European Economic Community: Regulations of European Development Fund

European Economic Community: Regulations of European Development FundSource: International Legal Materials, Vol. 4, No. 4 (JULY 1965), pp. 749-759Published by: American Society of International LawStable URL: http://www.jstor.org/stable/20689951 .

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E.E.C. EUROPEAN DEVELOPMENT FUND REGULATION* 749

Journal Officiel des Communaut?s Europ?ennes (Mission Translation)

.193, Nov. 26, 1964

EUROPEAN ECONOMIC COl^UICITY

REGULATIONS

Commission Regulation No.l34/64/i?C of November 13, 1964

deternining the procedures for the functioning of th? European Development Fund

THE C01-2 SSI0N C? THE EUROPEAN ECONOMIC COILlU.ilTY,

in view of the Treaty establishing the European Economic Community,

in view of the Convention of Association between the European Economic Community and the African and Kalgasy States Associated with that Conjroinity (1), herein after called "the Convention11,

in view of the Council decision of February 25, 1964, which established the# pro visions concerning the Association of Overseas countries and territories with the European Economic Community (2), hereinafter called "the Decision", and which by virtue of its Article 24, provides for the application of Title II con

cerning Financial and Technical Cooperation as well as of its Annexes III, IV, V, to the French Overseas Departments,

in view of the internal agreement concerning the financing and management of

Community aid (3), hereinafter called "the Internal Agreement",

in 'view of the Financial Regulation of the European Development Fund (4) , here iniftcr called "the Financial Regulation",

considoring that Article 47 of the Financial Regulation entrusts the Commission, subject to 3;.ccifcl provisions for the tasks of the European Investment Bank, with the fixing of rules concerning "the sutxnission and examination of requests for

financing, a o veli as the conditions governing the implementation and audit of the projects and programs,

HAS LAID DO.,;. PHIS REGULATION:

TITLE I - Accoures of the Coavaission

Article 1

The payants referred to in Article 46 of the Financial Regulation shall be carried out by the Commission, or according to its instructions, by drawing on the accounts of the European Development iund, hereinafter called "the Fund"?

(1) J.O. Ko.93 of June 11, 1964, p. 1431/64 (2) J.O* No.93 of June 11, 1964, p.1472/64 (3) J*0. No.93 of June 11, 1964, p.1493/64 (4) J.O. No.93 of June 11, 1964, p.1498/64

[Reproduced from an unofficial translation prepared by the United States Mission in Brussels and provided by the U.S. Department of

Commerce.]



In allying Article 15, Paragraph. 2 of the Financial Regulation and fcr effecting nv-rants in the Associated Overseas States, countries and territories, necean ^ ^ be opened with financial institutions chosen aid authorised by the Co,~ission. These institutions shall exercise the functions of an authorized disbursing agent (payeur-d?l?gu?).

The accounts shall be opened on behalf of the Commission and established in the currency of one of the Member States*

Article 2

The signatures of the agents of the Commission authorized to carry out transactions on the accounts of the Fund shall be deposited when the accounts are opened or, for agents appointed later on, when they are designated.

Title II - Submission and examination of requests for financing.

Article 3

The dossiers of projects or programs, referred to in Article 21 of the Convention and in Article 18 of the Decision, submitted to the Commission of the European Economic Community, shall be addressed to the Directorate General for Overseas Development?

Article 4

The dossier suomitted for each project or program shall permit the economic, social, financial, legal, technical and administrative evaluation aspects of the problem. Before acknowledging receipt of such a dossier, the Commission shall ascertain whether it is set up in accordance with the provisions of th?s Title arid of the directives laid down by the Principal Authorizing Officer Ordonnateur principal^ of the Fund.

Article 5

The projects or programs shall be examined by the Commission which may arrange for supplementary examination on the spot or for an expert report. At the request of the competent authorities or with their approval, the Commission shall implement the technical assistance measures listed in Article 4 of Proto col Ko.5 attached to the Convention, and in Article 4 of Annex V to the Decision*

Article 6

For each Associated State, country or territory, the responsible authori ties shall provide the Commission with information permitting the evaluation of the economic, financial and social situation of the country, the development plan and its implementation, as well as the places of the various projects or programs within the plan. This information shall be reviewed at regular inter vals to assure that it is up to date.



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CHAPTER I - ECQIX! JC AND SOCIAL INVESTMENTS AIO) TECHNICAL ASSISTANCE OOlftffiCTED ttl?H SUUH INVESTMENTS

Article 7

Dossiers relating to investment projects and technical assistance projects connected with such investments, referred to in Article 17* Paragraph 1 of the Convention and in Article 16, Paragraph 1 of the Decision, shall be set up in accordance with the provisions laid down by the Principal Authorising Officer of the Fund.

Article 8

The Commission shall evaluate the influence the project may have on the economic and social development of the benefitting country and of the area where the project is implemented.

It shall examine, in particular:

- the importance and urgency of the needs to be satisfied by the project;

- the place of the project within a development program or plan;

- the contribution of the project to the improvement of existing structures and, more particularly, to the diversification of production;

- the contribution of the project to the development of the region, in parti cular to the creation and extension of a "pole of growth"j

the influence of the project on the programs carried out or envisaged in other areas of the country or, should the occasion arise, in border areas of neighboring countries;

- the contribution of the project to a rise in the standard of living of the population, to the employment and income of workers as well as to the pro motion of savings;

- the importance of the private investments induced;

- the effect of the project on the trade balance and the balance of payments;

- the experience gained from the realization and implementation of similar in vestments in the same branch of activity;

- in the case of productive investments, the profitability of the project, do mestic and foreign outlets open to the new production, the possibility of assuring local processing of such production, and the relative importance of the value added;

- in the case of investirent s concerning education or treating, openings and employment likely to be offered to those benefitting from the measures;



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co-'lo-ontary investments necessary or useful for the full effectiveness of the project envisaged;

~ the existence of the personnel and equipment necessary for the operation of the investment and, where necessary, the need for additional personnel which would have to be covered temporarily by technical assistance;

- the concept and the means for technical realization and their adjustment to the economic and social- conditions of the country; - the recurrent charges resulting from the putting into service of the pro

ject and of other current projects in the same sector, as well as the ways and means of covering them; -

guarantees for the successful completion of the project*

CHAPTER II - GENERAL TECHNICAL COOPERATION MEASURES

Article 9

Dossiers concerning the general technical cooperation measures referred to in Article 17, Paragraph 2 of the Convention and in Article 16, Paragraph 2 of the Decision shall be set up in accordance with the provisions laid down by the Principal Authorizing Officer of the Fund,

Article 10

General technical cooperation measures for the training of nationals of the Associated States, countries and territories, referred to in Article 9 of Protocol No*5 attached to the Convention ai:d in Article 9 of Annex V to the Decision shall be subject to an investigation during which the Commission shall evaluate ?x particularly:

- the relation between the training programs submitted and the need need for supervisory and qualified professional personnel;

- the breakdawn of /educational/ levels and the specializations required for a balanced functioning of the various sectors of economic, social and cul tural activity;

- the possibilities of assuring training under the most efficient and most rational conditions in the establishments of the A0Cfs or in the Member States or in the services of the Communities; - the guarantees for employment of staff thus trained; - in cases where experimental and demonstration equipment is supplied,the possibilities for their utilization under the best conditions; - the anticipated effect the implementation of the training program will have on the economic, social and- cultural development of the country*



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Article 11

The general technical cooperation measures referred to in Article 9$ Para graph f of Protocol No.5 attached to the Convention, and in Article 9, Paragraph f, of Annex V to the Decision, shall be the object of overall programs proposed by the Community.

The beneficiaries of such measures shall be:

a) as regards training courses of short duration: persons studying or improving their training in Europe or elsewhere, in particular nationals of the Associated Overseas States and Countries or persons from the French Overseas Territories and Departments;

b) as regards bulletins or other documents intended to maintain contact with participants in the various training and information programs: these par ticipants.

CHAPTER III - AIDS TO DIVERSIFICATIOK AND PRODUCTION Article 12

The aid programs subndtted by each Associated State under Article 25 of Protocol.No.5 attached to the Convention, shall be established in accordance with the provisions laid down by the Principal Authorizing Officer of the Fund.

It shall be divided into annual instalments as regards production aid, while aid to diversification shall be the object of projects the dossiers of which shall be set up and examined under the conditions determined in Chapter I of the present Title.

Without prejudice to the provisions of Articles 27 and 33 of Protocol No.5 attached to the Convention, aids to production -

including structural improvement measures - shall be examined, decided upon and implemented in accordance with the rules here-below.

Article 13

V/ithin the framework of the subsidies program, annual subsidies will be granted on an indicative basis on a decreasing scale fixed market season by mar ket season.

Article 14

The first annual instalment shall be requested on submission of the subsidies program. The subsequent annual instalments shall be requested six months before the beginning of the corresponding marketing season. The documents presented on submission of the program shall include, in particular, together with appropriate justifications for each product, the designation of the authorized body charged with the distribution of the subsidies and the anticipated due date of payments.

Article 15

During the marketing season, funds appropriated for aid to production that



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are not likely to be used, may, at the request of the Government of the interested AOC, be allocated for aid to diversification measures in accordance with the pro cedure provided for in Article 11 of the Internal Agreement.

Article 16

The final settlement of each annual instalment shall take place within three months after the end of the market season on the basis of the detailed, audited and approved report, provided for in Article 32 of Protocol No.5 attached to the Convention. In accordance with the provisions of Article 29, Paragraph 4 of the said Protocol, unexpended appropriations nay either be carried over as aid to production during the current marketing season or be allocated to aid to diversi

fication. The above-mentioned report shall, to this end, be completed by propo sals or projects.

CHAPTER IV - ADVANCES TO STABILIZATION FUNDS

Article 17 Advances to the stabilization funds shall, within the limits of the amounts

fixed in Article 20 of the Convention, be granted by Associated State, by product and by marketing season under the conditions laid down in Chapter V of Protocol No.5 attached to the Convention and in Article 54 of the Financial Regulation.

Requests for advances may be submitted during the marketing season.

Article 18

The documents submitted in support of the requests for advances shall in clude, in particular, the following data:

- domestic price system, situation of world markets, justification of the amount of the advance requested;

- report of the Management Board of the Stabilization Fund concerning the request

for advances, and abstracts from the minutes of the Board, approving that request;

- indications as to the supporting documents provided for the use of the advances, and the terms and conditions governing the use of the requested appropriations;

- proposals relative to the schedule by which advances shall be made available;

- proposals concerning terms of reimbursement;

- opinion of the Government on?the transactions proposed by the Stabilization

Fund and information on the financial audit carried out by it.

- Guarantee granted by the State under its constitution for the envisaged transaction.

Article 19

The decision on granting advances shall stipulate, in particular, the terms

of reimbursement, the method of calculating terms and conditions of repapnent.



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Article 20

The settlement of advances shall take place definitively within three months after the end. of the marketing season, based on a report of the Sta

bilization Fund in the benefiting State, submitted by the Government concerned*

CHAPTER V - EMERGENCY HELP

Article 21

Emergency help referred to in Article 39 of Protocol No.5 attached to the Convention may be granted upon the request of the competent authorities of the interested State or on the proposal of the Principal Authorizing Officer of the Fund, The financing decision shall be taken under the conditions esta blished in Article 4 of the Rules of Procedure of the Fund Committee.

TITLE III - l?IPLEMSMTATIOM OF PROJECTS AMD PROGRAMS

Section I - General Provisions

Article 22

The Principal Authorizing Officer of the Fund shall assure the implementa tion of financing decisions vdthin the framework of the provisions of the Fi nancial Regulation. Ke shall take measures of adaptation and decisions on

obligation of funds which might prove necessary to assure the successful imple mentation of the approved project or program under the best economic and tech nical conditions.

Article 23

As regards measures the ImpleDentation of which is directly incumbent on the Commission, the Principal Authorizing Officer shall obligate and sanction expenditure in accordance with the provisions of Title II of the Financial Re gulation of the Fund. To this end, he may have recourse to the delegated Author izing Officer mentioned in Article 12 of that Regulation,

Article 24

If the implementation of the projects and programs submitted by the interested Governments falls under the latters1 responsibility, it shall be assured by the local authorizing officer appointed by the. Financing Agreement provided in Article 15 of the Financial Regulation.

Subject to special clauses in that Agreement, such projects or programs shall be implemented in accordance with the provisions of Section II heretelow.

Section II - Implementation in the Benefitting Countries

CHAPTER I - FINANCIAL CO&JTTl-lENTS

Article 25

The Financing Agreement shall specify the financial committment of the Fund, the terms and conditions of financing, as well as the persons or institutions charged with audits, payments and re-imbursements.



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With respect to aid to production, the Financing Agreement shall lay down the terms and conditioris concerning the payments and the supporting documents.

As regards advances to the Stabilization Funds, an Advances Agreement con cluded beforehand between the Commission and the benefitting Fund shall determine the conditions fot the implementation, of the decision granting the regularization advance. This Agreement shall fix the conditions under which the granted advance shall be made available, indicate the supporting documents to be submitted when the payments are made, sp?cify the terras and conditions of auditing and determine the method of calculating the term as well as the delays and methods of re-imburse ment. The text of the document by which the interested Associated State grants the guarantee provided in Article 21 of Protocol l?o.5 shall be attached to the Agreement and be part and parcel thereof.

Article 26

Wo expenditure exceeding the amount fixed in the Financing Agreement may be charged to the Fund unless it has been in due time the subject of a supplementary committment under the conditions referred to in Articles 19 to 22 of the Financial Regulation.

The request for a supplementary connrittment shall be addressed to the Com mission under the conditions laid down in the Financing Agreement.

Article 27

If the Principal Authorizing Officer considers it necessary, he may, in spe cial cases, in agreement with the interested Government, make available the funds necessary to cover supplementary committments by reducing committments for cur rent projects or programs.

Article 28

The Principal Authorizing Officer of the European Development F!und shall take all necessary measures for the implementation of the provisions of Article 47# Paragraphs 2 to 4 of the Financial Regulation.

Work contracts or supplies necessary for the implementation of the projects or programs shall be the object of public calls for bids in lots as large as de sirable from a technical and economic point of view.

As regards certain measures relating to aid to production, should there be a case of emergency or should the nature, the snail size, or the particular fea tures of certain works or supplies justify it, the Principal Authorizing Officer may, on an exceptional basis, authorize:

- award of contracts after a limited call for bids;

- conclusion of contracts by direct agreement;

? execution under State supervision (regie administrative).



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The execution under state supervision shall t^<3 place on the basis of an estimate previously approved by the Principal Authorising Officer who, on this

occasion, shall specify the terras and conditions under which the appropriations are made available.

In order to obtain the most advantageous offer from an economic stand-point by participation of the largest possible number of bidders, the Principal Authorizing Officer may prescribe a uniform text for the general and special specifications.

Prior to the publication of the calls for bids, the Principal Authorizing Officer shall ascertain that the specifications do not include discriminatory provisions. Ke shall see to it that a comparison of offers takes place on equal terms and, in particular, that the incidence of it-port duties or of the fiscal

system of the benefitting country does not harder participation in the calls for bids.

The Principal Authorizing Officer can suspend publication of a call for bids or the launching of an exceptional procedure when it appears that corrections must be made in the specifications or documentation. To this end, he will notify his observations to the coapetent authorities.

The Principal Authorizing Officer shall see to it that the provisions of Article 47, Paragraph 3 of the Financial Regulation are observed in choosing a bidder and in awarding a contract.

CHAPTER II - THE LOCAL AUTHORIZING OFFICER /?RD0M;ATEUR7

Article 29

Within the limits of the appropriations allocated to him, the local authoriz

ing officer appointed by the Financing Agreement or the Advances Agreement shall

obligate expenditures. To this end and subject to the authority entrusted to the authorized comptroller in pursuance of Articles 33 to 38 herebelcw, he shall issue the calls for bids, receive tenders, notify the results of adjudications and, according to the rules of the benefitting country, make provisions for the

signing of the contracts and estimates. The documents thus established shall be made known to the Principal Authorizing Officer of the Fund.

Article 30

In the exercise of Iiis functions, the local authorizing ofiiuer shall be conTjdtted to comply with the provisions of the Financial Regulation and in parti cular its Articles 16, 19, 20, 22, 22, 23, 24, 26, 27, 28, 29, 31 and 32?

Article 31

In the case where the Principal Authorising Officer of the Fund is aware of

delays in the development of the procedures relating to projects financed by the

Fund, and in particular in application of Articles 29 and 30 of this Regulation, he shall contact the local authorizing officer in order to remedy the situation.



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If works have been carried out and if, for one reason or another, a pro longed delay in the settlement, tw orcer to pay, cr the payment, as veil as effecting transfers, should give rise to difficulties which might jeopardize the full implementation of the contract, the Principal Authorizing Officer may take any useful measure to put an end to those difficulties, to remedy, where necessary, the financial consequences of the situation thu3 created and, more

generally, render possible the achievement of the projoct(s) under the best economic conditions. He shall make knovoi such measures to the local authorizing officer as soon as possible. If payments are thus ?rade directly to the bene ficiary of the contract by the Commission, the European Economic Community shall automatically enjoy the rights of that creditor vis-a-vis the local authorities?

Article 32

The local authorizing officer shall remain financially responsible until the transactions which have been entrusted to him, have been settled by the Com mission.

CHAPTER III - THE DELEGATED COHPTROLLSR /Ct'IfTROLEUR DELEGIER Article 33

The locati audit shall be assured by the delegated comptroller who receives the Commissions directives for the projects and programs entrusted to him and who has, in particular, the following duties:

a) The delegated comptroller shall assume the financial audit of the projects and programs entrusted to him. This audit shall be carried out in accordance with the provisions of Articles 34 to 37 of this Regulation, subject, as regards production subsidization programs and advances to the Stabilization Fluids to special provisions which may figure in agreements relating thereto.

The audit shall be carried out of the vouchers and on the spott The dele gated comptroller shall send his comments to the local authorizing officer.and report them to the Commission?

b) Within the framework of the instructions received from the Commission, the delegated comptroller shall also audit the technical execution of the projects and programs.

Article 34

The delegated comptroller shall ascertain that Article 28 hereabove relating to conditions of competition is applied. To this end, he shall receive from the local authorizing officer, for prior approval, the documents preparing the commitment of funds and, in particular, the -files of the calls for bids, the minutes on the evaluation of offers, draft contracts by direct agreement or draft estimates for works under public management. He shall attend the meetings at which the offers are evaluated as observer.

Article 35

Th*> contracts, estimates and supplementary agreements relating thereto, before being signed by the competent authorities, shall be submitted for initial



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ing by the delegated comptroller.

Article 36

During work performance the delegated comptroller shall verify, based on vouchers and on the spot, whether the realizations or performances comply with their description given in the financing agreements, contracts, estimates etc* He shall verify and initial the minutes on the provisional and final acceptance.

Article 37

In the exercise of his functions, the delegated comptroller shall be bound to comply with the provisions of the Financial Regulation and, in particular, with its Articles 21 and 30.

Article 38

In case of non-compliance with the provisions of this Regulation, of fault or serious negligence in the exercise of his functions, the delegated comptroller shall be held responsible to the Commission.

CHAPTER IV - THE DELEGATED DISBURSING AGENT

Article 39

In the exercise of his functions, the delegated disbursing agent referred to in Article 1 hereabove, shall be bound to comply with the provisions of the Financial R?gulation and, in particular, with its Articles 17, 18, 33* 34, 35 and 36.

Article 40

In case of mistakes, serious negligence or non-compliance with the rules in force, resulting in financial damage for the Community, the delegated dis bursing agent shall be held financially responsible under the conditions and terms laid down in the contract concluded between him and the Commission.

TITLE IV - FINAL PROVISIONS

Article 41

The Comndssion shall have the right to undertake, through its own agents or through duly authorized assignees, all audits or inspections in the. technical and financial field as well as in the field of accountancy.

Article 42

No legal act of any nature whatsoever may be hela against the Commission imless it bears the initials of the financial comptroller of the Fund or of the competent delegated comptroller.

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Article 43

The Principal Authorizing Gffiuo* of the Funds shall lay down the imple menting provisions to this Regulation.

This Regulation shall be binding in all its parts and directly applicable in each Member State



Documents

European Economic Community: Regulations of European Development Fund