# Decision of the European Ombudsman on complaint 1232/2004/GG against the European Commission
- Forfatter: Den Europæiske Ombudsmand
- Dato: 2004-10-14T00:00+02:00[Europe/Paris]
- [URL](https://www.ombudsman.europa.eu/da/decision/da/2179)
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Strasbourg, 14 October 2004

Dear Professor K.,

In a letter dated 19 April 2004 (which I received on 29 April 2004),
you submitted, acting on behalf of Technische Universität Berlin, a complaint
against the European Commission concerning the duty to pay interest on
amounts not used for Leonardo da Vinci projects.

On 4 May 2004, I forwarded the complaint to the President of the European
Commission.

On 10 June 2004, Ms von Matuschka forwarded to me a copy of your most
recent correspondence with the Commission. I forwarded a copy of this
correspondence to the Commission on 14 June 2004.

The Commission sent its opinion on 4 August 2004 and I forwarded it
to you on 16 August 2004 with an invitation to make observations.

On the occasion of a telephone conversation on 21 September 2004, Ms
von Matuschka informed my services that the complaint could be considered
as having been settled and thanked me for my intervention.

I am writing now to let you know the results of the inquiries that have
been made.

THE COMPLAINT
-------------

The present complaint concerned three Leonardo da Vinci projects carried
out by the "Career Service" of the complainant, the Technische Universität
Berlin:
*Project D/99/2/07354/PL/II.1.2a/FPI*

By letter of 9 December 2002, the Commission informed the complainant
that part of the sums that had already been paid to the latter under the
contract needed to be repaid. The relevant sum amounted to EUR 88 483,
80. The Commission asked the complainant to repay this sum plus interest
amounting to EUR 7 654, 45 (making a total of EUR 96 138, 25) by 31 March
2003.

On 20 December 2002, the complainant objected to the Commission's demand
that interest should be paid. The complainant submitted that it was in
principle impossible for it to place sums of money with a view to earning
interest.

In January 2003, the complainant repaid the amount of EUR 88 483, 80
to the Commission.

By letter of 20 January 2003, the Commission informed the complainant
that it would deal with its complaint shortly.

On 19 February 2003, the Commission's Accounting Officer wrote to the
complainant to point out that an amount of EUR 7 654, 45 was still outstanding.
In its reply of 6 March 2003, the complainant pointed out that it had
objected to the Commission's demand to pay this sum on account of interest
and that in the absence of a reply to this complaint, it was not in a
position to pay the relevant sum.

In a further letter of 27 March 2003, the Commission's Accounting Officer
again referred to the amount of EUR 7 654, 45 that was still due and informed
the complainant that part of that amount (EUR 4 950, 54) would be recovered,
pursuant to Article 73 (1), second sub-paragraph of Council Regulation
(EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation
applicable to the general budget of the European Communities (OJ 2002
no. L 248, p. 1), by offsetting it against a request for payment made
by the complainant under another project. In its reply of 17 April 2003,
the complainant referred to its complaint against the Commission's demand
for payment of interest and asked the relevant service of the Commission
to check the issue with the Commission's financial department.

In an e-mail sent on 8 December 2003, the Commission referred to the
complaint against the demand for payment of interest and pointed out that
it intended to finalise its position regarding this point in the near
future. The Commission therefore asked the complainant to submit, by 18
December 2003, documentary evidence in order to prove that it was unable
to place money on an account with a view to earning interest. On 15 January
2004, the complainant sent further information regarding this point to
the Commission.
*Project D/99/2/07355/ PL/II.1.2a/FPC*

Also by letter of 9 December 2002, the Commission informed the complainant
that part of the sums that had already been paid to the latter under this
contract needed to be repaid. The relevant sum amounted to EUR 31 743,
70. The Commission asked the complainant to repay this sum plus interest
amounting to EUR 2 829, 90 (making a total of EUR 34 573, 60) by 31 March
2003.

On 20 December 2002, the complainant submitted that the recovery should
be reduced by EUR 229. The complainant also objected to the Commission's
demand that interest should be paid.

In January 2003, the complainant repaid the undisputed amount of EUR
31 514, 70 to the Commission.

By letter of 20 January 2003, the Commission informed the complainant
that it would deal with its complaint shortly. The Commission added that
the deadline for repaying the relevant sums under the present contract
had been suspended.

On 21 May 2003, the Commission informed the complainant that its objection
regarding the disputed item (i.e., the sum of EUR 229) had been accepted.
The Commission further informed the complainant that the issue of interest
would be dealt with separately by the "competent service".

By letter dated 28 May 2003, the Commission's Accounting Officer referred
to three different amounts (including a sum of EUR 3 058, 90) that in
his view were still due and informed the complainant that these amounts
would be recovered, pursuant to Article 73 (1), second sub-paragraph of
the Financial Regulation, by offsetting them against a request for payment
made by the complainant under another project.

In a further letter sent the same day, the complainant informed the Commission
that it also objected to the offsetting of the amount of EUR 3 058, 90
against other claims. The complainant noted that it had only been able
to discover that this amount included the interest claimed by the Commission
(EUR 2 829, 90) and the amount that the Commission had in the meantime
acknowledged as not being due (EUR 229) when it had received a letter
dated 14 January 2004 in which the Commission had provided information
regarding another project. Given that the sum of EUR 229 had in any event
been deducted without reason and that the issue of the duty to pay interest
was not yet resolved, the complainant asked the Commission to reimburse
the amount of EUR 3 058, 90.
*Project D/98/2/05733/PL/II.1.2a/FPI*

By letter of 8 November 2002, the Commission informed the complainant
that part of the sums that had already been paid to the latter under this
contract needed to be repaid. According to the Commission, the relevant
sum amounted to EUR 34 247, 35.

On 27 November 2002, the complainant objected to this recovery and requested
a detailed evaluation. The complainant noted that the Commission's letter
did not enable it to identify which amounts had been accepted and which
had not.

In a fax sent on 6 December 2002, the Commission sent the complainant
a table setting out the relevant amounts. According to this table, the
sum to be repaid amounted to EUR 31 849, 90. In its reply of 10 December
2002, the complainant objected to certain aspects of the calculation.

On 17 January 2003, the Commission informed the complainant that it would
deal with its complaint shortly. The Commission added that the deadline
for repaying the relevant sums under the present contract had been suspended.

In a letter of 8 April 2003, the Commission informed the complainant
that it had accepted all its demands (i.e., a sum of EUR 378) and that
the sum to be repaid amounted to EUR 31 471, 90.

On 14 January 2004, the Commission informed the complainant that a further
amount of EUR 2 397, 15 had to be paid on account of interest due to the
fact that in its letter of 17 (in reality, 10) December 2002, the complainant
had not objected to the demand for the payment of interest.

On 21 January 2004, the complainant replied that it had only learnt about
the demand for the payment of interest through the Commission's letter
of 14 January 2004. The complainant explained that it did not agree with
this demand and requested that the issue should be clarified as quickly
as possible.
*The present complaint*

In its complaint to the Ombudsman, the complainant in substance alleged
that the Commission had acted wrongly (1) by demanding the payment of
interest on amounts that had to be repaid to the Commission under Leonardo
da Vinci projects D/99/2/07354, D/99/2/07355 and D/98/2/5733) and (2)
by offsetting these and other amounts against other claims. The complainant
claimed that the Commission should repay the sums that had been claimed
by its services and offset against other claims of the complainant, that
is to say, 1) EUR 7 654, 45 interest from project D/99/2/7354, (2) EUR
2 829, 00 interest plus the amount of EUR 229 from project D/99/2/7355
and (3) EUR 2 397, 45 interest plus the amount of EUR 378 from project
D/98/2/5733.

THE INQUIRY
-----------

**The Commission's opinion**

In its opinion, the Commission made the following comments:

Article 4 (7) of the grant agreements concluded between the Commission
and recipient of the grant provided as follows: "Amounts paid to
the contracting party or to a partner that are not used within 45 days
have to be invested so as to yield interest. The interest thus gained
has to be indicated in the financial account and transferred to the recipient
of the grant who has to pay it into an account in the name of the Commission."

On the basis of this article, the Commission had asked the complainant
to pay interest on the amounts that it had received but not used within
45 days.

The complainant had claimed that under German law it was unable to invest
amounts that it had received so as to earn interest. However, the information
provided by the complainant in its appeals and in its letter of 15 January
2004 had not been sufficient to prove this.

By letter of 9 June 2004, the complainant had provided additional information
to the Commission. It had also submitted a copy of a letter from the Senate
of Berlin according to which the complainant was not allowed to place
money on accounts producing interest.

On the basis of this information, the Commission was now able to accept
the complainant's arguments. The amount of interest that had already been
recovered or set off would be reimbursed to the complainant. The latter
had been informed accordingly by letters of 21 June 2004.

The set-off had been based on Article 4 (2), fifth sub-paragraph of the
grant agreements, in accordance with Article 73 (1), second sub-paragraph
of Council Regulation (EC, Euratom) No 1605/2002. However, given that
the Commission had accepted the complainant's arguments as regards the
duty to pay interest, the relevant amounts would (as mentioned above)
be reimbursed to the complainant.
**The complainant's position**

On the occasion of a telephone conversation on 21 September 2004, the
complainant informed the Ombudsman's services that the complaint could
be considered as having been settled and thanked the Ombudsman for his
intervention.

THE DECISION
------------

**1 Allegedly incorrect claim for interest and set-off**

1.1 The present complaint concerned Leonardo da Vinci projects carried
out by the complainant, the Technische Universität Berlin. Certain amounts
that had been provided by the Commission were not used and duly repaid
by the complainant. The Commission asked the complainant to pay interest
on these sums amounting to around EUR 13 000 and set off part of this
claim against other claims that the complainant had against the Commission.
The complainant alleged that the Commission had acted wrongly by claiming
interest and by setting off part of its claim against other claims. It
took the view that the Commission should repay the relevant amounts.

1.2 In its opinion, the Commission explained that the grant agreement
provided for the payment of interest on amounts that were not used. The
Commission pointed out that the complainant had claimed that under German
law it was unable to invest amounts that it had received so as to earn
interest. According to the Commission, however, the information provided
by the complainant in its appeals against the Commission's decisions and
in a letter of 15 January 2004 had not been sufficient to prove this.
The Commission noted that by letter of 9 June 2004, the complainant had
provided additional information, including a copy of a letter from the
Senate of Berlin according to which the complainant was not allowed to
place money on accounts producing interest. On the basis of this information,
the Commission was now able to accept the complainant's arguments. The
amount of interest that had already been recovered or set off would be
reimbursed to the complainant. According to the Commission, the latter
had been informed accordingly by letters of 21 June 2004.

1.3 On the occasion of a telephone conversation on 21 September 2004,
the complainant informed the Ombudsman's services that the complaint could
be considered as having been settled and thanked the Ombudsman for his
intervention.
**2 Conclusion**

It appears from the Commission's comments and the complainant's observations
that the Commission has taken steps to settle the matter and has thereby
satisfied the complainant. The Ombudsman therefore closes the case.

The President of the Commission will also be informed of this decision.

Yours sincerely,

P. Nikiforos DIAMANDOUROS