Stocks

Stocks may cover both durable equipment and consumable goods.

Goods purchased before the submission of an Action proposal, and purchased in compliance with the general principles of good procurement may be qualified as stocks.

The detailed procurement procedures have to respect only mandatory principles for procurement (to be found in chapter 2 of Annex IV in case of signatories of the FPA), regardless of the type of financing Decision on which the Action is based.

Expenditure committed before the date of submission of the Action proposal is eligible for European Union financing when this expenditure is related to the constitution of stocks used within the action for which the funds are awarded (cf. also Article 18.1 c) of the General conditions).

Therefore, in order to be eligible, stocks of goods must:

• be used in the action being financed;
• be constituted in compliance with the general principles of Title I of the FPA, Chapter 2 of Annex IV to the FPA/NGO, and Article 6 of the FAFA, i.e. best value for money, transparency, equal treatment, avoidance of conflicts of interest, observance of the highest ethical standards, non-exploitation of child labour, respect of basic working conditions and social rights, access and controls by the European Commission; and
• be of satisfactory quality, timely delivery or completion, price corresponding to market prices and having no adverse effect on the economy or efficiency of the action.

Goods purchased after the submission of the Action proposal but prior to the signature of the Agreement are not qualified as stocks (see also Fact sheet A.2 Dates and durations in financing Decisions and Agreements). Related costs are only eligible if the purchases have been made during the eligibility period of expenditure as specified in Article 2.3 of the Agreement.

Agreements subject to the A control mechanism shall follow for these purchases the Humanitarian Aid Guidelines for Procurement and, when the total amount of the tender exceeds EUR 60,000, all detailed procurement procedures described in the procurement rules (“Annex IV” in case of signatories of the FPA).

When the implementation of the Action requires the mobilisation by the Partner of stocks belonging to Partner's or another organisation and when there is no obligation for the Partner to replenish the stocks, DG ECHO will reimburse the costs on the basis of the historical costs of purchase (as any other relevant costs when applicable, e.g. storage, insurance and packaging costs) in the same terms as it would have reimbursed them had the Partner used its own stocks.
The stocks must not have been paid for already by the EU or other donor's funding.

When the implementation of the Action requires the mobilisation by the Partner of stocks constituted within the framework of a preparedness action funded by DG ECHO or by another donor or constituted by the Partner to maintain its emergency response capacity, DG ECHO will reimburse the costs on the basis of the reconstitution costs.
The replenishment should be clearly indicated in the final report.


Click here for more information on Stockpiling.

References and Useful Links

• Annex IV, Article 4.5
• Fact sheet B.1, section 3.4
• Fact sheet B.2