3 FRAMEWORK ADMINISTRATIVE AGREEMENT

Transcription

1 Annex 3 FRAMEWORK ADMINISTRATIVE AGREEMENT between the EUROPEAN UNION (the EU), and the INTER-AMERICAN DEVELOPMENT BANK (the "IDB" or the "Organisation") on actions administered by the IDB and funded or co-funded by the EU Preamble 1. WHEREAS, the IDB and the EU, represented by the European Commission "the Commission", referred to individually as a Party and collectively as Parties" acknowledge the need to define an enabling environment in order to facilitate effective cooperation within the legal and policy frameworks of each of the Parties and in full respect of the EU Financial Regulations 1 by which the EU is bound; 2. WHEREAS, the Commission acts in its capacity to manage the EU's budget and the European Development Fund and, under the EU Financial Regulation, may implement the EU budget directly or indirectly by entrusting budget implementation tasks to the IDB. 3. WHEREAS, the Parties entered into a framework agreement on 19 July 2011 (the "Original Agreement"), and the Parties now desire to amend and restate the Original Agreement; 4. WHEREAS, the Commission has developed standard contractual arrangements for managing EU funds under both Indirect Management and Direct Management (Pillar Assessed Grant or Delegation Agreement, hereinafter: PAGoDA ), adopted by Commission Decision C(2015)XXXX which are applicable to both EU External and Internal Policies, except in the fields of humanitarian aid and research (e.g. Horizon 2020 Programme), which provide such enabling environment; 5. WHEREAS, this Framework Administrative Agreement (the Framework Agreement ) aims at taking into account the specificities of the IDB in the implementation of the standard provisions of the PAGoDA in order to simplify the contractual negotiations; 1 Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council, of 25 October 2012, on the financial rules applicable to the general budget of the Union (OJ L 298, of 26 October 2012, pp. 1-96), and the Regulation (EU) 2015/323 of 2 March 2015 on the financial regulation applicable to the 11 th European Development Fund (OJ L 58, of 3 march 2015, pp.17-38). 1

2 6. WHEREAS, the provisions of this Framework Agreement refer to the version of the PAGoDA and its Annexes applicable at the signature of this Framework Agreement and are applicable mutatis mutandis to its subsequent amendments; 7. WHEREAS, the Organisation is promptly informed, upon approval, of these amendments and will have the right to provide its observations and/or terminate the Framework Agreement in case of disagreement; 8. WHEREAS, this Framework Agreement is subject to the positive assessment of the IDB pillars conducted on the basis of the terms of reference elaborated by the Commission based on Article 60.2 of the EU Financial Regulation (the "Pillars Assessment"); 9. WHEREAS, until the Pillars Assessment is finalised, the Commission deems that, based on the positive outcome of the institutional assessment dated 9 February 2010 and on the longstanding and problem-free cooperation with the IDB, this Framework Agreement and further contracts covered by this Framework Agreement can be signed; 10. WHEREAS, any budgetary commitment on behalf of the EU under the EU Financial Regulations is subject to the conclusion of a specific agreement. NOW, THEREFORE, the Parties hereto agree as follows: PART I: Scope of the Framework Agreement 1. For actions administered by the IDB and financed or co-financed by the EU where such financing or co-financing is entrusted by the Commission or by a partner country to the IDB under Indirect Management, the PAGoDA provisions for Delegation Agreement (Special Conditions for EU Delegation Agreement and its Annexes) shall apply with the provisions set out in Part II of this Agreement, subject to the positive outcome of the IDB pillars assessment. In specific circumstances, the Parties may agree to additional specific provisions or to use another contractual template. 2. The Commission or the partner country shall provide EU funds to IDB, which shall undertake the action including through entering into contracts and/or through making grants to grant beneficiaries, in accordance with IDB Regulations and Rules and subject to the provisions of the PAGoDA. 3. If the Parties agree to extend the scope of this Framework Agreement to include PA Grants Agreements, sub-delegation, and/or other financial instruments, the Framework Agreement will be amended accordingly. 2

3 4. The description of the Action (including the Logical Framework of the Project) to be included as Annex I in any Delegation Agreement shall be based on the corresponding project document approved by the competent governing body of the IDB, provided that it is compatible with the content of the Commission financing decision on the use of EU funds. 5. The budget of the Action to be included as Annex III in any Delegation Agreement shall be based on the budget included in the corresponding project document approved by the competent governing body of the IDB. 6. The Parties further agree on specific verification implementation rules and document retention requirements set out in Annex I and II, respectively, to this Framework Agreement, applicable to all contracts and agreements signed between the Commission and the IDB. Annex I and II apply also when the IDB takes part in actions financed or co-financed by the EU as Sub- Delegatee (in a Delegation Agreement), Co-Beneficiary (in a PA Grant) or contractor or grant beneficiary or recipient of financial support. Annex III of this Framework Agreement on visibility guidelines aims at providing guidance about the implementation of the visibility clause included in Article 8 of the General Conditions of the PAGoDA ("General Conditions"). 7. The IDB will further conclude with OLAF an Administrative Cooperation Arrangement, setting out, inter alia, the details and modalities of implementation of the provisions of Article 17.2 and, in its part pertaining to OLAF, Article 17.3 of the General Conditions or similar provisions in other agreements. Should investigations occur prior to the conclusion of such arrangement, OLAF and the IDB will agree on an ad-hoc basis on the modalities to be applied to such investigations. 8. The Parties also commit themselves to cooperate in order to interpret and apply in a coherent and consistent manner these contractual arrangements while keeping in mind the specificities of the IDB as a public international financial organisation. 9. The obligations of the Parties with respect to the Actions financed by the EU under this Framework Agreement are only those obligations contemplated in the Framework Agreement and/or any agreement made under it and their respective Annexes. 10. Capitalised terms used but not defined in this Framework Agreement shall have the meanings ascribed to them in the PAGoDA provisions for Delegation Agreement. PART II: Provisions applicable to Delegation Agreements 1. Supplementary provisions: 3

4 1.1. Article 7 of the Special Conditions of each Delegation Agreement signed between the parties shall state: 7(1) The following shall supplement the General Conditions: 7(1)(1) Article 2.4, second sentence, shall be supplemented at the end by the following: "following its Regulations and Rules". 7(1)(2) Article 2.4 of the General Conditions shall be supplemented at the end by the following: Prior to bringing legal proceedings for recovery of funds, the Organisation shall consult the Commission on the cost-effectiveness of the legal actions and the payment of associated legal costs. It is understood that, to the extent that the Commission agrees that the Organisation shall not proceed to recover funds through legal proceedings, the conditions of Article 2.5(b) of the General Conditions are deemed fulfilled. Alternatively, the Commission may request the Organisation to assign its claim against the debtor as contemplated in Article 2.5(c). If there is a disagreement between the Parties on the course of action to be taken, the matter may be referred to the responsible Director of the Commission, through the contact point specified in the Special Conditions." 7(1)(3) Article 2.6 of the General Conditions shall be supplemented by the following: To comply with this, the Organisation shall include equivalent provisions in the Grant agreement. This provision shall also apply to Article 3, Article 10 and Article 18 of the General Conditions. 7(1)(4) Article 19.1.b) of the General Conditions shall be supplemented by the following: The legal commitments also include the legal commitments between the Grant Beneficiary and a third party, as proven by the relevant report. 7(1)(5) Article 23.3 of the General Conditions shall be supplemented by the following: Any procurement and grant award procedure shall be open to individuals and firms from any member country of the Organisation, any member state of the European Union and other eligible nonmember countries ( Other Eligible Countries ) contemplated in the applicable regulatory provisions of the EU. The Commission will publish the list (or any updates thereto) as Annex IIa of the Practical Guide to Contract Procedures for EU External Actions (the PRAG ) which is available on its Internet website or which will be provided by the EC upon request by the Organisation. For the avoidance of doubt, the Organisation will act based on the latest version of the PRAG published by the European Commission on that website. 2. Derogation provisions: 2.1 Article 7 of the Special Conditions of each Delegation Agreement signed between the parties shall state: 7(2) The following derogations from the General Conditions shall apply: 4

5 7(2)(1) By derogation from Article 7.1 of the General Conditions, the Organisation shall ensure appropriate protection of personal data in accordance with its applicable regulations and rules. 7(2)(2) By derogation from Article 19.2 of the General Conditions, the payment request for the balance shall be submitted in Euro. The Organisation shall convert the balance recorded in their accounts into euro using the current market rate in effect at the time of the conversion by the Organisation of the EU unspent funds. This rate shall be notified to the Commission in the final report. 7(2)(3) By derogation from Article 23.5 of the General Conditions, "the Organisation maintains a current list of all entities that have been declared ineligible by the Organisation for having engaged in sanctionable practices comprising corruption, fraud, collusion, coercive and obstructive practices. This list is accessible at: If any of these entities are declared ineligible as a result of such sanctionable practices on an EU funded project, the Organisation will notify the Commission consistent with its procedures for keeping donors apprised of fraud and corruption matters relating to actions involving donor funds. 3. Interpretative provisions 1. With respect to Article 1 of the General Conditions, it is understood that: EDF shall mean European Development Fund; DCI shall mean Development and Cooperation Instrument; ENI shall mean European Neighbourhood Instrument: IPA II shall mean Instrument for Pre-accession Assistance; INSC shall mean Instrument for Nuclear Safety Cooperation; IcSP shall mean Instrument contributing to Stability and Peace; PI shall mean Partnership Instrument for cooperation with third countries; EIDHR shall mean European Instrument for the promotion of Democracy and Human Rights worldwide; and their predecessors. 2. It is understood that Article 2 of the General Conditions will be interpreted in light of the following: (a) The Organisation shall be responsible for ensuring that the Grant agreement with the Grant Beneficiary complies with the applicable provisions of the PAGoDA. The Organisation shall be responsible for taking the necessary measures to ensure that the Grant Beneficiary acts in accordance with the Grant Agreement. 5

6 (b) Articles 2.1 through Articles 2.5 will be interpreted recognizing that: (1) the implementation of the Action will be carried-out by a Grant Beneficiary identified by the Organisation and acceptable to the Contracting Authority; (2) the Grant Beneficiary shall be contractually obligated to act in accordance with the Organisation Regulations and Rules; (3) the Grant Beneficiary will be a separate and independent entity, clearly identified in the description of the Action, whose relationship with the Organisation for this Action shall be subject to a Grant agreement to be entered into pursuant to the Organisation s Regulations and Rules (which have been positively assessed by the European Commission) for the implementation of Actions co-financed with donor resources. Therefore, the Organisation shall comply with its obligations under this Agreement relying on information and actions which the Grant Beneficiary shall be contractually required to provide or perform under a Grant Agreement, in a time and form sufficient to meet the obligations of the Organisation established herein. (c) Regarding Article 2.2, given the indicative nature of the Indicators, changes to the Indicators may be made as provided in Article 11.4, taking into account the actual results of the Action reported pursuant to Article 3.6. (d) With respect to Article 2.3, the reference to Regulations and Rules in Article 2.3 does not limit the Organisation s ability to apply specific Regulations and Rules to the EU contribution as it applies to the management of funds administered by the Organisation. (e) Regarding Article 2.4, the reference to full financial responsibility in the first sentence of Article 2.4 means full financial responsibility in accordance with the terms of the Agreement. In connection with the last sentence of Article 2.4, where the Organisation has become aware that funds have been unduly paid or incorrectly used, the Organisation shall start the necessary procedures according to its Rules and Regulations concerning a decision on recovery. (f) With regard to Article 2.8, to comply with Article 2.8, activities financed under the Agreement shall respect the social and environmental safeguard policies applicable to the Organisation. 3. It is understood that the condition set out in Article 2.5(c) of the General Conditions is deemed fulfilled if: (a) The grant agreement provides that the Organisation, if requested by the Commission, shall assign to the Commission the right to claim recovery of funds under the grant agreement; or (b) On a case-by-case basis, the Commission agrees that it is not possible, not practicable or not appropriate to provide for the right to assign in the grant agreement or to request the assignment contemplated in point (a) of this interpretative provision. 6

7 4. It is understood that Article 3 of the General Conditions will be interpreted in light of the following: (a) Information and reporting prepared by the Organisation in accordance with Article 3 shall be based upon information and reporting prepared by the Grant Beneficiary in a manner consistent with the Organisation s Regulations and Rules. (b) Regarding Article 3.6(b), an updated table shall include such results achieved by the Action as available. (c) For the purposes of Article 3.7, for avoidance of doubt, the term period of implementation shall mean the Implementation Period, as this term will be defined in the Special Conditions. (d) Regarding article 3.7(f), the phrase are covered by other donors contribution that consider those cost as eligible means that such costs that are not eligible as contemplated in Article 3.7 will have been covered by another source of funding or as otherwise have been provided for in accordance with the Organisation s Regulations and Rules. (f) With respect to Article 3.11, notwithstanding the fact that the Organisation has a Framework Agreement, the audit opinion to be provided by the Organisation (pursuant to Article 3.12) will be provided on an annual basis in the form of an audited financial statement of the Action, which may cover EU and any other funding resources of the Action. The Organisation and the Commission may reach a separate arrangement at a later date for the application of Article For the implementation of Articles 3.8 and 19 of the General Conditions, Special Conditions may provide for specific reporting periods if requested by the Organisation. 6. For the purposes of Article 5.1 of the General Conditions, the Organisation shall, in accordance with its Regulations and Rules, identify and take appropriate measures to avoid or resolve conflict of interest situations. 7. With respect to Article 8.1 of the General Conditions, the Communication and Visibility Plan detailed in Annex VI shall be prepared in accordance with the guidelines included in Annex III of the Framework Agreement. 8. For the purposes of Article 9.2 of the General Conditions, the use by the Commission of such results will be limited to the purpose of the development, implementation and monitoring of EU actions and policies and dissemination thereof. 9. With respect to Article 11.4 of the General Conditions, agreement on changes to the Indicators will be deemed to have been granted if the relevant progress/final report mentioning such changes is approved without observations by the Contracting Authority. 7

8 10. It is understood that Article 12 of the General Conditions will be interpreted in light of the following: (a) Article 12.1: The term time limit shall refer to the deadline by which the Contracting Authority shall provide payments: i) with respect to the pre-financing instalment as set out in Article 4.2 of the Special Conditions, 30 days of receiving the Agreement signed by both Parties as contemplated in 19.1a); ii) with respect to further the further prefinancing instalments and the balance, 90 days of receiving a payment request accompanied by a progress or final report as contemplated in 19.1d). (b) Article 12.1(d) : If the Organisation, in its observations submitted pursuant to Article 12.2, confirms that it is taking remedial measures to cure the situation, which are considered satisfactory by the Contracting Authority, the suspension of the time limit for payment will be lifted. (c) Article 12.4 and 12.6 shall be interpreted as follows: 1. If the Organisation, in its observations submitted pursuant to 12.4 and 12.6, confirms that it is taking remedial measures to cure the situation, which are considered satisfactory by the Contracting Authority, the suspension of payment or of the Agreement will not be needed. 2. The Organisation may submit a justified request for an extension of the deadline to submit observations contemplated in Article 12.4 and 12.6, such request shall not be unreasonably denied by the Contracting Authority. 3. If the Organisation decides to suspend payments or the agreement applicable to the use of its own resources with the Grant Beneficiary or if the Organisation decides to suspend the implementation of such agreement, it shall promptly notify the Contracting Authority, which then may decide to suspend payments or the Agreement. 4. With reference to Article 12.6, it is understood that any decision to suspend the Agreement will be made, after the Organisation has been given the possibility to submit observations, in consultation with the responsible director in the Commission. 11. It is understood that Article 13 of the General Conditions will be interpreted in light of the following: 1. If the Organisation decides to terminate the agreement applicable to the use of its own resources with the Grant Beneficiary, it shall promptly notify the Contracting Authority, which then may decide to terminate this Agreement under Article With respect to Article 13.1, it is understood that penalties foreseen in EU Financial Regulation shall not apply to the Organisation under Indirect Management. 8

9 3. The Organisation may submit a justified request for an extension of the 30 days term contemplated in Article 13.2 and such request shall not be unreasonably denied by the Contracting Authority. 4. Without prejudice to the right of the Contracting Authority to terminate the Agreement, if the Organisation, in its observations submitted pursuant to Article 13.2, confirms that it is taking remedial measures to cure the situation, which are considered satisfactory by the Contracting Authority, the termination will not be needed. 5. In the event of termination under Article 13.2, the final amount of the EU Contribution shall be determined in accordance with Article 20 on the basis of the part of the Action carried out up to the date of termination. 6. With respect to Article 13.3, the term Final Amount means the final amount to be calculated in accordance with Article 20 of the PAGoDA. 7. With respect to Article 13.3ii), it is understood that the unavoidable residual expenditures include the costs necessary for the closure of the activities financed under the Agreement. 12. With respect to Articles 15.1 and 15.2 of the General Conditions, it is understood that the amount due by the Organisation pursuant to Article 20.1(b) of the General Conditions and to be recovered by the Contracting Authority will be determined taking into account the actual implementation of the Action. 13. With respect to Article 15.3 of the General Conditions, it is understood that the Contracting Authority shall not offset any amount waived from recovery pursuant to Article 2.5. The Parties whenever possible will endeavor to discuss in good faith any measures that may be needed to Agreements for Actions affected by an offsetting of any amounts due to the Organisation under the Framework Agreement. This shall not affect the Parties' option to agree on payment in instalments. 14. It is understood that a waiver of recovery by the Commission in accordance with Article 2.5 and/or Article 15.7 of the General Conditions shall relieve the IDB of its obligation to repay such corresponding funds. In such cases, the Commission will not pursue the recovery procedure for the amount contemplated in the waiver and the Organisation shall not be liable for the repayment of funds corresponding to such amount to the Commission. 15. Article 16.1 of the General Conditions is interpreted as follows: In the administration, management and use of EU resources, the Organisation shall contractually require the Grant Beneficiary to keep accurate and regular records and accounts. The accounting Regulations and Rules of the Organisation shall apply. For the purposes of Article 16.3 of the General Conditions, archives shall only be kept after the period of five years if the Organisation is aware of any claim initiated before the expiration of 9

10 the period of five years. The archiving obligations established here apply only to the documents listed in Annex II of the Framework Agreement. 16. With respect to Article 17.2 of the General Conditions, the references to EU law relate only to the procedures applicable to OLAF in order to carry out investigations, including on-thespot checks. The scope of the investigations, including on-the-spot checks, contemplated in Article 17.2 shall be limited to the protection of the financial interests of the EU in relation to the Action. 17. Regarding Article 18.1a) of the General Conditions, for the avoidance of doubt, the Grant Beneficiary may use the EU resources for the payment of procurement contracts. 18. With respect to Article 18.4 of the General Conditions, the Organisation may use the prefinancing instalments paid by the Commission as it deems appropriate for the proper management of EU funds and the proper implementation of the Action. It is understood in particular that the Organisation may decide on the amounts to be retained for its own account from any pre-financing instalments (including from the first pre-financing instalment only) in order to cover the remuneration as referred to in Article 3.2 of the Special Conditions and Article 18.4 of the General Conditions. 19. With respect to Article 20.3 of the General Conditions, it is understood that a substantial breach of an obligation under the Agreement will be dealt with as soon as the Contracting Authority becomes aware of it, in accordance with the remedies provided by the Agreement. The Organisation may submit a justified request of extension of the deadline for providing its observations and this request shall not be unreasonably denied. 20. With respect to Article 22.1 of General Conditions, it is understood that the obligation of publication is not applicable to the contracts and grant agreements awarded by the Grant Beneficiary. It is understood that the term locality shall mean the address of the Grant Beneficiary indicated in the Grant Agreement or of any Contractor under Procurement Contract signed by the Organisation. 21. With respect to Article 23.4 of the General Conditions, reasonable measures may include a requirement for a declaration of honor to be provided by the potential candidates or tenderers and applicants. 4. Interpretative provisions to the template of European Union Delegation Agreement Special Conditions": 1. With respect to Article 2.5, the Contracting Deadline shall only apply to: 1) Procurement Contracts entered into by the Organisation and a Contractor, if any, and 2) the Grant contract for implementing the Action between the Grant Beneficiary and Organisation. This Contract Deadline does not apply to subsequent Procurement Contracts and/or sub-grant contracts entered into by the Grant Beneficiary and Contractors (or other third parties); such contracts may be signed by the Grant Beneficiary at any time during the Implementation Period. 10

11 2. With respect to Article 3.2 of the Special Conditions of the Delegation Agreement, it is understood that unless the Parties otherwise agree 2, the remuneration of the Organisation for the implementation of the activities entrusted under the Agreement will be 5.8% of the final amount of accepted expenditure (which includes 0.5% for customisation), unless the rules of the funding sources provide for a lower rate. PART III: Specific Contact Points 1. The Contact points within the IDB having the appropriate powers to co-operate directly with the European Anti-Fraud Office in order to facilitate the latter s operational activities are: Attention: Chief Office of Institutional Integrity Inter-American Development Bank Tel: +1 (202) New York Ave., NW Fax: +1 (202) Washington, D.C U.S.A. pre-oii@iadb.org 2. All communications permitted, required or otherwise related to this Framework Agreement will be directed to: (a) For the IDB: Attention: Manager Office of Outreach and Partnerships Inter-American Development Bank Tel: +1 (202) New York Ave., NW Fax: +1 (202) Washington, D.C U.S.A. partnerships@iadb.org All such communications will be sent with copy to: Attention: Chief, Grants and Co-financing Management Unit Office of Outreach and Partnerships Inter-American Development Bank Tel: +1 (202) New York Ave., NW Fax: +1 (202) Washington, D.C U.S.A. orp-gcm@iadb.org (b) For the European Commission: European Commission Directorate General for International Cooperation and Development - Europaid For the attention of the Head of Unit of the Legal Affairs Unit Rue de la Loi 41 2 For the purpose of other financial instruments (such as the EU blending facilities) mentioned in Part I, Section 3 of this Agreement, the remuneration will be set in the relevant Delegation Agreements. 11

12 B-1040 Bruxelles The Parties will inform each other in writing without delay of any change in the above mentioned contact points. PART IV: Entry into force, termination, amendments 1. This Framework Agreement shall enter into force on the date the latter of the parties duly signs. From this date the Original Agreement is replaced by the present Agreement. 2. This Agreement shall not affect contracts entered into force between IDB and the Commission prior to the date of its entry into force, which shall remain governed in accordance only with their own terms, unless otherwise agreed on a case by case basis by the Parties in writing. 3. The Parties undertake to promote regular exchange of information on all matters arising out of this Agreement. 4. Any amendment to this Framework Agreement, including any of its Annexes, shall be done in writing by exchange of letters between the Parties. The Organisation will be informed, upon approval, of the amendments of the PAGoDA and will have the right to provide its observations and/or terminate the Framework Agreement in case of disagreement. 5. Either Party may terminate this Framework Agreement by serving six months written notice. Unless the Parties agree otherwise, the contracts governed by the terms of this Framework Agreement which entered into force before the date of termination, shall not be affected by the termination. IN WITNESS WHEREOF the undersigned, being duly authorized thereto, have signed this Agreement. For the Commission ( ) On behalf of the European Union For the Inter-American Development Bank ( ) 12

13 ANNEX I AGREEMENT ON THE VERIFICATION IMPLEMENTING RULES 1. Interpretation of verification provisions As regards Article 17 of the General Conditions (GC) of the Pillars Assessed Grant or Delegation Agreement (PAGoDA), or similar provisions in other agreements, it is agreed that all financial information relevant to the Actions financed by the European Union shall, upon request, be supplied to the Commission 3. It is understood that the information shall be drawn from accounts and records and will be in a form which makes it possible for the European Union to verify the use to which its funds or contributions have been put and that EU funds are properly used in accordance with the Framework Agreement and the conditions laid down in each contract and agreement signed. It is further agreed and understood that clarifications, including verification of specific documents, may be requested by the European Union. As regards the checks to which reference is made in Article 17 of the GC of the PAGoDA, or similar provisions in other agreements, it is understood that representatives of the European Union will be given access to the site(s) of the Action, taking into account, in the case of the European Commission, the guidelines for verifications under point 2 below. It is understood that such checks will be limited to information on the use of EU funds and is without prejudice to the immunities of the Organisation as set forth in the respective Articles of Agreements or Conventions. Any question of application and interpretation, as well as any dispute, arising from this Agreement shall be resolved by amicable means between the Commission and the Organisation, without prejudice to Article 14 of the GC of the PAGoDA or similar provisions in other agreements. Each party to this Agreement is to bear its own costs under the arrangements. 2. Guidelines for verifications by Commission to the Organisation 2.1 Purpose of the verifications Commission services, which are responsible for financing or co-financing Actions administered by the Organisation, are required by the Financial Regulation to verify the legality and regularity of the expenditure and that it is in accordance with the principles of sound financial management. The Commission acknowledges the mandated primacy of the Organisation oversight and internal control systems and, in keeping with internationally-accepted practice in the discipline of financial oversight and control, will endeavour to build reliance on these systems. 3 The present Agreement only applies to the European Commission. References to the Commission hereinafter shall be deemed to apply of the European Commission's services and their representatives, excluding OLAF. 13

14 The Organisation nevertheless recognises the need for the Commission, as applied to the relevant Action, (a) to obtain an assurance that an adequate system of accountability is in place (accounting systems and procedures, reporting, including the oversight mechanisms), (b) to acquire an understanding of that system, and (c) to report to its own institutions on the proper use of the EU funds. The verification shall not constitute a reassessment of the Organisation s oversight and internal control system already evaluated by the Commission as part of the Pillar Assessment. The verifications carried out in accordance with this Annex shall allow the Commission to meet its above-mentioned needs. The provisions allowing the Commission to carry out such verifications - the verification clause - are contained in Article 17 of the GC of PAGoDA or similar provisions in other agreements. 2.2 Preparation of the verifications Requests by the Commission for on-the-spot verifications and desk reviews shall be sent to the Organisation, as follows: Attention: Chief, Grants and Co-financing Management Unit Office of Outreach and Partnerships Inter-American Development Bank Tel: +1 (202) New York Ave., NW Fax: +1 (202) Washington, D.C U.S.A. orp-gcm@iadb.org In order to ensure that this Agreement functions satisfactorily, it is important that the verifications are carefully prepared, that sufficient notice, at least two months, is given and that the Organisation is informed in advance on matters, which include, but are not limited to, the timing of verification, questions the verification team wishes to review with the management of the Organisation, the nature of the financial information and whether verifications are to be conducted at headquarters locations and/or field offices, or the Grant Beneficiary's offices. This will ensure that the necessary documentation, which may not be readily available, can be prepared. 2.3 Conduct of the verifications Verifications by the Commission should be conducted in a collaborative manner between the Commission's representatives and the Organisation's operational and accounting services. The verification will be carried out by European Commission representatives in a reasonable manner and without creating an undue burden on the Organisation's or the Grant Beneficiary s regular operations. The verification team performs procedures which the Commission has specified and listed in in Terms of Reference for verification missions of International Organisations, elaborated by the Commission. The verification team does not provide an audit opinion but a report of factual 14

15 findings. The objective is not to carry out an audit of the Organisation but to verify, by samplechecking, how the EU funds have been used. The Organisation will allow or request the Grant Beneficiary to allow, as the case may be, the verification including visual inspection - by Commission representatives of original or certified true copies justifying vouchers such as invoices, replies to calls for tender, proof of payments, etc, subject to the requirements established in Annex II Supporting Documents of the Framework Agreement. The verification team shall have access to all original documents (which may be in electronic form) or certified true copies, for verification purposes. Documents will only be photocopied if this is necessary and copies will not be taken of documents which the Organisation or the Grant Beneficiary considers particularly sensitive. The Organisation will assist the verification team in seeking access to information held by other third parties, on the basis of the obligations transferred to third parties in line with the GC of PAGoDA namely, article 2.6 and Annex II Supporting Documents of the Framework Agreement, or similar provisions in other Agreements. In cases where the verification team identifies serious problems of mismanagement, irregularities, weaknesses in the control systems and procedures, it will inform the European Commission and the Organisation. The verification team will make a draft of its report available to the Organisation's Management and provide sufficient time for comments prior to final issuance. 2.4 Procedure for dealing with problems arising during a verification If problems arise concerning access to documentation or any other aspect of this Agreement, the verification team shall contact immediately the responsible Director at Commission headquarters in order to resolve difficulties without delay and to complete the verification on time. 15

16 ANNEX II SUPPORTING DOCUMENTS Document Retention Requirements for Verification and Audit Purposes In accordance with Article 16.3 of the PAGoDA, the following information and documentation, where relevant and in accordance with the Organisation's document retention policy, shall be retained and be kept until five years after the End Date : The financial information of the Organisation in respect of the EU funds deposited and the disbursements made therefrom, complemented by: Evidence that the grants and contracts were awarded by the Organisation in accordance with its Regulations and Rules. For Grants to Grant Beneficiaries by the Organisation: o the agreements between the Organisation and the Grant Beneficiary, and all addenda thereof; o Grant Beneficiary s financial and narrative progress reports that were submitted to the Organisation; o Organisation's monitoring of reports of the Beneficiary's actions and expenditures (including procurement and financial management assessments); o Beneficiary's financial information related to the Grant, including audit reports, invoices and payroll records; o Grant Beneficiary's implementation documentation (including sub-agreements, procurement files, contracts and purchase orders). For contracts for services, goods or works by the Organisation, if any: o The contracts between the Organisation and the Contractors or the order forms placed by the Organisation, including invoices and payments; o Evidence that the services/goods/works were procured by the Organisation in accordance with its policies and procedures, including the deliverables associated with these contracts. o The invoices paid by the Organisation or the receipts; o Evidence that the services were provided, that the goods were supplied (such as delivery slips) or that the works were completed (such as acceptance certificates) as required by the Organisation in accordance with its Regulations and Rules; o Evidence of payment to service providers, suppliers or contractors (including bank advice or bank statements). 16

17 ANNEX III VISIBILITY GUIDELINES 1. Objective This annex aims at providing guidance to EU and Organisation staff about the implementation of the visibility clause included in Article 8 of the PAGoDA and the preparation of the Communication and Visibility Plan for each Action, aimed at improving public understanding of the role of the Parties in co-financed actions. 2. Guidance a. Improving public visibility and understanding of the Action will depend primarily on communication initiatives of staff in both institutions. These initiatives will be agreed ahead of the implementation of each Action, and set out in a Communication and Visibility Plan. b. The Parties commit themselves to provide guidance as needed. c. In all their common actions, the EU and the Organisation will use a common visual identity to put emphasis on their partnership. d. All press releases, publications, training programs, seminars or symposia or other public information materials issued shall clearly indicate that the activities have received funding from the European Union. e. Periodic and final reporting as per Article 3 of the PAGoDA will include information on any measure taken to identify the EU as the source of financing. f. Whenever possible and appropriate, joint press releases and joint media activities should be undertaken to promote the partnership and to highlight common achievements. The Organisation and the EU shall invite each other to participate at press conferences, donor conferences and public debates on Actions where the EU is a significant contributor. g. The Organisation should ensure appropriate acknowledgment on any vehicles, and if appropriate, any equipment and any supplies (including display of the EU logo/flag) funded by the EU funds. h. Where high level visits are planned concerning joint funded activities, the Parties will inform each other and consider coordinating these visits and agreeing on joint messages. i. Overarching Criteria In identifying appropriate communication for visibility activities, certain overarching criteria will be taken into account: a. Size and proportion of the EU's financing: 17

18 The EU recognizes that visibility activities need to take into account and reflect the multi-party nature of multi-donor agreements, even as they highlight the partnership with the EU. In the event that the EU contribution is to a Multi-Donor Action or is channeled through a trust fund established for regional or broad thematic initiatives, and where it is not reasonably possible or appropriate to identify the activities financed by the EU, visibility for the EU contribution will be provided within the context of broader visibility and communication designed for the overall initiative. This issue will be discussed between the Parties on a case-by-case basis during the inception phase of the action, and the outcome will be reflected in the relevant Delegation Agreement. b. Urgency: Where a speedy intervention is envisaged in response to a sudden crisis, a Communication and Visibility Plan does not need to be immediately prepared. It should nonetheless be ensured that in such situations the EU's support for Actions is displayed from the start in an appropriate manner for such Actions. c. Nature of the Action: The Communication and Visibility Plan should be adapted to the nature of the Action. The thematic area and geographical scope of the Action should set the parameters of the visibility activities. For instance, actions relating to coordination, security, etc. are unlikely to require a major visibility component, if any. d. Security and other considerations> Factors such as security or local sensitivities may curtail information activities in some crisis zones and, in extreme cases, it may be necessary to avoid visibility altogether. Some Actions require a high level of neutrality. In these cases, the target audience and visibility tools will be chosen in relation to what is appropriate, in consultation and agreement with the Commission. When standard procedures for visibility are not possible due to security reasons, the visibility requirements will be foregone, or possible alternatives arranged where appropriate (e.g. communication actions in EU member states). Where standard procedures on visibility are not possible because of insecurity and/or sensitivities, the steps agreed to be taken at country level will be communicated to EU and Organisation headquarters. 18