UNITED NATIONS European Commission

Operational conclusions of the 10th Annual Meeting of the Working Group

established under article 13.1 of the Financial and Administrative Framework Agreement (FAFA) between the European Communities and the United Nations

on 29th April 2003

1. Welcome and Introductory remarks

The meeting began with opening remarks from Mr. Roberto Ridolfi, Director for Sustainable Growth and Development, Directorate-General for Development and Cooperation -EuropeAid, European Commission (EC), and Mr. Chandramouli Kamanathan, Deputy Controller, United Nations (UN).

Mr. Ridoffi welcomed all representatives of the European Union Institutions1 and the United Nations entities. He recalled that in 2011, the EU Member States provided 40% of the funding for UN peacekeeping operations and 38% of the UN's regular budget as well as about one half of all UN Member State contributions to UN funds and programmes2. The financial commitment from the EU (EuropeAid) to activities of the UN for the financial year 2012 is more than €1.000 million3 .

1 From the European Union Institutions the meeting was attended by representatives of the European Commission (Directorate-General for Development and Cooperation - EuropeAid, the Directorate-General for Humanitarian Aid and Civil Protection - ECHO, the Directorate General for Budget, the Directorate-General for Enlargement, and the Service for Foreigp Policy Instruments - FPI) and of the European Court of Auditors

2 Source: UN Report "Saving and Improving Lives; Partnership between the UN and the EU in 2011" http://report2012 .unbrussels.org/mtroduction.htmltf&panel 1-1

3 httpi/'/cc.europa.eu/euiODeaid/who/partners/international-organisations/documents/un 2012 en.odf

Brussels, 22Ild October 2013

Ref. Ares(2014)1551297 - 15/05/2014

He commended the strong cooperation between the EU and the UN throughout the year and appreciated the support of the UN interlocutors in the Brussels office. A good collaboration between the EC and UN staff at Headquarters and in the field level was encouraged for ensuring that problems are dealt with in an efficient manner.

Mr. Ridolfi presented the key issues since the 9th Working Group meeting held in Vienna in April 2012:

• The new Financial Regulation and its Rules of Application entered into force on the 1st

of January 2013, which entailed adjustments to the Contribution Agreements with International Organisations. As from 2014, further adjustments need to be done to cater for the provisions concerning management modes; both ECHO and DEVCO legal teams have held discussions with the UN team in Brussels on the forthcoming adjustments to the legal framework governing relations with the UN.

• Three Joint Reference Groups (JRGs) have taken place, which have been a useful mechanism for discussing and giving guidance on FAFA related and systematic issues, e.g. the development or review of Frequently Asked Questions4 (FAQ).

• The EC Terms of Reference for verification missions on UN managed actions were published in April 2013, and cover the specific requirements and features for verifications on UN-managed actions5.

• The trainings on FAFA procedures jointly given by trainers from DEVCO and the UN team in Brussels have taken place successfully twice a year. The aim of these trainings is to contribute to a better management and accountability of EU actions channelled through UN bodies. These trainings will continue in 2014.

Mr. Ridolfi concluded his remarks by noting that the European Parliament has shown a very keen interest in the Commission's cooperation with International Organizations. Therefore, it is encouraged to continue the efforts on cooperation by addressing issues raised by the European Parliament or from the European Court of Auditore (ECA). Moreover, considering the good performance of EU-UN partnership!, the frequency of the Working Group meetings could be reconsidered from 2014 and beyond.

Mr. Kamanathan thanked the European Commission for hosting the meeting and noted the successful continuing partnership between the UN and the EC, through the FAFA. He highlighted that the implementation of IPS AS (International Public Sector Accounting Standards) by the UN System has resulted in strengthening internal controls, establishing accountability frameworks and achieving transparency. He looked forward to a continuing mutually collaborative relationship between the two entities.

A presentation on the EU-UN partnership for food and nutrition security 2008-2012, was given by Mr. Antonio Vigilante, Director of the UN Office in Brussels6. The report was

4http://ec.europa.eii/eiiropeaid/work/proceduŕes/faq/iiiíeraational_orgániszations_en.htrn

5 These are the terms of reference which are concluded between the EC and the respective contractor conducting the verification mission. In addition, there are the EC-UN Common Terms of Reference for verification missions.

6 Source: UN Report "Saving and Improving Lives: Partnership for food and nutrition security 2008-2012" http://unbmssels.org/report2013/

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presented to show the aim and the main results of the EU Food Facility to UN agencies. Some examples of what has been achieved together were presented. Food aid in emergencies has been provided in over 35 countries. In post-disaster countries, food-availability was aided through restoration of food production. The EU-UN collaboration through Food Facility has enhanced food security & resilience of 22 million people in 35 countries. Advances have been made on sustaining long-term food security, such as support to rural development, natural resource management and agriculture. It was reiterated that the continuous EU-UN collaboration is vital for the fight against hunger.

Mr. Vigilante emphasised that one should not lose sight of the real value the partnership delivers on the ground, of its purpose and objective. The 'contractual rules' shall be fit to serve the purpose and objective, always in accordance with the applicable regulatory iramework.

Mr. Walter Schwarzenbrunner, Director of "Resources, Partnerships and Operational Support" at DG ECHO, provided information on the cooperation between ECHO and the UN. The EU provided substantial needs-based assistance in 2012, with a total ftuiding of € 1,334 million, which has been the highest amount committed up to date. The 2012 breakdown for Humanitarian Agreements signed by DG ECHO showed that: 47% of actions were carried out by NGOs (118 partners), 44% by UN agencies (15 partners) and 9% by other International Organisations (3 partners). DG ECHO maintains regular high-level contact with relevant UN actors on policy developments and operational issues. DG ECHO and the UN advocate keeping humanitarian affairs on the international agenda.

Overall DG ECHO was satisfied with the work done with the UN. The ECHO-UN re-grouped Guidance (discussed later) and the on-going negotiations on the standard Indirect Management Delegation Agreement demonstrate ECHO'S commitment to finding better working methods with its UN Partners at the most appropriate level.

2. Follow-up of implementation of commitments made at 9th Working Group

The UN Office in Brussels presented the work done by the Joint Reference Group (JRG) ftom May 2012 to October 2013. The JRG which addresses matters broadly relating to the day-to­day implementation of the FAFA has met three times during the reporting period.

The following are the main results achieved by the JRG: • FAQ 48 on verification-related issues was revised and significantly expanded, and the

text agreed by the JRG will be sent for consultation. • FAQ 25 was revised as to clarify the limits for unilateral modifications of budgets and

the Action. • A new FAQ 54 was established to explain the difference between implementation and

execution period (terms used in EC contracts). • Minor adjustments to the FAQs were done to ensure their compliance with the new

Financial Regulation, mainly as regards to grants.

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As work in progress, it was mentioned that a draft of the FAQ on "weighted average" is to be resumed, over the course of 2014, the results of which will be reported at the next FAFA Working Group.

The FAQs 25 and 54 as well as the minor adjustments to the set of FAQs were formally endorsed by the Working Group.

Action points > The consultation procedure on FAQ 48 on verification and contradictory process will

be launched as soon as possible and this FAQ will be formally endorsed during the next Working Group meeting.

> The preparation of the FAQ on the weighted average (exchange rates for reporting purposes) will be resumed once the new 2014 contract templates are adopted and published.

3. Verification assignments

The UN Office in Brussels held a presentation on a study carried out by UN regarding the Assessment of Verifications. The presentation analysed the progress on the reduction of the number of verifications. According to the UN assessment study, it concluded that although the EC has gained access to information from UN internal audit reports, the number of verifications per year still remained high. As per the statistics produced by the UN on the disclosure of audit reports by UN entities, EC had access to 91% of the UN internal audit reports related to ECHO and DEVCO contributions channelled through the UN System in 2012.

The challenges faced during verification and RER (Residual Error Rates) exercises were noted by the UN. These were linked to (i) the timing and the number of the verifications and the RER studies, (ii) the potential deviation from verification process towards "quasi financial audit" and, (Hi) contradictory procedure on the findings included by verifiers in the verification reports and a need for a better communication between the UN agency concerned and the EU entity whenever a disagreement ("contradictory procedure") occurred.

As regards to the verifiers' profile, preference was expressed for verifications carried out by EC officials, rather than external private companies.

Subsequently, a set of suggestions was made on how to tackle the above challenges, in particular:

1. Further rationalization of the verification process by moving from "post facto control approach" towards "proactive support approach"

2. Continuous improvement of the planning, timing and procedure of the verification missions

3. Follow up on the verification findings and recommendations

In order to achieve the first recommendation, it was proposed to establish an EC-UN Verification Task Force to conduct a joint assessment to review the experiences and draw

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lessons learnt since 2007 when verifications first took place. Moreover, the use of information available from previous reporting (pillar review, internal and external audit reports, etc.) should also be considered.

To achieve the second recommendation it was proposed to further train the verifiers on contractual specifications of the EU-UN partnership, better involve EU staff during the verification missions conducted by private companies, avoid verifications after the end of the implementation of the project (verifications should rather take place during implementation period or at least within the 6 months after), continuously strive for improving communication between EU Delegations and UN entities in the field and review the need for repetitive or multiple verifications for the same country office of an UN entity, despite minor or no previous findings.

On the follow up of verification missions, a better sharing and use of the FAQs should be encouraged (i.e. "contradictory procedure"). More specifically, it is proposed to review the notion of "factual findings" presented in the reports, to exclude the "adding of verifiers' comments on UN comments", and to appoint an advisory/focal body where problems on verifications could be addressed. All of this would avoid the "ping pong" approach between both entities.

Mr. Jean-Louis Chomel, Head of Unit of "Audit and Control", DEVCO R2, provided comments and clarifications on the issues under discussion. He clarified that DG DEVCO's and DG ECHO'S situation regarding verification processes is different and cannot be compared. Regarding timing of the verifications, and considering that one of the objectives of verification missions is to check the use of the EU funds, Mr Chomel admitted that there might be a tendency to perform the verification mission after the project is closed. He also agreed that there might be room for improvement. However, the issue on the Residual Error Rate (RER) cannot be changed, since the RER exercise needs always to be carried out at the end of the action. .

Mr Chomel emphasized the importance of RER exercise to the EC and that UN's collaboration in making sure that the problems of 2012 are not repeated in 2013 would be highly appreciated.

While the UN would prefer the EC to be more centralized, the EC has decided to apply a decentralized model and consequently, verification assignments shall follow this model. It is hoped that the revised guidance (e.g. FAQ) will bring the expected improvement of the verification process.

He supported the suggestion of jointly looking at how UN internal audit reports can be better used but stressed that these reports do not always meet the verification needs as they might not cover certain aspects of the verification assignments. The use of UN internal reports should be optimized to tackle the EU's needs.

Summarizing, Mr. Chomel proposed to draw lessons from experiences learned during the last few years within 2/3 years' time. Addressing the challenges presented by the UN, Mr Chomel concluded that the current number of verifications with the UN is relatively low (39 in the Audit plan for 2013). Besides, the verification plan is risk-based and the number of verification assignments should increase if there is a rise in the level of EU funding.

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Subsequently, Mr. Ridolfi took the floor to discuss the issues at hand. It was affirmed that before taking a decision, EU Authorizing Officers do effectively perform all the necessary controls on the financial operations under their responsibility. They can use the results of audits for ensuring the sound management of the operations but this is just one among other control tools used by the Authorising Officers to perform their duties.

Furthermore, in response to the question of decentralization, Mr Ridolfi contended that the decentralization process has been executed over a five year time period, maintaining the same degree of accountability in the Delegations as well as in Headquarters. He stressed that the Authorising Officers in EU Delegations have the same degree of responsibility as those in EU Headquarters, and the Commission's standards on the quality of the work are equally applied and fulfilled by both staff in the field and in Headquarters.

Finally, in relation to the number of verifications, he argued that these are needed if the audit report has not covered certain aspects considered essential by the EC; he also recalled that the EC is accountable to the budgetary authority and the European tax payers for which it needs to establish a high degree of scrutiny of EU financial contributions.

Mr Ridolfi agreed that the EC could further discuss the possibilities to benefit from UN internal audits. Regarding the contradictory procedure, Mr. Ridolfi agreed that there could be room for improvement and discussions can be held in this subject.

Next, the UN expressed their position on the verification process. A desire to improve the efficiency of the verification process, and focus on results delivered, was expressed. In order to achieve this, one should continue the mutual dialogue, improve communication, and it was suggested that the EU could make use as much as possible of the information available from UN audits.

Mr. Ridolfi addressed the issue of results delivery and the need to move from results to impacts (which should be spelt out in the logical framework of the action), as well as to focus on expenditure efficiency. He highlighted the importance of the "pillars review" methodology that allows assessing the risk of working with International Organisations. This review has gone from 4 to 7 pillars, which makes the partner assessment even more comprehensive.

Mr. Harzé took the floor and proposed to be more "proactive" regarding the issue of timing and recalled the need to further reinforce the communication between both Institutions (i.e. regarding contractual procedures, FAQs etc).

Mr. Schwarzenbrunner, Director of ECHO C, agreed that the focus has to be in increasing impact and improving results and recalled the different set-up between DG ECHO and DG DEVCO. The humanitarian aid has distinctive features ftom the rest of EU external aid and the organization in the field (ECHO offices) is also different.

Mr. Ridolfi summarized this session with 3 suggestions, taking into account the current financial situation, results and deliverables:

1. Discuss improvement of planning and timing of verifications by taking a "proactive" support approach

2. Discuss improvement of the "contradictory system"

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3. Make the best possible use of internal audit reports when the audit matches the EU verification needs

Action points

> The JRG will explore whether the planning process of verifications and its timing could be further improved by incorporating a more proactive approach. Authorising Officers will be informed accordingly.

> The JRG will discuss whether the contradictory process relating to verification missions has been clarified in the reviewed and expanded FAQ 48 or if there are still any aspects which are not covered by this FAQ.

> The JRG will look into ways of better usage of UN internal audit reports as a valid contribution to EC verification whenever these reports meet the verification requirements.

> Following the completion of the pillars exercises (see point 4 below), lessons learnt and experience acquired on verification missions will be analysed from 2015 onwards.

4. Control-related issues

Mr. Chomel started this session by explaining the latest update of the compliance assessments. Comphance assessments must be carried out in accordance with the Terms of Reference to be established by EuropeAid. Until end 2013, the compliance assessment falls into 3 categories linked to the management modes used:

• Procedures and arrangements under joint management (4 Pillars) • Procedures and arrangements under decentralised management (5 Pillars) • Procedures and arrangements under indirect centralised management (7 Pillars)

The Financial Regulation (FR) applicable to the General Budget of the EU has undergone significant changes. As of 1st January 2014 there will only be three management modes: direct management, shared management and indirect management. The latter merges the current modes for joint management, decentralised and indirect centralised management.

The new FR is more demanding as regards to compliance assessment because it sets out much stricter requirements for Indirect Management. For example: for internal control and procurement the focus is now on design and operational effectiveness and also there are new pillars to be assessed: Grants, Financial instruments and Sub-delegation.

Mr. Chomel stated that all International Organisations currently working with the EC under joint management mode and wishing to be entrusted with budget implementation tasks under indirect management will have to be re-assessed. DEVCO R.2 will send a letter to the UN entities, and each UN agency will have to say whether they are interested in being re-assessed and what pillars are applicable to them.

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It is foreseen that the re-assessment will take one year. ECHO has already started to carry out these re-assessments. The re-assessments performed by ECHO will also be valid for DEVCO.

New Terms of Reference on pillars assessment have been developed and will soon be subject to DEVCO Management for approval. In the next weeks the UN should receive communication regarding the next steps. The current proposal is that the Commission launches the re-assessments of UN agencies, following what has already been started by DG ECHO.

The UN stressed that there should be only one pillar assessment per UN entity with no overlap of pillar assessment done by DEVCO and ECHO.

,Mr. Ramanathan, gave a presentation on PSAS adoption by UN System Organizations. He stated that the implementation of IPSAS, would bring about a significant improvement on how the UN Organizations manage as well report on their assets and liabilities, while providing donors a greater level of assurance through the more detailed and annual audit of the financial statements by independent external auditors. Mr.Ramanathan also presented the recent activities of the Task Force on Accounting Standards.

The Director of the European Court of Auditors (ECA) Mr. Philippe Froidure was invited to take the floor. He exposed the roles and responsibilities of the ECA on control-related issues of EC-funded actions. Firstly, he discussed the persistent misunderstanding of the Court's role by some UN entities representatives. He stressed that the Terms of Reference for the verification missions agreed between the Commission and the UN do not apply to the Court's audits.

He agreed on the importance of the Authorising Officers and he explained that they are part of the cornerstone of the devolution process in the EC. He stressed that the ECA does not audit the UN but does look at the EU budget.

Three elements that were discussed were: - The Residual Error Rate (RER), was a request from the European Court of Auditors - The new Financial Regulation (FR) with much stricter compliance requirements for

working under the Indirect Management mode are to be applied from 2014. - The European Court of Auditors and the Commission have issued legal opinions to the

World Bank to overcome some confidentiality issues. He suggested a similar approach for the UN family.

Mr Froidure took this opportunity to thank all the facilitators in the ECA work: The Court's auditors need their collaboration in order to collect the information which is necessary for a successful accomplishment of the audit work.

Mr Ridolfi suggested to look into the possibility of providing legal opinions on confidentiality, similar to the one issued for the World Bank. The UN wanted to know if the pillar assessment can be leveraged for verification missions,

Mr. Chomel expounded on the difference between pillar assessments which are ex-ante exercises and verification missions which are ex-post exercises. The pillars assessment verifies that funds are spent properly and systems are working adequately. It also allows the International Organisation to apply its own rules subject to the conditions laid down in the EU

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Financial Regulation. He recalled that the decision to reinforce the pillar assessment of International Organisations has been taken by the European Parliament and by the Council.

Mr. Froidure explained that the Court may use the work done by the external auditors of an International Organisation if this audit work meets the Court's needs, which is not always the case.

Mr. Ridolfi summed up the discussion and reminded the participants that the Commission must abide by the Financial Regulation and its Rules of Implementation. This EU financial framework is adopted by the institutions with decisional power on budgetary matters that is, the European Parliament and the Council of Ministers.

Action points

> DEVCO.R2 informed the Working Group on the current state of play of the pillars assessment. The Pillars re-assessment is expected to be finished by end October 2014. DEVCO.R2 will update the Working Group on this exercise in the next meeting.

> There will be no overlap between the pillar assessments done by DEVCO and ECHO.

> As regards to access to UN internal audit reports, the UN noted that its entities currently gave full disclosure to internal audit reports covering around 91% of DEVCO and ECHO funding in 2012. However, disclosure of internal audit information for the remaining (some 9%) should be pursued. The UN will inform the next Working Group on progress made on the disclosure procedures of those entities that do not yet give full access to internal audit reports.

> Confidentiality issues: DEVCO.R3 will look into the possibility of issuing a "legal opinion" from the legal services of the Commission relating to the confidentiality of some documents requested to the UN.

5. Other operational and reporting issues

The next session in the agenda was the new reporting requirements of the Financial Regulation regarding International Organisations (10). It was presented by Mr. Lars Jorgen Magnusson from DG Budget, unit "External Policies".

Key mission of DG Budget is to secure from the budgetary authority - the European Parliament and the Council of Ministers - the resources needed to implement the Union's policies, to encourage sound management of Community iunds and to account for the use of appropriations. DG Budget is thus responsible for preparing the annual draft budgets, the multi financial framework and to supply different reports to the Budget Authority.

He explained that the new Financial Regulation foresees that the Commission shall attach, to the draft budget, a working document containing a summary of funding to 10. This report does not include funding from the European Development Fund (EDF).

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He presented the amount of legal commitments made to international organisations írom the approved 2012 EU Budget. Around 40% were made to the UN family.

Subsequently, DEVCO's Financial Instrument unit, DEVCO.C3, presented the main issues contained in the update sent to the European Parliament on the use of the Joint EC-UN Guidelines on Reporting7 in August 2013.

DEVCO.C3 reminded that the Working Group of April 2011 endorsed the Guidelines for a trial period of one year. After this trial period, the Working Group of April 2012 confirmed endorsement of the guidelines and recognised it was too early to assess their value.

The update note to the Parliament covers the relevance of the Guidelines, their contribution to the improvement of reporting and accountability as well as measures taken and possible lines of action in the future.

As regards to the relevance of the Guidelines, DEVCO.C3 informed that they appear to be suitable for EC-UN staff involved in the preparation and scrutiny of reports on projects implemented through the UN. The Guidelines are considered to contribute to accountability of EU-funded actions implemented through UN Organisations, although dissemination efforts need to be undertaken on a regular basis so that all staff concerned follow the Guidelines and consult it whenever necessary. Quality of UN reporting needs to be iurther improved which will result in less time and resources being spent in order to obtain a report that eventually meet the reporting standards set out in the Guidelines

Finally, DEVCO.C3 informed about possible lines of action to be undertaken as from 2014. Firstly, the consistency between the Guidelines and the new regulatory framework should be checked. Secondly, actions to further disseminate the Guidelines should be discussed. Thirdly, there should be an analysis of recurrent problems. Finally, there should be a further discussion on other possible EC-UN joint efforts and actions.

In response to DEVCO.C3 presentation, the UN expressed their expectation for further guidance on the quahty standards for reporting to be observed.

Mr. Schwarzenbmnner presented to the Working Group the ECHO-UN Guidelines for endorsement. These Guidelines have been in force for a trial period of one year.

Mr Schwarzenbrunner reminded that at the 7th FAFA WG in 2010 mandated the re-grouping into one single document of those aspects of ECHO's guidance which would apply to the UN (in particular for multi-donor actions). Mr Schwarzenbrunner stated that the ambitious task of producing a single document was accomplished in 2012 by a task-force of representatives ftom a few UN Agencies and from DG ECHO, who met since My 2010 to produce a draft text of the Guidelines. At the 9th WG it was decided to send the document to UN entities for consultation in line with the consultation process agreed by the WG in 2009. After that, it was agreed to apply the Guidelines for a trial period of one year and to endorse them at the next

7 The Joint EC-UN Guidelines on Reporting are available under: http://ec.europa.eu/euroDeaid/work/procedures/finaftcing/intemational organisations/other documents relat ed united nations/index en .htm

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WG meeting. Mr Schwarzenbrimner informed that ECHO considers the Guidelines an important step in developing the mutual understanding between ECHO and the UN, and believes that during its over one year application it proved to be a useful interpretative and guidance document, and helped to improve working relations with the UN by adding more clarity on the applicable rules and more consistency in how they are implemented in practice..

The ECHO-UN Guidelines were formally endorsed in its current form by the Working Group.

Action point

> In 2014, the Joint Reference Group will undertake a consistency check of the EC-UN Joint Guidelines of reporting obligations with the new financial rules. In a second stage, the Group would analyse the feedback received and lessons learnt in order to look into possible actions for further enhancing the Guidelines.

6. New EU Financial Regulation: Adjustments to the legal framework governing relations with the UN

This session was presented by Dr. Carlos Casal, from DEVCO R3, Legal Affairs Unit. Dr Casal provided an extensive explanation and presentation on the procedures applicable for contracts concluded between the EC and 10 within the frame of the previous and the new Financial Regulations.

Dr Casal reminded the Working Group on the different types of Management Modes for EC-funded contracts and more specifically on the fimctioiiing of the Joint Management procedure. Dr Casal presented the financial and contractual procedures within the scope of the Financial Regulations until 2012, the rules governing management modes during the year 2013 and the main changes affecting management modes as from 2014.

Subsequently, Dr Casal provided information on the updates of the templates for managing EC-UN contracts within the new Financial Regulations, the revised Standard Contribution Agreement 2013, the Grant contract and the Indirect Management Delegation Agreement (IMDA) which will be in force from January 2014.

Regarding the Grant Contract, Dr Casal informed that the draft grant template includes an annex with derogations set out for IOs. He explained that the derogations cover areas of the IO, such as its internal control rules and accounting (Pillar Assessment), procurement rules and the rules of nationality and origin (Annex IV), evaluation and monitoring, transfer of assets and effects of termination.

Regarding the IMDA, Dr Casal informed that this modality of management is used to delegate budget implementation tasks and it is also a tool used when there are direct implemented activities undertaken by the Commission together with budget implementation tasks entrusted to the entity.

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DEVC0.R3 has been in close contact with the UN team in Brussels and regular meetings to discuss the grant template and the IMDA have been held. In this context, Dr Casal stated that discussions on the final contractual templates are well advanced, in particular for the Grant Contract and it is expected to reach an agreement on the final version of the templates in the coming weeks.

Regarding the FAFA, Dr. Casal informed about the necessity of an addendum to the FAFA, in order to adjust it to the new Financial Regulation.

Dr Casal informed that it is expected to launch an Inter-Service Consultation and publish the addendum of the FAFA once signed by both parties via an exchange of letters as to be applicable by 1st January 2014.

Charles Pirotte (ECHO, Finance, Legal affairs and Partner Support unit) drew a distinction between those features of the IMDA that would be the same for both DEVCO and ECHO as they reflect a shared understanding of the EU Financial Regulation's provisions on indirect management, and those features particular to ECHO due to the specific nature and characteristics of humanitarian aid. He informed the WG that DG ECHO would most likely only issue an IMDA template, as ECHO was not envisaging a specific grant agreement template for the time being. He referred to the regular contacts between ECHO and its UN counterparts for the preparation of the IMDA template. He stressed also that ECHO had a different set-up in the sense that it will not have Common Implementing Rules, like DEVCO, which puts in some respects (e.g. threshold for publication of information on beneficiaries of grants by the UN) since ECHO is in a different situation as far as contractual procedures are concerned.

The presentation on the adjustments to the legal framework was followed by a round of questions for clarification matters.

Action point

> DEVCO.R3 will continue to discuss with the UN the contractual templates to be used from 2014.

7. Endorsement of FAQs

This point was tackled in point 2 above.

8. Communication and visibility activities

Mr. Hubert Perr. from DEVCO, unit "Communication and Transparency" conveyed the importance of communication and visibility, within the context of FAFA. It was transmitted that in these times of economic crisis in Europe, which has led to increased social pressures, there exists an increased focus on accountability. He advocated towards better visibility of the results delivered to Member States and the public.

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He reminded that communication is contractually enshrined in the cooperation between the UN and the EC in the FAFA itself; the joint visibility guidelines for EC-UN action, signed on April 2008 and the Joint Action Plan on visibility in 2006. He pointed out that the EC is very interested to be engaged in dialogue with beneficiaries. Policy dialogue with governments and other main actors.

The Working Group agreed on all points presented by Mr Perr.

CO-CHAIR

Chandramouii Ramanathan, Deputy Controller, United Nations

Roberto RIDOLFI Director for Sustainable Growth and Development

DG for Development and Cooperation - EuropeAid, European Commission

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