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Grant Contract

This training program provides guidance on project management and implementation for grant beneficiaries and partners, focusing on the structure and obligations of grant contracts. The training is organized by Tatiana Udrea, EaPTC MA, GIZ in Chisinau, Republic of Moldova in 2017.

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Grant Contract

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  1. Grant Contract Training on Project Management and Implementation for Grant Beneficiaries and Partners TC Programme MD-UA Tatiana Udrea, EaPTC MA, GIZ Chisinau, Republic of Moldova 2017

  2. Congratulations ! You are the winner!

  3. Grant Contract: structure and obligations

  4. Yourcontractoutline (1) Special conditions Article 1 – Purpose Article 2 - Implementation period of the Action Article 3 - Financing the Action Article 4 - Reporting and payment arrangements Article 5 - Contact addresses Article 6 – Annexes Article 7 - Other specific conditions applying to the Action

  5. Yourcontractoutline (2) • Annexes: • Annex I: Grant Application Form (Description of the Action) • Annex II: General Conditions applicable to European Community-financed grant contracts for external Actions • Annex III: Budget for the Action • Annex IV:Contract-award procedures • Annex V: Standard request for payment and financial identification form …

  6. Yourcontractoutline (3) … • Annex VI: Model narrative and financial report • Annex VII: Model report of factual findings and terms of reference for an expenditure verification of an EC financed grant contract for external actions • Annex VIII: Legal Identity Form • Annex IX: Standard template for Transfer of Asset Ownership • Annex X: Partnership Agreement Note: Annexes are part of the grant contract.

  7. Whatcomes first? • The provisions of the Special Conditions take precedence over ALL the Annexes • Annex II (General Conditions applicable to European Union -financed grant contracts for external Actions) takes precedence over the other annexes IMPORTANT! Read first those 2 documents carefully!

  8. Beneficiary (the Lead Partner) Managing Authority (GIZ) PURPOSE OF THE CONTRACT: The legal framework for implementing the project and receiving non-reimbursable financing. CONTRACT PARTIES:

  9. Start of implementation (1) Distinguish between: When the Contract takes effect = date of last signature When the Action starts = day following that on which the last of the two Parties signs(art. 2.2 of the special conditions)

  10. Start of implementation (2) • IMPORTANT ! Costs are eligibleonlyafter Action start date! • Procedures to award sub-contracts for goods or services may be initiated before but sub-contracts may NOT be concluded by the Beneficiary or its partners before Action start date

  11. Implementation period Distinguish between: • When the implementation periodends: XX months after Action start date (art. 2.3 Special conditions) • When the execution period of the contract ends: • When final payment is paid by MA OR • In any case at the latest 18 months after the end of implementation period IMPORTANT! Costs are eligible only during implementation period. Except costs relating to final reports, expenditure verification and evaluation of the Action

  12. Implementationperiod: extension? IMPORTANT! Beneficiary may request an extension of the Action's implementation period (General Conditions art. 11.1) • In exceptional and justified cases • No later than two months before it ends • Request must be accompanied by all the supporting evidence needed for its appraisal. Final decision on such requests is a subject of approval by the Managing Authority

  13. Financing the Action • Budget includes all eligible project costs, not just the ENPI CBC programme contribution • Double ceiling for MA financing (art. 3.2 Special Conditions), examples:

  14. Reporting on the Action • Progress report (narrative section) conforming to the model in Annex VI must: Be submitted no later than 1 month after the end of each six month reporting period (even in the absence of request for payment) • Interim report (consisting of both narrative and financial section) conforming to the model in Annex VI must Accompany every request for payment • Final report shall be forwarded no later than 2 months after the implementation period ends

  15. Modifying the Action? • When changes to the grant contract are necessary? • If the circumstances affecting project implementation have changed since the initial contract was signed. • Keep in mind that a change to the grant contract is allowed only IF: • The execution period of the contract is still running • The change is set out in writing (addendum / notification) • The request is well reasoned and justified to the management structures • The request is submitted before the date on which the amendment • should enter into force • The request is approved by / notified to the MA

  16. Keep in mind that a change to the grant contract is allowed only IF: • The request does not call into question the grant award decision or is not contrary to the equal treatment of applicants • Does not have retroactive effect • Does not affect the functionality and economic viability of the project • All the project partners have given their written consent • The maximum amount of the grant is not increased • The percentages of financing is kept (in case of the budget reduction) • If extension of the period of implementation is necessary, the request must be submitted no later then 45 days before the date the grant contract ends

  17. MEANS OF CHANGING THE GRANT CONTRACT • When to use it? • To change the auditor, bank accounts, social address • To transfer amounts between items within the same main budget heading • To transfer amounts between main budget headings or partners’ budget of 25% or less of the original amount • When to use it? • To extend the implementation period • To transfer amounts between main budget headings or partners’ budget of more then 25% of the original amount • To transfer amounts from heading - Provision for contingency reserve or heading - Administrative costs • Any other changes to the Description of then action which are necessary and properly justified

  18. Responsibilities of the contract parties – THE BENEFICIARY (1) General responsibilities Carries out the Action under its own responsibility. Is the only one responsible towards the MA for the operational and financial progress of activities. Answers all written requests from the MA/TS within the deadline set. Takes all necessary precautions to avoid conflicts of interests. Publicizes the Action according to the Manual of Visual Identity.

  19. Responsibilities of the contract parties – THE BENEFICIARY Payments Receives pre-financing(s) from MA in order to implement the Action. Transfers shares of the grant to its partners, according to the contract. Appoints the audit firm(s) and notifies the MA Ensures its expenditures are verified by auditors Procurements Must comply with contract-award procedures and rules of nationality and origin set out in Annex IV of the grant contract. Reporting: Submits narrative and financial reports in support of payment requests. Provides the TS/MA within the set deadlines: progress reports, final report

  20. Responsibilities of the contract parties – MANAGING AUTHORITY Pays the grant to the Beneficiary under the condition of availability of funds from the EC. Takes measures in case that award procedure or performance of the contract is vitiated by substantial errors, irregularities or by fraud by refusing to make payments, recovering amounts already paid or suspending payments. Takes measures if the Action is not implemented or is implemented poorly, partially or late by reducing the grant initially provided. Determines the total amount of eligible expenditure. Requests additional information at any time regarding the implementation of the Action. Assesses the progress of the Action through interim and final reports. Conducts inspections in order to verify the implementation of the Action.

  21. SUSPENSION OF THE CONTRACT When? Circumstances (chiefly force majeure) make the Action too difficult or dangerous to continue. SUSPENSION OF PAYMENTS When? Errors, irregularities or fraud committed by the Beneficiary or any of its partners occur. Prior to terminate the Contract (as a precautionary measure) without prior notice.

  22. Termination of the contract (1) IF: the Beneficiary is bankrupt or being wound up, is having its affairs administered by the courts or is in similar situations, fraud, corruption, substantial errors, involvement in a criminal organization or any other illegal activity are identified, grave professional misconduct of beneficiary or partners of the Beneficiary are identified, the Beneficiary fails, without justification, to fulfill any of the obligations arising from the grant contract, the Beneficiary makes false or incomplete statements to obtain the grant,

  23. Termination of the contract (2) IF: the Contract can no longer be executed effectively or appropriately, the Beneficiary provides reports that do not reflect reality, the Beneficiary has not fulfilled obligations relating to the payment of social security contributions or the payment of taxes.

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