Article 224

Financial instruments shall be based on ex ante evaluations identifying market imperfections or failures, or sub-optimal investment situations and assessing investment needs in view of the policy objectives. The ex ante evaluation shall demonstrate that identified market needs cannot be addressed appropriately and in a timely manner through either market led activities or types of Union intervention other than funding by a financial instrument, such as regulation, liberalisation, reform or other policy action. It shall assess the likelihood and possible costs of market distortions and crowding-out of private funding through the financial instruments and shall identify means to minimise negative effects of such distortions. In accordance with the principle of subsidiarity, the ex ante evaluation shall demonstrate that an Union-level financial instrument addresses identified market needs more appropriately than similar financial instruments at national or regional level, including those financed by CSF Funds. Factors such as difficult access to funding at national level, in particular for cross-border projects, economies of scale or strong demonstration effects linked to the diffusion of best practices to Member States shall be taken into account when assessing the added value of the Union contribution. The ex ante evaluation shall determine the most efficient mode for delivering the financial instrument. The ex ante evaluation shall also demonstrate that the planned financial instrument is consistent with: new and existing financial instruments, avoiding undesirable overlaps and achieving synergies and economies of scale; financial instruments and other forms of public intervention addressing the same market environment, avoiding inconsistencies and exploring potential synergies. The ex ante evaluation shall assess proportionality of the envisaged intervention with regard to the size of the identified funding gap, the expected leverage effect of the planned financial instrument and also examine additional qualitative effects, such as the diffusion of best practices, the effective promotion of Union policy objectives throughout the implementation chain or the access to specific expertise available from actors involved in the implementation chain. The ex ante evaluation shall establish a set of appropriate performance indicators for the proposed financial instruments and specify the expected output, results and impact. A separate ex ante evaluation of financial instruments shall only be carried out where such evaluation complying in full with the criteria in paragraphs 1 to 7 is not included in the ex ante evaluation or an impact assessment of the programme or activity covered by a basic act.

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Source: EUR-Lex (Cellar) · retrieved 2026-11-04 · Text as adopted (Official Journal); later amendments are not incorporated in this text.