1.   By 30 November of each year, each beneficiary Member State shall provide the European Investment Bank (EIB) and the Investment Committee with an overview of investments in respect of which it intends to submit investment proposals in the next two calendar years, as well as updated information on investments covered by any previous overview.

2.   In the overview referred to in paragraph 1, the beneficiary Member State shall provide the following information about each planned investment:

3.   The information included in the overview shall not be binding for the beneficiary Member State when submitting investment proposals in accordance with Article 4.

1.   Beneficiary Member States may submit investment proposals to the EIB and the Investment Committee at any time during a calendar year.

When submitting investment proposals, beneficiary Member States shall provide information specified in Annex I.

The beneficiary Member State shall indicate whether the proposal concerns a priority investment or a non-priority investment.

2.   Where an investment concerns a scheme, beneficiary Member State shall submit a proposal in accordance with paragraph 1 and specify the amount requested as the first disbursement for the scheme.

After the Commission has decided on the first disbursement to the scheme in accordance with Article 8(1), any subsequent disbursement shall require a separate proposal from the beneficiary Member State specifying the amount to be disbursed and containing the updated information about the scheme, as appropriate.

3.   Where the beneficiary Member State submits several investment proposals to be assessed in the same biannual disbursement cycle, it shall indicate a priority order for assessment of priority investments and a priority order for assessment of non-priority investments. If the Member State fails to indicate a priority order, the EIB or, as appropriate, the Investment Committee shall assess the proposals according to the dates of their submission.

4.   A proposal concerning a non-priority small-scale project may be submitted only as part of a scheme.

5.   The beneficiary Member State shall not request the financing from the resources of the Modernisation Fund of any costs of the investment which are financed by another Union or national instrument.

1.   Four weeks before the meeting of the Investment Committee referred to in Article 11(1), the EIB shall inform the beneficiary Member State, the Investment Committee and the Commission about the funds available to that Member State to finance investments from the Modernisation Fund (‘statement of the available funds’).

2.   The statement of the available funds shall specify the following:

3.   The closing date of the statement of the available funds shall be the last day of the calendar month preceding the date of transmission of information in accordance with paragraph 1.

4.   Without prejudice to paragraphs 1 to 3, the beneficiary Member State may request from the EIB information about the amount earmarked for that Member State held with the EIB at any given point in time.

1.   Investment proposals submitted by the beneficiary Member States as priority investments shall be assessed by the EIB in the first biannual disbursement cycle of the calendar year, if submitted at least six weeks before the first biannual meeting of the Investment Committee referred to in Article 11(1).

If submitted later than six weeks before the first biannual meeting of the Investment Committee referred to in Article 11(1), but at least six weeks before the second biannual meeting of the Committee, they shall be assessed in the second biannual disbursement cycle of the calendar year.

If submitted later than six weeks before the second biannual meeting of the Investment Committee referred to in Article 11(1), they shall be assessed in the first biannual disbursement cycle of the following calendar year.

2.   The EIB may request from the beneficiary Member State any information or documents that it considers necessary to assess the investment, provided that such information or documents are required by Annex I. The EIB shall request the information or documents without undue delay. If the beneficiary Member State provides the requested information or documents less than six weeks before the meeting of the Investment Committee referred to in Article 11(1), the EIB may postpone the assessment of the proposal to the next biannual disbursement cycle.

3.   If the EIB is of the opinion that the proposal concerns a non-priority investment, the EIB shall inform thereof the beneficiary Member State not later than within four weeks from submission of the proposal, and state the reasons for its conclusion. In that case, the proposal shall be assessed in accordance with the requirements and timelines specified in Article 7.

4.   If the proposal does not comply with Article 10d(1) of Directive 2003/87/EC or the requirements of this Regulation, the EIB shall return the proposal to the beneficiary Member State not later than within four weeks from submission of the proposal, and state the reasons for its conclusion. The EIB shall forthwith inform the Investment Committee.

5.   The assessment of the proposal shall include verification of the costs of the proposed investment, unless the proportionality of the amount of aid received has been verified by the Commission under the relevant State aid procedure.

6.   The EIB shall assess the proposal respecting the applicable Union law.

7.   The EIB may confirm the proposal as a priority investment provided that the following conditions are met:

8.   Where a proposal concerns a subsequent disbursement for a scheme confirmed by the EIB in accordance with paragraph 9 prior to the first disbursement, the assessment of the proposal by the EIB shall be limited to verification of the available funds in accordance with point (b) of paragraph 7, provided that there have been no changes to the scheme.

9.   The EIB shall decide on confirmation of the proposal as a priority investment at the latest two weeks before the meeting of the Investment Committee referred to in Article 11(1).

The EIB shall forthwith inform the beneficiary Member State concerned and the Commission about the decision referred to in the first subparagraph.

10.   At the latest one week before the meeting of the Investment Committee referred to in Article 11(1), the EIB shall inform the Committee about the investment proposals of each beneficiary Member State confirmed as priority investments in accordance with paragraph 9 of this Article and the amount to be disbursed to each investment.

1.   The investment proposals submitted by the beneficiary Member States as non-priority investments shall be assessed by the Investment Committee in the first biannual disbursement cycle of the calendar year, if submitted at least 10 weeks before the first biannual meeting of the Investment Committee referred to in Article 11(1).

If submitted later than 10 weeks before the first biannual meeting of the Investment Committee referred to in Article 11(1), but at least 10 weeks before the second biannual meeting of the Committee, they shall be assessed in the second biannual disbursement cycle of the calendar year.

If submitted later than 10 weeks before the second biannual meeting of the Investment Committee referred to in Article 11(1), they shall be assessed in the first biannual disbursement cycle of the following calendar year.

2.   At the latest two weeks before the meeting of the Investment Committee referred to in Article 11(1), the EIB shall complete a technical and financial due diligence assessment of the proposal, including an assessment of the expected emission reductions.

3.   The EIB may request from the beneficiary Member State any information or documents that it considers necessary to carry out the technical and financial due diligence assessment, provided that such information or documents are required by Annex I. The EIB shall request the information or documents without undue delay. If the beneficiary Member State provides the requested information or documents less than 10 weeks before the meeting of the Investment Committee referred to in Article 11(1), the EIB may postpone the completion of the due diligence assessment to the next biannual disbursement cycle.

4.   The financial due diligence assessment by the EIB shall include verification of the costs of the proposed investment, unless the proportionality of the amount of aid received has been verified by the Commission under the relevant State aid procedure.

5.   The EIB shall carry out the due diligence assessment respecting the applicable Union law.

6.   The due diligence assessment by the EIB shall be accompanied by a statement of the EIB representative regarding the endorsement of the financing of the investment proposal. The EIB shall forthwith transmit the due diligence assessment to the Investment Committee.

7.   The Investment Committee may issue a recommendation on financing the investment proposal provided that the following conditions are met:

8.   Where a proposal concerns a subsequent disbursement for a scheme recommended for the financing by the Investment Committee in accordance with paragraph 9 prior to the first disbursement, the proposal shall not require carrying out of due diligence assessment by the EIB, and the assessment of the proposal by the Committee shall be limited to verification of compliance with the requirements specified in points (b), (c) and (d) of paragraph 7, provided that there have been no changes to the scheme.

9.   The Investment Committee shall issue a recommendation on the investment proposal in the meeting referred to in Article 11(1), specifying the amount of the support from the Modernisation Fund, stating the reasons for its conclusion, and including any suggestions regarding appropriate financing instruments.

10.   If the Investment Committee does not recommend financing the investment, it shall state the reasons for its conclusion. In such case, the investment shall not be supported from the Modernisation Fund. The concerned Member State may revise the investment proposal taking into consideration the findings of the Investment Committee and it may submit a new investment proposal in any subsequent biannual disbursement cycle.

1.   After the meeting referred to in Article 11(1) of this Regulation, the Commission shall without undue delay adopt the decision referred to in Article 10d(3) of Directive 2003/87/EC specifying the amount of the resources from the Modernisation Fund to be disbursed to each investment confirmed as a priority investment by the EIB or recommended for the financing by the Investment Committee (‘disbursement decision’).

A decision concerning a disbursement of the resources from the Modernisation Fund to a scheme shall specify the amount of the first or any subsequent disbursement, as appropriate.

2.   The Commission shall notify the disbursement decision to the beneficiary Member States concerned, and it shall inform thereof the EIB and the Investment Committee.

1.   Subject to the documentary evidence provided by the beneficiary Member State in the annual report referred to in Article 13, an investment shall be deemed discontinued in either of the following cases:

Point (b) shall not apply to schemes.

2.   By the decision adopted in accordance with Article 8, the Commission shall modify the amount already disbursed for the discontinued investment by deducting any amount not yet paid by the beneficiary Member State to the project proponent or the scheme managing authority. Any such unpaid amount shall increase the resources in the Modernisation Fund available to the concerned Member State in accordance with Article 5(2)(b), and it shall be set off against any future payment by the EIB to the Member State concerned under Article 9.

3.   Without prejudice to paragraph 1 of this Article, prior to the closing date of the statement of the available funds referred to in Article 5(3), the beneficiary Member State may inform the Commission about a discontinued investment and request a modification of the disbursement decision in accordance with paragraph 2 of this Article. This request may concern the amounts not yet paid to the project proponent or the scheme managing authority and the amounts already paid to the project proponent or the scheme managing authority, but subsequently recovered by the beneficiary Member State. The beneficiary Member State shall provide the relevant documentary evidence justifying the request. Paragraph 2 of this Article shall apply to modification of the disbursement decision, the increase of the resources in the Modernisation Fund available to the concerned Member State, and the setting off of the amount returned to the Fund against any future payment by the EIB to the Member State.

1.   The Investment Committee shall meet twice a year, at the latest by 15 July and 15 December. The secretariat of the Investment Committee shall communicate the date of the meeting to the Member States as soon as that date becomes available.

2.   Unless the Committee issues a recommendation in accordance with the first and second sentence of the second subparagraph of Article 10d(7) of Directive 2003/87/EC, it shall be quorate if at least half of the representatives of the beneficiary Member States, all representatives of the non-beneficiary Member States and the representatives of the Commission and of the EIB are present.

3.   The non-beneficiary Member States shall elect three representatives in the Investment Committee in a vote comprising all candidates. Each non-beneficiary Member State may propose one candidate. The three candidates who received the largest numbers of votes shall be elected. If two or more candidates obtained the same number of votes and as a result, more than three candidates would be elected, the vote shall be resumed, comprising all candidates, except for the candidate(s) who received the highest number of votes, and if appropriate, the second highest number of votes.

4.   The members of the Investment Committee may not have financial or other interests in industries which qualify for the Modernisation Fund support, whether direct or indirect, which could affect their impartiality or may objectively be perceived as such. They shall act in the public interest and in an independent manner. They shall make a declaration of interests prior to taking up function in the Investment Committee, and they shall update their declarations whenever a relevant change occurs.

5.   The EIB shall provide administrative and logistic support to the Investment Committee (the secretariat), including support with the administration of a website dedicated to the Modernisation Fund.

6.   On a proposal from the competent Commission department, the Investment Committee shall establish its rules of procedure which shall, in particular, lay down procedures for the following:

7.   Members of the Investment Committee shall not receive any remuneration or reimbursement of costs for their participation in the activities of the Committee.

1.   The EIB shall develop asset management guidelines to manage the revenues from the Modernisation Fund, taking into account the objectives of Directive 2003/87/EC and the internal rules of the EIB.

2.   After consulting the Member States, the Commission shall enter into an agreement with the EIB laying down the specific terms and conditions under which the EIB shall perform its tasks in relation to implementation of the Modernisation Fund. Those terms and conditions shall cover the following tasks:

3.   The agreement referred to in paragraph 2 shall specify the mechanism for the recovery of the costs of the EIB for the performance of its tasks. The costs recovery mechanism related to confirmation of priority investments and carrying out of due diligence of non-priority investments shall take into account the number and complexity of proposals submitted by each beneficiary Member State. The costs of the EIB for the performance of its tasks shall be financed from the funds available to each beneficiary Member State as referred to in Article 5(2)(a). The EIB shall report to the Commission and to the Member States on the completion of the tasks under the agreement and the related costs.

1.   Beneficiary Member States shall monitor implementation of investments financed from the Modernisation Fund. By 30 April, beneficiary Member States shall submit to the Commission an annual report for the preceding year containing information specified in Annex II.

2.   The annual report referred to in paragraph 1 shall be accompanied by the following information:

1.   The annual report of the Investment Committee referred to in the first sentence of Article 10d(11) of Directive 2003/87/EC shall include the following information:

2.   On the basis of a draft prepared by the EIB, the Investment Committee shall adopt the final report for the preceding year by 15 March, and it shall forthwith submit it to the Commission.

1.   In the review referred to in the second sentence of Article 10d(11) of Directive 2003/87/EC, the Commission shall cover the following areas:

Based on the results of the review, the Commission shall, where appropriate, make the relevant proposals.

2.   At the end of the implementation of the Modernisation Fund, the Commission shall carry out a final evaluation of the implementation of the Modernisation Fund. In particular, the Commission shall evaluate the progresses towards the achievement of the Fund objectives as laid down in paragraphs 1, 2 and 3 of Article 10d of Directive 2003/87/EC.

3.   The Commission shall make the results of the review and evaluation publicly available.

1.   The EIB shall prepare annual accounts of the Modernisation Fund for each financial year, which shall run from 1 January to 31 December, taking into account the financial statements provided pursuant to Article 13(2)(b). Those accounts shall be subject to an independent external audit.

2.   The EIB shall submit to the Commission the following statements:

3.   The accounts and financial statements referred to in paragraphs 1 and 2 shall be drawn up in compliance with the International Public Sector Accounting Standards (IPSAS).

4.   The beneficiary Member States shall have the power to audit, on the basis of documents and on-the-spot checks, over all project proponents and scheme managing authorities, contractors and subcontractors to whom they provided support from the Modernisation Fund.

5.   For the purpose of paragraphs 1 and 2, beneficiary Member States, project proponents and scheme managing authorities, contractors and subcontractors who have received the resources from the Modernisation Fund shall keep available, for a period of five years following the last payment in respect of any project or scheme, all supporting documents and information regarding the payment or expenditure made.

6.   Beneficiary Member States shall take appropriate measures to ensure that, where activities financed under this Regulation are implemented, the financial interests of the Modernisation Fund are protected by the application of preventive measures against fraud, corruption and any other illegal activities, by effective checks and, if irregularities are detected, by the recovery of the amounts unduly paid and, where appropriate, by effective, proportionate and dissuasive administrative and financial penalties. Recoveries shall be implemented in accordance with the legislation of the beneficiary Member States.

For any amounts recovered, the beneficiary Member State shall request a modification of a disbursement decision in accordance with Article 10(3).

1.   The beneficiary Member States shall make publicly available on the websites of the relevant departments of their administrations information on the investments supported under this Regulation, in order to inform the public of the role and objectives of the Modernisation Fund. Such information shall include an explicit reference to the Modernisation Fund support received.

2.   The beneficiary Member States shall ensure that the final recipients of the Modernisation Fund support provide coherent, relevant and targeted information on the Modernisation Fund support received to multiple audiences, including the media and the public.

3.   The Modernisation Fund name shall be used for all communication activities and appear on notice boards at strategic places visible to the public.

4.   The beneficiary Member States and the Commission shall perform information, communication and promotion actions relating to the Modernisation Fund support and results. Such actions shall facilitate exchanges of experience, knowledge and best practices as regards the design, preparation and implementation of investments under the Modernisation Fund.

1.   Without prejudice to paragraph 2, the secretariat of the Investment Committee shall arrange for the publication on the Modernisation Fund website of the following information:

2.   Member States, the Commission and the EIB shall not disclose any commercially confidential information included in any document, information or other material submitted by them or by any third party in connection with implementation of the Modernisation Fund.