Please provide clarification on content of the Feasibility Study (FS) and independent quality review.
According to the Article 43 (2c) of the Implementing Rules No 897/2014 project full application for projects including an infrastructure component of at least EUR 1 million shall contain a full feasibility study or equivalent carried out, including the options analysis, the results, and independent quality review. For infrastructure object under 1 million (e.g. reconstruction of the Manor house in Pskov) the feasibility study and independent quality review shall not be prepared.
a) There can be a joint feasibility study drawn up for all infrastructure objects or a separate feasibility study for each infrastructure object within the project. If the feasibility study is in national language, a summary in English has to be submitted. The feasibility study may be prepared by the applicant/ project partner or external expert.
b) The feasibility study should include summary of main elements of the feasibility study and its findings, overall socio-economic situation on the region where the infrastructure activities will take place, project background (including information about the project partners, target groups and final beneficiaries, location of the infrastructure activities, current situation, planned infrastructure activities, necessity to implement the project (social or environmental needs), problems to be solved), option analysis (analysis of different scenarios, alternatives), planned outputs, results and long-term results, risk analysis.
c) Option analysis: the applicant shall demonstrate that the chosen project option is the best of the possible technical and economic alternatives. The analysis shall be conducted for the scenario with and without investment. They should be comparable on the basis of number of criteria e.g. technical, institutional, economic and environmental (e.g. is it better to modernise already existing infrastructure or to build a new one, analysis of different technological solutions).
d) Independent quality review:
- If the feasibility study is conducted by an external expert, the independent quality review is not required (as the feasibility study “by default” is considered independent).
- If the feasibility study is conducted by the applicant, the independent quality review shall be prepared by an independent field expert (with relevant education and experience in the respective field (e.g. road construction, water treatment or building construction). Person who was involved in preparation of project documentation (including feasibility study) in any way may not prepare independent quality review (they shall be functionally independent from each other). The independent expert shall provide review on correctness of the feasibility study and chosen option for implementation of the project and in the independent quality review shall provide confirmation of the independence from the applicant.
Please provide information about requirements relating to the Environmental Impact Assessment.
According to the Article 43 (2d) of the Implementing Rules No 897/2014 project full application for projects including an infrastructure component of at least EUR 1 million shall contain an assessment of its environmental impact in compliance with the Directive 2011/92/EU of the European Parliament and of the Council for the project partner from the Republic of Latvia, and for the partners from the Russian Federation in compliance with UN/ECE Espoo Convention on Environmental Impact Assessment in a Transboundary Context of 25 February 1991.
For LV parners: The requirements of the directive 2011/92/EU were transposed into Likums “Par ietekmes uz vidi novērtējumu” (https://likumi.lv/doc.php?id=51522). Therefore the requirements of this law shall be applicable for LV partners.
Additional information for LV partners: http://www.varam.gov.lv/lat/darbibas_veidi/ietekmes_uz_vidi_novertejums/
For RU partners: In the Espoo Convention the cases, when the environmental impact assessment is required, and the content of it are indicated (see Appendix 1 “List of activities” and Appendix 2 “Content of the Environmental Impact Assessment documentation” of the Convention).
Consolidated Espoo convention in English: https://www.unece.org/env/eia/about/eia_text.html .
Please provide clarification regarding the Value Added Tax (VAT) issue. How the partner can prove that the VAT is not recoverable?
If the applicant or the project partner cannot recover the VAT, in the corresponding partnership statement the tick mark shall be put:
- our organisation is not entitled to recover any paid VAT by whatever means, and therefore all the expenditure related to the project to be reported will include VAT.
Besides, by evaluating the projects and by making the audit of the expenditures it will be checked whether the VAT is recoverable. The recoverable VAT are non-eligible costs.
Are the customs duties non-eligible costs?
According to the Article 49 (1 f) of the Commission Implementing Regulation No. 897/2014 custom duties are non-eligible costs.
Is there a need to submit the confirmation of ownership / access to the land once again at the full application preparation stage (since it has been submitted already at the summary preparation stage)?
In case there are no changes in the confirmation of ownership/ access to the land, which was submitted to the Managing Authority together with the Summary, the confirmation of ownership / access to the land shall not be submitted again. If there are some changes in the confirmation of ownership/ access to the land, updated document shall be submitted together with the full application.
Is there a need to provide all technical design documents on paper or it can be a soft copy together with the full application?
The technical design documents shall be provided by the applicant to the Managing Authority both on paper (as original) and as a soft copy. Detailed information see in the point 3.3.1 of the Guidelines for Direct Award Project Applicants.
If the building permit is not available by 30 June 2017 may it be submitted later to the Managing Authority?
The building permit shall be provided to the Managing Authority by 30 June 2017. If by this deadline the building permit is not available in the cover letter submitted together with the full application the applicant indicates the planned date of submission of the building permit to the Managing Authority and well-grounded reason for the delay.
In case the building permit is not requested by the national legislation for a particular type of investment, the applicant submits a declaration by the applicant/partner that according to national legislation (reference to respective act/law and respective article) the infrastructure in question is not the subject of building permit.
When the procurement can be started, i.e. only after the Grant Contract is signed or before?
On project own risk procurements can be started before the Grant Contract is signed, but the payments can be made only after the project start date indicated in the Grant Contract (see the section 5.1.1 of the Guidelines for Direct Award Project Applicants), except the retroactive and preparatory costs (see the section 6.2 of the Guidelines for Direct Award Project Applicants).
Can the associated partners be added in the application form if they were not mentioned in the Summary? If yes, what are the obligations of such associated partners?
Yes, it is possible to add the associated partners in the application form as it was optional to provide this information in the direct award project summary. Associated partner may be any organisation that contributes to the implementation of a project regardless of its location and legal status. Information on associated partners shall be provided in the sheet XVI of the application form. Each associated partner has to sign also the letter of endorsement. It is not eligible for associated partner to receive funding from the grant with the exception of accommodation and travel costs for the events organised and paid within the project by the beneficiaries. Associated partners do not have to meet the eligibility criteria. There will be no audits or other external checks of the associated partners.
What is the possible approximate date when the Grant Contracts can be signed?
By very optimistic scenario in March 2018 if a) the Direct Award Project full application is approved by the European Commission; b) Financing agreement is ratified by the Russian Federation; c) Partnership agreement signed by all partners is submitted to the Managing Authority; d) original of the financial identification form filled in by the bank is provided to the Managing Authority and e) additional documents are provided upon the request of the Managing Authority.
Is it possible to include additional information specific for the project into the Partnership Agreement to avoid misunderstanding among the partners?
Yes, it is possible. The Partnership Agreement is available here (see Partnership agreement template to the Call for Proposals pack) – https://latruscbc.eu/for-applicants/guidelines-for-applicants/). However the made changes shall not contradict the requirements of the legal framework of the Programme (see point 1.5 – legal basis of the Grant Contract).
Please provide clarification on the financial flow form (Annex X to the Guidelines for Direct Award Project Applicants). How expenses and incomes of the project into quarters and years shall be divided?
In the financial flow form the expenses positions of the project shall correspond to the project budget headings and the total expenses shall correspond to the total budget of the project. The expenses shall be grouped into quarters according to the day when the costs incurred (meaning the payment is made from the account of the applicant/partner). The income shall be grouped into quarters by the planned date of the income receipt. For example, the initial pre-financing instalment will be paid to the beneficiary within 30 days after signing of the Grant contract, i.e., in the first quarter of the 1st year of the project implementation.
How to indicate preparation of the technical documentation in Time Plan if this is reflected in Activity Package 3?
Preparation of technical documentation or any other retroactive costs must be indicated in Activity package 3 “Infrastructure investments” but it shall not be indicated in Time Plan at all. Time Plan reflects only those activities from all Activity Packages which will take place after the signing of Grant Contract.
According to the point 6.4 of the Guidelines for Direct Award Project Applicants (page 28) total amount of financing on the basis of lump sums, unit costs and flat rate financing within budget headings from 1 to 6 may not exceed EUR 60 000 per project. Does this limit (EUR 60 000) refer to the retroactive costs?
No. According to the point 6.2 of the Guidelines for Direct Award Project Applicants the retroactive cost are covered as real costs up to 7% of the relevant, planned in the project infrastructure and works object’s costs. If real amount of retroactive costs is less than 7% of the relevant, planned in the project infrastructure and works object’s costs then real amount of retroactive costs paid by beneficiary should be indicated in the Project budget. It is not flat rate, therefore limit of EUR 60 000 does not refer to the retroactive costs.
Are Administrative costs allowed if no staff costs are planned in the budget of the project?
Yes. According to Section 6.4. of Guidelines for Direct Awards Project Applicants indirect costs under “Office and administration costs” are calculated as a flat-rate of up to 7% of eligible direct costs, excluding costs incurred in relation to the provision of infrastructure (7% of budget headings from 1 to 4), provided that the rate is calculated on the basis of a fair, equitable and verifiable calculation method.