“Activecorruption” is a PIF offence. It means the action of a person who promises, offers or gives, directly or through an intermediary, an advantage of any kind to a public official for himself or for a third party for him to act or to refrain from acting in accordance with his duty or in the exercise of his functions in a way which damages or is likely to damage the Union's financial interests.
“Administrative arrangements” shall mean arrangements of a technical and/or operational nature concluded between authorities, which may in particular aim at facilitating the cooperation and the exchange of information between the parties thereto, and which do not create additional legal obligations. Within the meaning of Regulation 883/2013 the term “administrative arrangements” is used to describe the arrangements concluded by the European Anti-Fraud Office (OLAF). Administrative arrangements are often referred to as ACA’s (administrative cooperation agreements).
Source: Art. 2 (7) of Regulation 883/2013
“Administrative investigations” shall mean any inspection, check or other measure undertaken by the Office in accordance with Articles 3 and 4, with a view to achieving the objectives set out in Article 1 and to establishing, where necessary, the irregular nature of the activities under investigation; those investigations shall not affect the powers of the EPPO or of the competent authorities of Member States to initiate and conduct criminal proceedings;’;
The term “administrative ivnestigations” may be used to describe such investigations on national level also. Some of the Anti-Fraud Coordination Services (AFCOS) of the Member States are vested with powers to perform administrative investigations.
Source: Art. 2 (4) of Regulation 883/2013 as amended by Reg. 2020/2223
See also (all languages): Guidelines on Investigation Procedures for OLAF Staff
“Administrative measures” are the actions taken by the competent authorities to restore a situation of wrongful use of EU funds the way it was before the irregularity occurred. As a general rule the administrative measures are applied to any irregularity and shall involve withdrawal of the wrongly obtained advantage:
— by an obligation to pay or repay the amounts due or wrongly received,
— by the total or partial loss of the security provided in support of the request for an advantage granted or at the time of the receipt of an advance.
The administrative measures under Regulation 2988/95 shall not be regarded as penalties (sanctions).
If the administrative measures under Regulation 2988/95 aim to take care of restoring the situation as if the irregularity did not occur, the administrative penalties aim to sanction the perpetrator. Administrative penalties (sanctions) may be introduced in so far as they are necessary to ensure the proper application of EU law. They shall be effective, proportionate and dissuasive so that they provide adequate protection for the EU’s financial interests. The administrative measures under Regulation 2988/95 shall not be regarded as penalties (sanctions) and may be applied together with the administrative penalties.
Examples of administrative penalties (sanctions) applied in cases of intentional irregularities or irregularities caused by negligence:
(a) payment of an administrative fine;
(b) payment of an amount greater than the amounts wrongly received or evaded, plus interest where appropriate; this additional sum shall be determined in accordance with a percentage to be set in the specific rules, and may not exceed the level strictly necessary to constitute a deterrent;
(c) total or partial removal of an advantage granted by Union rules, even if the operator wrongly benefited from only a part of that advantage;
(d) exclusion from, or withdrawal of, the advantage for a period subsequent to that of the irregularity;
(e) temporary withdrawal of the approval or recognition necessary for participation in a Community aid scheme;
(f) the loss of a security or deposit provided for the purpose of complying with the conditions laid down by rules or the replenishment of the amount of a security wrongly released;
(g) other penalties of a purely economic type, equivalent in nature and scope, provided for in the sectoral rules adopted by the Council in the light of the specific requirements of the sectors concerned and in compliance with the implementing powers conferred on the Commission by the Council.
AFCOS abbreviation stands for Anti-Fraud Coordination Service.
According to Article 12a of Regulation 883/2013 as amended by Regulation 2020/2223 each Member State shall, for the purposes of this Regulation, designate a service (the “anti-fraud coordination service”) to facilitate effective cooperation and exchange of information, including information of an operational nature, with the Office. Where appropriate, in accordance with national law, the anti-fraud coordination service may be regarded as a competent authority for the purposes of this Regulation.
Source: Art. 12a, of Regulation 883/2013 as amended by Regulation 2020/2223
The theory of the Anti-Fraud Cycle aims to explain the necessary actions of the authorities in the fight against fraud with EU funds. The idea is that an effective anti-fraud policy needs to take into account four essential pillars:
1) Fraud prevention,
2) Fraud detection,
3) Investigation and prosecution and
4) Recovery and sanctions.
These four pillars are closely linked in the “antifraud cycle” and they are closely interconnected. For example, if a Member State has strong internal fraud prevention policy, the overall number of fraud cases would be lower. A second example would be that if the Managing authorities have strong controls in place, they may find more cases of irregularities, suspected fraud cases or fraud cases, thus engaging the next phases of the antifraud cycle – investigation and prosecution and recovery and sanctions.
An Anti-Fraud Policy is a policy of the competent authorities in the fight against fraud and all other illegal activity affecting the financial interests of the European Union. This policy may be engaged on EU level, on national level, on managing authority’s level etc. It comprises the actions which the relevant authorities are envisaging to tackle fraud.
Anti-fraud policy of the Managing Authorities of EU funds
According to the Guidance of the European Commission on Fraud Risk Assessment and Effective and proportionate Anti-Fraud Measures, many organizations use an anti-fraud policy to communicate their determination to combat and address fraud. Within any such policy, which should be simple and focused, the following topics should be covered:
• Strategies for the development of an anti-fraud culture;
• Allocation of responsibilities for tackling fraud;
• Reporting mechanisms for suspicions of fraud;
• Cooperation between the different actors.
ARACHNE is an integrated IT tool for data mining and data enrichment developed by the European Commission. Its objective is to support managing authorities in their administrative controls and management checks in the area of ESI funds.
ARACHNE can increase the efficiency of projects selection, management verifications and further strengthen fraud identification, prevention and detection.
Source: Arachne’s Charter
Contact the ARACHNE team:
Audit in the general context is related to independent examination of financial information of any entity with a view to express an opinion thereon. The audit of EU funds is performed by a designated Audit Authority. The Audit authority shall ensure the proper functioning of the management and control system of the operational programme and on an appropriate sample of operations on the basis of the declared expenditure. Member States must assure the Commission that the Funds are being spent effectively and in accordance with the Regulations
An audit authority must be designated for each operational programme. This authority provides the Commission with an audit strategy and an annual audit opinion and annual control report, taking into account issues identified during audits carried out during the previous 12 months.
The Commission also has the right to carry out on-the-spot audits (at a minimum 10 days' notice) or may request a Member State to audit specific programmes or projects. The principle of proportionality is applied so that much smaller programmes do not require the same level of administration as far larger programmes.
Audit of operations shall be carried out in respect of each accounting year on a sample of operations selected by a method established or approved by the audit authority in accordance with Article 28 of Regulation 480/2014. Audits shall also verify that the public contribution has been paid to the beneficiary in accordance with Article 132(1) of Regulation (EU) No 1303/2013. Audits of operations shall, where applicable, include on-the-spot verification of the physical implementation of the operation. Audits of operations shall verify the accuracy and completeness of the corresponding expenditure recorded by the certifying authority in its accounting system and the reconciliation of the audit trail at all levels.
The Systemaudit is related to the evaluation of the proper functioning of the management and control system of the programme on the basis on a set of requirements (key requirements).
The assessment of the key requirements for the management and control systems with regard to their functioning may is to be evaluated as follows:
Source: Art. 127 of the CPR Regulation 1303/2013
Source: Art. 27 of Regulation 480/2014
‘Award procedure’ means a procurement procedure, a grant award procedure, a contest for prizes, or a procedure for the selection of experts or persons or entities implementing the budget pursuant to point (c) of the first subparagraph of Article 62(1) of the Financial Regulation 2018/1046.
Source: Art. 2, par. 3 of the Financial Regulation 2018/1046