12003T035

Article 35

1. A Schengen Facility is hereby created as a temporary instrument to help beneficiary Member States between the date of accession and the end of 2006 to finance actions at the new external borders of the Union for the implementation of the Schengen acquis and external border control.

In order to address the shortcomings identified in the preparation for participation in Schengen, the following types of action shall be eligible for financing under the Schengen Facility:

- investment in construction, renovation or upgrading of border crossing infrastructure and related buildings,

- investments in any kind of operating equipment (e.g. laboratory equipment, detection tools, Schengen Information System-SIS 2 hardware and software, means of transport),

- training of border guards,

- support to costs for logistics and operations.

2. The following amounts shall be made available under the Schengen Facility in the form of lump-sum grant payments as of the date of accession to the beneficiary Member States listed below:

(EUR million, 1999 prices) |

| 2004 | 2005 | 2006 |

Estonia | 22,9 | 22,9 | 22,9 |

Latvia | 23,7 | 23,7 | 23,7 |

Lithuania | 44,78 | 61,07 | 29,85 |

Hungary | 49,3 | 49,3 | 49,3 |

Poland | 93,34 | 93,33 | 93,33 |

Slovenia | 35,64 | 35,63 | 35,63 |

Slovakia | 15,94 | 15,93 | 15,93 |

3. The beneficiary Member States shall be responsible for selecting and implementing individual operations in compliance with this Article. They shall also be responsible for coordinating use of the facility with assistance from other Community instruments, ensuring compatibility with Community policies and measures and compliance with the Financial Regulation applicable to the general budget of the European Communities.

The lump-sum grant payments shall be used within three years from the first payment and any unused or unjustifiably spent funds shall be recovered by the Commission. The beneficiary Member States shall submit, no later than six months after expiry of the three-year deadline, a comprehensive report on the financial execution of the lump-sum grant payments with a statement justifying the expenditure.

The beneficiary State shall exercise this responsibility without prejudice to the Commission's responsibility for the implementation of the general budget of the European Communities and in accordance with the provisions of the Financial Regulation applicable to decentralised management.

4. The Commission retains the right of verification, through the Anti-Fraud Office (OLAF). The Commission and the Court of Auditors may also carry out on-the-spot checks in accordance with the appropriate procedures.

5. The Commission may adopt any technical provisions necessary for the operation of this Facility.

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