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Initial eligibility assessment and ex-post monitoring of State aid in EU funds co-financed projects. Content Initial eligibility assessment Assessment of aid objectives Assessment stages Preparation stage Project appraisal 2. Ex-post monitoring Monitoring of project implementation
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Initial eligibility assessment and ex-post monitoring of State aid in EU funds co-financed projects
Content • Initialeligibilityassessment • Assessment of aid objectives • Assessment stages • Preparation stage • Project appraisal 2. Ex-postmonitoring • Monitoring of project implementation 3. Payment of costs
Goals of project appraisal • Reduce market distortions to minimum • Prevent fraud in EU funded projects • Prevent inappropriate or disproportionally large support to beneficiary
Payment of costs • Payment is made to the beneficiary only after a full 3-step check-up that includes: • Appraisal and approval of the project application; • Verification that the actual expenditure has been made in compliance with the program provisions (i.e.,as per contract); • Verification that the objectives of the program (e.g. commencement of economic activity based on the purchased equipment) have been reached.
Preparation stage for receipt of projects • Preparing for project selection • Launch of informative campaign on the program provisions: • publication in local newspapers on the opening of a program; • organizing public seminars; • draw-up and distruibution of informative portfolio; • publications on IDAL’s website; • consultations on the program provided by IDAL’s customers service. • Informing potential applicants of project monitoring and fraud prevention
Appraisal of project applications • Documentation checklist procedure: • Non-eligible sectors; • Eligibility check on project activities and costs; • Requested aid does not exceed the amount of aid under the program; • Aid intensity; • Time-set for project implementation corresponds to that provided for by state aid program; • Cumulation of aid; • SME status; • Verification whether enterprise is not in financial difficulties; • Initial investment, the definition of experimental development • Goal of the documentation checklist procedure is to disallow project applications from non-compliance with program provisions
Appraisal of project applications • In-depth appraisal of the project: Validity check of the costs ear-marked for eligibility based on: • publicly available information; • expert rating; • information provided by equipment manufacturers or service providers.
Evaluation system of project appraisal • An inter-institutional body (IIB) carries out an in-depth appraisal (including objective conformity check) • IDAL arranges and provides information to IIB, and does secretarial work • IDAL carries out the documentation checklist procedure • The first evaluation phase ends up with the signing of the contract • IDAL ensures a contract monitoring function
Contract signing and implementation • IDAL drafts a model contract for each state aid program, which includes provisions required by state aid program; the model contract is then proposed for approval to the Managerial Body (Ministry of Economics); • Project reviewed and approved by IIB becomes an integral part of the contract upon conclusion of the contract; • Amendments to the contract (if such) proposed by the beneficiary go under review to ensure they are not in conflict with provisions of state aid program.
Project implementation and post-monitoring • On-the-spot checks: • During project implementation; • After the final payment. • Interim and final checks: • Progress report checks (every 6 months of the project); • Verification of payment claims and expenses incurred.
Compliance with state aid requirements (I) • Objective – to check whether the objectives of the project have been reached and review the eligibility and accuracy of costs incurred for achieving these objectives. • Activities: • On-the-spot checks– verification of the actual works, performed supplies and services based on the project and supporting documentation: • contracts for works, supplies or services provided; • transactions and supporting documents; • Progress report check: verifying whether the project implementation has been carried out in compliance with the project provisions.
Compliance with state aid requirements (II) • Eligible costs: • Adequacy of costs (illegal arrangement of costs): • Public information; • Equipment manufacturers; • Expert rating; • Documentation check: • Check the payment claims included in the cost of items and the supporting documents; • Double financing check to make sure eligible expenses are not included in beneficiary’s operating expenses and any other EU or national, or local project co-financed expenditure: • Accounting records present separate accounts for the project costs; • Existing a separate banking account for the project; • The project documentation bears a reference to the contract concluded with IDAL.
Compliance with state aid requirements (III) • The maximum amount and intensity – check whether the payment claim does not exceed the required amount of support stipulated by the contract and state aid requirements • Project duration –the extension of the project is disallowed if it exceeds the aid program; • Specific requirements by aid programwhich may provide that: • On-the-spot-checks are to verify whether the installations or technologies acquired are new; • The experimental results of development are not used for commercial purposes;
Payment of costs • After all activities under the project have concluded • After IDAL has made it sure that the project objective has been achieved (e.g., the equipment is used for the purpose of beneficiary’s economic activity) • After the final payment IDAL carries out monitoring of the project for 3-5 years