising  a
nomenclature  of  budgetary  items  which  makes  a  clear  distinction  between  the
accounts  that  permit  the  balance  sheet  to  be  drawn  up  and  those  that  permit  the
revenue and expenditure account to be drawn up. These entries maybe recorded in a
computerised  system,  which  will  make  it  possible  to  draw  up  a  general  monthly
balance. All imprest shall be entered in a suspense account and cleared no later than
the end of the following financial year, except in the case of standing imprest.

When  the  authorising  officer,  the  controller  and  the  accounting  officer  consider  by
mutual agreement that the system offers guarantees that satisfy requirements in terms
of security, the Centre may use electronic processing.

The separate accounts kept for the resources managed on behalf of third parties,  as
provided for in Article 37, shall be consolidated in the balance sheet and the revenue
and expenditure account of the Centre.

The Centre shall draw up a balance sheet and a revenue and expenditure account no
later than 31 March of year N+1.

The balance sheet shall show the assets and liabilities of the Centre at 31 December
of the financial year N.

The revenue and expenditure account shall include:

(a) A “Revenue” table comprising:

22

– 

– 

– 

expected  receipts  from  the  European  Development  Fund  based  on
approved  commitments  of  the  current  year  and  those  carried  over  from
previous years;

actual receipts from taxes on salaries and from interest earned;

other actual receipts.

(b) An “Expenditure” table comprising:

– 

– 

– 

– 

actual payments on commitments of the year carried over from previous
financial years;

actual  payments  or  commitments  charged  against  the  budget  of  the
year N

a  summary  table  showing  actual  payments  for  furniture,  equipment  and
other inventory items;

authorised  commitments  to  be  carried  over  to  the  following  financial
year.

(c) Notes on the financial statements comprising:

– 

– 

– 

accounting principles applied;

summary tables of appropriations committed, paid, cancelled and carried
over in respect of the preceding and current years;

detailed  notes  and  calculations  in  support  of  the  line  items  in  the
statements.

6.

Each  quarter  a  statement  shall  be  drawn  up  showing  the  situation  as  regards
implementation of the current budget and use of the appropriations carried over; this
statement shall be certified by the  financial control  and  forwarded to the  Executive
Board.

External auditors

Article 27

1.

2.

The Executive Board shall appoint a professional firm of auditors for each financial
year  to  audit  the  financial  statements  of  the  Centre.  However,  the  same  firm  of
auditors cannot be appointed for more than three consecutive years.

The auditors shall audit the books and the cash held at the the Centre, verify that the
inventories and balance sheets have been drawn up in a proper manner and in good
faith,  in  accordance  with  proper  accounting  procedures,  and  ensure  that  the
information regarding the accounts of the Centre is correct.

The purpose of the audit shall be to establish that all revenue due has been received
and  all  expenditure  incurred  in  a  lawful  and  proper  manner  and  that  the  financial
management has been sound.

23

3.

4.

5.

The  auditors  shall  certify  that  the  financial  statements  have  been  drawn  up  in  a
proper  manner  according  to  international  accounting  standards,  and  that  they
represent a true and fair view of the financial position of the Centre.

The  auditors  shall  advise  the  Centre  on  dealing  with  risks  by  issuing  independent
opinions  on  the  quality  of  management  and  control  systems  and  by  issuing
recommendations for improving the conditions of implementation of operations and
promoting sound financial management.

The auditors shall be responsible for:

(a)

assessing the suitability and effectiveness of internal management systems and
the  performance  of  the  Centre  in  implementing  programmes  and  actions  by
reference to the risks associated with them; and

(b)

assessing  the suitability  and quality  of the  internal control  systems  applicable
to every budgetary implementation operation.

The auditors shall perform their duties on all the Centre’s activities and units. They
shall  enjoy  full  and  unlimited  access  to  all  information  required  to  perform  their
duties.

After the close of each financial year the auditors shall draw up a report by 30 June at
the latest. This report shall be forwarded to the Director, who shall in turn forward it,
with his comments if necessary, to the Executive Board. The Executive Board shall
then forward the report to the Committee with its recommendations.

On the basis of this report and the financial statements, the Committee shall give the
Director a discharge in respect of the implementation of the budget.

Article 28

The  Commission  [on  behalf  of  the  Community],  the  Court  of  Auditors  and  OLAF  may
undertake checks on the financing  received by the Centre from the EDF in accordance with
the EDF Financial Regulation.

The Court of Auditors may check that revenue has been received and expenditure incurred in
a lawful and proper manner and that the provisions of the Cotonou Agreement and that of the
financial regulation of the 9th EDF have been respected.

VII.  RESPONSIBILITIES  OF  THE  AUTHORISING  OFFICERS,
ACCOUNTING  OFFICER,  ASSISTANT  ACCOUNTING  OFFICERS
AND IMPREST ADMINISTRATORS

Article 29

Authorising  officers  who,  when  determining  entitlements  to  be  recovered,  issuing  recovery
orders, entering into a commitment of expenditure or signing a payment order, do so without
complying with this Financial Regulation, shall render themselves liable to disciplinary action
and, where appropriate, to payment of compensation. The same shall apply if they fail to draw

24

up  a  document  establishing  a  debt  or  if  they  neglect  to  issue  recovery  orders  or  are  late  in
issuing them without justification.

Such  liability  may  only  be  invoked  when  the  fault  was  committed  intentionally  or  was  the
result of serious negligence.

Article 30

1.

The  accounting  officer  and  assistant  accounting  officers  shall  render  themselves
liable to disciplinary action and, where appropriate, to payment of compensation as
regards payments made by them in disregard of Article 19.

They  shall  render  themselves  liable  to  disciplinary  action  and  to  payment  of
compensation as regards any loss or damage of the monies, assets and documents in
their keeping, where such loss or damage was caused intentionally or was the result
of serious negligence on their part.

Under  the  same  conditions,  they  shall  be  responsible  for  the  correct  execution  of
orders  received  by  them  in  respect  of  the  use  and  the  administration  of  the  bank
accounts, and in particular:

(a) where  they  recover  or  pay  amounts  that  are  not  in  conformity  with  the

corresponding recovery or payment orders;

(b) where they make payments to persons other than those entitled.

2.

Imprest  administrators  shall  render  themselves  liable  to  disciplinary  action  and,
where appropriate, to payment of compensation in the following cases:

(a) where they cannot provide proper supporting documents for payments made by

them;

(b) where they make payments to persons other than those entitled.

They shall be liable to disciplinary action and to payment of compensation in respect
of any loss or damage of the monies, assets and documents in their keeping, where
such loss or damage was caused intentionally or was the result of serious negligence
on their part.

Article 31

1.

The accounting officer, assistant accounting officers and imprest administrators shall
be insured against the risks inherent in their respective duties.

The  Centre  shall  cover  the  insurance  costs  relating  thereto.  It  shall  specify  the
categories  of  staff  members  serving  as  accounting  officer,  assistant  accounting
officers and imprest administrators, as well as the conditions subject to which it will
cover the insurance costs borne by the said staff members to guard against the risks
inherent in their duties.

25

2.

3.

Special  allowances  shall  be  granted  to  the  accounting  officer,  assistant  accounting
officers and imprest administrators. The level of these allowances shall be laid down
in  a  regulation  drawn  up  by  the  Centre.  The  amounts  corresponding  to  these
allowances  shall  be  credited  each  month  to  an  account  opened  by  the  Centre  on
behalf of each of these staff members in order to establish a guarantee fund for the
purpose of covering any loss for  which  the  person  concerned  might  render  himself
liable,  insofar  as  such  a  loss  has  not  been  covered  by  refunds  from  insurance
companies.

The credit balance in these guarantee accounts shall be paid to the persons concerned
after the end of their appointment as accounting officer, assistant accounting officer
or impress administrator and after they have received the final discharge in respect of
their management.

The  discharge  to  the  accounting  officer,  assistant  accounting  officer,  assistant
accounting  officer  of imprest administrator will  be  given by  the  Director,  based  on
the external auditors’ report within two years  after the  closing  of the financial  year
concerned.

Article 32

The liability to payment of compensation and to disciplinary action of the authorising officers,
accounting  officer,  assistant  accounting  officers  and  imprest  administrators  shall  be
determined in accordance with the Staff Regulations of the Centre.

VIII. PROCUREMENT PROCEDURES AND OTHER PROVISIONS

Article 33

A.

APPLICABLE PROCUREMENT RULES

The award of contracts  to be  concluded  by  the  Centre  for  the  supply  of  goods  and  services
shall  be  governed  by  the  provisions  of  this  Article,  supplemented  as  necessary  by  the
provisions of the Agreement and the General Regulations adopted on its basis by the ACP-EC
Council  of  Ministers  and  by  the  rules  concerning  the  award  of  contracts  in  the  Financial
Regulation  applicable  to  the  European  Development  Fund;  i.g  the  candidates  must  be
nationals  of  Member  States  of  the  Community  or  of  the  ACP  States,  except  in  duly
substantiated cases accepted by the Director.

In the event of conflict, the latter rules, as amended, shall apply.

B.

DEFINITIONS

The following definitions shall apply for the purposes of this Article:

1.

“Direct agreement”

Procedure in which the Centre consults the candidate of its choice and negotiates the
terms of the contract with him.

26

2.

“Simplified procedure”

Procedure without prior publication of a notice and terms of reference in which only
candidates (a minimum of three) invited by the Centre may submit tenders.

3.

“Negotiated procedure”

Procedure without prior publication of a notice and terms of reference in which the
Centre consults the candidate or candidates of its choice and negotiates the terms of
the contract with one or more of them. One of the conditions set out in point C.1 (e)
below must apply.

4.

“Restricted invitation to tender without publication of a notice”

Procedure in which only candidates invited by the Centre on the basis of its data file
of suppliers may submit  a  tender  in  response  to terms of reference prepared  by the
Centre.

5.

“Restricted invitation to tender with publication of a notice”

Procedure  in  which  only  candidates  invited  by  the  Centre  may  submit  a  tender  in
response to the notice and terms of reference published by the Centre.

6.

“Open invitation to tender”

Procedure in which any natural or legal person or group thereof may submit a tender
in response to the notice and terms of reference published by the Centre.

C.

1.

CONTRACTS WITH SUPPLIERS OF GOODS AND SERVICES

Supply contracts

(a) Contracts  relating  to  the  purchase  or  hire  of  supplies,  equipment  or  movable
property shall be concluded following an open tender. The candidates must be
nationals of Member States of the Community or of the ACP States, except in
duly substantiated cases accepted by the Director.

(b) They  may  be  concluded  by  direct  agreement  (a  single  offer)  when  the  total

amount of the contract does not exceed €4 999.

(c)

They may be concluded by a simplified procedure, with at least three suppliers
being consulted, when the total amount of the contract is between €5 000 and
€29 999.

(d) They may  be concluded after  a  restricted  invitation  to  tender  to  at  least  three
candidates,  without  publication  of  a  notice,  when  the  total  amount  of  the
contract is between €30 000 and €149 999.

(e)

They  may  be  concluded  by  a  negotiated  procedure,  after  agreement  by  the
Director and on the basis of a duly-substantiated file, when the amount of the
contract exceeds €4 999 and one of the following conditions applies:

1.

for reasons of urgency that are not attributable to the Centre;

27

2.

3.

when there are specifically technical and duly substantiated reasons;

when  the  contract  is  for  ancillary  supplies,  services  or  work  that,  for
technical reasons, cannot be separate from the main contract;

4.

when the invitation to tender has proved unsuccessful.

The conditions in which these derogations may be approved shall be specified in an
internal directive.

2.

Contracts for the provision of services

(a) Contracts relating to the  provision  of services  shall  be  concluded  following  a
restricted  invitation  to  tender  to  at  least  three  candidates.  These  candidates
must be nationals of Member States of the Community or of the ACP States,
except in duly-substantiated cases accepted by the Director.

(b) They may be concluded by direct agreement when the total cost of the services

to the Centre does not exceed €4 999.

(c)

They may be concluded by a simplified procedure, with at least three suppliers
being  consulted,  when  the  total  cost  of  the  services  to  the  Centre  is  between
€5 000 and €199 999. However, for contracts between €150 000 and €199 999
the consultation shall take place on the basis of detailed terms of reference.

(d) They  may  be  concluded  by  a  negotiated  procedure  after  agreement  by  the
Director and on the basis of a duly substantiated file, when the amount of the
contract  exceeds  €4 999  and  one  of  the  conditions  set  out  in  point  C.  1(e)
applies.

The  contractor  shall  be  selected  on  the  basis  of  the  price  quoted,  evidence  of
professional  competence,  experience  and  financial  soundness,  and  the  time  limit
proposed for completion of the contract.

Contracts shall be drawn up exclusively in Euro.

In  cases  where  the  services  covered  by  the  above  points  1  and  2  are  split  up  into
several  contracts,  it  is  the  total  cost  of  the  services  that  must  be  taken  into
consideration in application of this article.

In  specific  cases,  the  Centre  may  delegate  the  organisation  of  the  simplified
procedures and invitations to tender to an external body, provided that the choice of
the  companies  contacted,  the  terms  of  reference  and  the  selection  of  the  contractor
remain its sole responsibility or, in the event of co-financing, the joint responsibility
of the Centre and the other co-financiers.

3.

4.

5.

6.

The  Centre  may  make  financial  contributions  to  initiatives  of  enterprises,  entrepreneurs,
intermediaries and service suppliers, as follows:

Article 34

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1.

2.

3.

4.

5.

1.

2.

3.

4.

The Centre may contribute to the cost of services for eligible projects for which the
financing and management responsibility are incumbent on a natural or legal person
who is a national of a Member State of the Community or of an ACP State and who
has submitted a request for assistance to the Centre.

The Centre shall assess the cost of the services, the choice of suppliers, evidence of
professional  competence,  experience  and  financial  soundness,  the  time  limit  for
completion of the work, and the expected impact of the programme proposed by the
beneficiary.

If he is subcontracting, the beneficiary shall comply with Article 33.

The agreements shall be drawn up exclusively in Euro.

The methods of applying these contributions shall be set out in an internal directive.

Article 35

A  permanent  inventory  shall  be  kept  of  all  movable  and  immovable  property
belonging to the Centre. Only movable property whose value is €350 or more shall
be entered in the inventory. The inventory number shall be entered on each invoice
before the latter is paid.

Any sale of movable  property  and equipment  of a unit purchase value in excess of
€1 000  shall  be  suitably  advertised,  in  accordance  with  an  internal  directive  to  be
drawn up by the Director.

A record  signed by  both  the  Director and the person  responsible  for the  equipment
and  certified  by  the  internal  control  shall  be  drawn  up  whenever  any  property  or
article in the inventory is disposed of, scrapped or is found to be missing on account
of loss or theft, or for any other reason.

The  Centre  shall  keep  a  physical  and  an  accounting  inventory,  which  shall  be
reconciled  on  a  regular  basis.  This  reconciliation  shall  be  cleared  by  the  internal
control body.

Article 36

This Financial Regulation shall be applicable in full to the Centre’s decentralised structures.

IX. MANAGEMENT ON BEHALF OF THIRD PARTIES

Article 37

1.

2.

The Centre may also manage resources  intended  for the  execution of  activities  laid
down  for it  in the  Agreement on  behalf of third  parties. The  list  of  these  resources
shall be given in an annex to the budget of the Centre.

This Financial Regulation shall be applicable to the management of these resources.

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However,  the  management  of  the  other  resources  made  available  by  the  European
Commission  shall  be  governed  by  the  financial  provisions  laid  down  in  the
agreement signed by the Commission and the Centre. If there are no such provisions,
the Financial Regulation of the Centre shall remain applicable.

Proper estimates of the expenses that will be financed by these resources shall also
be  annexed  to  the  budget  of  the  Centre.  A  clear  distinction  shall  be  made  between
operating and intervention expenses.

Separate accounts shall be kept for the management of these resources on behalf of
third parties.

The  financial  statements  of  each  fund  managed  by  the  Centre  on  behalf  of  a  third
party shall include a balance sheet and a revenue and expenditure account, indicating
the  situation  as  at  31  December  of  the  financial  year  concerned.  They  shall  be
certified  in  accordance  with  the  provisions  of  the  agreement  signed  between  the
Centre and the donor.

If there are no such provisions, the certification shall be carried out by the financial
control of the Centre.

These financial statements shall be attached as an annex to the financial statements of
the Centre.

3.

4.

5.

6.

The ACP States, the Member States and the Community shall be bound, each to the extent to
which it is concerned, to take the measures necessary to implement this Decision.

Article 38

Article 39

This Decision shall enter into force on the day of its adoption.

Done at Brussels,

For the Committee of Ambassadors l
The President

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