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What steps should FLAGs take to avoid conflicts of interests?

Introduction and definition

A conflict of interests arises where the impartiality or objectivity of someone involved in any way in making, influencing or preparatory actions leading to a decision is compromised by their own interests or any shared interest with an applicant (1). There is an inherent risk of conflict of interests within a FLAG where the method depends on partnerships comprised of interested local actors and local decision-making re applying resources to locally defined needs. The Financial Regulation specifies that steps be taken where a risk of conflict of interests arises, this involves excluding the individual concerned from the process. FLAGs must therefore be aware, plan, design and employ robust and transparent procedures to manage and record their decision-making processes and thereby avoid any actual conflicts of interest arising.

Relevance to Fisheries Local Action Groups

The risks of conflicts of interests arising in FLAG decision-making was highlighted by the European Court of Auditors special report (2) on Leader implementation. The Court found that ‘given the local nature of LAGs, one of the greatest risks for efficiency, the added value of the Leader programmes and for the reputation of the EU is that of a conflict of interests, whereby a project promoter may influence the project selection decision in their favour. The risk is heightened in LAGs that do not have transparent, objective and well-documented procedures.’
The Court highlighted the need for robust procedures evidencing and recording their project selection and decision-making processes to be in place, implemented and documented demonstrating that the LAGs ‘took decisions on an objective basis, free from conflicts of interest’.
It is therefore essential that FLAGs avoid such scenarios and set out not only the way in which decisions are to be made but also how this will be robustly and transparently evidenced and recorded. This is of the utmost importance where a FLAG partner is the project promoter.

Conflict of interest procedures

Project selection procedures should set out the decision-making process and the decision-making criteria to be employed. This should clearly identify the sequence of events and who is involved at each stage of the process. The use of a flow diagram is a useful way of representing this clearly.
Adequate separation of responsibilities must be maintained between the different elements of the process to ensure transparency in decision-making and to avoid any potential conflict of interests. FLAGs should therefore describe their procedure for avoiding conflicts of interests; this must be consistent with the provisions of Council Regulation No 996/2012 Article 57.
In general terms the following principles should be observed as a minimum:
- the submission of projects by FLAG members should only occur when this is in the interests of the territory and the delivery of the local development strategy and where the involvement of the partner is essential to the project’s viability or success;
- those involved in project development should not be involved in any way in project selection;
- staff should only undertake technical appraisals or offer technical advice on a project;
- anyone involved in project assessment or selection with an interest in a project (as defined under the Regulation) should declare that interest and withdraw from any involvement in the FLAG’s consideration of the project and the decision-making process in accordance with the FLAG’s procedure for avoiding conflicts of interest; and
- a register of FLAG members interests should be prepared, this should record the nature of any link between a member of the selection committee and a project or any applicant.

The ‘four eyes’ approach whereby every decision is seen by at least two people independently is recommended.

Involvement of the MA

Where FLAGs are unsure as to whether a project presents a risk of a conflict of interest it may be referred to the Managing Authority for an opinion. Responsibility for ensuring that any such conflict is avoided rests solely with the FLAG.


[2] ECA Special Report No 5/2010 — Implementation of the Leader approach for rural development