2.5

2.6

2.7

The Organisation shall notify the Contracting Authority and the European Commission
without delay of any substantial change in the rules, procedures and systems applied in the
implementation of the Action. This obligation concerns in particular (1) substantial changes
affecting the pillar assessment undergone by the Organisation or (ii) those that may affect the
conditions for eligibility provided for in the applicable legal instruments of the EU. The
Parties shall use their best efforts to resolve amicably any issues resulting from such changes.
The Contracting Authority reserves the right to adopt or require additional measures in
response to such changes. In the event an agreement on such measures or other solutions
cannot be reached between the Parties, either Party may terminate the Agreement in
accordance with Article 13.3.

The Organisation shall promote the respect of human rights and respect applicable
environmental legislation including multilateral environmental agreements, as well as
internationally agreed core labour standards. The Organisation shall not support activities
that contribute to money laundering, terrorism financing, tax avoidance, tax fraud or tax
evasion.

Where the European Commission is not the Contracting Authority, it shall not be a party to
this Agreement, with the consequence that rıghts and obligations arc conferred upon it only
where explicitly stated. This is without prejudice to the European Commission's role in
promoting a consistent interpretation of the terms of this Agreement.

Article 3: Obligations regarding information and reporting

General issues

3.1

3.2

3.3

3.4

3.5

3.6

The Organisation shall provide the Contracting Authority with full information on the
implementation of the Action. To that end, the Organisation shall include in Annex I a work
plan at least for the first year of the Implementation Period (or the whole Implementation
Period where it is less than one year). The Organisation shall submit to the Contracting
Authority progress report(s) and a final report in accordance with the provisions below.
These reports shall consist of a narrative part and a financial part.

Every report, whether progress or final, shall provide a complete account of all relevant
aspects of the implementation of the Action for the period covered. The report shall describe
the implementation of the Action according to the activities envisaged in Annex I as well as
the degree of achievement of its Results (Outcomes or Outputs) as measured by
corresponding Indicators. The report shall be drafted in such a way as to allow monitoring of
the objective(s), the means envisaged and employed. The level of detail in any report shall
match that of Annexes land IH.

Where the overall action of the Organisation lasts longer than the Implementation Period of
this Agreement, the Contracting Authority may request - in addition to the final reports to be
submitted pursuant to Article 3.8 - the final reports of the overall action, once available.

Any alternative or additional reporting requirement shall be set out in the Special Conditions.

The Contracting Authority may request additional information at any time, providing the
reasons for that request. Subject to the Organisation’s Regulations and Rules, such
information shall be supplied within thirty (30) days of receipt of the request. The
Organisation may submit a duly motivated request to extend the 30-day deadline.

The Organisation shall notify the Contracting Authority without delay of any circumstances
likely to adversely affect the implementation and management of the Action, or to delay or
Jeopardise the performance of the activities.

Content of the reports

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Annex II - General Conditions Page 5

3.7 The progress report(s) shall relate directly to this Agreement and shall at least include:

2)
b)

8)

h)
i)

summary and context ofthe Action;

actual Results: an updated table based on a logical framework matrix including reporting
of Results achieved by the Action (Outcomes or Outputs) as measured by their
corresponding Indicators, agreed baselines and targets, and relevant data sources;

information on the activities directly related to the Action as described in Annex I and
carried out during the reporting period;

information on the difficulties encountered and measures taken to overcome problems
and eventual changes introduced;

information on the implementation of the Visibility and Communication Plan (Annex
VI) and any additional measures taken to identify the EU as source of financing;

a breakdown of the total costs, following the structure set out in Annex III, incurred
from the beginning of the Action as well as the legal commitments entered into by the
Organisation during the reporting period;

a summary of controls carried out and available final audit reports in line with the
Organisation’s policy on disclosure of such controls and audit reports. Where errors and
weaknesses in systems were identified, an analysis of their nature and extent, as well as
information on corrective measures taken or planned, shall also be provided;

where applicable, a request for payment;

work plan and budget forecast for the next reporting period.

3.8 The final report shall cover the entire Implementation Period and include:

a)
b)

c)

d)

e)

8)

all the information requested in Article 3.7 a) to h);
a summary of the Action's receipts, payments received and of the eligible costs incurred;

where applicable, an overview of any funds unduly paid or incorrectly used which the
Organisation could or could not recover itself;

the exact link to the webpage where, according to Article 22.1, information on Grant
Beneficiaries and Contractors is available;

if relevant, details of transfers of equipment, vchicles and remaining major supplics
mentioned in Article 9;

where the Action is a Multi-Donor Action and the EU Contribution is not earmarked, a
confirmation from the Organisation that an amount corresponding to that paid by the
Contracting Authority has been used in accordance with the obligations laid down in
this Agreement and that costs that were not eligible for the EU Contribution have been
covered by other donors' contributions;

where applicable, a request for payment.

3.9 The Organisation shall submit a report for every reporting period as specified in the Special
Conditions starting from the commencement of the Implementation Period, unless otherwise
specified in the Special Conditions', Reporting, narrative as well as financial, shall cover the
whole Action, regardless of whether this Action is entirely or partly financed by the EU
Contribution. Progress reports shall be submitted within sixty (60) days after the period
covered by such report. The final report shall be submitted, at the latest, six (6) months after
the end of the Implementation Period.

Management declaration

3.10 Every progress and final report shall be accompanied by a management declaration in
accordance with the template included in Annex VI, unless Article 1.5 of the Special

 

! By default, the reporting period is every 12 months as from the commencement of the Implementation Period.

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Annex IT - General Conditions Page 6

Conditions states that an annual management declaration shall be sent to the European
Commission headquarters, separately from the reports provided under this Agreement.

Audit or control opinion for organisations other than International Organisations/Member
State Organisations

3.11

3.12

In case the Organisation is neither an International Organisation, nor a Member State
Organisation, the Organisation shall provide an audit or control opinion in accordance with
internationally accepted audit standards, establishing whether the accounts give a truc and
fair view, whether the control systems in place function properly, and whether the underlying
transactions are managed in accordance with the provisions of this Agreement. The opinion
shall also state whether the audit work puts in doubt the assertions made in the management
declaration mentioned above.

Such audit or control opinion shall be provided up to one (1) month following the
management declaration sent with every progress or final report, unless Article 1.5 of the
Special Conditions states that the management declaration and the audit or control opinion
shall be sent annually to the European Commission headquarters separately from the reports
provided under this Agreement.

Currency for reporting

3.13

3.14

The reports shall be submitted in the Currency of the Agreement as specified in Article 3 of
the Special Conditions.

The Organisation shall convert legal commitments, the Action’s receipts and costs incurred
in currencies other than the accounting currency of the Organisation according to its usual
accounting practices.

Failure to comply with reporting obligations

3.15

If the Organisation is unable to present a progress or final report, together with the
accompanying documents, by the deadline set out in Article 3.9, the Organisation shall
inform the Contracting Authority in writing of the reasons. The Organisation shall also
provide a summary of the state of progress ofthe Action and, where applicable, a provisional
work plan for the next period. If the Organisation fails to comply with this obligation for two
(2) months, following the deadline set out in Article 3.9, the Contracting Authority may
terminate the Agreement in accordance with Article 13, refuse to pay any outstanding
amount and recover any amount unduly paid.

Article 4: Liability towards third parties

4.1

42

4.3

The European Commission shall not, under any circumstances or for any reason whatsoever,
be held liable for damage or injury sustained by the staff or property of the Organisation
while the Action is being carried out, or as a consequence of the Action. The Europcan
Commission shall not therefore accept any claim for compensation or increase in payment in
connection with such damage or injury.

The European Commission shall not, under any circumstances or for any rcason whatsocver,
be held liable towards third parties, including liability for damage or injury of any kind
sustained by them in respect of or arising out ofthe implementation ofthe Action.

The Organisation shall discharge the European Commission of all liability associated with
any claim or action brought as a result of an infringement of the Organisation's Regulations
and Rules committed by the Organisation or Organisation's employees or individuals for
whom those employees are responsible, or as a result ofa violation of a third party's rights in
the context of the implementation of the Action.

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Annex II - General Conditions Page 7

Article 5: Conflict of interests

5.1

52

The Organisation shall refrain, in accordance with its Regulations and Rules, from any action
which may give rise to a conflict of interests.

A conflict of interest shall be deemed to arıse where the impartial and objective exercise of
the functions of any person implementing the Agreement is compromised.

Article 6: Confidentiality

6.1

6.2

6.3

6.4

The Contracting Authority and the Organisation shall both preserve the confidentiality of any
document, information or other material directly related to the implementation of the Action
that is communicated as confidential. The confidential nature of a document shall not prevent
it from being communicated to a third party on a confidential basis when the rules binding
the Parties, or the European Commission when it is not the Contracting Authority, so require.
In no case can disclosure put in jeopardy the Parties’ privileges and immunities or the safety
and security of the Parties’ staff, Contractors, Grant Beneficiaries or the Final Beneficiaries
ofthe Action.

The Parties shall obtain each other’s prior written consent before publicly disclosing such
confidential information unless:

a) the communicating Party agrees in writing to release the other Party from the carlier
confidentiality obligations; or

b) the confidential information becomes public through other means than in breach of the
confidentiality obligation by (he Party bound by that obligalion; or

c) the disclosure of confidential information is required by law or by Regulations and Rules
established in accordance with the basic constitutive document of any of the Parties.

The Parties shall remain bound by confidentiality for five (5) years after the End Date of the
Agreement, or longer as specified by the communicating Party at the time of communication.

Where the European Commission is not the Contracting Authority, it shall nonetheless have
access to all documents communicated to the Contracting Authority, and shall maintain the
same level of confidentiality.

Article 7: Data Protection

The Organisation shall ensure an appropriate protection of personal data in accordance with
its applicable Rules and Procedures. Personal data shall be:

—  processed lawfully, fairly and in a transparent manner in relation to the data subject;

—  collected for specified, explicit and legitimate purposes and not further processed in a
manncr that is incompatible with thosc purposes;

— adequate, relevant and limited to what is necessary in relation to the purposes for which
they are processed;

— accurate and, where necessary, kept up to date;

— kept in a form which permits identification of data subjects for no longer than is
necessary for the purposes for which the personal data are processed; and

—  processed in a manner that ensures appropriate security of the personal data.

Article 8: Communication and visibility

8.1

8.2

The Organisation shall implement the Communication and Visibility Plan detailed in
Annex VI.

Unless the European Commission requests or agrees otherwise, the Organisation shall take
all appropriate measures to publicise the fact that the Action has received funding from the
EU. Information given to the press and to the Final Beneficiaries, as well as all related

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Annex II - General Conditions Page 8

8.3

8.4

8.5

8.6

8.7

publicity material, official notices, reports and publications shall acknowledge that the
Action was carried out "with funding by the European Union" and shall display the EU logo
(twelve yellow stars on a blue background) in an appropriate way. Publications by the
Organisation perlaining to the Action, in whatever form and whatever medium, including the
internet, shall carry the following disclaimer: "This document was produced with (he
financial assistance of the European Union. The views expressed herein can in no way be
taken to reflect the official opinion ofthe European Union.” Such measures shall be carried
out in accordance with the Communication and Visibility Requirements for EU External
Action? published by the European Commission, or with any other guidelines agreed
between the European Commission and the Organisation.

If, during the implementation of the Action, equipment, vehicles or major supplies are
purchased using the EU Contribution, the Organisation shall display appropriate
acknowledgement on such vehicles, equipment or major supplies, including the display of
the EU logo (twelve yellow stars on a blue background). Where such display could
jeopardise the Organisation’s privileges and immunities or the safety of the Organisation’s
staff or of the Final Beneficiaries, the Organisation shall propose appropriate alternative
arrangements. The acknowledgement and the EU logo shall be of such a size and prominence
as to be clearly visible in a manner that shall not create any confusion regarding the
identification of the Action as an activity of the Organisation, nor the ownership of the
equipment, vchicles or major supplies by the Organisation.

If, pursuant to Article 9.5, the equipment, vehicles or remaining major supplies purchased
with the EU Contribution have not been transferred to the local authorities, local Grant
Beneficiaries or Final Beneficiaries when submitting the final report, the visibility
requirements as regards this equipment, vchicles or major supplies (in particular display of
the EU logo) shall continue to apply between submission of the final report and the end of
the overall action, if the latter is longer. Where the Organisation retains ownership in
accordance with Article 9.6, the visibility requirements shall continue to apply as long as the
relevant equipment, vehicles or remaining major supplies are used by the Organisation.

Unless otherwise provided in the Special Conditions, if disclosure risks threatening the
Organisation’s safety or harming its interests, the European Commission and the Contracting
Authority (if other than the European Commission) may publish in any form and medium,
including on its internet sites, the name and address of the Organisation, the purpose and
amount of the EU Contribution.

The Organisation shall ensure that reports, publications, press releases and updates relevant
to the Action are communicated to the addresses stated in the Special Conditions upon their
issuance.

The Parties will consult immediately and endeavour to remedy any detected shortcomings in
implementing the visibility requirements set out in this Article. This is without prejudice to
measures the Contracting Authority may take in case of substantial breach of an obligation.

Article 9: Right to use results and transfer of equipment

Right to use

9.1

Ownership of the resulis of the Action shall not vest in the Contracting Authority. Subject to
Article 6, the Organisation shall grant, and shall act to ensure that any third party concerned
grants the Contracting Authority (and the European Commission where it is not the
Contracting Authority) the right to use free of charge the results of the Action, including the
reports and other documents relating to it, which are subject to industrial or intellectual
property rights.

° Communication and Visibility in EU-financed external actions - Requirements for implementing partners (Projects), available at:
hups’//ee.europa.eweuroperid/sitesideveo’iles/icommunigation-visihilüy-requiremenis-2018_en.pdl'

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Annex II - General Conditions Page 9

92

Where the results mentioned in Article 9.1 include pre-existing rights and the Organisation
cannot warrant the Contracting Authority (and the European Commission where it is not the
Contracting Authority) the right to use such results, the Organisation shall inform in writing
the Contracting Authority (and the European Commission, where it is not the Contracting
Authority) accordingly.

Transfer

9.3

9.4

9.5

9.6

The equipment, vehicles and remaining major supplies purchased with the EU Contribution
shall be transferred to or remain with local authorities, local Grant Beneficiaries or Final
Beneficiaries, at the latest when submitting the final report.

The documentary proof of those transfers shall not be presented with the final reports, but
shall be kept for verification for the duration and along with the documents mentioned in
Article 16.2.

By way of derogation from Article 9.3, the equipment, vehicles and remaining major
supplies purchased with the EU Contribution in the framework of actions which continue
after the end of the Implementation Period may be transferred at the end ofthe overall action.
The Organisation shall use the equipment, vehicles and remaining major supplies for the
benefit of the Final Beneficiaries. The Organisation shall inform the Contracting Authority
on the end use ofthe equipment, vehicles and remaining major supplies in the final report.

In the event that there arc no local authorities, local Grant Beneficiaries or Final
Beneficiaries to whom the equipment, vehicles and remaining major supplies could be
transferred, the Organisation may transfer them to another action funded by the EU or -
exceptionally - retain ownership of the equipment, vehicles and remaining major supplies at
the end of the Action or the overall action. In such cases, it shall submit a justified written
request with an inventory listing ofthe items concerned and a proposal concerning their use
in due course and - at the latest — together with the submission of the final report. In no event
may the end use jeopardize the sustainability of the Action.

Article 10: Monitoring and evaluation of the Action

10.1

10.2

Keeping in mind the commitment of the Parties to the effective and efficient operation of the
Agreement, the Organisation shall invite representatives of the European Commission and
the Contracting Authority (if other than the European Commission) to participate at their
own costs to the main monitoring missions and evaluation exereises related to the
performance of the Action. Participation in evaluation exercises should be ensured by
requesting comments from the European Commission and the Contracting Authority on the
terms of reference before the exercise takes place, and on the different deliverables related to
an evaluation exercise prior to their final approval (as a minimum, on the final report). The
Organisation shall send all monitoring and evaluation reports relating to the Action to the
European Commission and the Contracting Authority once issued, subject to confidentiality.

Article 10.1 is without prejudice to any monitoring mission or evaluation exercise, which the
European Commission as a donor, or the Contracting Authority, at their own costs, may wish
to perform. Monitoring and evaluation missions by representatives of the European
Commission or the Contracting Authority shall be planned ahcad and completed in a
collaborative manner between the staff of the Organisation and the European Commission's
(or Contracting Authority’s) representatives, keeping in mind the commitment of the Parties
to the effective and efficient operation of the Agreement. The European Commission (or the
Contracting Authority) and the Organisation shall agree on procedural matters in advance.
The European Commission (or the Contracting Authority) shall make available to the
Organisation the terms of reference of the evaluation exereise before it takes place, as well as
the different deliverables (as a minimum, the draft final report) for comments prior to final
issuance. The European Commission (or the Contracting Authority) shall send the final
monitoring and evaluation report to the Organisation once issued.

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10.3

10.4

In line with the spirit of partnership, the Organisation and the European Commission (and the
Contracting Authority, if applicable), may also carry out joint monitoring and/or evaluation.
Such arrangements will be discussed and agreed in due time, planned ahead and completed
in a collaborative manner.

Representatives of the relevant partner country may, whenever possible, be invited to
participate at their own costs in the main monitoring missions and evaluation exercises,
unless such participation would be detrimental to the objectives ofthe Action or threaten the
safety or harm the interests of Partners, Grant Beneficiaries or Final Beneficiaries.

Article 11: Amendment to the Agreement

11.1

11.2

11.3

11.4

11.5

11.6

11.7

Without prejudice to Articles 11.3 to 11.7, any amendment to this Agreement, including its
annexes, shall be set out in writing in an addendum signed by both Parties. This Agreement
can only be amended before the End Date.

The requesting Party shall request in writing any amendment thirty (30) days before the
amendment is intended to enter into force and no later than thirty (30) days before the End
Date, unless there are special circumstances, duly demonstrated by it, and accepted by the
other Party. The other Party shall notify its decision regarding the amendment proposed in
due time and in any case no later than thirty (30) days after the date when the amendment
request was received.

By way of derogation from Articles I1.1 and 11.2, where an amendment to Annex I and/or
Annex III does not affect the main purpose of the Action, such as its objectives, strategy and
priority areas, and the financial impact is limited to a transfer within a single budget heading,
including cancellation or introduction of an item, or a transfer between budget headings
involving a variation (as the case may be in cumulative terms) of 25 % or less of the amount
originally entered (or as amended by a written addendum) in relation to each concerned
heading, the Organisation may unilaterally amend Annex I and/or Annex III and shall inform
the Contracting Authority accordingly in writing, at the latest in the next report.

The method described in Article 11.3 shall be used neither to amend the contingency reserve,
the rate for remuneration, nor the agreed methodology or fixed amounts/rates of simplified
cost options,

The Organisation may, in agreement with the Contracting Authority, change Outputs, the
Indicators and their related targets, baselines and sources of verification described in Annex ]
and in the logical framework if the change does not affect the main purpose of the Action,
without the need for a formal addendum to the Agreement.

The Organisation may, in agreement with the European Commission, amend Annex VI
without the need for a formal addendum to the Agreement.

Changes of address and of bank account shall be notified in writing to the Contracting
Authority. Where applicable, changes of bank account must be specified in the request for
payment, using the financial identification form attached as Annex IV.

Article 12: Suspension

Suspension of the time limit for payment

12.1

The Contracting Authority may suspend the time limit for payment following a single
payment request by notifying the Organisation that either:

a) the amount is not due; or

b) the appropriate supporting documents have not been provided and therefore the
Contracting Authority needs to request clarifications, modifications or additional
information to the narrative or financial reports. Such clarifications or additional
information may notably be requested by the Contracting Authority if it has doubts about

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12.2

compliance by the Organisation with its obligations in the implementation of the Action;
or

c) credible information has come to the notice of the Contracting Authority that puts in
doubt the eligibility ofthe reported expenditure; or

d) credible information has come to the notice of the Contracting Authority that indicates a
significant deficieney in the functioning of the Internal Control System of the
Organisation or that the expenditure reported by the Organisation is linked to a serious
irregularity and has not been corrected. In this case, the Contracting Authority may
suspend the payment deadline if it is necessary to prevent significant damage to the EU's
financial interests.

In the situations listed in Article 12.1, the Contracting Authority shall notify the Organisation
as soon as possible, and in any case within thirty (30) days from the date on which the
payment request was received, of the reasons for the suspension, specifying - where
applicable - the additional information required. Suspension shall take effect on the date
when the Contracting Authority sends the notification stating the reasons for the suspension.
The remaining payment period shall start to run again from the date on which the requested
information or revised documents are received or the necessary further checks are carried
out. If the requested information or documents are not provided within the deadline fixed in
the notification or are incomplete, payment may be made on the basis of the partial
information available.

Suspension of the Agreement by the Contracting Authority

12.3

12.4

The Contracting Authority may suspend the implementation of the Agreement, fully or
partly, if:

a) the Contracting Authority has proof that irregularities, fraud or breach of substantial
obligations have been committed by the Organisation in the procedure of its selection, in
its pillar assessment or in the implementation of the Action;

b) the Contracting Authority has proof that irregularities, fraud or breach of obligations have
occurred which call into question the reliability or effectiveness of the Organisation's
Internal Control System or the legality and regularity of the underlying transactions;

c) the Contracting Authority has proof that the Organisation has committed irregularities,
fraud or breaches of obligations under other agreements funded by EU funds provided
that those irregularities, fraud or breaches of obligations have a material impact on this
Agreement.

Before suspension, the Contracting Authority shall formally notify the Organisation of its
intention to suspend, inviting the Organisation to make observations within ten (10) days
from the receipt of the notification. If the Organisation does not submit observations, or if -
after examination of the observations submitted by the Organisation - the Contracting
Authority decides to pursue the suspension, the Contracting Authority may suspend all or
part of the implementation of this Agreement serving seven (7) days’ prior notice. In case of
suspension of part of the implementation of the Agreement, upon request of the
Organisation, the Parties shall enter into discussions in order to find the arrangements
necessary to continue Ihe part of the implementation that is not suspended. Any expenditures
or costs incurred by the Organisation during the suspension and related to the part of the
Agreement suspended shall not be reimbursed, nor be covered by the Contracting Authority.
Following suspension of the implementation of the Agreement, the Contracting Authority
may terminate the Agreement in accordance with Article 13.2, recover amounts unduly paid
and/or, in agreement with the Organisation, resume implementation of the Agreement. In the
latter case, the Parties will amend the Agreement where necessary.

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Suspension for exceptional circumstances

12.5

12.6

12.7

12.8

The Organisation may decide to suspend the implementation of all or part of the Action if
exceptional or unforeseen circumstances beyond the control of the Organisation make such
implementation impossible or excessively difficult, such as in cases of Force Majeure. The
Organisation shall inform the Contracting Authority immediately and provide all the
necessary details, including the measures taken to minimise any possible damage, and the
foreseeable effect and date of resumption.

The Contracting Authority may also notify the Organisation of the suspension of the
implementation ofthe Agreement if exceptional circumstances so require, in particular:

a) when a relevant EU Decision identifying a violation of human rights has been adopted; or

b) in cascs such as crisis entailing a change of EU policy.

Neither of the Parties shall be held liable for breach of its obligations under ihe Agreement if
Force Majeure or exceptional circumstances as set forth under Articles 12.5 and 12.6 prevent
it from fulfilling said obligations, and provided it takes any measures to minimise any
possible damage.

In the situations listed in Articles 12.5 and 12.6, the Parties shall minimise the duration of the
suspension and shall resume implementation once the conditions allow. During the
suspension period, the Organisation shall be entitled to the reimbursement of the minimum
costs, including new legal commitments, necessary for a possible resumption of the
implementation of the Agreement or of the Action. The Parties shall agree on such costs,
including the reimbursement of legal commitments entered into for implementing the Action
before the notification of the suspension was received which the Organisation cannot
reasonably suspend, reallocate or terminate on legal grounds. This is without prejudice to any
amendments to the Agreement that may be necessary to adapt the Action to the new
implementing conditions, including, if possible, the extension of the Implementation Period
or to the termination ofthe Agreement in accordance with Article 13.3. In case of suspension
due to Force Majeure or ifthe Action is a Multi-Donor Action, the Implementation Period is
automatically extended by an amount of time equivalent to the duration of the suspension.

Article 13: Termination

13.1

13.2

Without prejudice to any other provision ofthese General Conditions or penalties foreseen in
the EU Financial Regulation, where applicable, and with due regard to the principle of
proportionality, the Contracting Authority may terminate the Agreement ifthe Organisation:

a) fails to fulfil a substantial obligation incumbent on it under the terms of the Agreement;

b) is guilty of misrepresentation or submits false or incomplete statements to obtain the EU
Contribution or provides reports that do not reflect reality to obtain or keep the EU
Contribution without cause;

c) is bankrupt or being wound up, or is subject to any other similar proceedings;
d) is guilty of Grave Professional Misconduct proven by any justified means;

e) has committed fraud, corruption or any other illegal activity to the detriment of the EU’s
financial interests on the basis of proof in the possession of the Contracting Authority;

f) fails to comply with the reporting obligations in accordance with Article 3.15;

g) has committed any of the failings described in Article 12.3 on the basis of proof in the
possession of the Contracting Authority.

Before terminating the Agreement in accordance with Article 13.1, the Contracting Authority
shall formally notify the Organisation of its intention to terminate, inviting the Organisation
to make observations (including proposals for remedial measures) within thirty (30) days
from the receipt of the notification. During this period, and until the termination takes effect,

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Annex II - General Conditions Page 13

13.3

13.4

the Contracting Authority may suspend the time limit for any payment in accordance with
Article 12.2 as a precautionary measure informing the Organisation immediately in writing.
If the Organisation does not submit observations, or if, after examination of the observations
submitted by the Organisation, the Contracting Authority decides to pursue the termination,
the Contracting Authority may terminate the Agreement serving seven (7) days’ prior notice.
During that period, the Organisation may refer the matter to the responsible director in the
European Commission. Where the Contracting Authority is the European Commission, the
termination will take effect if and when confirmed by the director. Where the Contracting
Authority is not the European Commission, the referral to the responsible director in the
European Commission will not suspend the effects of the decision of the Contracting
Authority. In case of termination, the Contracting Authority may demand full repayment of
any amounts paid in excess of the final amount determined in accordance with Article 20
after allowing the Organisation to submit its observations. Neither Party shall be entitled to
claim indemnity by the other Party on account of the termination of this Agreement.

If, at any time, either Party believes that the purpose of the Agreement can no longer be
effectively or appropriately performed, it shall consult the other Party. Failing agreement on
a solution, either Party may terminate the Agreement by serving sixty (60) days written
notice. In this case, the final amount shall cover:

a) payment only for the part ofthe Action carried out up to the date of termination;

b) in the situations described in Articles 12.5 and 12.6, the unavoidable residual
expenditures incurred during the notice period; and,

c) in the situations described in Articles 12.5 and 12.6, reimbursement of legal
commitments the Organisation entered into for implementing the Action before the
written notice on termination was received by it and which the Organisation cannot
reasonably terminate on legal grounds.

The Contracting Authority shall recover the remaining part in accordance with Article 15.

In the event of termination, a final report and a request for payment of the balance shall be
submitted in accordance with Articles 3 and 19. The Contracting Authority shall not
reimburse or cover any expenditure or costs which are not included or justified in a report
approved by it.

Article 14: Applicable law and settlement of disputes

14.1

14.2

14.3

The Parties shall endeavour to settle amicably any disputes or complaints relating to the
interpretation, application or validity of the Agreement, including its existence or
termination.

Where the Organisation is not an International Organisation, and the European Commission
is the Contracting Authority, this Agreement is governed by EU law, complemented - if
necessary - by the relevant provisions of Belgian law. In the absence of an amicable
settlement in accordance with Article 14.1 above, the General Court, or on appeal the Court
of Justice of the European Union, has sole jurisdietion. Such actions must be brought under
Article 272 of the Treaty on the Functioning of the EU (TFEU). Notwithstanding the
foregoing sentence, where the Organisation is not established or incorporated in the EU, any
of the Parties may bring before the Brussels courts any dispute between them concerning the
interpretation, application or validity of the Agreement, if such dispute cannot be settled
amicably. Where one party has brought proceedings before the Brussels courts, the other
party may not bring a claim arising from the interpretation, application or validity of the
Agreement in any other court than the Brussels courts before which the proceedings have
already been brought.

Where the Organisation is not an International Organisation and the European Commission
is not the Contracting Authority, the Agreement shall be governed by the law of the country
of the Contracting Authority and the courts of the country of the Contracting Authority shall
have exclusive jurisdiction, unless otherwise agreed by the Parties. The dispute may, by
common agreement of the Parties, be submitted for conciliation to the European

Contribution Agreement 2018

Annex II - General Conditions Page 14