EuropeAid EU financial & contractual Procedures (10th EDF & budget) How to implement EU funding (with others) … October 2010 – Delegation KENYA - FVDE.

EuropeAid

EU financial & contractualProcedures (10th EDF &

budget)

How to implement EU

funding (with others)…

October 2010 – Delegation KENYA - FVDE

EuropeAidLegal basis and where to find our rules

•EDF : Revised Cotonou Agreement

•Budget : DCI Regulation, EIDHR Regulation & bananas

•Financial Regulation and implementation Rules (Budget); 10th EDF Financial Regulation (Internal agreement 10th EDF & Regulation on 10th EDF implementation)

http://www.cc.cec/dgintranet/europeaid/contracts_finances/legislation/index_en.htm

EuropeAidLegal basis and where to find EU rules

•PRAG Practical Guide to contract procedures for EC external actions (December 2008) : same document for

EDF and budget

•Financial Guide (one for Budget and one for EDF)

•Practical Guide for programme estimates (version December 2009): same document for EDF and budget

•Several instruction notes

http://www.cc.cec/dgintranet/europeaid/contracts_finances/guides/index_en.htm

EuropeAidLegal basis and where to find EU rules

• 10th EDF rules apply for projects financed on 10th EDF and on 9th EDF if a jumbo rider was signed

• STABEX and 8th EDF projects still ruled by 8th EDF rules

• Projects financed on (thematic) budget lines are ruled by BUDGET rules

EuropeAid

MANAGEMENT MODES

By WHO can a project or a programme

be implemented ?

EuropeAidManagement modes

• Centralised management

• Delegated cooperation

1) indirect centralised management

2) Joint management

3) Decentralised management

4) (Shared management)

EuropeAidCentralised management

DIRECT

Implementation done by the services of the EU (at HQ or in delegation)

EU procurement & grant procedures apply (we launch tenders, sign contracts, make payments, etc...)

Examples: Somalia operations, Audit & Evaluation contracts,

framework contracts, Budget support, …

EuropeAidDelegated cooperation : centralised

indirect

There is a delegation of implementation tasks by the Commission

Implementation done (1) by bodies set up by the Communities or other specialsed Community bodies such as EIB or EIF, (2) national or international public sector bodies or bodies governed by private law with public service mission providing adequate financial guarantees and complying for with provisions IR

Procedures of the delegated body can apply or EU procedures

EuropeAidDelegated cooperation : centralised indirect

An ex-ante institutional assessment needs to be carried out of 6 pillars

A delegation agreement is signed

EuropeAidDelegated cooperation : joint management

There is a delegation of implementation tasks by EU

Implementation done by an international organisation (includes EIB) The IO concerned can apply its accounting, audit, internal

control and procurement procedures which offers guarantees equivalent to the international accepted standards

A contribution agreements is signed (similar to a grant contract

but more flexible)

EuropeAidDelegated cooperation : decentralised

There is a delegation of implementation tasks by the Commission to third countries (beneficiary countries)

Implementation done by beneficiary country with ex-ante control by the EU (partial or substantial decentralisation) or ex-post control (total decentralisation)

Other Procedures than EU can apply (case by case, after assessment)

Financing agreement to be signed

Ex-ante control could be delegated to another body


decentralisation of contractual procedures

ex-ante control by COM at every step for procurement contracts > 50,000 EUR + for grants

(payment remains centralised)

Practical GuideProgramme Estimates

Practical Guideon Contract Procedures

+ decentralisation of payments

< certain thresholds (ex-post control by COM)

Substantial or total decentralisation

(possibly only ex-post control by COM)

criteria partly fulfilled

all criteria fulfilled

+


Thresholds of contracts and grants for (partial) decentralisation of payments (Practical Guide for Programme Estimates applies)

Works Supplies Services Grants

< € 300 000 < € 150 000 < € 200 000 ≤ € 100 000

EuropeAidDelegated cooperation

NOTE

The other way around is also an option :

EU to receive funds from other donors through tranfer agreement (assigned revenues)

EuropeAidEU Implementation modalities

• Delegated cooperation with MS bodies, international organisations or benef. country (if partial decentralisation through programme estimates)

• Budget support

• Procurement contracts (services, supplies & works)

• Award of grant contracts

• Other

• Other

EuropeAidWorking with EIB ? HOW ?

If several donors

First question is who will be responsbile for managing the “common pot” (donor, beneficiary state, ...)

Type of funds (EU : non reimbursable aid (grants), other donors: very often loans), blending the two makes loan conditions cheaper

Contractual arrangements to be made, depending on who is managing common pot

Determine level of control (ex-ante or ex-post) donors want to exercise

EuropeAid

Working with EIB, if EIB manages common pot, HOW ?

Preferred option at this stage would be joint management with a contribution agreement if type of project/intervention allows or ad-hoc agreement (see

Infrastructure Trust Fund)

Under Neighbourhood Instrument as framework agreement is under negotiation to cover specialised interventions such as risk capital, loan guarantees (interest rate subsidies), ...

Under revised Financial Regulation (2012) a new more flexible implementation mechanism will be introduced for financial intermediairies

EuropeAid

QUESTIONS ?

EuropeAid

IMPLEMENTATION MODALITIES

HOW can a project or a programme

be implemented ?


• Budget support


• Grants

• Delegated cooperation with MS bodies or international organisations

• If partial decentralisation : programme estimates

• Other


• Delegated cooperation with MS bodies, international organisations or benef. country (if partial decentralisation through programme estimates)

• Budget support


• Award of grant contracts

• Other

• Other

EuropeAidImplementation procurement procedures

10th EDF/BudgetServices Supplies Works

International open tender

- >=150.000 EUR >= 5.000.000 EUR

International restricted tender

>= 200.000 EUR

- - (derogation)

Local open tender

- <150.000 EUR and >= 60.000 EUR

<5.000.000 and >=300.000 EUR

Competitive negotiated procedure

>10.000 EUR and <200.000 EUR

>10.000 EUR and <60.000 EUR

>10.000 EUR and <300.000 EUR

Framework contract

>10.000 EUR and <200.000 EUR

- -

Single tender <=10.000 EUR <=10.000 EUR <=10.000 EUR

EuropeAidImplementation : procurement

•Alternative procedure applicable to works,

supplies & services contracts = negotiated

procedure but only in well defined cases, a

prior approval is needed from authorising

officer concerned (HQ or HoD)

See note on derogations and prior approvals:

http://www.cc.cec/dgintranet/europeaid/contracts_finances/fin_and_cont_rules/other_issues/index_en.htm

EuropeAidImplementation : procurement

One important possibility to do a

negotiated procedure for

service contracts is :

“where the services are entrusted to

a public sector bodies or to non-

profit organisations or associations

ans relate to activities of an

institutional nature or designed to

provide assistance to people in the

social field”

A prior call for interest could be

considered...

EuropeAidImplementation : grants

•What is a grant ? Co-financing and non profit are requirements !

•How to award a grant ?

Open or restricted call for proposal

In well defined cases a direct award is possible, prior appoval is needed by authorising officer concerned (HQ or HoD)

See note on derogations and prior approvals:

http://www.cc.cec/dgintranet/europeaid/contracts_finances/fin_and_cont_rules/other_issues/index_en.htm


One important possibility to do a

direct award for grants is:

“Actions with specifi

characteristics that require a

particular typ of body on account

of its technical competence, its

high degree of specialisation or

its administrative powers ... “

A prior informal call for

expression could be

considered...


Special cases of grants :

- Interest rate subsidies

-Twinning / exchange activities

EuropeAidImplementation : decentralised operations

& programme estimates

Tasks (including payment and contracting up to certain ceilings) are delegated to an imprest administrator and animprest accounting officer through a programme estimate

Direct decentralised operations (department of ACP State

concerned is in charge)

Public indirect decentralised operations (public body

legally distinct from ACP State is in charge)

Private decentralised operations (private operator is in

charge & responsible) – not for budget lines !

EuropeAid

QUESTIONS ?

EuropeAidFinancing decision – (Annual) Action Plan

Country Strategy Paper & NIP(Joint Strategy Paper for Somalia)

Identification fiches

Quality Support Group (1)


Annual Action Plan(s) with indicative budget

Quality Support Group (2)

Financing Decision (after Inter-service Consultation & opinion Member States

Committee & Parliament)


Financing Agreement

signed between EU and beneficiary country (not always applicable !!)

=

Special Conditions, General Conditions (Annex 1) and Technical & Administrative Provisions (TAPs – Annex 2)

EuropeAidImportant dates to keep in mind

• Deadline to sign financing agreement (31.12.n+1)

• Contracting deadlines (date of signature + 3 years or 31.12.n+1 if no financing agreement)

• Period of execution of a financing agreement = operational implementation phase + closure phase

EuropeAidImportant dates to remember

What happens once the contracting

deadline is expired in a financing

agreement ?

EuropeAidManagement modes

What “implementation issues” to be

put in an Annual Action Plan (chapter 4)?

•Method of implementation - Management modes

• Applicable rules & procedures

• Budget (always put in contingencies !) and calendar

More details will be given in TAPs (templates !)

EuropeAidImplementation : eligibility rules

• For Budget : see applicable Regulation (DCI, EIDHR, ...)

• 10th EDF :

Individuals, legal persons, supplies and materials orginating from ACP States and 27 EU Member States

International organisationsCountry participating in a regional initiativeThird Country in case of cofinancingDerogations still possible with prior approval

For more details per instrument : see annex A2 of PRAG

http://ec.europa.eu/europeaid/work/procedures/implementation/practical_guide/index_en.htm

EuropeAid EU financial & contractual Procedures (10th EDF & budget) How to implement EU funding (with others) … October 2010 – Delegation KENYA - FVDE.

Documents

eu procedures slide

edf budget

rules edf

body slide

shared management slide

implementation rules

edf regulation

flexible slide