Fulfillment of conditions and contracting Līga Kalvāne Joint Technical Secretariat Lead Partner Seminar 15 October 2009, Siauliai

Content 2  Procedure on fulfillment of conditions  Contracting procedure  Subsidy Contract

Timeframe: Fulfillment of Conditions 3  September 2009 – JMSC decision on Projects approval with conditions  End of October 2009 – deadline for submitting clarifications to the JTS  3 weeks - final approval of Projects via written procedure  December 2009 – contracting

Procedure: Fulfillment of Conditions 4  LP sends a cover letter, an electronic version of corrected Application Form and Feasibility Study (if relevant) to the JTS via till the set deadline  JTS checks and, if necessary, requests additional information  After the confirmation from JTS, LP sends cover letter with electronic copy of Application Form and Feasibility Study attached by mail  JTS sends the Application via written procedure for the final decision by the JMSC In case if project does not fulfill conditions or it takes longer then 1,5 month, project can be rejected!

Contracting Procedure 5  Draft Subsidy Contract (SC) is sent to the LP by (model SC from the 1st Call for Proposals is available on the website  LP indicates Project start date, checks bank account and signatory in SC and sends it back to the JTS by  JTS sends 2 copies of the SC to the LP by mail  LP signs, stamps and sends back two original copies to the JTS within one month from the date when SC was sent to the LP Partnership Agreement signed between the Project Partners has to be sent to the JTS together with the Subsidy Contract!!!  One hard copy of the SC co-signed by the MA will be returned to the LP

 Legal framework (§1)  Award of subsidy (§2)  Object of use, eligibility of funds (§3)  Reporting and Payments (§4)  LP and PP liabilities (§5)  Publicity (§6)  Durability and ownership of results (§7)  Rights of termination and reduction of the subsidy (§8)  Retaining of documentation (§9)  Controls and audits (§10)  Recovery of funds (§11)  Assignment, legal succession (§12)  Changes to the SC (§13)  Concluding provisions (§14) 6 Content of the Subsidy Contract

Legal Framework (§1)  The LP should implement the Project in accordance with regulations and rules as well as the horizontal policies  In case different interpretation of legal provisions is discovered the strictest rule shall apply 7

Award of subsidy(§2)  Total eligible Project budget = ERDF co-financing + National financing  All the allocations are considered as maximum provisional amounts  The MA can suspend the payments to the LP or terminate the Subsidy Contract in case the European Commission fails to make payments to the Programme  The LP for the same activities can receive funding only once within the Programme and other EU funded programmes 8

Object of use, eligibility of funds (§3)  Costs are eligible within Project implementation period (from start date till end date except of preparation costs that are paid no earlier than on 24 September 2007 and no later than on 23 September 2009)  Costs validated by the FLC  Costs certified by the CA 9

Start date – end date of the Project 10 Project start date:  Earliest – day after JMSC decision (26 September 2009) and not later than one month after signing the SC by the LP  When first costs incurred and/or  Date indicated in the SC Project end date:  Project start date + project duration indicated in the Application Form (example, 26 September – 25 November)  Set in the SC

Reporting and payments (§4)  Only the LP can request payment of the ERDF co-financing  The CA ensures that the LP receives the ERDF co-financing as quickly as possible and in full after report is verified by the FLC and approved by the JTS  The LP ensures that received ERDF co- financing is transferred to the PPs 11

LP and PP liabilities (§5)  The LP takes the overall financial and legal responsibility for the Project and for the PP  The LP and the PP shall take liability on actions made by the third parties during the Project implementation  No sub-contracting between PPs or employees of PPs who are already employed in the Project  The LP is responsible for concluding the Partnership Agreement among the PPs and submitting it to the JTS Partnership Agreement signed between the Project Partners has to be sent to the JTS together with the Subsidy Contract!!! 12

Partnership Agreement (I) 13 Lead Partner Managing Authority Subsidy Contract Application Form Feasibility Study Project Partner Partner Declarations Partnership Agreement

Partnership Agreement (II) 14 As a minimum requirement the issues stipulated (see full list in PM, 4.4.4) should include:  PPs tasks and responsibilities  Payment procedures  Decision making  Reporting obligations and deadlines  Communication between PPs  Solving of disputes  Project changes  Ownership of the project outputs and results  Arrangements for audit trail Annex: table indicating responsibility for project activities per PPs and budget breakdown per Work Packages/ Budget Lines for each PP Model is available on the website in English

Publicity (§6)  Any output produced (publication published, event organized, equipment purchased and infrastructure, improved etc.) should have reference to the Programme  The LP must ensure that the Project outputs are made freely available to public  The MA has the right to publish information on the Project and products deriving from the Project for information and publicity purposes only 15

Durability and ownership of results (§7) The LP and the PP shall insure that the:  Project outputs and results achieved within the Project will not be changed at least for 5 years after final payment from the ERDF co-financing has been made  Changes in ownerships, titles, industrial and intellectual property rights for outputs will not be made without prior approval by the MA  All estimated revenue must be calculated and deducted from the Project’s eligible expenditure  LP should appoint the contact person after Project implementation 16

Right of termination and reduction of the subsidy (§8)  The MA is entitled to:  Terminate the SC  Withhold the payments  Reduce the subsidy  Demand repayment of the ERDF co-financing  The decision to terminate the SC or reduce the ERDF co- financing shall be made by the JMSC  In case the SC is terminated received ERDF co-financing has to be repaid to the CA 17

Retaining of documentation (§9) The LP and the PP are obliged to retain all official files, documents and data about the Project for control and audit purposes on customary data storage media in a safe and orderly manner until 31 December 2021 as a minimum:  Application Form  Subsidy Contract, Partnership Agreement  Project correspondence (financial and contractual)  Progress Reports and Partner Reports  List of declared expenditure and supporting documentationn  Proof of payment for each invoice  Public procurement documents and contracts  Proofs for delivery of services and goods: studies, brochures, newsletters, minutes of meetings, signed participant lists, travel tickets, etc.  Record of assets, physical availability of equipment purchased in the context of the project 18

Controls and Audits (§10)  Controls and audits are carried out by the FLC, AA, JTS, MA, EU and MS institutions  The LP and the PP provides all the supporting documents, necessary information and access to the Project accounting system, work premises and the Project outputs for control and audit purpose  The CA has a right to withhold payments to the LP until required information have been delivered or case has been solved 19

Recovery of Funds (§11)  Irregular expenditures can be detected by any authority involved in the management and administration of the Programme  Irregular expenditures can be deducted from the requested payment or demanded as reimbursement 20

Assignment of Rights, Legal Succession (§12)  The MA is entitled to assign its rights under the Subsidy Contract immediately informing the LP  The LP is allowed to assign its duties and rights under the Subsidy Contract only prior written consent of the MA 21

Changes in the SC (§13)  The LP can request changes in the SC or its Annexes  General rule – reallocation of budget can be requested only once during Project implementation  The changes are requested to the JTS  JTS will inform the LP on decision made 22