New Financial Regulation for better use of EU funds in the 2007-2013

The European Union has a new set of financial rules to better use EU funds in the 2007-2013 financial framework. The new rules simplify access to funding and reduce administrative procedures to a strict minimum. For the first time the names of the beneficiaries of all EU funds will be made public.

The New Financial Regulation (and its Implementing Rules), will accompany a new generation of EU programmes worth € 975 billion over a seven year period. Cutting red tape will facilitate access to these funds. Practical improvements for both grants and public contracts will be most important for SMEs (small and medium-sized enterprises), schools, universities, researchers, development agencies and municipalities:

• Grants of up to €25,000 require less documentation.
• Work done by staff may replace cash co-financing for grants.
• The financial guarantees required for grants below €60,000 prior to initial payment may be waived, after having assessed the financial risk.
• Purchases of up to €60 000 using grant money may be made with the minimum of rules to be respected, only the principle of sound financial management and the absence of conflict of interests will be required.
• Higher threshold (€60,000 instead of €50,000) for award of public contracts with simplified purchasing procedures.
• Higher threshold to allow organisations competing for low-value EU contracts to make a simple declaration on their honour, replacing complex evidence showing no previous malpractice convictions.
• Simplifications for award of public contracts in the field of external aid with much higher thresholds (up to €5,000,000 for works).