FAQ on Eligibility
- What is meant by eligibility ?
- What are the documents that govern the concept of eligibility ?
- What are the rules for the eligibility of costs ?
- What is the eligibility period ?
- Are there specific rules for the eligibility of the expenditures ?
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1. What is meant by eligibility ?
In general, the word “eligibility” expresses the capability to meet conditions for the fulfilment of further actions.
In the CADSES programme the concept of eligibility is applied to activities, costs and expenditures; whether these are eligibile for the fulfilment of the objectives set by the Commission in the field of territorial development and for ERDF funding.
An activity is eligible if it fulfils the criteria set in the programme documents such as the CIP and the Programme Complement, the (EC) regulation 1260/99 on the Structural Funds, the INTERREG guidelines. Eligibility in this sense means that the activity matches the criteria set in these documents and helps fulfil the goals in terms of spatial development set by the Commission.
The implementation of such activities originates costs that are eligible if carried out according to the budgetary framework foreseen by the programme, by the National and EU rules regarding the eligibility of costs (Reg. 448/2004).
Also the expenditures, in order to qualify for the ERDF reimbursement, must match the criteria set in the reg. 448/2004 and the National provisions that govern the carrying out of expenditures.
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2. What are the documents that govern the concept of eligibility ?
In order to be eligible for the programme and for ERDF funding, the project activities and the related costs must fulfil conditions set in European and national regulations. These are grouped according to the content into the so-called four levels of eligibility:
First level: Council Regulation (EC) 1260/99 laying down general provision on Structural Funds (eligibility in time, eligible activities according to the Structural funds framework);
Second level: INTERREG guidelines “Communication from the Commission to the member states laying down guidelines for the initiative INTERREG III” of 28.04.2000 and of 02.09.2004;
Third level: National regulations governing public procurement and the possibility to purchase goods and services in the project’s framework;
Fourth level: eligibility of the expenditure as stipulated by the Commission Regulation (EC) 448/2004448/2004
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3. What are the rules for the eligibility of costs ?
As we said, the rules are set in the regulations listed above. A cost is eligible if it is related with an activity performed according to the programme’s guidelines and the Community’s regulatory framework; also the cost and the related expenditure must follow other eligibility criteria that regulate its correctness also from the accounting poiunt of view, the fact that the cost borne is not ill-considered and that it responds to average market values. Moreover, the goods and service purchased must respond to objective criteria of “value for money”, i.e. make sure that the money is well spent and does not give way
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4. What is the eligibility period ?
Project costs are eligible if incurred during the lifetime of the project, i.e. between the start date and the end date stated in the approved Application Form. Nevertheless, preparatory costs (see relevant section under FAQ) are eligible also before the official starting date of the project. In any case, costs must have arisen after March 12th 2001 (official starting date of the programme INTERREG IIIB CADSES).
Further expenses not included within the ending date will not be considered as eligible. This means that all payments related to the eligible expenditure have to be carried out within this date. Nonetheless, the Managing Authority allows that the financial account and the payment request with related annexes could be wound up and submitted at the latest within the 6 months following the official ending date.
If this delay has consequences on the n+2 risk, the Lead Partner would be considered as responsible in case of loss of funds. The project could have its funds cut, considering that the disbursement of ERDF funds is subject to the condition that the European Commission makes funds available.
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5. Are there specific rules for the eligibility of the expenditures ?
The eligibility of project costs for Structural Funds co-financing is regulated in the Commission Regulation (EC) No. 448/2004 of 10 March 2004, laying down rules for the implementation of Council Regulation (EC) No 1260/99 as regards eligibility of expenditure of operations co-financed by the Structural Funds.
These rules should be carefully taken into account when potential applicants develop a project idea and draw up the corresponding budget.
The eligibility rules described in the Commission Regulation (EC) No. 448/2004 of 10 March 2004 cover the following topics:
1. Expenditure actually paid out
2. Accounting treatment of receipts
3. Financial and other charges and legal expenses
4. Purchase of second-hand equipment
5. Purchase of land 6. Purchase of real estate
7. VAT
8. Venture capital and loan funds
9. Guarantee funds
10. Leasing
11. Costs incurred in managing and implementing the Structural Funds
12. Eligibility of operations depending on the location.
These categories may not cover all the possible expenditures that one incurs in the implementation of a project. Necessarily, it is impossible to foresee in advance what type of costs will be borne by the CADSES projects. The variety of actors and the many different goals to achieve imply also many actions, ranging from the study of the effects of a flood to the purchase of a pilot device that can gauge the intensity of a quake. Therefore the basic criterium is: provided the project is eligible and that it helps reach the objectives of INTERREG in terms of development, then the activities that compose the projects are eligible themselves, and the related expenditures are also eligible. It is a matter of “common sense” and of coherence. Of course this rule must guarantee the repect of the regulations listed in the paragraph 2.