REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT Eleventh Annual Report 2016 on the implementation of Community assistance under Council Regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of financial support for encouraging the economic development of the Turkish Cypriot community
Date: 2017-07-07
Institutions: European Commission, Secretariat-General
Subjects: Cyprus, EU aid, EU programme, activity report, civil society, development aid, economic development, financial aid, national unification, social development

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 7.7.2017  COM(2017) 372 final   REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT Eleventh Annual Report 2016 on the implementation of Community assistance under Council Regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of financial support for encouraging the economic development of the Turkish Cypriot community  
 
 
REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN 
PARLIAMENT 

Eleventh Annual Report 2016 on the implementation of Community assistance under 
Council Regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of 
financial support for encouraging the economic development of the Turkish Cypriot 
community 

1. 

INTRODUCTION 
Council  Regulation  (EC)  No  389/20061  (the  "Aid  Regulation")  is  the  basis  for  the 
provision of assistance to the Turkish Cypriot community (TCc) and requires annual 
reporting  to  the  Council  and  the  European  Parliament.  This  report  covers  the  year 
2016. 

2. 

PROGRAMMING OF THE ASSISTANCE 

Between  2006  and  the  end  of  2016,  EUR  450.2  million  was  programmed  for 
operations under the Aid Regulation. The amount committed in December 2016 for 
the  2016  annual  programme  was  EUR  33,408,3922.  The  Multiannual  Financial 
Framework  (MFF)  2014-20  provides  a  multi-annual  perspective  to  the  programme 
with a provision for stable, annual funding. The assistance programme is, however, 
temporary in nature, aiming to facilitate the reunification of Cyprus, and both the Aid 
Regulation and Council Regulation No 1311/2133 laying down the MFF allow for a 
revision in case of reunification.  

3. 

IMPLEMENTATION MECHANISMS  

The programme is implemented in the areas of the Republic of Cyprus in which the 
Government of the Republic of Cyprus does not exercise effective control and where 
the application of the acquis is temporarily suspended pursuant to Protocol 10 of the 
through  direct 
Treaty  of  Accession.  Assistance 
management by the European Commission, but some projects are indirectly managed 
by  the  United  Nations  Development  Programme  (UNDP),  the  European  Bank  for 
Reconstruction and Development (EBRD) or the British Council.  

implemented  primarily 

is 

The Commission operates in a unique political, legal and diplomatic context. Ad hoc 
arrangements  are  needed  to  implement  the  programme  while  respecting  the 
principles of sound financial management. In EU-funded aid programmes, in normal 
circumstances,  agreements with a beneficiary  government would establish the legal 
framework  for  development  assistance.  No  such  agreements  can  be  made  for  the 
assistance to the TCc. Management and mitigation of the inherent risk is part of the 
Commission's  responsibility  and  measures  adopted  include  intensive  monitoring  of 
contracts and provision of support to beneficiaries, revised payment conditions and a 
careful approach to the use of bank guarantees. The assistance includes a significant 
amount of grant support, requiring resource-intensive management.  

To  ensure  successful  and  sustainable  implementation  in  this  environment,  the  TCc 
must fully engage in the preparation for the acquis roll-out following settlement.  

1 
2 
3  

OJ L65, 7.3.2006, p.5. 
Commission Decision C(2016) 6688.  
OJ L347, 2.12.2013, p.884. 

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The Programme Team operates through the EU Programme Support Office (EUPSO) 
in  the  northern  part  of  Nicosia.  The  Representation  of  the  Commission  in  Cyprus 
also  hosts  meetings,  seminars  and  press  conferences  and  communicates  with  the 
Cypriot public throughout the island, including on the Aid Programme, and also via 
the EU infopoint that is itself funded under the Aid Programme. 

4. 

IMPLEMENTATION DURING THE REPORTING PERIOD 

4.1. 

General overview 

The Commission continues to implement the Aid Regulation with the overall aim of 
supporting reunification. The Commission stands ready to adapt the programme as a 
result  of  any  agreements  reached  in  the  settlement  talks,  and  action  was  taken  to 
finance the opening of two new crossing points as a confidence building measure.  

Operations  in  2016  included  the  continuation  of  a  number  of  established  and 
successful  projects,  such  as  EU  scholarships  and  confidence  building  measures  in 
support to the Committee on Missing Persons (CMP) and the Technical Committee 
on Cultural Heritage (TCCH).  

Assistance  provided  to  key  economic  sectors  preparing  for  a  settlement  was 
reinforced through projects for the development of the private sector, and rural and 
human resources. 

Considerable  gaps  in  the  capacity  of  the  beneficiaries  to  effectively  implement  the 
acquis still exist, and extensive adaption is required to reach this goal. However, the 
TCc has a firmer understanding of the challenges. 

Grant  support  remains  an  essential  element  of  the  programme.  The  Commission 
continued  to  make  recourse  to  outsourcing,  to  help  ensure  that  grants  reach  the 
beneficiaries in a timely and efficient manner. 

Since 2008, a Project Management Unit (PMU) set up through a technical assistance 
service contract has been providing services to support the implementation of grant 
schemes. This PMU continues to offer valuable help to the Commission in terms of 
increased  efficiency  and  assurance  in  the  operational  management,  implementation 
and monitoring of grant schemes.  

One  continuing  issue  concerns  the  construction  of  the  Famagusta  sewage  network, 
which was terminated in December 2013 by the Commission. The dispute with the 
former  contractor  has  not  been  resolved.  However,  in  2016,  an  engineering  firm 
contracted  by  the  Commission  carried  out  a  thorough  study  on  the  necessary 
remedial  works,  their  cost  and  the  relevant  tender  dossier.  This  study  is  being 
finalised.  

At the end of the year, 252 contracts were overall running under the Programme.  

As  regards  the  Commission's  administration,  the  tasks  and  resources  of  the  former 
Task  Force  for  the  Turkish  Cypriot  community  were  transferred  to  the  Secretariat 
General's  Structural  Reform  Support  Service  (SRSS)  in  2016.  The  SRSS  is  tasked 
with the coordination of the work of all Commission services involved in supporting 
the Cyprus settlement process under UN auspices. Together with the team supporting 
President Juncker's Personal Representative, it formed a new unit "Cyprus Settlement 
Support". This transfer did not change the mandate given to the Commission under 
the Aid Regulation.  

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4.2. 

Progress by objectives 

The  overall  objective  of  the  Aid  Programme  is  to  facilitate  the  reunification  of 
Cyprus  by  encouraging  the  economic  development  of  the  TCc,  with  particular 
emphasis on the economic integration of the island, on improving contacts between 
the  two  communities  and  with  the  EU,  and  on  preparation  for  the  acquis.  The 
activities  undertaken  in  2016  with  respect  to  each  of  the  objectives  of  the  Aid 
Regulation were:  

4.2.1.  Objective 1: Developing and restructuring of infrastructure 

The  part  of  the  Next  Generation  Network  telecommunications  equipment  for 
delivering  data  (internet)  services,  already  provisionally  accepted  was  running 
without  major  incidents.  However,  the  billing  module  required  for  delivering  voice 
services has not yet been completed. Discussions took place with the supplier on how 
and  when  final  tests  could  be  executed  for  the  delivery  of  a  full  Provisional 
Acceptance Certificate in 2017. 

Technical  assistance  on  traffic  safety  continued  in  order  to  accompany  the 
beneficiary  in  the  reforms  in  the  sector.  Following  a  comprehensive  assessment  of 
the situation, focus was put on amending the vehicle registration process as the first 
step in setting up a vehicle inspection system aligned to international standards.   

The  bi-communal  Nicosia  Wastewater  Treatment  Plant 
(WWTP)  at  Mia 
Milia/Haspolat has been producing clean effluent since 2012, but a number of related 
projects still have to be carried out. The design of the new trunk sewer serving the 
whole  of  Nicosia  and  connecting  to  the  bi-communal  WWTP  made  good  progress 
and the preparation of the Works tender to construct the sewer was initiated. The two 
communities  reached  an  agreement  on  sharing  the  treated  WWTP  effluent;  a 
feasibility  study  for  and  design  of  the  distribution  system  up  to  the  buffer  zone  is 
underway,  along  with  assistance  for  promoting  agricultural  use  of  the  stabilised 
sewage sludge produced by the plant.  

In 2016, an engineering firm carried out the study to identify the necessary remedial 
works  for  the  Famagusta  sewage  networks  and  related  cost.  This  study  is  being 
finalised. 

Assistance  in  the  solid-waste  sector  continued  through  different  actions.  The 
installation  of  a  new  sterilisation  facility  for  treatment  of  hazardous  medical  waste 
was  delayed  as  the  beneficiary's  premises  were  not  ready  to  accommodate  the  new 
equipment. This was eventually resolved and project implementation had resumed by 
year  end.  Also,  a  tender  dossier  was  prepared  for  the  extension  to 
the 
Koutsoventsis/Güngör landfill, including specifications for a leachate-treatment unit. 
Four  waste  transportation  trucks,  reinforcing  the  fleet  available  to  the  local 
communities  to  transport  waste  to  the  central  landfill,  were  delivered.  However, 
additional  investment  in  waste  trucks,  as  well  as  in  other  waste-management 
infrastructure  (transfer  stations,  closure  of  illegal  dumpsites),  needs  further 
preparation  on  the  side  of  the  beneficiary.  A  project  for  setting  up  a  collection, 
transport  and  central-treatment  system  for  animal  by-products,  which  are  most 
dangerous  for  human  health,  was  prepared  and  tendered.  Finally,  solid  waste 
management was also addressed in grant schemes supporting civil society and local 
communities. 

The beneficiary informed the Commission that it wished to take over the finalisation 
of the construction of information and management centres in four potential Natura 

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2000  areas  using  its  own  budget.  Those  partially  constructed  buildings  were  the 
subject  of  a  contract  that  terminated  in  2011  and  were  to  be  completed  under  a 
Delegation Agreement with the UNDP signed in 2014.  

4.2.2.  Objective 2: Promoting social and economic development 

The  Technical  Assistance  to  the  Private  Sector  (TAPS)  project,  launched  in 
November 2015, continued. This project aims at promoting private sector growth and 
job  creation.  It  provides  technical  assistance  to  local  bodies  to  prepare  for  the 
application of the acquis in areas linked with the development of the private sector. 
The  support  takes  the  form  of  analytical  studies  and  preparation  of  strategies, 
including,  for  example,  the  finalisation  of  the  Small-and-Medium  Enterprises 
Strategy  and  Action  Plan.  It  also  assists  Micro  and  Small-Sized  Enterprises 
(MSMEs)  to  prepare  for  the  acquis  by  supporting  Business  Support  Organisations, 
which reinforce the organisational and service provision capacity of the former. 

In September 2016, a single contract was signed with an external expert: to assess the 
viability  of  an  innovation  strategy  in  line  with  Horizon  2020  and  the  concept  of 
SMART  growth;  and  to  investigate  possible  patterns  of  integration  with  the 
government controlled areas.   

In addition, in February 2016, a Delegation Agreement was signed with the EBRD to 
grant  Turkish  Cypriot  companies  access  to  credit  funds  and  to  provide  capacity- 
building support to local business consultants. Businesses are also supported directly 
through  grants.  Twenty-four  projects  funded  under  the  SME  Development: 
Modernising  Products  and  Services  grant  scheme  were  still  ongoing  at  the  end  of 
2016.  

In  the  field  of  rural  development,  technical  assistance  was  launched  to  develop  the 
capacity of farm-advisory services, including the preparation of a strategy. Out of the 
39 projects awarded in 2013 under the 3rd Rural Development grant scheme, a further 
13 were successfully completed in 2016. 

Technical  assistance  to  strengthen  the  capacity  of  veterinary  services  to  secure  and 
monitor compliance with animal health standards and other sanitary requirements for 
control of animal diseases and future trade of animal products, which started in mid-
2015, continued in 2016. This remains a particularly challenging assignment.  

A  metrology  project  was  launched  to  develop  analytical  services  in  the  Turkish 
Cypriot community to the level where they can be relied upon to support analysis of 
foodstuffs and products in a manner compliant with EU acquis requirements in key 
areas.  

The  4th  call  for  proposals  for  Community  Development  was  published  on  8  April 
2016  with  an  allocated  budget  of  EUR  4.85  million.  This  new  grant  scheme  offers 
the local communities the opportunity to submit proposals to improve the efficiency 
and quality of services. The main priorities are waste management services, cleaning 
and  environmental  services,  social  services  targeting  the  elderly,  women,  children 
and  youth,  stray  animals,  management  services,  pest-control  services  and  capacity 
building  and  the  strengthening  of  management  structures.  Evaluations  of  the 
proposals received are ongoing. 

In the education sector, 15 grants were awarded in 2016 under the EUR 1.5 million 
scheme  for  Innovation  and  Change  in  Education  VI.  Their  objectives  include 

5 

 
 
enhancing  teaching/learning  capacities,  joint  projects  with  Greek  Cypriot  schools, 
and  improving  the  capacities  for  entrepreneurship  and  lifelong-learning.  Out  of  the 
15  projects,  9  are  being  implemented  by  schools  and  6  by  lifelong-learning 
organisations. 

A new EUR 1.5 million grant scheme for Innovation and Change in Education VII 
was launched in the first half of 2016, covering the same objectives as the previous 
call for proposals. The evaluation of proposals is also ongoing.  

In  2016, the second technical assistance  project for  Vocational Education, Training 
and  Labour  Market  (VETLAM  II)  focused  in  particular  on  a  review  and  update  of 
the qualifications framework and on capacity building for employment services. The 
project is planned to end in November 2018. 

Building  on  the  results  of  previous  analytical  work,  the  second  phase  of  the 
economic monitoring programme conducted by the World Bank provided additional 
in-depth  analysis  and  technical  assistance  in  important  areas.  The  programme 
focused  on  fiscal  analysis,  financially-sustainable  public  administration  bodies, 
economic,  trade-related  effects  of  reunification,  private-sector  development  and 
social  inclusion  and  macroeconomic  monitoring.  This  programme  is  planned  for 
completion in the second half of 2017.  

4.2.3.  Objective 3: Fostering reconciliation, confidence building measures, and support to 

civil society 

The  Committee  on  Missing  Persons  (CMP),  supported  by  the  Aid  Programme 
through  an  indirect  management  arrangement  with  UNDP,  continued  its  field  and 
laboratory work. By the end of 2016, out of the 2001 total missing persons, the CMP 
had  exhumed  1192  sets  of  remains,  out  of  which  740  were  genetically  identified. 
After  a  slow  down  of  identifications  during  2015  due  to  an  audit  of  DNA  testing 
procedures,  the  rate  increased  in  2016  to  the  high  numbers  recorded  in  2013  and 
2014. Additional positions for investigators were opened and an archive project was 
established  in  July.  In  February  2016,  religious  leaders  made  a  joint  appeal  for 
Cypriots  to  come  forward  with  information.  A  book  on  the  work  of  the  CMP 
scientists  was  produced  in  three  languages.  It  was  presented  in  Cyprus  and  during 
events at the United Nations in New York, the International Red Cross Committee in 
Geneva  and  the  European  Parliament  in  Brussels,  where  Presidents  Schultz  and 
Juncker  renewed  their  full  support  for  this  project,  which  is  instrumental  for 
reconciliation in Cyprus. In December 2016, the Delegation Agreement with UNDP 
was extended to provide funding for the operations of the CMP also for 2017, for an 
amount of EUR 2.6 million. Further EU support to the CMP operations will be based 
on  its  updated  strategy  for  2018-2020.  Overall,  in  the  period  2006-2016,  the  EU 
contributed  in  excess  of  80%  of  the  overall  funding  provided  to  the  CMP  by  all 
donors.  

Cultural  Heritage  protection  through  the  bi-communal  Technical  Committee  on 
Cultural  Heritage  (TCCH)  remained  a  key  component  of  the  reconciliation  and 
confidence  building  actions  supported  under the  Aid  Programme.  During  2016,  the 
main  milestones  of  the  programme  included  the  start  of  conservation  measures  for 
the Martinengo Bastion and the Venetian walls between the Arsenal and the Othello 
Tower/Citadel  in  Famagusta.  Also  in  2016,  works  started  for  the  conservation  of 
Agia  Marina/Gurpinar,  a  Maronite  church  located  within  a  military  site  that  was 
finally  made  accessible  in  2016.  The  first  phase  of  the  conservation  of  Agios 
Panteleimonas in Myrtou/Çamlıbel village was finalized during 2016. 

6 

 
 
A  Delegation  Agreement  for  the  fifth  phase  of  the  Cultural  Heritage  protection 
programme  was  signed  with  UNDP  in  December  2016.  In  the  future,  particular 
attention will continue to be given to conservation and caretaking of restored sites by 
the beneficiary communities.   

In  response  to  an  initiative  of  the  two  Cypriot  leaders  for  new  confidence  building 
measures, the Commission acted swiftly in 2015 to reallocate the necessary resources 
for  the  opening  of  the  new  crossing  points  at  Deryneia  and  Lefka-Apliki.  A 
Delegation Agreement with UNDP was signed in early 2016 for works north of the 
Green Line, which are expected to be completed in the first half of 2017. 

Support  for  civil  society  continued  in  2016.  Technical  assistance  (Civic  Space)  - 
providing capacity building for Civil Society Organisations (CSOs) and stimulating 
networking and joint actions with Greek Cypriot and other EU CSOs - continued in 
2016.  Efforts  concentrated  initially  on  creating  an  enabling  environment  for  the 
development of Civil Society and encouraging active citizenship initiatives through 
the  "Grow  Civic"  mechanism.  In  addition,  the  eighteen  grants  awarded  under  the 
"Civil Society in Action IV and V" grant schemes were still running in 2016. They 
funded  a  variety  of  actions  in  the  fields  of  the  environment,  human  rights,  art  and 
sport,  which  encourage  citizens'  engagement  and  cross-community  exchanges  in 
those fields.  

The  Civil  Society  Forum  (CSF),  a  platform  where  CSOs  can  express  their 
expectations and priorities, was convened every three months. It acted as a catalyst 
for advocacy and promoted active citizenship. A full month of CSO actions under the 
name of "Open Door Festival" took place for the first time from mid-September to 
mid-October;, the aim of these actions was to inform the public of past and present 
activities  and  promote  volunteerism  among  people  of  all  ages.  During  the  Festival, 
more  than  40  associations,  foundations,  platforms,  initiatives  and  activists  opened 
their  doors  and  carried  out  more  than  80  events,  including  open-door  events  and 
other community-oriented activities. 

4.2.4.  Objective 4: Bringing the TCc closer to the EU 

The management of scholarships to the EU was delegated to the British Council for 
the academic years 2014-16. This arrangement was extended for a further three years 
through a Delegation Agreement signed with the British Council in December 2016, 
covering  the  academic  years  2017-20.  The  EUR  1.92  million  available  under  the 
2016  call  allowed  151  scholarships  to  be  funded  for  the  2016/2017  academic  year. 
These  scholarships supported young students  during the first  year  of undergraduate 
studies, graduate students in their masters' and doctoral programmes, and researchers 
and  professionals  to  further  develop  their  skills  and  knowledge  across  several  EU 
Member  States.  The  Scholarship  Programme  has  ensured  access  to  scholarships  by 
more  than  1000  Turkish  Cypriot  students  and  professionals  since  2007.  The 
continuity of this scheme is considered vital. As part of the activities to manage the 
Scholarship  Programme,  the  British  Council  organised  'Study  in  Europe'  days  to 
provide information to students about study possibilities in the EU. It also continued 
to  develop  an  alumni  network  and  will  monitor  the  medium-term  impact,  for 
example  the  return  rate  of  students  to  Cyprus  and  the  success  rate  in  finding 
employment.  

There  is  a  high  demand  for  information  on  the  EU  in  the  Turkish  Cypriot 
community. The EU Infopoint, which is managed together with the Representation of 
the European Commission  in  Cyprus, started functioning in early 2015 with  a total 

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budget  of  EUR  1,545,000  for  a  30-month  period. It  generated  a  high  level  of 
visibility  for  the  EU,  its  policies  and  the  Aid  Programme.  Up  to  now,  the  EU 
Infopoint  has  held  various  panels/events  on  various  topics,  including  environment 
(water,  energy,  waste  management  including  recycling,  and  biodiversity),  organic 
agriculture, health & safety at work, food safety, animal welfare and animal health. It 
has  also  covered  topics  such  as  human  rights,  rights  of  people  with  disabilities, 
children’s  rights,  gender  equality,  LGTB  rights,  and  consumer  rights.  In  2016,  the 
EU  Infopoint  organised  47  events  (of  which  35  in  Nicosia)  including  Europe  Day, 
European Week Against Racism, European Youth Week & International Youth Day, 
European  Night  of  Researchers,  EU  Anti-Trafficking  Day,  Mobility  Week  and 
Traffic  Safety,  European  Week  of  Sport,  and  European  SMEs  Week.  These  events 
attracted  over  4,382  participants,  showing  increased  interest  from  the  community 
(2,383 participants at 2015 events).   

During  2016,  5,139  information  products  and  12  newsletters  were  distributed  (in 
total  since  the  opening  of  the  Infopoint,  11,429  and  20  respectively). 564  news 
articles  and  32  TV  spots  appeared  on  the  local  media  during  2016  (923  and  82, 
respectively, since inception of the project). Traffic on the Facebook page "Abbilgi" 
also confirmed the popularity of the activities (3,896 new 'likes' in 2016, bringing the 
total  number  of  likes  since  its  opening  to  8,471).  The  EU  Infopoint  also  supported 
the  promotion  of  all  Calls  for  Proposals  and  other  Aid-Programme-funded  projects 
and  events  via  Facebook  posts/reminders,  front-shop  poster  displays,  hosting  of 
events  and  project  launches  at  its  public  space.  It  established  strategic  partnerships 
with other EU-funded projects and technical assistance projects such as Civil Society 
development 
(Civic  Space),  Private  Sector  development,  Animal  Disease 
Eradication,  Waste  Management,  and  with  relevant  departments  and  Civil  Society 
Organisations in the TCc.   

4.2.5.  Objectives  5-6:  Preparing  the  Turkish  Cypriot  community  to  introduce  and 

implement the acquis  

The  Commission's  Technical  Assistance  and  Information  Exchange  (TAIEX) 
instrument is used to implement objectives  5 and 6 of the Aid Regulation and thus 
helps prepare the TCc for implementation of the acquis in view of the withdrawal of 
its suspension upon the entry-into-force of a comprehensive settlement of the Cyprus 
problem.  

Assistance continued in 2016 around the same 16 main areas or 'sectors' of the acquis 
as  in  previous  years.  In  total,  the  number  of  events  organised  in  2016  was  220. 
TAIEX  actions  included  expert  missions,  training  courses,  workshops  and  study 
visits. TCc stakeholders demonstrated a significantly heightened awareness of acquis 
requirements in the active TAIEX sectors.  

Support  for  trade  across  the  Green  Line  (Regulation  866/2004)  continued.  The 
independent experts were involved in 2016 in carrying out the regular phytosanitary 
inspections  of  potatoes  and  citrus  products,  taking  honey  samples  for  analysis  and 
producing  an  updated  list  of  vessels  whose  catch  can  be  traded  across  the  Green 
Line. 

4.3. 

Financial execution (contracts and payments) 

4.3.1.  Contracting 

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Legal  commitments  amounted  to  EUR  15.5  million  in  2016.  The  total  volume 
decreased compared to the previous year, although the total number of transactions 
increased.  

4.3.2.  Payments 

Payments in 2016 were EUR 21.4 million.  

4.4.  Monitoring 

The Commission has direct responsibility for implementation of most projects (direct 
management).  The  level  of  monitoring  by  Commission  staff  is  very  high,  with 
constant  contacts  with  contractors,  "spot-check"  visits,  site  meetings  and  steering 
committees  meetings.  The  PMU  continued  to  support  the  Commission  with  the 
monitoring implementation of grant contracts/projects awarded to local communities 
for their development, to SMEs and rural enterprises, to Civil Society Organizations, 
and  to  schools  and  vocational  education  and  training  organisations,  while  also 
supporting  grant  beneficiaries  in  the  application  of  EU  rules  for  grant  contract 
implementation, including for secondary procurement.  

The  TAIEX  monitoring  was  conducted  through  Project  Steering  Groups,  aimed  at 
stock-taking, progress evaluation and planning for the future period. TAIEX logistics 
are monitored through the on-line TAIEX Management System. 

4.5. 

Audit and controls 

The European Court of Auditors reported in early 2016 on the follow-up to the 2012 
TCc Aid Programme audit. According to its findings, no follow-up action is required. 
Also,  a  detailed  external  audit  of  internal  control  mechanisms  was  carried  out  in 
order to identify potential improvements in assurance following the 2015 transfer of 
the  Task  Force  to  the  Directorate-General  for  Regional  and  Urban  Policy.  The 
auditors reported in 2016 and their findings were streamlined into the integration of 
the former Task Force into the Structural Support Reform Service. In autumn 2016, 
DG NEAR conducted an ex-post audit on selected payment transactions and related 
procurements  and  contracting  procedures  under  direct  management,  reporting  that 
they  were  free  from  material  errors.  A  contract  was  signed  for  the  expenditure 
verification  of  15  grant  contracts  awarded  under  the  grants  scheme  for  SME 
development III: modernising products and services. This work will continue during 
2017.  

4.6. 

Evaluation 

A  significant  improvement  in  statistics  within  the  TCc  will  be  necessary  to 
accompany the future acquis roll-out.  

Following  the  2014  assessment  of  CMP  operations  by  the  Equipo  Argentino  de 
Antropologia Forense (EAAF), more visits were made by  the EEAF in 2016; these 
were devoted to field operations and training of scientists. An ex-post evaluation of 
SME  grant  schemes  was  contracted  to  the  PMU  and  was  scheduled  to  start  at  the 
beginning of January 2017.  

4.7. 

Information, Publicity and Visibility 

Overall, there were 138 visibility and communication actions in 2016. The highlights 
in  2016  were:  rural  tours  to  4  different  locations  outside  of  Nicosia,  sharing 
information with women’s groups about EU rural development policies and available 
EU  support  and  opportunities,  a  public  information  event  for  the  Technical 

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Committee  on  Cultural  Heritage;  skills-development  sessions  for  youth  in  several 
locations  to  boost  the  job-searching  skills  of  unemployed  young  people  and  to 
promote  local  and  EU  employment/volunteering  portals;  the  European  Science  and 
Fun Day, in which 600 high-school students participated. Europe Day was celebrated 
with a large-scale outdoor event with more than 450 participants. Green Week was 
celebrated with a series of events including a panel, film-screening, an outdoor event 
for an awareness campaign, and a battery collection  competition, which resulted in 
the  collection  of  more  than  2,000  kg  of  used  batteries  from  41  schools.  A  Traffic 
Safety  Short  Video  Competition  was  also  organised  to  raise  safety  awareness 
amongst young people.   

4.8. 

Consultations with the Government of the Republic of Cyprus 

Meetings  were  held  with  representatives  of  the  Government  of  the  Republic  of 
Cyprus,  in  particular  when  senior  Commission  officials  visited  the  island.  The 
Commission  continues  to  rely  on  the  Government's  cooperation  for  verification  of 
property  rights,  and  also  meets  regularly  with  the  Permanent  Representation  in 
Brussels.  In  March  2016,  the  Commission  made  a  general  presentation  of  the 
previous  year's  developments  under  the  Aid  Programme,  hosted  by  the  Ministry  of 
Foreign Affairs, an annual occurrence. 

5. 

CONCLUSIONS 

The Commission remains committed to supporting the settlement process under the 
UN  auspices,  and  it  will  make  use  of  all  possibilities  under  the  programme  to 
facilitate initiatives arising from the process.    

The  Commission  continues  to  deliver  assistance  under  the  Aid  Regulation  to 
facilitate  the  reunification  of  Cyprus  by  encouraging  the  economic  development  of 
the  Turkish  Cypriot  community,  through  work  under  its  six  objectives.  It  has  been 
shown that TAIEX support and project support under Objectives 1 and 2 of the Aid 
Programme (infrastructure investments and supplies, technical assistance grants) had 
a  positive  impact  on  the  work  of  the  bi-communal  Ad-Hoc  Committee  on  EU 
preparations,  which  operates  under  UN  auspices,  since  TCc  participants 
demonstrated  a  significantly  improved  awareness  of  the  acquis.  During  2016, 
assistance  continued  to  focus  on  areas  that  present  particular  problems  with  future 
acquis compliance.  

In view of the capacity constraints, limited human and financial resources and gaps 
in  readiness  for  the  future  acquis  roll-out,  the  sustainability  of  projects  must  be 
carefully considered. The Commission has remained active in supporting particularly 
complex  projects  for  periods  after 
to  beneficiaries.  Major 
infrastructure  projects  are,  however,  now  operating  and  maintained  successfully  by 
the beneficiaries. The track record of past assistance and the maturity of projects will 
be reflected in future programming exercises. 

the  hand-over 

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