Disclaimer: The English language text below is provided by the Translation and Terminology Centre for information only; it confers no rights and imposes no obligations separate from those conferred or imposed by the legislation formally adopted and published. Only the latter is authentic. The original Latvian text uses masculine pronouns in the singular. The Translation and Terminology Centre uses the principle of gender-neutral language in its English translations. In addition, gender-specific Latvian nouns have been translated as gender-neutral terms, e.g. chairperson.

The Saeima¹ has adopted
and the President has proclaimed the following Law:

Management of Trans-European Network Projects Law

Chapter I
General Provisions

Section 1. Terms used in this Law

The following terms are used in this Law:

1) aid beneficiary - a recipient of the benefit created within the result of project implementation and the person responsible for project implementation, which is a direct or indirect State administrative institution, another State institution, a derived public person, a legal person registered in Latvia or an association of such persons, as well as an international organisation;

2) call for proposals of the European Commission - a competition of project applications announced by the European Commission for receipt of financing from the budget resources of trans-European networks;

3) implementing authority - an implementing body of a project, which is a direct or indirect State administrative institution, another State institution, a derived public person, a legal person registered in Latvia or an association of such persons, as well as an international organisation;

4) applicant of a project - a direct or indirect State administrative institution, another State institution, a derived public person, a legal person registered in Latvia or an association of such persons, as well as an international organisation;

5) project application - an application (a filled-in form and annexes thereto) for the receipt of financing necessary for a project from the budget resources of trans-European networks;

6) performer of a project - a natural person or a legal person or an association of such persons in any combination thereof who has acquired the right to provide services, to supply goods or to perform construction work for project implementation.

Section 2. Purpose of this Law

The purpose of this Law is to establish an efficient and transparent management of trans-European network projects in Latvia.

Section 3. Application of this Law

(1) Insofar as it is not specified by regulatory enactments of the European Union, this Law shall provide for the preparation, approval, implementation, as well as monitoring and control of implementation of transport and energy infrastructure projects co-financed from the budget resources of trans-European networks (hereinafter - project).

(2) Financial aid of the European Union for implementation of projects for the budget resources of trans-European networks shall be granted in accordance with Council Regulation (EC) No. 2236/95 of 18 September 1995 laying down general rules for the granting of Community financial aid in the field of trans-European networks [amended by Regulation (EC) No. 1655/1999 of the European Parliament and of the Council of 19 July 1999, Regulation (EC) No. 807/2004 of the European Parliament and of the Council of 21 April 2004 and Regulation (EC) No. 1159/2005 of the European Parliament and of the Council of 6 July 2005] [hereinafter - Regulation (EC) No. 2236/95].

(3) This Law shall be applied to projects that are submitted for approval to the European Commission by 31 December 2013.

(4) This Law shall not be applied to telecommunications projects.

Chapter II
Authorities Involved in Project Management and Functions Thereof in Project Implementation

Section 4. Managing Authority

(1) The managing authority shall ensure the fulfilment of duties of a Member State specified in Regulation (EC) No. 2236/95.

(2) The functions of the managing authority shall be performed by:

1) the Ministry of Transport - for projects in the transport sector; and

2) the Ministry of Economics - for projects in the energy sector.

(3) The managing authority shall determine an official responsible for the fulfilment of the functions of the managing authority.

(4) The managing authority shall perform the following functions:

1) ensure administrative management of acquisition of the budget resources of trans-European networks, monitoring and control of project implementation, as well as co-ordination of work of the authorities involved in the project management and co-operation thereof with the European Commission;

2) publish calls for proposals of the European Commission, accept and evaluate project applications and submit them for approval at the European Commission;

3) evaluate the prepared proposals regarding amendments to a decision of the European Commission and submit them for approval at the European Commission;

4) ensure examination of reviews and reports on project implementation, requests for interim and final payments and submission thereof to the European Commission;

5) plan project financing according to the cash flow in an individual State budgetary programme;

6) prepare payment orders for the implementing authority or the aid beneficiary for carrying out of payments within the framework of a project and submit them to the paying authority;

7) prepare proposals for amendments to regulatory enactments of Latvia in order to ensure the conformity of these regulatory enactments to the regulatory enactments of the European Union and improve the procedures for the management, monitoring and control of projects; and

8) organise information and publicity measures regarding utilisation of the budget resources of trans-European networks granted to the State.

(5) The Cabinet shall determine the criteria for evaluation of project applications and requirements to applicants of projects, the procedures, by which calls for proposals of the European Union are published, project applications are accepted, evaluated and submitted for approval at the European Commission, as well as how the prepared proposals regarding amendments to decisions of the European Commission are evaluated and submitted for approval at the European Commission.

(6) If the managing authority is the aid beneficiary, it shall evaluate the project application and submit a corresponding project application to the European Commission. The managing authority shall ensure separation of implementation and control functions of the project in the authority during implementation of the project.

Section 5. Paying Authority

(1) The functions of the paying authority shall be performed by the Treasury.

(2) The paying authority shall perform the following functions:

1) open an account for the managing authority at the Treasury for receipt of budget resources of trans-European networks from the European Commission;

2) receive budget resources of trans-European networks from the European Commission and perform accounting thereof in the account of the managing authority;

3) on the basis of the payment orders submitted by the managing authority to the implementing authority or the aid beneficiary, make payments within the scope of the project and ensure issuance of account statements; and

4) on the basis of the payment orders issued by the managing authority, reimburse to the European Commission the non-acquired and inappropriately used budget resources of trans-European networks.

Section 6. Aid Beneficiary

The aid beneficiary shall ensure the fulfilment of conditions of a decision of the European Commission and perform the following functions:

1) ensure recording of the benefits created during project implementation in accounting thereof;

2) ensure rational utilisation of the benefits created during project implementation and maintenance thereof according to the requirements, which are specified in the regulatory enactments of Latvia and the European Union in the budgetary and financial sector;

3) where appropriate, prepare and submit proposals regarding amendments to a decision of the European Commission for evaluation at the managing authority;

4) control the process of introduction of a project, perform an examination at the place of project implementation and document them;

5) inform the managing authority regarding measures, which have been taken in order to prevent the deficiencies detected in examinations of all levels in project implementation;

6) inform the managing authority without delay regarding non-conformities detected during project implementation and regarding measures for prevention thereof;

7) prepare and submit reports and reviews to the managing authority in accordance with the conditions of a decision of the European Commission and the contract referred to in Section 8, Paragraph one of this Law;

8) submit a description of the management and internal control system of the project, as well as a list of persons responsible for the project management and contact information thereof to the managing authority;

9) organise a procurement procedure for the needs of project implementation in cases and in accordance with the procedures specified in regulatory enactments;

10) enter into a contract with a performer of a project regarding the provision of services, supply of goods or construction work and make payments pursuant to the provisions of the procurement contract;

11) ensure examination of payment documents submitted by a performer of a project (regarding the amount and quality of service received, goods supplied and construction work performed and other provisions of the procurement contract); and

12) organise information and publicity measures regarding project implementation.

Section 7. Implementing Authority

If the implementing authority is not the aid beneficiary, then upon entering into a contract regarding project implementation, the aid beneficiary may transfer the functions specified in Section 6 of this Law to the implementing authority.

Section 8. Co-operation in Performance of Functions of Authorities

(1) The managing authority shall enter into a contract with the aid beneficiary or the implementing authority regarding the procedures for implementation and monitoring of a project.

(2) The aid beneficiary shall submit a copy of the contract referred to in Section 7 of this Law to the managing authority.

Chapter III
Submission, Co-ordination and Approval of Project Applications

Section 9. Submission of a Project Application

(1) An applicant of a project shall prepare and submit a project application to the managing authority in accordance with the provisions of this Law and other regulatory enactments.

(2) An applicant of a project shall provide for the co-financing necessary for implementation of the project from his or her own resources.

Section 10. Co-ordination of Project Applications

(1) The managing authority shall evaluate a project application and take a decision regarding submission of the project application for approval at the European Commission or regarding refusal thereof.

(2) If a project application is incomplete, the managing authority shall prepare an opinion regarding the project application and shall send it to the applicant of the project. The applicant of the project may adjust the project application in writing once and re-submit it to the managing authority within the period of time indicated in the opinion. Adjustment of the project application shall be regarded as hearing of the applicant of the project.

(3) A legal person registered in Latvia or an association of such persons, as well as an international organisation may appeal the decision referred to in Paragraph one of this Section in accordance with the procedures specified in the Administrative Procedure Law. The appeal of the decision shall not suspend the operation of the decision. The opinion referred to in Paragraph two of this Section shall not be regarded administrative act, and it may not be contested or appealed.

Section 11. Approval of a Project Application

(1) The managing authority shall inform an applicant of a project regarding objections and comments of the European Commission in relation to a project application within a time period of five working days after the document has been received from the European Commission.

(2) An applicant of a project shall co-ordinate any amendments to a project application after submission thereof to the European Commission with the managing authority.

Chapter IV
Control and Audit of Project Implementation

Section 12. Control of Project Implementation

(1) The managing authority shall ensure the control of project implementation and perform:

1) examinations at the place of project implementation;

2) audit of the conformity and efficiency of the internal control systems of the authorities involved in project implementation; and

3) examination of documents for request of interim and final payment and certification of expenditure and submit the referred to documents to the European Commission.

(2) A unit of the managing authority, which is not directly involved in project implementation, making of payments and performing of the examinations referred to in Paragraph one, Clauses 1 and 3 of this Section, shall perform the audit referred to in Paragraph one, Clause 2 of this Section.

(3) The managing authority is entitled to request entering into a contract regarding performance of an independent audit for approval of conformity of project expenditure, providing for it in the contract of co-operation with the aid beneficiary or the implementing authority.

(4) The aid beneficiary shall submit the contract referred to in Paragraph three of this Section together with documents for request of payments to the managing authority.

(5) The Cabinet shall determine the procedures, by which the authorities involved in the project management provide information regarding violations and non-conformities detected in the project implementation, as well as refund non-conforming expenditure carried out within the scope of the project.

Section 13. Audit of Project Implementation

(1) The managing authority, the State Control, the European Commission, the European Court of Auditors and the European Anti-Fraud Office may perform examination of project implementation.

(2) The managing authority, the implementing authority, the aid beneficiary and the performer of a project shall:

1) present the documents related to project implementation to the auditors;

2) ensure access to documentation regarding financial resources, other material values and premises, if the referred to documentation is related to the audit to be performed;

3) prepare extracts and copies of the necessary documents; and

4) provide auditors with explanations regarding the preparation, implementation and monitoring of the project.

(3) During project implementation the managing authority has the right to invite a third party for performance of an independent audit in order to ascertain regarding adequate project implementation. The aid beneficiary or the implementing authority shall cover the expenditure of the independent audit from their resources if, in performing an audit, non-conformities, which have occurred due to action or inaction of the aid beneficiary or the implementing authority, are detected in the project implementation.

Section 14. Storage of Project Documentation

All authorities involved in the implementation of a project shall store the documents that are related to the preparation and implementation of the project, in accordance with the requirements regarding period of storage of documents, which is specified in the regulatory enactments of Latvia and decision of the European Commission.

Transitional Provision

The Cabinet shall issue the regulations referred to in Section 4, Paragraph five and Section 12, Paragraph five of this Law by 31 December 2007.

This Law shall come into force on 1 May 2007.

This Law has been adopted by the Saeima on 4 April 2007.

President V. Vīķe-Freiberga

Rīga, 25 April 2007

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¹ The Parliament of the Republic of Latvia

Translation © 2008 Tulkošanas un terminoloģijas centrs (Translation and Terminology Centre)