The glass houses of the Ministry of Development

The amendment to the so-called 'implementation act’, which is part of the 'constitution for business’ package, contains a number of improvements that should really improve the process of applying for EU subsidies by entrepreneurs. These changes consist, among others, of shortening the time limits for examining appeals (e.g. the total time limit for examining protests has been reduced from 60 to 45 days), removing the obligation for beneficiaries to submit some attachments in paper form (at present, institutions will obtain the relevant documents and certificates from public registers), division of competitions into rounds – these are the basic improvements, which, according to the Ministry, are to significantly contribute to the removal of administrative barriers for beneficiaries.

The draft law also contains proposals which cannot be regarded as anything other than a façade, designed to create the appearance of significant change. Among such proposals is the appointment of an European Funds Ombudsman – in practice an employee of the managing institution, who has unspecified soft competencies – and, moreover, it is unclear to what exact need he is responding. If it is a need to support entrepreneurs, then undoubtedly his powers do not add anything to the processes of applying for subsidies, especially since entrepreneurs applying for EU funds have already received significant support from the Ombudsman in the past. At the same time, it is impossible to imagine how one colleague in the room (the Ombudsman) is supposed to control and monitor or possibly admonish another colleague who handles the project selection process.

The possibility for entrepreneurs to make changes to projects after the applications have been submitted is also such a facade change. Although the project allows for a theoretical possibility of such changes – but the whole regulation in this area, including whether in a given contest such a possibility will occur, and to what extent and in what mode such a supplementation is possible, is granted to the institution granting funding.

Some changes can hardly be described as anything other than a cabaret, e.g. granting applicants the right to withdraw a protest:)

In my opinion, the bill basically only pretends to solve the real problems faced by entrepreneurs applying for EU funds. First and foremost, the problem of regulations under which competitions for EU grants are conducted is still unresolved. Despite the fact that already in 2012. Despite the fact that already in 2012, the Constitutional Tribunal questioned the possibility of conducting competitions on the basis of documents which do not have the form of universally binding regulations, the indications of this judgment are still ignored by the legislator. At the same time, this issue has a significant practical dimension – still an entrepreneur who applies for a grant in the Łódzkie Voivodeship and at the same time in the Śląskie Voivodeship must take into account the fact that his basic rights and obligations in these competitions, specified in regulations, instructions and guides adopted by the institutions, may look different. For example, the scope of possible supplements and amendments to the application may be different, the mode of submitting the application itself may be different, or there may be other requirements for the applicant as to how the application should be filled in.

Additionally, an important problem signalled for many years now is the issue of practically complete exclusion from the application assessment procedure of the provisions of the Administrative Procedure Code (except for deadlines, delivery, etc.). This results, inter alia, in the fact that in proceedings concerning the evaluation of projects it is difficult to refer to such basic principles as the principle of proportionality, objectivity, information or, for example, the recently introduced principle of resolving doubts in favour of the entrepreneur. In practice, there has never been a deeper reflection on the part of the public administration as to whether and, if so, to what extent it would be worthwhile to apply the administrative procedure to the grant project evaluation procedures. Instead, one can perceive very general opinions that project appraisal procedures are so-called third generation procedures, which should provide the administration with higher flexibility. Arguably, if the administrative culture of the awarding institutions was higher then one could seriously consider such an approach….

The Ministry also did not touch such important problems as e.g. the exhaustion of allocations during application assessment procedures, which may put at a disadvantage those entrepreneurs who, as a result of the assessors’ mistakes, will have to wait for their protests to be resolved in the appeal procedure. The Ministry justifies such an approach with what it considers the cardinal principle of the speed of spending EU funds. Meanwhile, this principle cannot be found in the EU regulations, which state that for the disbursement of EU funds one should first use the already existing national procedures. Unfortunately, as the history of spending shows (e.g. the already famous Measure 8.1 of the Innovative Economy Operational Programme), fast does not mean good in this case, but rather bad. I would like to take this opportunity to point out that there is already a case pending in the Constitutional Court (in which I had the pleasure of preparing a constitutional complaint) that may finally resolve this problem (reference SK 17/17).

I also fail to mention the very significant lack of harmonisation and review of the procedures used by the various institutions when disbursing funds. Currently, almost every central institution involved in the implementation of EU programmes, e.g. PARP, NCBR, has its own act, which is worth getting to know before an entrepreneur decides to apply for EU funds.

It is worth noting that in some areas the position of entrepreneurs is deteriorating. For example, the separation of the so-called formal requirements during the evaluation (which used to be part of the selection criteria), introduced under the guise of improvement, in reality leads to depriving entrepreneurs of the possibility to lodge a complaint to the court – failures in this respect are not subject to a complaint to the court.

Changes to the Public Finance Act regarding the limitation period for claims resulting from agreements on co-financing should be perceived in a similar way. Namely, the limitation period for these claims is to run only from the moment the decision on reimbursement of funds becomes final, or from the date of payment of the so-called final balance by the EC, which takes place at the closure of a given programme. Meanwhile, currently, the limitation period is calculated from the moment of transfer of funds to the beneficiary – as is the amount of interest. This change, the genesis of which, as one can guess, is the ineffectiveness of institutions in collecting contractual debts, significantly worsens the position of entrepreneurs.

Amendments to the Implementation Act are part of the steady stream of recent years in the legislative area of EU funds, only appearing to solve real problems and creating new ones, primarily for entrepreneurs. When observing the changes to the regulations on European funds over a longer time horizon, I have to conclude that the successive amendments serve in principle to patch up the immediate problems of individual institutions, rather than systemic changes. One such change is, for example, the issue of exhaustion of allocations, which was introduced several years ago as a pretext for allowing institutions to leave protests unprocessed. Another change is the one, only slightly eased by the current amendment, concerning exclusion from enforcement of assets created within the framework of a project. The latest amendment is, unfortunately, another missed opportunity to significantly improve the legal environment for entrepreneurs in the area of European funds. This is a pity, all the more so because the amendment, which had been heralded as part of the package of the Constitution for Business, was a banner carrying changes beneficial to entrepreneurs. As usual, however, it ended up as an announcement.