Committee procedure
1. The Commission shall be assisted by a committee. That committee shall be a committee within the meaning of Regulation (EU) No 182/2011.
2. The EDA shall be invited to provide its views and expertise to the committee as an observer. The European External Action Service shall also be invited to assist in the work of the committee.
3. The Commission may, on its own initiative or upon request from one or more Member States, invite, where relevant, representatives of Ukraine to attend meetings of the committee. Representatives of Ukraine shall not be present during deliberations or participate in voting of the committee.
4. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply.
5. Where the committee delivers no opinion, the Commission shall not adopt the draft implementing act and Article 5(4), third subparagraph, of Regulation (EU) No 182/2011 shall apply.
Financing agreement with Ukraine
1. The Commission shall conclude with Ukraine a financing agreement within the meaning of Article 114(2) of the Financial Regulation for the implementation of the actions set out in this Regulation which concern Ukraine or legal entities established in Ukraine receiving Union funds.
2. The financing agreement concluded with Ukraine and contracts and agreements signed with legal entities established in Ukraine receiving Union funds, shall ensure that the obligations set out in Article 129 of the Financial Regulation can be fulfilled.
3. The financing agreement shall lay down the obligations of the Ukrainian authorities and bodies entrusted with budget implementation tasks to take all necessary measures, including legislative, regulatory and administrative measures, to respect the principles of sound financial management, transparency and non-discrimination, to ensure the visibility of Union action when managing the Union funds, to fulfil the appropriate control and audit obligations and assume the resulting responsibilities, and to protect the financial interests of the Union, by, in particular, detailed enacting provisions concerning:
(a)
the activities related to control, supervision, monitoring, evaluation, reporting and audit of Union funding under the Ukraine Support Instrument, as well as activities related to investigations, anti-fraud measures and cooperation;
(b)
rules on taxes, duties and charges in accordance with Article 27(9) and (10) of Regulation (EU) 2021/947 of the European Parliament and of the Council ( 47 ) ;
(c)
the right of the Commission to monitor activities under this Regulation carried out by the legal entities established in Ukraine, along the whole project cycle, including for cooperation for common procurement action, to take part in those activities as observer, as appropriate, and to make recommendations for the improvement of such activities, and a commitment by the Ukrainian authorities to make their best efforts to implement such recommendations of the Commission and to report on that implementation;
(d)
the obligations referred to in Article 83(2), including precise rules and a timeframe regarding the collection of data by Ukraine and access to such data by the Commission and the European Anti-Fraud Office (OLAF);
(e)
the protection and handling of classified information in accordance with applicable rules;
(f)
provisions on protection of personal data.
4. Funding shall only be granted to Ukraine after the financing agreement has entered into force and the actions needed to implement the requirements it establishes have been implemented by the parties.
5. The Commission shall ensure that, from its side, all necessary steps are taken for the financing arrangement to become effective no later than 1 July 2026.
Protection of classified information
1. Classified information that is created, handled, stored, exchanged or shared under this Regulation shall be protected in accordance with the security rules set out in Commission Decision (EU, Euratom) 2015/444 ( 48 ) or the Agreement between the Member States of the European Union, meeting within the Council, regarding the protection of classified information exchanged in the interests of the European Union, as appropriate.
2. The participating Member States shall decide who is the originator of classified foreground information generated in the implementation of eligible actions listed under Article 10.
3. The Commission shall have access to the classified information necessary for carrying out the tasks assigned to it under this Regulation concerning the eligible actions listed under Article 10.
4. In the context of a SEAP, the rules on the protection of classified information referred to in Article 45(1), point (n), shall comply with paragraph 1 of this Article.
5. Where a SEAP includes associated countries or Ukraine among its members or observers, such SEAP shall ensure a level of protection equivalent to that afforded by the Agreement between the Member States of the European Union, meeting within the Council, regarding the protection of classified information exchanged in the interests of the European Union.
6. The applicable security framework for an action shall be put in place by participating Member States at the latest before the signature of the grant agreement or the contract. The relevant documents shall form an integral part of the grant agreement or the contract.
7. The Commission shall set up a system that is security accredited in accordance with Decision (EU, Euratom) 2015/444 in order to facilitate the exchange of classified information between the Commission and the Member States and associated countries, and, where appropriate, with the applicants and the recipients.
Confidentiality of information
1. Information received as a result of the application of this Regulation shall be used only for the purpose for which it was requested.
2. Member States, the Commission, the European External Action Service and the EDA shall ensure the protection of trade and business secrets and other sensitive information acquired and generated in application of this Regulation in accordance with Union law and respective national law.
3. The Commission shall handle information containing any data of an entity or any trade secrets in a way not less stringent than the handling of sensitive information, including the application of the ‘need-to-know-principle’ and the use of appropriate encrypted environments for the handling and sharing of such information.
Personal data protection
This Regulation shall be without prejudice to Directive 2002/58/EC of the European Parliament and of the Council ( 49 ) and Regulations (EU) 2016/679 ( 50 ) and (EU) 2018/1725 ( 51 ) of the European Parliament and of the Council.
Audits
Audits on the use of the Union contribution carried out by persons or entities, including by persons or entities other than those mandated by the Union institutions, bodies, offices or agencies, shall form the basis of the overall assurance pursuant to Article 127 of the Financial Regulation. The European Court of Auditors shall examine the accounts of all revenue and expenditure of the Union in accordance with Article 287 TFEU.
Protection of the financial interests of the Union
1. Where an associated country participates in the Programme by means of a decision adopted pursuant to the Agreement on the European Economic Area or on the basis of any other legal instrument, the associated country shall grant the necessary rights and access required for the authorising officer responsible, OLAF and the European Court of Auditors to comprehensively exercise their respective competences. In the case of OLAF, such rights shall include the right to carry out investigations, including on-the-spot checks and inspections, as provided for in Regulation (EU, Euratom) No 883/2013.
2. The agreement referred to in Article 78 shall provide for the obligations of Ukraine:
(a)
to take appropriate measures to prevent, detect and correct irregularities, fraud, corruption and conflicts of interest affecting the financial interests of the Union, to detect and avoid double-funding and to take legal action to recover funds that have been misappropriated;
(b)
to regularly check that the financing provided has been used in accordance with the applicable rules, in particular regarding the prevention, detection and correction of irregularities, fraud, corruption and conflicts of interest;
(c)
to accompany a request for payment under the Ukraine Support Instrument with a declaration that the funds were used in accordance with the principle of sound financial management and for their intended purpose and managed appropriately, in particular in accordance with Ukrainian rules complemented by international standards on prevention, detection and correction of irregularities, fraud, corruption and conflicts of interest;
(d)
to expressly authorise the Commission, OLAF, the European Court of Auditors and, where applicable, the European Public Prosecutor’s Office to exert their rights as provided for in Article 129(1) of the Financial Regulation, in application of the principle of proportionality.
Information, communication and publicity
1. The recipients of Union funding shall acknowledge the origin of the funds and ensure the visibility of that funding, in particular when promoting the actions and their results, by providing coherent, effective and proportionate targeted information to multiple audiences, including the media and the public.
2. The Commission shall implement information and communication actions relating to this Regulation, to actions taken pursuant to this Regulation, and to the results obtained.
3. Financial resources allocated to the Programme and to the Ukraine Support Instrument shall contribute to the corporate communication of the political priorities of the Union, in so far as those priorities are related to the objectives referred to in Articles 4 and 22.
4. Financial resources allocated to the Programme and to the Ukraine Support Instrument may contribute to the organisation of dissemination activities, match-making events and awareness-raising activities, in particular aiming to open up supply chains to foster the cross-border participation of SMEs.
Monitoring, evaluation and review
1. The Commission shall monitor the implementation of the Programme and of the Ukraine Support Instrument on a regular basis and report annually on progress made, including on the level of involvement of SMEs and small mid-caps and on the overall expenditure of the Programme and the Ukraine Support Instrument broken down by type of actions and by form of Union contribution, to the European Parliament and to the Council.
The Commission shall put in place necessary monitoring arrangements ensuring that data for monitoring the implementation and the results of the Programme and of the Ukraine Support Instrument are collected efficiently, effectively and in a timely manner. To that end, proportionate reporting requirements may be imposed on recipients of Union funds and, where appropriate, on Member States.
2. By 30 June 2027, the Commission shall draw up a report, based on indicators where appropriate, evaluating the implementation of the measures set out in this Regulation and their results and assessing the need for a possible revision of this Regulation. The evaluation report shall build on consultations of the Member States and key stakeholders and shall evaluate the contribution of this Regulation to the progress made towards increasing the value of defence equipment procured in the Union in a collaborative manner, the value of intra-EU defence trade and the value of Member States’ defence investment procured in the Union.
3. The Commission shall present the report to the European Parliament and the Council, accompanied, where appropriate, by relevant legislative proposals.
Entry into force
This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union .
Source: EUR-Lex (Publications Office of the EU), © European Union, reuse permitted under Commission Decision 2011/833/EU.
