Legal framework of the project implementation
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1 CENTRAL EUROPE PROGRAMME Project financial management and controls Vienna, 7 April 2011 Legal framework of the project implementation Luca FERRARESE JTS CENTRAL EUROPE Programme
2 1. Applicable rules The legal framework EU rules Regulations of the Structural Funds Horizontal rules Subsidy contract National rules Programme rules National legislation Internal/institutional rules Programme documents Partnership agreement
3 1. Applicable rules EU and national rules EU Regulations ruling the general budget of the EU Communities; EU Regulations ruling ERDF funds; Community rules on horizontal policies (Public procurement, equality between men and women and non-discrimination, environment protection, State Aid, Publicity); National Rules applicable to Lead and Project Partners (e.g. national eligibility rules for the Structural Funds, public procurement, etc.). In their latest version!
4 1. Applicable rules Programme documents: CENTRAL EUROPE Operational Programme; Application Manual (call specific); Implementation Manual; Control & Audit Guidelines. Additional documents are available (fact-sheets, templates, FAQ, etc.) but they are for information purposes only and they have no legal value.
5 2. Subsidy Contract and Partnership Agreement Subsidy Contract: Partnership Agreement: Signed between the Managing Authority and the Lead Partner (LP) on behalf of the entire partnership (Lead Partner principle) Signed between the LP and all Project Partners (PPs), ensuring mutual responsibilities and obligations within the partnership Standard templates on
6 2. Subsidy Contract Terms of the Subsidy Contract 1 Legal framework 2 Subject of the contract (max amount of ERDF awarded, total project budget, grant rate); 3 Project duration; 4 Eligibility of costs, budget flexibility (10% and 20%);
7 2. Subsidy Contract Terms of the Subsidy Contract 5 Request for payments: Reporting period Expected payment request * ( ) Progress/final report to be submitted to the JTS at the latest by Total cost ( ) Preparation Costs 6.000, ,80 01/07/ /10-04/ , ,47 01/07/ /11-10/ , ,94 01/01/ /11-04/ , ,51 01/07/ /12-10/ , ,03 01/01/ /12-04/ , ,07 01/07/ /13-10/ , ,68 01/02/2014 Total: , ,50 Payments not requested in time and in full or non in compliance may be lost. No advance payments foreseen!
8 2. Subsidy Contract Terms of the Subsidy Contract 6-7 Obligations of the Lead Partner: Arrangements for its relations with the other PPs (partnership agreement); Project implementation; Overall responsibility on incurred and validated expenditure; Transfer of ERDF contribution to the PPs; Project management: start-up, budget reduction, change of partner, organization of project Steering Committees; Keeping of supporting documents required for an adequate audit trail regarding expenditure incurred and payments, made available for verifications and audit; Additional obligations (e.g. State Aid conditions if applicable).
9 2. Subsidy Contract Terms of the Subsidy Contract 8 Lead Partner liability towards the Managing Authority: Overall financial and legal responsibility on behalf of the partnership and towards third parties. 9 Validation of expenditure and audit of projects: Identification of First Level Controllers for validation of expenditure; Submission of Progress Reports accompanied by validated expenditure at lead and project partner level; Retention of all information and supporting documents, at least until 31 December 2022.
10 2. Subsidy Contract Terms of the Subsidy Contract 10 Recovery of unjustified expenditure in case of irregularities and of infringements of the contract; 11 Publicity: Lack of respect of publicity rules (as in the Implementation Manual and Control & Audit Guidelines) 12 Ownership -Use of outputs: Ownership, title and industrial and intellectual property rights vest in the LP and/or PPs in accordance to the applicable national law; Joint output management must be ruled within the Partnership Agreement; Outputs cannot be transferred according to the terms as in Art. 57 of Regulation (EC) 1083/2006.
11 2. Subsidy Contract Terms of the Subsidy Contract 13 Revenues: Generated earnings (e.g. sales of products, merchandise, participation fees, training sessions offered at market price and other provision of services) will imply a deduction of the ERDF contribution in full or pro-rata (if entirely or partly generated by the project); For revenues generated after the project closure, the estimated net revenue must be deducted from the final request for payment; Until three years after the Programme closure, revenues previously not taken into account will have to be refunded.
12 2. Subsidy Contract Terms of the Subsidy Contract 14 Assignment, legal succession 15 Termination and repayment 16 Force majeure 17 Litigation Subsidy Contract annexes 1. Latest Application Form 2. EU regulations 3. Programme documents
13 2. Subsidy Contract The process 1. Communication to the Monitoring Committee on the finalization of the negotiation process (after the fulfillment of conditions). 2. Subsidy Contract offer (2 months duration) sent to the LP by the MA via the JTS. 3. Signature of the Subsidy Contract by the LP. 4. Signature of the Subsidy Contract by the MA.
14 2. Partnership Agreement Content of the Partnership Agreement It rules the obligations of LP and PPs focusing on (among others): Budget flexibility within the partnership; Structure of the Steering Committee; Separate accounting system for project management; Internal procedure of reporting and ERDF reimbursement; Identification of First Level Controllers by each PP; Location of documents for each PP (storage and audit trail); Changes in the project (partnership, budget, activities, duration); Budget managed by EU Partners outside CE (20% flexibility); Activities implemented outside EU territory (10% flexibility); Other obligations (e.g. State Aid if applicable).
15 2. Partnership Agreement Correspondence between SC and PA Subsidy Contract 1 Legal Framework Preamble Partnership Agreement 3-9 Contract Duration 3 Duration of the Agreement 6-7 Obligations of the LP 5-6 Obligations of the LP and PP 9 Validation of expenditure and audit of projects 8 budgetary and financial management, accounting principle.. Content of the Programme template must be considered as the minimum possible to be included in the Partnership Agreement.
16 2. Partnership Agreement Partnership Agreement annexes 1. Latest Application Form 2. Subsidy Contract 3. Detailed work plan and timetable of activities per project partner; 4. Partners budget split per work package, budget line and reporting period (template available on the Programme web site).
17 2. Partnership Agreement The process 1. PA signature can be: One document signed by the entire partnership; Bilateral agreements signed by the LP and each PP; 2. The signed PA is not to be sent to the MA/JTS, but evidence of its signature by LP and all PPs must be provided; 3. The PA must be always updated in case of change of partner, activities and budget revision. Lack of evidence of the signed PA will not allow the ERDF reimbursement; The MA/JTS will check the content and proper signature of the PA on a sample basis (within on-the-spot checks).
18 3. Next steps Projects to-dos Projects to be started at the latest within 2 months after the signature of the Subsidy Contract; Installation of separate accounting systems by the LP and PPs; Identification of LP and PPs First Level Controllers in accordance with national systems; Preparation of the PA according to the specific needs, using the Programme template as minimum requirement; Submission of the Start-Up Report to the JTS at the latest 3 months after the contract signature, including evidence of the PA signature by all PPs; Invite the JTS to your project Steering Committee meetings.
19 CENTRAL EUROPE PROGRAMME THANK YOU!
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