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Co-financing with non-governmental development organisations

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This Regulation establishes the administrative procedures for the European Community's co-financing of operations in developing countries with European NGOs. As of 1 January 2007 these rules have been replaced by the Regulation establishing a financing instrument for development cooperation.

ACT

Council Regulation (EC) No 1658/98 of 17 July 1998 on co-financing operations with European non-governmental development organisations (NGOs) in fields of interest to the developing countries.

SUMMARY

1. Background
As civil society actors, the NGOs play an increasingly important role in the implementation of aid in the developing countries. For several years, the European Community has recognised their key role and given priority to and underlined the importance of their autonomy and independence.

2. Co-financed operations
The Community co-finances three types of operations:

  • operations in the field
    These are operations implemented in the developing countries at the initiative of the NGOs and their partners in these countries. The main aim of these operations must be to combat poverty and they concern, in particular, local social and economic development in rural and urban areas, the development of human resources, particularly by means of training, and institutional support for local partners in the developing countries;
  • operations to raise public awareness in the EU of the problems relating to development and the relations between the industrialised and developing countries
    In particular, they should highlight the interdependence of the Member States and the developing countries, encourage cooperation between NGOs and enable partners in the developing countries to play an active part;
  • operations to reinforce cooperation and coordination between NGOs from the Member States and the Community institutions
    These operations should support the development of appropriate exchange and communication networks.

All operations suitable for Community co-financing must be sustainable, be clearly defined, monitor objectives, provide indicators of achievement for projects, and be consistent with other operations in this field.

3. Partners
The actors eligible for co-financing must satisfy certain conditions. In short, they must be autonomous, non-profit-making organisations, they must have their headquarters in a Member State and the majority of their funding must originate in Europe. Additional criteria relate to experience and knowledge, administrative and financial management capacities, the ability to support operations, and the nature of links with partners in the countries in question.

4. Financial provisions
Community co-financing takes the form of grants. Co-financing contracts are subject to the provisions of the Financial Regulation applicable to the general budget of the European Communities. They may also by subject to on-the-spot checks by the Commission and/or the Court of Auditors under this Financial Regulation.
Community financial support is provided in foreign or local currency. It may be used for investment spending, operational spending linked with investment, and spending necessary for the smooth implementation of the co-financed operations, including the administrative costs of NGOs.
NGOs must encourage the partners in the developing countries to contribute in kind or financially, according to their means.
The Community contribution must not exceed 50% of the total cost or 75% of total contributions, except in exceptional cases, where the contribution must not exceed 85%.
Community contributions exceeding EUR 2 million must be submitted for the opinion of the Committee of the Member States that assists the Commission.

5. Role of the Commission
The Commission is entrusted with appraising, deciding on and administering the Community co-financing of operations, including evaluation. It is assisted in certain tasks by a committee composed of the representatives of the Member States and chaired by the Commission. As a rule, the decision as to whether an operation is to be supported should be taken within six months of the date of receipt of the application from an NGO.
Every three months, the Commission must inform the Member States of the co-financing projects and programmes approved, indicating their amounts, nature, etc.

6. Annual report and evaluation
Following each budget year, the Commission must report to the European Parliament and the Council, providing information on the NGOs concerned and the operations financed, an evaluation of the budget year and general guidelines for the following year. The guidelines are submitted for the committee's opinion.

The operations co-financed are evaluated regularly.
Three years after this Regulation enters into force, the Commission must submit to the European Parliament and the Council an overall evaluation of the operations financed by the Community under the Regulation, together with suggestions regarding the future of the Regulation. Such an evaluation was carried out in 2000 and discussions are being held between the various parties.

REFERENCES

ActEntry into force - Date of expiryDeadline for transposition in the Member StatesOfficial Journal
Regulation (EC)
No. 1658/98
02.08.1998-OJ L 213 of 30.7.1998

RELATED ACTS

Regulation (EC) No 1905/2006 of the European Parliament and of the Council of 18 December 2006 establishing a financing instrument for development cooperation [Official Journal L 378 of 27.12.2006].

This Regulation repeals Regulation (EC) No 1658/98.

Last updated: 12.09.2007
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