1. European Territorial Co-operation Eligibility of expenditure for co-operation programmes Art. 17(1) ETC Regulation 16th meeting of the Expert Group on Delegated and Implementing Acts for the ESI funds 27 September 2013

2. Narrative section on eligibility in previous version of fiche No 11 replaced with closer legal text, the rest has not changed.

3. 5 categories covered: Staff costs Office and administrative expenditure Travel and accommodation costs External expertise and service costs Equipment expenditure Programmes (MS) may establish that provisions for one or more categories do not apply to one of more priority axes, including the TA Where provisions apply to one or more priority axes, programmes are not allowed to apply only parts of these provisions or to establish less stricter rules on the specific items under each expenditure category. Section 1: Subject matter and scope

4. Any expenditure can either be reimbursed on the basis of: eligible costs actually incurred and paid (together with in kind contributions and depreciations) simplified costs options under article 57(1)(b) to (d) Any expenditure to be governed by the principle of effective and economic financial management. No expenditure may be covered under more than one expenditure category or under more than one specific item under a given expenditure category. Section 2: General provisions

5. Staff costs relate to the cost of activities that the relevant beneficiary/body would not carry out if the operation concerned was not undertaken. Staff costs are in line with salaries, wages, other costs linked to the salary payments, incurred and paid by employer, provided: They are in accordance with legislation /standard practices in the country/organisation on equal treatment of all personnel They are fixed in the employment/work contract They are not recovered by the employer Staff costs are reimbursed either on real costs basis or reimbursed under simplified cost options and should be proportionate to role /responsibilities of an individual staff member. Section 3: Staff costs

6. As regards staff costs reimbursed on the basis of hours actually worked on an operation, a time registration system should be put in place. Hourly rate = Total annual staff costs of a given employee (total gross remuneration & social charges) Number of total hours worked Annual staff costs= Based on the latest documented annual gross employment costs available. (Adjustments can be done once the actual total annual staff costs is known with regard to the year during which work on the operation was done) Eligible costs of remuneration= (Hourly rate) x (number of total hours actually worked on the operation) Section 3: Staff costs

7. Costs linked to the administration and implementation of an operation. Costs are either direct or indirect. Costs can either be reimbursed on real costs basis or reimbursed on a flat rate basis according to Art. 58(1) CPR Section 4: Office & administrative expenditure

8. Travel and accommodation costs must refer to staff of the beneficiary and must be directly related and essential for the operation. Travel and accommodation costs shall be reimbursed on real cost basis except for daily allowances. If travel and accommodation costs based on a daily allowance, no real cost basis possible. Costs for travel and accommodation outside the Union part of the programmes to be reimbursed in accordance with Art. 19 (1) and (2) ETC Reg. Section 5: Travel and accommodation costs

9. List of External expertise and service costs is exhaustive. Following costs are not eligible: Fines, financial penalties and expenditure on legal disputes and litigation Gifts Section 6: External expertise & services costs

10. Expenditure for the financing of equipment and investment costs purchased or rented by the beneficiary on operations. Full purchase price of equipment is eligible if the item is used for the operation during its total economic and depreciable lifetime. In accordance with Art. 59(2) CPR, depreciation is eligible only on a pro rata basis if: Equipment purchased before approval of operation but used solely for the operation purpose (pro rata regards duration); Equipment purchased before approval of operation but used only partially on the operation during the operation lifetime (pro rata regards amount and duration); Equipment purchased after the start of the operation but used only partially on the operation during the operation lifetime (pro rata regards amount). Durable equipment that is specifically purchased or produced for operations may be considered eligible if it is without economic value or is scrapped after use. Section 7: Equipment & investment expenditure