Understanding the Grant Agreement by mbf17044

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									      Objective
      • Provide an overview of the Grant Agreement and
        highlight key legal issues


      • Provide a clarification on the legal obligations of
        the PRs and SRs

      • *Identify opportunities for facilitating the grant
        negotiation process*



South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
The Grant Agreement
• Written encapsulation of the agreed-upon terms of
  the grant
• The product of the CCM proposal, PR
  assessment, negotiations regarding budget,
  performance indicators, procurement activities…
• The central document over the course of the
  Program Term
• Signing of the Agreement ends the negotiations
  and begins a new relationship
      The Grant Agreement in Further Detail
      • The Grant Agreement is a legally binding contract…

              – between the GF and PR;

              – based on and consistent with the CCM Proposal approved by the
                GF Board;

              – creating enforceable obligations on both Parties;

              – outlining the most important provisions to be respected by grant
                stakeholders (including the results that must be achieved if funds
                are to be disbursed);

              – Enumerating key roles and responsibilities of PRs and SRs; and

              – holding PRs accountable for achieving intended results.


South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
      Program Grant Agreement


                                                    Face Sheet




                                           Standard Terms and Conditions




                                                      Annex A
                                           (Program Abstract and CPs/SCs)




             Performance Framework Year 1-5                          Summary Budget Year 1-5


South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
      Face sheet (page 1)
    The Face sheet of the Grant Agreement consists
    of two pages.

    The first page contains:

             • Grant amount
             • Key dates (duration of Program, Condition
               Precedent terminal dates, fiscal year of the PR)
             • PR bank account information
             • LFA contact information
             • Basic contact information for both Parties


    All changes to the face sheet must be made through
    a formal amendment, usually called Implementation
    Letter


South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
Decision of the November Board Meeting:
Initial and Continuing Commitments




  Block 8A                        Block 8B
  Grant Funds for Initial First   Grant Funds for Supplementary
  Commitment: US$/€               First Commitment: US$/€
      Face sheet (page 2)
      The second page of the Grant Agreement
      contains signature blocks for:

              • PR Authorized Representative;

              • Global Fund Authorized Representative;

              • Chair of the CCM; and

              • A CCM Civil Society Representative.

      The CCM representatives sign for acknowledgement
      purposes only.




South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
      Face sheet - key points

              – Program starting dates are left blank at signature;
              – Art. 3.c of the Standard Terms & Conditions explains
                how the Program start date is calculated;
              – Terminal dates for Conditions Precedent are anticipated
                at the time of grant signature.




South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
      Performance Framework 1-5
      A. Periods covered and dates for disbursement requests and
      progress updates




                                                                            Period 1        Period 2     Period 3

      Period Covered: from                                                1-Sep-09       1-Dec-09      1-Mar-10


      Period Covered: to                                                  30-Nov-09      29-Feb-10     31-May-10

      Date Progress Update due (typically 45 days after end of period)    14-Jan-10      14-Apr-10     15-Jul-10

      Disbursement Request ? (Y,N)                                             N               Y            N




                                           28-Feb-11         28-Feb-12                Semi-annual disbursement
      Annual Report Due Date:
                                                                                      schedule, quarterly
                                           30-Jun-10         30-Jun-11                reporting
      Audit Report Due Date:




      18 months or less after                          6 months or less after end of fiscal year
      Phase 1 Starting Date
South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
      Annex A
  Annex A provides key Program information:

          –Background and Summary
                   •Should not include specific targets or
                   commitments.
                   •Should be objective and comprehensive, even
                   for people not familiar with the Program
          –Goal (same as in the Proposal)
          –Target Groups/Beneficiaries
          –Strategies
          –Planned Activities
          –Disbursement periods (quarterly or semi-annual)




South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
      Annex A
      • Annex A sets out Conditions Precedent (CPs) to
        disbursement and/or Special Conditions (SCs).
        CPs and SCs:
              – Are mostly based on LFA Recommendations from pre-grant
                assessment or Phase 2 review and other identified risks or capacity
                issues;
              – Are based on Secretariat’s assessment of risk associated with the
                Program implementation;
              – Introduce specific measures to ensure and enhance PR capacity and
                facilitate Program implementation
              – Serve to secure necessary relevant information (e.g. bank account,
                signatory authority)




South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
      Annex A
      • Difference between CPs and SCs:
              – CPs are tied to specific disbursements
                stages (e.g., CP to 1st disbursement, CP to
                procurement of Health Products, etc.).
              – SCs are meant to be applicable through
                entire Program.
              – Both CPs and SCs can be used to
                establish time-bound actions.




South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
      Annex A:
      Conditions Precedent and Special Conditions
      Undertake efforts to avoid the need for CPs/SCs!

      • Types of Conditions Precedent:
              • Remedy a capacity deficit, through hiring of staff (financial specialists, M&E
                experts, etc) or otherwise;
              • Administrative requirements, such as M&E or PSM plan, nomination of
                auditor, etc.;
              • Achievement of key milestones (mostly in terms of capacity), evidence of
                which is to be provided.

      • Types of Special Conditions:
              • Additional terms to the Grant Agreements;
              • Conditions to be met between disbursements;
              • Conditions applicable throughout the Program’s life (rolling conditions).


South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
Annex A: Implications from November Board
Decision on Initial and Continuing Commitments

• Recall that the final budget for Round 9 and NSA
  grants will be committed initially at 90%, with the
  final 10% possibly available 12 months after the
  Starting Date

• This provision (the 90/10 split) will be reflected in
  Annex A

• CP: The supplementary amount (the 10% amount)
  may be provided no earlier than 12 months after
  the Starting Date
      Standard Terms and Conditions
      The Standard Terms and Conditions are more
        than just legal mumbo-jumbo!

      • Describe in detail the obligations of the PR
        over the course of the entire grant

      • Knowledge of these terms is essential to
        successful implementation of the Grant

      • Compliance with Standard Terms and
        Conditions is as important as reaching PF
        targets

      • However, this document is often ignored

South and West Asia Regional Conference,
9-11 December 2009, Delhi, India
ST&C – Features of the Grant
• Art. 3 – The first disbursement of Grant funds
  determines the Phase 1 Starting Date

• Art. 10 – Process and timing of disbursements

• Article 19 – Procurement policy

• Art. 22 – Use of logo
ST&C – Representations and Warranties
• Legal capacity
  – the PR has status as a separate legal entity
• Necessary powers
  – the PR has the power to conduct business
• No legal claims
  – no current investigations (governmental or otherwise)
    against the PR
• No double funding
  – no duplicative funding
ST&C – PR and SR Audits
• PR must have an annual financial audit by an
  independent auditor
  – The audit report should be submitted no later than six
    months after the period under audit
• PR must also ensure the annual audit of SRs
  – A plan for conducting such audits should be provided
    no later than six months after the Starting Date
ST&C – SR Management
• The capacity of each SR to undertake proposed
  activities should be evaluated prior to selection
• Selection of SRs should be undertaken through a
  transparent, competitive process
• SRs should generally take on all the obligations of
  the PR
  – This includes the limitation on use of grant funds,
    reporting and audit requirements, and adherence to the
    QA policy
  – The transfer of these obligations should be
    accomplished through a SR grant agreement
SR Management
• The CCM, the PR and the SRs all play in an
  important part in the successful implementation of
  the Program, but ultimately it is the responsibility
  of the Principal Recipient to ensure that the
  Program is managed well ……
Practical Considerations – Moving the
Process Forward


• The Grant Agreement governs the relationship
  going forward through implementation

• Relevancy of the Grant Agreement at this stage:
  – Identification of areas that have slowed the process
Potential Obstacles to Grant
Implementation: Problems and Solutions
• Missing/incomplete documents near final stage
  – Engage in planning exercise with Regional Team
  – Set strict timelines with deliverables
• Limited understanding of procurement
  policy/quality assurance policies
  – Look to the template Standard Terms and Conditions
  – Liase with other PRs for sharing of
    experience/examples
• Lengthy period for execution of the Agreement
  – Understand the process
  – Plan for delays
Potential Obstacles to Grant
Implementation: Problems and Solutions
• Limited understanding of obligations/supporting
  materials re: SR management
  – Initiate planning early on
  – View description in Standard Terms and Conditions
    (Art. 14) as setting forth general principles/obligations
  – Look to Standard Terms and Conditions as template for
    SR agreement
  – Liase with other PRs for examples of calls for
    proposals/SR agreements
Potential Obstacles to Grant
Implementation: Problems and Solutions
• What are the issues prospective PRs are
  confronting at this stage?
• What issues most frequently arise, based on the
  expertise of the Regional Team?
• What are the most efficient pathways forward?

  – Opportunities to discuss these questions include this
    forum but extend beyond it
  – We encourage ongoing dialogue between PRs and with
    the Global Fund
 Please don’t hesitate to contact us or your FPMs to
             discuss these issues further

The Legal Team:

Roshan Ouseph
Roshan.Ouseph@theglobalfund.org

Samiha Husain Raza
Samiha.Raza@theglobalfund.org

								
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