Other criteria
Еligible Beneficiaries And Costs
Projects can either be organised as a separate activity block normally within the legal structure of the promoter / sponsor or can fall under a separate legal entity e.g. a Special Purpose Vehicle.
Investment in Projects will be made with eligible expenditures determined by the Structural Funds (“SF”) Regulations.
Excluded investments
- The creation and development of additional financial instruments, such as venture capital funds, loan funds or guarantee funds.
- Investment in projects in any of the sectors or linked to any of the activities specified in Article 1(2) of Regulation (EC) 800/2008, i.e. aid to export-related activities towards third countries or Member States, specifically: aid directly linked to the quantities exported, to the establishment and operation of a export-related distribution network or to the other current expenditure linked to export activity as well as aid contingent upon the use of domestic in preference to imported goods.
- Enterprises in the shipbuilding, coal, synthetic fibres and steel industry, as well as fisheries and agriculture.
- Undertakings subject to an outstanding recovery order following a previous EC decision declaring an aid illegal and incompatible with the internal market.
- Interest on debt, decommissioning costs of nuclear power plants and recoverable value-added tax.
Conditions for private co-investment
Private co-investments will either be in the form of equity or any other contribution whose repayment is at least partially subject to the Project’s economic success. Standard senior loans or investment amounts benefitting from guarantees or first loss clauses do not qualify as private co-investments.
Special conditions for co-investments by the Fund
Whenever investing own resources, the Fund will respect arm’s length principles and keep transparent records for reporting, monitoring and auditing purposes.
In case the Fund intends to invest its own resources on terms different from those applicable to the resources provided by JHFB, the conditions will be assessed by an independent еxpert. The same is true in cases when the Fund provides in-kind contribution as a co-investor to a Project, where the value of the contribution also has to be assessed by an independent expert.
Special conditions for co-investment at Project level
Article 78(6) of the Council Regulation (EC) No1083/2006 allows private or public co-financing to be effectively paid in cash or in kind at the level of urban Projects . According to the SF Regulations, private or public co-financing paid at the project level would only be eligible if complies with the following conditions:
- The Fund retains overall responsibility for the investment operation including subsequent monitoring of the contributions from the operational programme according to the funding agreement;
- The expenditure paid by such private or public entities is reported formally to the Fund which is responsible for verifying the reality and eligibility of the expenditure claimed; and
- The audit trail is maintained down to the level of the payment of private/public co-financing to the Projects.