1 INCREASING KNOWLEDGE, AWARENESS, TRANSPARENCY AND TRACEABILITY FOR RESPONSIBLE VALUE CHAINS IN THE COTTON AND GARMENT SECTORS
Global Public Goods and Challenges: Human Development – including decent work and social justice
"The European Union (EU) is one of the world’s largest consumer markets. For this reason, the EU is striving to ensure that European consumers and businesses make informed purchases and support products that meet the highest possible environmental and social requirements. The EU is strongly committed to eradicating poverty and implementing the 2030 Agenda for Sustainable Development. This includes working towards a fairer global fashion industry. It should be possible to have more transparent, responsible and sustainable global supply chains. This is a joint responsibility of governments, businesses, and citizens." 4
Global value chains5 are characterised by the different production stages in different countries. The significance of global value chains raises the question of how to ensure their sustainable management. Achieving sustainable production and consumption and decent work are among key objectives under the Sustainable Development Goals (SDGs) in the context of the 2030 Agenda for Sustainable Development.6 The aim is to ensure that economic growth and development go hand in hand with social justice and environmental protection, including for those sectors characterised by particularly complex and fragmented production networks.
The garment value chain is considered one of the most complex production models globally. It is an important industry in economic terms, both within the EU and in partner countries, providing employment opportunities to millions of workers, especially young women.7 However, particularly in low-income production countries the industry is often characterised by prevalent and persistent structural problems linked to the fragmentation of labour-intensive, low-skill production across many factories and international locations. Due to the scale and the profile of workers, the sector has great potential to significantly contribute to economic and social development. Nevertheless, the sector presents vast sustainability challenges and high risks like poor working conditions, lack of social protection, limited freedom of association and collective bargaining, unsafe workplaces, child labour, forced labour and environmental damage such as water pollution.
Textiles and garments belong to the most globalised industries which are connected by strong upstream and downstream linkages. In simplistic terms, the complex sourcing model spans from fibres (raw materials), yarns (spinning), fabrics (weaving and knitting, etc.) and finished fabrics (dying and printing, etc.), garments/clothing (cutting, sewing, trimming, ironing, etc.), to final consumer (retailing and branding), and supporting activities such as insurance, logistics, packaging, labelling, marketing, etc.
On the one hand, the textile industry involves research, design, development, manufacturing and distribution of yarn, textiles, and fabrics. It comprises different products based on natural or synthetic fibres. On the other hand, the more downstream labour intensive garment sector, also referred to as apparel or fashion/clothing industry, more narrowly concerns the production and life cycle of garments. It is driven by large buyers, such as manufacturers, retailers and brands, setting up multi-layered, decentralised sourcing and production networks across a variety of countries, often located in the developing world. The multiple levels of sub-contracting often further hamper efforts to control the working conditions of production. These elements justify the need to improve transparency and traceability across the value chain.
Development cooperation can serve as a vehicle for comprehensive engagement with the private sector along the value chain, and contribute to wider EU efforts on promoting responsible business conduct, investment, and decent work.
Increasing the transparency in the value chain – disclosing information to the public in a comprehensible, accessible, and timely manner – and the traceability – the process by which enterprises track materials and products and the conditions under which they were produced through the supply chain - is considered a major stepping stone to improve sustainable business practices and working conditions in producing countries.
In addition to the European Commission support to the enforcement and implementation of the international labour and environmental standards the Council also adopted Conclusions on The EU and Responsible Global Value Chains8 recognising their complexity and "strongly encouraged the Commission and Member States to share best practices, including the promotion of new and innovative approaches, and to scale up such initiatives and expedite their delivery."
The 2016 Council Conclusions on Child Labour9 stress the need to link EU actions with responsible business conduct. In the 2016 Conclusions on Business and Human Rights 10 the Council "underlines the critical role of business transparency in enabling markets to recognise, incentivise and reward respect for human rights by companies".
On 24 April 2017 the European Commission published the Staff Working Document Sustainable garment value chains through EU development action11 presenting an overview of the complex garment sector and the challenges it faces, and outlining a strategy for an effective EU development cooperation response to capacity building, awareness raising and technical assistance needs with a view to capitalising on opportunities and addressing key challenges.
The Staff Woking Document focuses on three priorities:
- economic empowerment of women, which are 75 % of garment workers; - decent work and living wages;
- transparency and traceability in the value chain.
Transparency is particularly important due to the fragmented production of the sector and the widespread practice of subcontracting. Informal work is an additional challenge related to decent work deficits, identification difficulties and lack of transparency. Better transparency and traceability in the value chain are likely to improve the efficient and sustainable use of resources, contribute to sustainable production and consumption. Traceability is indeed considered one essential step for companies in performing due diligence throughout their global supply chains.
The EU will focus its development cooperation and financial support to improve sustainable business practices and working conditions in producing countries, promote best practices for social and
environmental standards, and reach out to consumers to raise awareness about how clothes are made and promote responsible choices. However, all stakeholders need to be committed to sustainable value chains and take appropriate actions to maximise the sector's potential.
With the recent adoption of the Council Conclusions on Sustainable Garment Value Chains12 the Council supports the promotion of responsible supply chains in the textile and clothing sector recognising the potential of this sector as a driver of development and emancipation, but also acknowledging the economic, social and environmental challenges posed by the garment value chains.
Deadly accidents such as the collapse of the factory in Rana Plaza in Bangladesh in 2013 underline the importance of preventing human rights violations and of promoting corporate social responsibility in the garment sector. In this context the consumer information tools and CSR/RBC are encouraged with the promotion of social and environmental best practices by fostering collaboration and knowledge sharing between stakeholders.
The Council encourages strengthening efforts to raise awareness of consumers and public procurers to promote sustainable and responsible consumption. The Council stresses the importance of tracking the chemicals used in the garment sector and present in the final products and promotes sustainable and resource efficient production, including the promotion of non-toxic material cycles to achieve a circular economy and ensure more reuse and recycling in the garment sector avoiding a health threatening exposure of workers to harmful and toxic substances.
The Council encourages actions to increase transparency and traceability in garment supply chains including sustainability information by companies in their reporting and consumer awareness of such information.
The European Parliament supports this initiative as defined in the adopted Resolution13 "whereas transparency and traceability are prerequisites for a company’s accountability and responsible consumption; whereas the consumer has the right to know where a piece of clothing was produced and under what social and environmental conditions; whereas guaranteeing consumers the right to reliable, transparent and relevant information on the sustainability of production will help to bring about lasting change in supply chain traceability and transparency in the garment sector" and "calls on the Commission to further address ... key criteria for sustainable production, transparency and traceability, ...".
The EU’s intention is to support the decent work and transparency/traceability objective under the Commission's work on responsible garment value chains. The programme concerns the whole garment value chain; thus, relevant actors and target groups are to be found in non-EU producing countries and also in Europe such as producers, importers, retailers and consumers.
1.2 OBJECTIVES OF THE PROGRAMME AND PRIORITY ISSUES
The programme covered by this call for proposals is part of the action entitled Promoting responsible value chains in the garment sector with a focus on Decent Work and Transparency/Traceability funded under the thematic programme Global Public Goods and Challenges of the Development Cooperation Instrument for the area of Human development, including decent work and social justice.
The programme will address labour rights in the garment sector taking a value chain approach, including the lower segments of chain, for a comprehensive action to promote labour and environmental standards and to reduce labour rights abuses.
It will cover decent work and sustainability agenda, promote knowledge and awareness on social and environmental conditions and support global advocacy.
It will also aim at improving transparency and traceability to tackle issues linked to subcontracting, informal work, or complex and multi-layered value chains, thereby contributing to application of due diligence principles and sustainability schemes.
The programme will contribute to strengthen multi-stakeholder collaboration between governments, non- state actors including consumers' groups and industry and business associations.
The global objective of this call for proposals is:
To improve working conditions, promote labour and environmental standards and reduce labour rights abuses in the cotton and garment sector value chains. The specific objectives of this call for proposals are:
- improving knowledge, awareness and advocacy on social and environmental conditions to promote responsible production and consumption
- enhancing and up-scaling voluntary transparency and traceability schemes through existing multi- stakeholder initiatives to support sustainable and responsible production.
Strengthening knowledge, awareness, and advocacy on social and environmental conditions in the cotton and garment value chains
It will contribute to strengthen a common understanding and to improve knowledge of sustainable global value chains in the garment sector, in line with internationally agreed standards, principles and guidelines:
- International Labour Standards (ILS)
- Corporate Social Responsibility (CSR)14
- Relevant multilateral environmental agreements
It will also contribute to raise awareness of consumers and to translating awareness into more responsible buying behaviour. It will also contribute to support all stakeholders already active in the area, in particular civil society organisations and trade unions to enhance their capacities for evidence-based global advocacy on social and environmental conditions, with a specific focus on labour standards.
Enhancing transparency and traceability in the cotton and garment value chains
It will contribute to support businesses operating in the garment industry, including European industry in improving transparency and traceability systems within all stages of the value chains such as:
- understanding of value chains actors and social and environmental impact in the different tiers,
- identification of location and conditions of production.
It will also contribute to enhance the effectiveness of sustainability schemes and the application of due diligence principles on labour and environmental standards including mitigation of risks.
This could include scaling up the use of innovative advanced tracking through the use of new technologies, and voluntary verification/documentation systems. It will enhance businesses' due diligence efforts, thus promoting responsible production, and better ensuring sustainability in the cotton/garment sector in terms of human rights, decent work and environment. It will enhance existing multi-stakeholder initiatives involving partners (brands, buyers, suppliers, etc) throughout the whole garment value chain.
Geographical balance will be taken into account by the European Commission at any stage of the technical evaluation.
1.3 FINANCIAL ALLOCATION PROVIDED BY THE CONTRACTING AUTHORITY
The overall indicative amount made available under this call for proposals is EUR 5 500 000. The Contracting Authority reserves the right not to award all available funds. Equally, this amount could be increased in future should more funds become available.
Indicative allocation of funds by lot:
Lot 1: EUR 3 500 000
Lot 2: EUR 2 000 000
If the allocation indicated for a specific lot cannot be used due to insufficient quality or number of proposals received, the Contracting Authority reserves the right to reallocate the remaining funds to the other lot.
Size of grants
Any requested EU contribution under this call for proposals must fall between the following minimum and maximum amounts:
minimum amount: EUR 500 000
minimum amount: EUR 500 000
Any requested EU contribution under this call for proposals must fall between the following minimum and maximum percentages of total eligible costs of the action:
Minimum percentage: 50% of the total eligible costs of the action
Maximum percentage: 80 % of the total eligible costs of the action (see also section 2.1.5) In case the Lead Applicant or one Co-Applicant is a private sector entity:
Minimum percentage: 20% of the total eligible costs of the action
As per section 6.3.10. of the Practical Guide, the grant must not give rise to profits for neither the Beneficiaries (Coordinator/lead applicant and co-beneficiaries/co-applicants) nor any affiliated entity (in the context of this call, profit is defined as a surplus of the receipts over the eligible costs approved by the Contracting Authority when the request for payment of the balance is made). Expected revenue of the action may be accepted as co-financing. However, action revenues in excess of the total costs will be considered as profit. As such, it will need to be deducted when calculating the final amount of the EU grant.
The balance (i.e. the difference between the total cost of the action and the amount requested from the Contracting Authority) must be financed from sources other than the European Union Budget or the European Development Fund15.
The requested EU contribution may cover the entire eligible costs of the action if this is deemed essential to carry it out. If that is the case, the lead applicant must justify full financing in Annex A.2, section 2.1. The validity of the justification provided will be examined during the evaluation procedure. If the evaluation committe considers that the justification is not valid, only the maximum percentage allowed (80% or 50%) will be accepted.
The absence of any justification may lead to the rejection of the application.
Therefore the lead applicant can either ask for a maximum percentage of 80% (or 50%) or for 100% (under the conditions described above).A percentage between 80.01% (or 50.01% ) and 99.99% is not allowed.
2 RULES FOR THIS CALL FOR PROPOSALS
These guidelines set out the rules for the submission, selection and implementation of the actions financed under this call, in conformity with the Practical Guide, which is applicable to the present call (available at http://ec.europa.eu/europeaid/prag/document.do?locale=en) 16.
2.1 ELIGIBILITY CRITERIA
There are three sets of eligibility criteria, relating to: (1) the actors:
The lead applicant, i.e. the entity submitting the application form (2.1.1),
if any, its co-applicant(s) (where it is not specified otherwise the lead applicant and its co-applicant(s) are hereinafter jointly referred as "applicant(s)") (2.1.1),
(2) the actions:
(3) the costs:
(1) In order to be eligible for a grant, the lead applicant must:
be a legal person and
be a specific type of organisation such as: civil society organisation17, including non- governmental non-profit organisations, independent political foundations, community-based organisations, private sector entities, institutions, organisations, networks thereof at local, national, regional or international level, business associations, employers' associations, workers' association, consumers' associations, social partners, academia, research institutes, media, multi- stakeholder initiatives actives in the area of this call, and
be established in18 (see Annex O).
for Lot 1
for Lot 2
at least 2 years of specialised expertise related to responsible value chain management in the cotton/garment sector, and
at least 2 years' experience with private sector engagement to improve social and environmental standards in the cotton/garment value chains; and
track record of at least 2 years' work on certification/standardisation and tracking systems on sustainability criteria
(2) Potential applicants may not participate in calls for proposals or be awarded grants if they are in any of the situations listed in section 2.3.3 of the Practical Guide.
In Annex A.2, section 5 (‘declaration by the lead applicant’), the lead applicant must declare that the lead applicant himself, the co-applicant(s) and affiliated entity(ies) are not in any of these situations.
The lead applicant must act with at least one co-applicant as specified hereafter.
If awarded the grant contract, the lead applicant will become the beneficiary identified as the Coordinator in Annex E3h1 (Special Conditions). The Coordinator is the main interlocutor of the Contracting Authority. It represents and acts on behalf of any other co-beneficiary (if any) and coordinate the design and implementation of the action.
The lead applicant must act with at least one co-applicant as specified hereafter. Co-applicants participate in designing and implementing the action, and the costs they incur are eligible in the same way as those incurred by the lead applicant.
Co-applicants must satisfy the eligibility criteria as applicable to the lead applicant; except the specific experience described above.
In addition to the categories referred to in section 2.1.1, the following are however also eligible:
Public sector operator, local authority 19
International (inter-governmental) organisation as defined by Article 43 of the Rules of
application of the EU Financial Regulation20
Please note that all information encoded in PROSPECT must be exhaustive and in line with the content of the concept note. The administrative check will be performed taking into consideration only the information available in sections 1 - contact, 2 - project and 3 – co- applicants. Please make sure that there are no inconsistencies between the information in PROSPECT and those in the concept note text.
Co-applicants must sign the mandate in Annex A.2., section 4.
If awarded the grant contract, the co-applicant(s) (if any) will become beneficiary(ies) in the action (together with the Coordinator).
The lead applicant and its co-applicant(s) may act with affiliated entity(ies)
Only the following entities may be considered as affiliated entities to the lead applicant and/or to co-applicant(s):
Only entities having a structural link with the applicants (i.e. the lead applicant or a co-applicant), in particular a legal or capital link.
This structural link encompasses mainly two notions:
(i) Control, as defined in Directive 2013/34/EU on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings:
Entities affiliated to applicant may hence be:
- Entities directly or indirectly controlled by an applicant (daughter companies or first-tier subsidiaries). They may also be entities controlled by an entity controlled by an applicant (granddaughter companies or second-tier subsidiaries) and the same applies to further tiers of control;
- Entities directly or indirectly controlling the applicant (parent companies). Likewise, they may be entities controlling an entity controlling the applicant;
- Entities under the same direct or indirect control as the applicant (sister companies).
(ii) Membership, i.e. the applicant is legally defined as a e.g. network, federation, association in which the proposed affiliated entities also participate or the applicant participates in the same entity (e.g. network, federation, association) as the proposed affiliated entities.
The structural link shall as a general rule be neither limited to the action nor established for the sole purpose of its implementation. This means that the link would exist independently of the award of the grant; it should exist before the call for proposals and remain valid after the end of the action.
By way of exception, an entity may be considered as affiliated to an applicant even if it has a structural link specifically established for the sole purpose of the implementation of the action in the case of so- called “sole applicants” or “sole beneficiaries”. A sole applicant or a sole beneficiary is a legal entity formed by several entities (a group of entities) which together comply with the criteria for being awarded the grant. For example, an association is formed by its members.
What is not an affiliated entity?
The following are not considered entities affiliated to an applicant:
- Entities that have entered into a (procurement) contract or subcontract with an applicant, act as concessionaires or delegatees for public services for an applicant,
- Entities that receive financial support from an applicant,
- Entities that cooperate on a regular basis with an applicant on the basis of a memorandum of understanding or share some assets,
How to verify the existence of the required link with an applicant?
The affiliation resulting from control may in particular be proved on the basis of the consolidated accounts of the group of entities the applicant and its proposed affiliates belong to.
The affiliation resulting from membership may in particular be proved on the basis of the statutes or equivalent act establishing the entity (network, federation, association) which the applicant constitutes or in which the applicant participates.
If the applicants are awarded a grant contract, their affiliated entity(ies) will not become beneficiary(ies) of the action and signatory(ies) of the grant contract. However, they will participate in the design and in the implementation of the action and the costs they incur (including those incurred for implementation contracts and financial support to third parties) may be accepted as eligible costs, provided they comply with all the relevant rules already applicable to the beneficiary(ies) under the grant contract.
Affiliated entity(ies) must satisfy the same eligibility criteria as the lead applicant and the co-applicant(s).
They must sign the affiliated entity(ies) statement in Annex A.2., section 5.
2.1.3 Associates and Contractors
The following entities are neither applicants nor affiliated entities and do not have to sign the "mandate for co-applicant(s)" or "affiliated entities' statement":
Other organisations or individuals may be involved in the action. Such associates play a real role in the action but may not receive funding from the grant, with the exception of per diem or travel costs. Associates do not have to meet the eligibility criteria referred to in section 2.1.1. Associates must be mentioned in Annex A.2., section 6 — ‘Associates participating in the action’.
The beneficiaries and their affiliated entities are permitted to award contracts. Associates or affiliated entity(ies) cannot be also contractors in the project. Contractors are subject to the procurement rules set out in Annex IV to the standard grant contract.
2.1.4 Eligible actions: actions for which an application may be made
An action is composed of a set of activities.
The initial planned duration of an action may not be lower than 12 months nor exceed 48 months.
Sectors or themes
Specific sectors or themes for both lots to which the actions must relate, this list is not exhaustive.
Cotton and Garment value chains including all tiers (fields, home settings, farms, factories, retailers, etc) such as:
o seeds and cotton production, such as picking, ginning, weaving, spinning; other raw materials for garment and accessories production ;
o textile production: dying, printing, trimming
o clothing and accessories production, including footwear: cutting, sewing, ironing, branding,
Decent work agenda including:
o working conditions, living wages, labour rights, labour standards, occupational health and safety including harmful impact of hazardous chemicals and health protection,
o child labour, forced labour, modern slavery, human trafficking
o gender equality, women economic empowerment Environmental standards including
o sustainable use of resources and water,
o energy and waste management, ,
o reusing and/or recycling of clothing and accessories
Due diligence, corporate social responsibility, responsible production and consumption, raising consumers' awareness and behaviour.
Actions must take place in one or more countries eligible under the Development Cooperation Instrument (DCI) and/or in one or more Member States of the EU (see Annex O).
The actions in the Member States of the EU must clearly show the link and the impact in DCI countries and target actors in DCI countries.
Geographical balance will be taken into account by the European Commission at any stage of the technical evaluation.
Types of action for both lots
Types of action which may be financed under this call, this list is not exhaustive: - mapping and gap analysis of existing multi-stakeholder and industry initiatives;
- tools for industry initiatives to map, improve transparency and disclose information on all value chains actors, location and conditions of production, including social and environmental impact, to improve, traceability with their value chains (in particular for SMEs) and mitigate risks related to the levels of labour and environmental standards applied,
- support for multi-stakeholder forums to share knowledge and strengthen alliances;
- reinforcing existing multi-stakeholder initiatives (including initiatives by non-state actors and garment industry stakeholders) to improve labour and environmental standards; and to enhance collaboration among them to prepare the ground for alignment or harmonisation of actions and practices in the in the garment and cotton value chain;
- research on effectiveness of communications campaigns in awareness raising, practice and behaviour;
- monitoring, documentation and dissemination of good practices in due diligence, corporate social responsibility and social partners' and other stakeholders' interventions;
- advocacy, awareness raising, training, technical assistance and tools;
- improving due diligence, corporate social responsibility, transparency and traceability to mitigate risks of labour and environmental abuses;
- scaling up industry-led best practice traceability mechanisms and advanced tracking efforts;
- actions contributing to facilitate further efforts from private sector actors, particularly by supporting collaboration between them and between the European Commission and private sector.
More specifically for each lot:
- Raising awareness of consumers and public procurers to promote improved sustainable and responsible consumption and value chains
- Improving information to consumers on where, how and by whom clothes are made; disclosing information to the public in a comprehensible, accessible and timely manner
- Promoting consumer information tools and CSR/RBC including due diligence carried out by companies in their supply chains
- Promoting and disseminate social and environmental best practices on responsible management of garment value chains by engaging with companies, business associations, CSOs, social partners and by fostering collaboration and knowledge sharing between stakholders
- Supporting civil society organisations and trade unions to enhance their capacities for evidence-based global advocacy on social and environmental conditions, with a specific focus on labour standards.
- Policy and advocacy work by setting up a collaborative platform at EU level
- Outreach to producing countries at various tiers of the chains
- Reinforcing existing effective and scalable multi-stakeholder initiatives to improve labour and
- Enhancing transparency and traceability systems within value chains (value chains actors, location and conditions of production, social and environmental impact at all stages, etc.)
- Contributing to improve information and to support businesses operating in the garment industry including European industry, to apply more effectively due diligence principles on social responsibility, labour and environmental standards;
- Scaling up the use of innovative voluntary tracking verification/documentation systems is in a collaborative effort involving garment companies/brands and existing multi-stakeholder initiatives with expertise and ongoing work in this area;
- Building capacity of garment suppliers, producers, intermediaries of different tier levels to better respond to transparency and traceability needs and requirements, including transfer of know-how, use of new technologies;
- Scaling up industry-led best practice traceability mechanisms and advanced tracking efforts in the sector, e.g. exploring possibilities for putting in place simple, compatible, and voluntary traceability tools for assessing environmental and social sustainability throughout the value chain (mass market);
- Building on existing, effective and widely-accepted and adopted schemes, and involving various stakeholders (public, private, CSOs, trade unions, etc.) from major garment producing countries exporting to the EU.
- Promoting the integration of sustainability information into companies reporting and building relations with their customers
The following types of action are ineligible:
actions concerned only or mainly with individual sponsorships for participation in workshops, seminars, conferences and congresses;
actions concerned only or mainly with individual scholarships for studies or training courses;
once-off conferences: conferences may only be funded if they form part of a wider range of activities to be implemented over the life-time of the action. For this purpose, preparatory activities for a conference and the publication of the proceedings of the conference do not, in themselves, constitute such "wider Activities;
actions which consist exclusively or primarily in capital expenditure, e.g. land, buildings, equipment and vehicles;
Types of activity for both lots
The indicative and non-exhaustive list of activities which may be financed under this call: - Awareness raising and consumer campaigning activities
- Multimedia activities and campaigns
- Outreaching to producing countries on selected topics
- Networking, exchange of best practices and experience and related policy advocacy
- Setting up collaborative platforms
- Research activities, data collection, surveys
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- Development of innovative technical tracking and traceability tools, including using digital and new technologies such as tracking chemicals used in the garment sector and present in the final garment products, natural fibres, all wastes and resources in the garment sectors
- Promotion of non-toxic material cycles needed to achieve a circular economy and ensure more reuse and recycling in the garment sector
- Promotion of safe work environments to avoid threatening exposure of workers to harmful and toxic substances and other hazardous works
- Training, manuals, workshops and seminars with multi-stakeholder initiatives to harmonize actions and build synergies
- Accompanying capacity building activities
- Fostering transfer of know-how and adoption of new technologies
- Technical assistance
- Policy dialogue and collaboration with local public sector and decision makers
- Tracking of policy implementation and results; facilitation of policy dialogue among diverse stakeholders
Financial support to third parties21
Applicants may propose financial support to third parties in order to help achieving the objectives of the action.
The maximum amount of financial support per third party is EUR 60 000
Under this call, financial support to third parties may not be the main purpose of the action.
In compliance with the present guidelines and notably of any conditions or restrictions in this section, the lead applicant should define mandatorily in section 2.1.1 of the grant application form:
(i) the objectives and results to be obtained with the financial support
(ii) the different types of activities eligible for financial support, on the basis of a fixed list
(iii) the types of persons or categories of persons which may receive financial support
(iv) the criteria for selecting these entities and giving the financial support
(v) the criteria for determining the exact amount of financial support for each third entity, and
(vi) the maximum amount which may be given.
(vii) the system of control set up to verify the eligibility of costs
In all events, the mandatory conditions set above for giving financial support (points (i) to (vii)) have to be strictly defined in the grant contract as to avoid any exercise of discretion.
The applicants must take all necessary steps to publicise the fact that the European Union has financed or co-financed the action. As far as possible, actions that are wholly or partially funded by the European Union must incorporate information and communication activities designed to raise the awareness of specific or general audiences of the reasons for the action and the EU support for the action in the country or region concerned, as well as the results and the impact of this support.
In addition, the awareness and visibility activities will focus on the EU work in promoting responsible value chains in the cotton/garment sector.
Applicants must comply with the objectives and priorities and guarantee the visibility of the EU financing (see the Communication and Visibility Manual for EU external actions , and updated versions, specified and published by the European Commission at https://ec.europa.eu/europeaid/communication-and- visibility-manual-eu-external-actions_en).
Number of applications and grants per applicants / affiliated entities
The lead applicant may not submit more than one application per lot under this call for proposals(*).
The lead applicant may be awarded more than one grant under this call for proposals: one grant for each lot.
The lead applicant may not be a co-applicant or an affiliated entity in another application of the same lot at the same time(*).
A co-applicant/affiliated entity may not submit more than one application per lot under this call for proposals(*).
A co-applicant/affiliated entity may be awarded more than one grant under this call for proposals: one grant for each lot..
(*) Should this be the case, the EC will only consider the first proposal arrived (based on the date and hour of submission) and any other additional proposal will be rejected. It is the responsibility of each lead applicant to verify that its co-applicants are not involved as lead applicant or co-applicant in other proposals.
2.1.5 Eligibility of costs: costs that can be included
Only ‘eligible costs’ can be covered by a grant. The categories of costs that are eligible and non-eligible are indicated below. The budget is both a cost estimate and an overall ceiling for ‘eligible costs’.
The reimbursement of eligible costs may be based on any or a combination of the following forms:
actual costs incurred by the beneficiary(ies) and affiliated entity(ies)
one or more simplified cost options.
Simplified cost options may take the form of:
unit costs: covering all or certain specific categories of eligible costs which are clearly identified in advance by reference to an amount per unit.
lump sums: covering in global terms all or certain specific categories of eligible costs which are clearly identified in advance.
The amounts or rates have to be based on estimates using objective data such as statistical data or any other objective means or with reference to certified or auditable historical data of the applicants or the affiliated entity(ies). The methods used to determine the amounts or rates of unit costs, lump sums or flat- rates must comply with the criteria established in Annex K, and especially ensure that the costs correspond fairly to the actual costs incurred by the beneficiary(ies) and affiliated entity(ies), are in line with their accounting practices, no profit is made and the costs are not already covered by other sources of funding (no double funding). Refer to Annex K for directions and a checklist of controls to assess the minimum necessary conditions that provide reasonable assurance for the acceptance of the proposed amounts.
Applicants proposing this form of reimbursement, must clearly indicate in worksheet no.1 of Annex B, each heading/item of eligible costs concerned by this type of financing, i.e. add the reference in capital letters to "UNIT COST" (per month/flight etc), "LUMPSUM" or "FLAT RATE" in the Unit column. (see example in Annex K)
Additionally in Annex B, in the second column of worksheet no.2, "Justification of the estimated costs" per each of the corresponding budget item or heading applicants must:
describe the information and methods used to establish the amounts of unit costs, lump sums and/or flat-rates, to which costs they refer, etc.
clearly explain the formulas for calculation of the final eligible amount22
At contracting phase, the Contracting Authority decides whether to accept the proposed amounts or rates on the basis of the provisional budget submitted by the applicants, by analysing factual data of grants carried out by the applicants or of similar actions and by performing checks established by Annex K.
The total amount of financing on the basis of simplified cost options that can be authorised by the Contracting Authority for any of the applicants individually (including simplified cost options proposed by their own affiliated entities) cannot exceed EUR 60 000 (the indirect costs are not taken into account).
Recommendations to award a grant are always subject to the condition that the checks preceding the signing of the grant contract do not reveal problems requiring changes to the budget (such as arithmetical errors, inaccuracies, unrealistic costs and ineligible costs). The checks may give rise to requests for clarification and may lead the Contracting Authority to impose modifications or reductions to address such mistakes or inaccuracies. It is not possible to increase the grant or the percentage of EU co-financing as a result of these corrections.
It is therefore in the applicants' interest to provide a realistic and cost-effective budget
The simplified cost option may also take the form of an apportionment of Field Office's costs.
Field Office means a local infrastructure set up in one of the countries where the action is implemented or a nearby country. (Where the action is implemented in several third countries there can be more than one Field Office). That may consist of costs for local office as well as human resources.
A Field Office may be exclusively dedicated to the action financed (or co-financed) by the EU or may be used for other projects implemented in the partner country. When the Field Office is used for other projects, only the portion of capitalised and operating costs which corresponds to the duration of the action and the rate of actual use of the field office for the purpose of the action may be declared as eligible direct costs.
The portion of costs attributable to the action can be declared as actual costs or determined by the beneficiary(ies) on the basis of a simplified allocation method (apportionment).
The method of allocation has to be:
1. Compliant with the beneficiary's usual accounting and management practices and applied in a consistent manner regardless of the source of funding and
2. Based on an objective, fair and reliable allocation keys. (Please refer to Annex K to have examples of acceptable allocation keys).
A description prepared by the entity of the allocation method used to determine Field Office's costs in accordance with the entity's usual cost accounting and management practices and explaining how the method satisfy condition 1 and 2 indicated above, has to be presented in a separate sheet and annexed to the Budget.
The method will be assessed and accepted by the evaluation committee and the Contracting Authority at contracting phase. The applicant is invited to submit (where relevant) the list of contracts to which the methodology proposed had been already applied and for which proper application was confirmed by an expenditure verification.
At the time of carrying out the expenditure verifications, the auditors will check if the costs reported are compliant with the method described by the beneficiary(ies) and accepted by the Contracting Authority.
Adequate record and documentation must be kept by the beneficiary(ies) to prove the compliance of the simplified allocation method used with the conditions set out above. Upon request of the beneficiary(ies), this compliance can be assessed and approved ex-ante by an independent external auditor. In such a case, the simplified allocation method will be automatically accepted by the evaluation committee and it will not be challenged ex post.
When costs are declared on the basis of such allocation method the amount charged to the action is to be indicated in the column "TOTAL COSTS" and the mention "APPORTIONMENT" is to be indicated in the column "units" (under budget heading 1 (Human resources) and 4 (Local Office) of the Budget).
It has to be noted that the EUR 60.000 limit, otherwise applicable to costs declared on the basis of simplified cost options, is not relevant for costs declared following apportionment of Field Offices.
Eligible direct costs
To be eligible under this call for proposals, costs must comply with the provisions of Article 14 of the General Conditions to the standard grant contract (see Annex G of the guidelines).
The budget may include a contingency reserve not exceeding 5 % of the estimated direct eligible costs. It can only be used with the prior written authorisation of the Contracting Authority.
Eligible indirect costs
The indirect costs incurred in carrying out the action may be eligible for flat-rate funding, but the total must not exceed 7% of the estimated total eligible direct costs. Indirect costs are eligible provided that they do not include costs assigned to another budget heading in the standard grant contract. The lead applicant may be asked to justify the percentage requested before the grant contract is signed. However, once the flat rate has been fixed in the Special Conditions of the grant contract, no supporting documents need to be provided.
If any of the applicants or affiliated entity(ies) is in receipt of an operating grant financed by the EU, it may not claim indirect costs on its incurred costs within the proposed budget for the action.
Contributions in kind
Contributions in kind mean the provision of goods or services to a beneficiaries or affiliated entities free of charge by a third party. As contributions in kind do not involve any expenditure for beneficiaries or affiliated entities, they are not eligible costs.
Contributions in kind may not be treated as co-financing
However, if the description of the action as proposed includes contributions in kind, the contributions have to be made.
The following costs are not eligible:
HOW TO APPLY AND THE PROCEDURES TO FOLLOW
To apply for this call for proposals the lead applicants need to:
this data in PADOR is obligatory23 for this call for proposals:
Concept note step: Registration is obligatory for lead applicants applying for EU contributions of more than EUR 60 000.
Full application step: Registration is obligatory for co-applicant(s) and affiliated entity(ies). Lead applicants must make sure that their PADOR profile is up to date.
II. Provide information about the action in the documents listed under sections 2.2.2 (concept note) and 2.2.5 (full application). Please note that online submission via PROSPECT is obligatory for this call,
PADOR is an on-line database in which organisations register and update information concerning their entity. Organisations registered in PADOR get a unique ID (EuropeAid ID) which they must mention in their application. PADOR is accessible via the website: http://ec.europa.eu/europeaid/pador_en
It is strongly recommended to register in PADOR well in advance and not to wait until the last minute before the deadline to submit your application in PROSPECT.
If it is impossible to register online in PADOR for technical reasons, the applicants and/or affiliated entity(ies) must complete the ‘PADOR off-line form24 attached to these guidelines. This form must be sent together with the application, by the submission deadline (see sections 2.2.2 and 2.2.5).
Before starting using PADOR and PROSPECT, please read the user guides available on the website. All technical questions related the use of these systems should be addressed to the IT helpdesk at EuropeAid- ITemail@example.com via the online support form in PROSPECT.
2.2.1 Concept note content
Applications must be submitted in accordance with the concept note instructions in the grant application form25 annexed to these guidelines (Annex A.1). Applicants must apply in English.
Please note that:
1. In the concept note lead applicants must provide only an estimate of the requested EU contribution, as well as an indicative percentage of this contribution in relation to the total eligible costs of the action. A detailed budget is to be submitted only by lead applicants invited to submit a full application in the second phase
2. The elements outlined in the concept note may not be modified in the full application form. The EU contribution may not vary from the initial estimate by more than 20 %. Lead applicants are free to adapt the requested EU contribution as a percentage of the total eligible costs within the minimum and maximum amounts and percentages provided in section 1.3. The lead applicant may replace a co-applicant or an affiliated entity only in duly justified cases (e.g. bankruptcy of initial co-applicant or affiliated entity). In this case the new co-applicant/affiliated entity must be of a similar nature as the initial one. The lead applicant may adjust the duration of the action if unforeseen circumstances outside the scope of the applicants have taken place following the submission of the concept note and require such adaptation (risk of action not being carried out). In such cases the duration must remain within the limits imposed by the guidelines for applicants. An explanation/justification of the relevant replacement shall be included in section 2.1.1 of the grant application form. Should the explanation/justification not be accepted by the Evaluation Committee, the proposal shall be rejected.
Own contributions by the applicants can be replaced by other donors' contributions at any time.
3. Only the concept note form will be evaluated. It is therefore of utmost importance that this document contains all relevant information concerning the action. No additional annexes should be sent.
Any error or major discrepancy related to the concept note instructions may lead to the rejection of the concept note.
Clarifications will only be requested when information provided is not sufficient to conduct an objective assessment.
2.2.2 Where and how to send concept notes
The concept note together with the declaration by the lead applicant (Annex A.1 section 2) must be submitted online via PROSPECT https://webgate.ec.europa.eu/europeaid/prospect following the instructions given in the PROSPECT user manual.
Upon submission of a concept note online, the lead applicant will receive an automatic confirmation of receipt in its PROSPECT profile.
If it is impossible for lead applicants to submit their concept note online via PROSPECT for technical reasons, they must send their proposal in a sealed envelope and attach the concept note together with the declaration by the lead applicant (Annex A.1 section 2). In particular, the lead applicant must send, in a sealed envelope as described below the following items:
a. One original of the concept note. The signed declaration by the lead applicant (Annex A.1 section 2) must be printed and stapled separately and enclosed in the envelope
b. one additional copy in A4 size, bound.
c. An electronic version (CD-Rom or USB stick) of the items under point (a). The electronic file
must contain exactly the same application as the paper version enclosed.
The envelope must bear the reference number and the title of the call for proposals, together with the lot number and title the full name and address of the lead applicant, and the words ‘Not to be opened before the opening session’.
To reduce expense and waste, we strongly recommend that you do not use plastic folders or dividers. Please also use double-sided printing if possible.
Concept notes must be submitted in a sealed envelope by registered mail, private courier service or by hand-delivery (a signed and dated certificate of receipt will be given to the deliverer) to the address below. Where lead applicants send several concept notes (if allowed to do so by the guidelines of the call), each one must be sent separately:
Directorate General for International Cooperation and Development Unit B6 Finance, Contracts & Audit
Attn. Head of Unit L-41 03/110
Avenue du Bourget, 1
Tel : +32 2 2997916
Concept notes sent by any other means (e.g. by fax or by e-mail) or delivered to other addresses will be rejected. Hand-written concept notes will not be accepted.
Please note that incomplete concept notes may be rejected. Lead applicants are advised to verify that their concept note is complete by using the checklist for concept note (Annex A.1, Instructions).
2.2.3 Deadline for submission of concept notes
The deadline for the submission of concept notes is 8th February 2018 at 16:00 (Brussels date and time). In order to convert this deadline to local time you can use any online time converter tool that takes into account time zones and winter/summer time changes (example available here)26 The lead applicant is strongly advised not to wait until the last day to submit its concept note, since heavy Internet traffic or a fault with the Internet connection (including electricity failure, etc.) could lead to difficulties in submission. The Contacting Authority cannot be held responsible for any delay due to such afore- mentioned difficulties.
In the exceptional case of submission by post or by hand delivery (see section 2.2.2), the date of submission is evidenced by the date of dispatch, the postmark or the date of the deposit slip. In the case of hand-deliveries, the deadline for receipt is at 16:00 hours Brussels time 27as evidenced by the signed and dated receipt.
Any concept note submitted after the deadline will be rejected.
However, for reasons of administrative efficiency, the Contracting Authority may also reject any concept note sent in due time but received after the effective date of approval of the concept note evaluation (see indicative calendar under section 2.5.2).
2.2.4 Further information about concept notes
Questions may be sent by e-mail no later than 21 days before the deadline for the submission of concept notes to the address(es) below, indicating clearly the reference of the call for proposals:
E-mail address: Europeaidfirstname.lastname@example.org
The Contracting Authority has no obligation to provide clarifications to questions received after this date.
Replies will be given no later than 11 days before the deadline for submission of concept notes.
To ensure equal treatment of applicants, the contracting authority cannot give a prior opinion on the eligibility of lead applicants, co-applicants, affiliated entity(ies), an action or specific activities.
No individual replies will be given to questions. All questions and answers as well as other important notices to applicants during the course of the evaluation procedure will be published on the EuropeAid website https://webgate.ec.europa.eu/europeaid/online-services/index.cfm?do=publi.welcome, as appropriate. It is therefore advisable to consult the abovementioned website regularly in order to be informed of the questions and answers published.
All questions related to registration in PADOR or the online submission via PROSPECT should be addressed to the IT helpdesk at EuropeAid-ITemail@example.com via the online support form in PROSPECT: Please note that the working languages of the IT support are: English French and Spanish. Therefore users are invited to send their questions in English, French or Spanish should they wish to benefit from an optimum response time.
2.2.5 Full applications
Lead applicants invited to submit a full application following pre-selection of their concept note must do so using the full application form annexed to these guidelines (Annex A.2).
Applications must be submitted in accordance with the full application instructions at the end of Annex A.2. Lead applicants must submit their full applications in the same language as their concept notes.
Please note that:
1. The elements outlined in the concept note cannot be modified by the lead applicant in the full application form. The EU contribution may not vary from the initial estimate by more than 20%, although lead applicants are free to adapt the percentage of co-financing required within the minimum and maximum amount and percentages of co-financing, as laid down in these guidelines under section 1.3. The lead applicant may replace a co-applicant or an affiliated entity only in duly justified cases (e.g. bankruptcy of initial co-applicant or affiliated entity). In this case the new co- applicant/affiliated entity must be of a similar nature as the initial one. The lead applicant may adjust the duration of the action if unforeseen circumstances outside the scope of the applicants have taken place following the submission of the concept note and require such adaptation (risk of action not being carried out). An explanation/justification of the relevant replacement/adjustment shall be included in section 2.1.1 of the grant application form. Should the explanation/justification not be accepted by the Evaluation Committee, the proposal shall be rejected.
2. A copy of the lead applicant’s accounts of the latest financial year (the profit and loss account and the balance sheet for the last financial year for which the accounts have been closed) must be uploaded in PADOR by the full application deadline. A copy of the latest account is neither required from (if any) the co-applicant(s) nor from (if any) affiliated entity(ies)).
3. Only the full application form and the published annexes which have to be filled in (budget, logical framework) will be transmitted to the evaluators (and assessors, if used). It is therefore of utmost importance that these documents contain ALL the relevant information concerning the action. No additional annexes should be sent.
Any error or any major inconsistency related to the full application instructions (e.g. if the amounts in the budget worksheets are inconsistent) may lead to the rejection of the application.
Clarifications will only be requested when information provided is unclear and thus prevents the Contracting Authority from conducting an objective assesment.
2.2.6 Where and how to send full applications
Full application forms together with the budget, the logical framework and the declaration by the lead applicant must be submitted online via PROSPECT https://webgate.ec.europa.eu/ europeaid/prospect following the instructions given in the users’ manual.
Upon submission of the full application online, the lead applicants will receive an automatic confirmation of receipt in their PROSPECT profile.
(a) If the lead applicant submitted the concept note by post / hand delivery (see section 2.2.3) it must send the full application by the same means (by post or hand delivery).
(b) If the lead applicant submitted the concept note online via PROSPECT but it is technically impossible for the organisation to submit the full application online:
In the above two cases the lead applicant must send by post the application, i.e the full application form, the budget, the logical framework and the declaration by the lead applicant. The lead applicant must send, in a sealed envelope as described below, the following items:
a. One original signed copy of the full application form, the budget and the logical framework. The declaration by the lead applicant (Annex A.2, section 5) must be printed and stapled separately and enclosed in the envelope
b. One additional copy in A4 size, bound.
c. An electronic version (CD-Rom or USB stick) of the items under point (a). The electronic file must contain exactly the same application as the paper version enclosed.
To reduce expense and waste, we strongly recommend that you use only paper for your file (no plastic folders or dividers). Please also use double-sided printing if possible
Applications must be submitted in a sealed envelope by registered mail, private courier service or by hand-delivery (a signed and dated certificate of receipt will be given to the deliverer) to the address below. Where lead applicants send several applications (if allowed to do so by the guidelines of the call), each one must be sent separately:
Directorate General for International Cooperation and Development Unit B6 Finance, Contracts & Audit
Attn. Head of Unit L-41 03/110
Avenue du Bourget, 1
Tel : +32 2 2997916
The envelope must bear the reference number and the title of the call for proposals, together with the number and title of the lot, the full name and address of the lead applicant, and the words ‘Not to be opened before the opening session’.
Applications sent by any other means (e.g. by fax or by e-mail) or delivered to other addresses will be rejected. Hand-written applications will not be accepted.]
Please note that incomplete applications may be rejected. Lead applicants are advised to verify that their application is complete using the checklist (Annex A.2, Instructions).
2.2.7 Deadline for submission of full applications
The deadline for the submission of full applications will be indicated in the letter sent to the lead applicants whose application has been pre-selected. This letter will appear online automatically in the PROSPECT profile of the lead applicant. Lead applicants who, in exceptional cases (see section 2.2.6) had to submit their application by post or hand-delivery, will receive the letter by email or by post if no e- mail address was provided.
Lead applicants are strongly advised not to wait until the last day to submit their full applications, since heavy Internet traffic or a fault with the Internet connection (including electricity failure, etc.) could lead to difficulties in submission. The Contacting Authority cannot be held responsible for any delay due to such afore-mentioned difficulties.
In the case of submission by post, (see section 2.2.6), the date of submission is evidenced by the date of dispatch, the postmark or the date of the deposit slip. In the case of hand-deliveries, the deadline for receipt is at 16:00 hours Brussels time28 as evidenced by the signed and dated receipt.]
Any application submitted after the deadline will be rejected.
However, for reasons of administrative efficiency, the Contracting Authority may also reject any full application sent in due time but received after the effective date of approval of the full application evaluation (see indicative calendar under section 2.5.2).
2.2.8 Further information about full applications
Questions may be sent by e-mail no later than 21 days before the deadline for the submission of full applications to the addresses listed below, indicating clearly the reference of the call for proposals:
E-mail address: Europeaidfirstname.lastname@example.org
The Contracting Authority has no obligation to provide clarifications to questions received after this date. Replies will be given no later than 11 days before the deadline for the submission of applications.
To ensure equal treatment of applicants, the Contracting Authority cannot give a prior opinion on the eligibility of lead applicants, co-applicants, affiliated entity(ies), or an action.
No individual replies will be given to questions. All questions and answers as well as other important notices to applicants during the course of the evaluation procedure, will be published on the EuropeAid website https://webgate.ec.europa.eu/europeaid/online-services/index.cfm?do=publi.welcome, as appropriate. It is therefore advisable to consult the abovementioned website regularly in order to be informed of the questions and answers published.
All questions related to registration in PADOR or the online submission via PROSPECT should be addressed to the IT helpdesk at EuropeAid-ITemail@example.com via the online support form in PROSPECT. Please note that the working languages of the IT support are: English French and Spanish. Therefore users are invited to send their questions in English, French or Spanish should they wish to benefit from an optimum response time.
2.3 EVALUATION AND SELECTION OF APPLICATIONS
Applications will be examined and evaluated by the Contracting Authority with the possible assistance of external assessors. All applications will be assessed according to the following steps and criteria.
If the examination of the application reveals that the proposed action does not meet the eligibility criteria stated in section 2.1, the application will be rejected on this sole basis.
STEP1: OPENING & ADMINISTRATIVE CHECKS AND CONCEPT NOTE EVALUATION
During the opening29 and administrative check (including the eligibility check of the action) the following will be assessed:
If the deadline has been met. Otherwise, the application will be automatically rejected.
If the concept note satisfies all the criteria specified in the checklist in the instructions included in Annex A.1. This includes also an assessment of the eligibility of the action. If any of the requested information is missing or is incorrect, the application may be rejected on that sole basis and the application will not be evaluated further.
The concept notes that pass this check will be evaluated on the relevance and design of the proposed action.
The concept notes will receive an overall score out of 50 in line with the evaluation grid below. The evaluation will also check the compliance with the instructions on how to complete the concept note (Annex A.1).
The evaluation criteria are divided into headings and subheadings. Each subheading will be given a score between 1 and 5 as follows: 1 = very poor; 2 = poor; 3 = adequate; 4 = good; 5 = very good.
(TRUNCATED -- please visit the public link for the full proposal)