Answer given by Mr Hahn on behalf of the European Commission

To protect the financial interests of the Union, the Commission implements the mechanisms provided in the Financial Regulation[1] and contractual documents (procurement contracts, grant agreements etc.), including suspension and termination, for example in the event of confirmed or suspected cases of fraud, irregularities, and grave professional misconduct. These do not just constitute grounds for suspension and termination but also exclusion from future funding.

The recipients of Union funding are subject to the absence of any exclusion ground as defined in the Financial Regulation. The checks against the exclusion criteria are based on a declaration of honour by the entity, complemented with relevant evidence[2].

The non-compliance with an exclusion requirement leads to the exclusion and subsequent rejection of the entity from award procedures. Misrepresentation or failure to supply information also leads to rejection from the award procedure.

The Commission’s Early Detection and Exclusion System provides the possibility to exclude entities linked to terrorist financing, terrorist offences or offences linked to terrorist activities from receiving EU funding following a contradictory and transparent proceeding.

For the Multiannual financial framework 2021-2027[3], the Commission has furthermore introduced a horizontal model grant agreement template, which requires that beneficiaries must respect basic EU values[4]. Beneficiaries established in third countries are also obliged to respect general principles including fundamental rights.

Lastly, all entities implementing EU funds must respect the provisions set out in EU restrictive measures[5] and thereby ensure that designated entities do not receive EU funding.

• [1] Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012, OJ L 193, 30.7.2018, p. 1.
• [2] Article 137 of the Financial Regulation establishes the obligation to declare and to provide evidence on the absence of exclusion situations.
• [3] https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv%3AOJ.LI.2020.433.01.0011.01.ENG&toc=OJ%3AL%3A2020%3A433I%3ATOC
• [4] Such as respect for human dignity, freedom, democracy, equality, the rule of law and human rights, including the rights of minorities.
• [5] Article 215 Treaty on the Functioning of the European Union.