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Protecting EU interests

The Early Detection and Exclusion System: EDES

The EDES in detail

  1. The purpose
  2. The Panel
  3. The database
  4. Data Protection

The EDES is the system established by the Commission to reinforce the protection of the Union's financial interests and to ensure sound financial management.

It replaced the Early Warning System and the Central Exclusion Database as of 1 January 2016.

The EDES rules are found in the revised Financial Regulation1.

The EDES includes a number of improvements to the current tools by the setting-up of Panel and the creation of a database.

Time frame

The rules are applicable from 2016 to all contracts, grant agreements, prizes, financial instruments and remunerated experts, as well as for the implementation of the budget under indirect management.

The EDES in detail

1. The purpose

The purpose of the EDES is the protection of the Union's financial interests against unreliable economic operators. In particular, the EDES ensures:

  • the early detection of an economic operator representing risks threatening the Union's financial interests;
  • the exclusion of an economic operator from receiving Union's funds (Article 136 of the Financial Regulation);
  • the imposition of a financial penalty on an economic operator (Article 138) of the Financial Regulation);
  • the publication, in the most severe cases, on the Commission's internet site of information related to the exclusion and where applicable the financial penalty, in order to reinforce their deterrent effect (Article 140 of the Financial Regulation).

The information on early detection/exclusion/financial penalty may stem from:

  • final judgment or final administrative decisions;
  • facts and findings from the Anti-fraud office of the Commission (OLAF), Court of Auditors, audits or any other check, audit or control performed under the responsibility of the competent authorising officer2
  • non-final judgments or administrative decisions;
  • decisions of the European Central Bank (ECB), the European Investment Bank (EIB), the European Investment Fund or international organisations;
  • cases of fraud and/or irregularity by national managing authorities under shared management;
  • cases of fraud and/or irregularity by delegated entities under indirect management.

The grounds for exclusion are listed under article 136 of the Financial Regulation. They concern:

  • bankruptcy and insolvency situations;
  • non-payment of taxes or social security contributions;
  • grave professional misconduct;
  • fraud, corruption, participation in a criminal organisation etc.;
  • serious breach of contract;
  • irregularity.
  • entities created with the intent to circumvent fiscal, social or other legal obligations.

2. The Panel

A Panel is set-up to assess requests and issue recommendations for exclusion and financial penalty on cases referred to it by an authorising officer of a Union institutions, Union body, European office or body entrusted with implementing the CFSP (Article 143 of the Financial Regulation). The competent authorising officer will refer a case to the Panel for a central assessment when there are no final judgments or final administrative decisions related to the exclusion and its duration or to the financial penalty, and their publication.

When the contracting authority decides to deviate from the recommendation of the panel, it shall justify such decision to the panel.

The Panel will also be competent to ensure the rights of defence of the economic operator.

It is then the competent authorising officer that takes the decision on the basis of the panel recommendation to exclude and/or impose a financial penalty and possibly publish the related information on the Commission's website.

The system retains the possibility to assess the remedial measures taken by the economic operator to demonstrate its reliability. In this case, the economic operator should not be excluded (except for the most severe criminal activities).

The Panel will be independent and composed of:

  • a high-level independent chair;
  • 2 representatives of the Commission as owner of the system;
  • one representative of the requester within the Commission or other Institutions and bodies.

3. The database

The above information on early detection or exclusion and/or financial penalty will be entered in a database (the EDES database) by the Commission, its executive agencies, other institutions, bodies or European offices.

The database is set up and operated by the Commission (Article 142 of the Financial Regulation).

4. Data Protection

The EDES shall comply with Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 on the protection of individuals with regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data.

You may find below the privacy statement for the EDES Database:
Privacy statement for the EDES Database.

1. Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union

2. Referred to as 'the contracting authority' in the Financial Regulation

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