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1. Where a project which has received financial support has not been carried out as planned, or where the conditions laid down are not fulfilled, the financial support may be reduced or cancelled by a decision adopted by the Commission. Any sum incorrectly paid shall be repaid to the Community by the recipient concerned within 12 months of the date of notification of such decision.

2. Without prejudice to checks carried out by the Member States in accordance with national laws, regulations or administrative provisions, and without prejudice to Article 206 bis of the Treaty or to any inspection arranged on the basis of Article 209 (c) of the Treaty, on-the-spot checks or enquiries in respect of projects receiving financial support shall be carried out by the competent authorities of the Member State concerned and by representatives of the Commission, or other persons authorized for this purpose by the latter. The Commission shall determine deadlines for the performance of checks and inform the Member State in advance in order to obtain all the necessary assistance.

3. The purpose of these on-the-spot checks or enquiries relating to operations receiving financial support shall be to ascertain:

(a) the conformity of administrative practices with Community rules;

(b) the existence of supporting documents and whether they correspond to the projects receiving financial support;

(c) the conditions under which operations are executed and checked;

(d) the conformity of the execution of projects with the conditions for granting the financial support.

4. The Commission may suspend payment of the financial contribution in respect of an operation if a check reveals irregularities or a substantial change in the nature or conditions of the project for which the Commission's approval has not been sought.