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Cabinet of ministers of the republic of Latvia
9 October 2012Regulation No. 694
Riga(Protocol No. 56 )
Regulation on the Management of the European Economic Area Financial Mechanism and Norwegian Financial Mechanism 2009-2014
Issued according to Article 15, Clauses 1 and 2 of the Law on the Management of European Economic Area Financial Mechanism and Norwegian Financial Mechanism 2009-2014I. General Provisions
1. This Regulation states the procedure:
1.1. under which the authorities provision involved in the management of the European Economic Area Financial Mechanism and Norwegian Financial Mechanism (hereafter – the FMs) ensure the management ofFMs;
1.2. for planningof the funds in the State budgetfor implementation of the programmes co-financed by the FMs (hereafter – the programme) andopen call and the predefined projects (hereafter – the project) and performance of payments.
2. The functions of the Programme Operator (hereafter – the PO) shall be performed by:
2.1. The Ministry of Economics;
2.2. The Ministry of Education and Science;
2.3. The Ministry of Culture;
2.4. The Society Integration Foundation;
2.5. The Ministry of Justice;
2.6. The Ministry of Environmental Protection and Regional Development.
3. State Education Development Agency shall function as anAgency within the programme Scholarships and Norwegian-Latvian Research Support Fund and Scholarship Programme co-financed by FMs.
4. Investment and Development Agency of Latvia shall function as an Agencywithin the programme Green Industry Innovation co-financed by Norwegian Financial Mechanism (hereafter – the NFM).
5. The State Regional Development Agency shall function as an Agency within the programme Capacity Building and Institutional Cooperation between Latvian and Norwegian Public Entities, Local and Regional Authoritiesco-financed by NFM and within the programme Financial Mechanism (hereafter – the EEA FM) National Climate Policy co-financed by the EEA, except for the predefined project of the programme Capacity Building and Institutional Cooperation between Latvian and Norwegian Public Entities, Local and Regional Authorities, in which the State Regional Development Agencyshall act as a project partner.
6. The Ministry of the Interior shall act as a national programme partner within the programme Reform of Latvian Correctional Services and Police Detention Centres co-financed by NFM.
7. The Ministry of Welfareshall function as the responsible line ministry within the programme Global Fund for Decent Work and Tripartite Dialogue co-financed by NFM.
8. Costs incurred within the programme shall be eligible, if made starting from the date, when Norwegian Ministry of Foreign Affairs or European Economic Area Financial Mechanism Committee (hereafter – the donorstates) approve the relevant programme. Programme preparation costs shall not be eligible from the funds intended for programme implementation.
9. Costs incurred within the predefined project shall be eligible starting from the day, when the Focal Point(hereafter – the FP) informs the Financial Mechanism Office (hereafter – the FMO) on the PO’s positive assessment of the predefined project.
II. Approval and Modificationsof the Memorandum of Understanding, Programme, Programme Agreements
10. The FP in cooperation with the representatives of the donorstatesshall develop the Memorandum of Understanding on the implementation of the EEA FM 2009-2014, concluded between the Republic of Latvia and Iceland, the Principality of Liechtenstein and the Kingdom of Norway and the Memorandum of Understanding on the implementation of the NFM 2009-2014, concluded between the Republic of Latvia and the Kingdom of Norway (hereafter – the MoUs or MoU) and submit them to the Cabinet of Ministers under prescribed procedure.
11. After the signing of the MoU, the PO shall develop the programme proposal and submit it to the Cabinet of Ministers under prescribed procedure. Programme proposal shall include the summaries of the predefined projects.
12. After the programme proposal is supported by the Cabinet of Ministers for submission to the Financial Mechanism Committee, the FP shall submit the programme proposal for approval to the donorstates.
13. If the donorstates approve the programme proposalwith conditions or with modifications, the POshall ensure the fulfilment of the conditions.
14. If the donorstatesreject the programme proposal, the FP shall decide on one of the following solutions:
14.1. the PO shall develop new programme proposal and submit it to the Cabinet of Ministers. After the support of the programme proposal in the Cabinet of Ministers, the FPshall submit the programme proposal for approval to the donorstates. The PO and the FPshall ensure the development of the new programme proposal and its submission within 4months from the decision date on rejection of the programme proposal;
14.2. the FP in cooperation with thePO,within 4 months from the donorstates’ decision date, shalldecide on reallocation of funds planned for the rejected programme proposal to another programme, accordingly modifying the MoU.
15. After receipt of the donorstates’ decision on approval of the programme proposal, the FP within 5 business days shall inform thePO, the Agency, the CA (hereafter – the CA) and the Audit Authority (hereafter – the AA) on the received decision.
16. After receipt of the draft programme agreement from the donorstates, theFP, in cooperation with thePO, shall review and coordinate it with the donorstates. The FP shall ensure the conclusion of the programme agreement with Norwegian Ministry of Foreign Affairs or EEA Financial Mechanism Committee. The FP and the operator of the relevant programme areresponsible for implementation of the programme agreement:
16.1. Ministry of Economics for the programme “Green Industry Innovation”;
16.2. Ministry of Education and Science for the programme “Norwegian-Latvian Research Support Fund and Scholarship Programme”;
16.3. Ministry of Culture for the programme “Conservation and Revitalisation of Cultural and Natural Heritage”;
16.4. Society Integration Foundation for the programme “NGO fund”;
16.5. Ministry of Justice for the programme “Reform of the Latvian Correctional Services and Police Detention Centres”;
16.6. Ministry of Environment Protection and Regional Development for the programmes “National Climate Policy” and “Capacity-building and Institutional Cooperation between Beneficiary State and Norwegian Public Institutions, Local and Regional Authorities”.
17. The POmay propose modifications to the programme according to the procedures prescribed by the FMs’ management documents.
17.1. If the programme does not provide for the Cooperation Committee, the POshall submit proposals on the necessary modifications in the programme to theFP. The FP shall assess these modifications and harmonize them with the POor reject them within 15 business days from the receipt date.
17.2. If the programme provides for the Cooperation Committee, the POshall submit proposals on the necessary modifications in the programme to the FP within 10 business days before the Cooperation Committee’s meeting. The FP shall assess the above-mentioned modifications and submit to the Cooperation Committee its opinion on the support or rejection of the proposals. If the content of the programme modifications is changed in the meeting of the Cooperation Committee, the FP shall harmonize the modifications with the PO or reject them within 5 business days from the Cooperation Committee meeting date.
18. After the receipt of the donorstates’decision on the programme modifications, the FP within 5 business days shall inform thePO, the Agency, the CAand the AA on the decision.
III. Open Call of Project Applications, Assessment of the Predefined Projects, Contentof and Procedure for Conclusion of the Project contract
19. Open callfor the project applications (hereafter – the open call) shall be organised under the following procedure:
19.1. The POorthe Agencyshall launch the open callnot earlier than one month after coming into force of the procedure on determining the project applications’ assessment criteria and requirements for the project applicants;
19.2. The POor the Agencyshall set a deadline for submission of project applications which not earlier than in 2 months from the open calllaunch date;
19.3. The POorthe Agencyshall establish a separate Selection Committee for each programme;
19.4. The POorthe Agencyshall develop, approve and publish on their websitesthe procedure for the open call and assessment of project applications;
19.5. The POorthe Agencyshall assess project applications in line with the project applications’ selection criteria;
19.6. The POorthe Agencyshall inform the project applicant regarding the decision on approval, approval with condition or rejection of the project application within 5business days from the decision date.
20. Prior to the conclusion of the project contract,the POshall ensure the assessment of the predefined project according to the conditions of the programme and Clause 3 of Article 5.5 of the Regulation on introduction of the EEA Financial Mechanism in 2009-2014 (hereafter – Regulation on implementation of the EEA FM) or Clause 3 of Article 5.5 of the Regulation on implementation of the Norwegian Financial Mechanism in 2009-2014(hereafter – the Regulation on implementation of NFM).
21. The POor the Agency shall include in the decision on project application’s approval, in the opinion on fulfilment of conditions of this decision or in the opinion on positive assessment of the predefined project, reference to website addresswhere the template of the project contractand invitation for the project promoter to conclude the project contractwill be available.
22. The POorthe Agencyshall include in the project contractat least the following information:
22.1. reference to the programme agreement and, correspondingly, to the Regulation on implementation of the EEA FM or Regulation on implementation of NFM;
22.2. project title and subject of the project contract;
22.3. requisites of the PO or the Agency, national programme partner (if applicable) and the project promoter;
22.4. the total projectcosts, separating the approved maximum amountof FM co-financing and the State budget financing (hereafter–the programme expenses) (in euroand equivalent in Lats according to the exchange rate set by the Bank of Latvia) and the rate, as well as the national co-financing amount provided by project promoter(in euro and equivalent in Lats according to the exchange rate set by the Bank of Latvia) and the rate;
22.5. rights and obligations of the POPO or the Agency, national programme partner (if applicable) and the project promoter;
22.6. deadlineof fulfilment of the project contract contract;
22.7. eligible costs, conditions for eligibility of costs and the eligibility period of costs;
22.8. template of the approved project, including detailed project budget, setting aside also up to 5% of the total project budget for unforeseen cases (eligible, if provided for in the programme);
22.9. methodfor calculation of indirect costs (overheads) and the maximum amount of such costs (eligible, if provided for in the programme);
22.10. procedure for preparation and submission of the project reports, including payment claims (hereafter – project report);
22.11. term for the use of the advance payment, not exceeding 12 months as from the advance payment date , procedure for reporting on the used advance payment by the project promoter and conditions for recovery of the advance payment not used within the set term;
22.12. procedure for the disbursement of the project costs, if the project promoteris a private individual;
22.13. procedure for carrying out financial control, audit and other reviews, including the references that the project promoter shall be obliged to immediately provide the necessary information;
22.14. project publicity requirements, including the use of the FMs’ logo;
22.15. condition that the project promoter, when concluding contract on goods, services or construction within the project, shall be obliged to comply with the principle of sound economic practices, transparency and fair competition, as well as to ensure efficient use of the allocated funding;
22.16. conditions for procurements, if the planned contract price is below the contract prices’ thresholds stated in the normative acts on public procurementor the contract prices’ threshold stated within the project by the contracting authority, in order to ensure the compliance with requirements mentioned in Subclause 22.15 of this regulation;
22.17. conditions that the project promoters shall fulfil during the project implementation and after its completion in accordance with Subclause 2.1. of Annex I of the programme agreement (if applicable);
22.18. procedure for submission of notifications mentioned in Clause 29 of this regulation;
22.19. period of storage of the documents related to implementation of the project;
22.20. provisions of postponing and suspension of the payments, reduction of the amount and its disbursement;
22.21. term of validity of the project contract, as well as the procedure for modification and termination of the project and the project contract;
22.22. dispute resolution procedures;
22.23. reference to the partnership agreement or, if necessary, letters of intent;
22.24. provisions regarding intellectual property rights (applicable, if the programme provides for research activities);
22.25. reinforcement of obligations rights and sanctions (procedure for determination and calculation of the penalties) (applicable, if the project promoter is a legal entity or association of such persons registered in the Republic of Latvia).
23. After adoption of decision on project application approval or the opinion on the positive assessment of the predefined project, but prior to the conclusion of the project contract, the project promoter, thePO, the Agencyornational programme partner may adjust the information in the project application, if it is outdated, without modifying the substance of the project application. Adjustments shall be performed as follows:
23.1. if adjustments are initiated by the project promoter:
23.1.1. it shall notify on the necessary adjustments the PO or the Agency, with whom the project contract on the project implementation will be concluded;
23.1.2. the POorthe Agency within 10 business days from the receipt of the notification mentioned in Subclause 23.1.1 of this regulation shall adopt a decision on adjustmentof the project application and inform the project promoter thereon;
23.1.3. if the decision mentioned in Subclause 23.1.2 of this regulationis positive, the project promoter within 10 business days from the decision date mentioned in Subclause 23.1.2 of regulation shall submit the adjusted sections of the project application to the PO or the Agency for conclusion of the project contract;
23.2. if adjustments are initiated by the POorthe Agency:
23.2.1. it shall notify the project promoter on the necessary adjustments;
23.2.2. if theproject promoteragrees with the adjustments, it shall within 10 business days from the notificationdate mentioned in Subclause 23.2.1 of this regulations submit the adjusted sections of the project application to the PO or the Agency for conclusion of the project contract;
23.3. if adjustments are initiated by the national programme partner:
23.3.1. it shall notify the PO on the necessary adjustments;
23.3.2. the POshall within 10 business days from the notification date mentioned in Subclause 23.3.1 of this regulationadopt the decision on adjustment of the project application and inform the project promoter thereon;
23.3.3. if the project promoteragrees with the adjustments, it shall within 10 business days from the notification date mentioned in Subclause 23.3.2 of ths regulation submit the adjusted sections of the project application to the PO or the Agency for conclusion of the project contract.
24. If theproject promoteror national programme partner asks the PO or the Agency to adjust the contact information or payment requisites, thePOorthe Agencyshall take intoaccount such information, when drawing up theproject contract.
25. If theproject promoter, thePO, the Agencyor national programme partnerdoes not agree with adjustments of the project application mentioned in Clause 23 of this regulation, recall its proposal or agree upon other wording of the project application, the project contract shall not be concluded.
26. Project contract shall be concluded within 40 business days from the moment, when the project promoterreceives the decision or the opinion:
26.1. decision on approval of the project application;
26.2. opinion on fulfilment of the conditions, if any are included in the decision on project approval ;
26.3. opinion on positive assessment of the predefined project.
27. Upon request of the project promoter, the POorthe Agencymay extend the term for conclusion of the project contract mentioned in Clause 26 of this regulation by not more than 20 business days (unless stated otherwise by normative acts on the programme implementation), and shall inform the project promoter thereofwithin 3business days from the adoption of the decision on extension of the term for conclusion of the project contract. If theproject promoterfails to conclude the project contract within the term prescribed by Clause 26 of this regulation or by this Clause of this regulation, project contract with the project promoter shall not be concluded.
IV. Introduction of Modificationsof the Project Application and the Project
28. If after the conclusion of the project contract it is necessary to modify the project, the project promoterornationalprogramme partnershall submit the modification request to the PO orthe Agency, with whom the project contract is concluded.
29. If after the conclusion of the project contract the contact information or payment requisites of theproject promoter or national programme partner have changed, after the receipt of the notice the POorthe Agency shall attach this notice to the project contract.
30. If modifications of the project submitted by the project promoter do not refer to information mentioned in Clause 29 of this regulation, thePOorthe Agency, with whom the project contract is concluded (except for the case prescribed in Clause 34 of the regulation), shall, within25 business daysfrom the receipt date of the modification request, in cooperation with national programme partner (ifapplicable), assess the feasibility, justification and necessity of the submitted modifications for the achievement of project objective and the compliance of them with the conditions mentioned in open call regulations (if applicable) and shall:
30.1. introduce the corresponding modifications of the project and inform the project promoter and the national programme partner thereof;
30.2. adopt the decisionnot to introduce the modifications in the project and inform the project promoter and the national programme partner thereof, providing the justification for refusal or, alternatively, information on the necessary adjustments in the modification request as well as procedure and timeframe for repeated submission.
31. If the modifications mentioned in Clause 30 of this regulation are to be introduced in the predefined project and harmonized with the Cooperation Committee, thePOshall assess the modification request and harmonize it with the Cooperation Committee within 40 business days from the modification request date.