Introduction to FP7:
Grant Agreements and Financial Issues
University of Bristol
19 May 2011
Emma Carey
emma.carey@bbsrc.ac.uk
http://www.ukro.ac.uk
Arts and Humanities Research Council
Biotechnology and Biological Sciences Research Council
UK Research Office
Economic and Social Research Council
2
Engineering and Physical Sciences Research Council
Medical Research Council
Natural Environment Research Council
Science and Technology Facilities Council
UKRO’s Aim
UK Research Office
…promotes effective UK participation in EU-funded
research, innovation and higher education programmes,
and other related activities…
Based in Brussels, UKRO:
•
•
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Provides early insight and briefing;
Disseminates EU funding opportunities;
Provides high quality guidance and training;
Exchanges information between the UK and EU
UKRO Services include
• Website:
• with information on programmes, FAQs & guidance http://www.ukro.ac.uk
•
Information services
UK Research Office
• e-mail updates (& searchable database) http://ims.ukro.ac.uk
•
•
•
•
Enquiry service
Annual visit from your UKRO European Advisor
Specialist training courses and information events
Annual conference for European officers
• Meeting room in Brussels
• Monthly publication - British Council ‘European RTD Insight’
• National Contact Points (Marie Curie and ERC)
FP7 Overview, Eligible Countries,
and Grant Cycle
Opportunities available
Plus JRC
and Euratom
Co-operation – collaborative research
Capacities
Health
Research Infrastructures
Food, Agriculture and Fisheries, and Biotechnology (FAFB/KBBE)
Information and Communication Technologies (ICT)
Nanosciences, Nanotechnologies, Materials
and new Production Technologies (NMP)
Research for the Benefit
Of SMEs
Energy
Research Potential
Environment (including Climate Change)
Science in Society
FP7 Overview
Transport
Socio-Economic Sciences and the Humanities (SSH)
Space
Security
Ideas – European Research Council (ERC)
Starting Independent Researcher Grants
Advanced Investigator Grants
Support Actions/Calls for Tender
Regions of Knowledge
Activities of International
Co-operation
Coherent Development
of Policies
People - Marie Curie
Individual Fellowships & Reintegration Grants
Initial Training Networks
Industry-Academia Partnerships and Pathways
International Research Staff Exchange Scheme
Researcher’s Night
Who is eligible for funding?
FP7 Overview
EU-27
Austria, Belgium, Bulgaria, Cyprus, Czech Republic,
Denmark, Estonia, Finland, France, Germany, Greece,
Hungary, Italy, Ireland, Latvia, Lithuania, Luxemburg, Malta,
Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia,
Spain, Sweden, UK
Associated Countries (FP7)
Albania*, Croatia*, Faroe Islands*, FYR Macedonia*,
Iceland*, Israel*, Liechtenstein*, Montenegro*, Norway*,
Serbia*, Switzerland, Turkey*, Bosnia and Herzegovina*
*except Euratom
Eligible
for EC funding

JRC


Legal entities in
EU member states
or ‘Associated Countries’ (AC)
Legal entities in
International Co-operation
Partner Countries (ICPC)

International
European
Interest
Organisations

International organisations & non-ICPC third countries, only if:
- Mentioned in Specific Programme or Work Programme, OR
- Essential for carrying out the action, OR
- Provided for in a bilateral agreement with the EC
Other countries / organisations (but with NO FUNDING from the EU)
FP7 Overview
International
International Co-operation:
Co-operation and Capacities
Working with third countries (=non EU/AC countries), can either be:
- Specified by the Commission
Called a Specific International Cooperation Action (SICA) that require at least four
participants: two in Member States or Associated Countries, two in ICPC
- Suggested by the Commission
if so, participation of international organisations and participants from third countries is in
addition to normal minimum requirements
FP7 Overview
- Initiated by the researcher
if so, participation of international organisations and participants from third countries is in
addition to normal minimum requirements
International Cooperation Partner Countries (ICPC)
are listed in Annex 1 of the Work Programme
• Western Balkans countries
• Mediterranean Partner countries
• Eastern European and Central Asian countries
• Africa Caribbean Pacific
• Latin America
• Asia
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Application and Negotiation Process
Final
Work
Programme
Consortium
Agreement
Activities
ESR
Application
Ranking
Decision
(via EC or
Co-ordinator)
Budget
Consortium
FP7 Overview
Consortium
Agreement
Authorisation
Negotiation
Grant
Agreement
Preparation of
Grant Agreement
Consortium
Agreement
Project
Start
Project
Account
Staff
Recruitment
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Grant
Agreement
Negotiation
Project
Account
Project
Start
Project
Implementation
FP7 Overview
Consortium
Agreement
Commission
Pre-financing
Kick off
Meeting
Start
Certificate on
Financial
Financial Statement
Reporting
Scientific
Reporting
Interim
Reporting
Staff
Recruitment
Final
Reporting
Interim
Payment
Finish
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Key documents
Call Fiche (specific)
Focus
Work Programme (usually annual)
Guide for Applicants (call and funding scheme
specific)
Submission
EPSS Guide
FP7 Overview
Rules on Submission and Evaluation
Background
Model Grant Agreement, Model Consortium
Agreements, Consortium Agreement check list
Updatable Financial, Negotiation, IPR,
Certification and Reporting Guidelines
Rules of Participation
FP7 and Specific Programme Text
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Introduction to FP7 Finances
Who makes the rules on finances?
Intro to FP7 Finances
EU
Financial
Regulations
EU Court
of Auditors
European
Commission
UK Rules
FP7
Eligible
Costs?
Normal
practice of
organisation
Department
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Intro to FP7 Finances
Introduction to FP7 Finances
• Co-financing principle
• Main principle: usually based on reimbursement of
direct and indirect costs
• But sometimes lump sums or flat rates in certain
actions
• No need for hard cash own contribution
• No profit
• No commercialisation activities
• Based on reimbursement of eligible costs
• Different project types/funding limits/funding rates
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Eligible Costs: principles
• Costs are eligible if:
Intro to FP7 Finances
• Actual
• Incurred by the beneficiary during the project
• Determined according to usual accounting and
management principles
• Used solely for project objectives*
• Consistent with principles of economy, efficiency and
effectiveness
• Recorded in accounts
* Replaces the FP6 provision of ‘necessary’
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Non-eligible Costs
Intro to FP7 Finances
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•
•
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Identifiable indirect taxes including VAT
Duties: the amount assessed on an imported or
(less often) exported item
Interest owed
Provisions for possible future losses or charges
exchange losses, cost related to return on capital
costs declared or incurred, or reimbursed in respect
of another Community project (avoiding double
funding )
debt and debt service charges, excessive or
reckless expenditure
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Intro to FP7 Finances
Definitions
• Direct costs - Direct costs are all those eligible costs
which can be attributed directly to the project and are
identified by the beneficiary as such, in accordance with its
accounting principles and its usual internal rules.
• Indirect Costs - Indirect costs are all those eligible costs
which cannot be identified by the beneficiary as being
directly attributed to the project, but which can be
identified and justified by its accounting system as being
incurred in direct relationship with the eligible direct costs
attributed to the project.
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Indirect Costs
Intro to FP7 Finances
Choice of method used:
•
has to be made at Institutional level
•
and used in all FP7 areas - except Marie Curie Actions and ERC
Method
Indirect Cost Rate
Who can use this method?
Specific Flat Rate
60%
Available to universities, non-profit public
bodies, secondary and HE establishments,
and SMEs which are unable to indentify with
certainty their real indirect costs
Standard Flat Rate
20%
Available to all
Real Indirect Costs
Rate and basis determined
by organisation
Available to all
Simplified Method
Rate and basis determined
by organisation
Available if unable to calculate project level
indirect costs. May be certified independently
and accepted by Commission
Special Cases
•
ICPC lump sums - cover direct and indirect costs
•
CSA - maximum of 7% for indirect costs
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Intro to FP7 Finances
Maximum reimbursement rates*
FP7 –
Industry
FP7 –
Public Bodies,
Universities,
SMEs, etc.
RTD
50%
75%
Demonstration
50%
50%
Other**
100%
100%
** Co-ordination and Support Actions, Training, Management
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Intro to FP7 Finances
Reimbursement of Costs:
Flat Rate – 60%
Calculate the direct costs:
Reimbursement as follows:
•
RTD Costs = €100,000
•
RTD: 75% of (€100,000 + €60,000) =
€120,000
Demonstration Costs =
€100,000
•
Management Costs: =
€100,000
Calculate the indirect costs:
•
RTD: €100,000 x 0.6
= €60,000
•
Demo: €100,000 x 0.6
= €60,000
•
Mgt: €100,000 x 0.6
= €60,000
Demo: 50% of (€100,000 + €60,000)
= €80,000
Mgt: 100% of (€100,000 + €60,000)
= €160,000
Note that any subcontract costs must be
taken out of the direct costs to calculate
the correct indirect costs.
Total to be reimbursed = € 360,000
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ICPC Lump Sum Option
• ICPC partners can elect to use lump sum payments for a
whole project (instead of reimbursement of eligible costs)
Intro to FP7 Finances
• Applies for the duration of the Grant Agreement (contract)
• Method can vary between projects – so should consider
options for each individual one
• Lump sums include all project costs (personnel, travel,
equipment, overheads, etc.)
• Calculated on basis of full-time researchers per year
• Requirement to keep evidence of time spent on project
• Rates vary according to country income
• Maximum reimbursement rates still apply
Intro to FP7 Finances
ICPC Lump Sums – rates
Economy of the ICPC
country
Low income
EC contribution per
researcher per year
€8,000
Lower middle income
€9,800
Upper middle income
€20,700
List of ICPC economies can be found in:
Guide to Financial Issues
Example of funding in a CSA:
DIRECT COSTS
•
EC fund 100% of direct costs
Intro to FP7 Finances
Direct costs (including €20 000 for subcontracting)
€ 200 000
INDIRECT COSTS
•
EC funding for indirect costs is maximum (not flat rate)
of 7% of the direct costs (excluding subcontracting and
also excluding the costs of resources made available by
third parties which are not used on the premises of the
beneficiary )
Direct costs excluding subcontracting
= €200 000 – € 20 000 = € 180,000
Therefore maximum total indirect costs
= 7% of €180 000 = €12 600
€ 12 600
TOTAL EC FUNDING
Direct Costs (incl. for the subcontract) + Indirect Costs € 212 600
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Participant Portal
Participant Portal – Basics
Participant Portal
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•
•
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Offers external stakeholders (participants, LEARs, coordinators, reviewers) a unique entry point in handling grantrelated actions, based on a
 single sign-on (ECAS)
 role-based authorization (Identity and access management – IAM)
Common umbrella for the different FP7 IT tools
Result: personalised services on the Portal, personalised access
to
 Legal entity registration
 Financial Capacity Check
 Negotiation + Amendments
 Financial and scientific reporting
Homogeneity and better service integration for grant
management
• http://ec.europa.eu/research/participants/portal
27
Unique Registration Facility (URF)
Unique Registration Facility (URF)
• Why introduce the URF?
• In FP6 legal data required at both submission and negotiation stages
• In FP6 most organisations validated for legal existence and status for
every contract
• Participant Identification Code (PIC)
• One Legal Entity = One PIC (Used for FP7 & CIP)
• New participants could register from 1 May 2008
• Legal Entity Appointed Representative (LEAR)
• One Legal Entity = One LEAR
• Only LEAR can request modification of the admin and financial data of
your organisation in URF (will not be able to do it in NEF anymore)
• Further information
•
•
•
•
http://cordis.europa.eu/fp7/pp_en.html
http://cordis.europa.eu/fp7/pp-pic_en.html
Helpdesk – DIGIT-EFP-SUPPORT@ec.europa.eu
Feedback – RTD-DL-URF@ec.europa.eu
Participant Portal
Currently, the Participant Portal is the gateway to access:
1) The Unique Registration Facility (URF);
Participant Portal
2) The FP7 Negotiation Facility NEF (for co-ordinators);
3) The new FP7 documentation search functionality
4) The SESAM tool for technical reporting
5) The FORCE tool for financial reporting
6) The “Manage Roles” facility
7) *NEW* Information and Documentation on FP7 Calls
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Participant Portal: Identity and Access
Management (IAM) - ECAS
Participant Portal
●
Delegation and assignment of roles by the
consortium itself:
 By default the contact person from the proposal is
provisioned as Co-ordinator Contact in the Portal.
 Co-ordinator contact changes are managed from NEF
by the Commission Project Officer (under ‘Portal
coordinator contact person’).
 The Co-ordinator Contact can set/change the
Participant Contact roles in the Portal (without further
interference by the Commission).
 Further representatives for the entity can be named by
the Co-ordinator and Participant Contacts for a given
entity.
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Project Stages
Project Stages
1) Proposal Preparation
2) Evaluation
3) Negotiation
Project Stages
4) Project Start/Implementation
5) Project Reporting
6) Project Closure
7) Post-Project Tasks
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Project Stage – Proposal Prep
1) Proposal Preparation
Contractual and Financial Aspects
• Which Funding Scheme?
• Planning budget
•
•
•
•
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Share of costs amongst consortium
Often strict EC contribution limit imposed
Planning project resources – equipment, subcontracting
Lump sums for ICPC countries
Discussion of consortium agreement
•
Management Structure, IPR and Procedures
33
Project Stage – Proposal Prep
FP7 Project Types
FP7 Co-operation and Capacities have 5 main project types:
•
Collaborative Projects
•
S/M Scale Collaborative Projects (Small CP/ Strep)
•
Large Scale Collaborative Projects (Large CP/ IP)
•
Networks of Excellence (NOE)
•
Coordination and Support Actions (CSA)
•
Co-ordinating (CSA-CA)
•
Supporting (CSA-SA)
These may also have extra conditions:
•
Specific International Co-operation Actions (SICA)
•
Research for the benefit of specific groups (SMEs/CSOs)
•
Public Private Partnerships (PPPs)
•
ERA-NETs (and ERA-NET Plus
•
Research Infrastructures projects (CP+CSA combined)
Other project types:
•
FP7 Ideas - European Research Council (ERC)
•
FP7 People - Marie Curie Actions
34
FP7 Funding Schemes
FP7 – Funding Schemes
Co-operation
Theme
Collaborative
Projects
(S/M)
Collaborative
Projects
(L)
Co-ordination
and Support
Actions
Health
Max €6 million
(eligibility criteria)
Must be from €6 to
12 million
(eligibility criteria)
Limits depend on
call (eligibility
criteria)
ICT
No firm limits
No firm limits
No firm limits
Socio-Economic
Sciences
Max €2.7 million
(eligibility criteria)
Min €6.5 with min
7 partners
(eligibility criteria)
No firm limits but
call specific
2011
Project Stage – Proposal Prep
Types of Activity:
Co-operation and Capacities
Refer to guidance for each project (e.g. Guide for Applicants)
1) RTD Activities: directly aimed at creating new knowledge, new
technology, and products, including scientific coordination.
2) Demonstration activities: designed to prove the viability of new
technologies that offer a potential economic advantage, but which
cannot be commercialised directly (e.g. testing of products such as
prototypes).
3) ‘Other’ activities: dissemination, networking, co-ordination,
intellectual property, socio-economic impact studies, feasibility
studies for commercial exploitation
4) Management activities: overall legal, ethical, admin. and financial
management, pass on EC funds, keep project records and
accounts, review project reports and tasks, monitor beneficiaries,
project manager, competitive calls
5) Training activities: costs of providing training, including salary costs,
but not the salary costs of those being trained
36
Project Stage – Proposal Prep
Management Costs
•
Management of the consortium activities includes:
•
maintenance of the consortium agreement, if it is obligatory,
•
the overall legal, ethical, financial and administrative
management including [for each of the beneficiaries]
obtaining the certificates on the financial statements or on the
methodology,
•
implementation of competitive calls by the consortium for the
participation of new beneficiaries, where required by Annex I
•
obtaining any financial security such as bank guarantees,
when requested by the Commission,
•
any other management activities foreseen by the annexes,
except coordination of research and technological
development activities.
•
Management tasks cannot be subcontracted
37
Project Stage – Proposal Prep
Group Exercise:
Cost Category Activity
Exercise: allocate costs from the list below into the types of activity
for a collaborative project
Principal lecturer – 20% time
Technician – 100% time
PhD student – 100% time
PhD fees
Replacement teaching time
Cost of project manager
IT support staff
Admin support
New microscope (depreciation over 10
years)
Office PC
1000 test tubes
Prototyping of new drug
Miscellaneous consumables
Paper
IT network charge
VAT
Airport tax
Flight to Rome for project
management meeting
Flight to Dublin for research work
package meeting
Flight to USA for research conference, 1st
class
Carbon-neutral charge when booking a
flight
Admission to Windsor Castle for
members of project steering
committee
Dinner for project steering committee
Publishing and dissemination of project
material to public
Certificate on financial statements
Certificate on methodology
Website design
Subcontracting of blood sample analysis
Consultant time in writing original
proposal
Exchange rate loss as Euros no longer
cover pound expenditure
Feasibility study
Transportation and set-up costs for
equipment
Internal invoices
Eligible?
If so, which category?
RTD / Demo / Other /
Management / Training
Direct or Indirect?
38
Project Stage – Proposal Prep
Costs you can be reimbursed for
(…but which you might not expect)
Financial responsibility up to each participant:
•
•
•
•
•
•
•
•
Choice of staff resources (can incl. PhD Students)
Patents – filing and searches
Employing a project manager
Dissemination (website, publication fees…)
Travel outside Europe
Equipment (under certain conditions)
Studies on socio-economic impact
Feasibility studies for spin-offs
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Project Stage – Proposal Prep
Tips for Budgeting in Proposals
• Discuss budget early
• Costs of activities discussed first
• Share of costs amongst consortium
• Procedure for changing this share if necessary
• Keep in mind limits imposed by Commission
• Researchers and Administrations should both be
involved
• Guidelines on Finances, Negotiation and Reporting…
• Previous FP6/FP7 experience of managing,
budgeting and reporting is useful background
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Project Stage – Proposal Prep
Proposal format
•
Part A (Online forms A1, A2, A3)
•
•
•
Basic info – call details, title, summary, partners, budget
Participant Identify Code (PIC) - a unique organisational
identifier
Part B (Upload as pdf)
•
•
•
Cover Page
Table of Contents
Main part of the proposal
•
•
•
•
•
Science and Technology
Implementation (Management, participants/consortium,
appropriateness of allocation of resources: staff, equipment…)
Impact
Ethical Issues
Consideration of gender issues
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Establishing Projects
EPSS A3 Forms – Collaborative
Project
2) Evaluation
Project Stage – Evaluation
Feedback from Evaluators (ESR):
• Budget is considered as one aspect of the evaluation
•
•
‘Appropriateness of the allocation and justification of the
resources to be committed (budget, staff, equipment)’
In addition ESR provides comments on all aspects of
evaluation criteria (S&T Quality, Implementation and
Impact) including:
•
•
•
•
•
Soundness of concept, and quality of objectives
Activities
Management structures/procedures
Structure and quality of consortium
IPR and dissemination plan
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3) Negotiation
Project Stage – Negotiation
•
Based on ESR
•
•
Negotiation of key aspects:
•
•
•
•
•
•
•
•
•
Interpretation of project officer
activities,
budget,
partnership,
reporting requirements
Building towards consensus on the grant agreement
Simultaneous finalisation of Consortium Agreement
NEF system available in Participant Portal
Legal and financial viability check
Signature
44
Participant Portal – NEF
Project Stage – Negotiation
STRUCTURE OF THE DESCRIPTION OF WORK (DoW)
•
The Description of Work, which is Annex I to the Grant Agreement,
contains the details of the implementation of the project with regard
to the work packages, deliverables, milestones, resources and costs
of the beneficiaries – organised in a table format - as well as a
detailed narrative description of the work. It consists of two parts:
Part A of Annex I contains:
•
- the cover page,
•
- the project summary,
•
- the list of participants and the budget breakdown
•
- 8 Workplan Tables, which provide details on the implementation
of the project
Part B of Annex I is based on information from Part B of the proposal.
However, during the negotiation stage several sections of the original
proposal need to be updated and the Consortium may be requested to
shorten certain sections of the proposal and elaborate on others.
45
Project Stage – Negotiation
Participant Portal – NEF
• Use the online tool NEF (NEgotiation Facility) to prepare
DoW:
• Only two “work tables” (list of WP and WP description) need
to be edited, all other tables are generated automatically and
adapted/re-calculated when the original tables are edited.
• Information on deliverables is transferred into the reporting
tool and does not need to be re-entered at the time of
reporting.
• Part A of the Description of Work = Work tables.
• Part B of the DoW = narrative part, based on part B of the
proposal: uploaded into NEF by the co-ordinator as a
Word/pdf document (max. 20MB) during negotiations
• NEF will create out of the two files the Description of Work
(Annex I)
46
Project Stage – Negotiation
The negotiation process (1)
The following forms need to be submitted to the
EC Project Officer:
1) First drafts of Annex I to the Grant Agreement
2) Grant Agreement Preparation Forms (GPFs) via
the NEF tool
3) Supporting documents that verify legal
existence and status of beneficiaries (if you have
no PIC)
4) Financial documents for financial viability
checking (request is more than €500,000, done
only once for each institution throughout FP7)
47
Project Stage – Negotiation
The negotiation process (2)
•
EC Project Officer will indicate changes or
improvements to the submitted forms
•
Consortium responds and negotiates with EC
Project Officer until agreement is reached
•
Meetings between Consortium and EC may
be required
•
Process should be concluded before
deadline for completion of negotiations
48
Project Stage – Negotiation
Important points to remember
•
An invitation to start negotiation does not, under any circumstance,
guarantee the funding of a project or the offer of a grant agreement.
•
The funding of the proposal may depend on the Consortium’s
acceptance of changes requested by the Commission services in the
Negotiation Mandate.
•
The maximum amount of funding for a project is fixed in the
negotiation mandate.
•
EC can terminate negotiations or request a change in consortium if it
doubts the financial and human resources available to carry out the
proposed work.
•
If negotiations are not completed within the given time limit, the EC
may terminate negotiations.
•
•
•
Further information:
FP7 Negotiation Guidance notes
NEF User’s Guide for Co-ordinators and Participants
49
Project Stakeholders
Project Stakeholders
European
Commission
Project Stakeholders
Partner 1
(Co-ordinator)
Partner 2
License
Partner 3
Partner 4
Third Parties
51
Project Officer
Project Stakeholders
•
•
•
•
•
•
Appointed to a project at start of grant agreement
negotiation stage
Essentially the EC’s representative
Responsible for project negotiations towards final
grant agreement and start
Responsible for monitoring, interim reporting, and
processing of finances
Responsible for signing off project
Productive, open, regular contact with project officer
is vital, via the co-ordinator
52
Co-ordinator
•
•
Project Stakeholders
•
•
•
•
•
•
Essentially, one beneficiary who has extra responsibility (but
not necessarily extra rights)
Must pass on pre-financing (as agreed by beneficiaries in
consortium agreement)
Responsible for reporting to the Commission (finances,
payments, task progress…)
Must pass on information regarding performance obligations of
project to beneficiaries
These co-ordination tasks cannot be subcontracted, nor carried
out by other beneficiaries
Must report on interest gained from EC pre-financing in their
account
Management activities are not merely co-ordination tasks
Good contact and honesty with co-ordinator is also very
important
53
Participants/Beneficiaries
•
•
Project Stakeholders
•
•
•
•
•
Organisations signed up to the Grant Agreement
Each beneficiary has consortium and individual
responsibilities
Beneficiaries should normally have the capacity to
do the project (as they signed up to it)
Must be seen to be working together
Responsible for managing own performance and
finances – including declaring receipts
Responsible for performance of any subcontractors
they are attached to
Researchers involved in projects must make own
arrangements/fit in with policy requirements to work
together with other project stakeholders at their own
organisation
54
Project Stakeholders
Third Parties
• Organisations which are not signed up
to the grant agreement
• Make some contribution to the project
• Must be identified in project
negotiations, or raised with Project
Officer subsequently
• Subcontractors are one type of third
party
55
Subcontractors
•
Project Stakeholders
•
•
•
•
•
•
Type of 3rd Party, not a beneficiary, but does
specialised work on behalf of a beneficiary
Subcontractor charges price for the work, and paid
100%
Not directly supervised, but beneficiary takes
responsibility, and owns IP generated
Beneficiary pays subcontractor either using EC
contribution or own funds
Not for core parts of project, management or
research
Not for subcontracting research between
participants
Must be identified in Annex I, and ‘best bid’ accepted
56
FP7 Grant Agreements
FP7 Grant Agreement
Section
Name
Purpose
Grant
Agreement
Core
Adapted to each individual project, confirming beneficiaries, start
date, duration, budget and reporting periods for example
Annex I
Description of
Work
Covers technical side of project – developed from proposal
Annex II
General
Conditions
The same for all projects under Co-operation/Capacities, modified
for ERC and Marie Curie (which both offer Single or Multibeneficiary versions)
FP7 Agreements
Annex III
Extra conditions for certain areas (e.g. SME Actions, Infrastructures)
Annex IV
Form A
Used to accede to agreement
Annex V
Form B
Used to add new beneficiaries
Annex VI
Form C
Financial Statement
Annex VII
Form D (New in
FP7)
Terms of reference of the certificate on the financial statements
(known as the Audit Certificate in FP6)
Form E (New in
FP7)
Terms of reference for the certificate on the methodology (new to
FP7) - for beneficiaries who want to get average personnel costs
certified and/or for those who are unable to calculate real indirect
costs and want to have a simplified method of calculating these
certified
Core Grant Agreement
• Signature of EC and Co-ordinator (accession within 45
days of participants)
• Names and legal representatives of participants
FP7 Agreements
• Duration and start of project
• Reporting periods
• EC total contribution to project (broken down in Annex I)
• Amount of pre-financing (and Guarantee Fund)
• Special Clauses (to be negotiated)
• Applicable law
59
Grant Agreement – Annex II
Generic to all projects – (separate versions for ERC and MC):
• Definitions
• Roles of co-ordinator and participants (beneficiaries)
• Periodic reporting
• Use of certificates (financial statements, methodology)
FP7 Agreements
• Payment modalities
• Subcontracting
• Confidentiality
• Financial provisions (costs, funding limits, receipts, pre-financing,
interest yielded)
• Financial and technical audits
• Intellectual Property Rights – use and dissemination
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Consortium Agreement
• Mandatory unless specified in call for proposals
• Internal organisation of the consortium, including:
• Financial arrangements e.g. pre-financing
• Settlement of disputes e.g. non-performance
FP7 Agreements
• Additional Intellectual Property arrangements e.g. licensing
• Liability and confidentiality
• Commission Consortium Agreement checklist established
• NOT signed by the Commission
• Usually drafted and disseminated by Co-ordinator
• Models such as DESCA and IPCA can be adapted
61
Access Rights FP7
Access rights to
background
Access rights to
foreground resulting from
the project
FP7 Agreements
Yes, if a participant needs them for carrying out its own
work under the project
For carrying
out the
project
For use
(exploitation
+ further
research)
Royalty-free
unless otherwise agreed
before acceding to the
grant agreement*
Royalty-free
Yes, if a participant needs them for using its own
foreground
Either fair and reasonable conditions or royalty free- to
be agreed
Please note that the rules for Research for the Benefit of SME/CSO projects are also different
62
IPR Conditions - Background
FP7 Agreements
Background:
Information which is held by beneficiaries prior to their accession to the
grant agreement, as well as copyrights or other intellectual property rights
pertaining to such information, the application for which has been filed
before their accession to the agreement, and which is needed for carrying
out the project or for using foreground.
Key issues:
• Confidentiality agreement before project negotiations?
• Beneficiaries define background needed
• Where appropriate exclude certain items
• Access rights must be requested, and intended purpose made clear
• Exclusive licences possible
• Does this make for a workable project?
63
IPR Conditions - Foreground
Foreground:
FP7 Agreements
The results, including information, whether or not they can be
protected, which are generated under the project. Such results
include rights related to copyright; design rights; patent rights;
plant variety rights; or similar forms of protection.
Key issues:
• Confidentiality – all material for up to five years after project end
• Ownership – party generating owns, joint ownership conditions
apply
• Transfer of ownership – 45 day notice required
• Protection – commercially exploitable IP must be protected
• Use – participants must use or ensure that foreground is used
• Dissemination – as swiftly as possible, 45 day notice required
• EC support must be acknowledged
64
Project Stage – Project Start
4a) Project Start
•
•
•
•
•
•
After signature of grant agreement
Agreed start date
Kick-off meeting
Initial allocation of pre-financing done by Coordinator (as per Consortium Agreement terms)
Start of work packages
Plan towards first review
Some flexibility with resources once the project is up
and running…
65
Project Start – Pre-financing
Project Stage – Project Start
•
Single pre-financing paid at the start of the project
(Article 6 of the ECGA)
•
•
•
Paid to Co-ordinator once min. number of participants
have acceded and only paid to those that have acceded
•
•
•
•
10% of EC contribution is always retained by the Commission
5% for Guarantee Fund, also part of pre-financing and
immediately subtracted
For projects of 1 to 2 reporting periods, pre-financing could be
60-80% of total EC contribution
For projects > 2 reporting period, prefinancing = 160% of the
average funding per period
Circumstances of project can influence this e.g. loading of
expenditure
Pre-financing remains the property of the Commission
until the last payment
66
Project Stage – Project Start
Pre-financing – Worked Example
Example: 3 yr project with €3,000,000 EC contribution
with annual reporting
•
•
•
Average EC contribution per reporting period:
€3,000,000 / 3yrs = €1,000,000
Pre-financing (usually 160% of €1,000,000) mentioned in
Article 6= €1,600,000
Contribution to Guarantee Fund at 5% of total EC
Contribution: 3,000,000 x 5% = €150,000
Net amount transferred to Co-ordinator: (€1,600,000 –
€150,000) = €1,450,000
67
Interest on Pre-Financing
Project Stage – Project Start
•
GA II.6.5 ‘The bank account mentioned in Article 5.3 shall allow that the
Community financial contribution and related interest are identified.
Otherwise, the accounting methods of the beneficiaries or intermediaries
must make it possible to identify the Community financial contribution and
the interest or other benefits yielded’
What’s in the Guidelines?
•
Recommended that bank account of co-ordinator is used exclusively for
project funds
•
Co-ordinator must be able to identify payments made/received at any
moment
•
This includes identifying interest generated on pre-financing held by coordinator
•
Such interest is viewed as a receipt to be offset/recovered
•
Participants do not have to identify interest on the pre-financing they receive
•
Security research projects may insist on a separate bank account/ sub
account
68
Project Stage – Project Start
Guarantee Fund
• New in FP7 to lower barriers to SME involvement
• A kind of insurance contract to guarantee the
financial losses of the projects
• 5% of EC contribution transferred by the
Commission to the Guarantee Fund
• Returned to the beneficiaries via the Co-ordinator
at the moment of the final payment, at the end of
the project;
• A maximum deduction of 1% of the EC
contribution may be applied to some beneficiaries
(not public bodies) see Article II.20 of GA.
69
Payments
Project Stage – Project Start
Example continued:
3 yr project (with annual reporting) with total €3,000,000 EC contribution
Maximum payments during project = 85% of total = 2 550 000
(as 5% retained for Guarantee Fund and 10% retained by EC)
Payment
Amount received
Cumulative amount
received to date
Pre- financing
As per pervious
example
1 450 000
1 450 000
1st reporting
period
EC contribution
accepted
€ 900 000
1st Interim payment €900 000
2 350 000
2nd reporting
period
EC contribution
accepted
€ 900 000
2nd Interim payment € 200 000
(due to retention – since can not go
above cumulative total of 2 550 000)
2 550 000
Final report
EC contribution
accepted
€ 1 200 000
Final payment € 450 000
(= the total EC contribution accepted
over the whole project minus the
cumulative amount received so far)
3 000 000
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Project Stage – Implementation
4b) Project Implementation
•
•
•
•
•
Recruitment of staff
Pre-financing into partners’ project accounts
Work towards first (internal) review?
Commission review (reporting) every 12 to 18
months
Monitoring of activities
71
Project Stage – Implementation
Issues during project
•
•
•
•
•
•
•
New joiners
Leavers
Changing institution
Bankruptcy
Contract amendments
Non-performance
Moving finances/cost headings
72
Project Stage – Project Reporting
5) Project Reporting
•
Simplification: 18 month reporting periods, less paperwork
•
Consortium submits a periodic report within 60 days after
the end of each reporting period
•
•
•
•
•
Overview of progress of project, achievements and
milestones as per Annex I, including publishable
summary
Explanation of the use of resources
Financial Statement from each beneficiary
Summary Financial Report
Commission to evaluate reports and disburse payments
within 105 days unless time limit or payment suspended
73
Project Stage – Project Reporting
Scientific Reporting
• Online tool for preparation and submission of
periodic and final scientific FP7 reports, project
technical reviews by external experts (SESAM)
• Deployed under the Participant Portal
• Use has become mandatory from 1 March 2010
• Quick guides available at:
http://webgate.ec.europa.eu/sesam
74
Project Stage – Project Reporting
Periodic Reporting
75
Project Stage – Project Reporting
Cost Claims – Form C
• Form C – models available per funding
scheme
• Report by partner
• Per activity type (e.g. RTD, Demo, Mgt,
Other)
• Show total and max EC contribution
• Show receipts
• Third party completes attached form (only
under Clause 10)
76
Project Stage – Project Reporting
FORCE: Online Form C
• DG Research use FORCE – web-based tool to edit,
save, print and submit FP6 and FP7 FORM C:
• Prepare FORM C online for each project and each
partner
• Print Form C
• Submit electronically Form C
• Signed paper version to be sent afterwards
• Correction of Form C in case of errors/refusal of EC
• Access via ‘Participant Portal’
77
Project Stage – Project Reporting
FORCE: Online Form C - Printed
78
Project Stage – Project Reporting
FP7 Periodic Report:
Process from a Participants point of view
79
Project Stage – Project Reporting
Reporting Costs for CSA
Co-ordination and Support Actions
• Indirect costs are ‘up to 7%’ of direct costs (minus
subcontracting)
• How to report costs:
• Flat-rate (60%)
• No RTD costs here, so the default is the 20% flat-rate – enter 20% (minus
subcontracting) and can claim back 7% in EC contribution row
• Indirect costs are not audited or certified due to being a ‘flat-rate’
• Actual Indirect Costs (simplified or real)
• Declare actual indirect costs in form and claim total up to 7% back in EC
contribution row
• Indirect costs are auditable and included in certificate on financial statements
(if required)
80
Project Stage – Project Reporting
EC Guidance for Time-sheets
(or equivalent)
•
Can only claim for hours worked
•
Kept by ALL staff working on the project
•
Full name of beneficiary as indicated in the GA;
•
•
•
•
•
•
full name of the employee directly contributing to RTD project;
title of RTD project as indicated in the GA;
project account number should be indicated;
time period concerned (for instance on daily, weekly, monthly basis) according to
the beneficiary's normal practice;
amount of hours claimed on the RTD project. All hours claimed must be able to be
verified in a reliable manner;
full name and a signature of a supervisor (person in charge of the project).
•
The complete time recording system should enable reconciliation of
total hours in cases where personnel work on several projects during
the same period
•
Can also be useful for equipment – if it is within normal practice
Project Stage – Project Reporting
Example Timesheet – Guide to FP7
Financial Issues
Project Stage – Project Reporting
Certificates on Financial Statements
•
•
•
•
Provides independent opinion on the claims
made by the Form C
Either external auditor or if public body can be
done by ‘competent public officer’
Annex VII Form D – provides terms of reference
for auditors and procedures to be performed by
auditor
Looks at Personnel Costs, Subcontracting,
Other Direct costs (equipment, consumables,
travel), indirect costs (possible methods?), use
of exchange rates, receipts and interest on prefinancing (Co-ordinator only)
83
Project Stage – Project Reporting
Certificates on Financial Statements
•
•
•
•
•
Required for each period when a beneficiary
is claiming more than €375,000
(cumulatively)
Not required otherwise, even at end of project
Exception of two year projects – not required
if over €375,000 in first year, only at end
Eligible cost as ‘management activity’ (100%)
Suggest meeting with auditors for FP7
projects early to discuss requirements and
costs
84
Project Stage – Project Reporting
Certificates on Financial Statements
•
•
•
•
•
(1) Cumulative EC contribution = EUR 190,000 + EUR 205,000 = EUR 395,000. A CFS has to be provided
because cumulative amount > 375,000. After the submission of CFS, the calculation of the cumulative amount restarts from 0 for period 3.
It is important to remember that the CFS has to cover the eligible costs for the two periods (EUR 380,000 + EUR
410,000 = EUR 790,000), and not just the EC contribution
(2) Cumulative EC contribution = EUR 250,000 +EUR 175,000 = EUR 425,000. A CFS has to be provided
because the cumulative amount > 375,000. After the submission of the CFS, the calculation of the cumulative
amount re-starts from 0 for period 5.
The CFS has to cover the eligible costs for the periods 3 and 4 (EUR 500,000 + EUR 350,000 = EUR 850,000)
(3) EC contribution for period 5 = EUR 350,000 < EUR 375.000 therefore no need for CFS for the last reporting
period
85
Project Stage – Project Reporting
Exchange Rates and Reporting
FP7 Model Grant Agreement Annex II:
Costs shall be reported in EUR. Beneficiaries with accounts in
currencies other than EUR shall report in EUR on the basis of the
exchange rate that would have applied either:
- on the date that the actual costs were incurred or
- on the basis of the rate applicable on the first day of the
month following the end of the reporting period.
Hints and tips
•
Follow your institutional accounting practices;
•
When budgeting, set conservative exchange rate to avoid
overspend;
•
Establish mechanisms in consortium agreement to deal with
underspend (e.g. transfer funds to other project partners);
•
Inform project officer when dealing with over/underspend.
86
Project Stage - Reporting
Grant Agreement Amendments
• Modification to GA = Amendment
• Amendment Guide for FP7
• Examples:
– Adding beneficiaries
– Change co-ordinator
– Partial transfer rights and obligations
– Project title, acronym, duration of project
– Modification of reporting periods
– Change of bank details
– Add/remove special clause
– Modification of annex 1
• Model letters – all requests in writing
• ‘Entry into Force’
• Don’t need amendment for budget transfers
Project Stage – Project Closure
6) Project Closure
•
Final report within 60 days after the end of
the project
•
•
•
•
Periodic report
Final publishable summary of results, conclusions
and socio-economic impact as well as plan for use
and dissemination of foreground
Report covering wider societal implications of the
project
Final Payment
•
•
•
Co-ordinator to distribute final payment
Report to EC on the distribution of the payment to
the consortium
Submitted 30 days after the final payment
88
Project Stage – Post-Project Tasks
7) Post-Project Tasks
•
•
•
•
Distribution of final payment
Consortium agreement still active?
Commission audit
Technical audit
Remember!
• ‘The beneficiaries shall keep the originals or, in
exceptional cases, duly authenticated copies –
including electronic copies - of all documents relating to
the grant agreement for up to five years from the end
of the project. These shall be made available to the
Commission where requested during any audit under the
grant agreement.’
89
Project Stage – Post-Project Tasks
Financial Audits and Controls
•
•
•
•
•
•
Commission audit (or by appointed representatives)
Can look at finance, systems in place and accounting
and management aspects
Requires originals/duly authenticated copies (incl
electronic) of data upon request (including third party)
Commission sends provisional report to beneficiary
Respond to Commission report within one month
Final report issued by Commission within two months of
the deadline for comments
90
Project Stage – Post-Project Tasks
Technical Audits
•
•
•
•
•
•
•
By Commission or appointed S&T experts
Scientific, technological aspects and others relating to
the effective execution of the project
An assessment of fulfilment of project work plan,
relevance of work, resources used, management
procedures, beneficiaries contributions, impact, ethics
audit
Commission send provisional report to beneficiary
Respond to review within one month
Commission to inform co-ordinator of decision
Guidance notes and template on “Project Technical
Reviews in FP7 Involving Independent Reviewer(s)”
91
Further information and links
Sources of Information
FP7 – Further information
UKRO Website: http://www.ukro.ac.uk
UKRO FP7 Grant Agreements and Finances page:
http://www.ukro.ac.uk/subscriber_services/fp7/legal_financial
Includes Key Reference Documents:
• Rules of Participation
• Grant Agreements
• Consortium Agreements
UKRO information services: http://ims.ukro.ac.uk
Use advanced search function on the UKRO Information Services!
93
FP7 – Further information
Important links to the Participant Portal
Participant Portal:
http://ec.europa.eu/research/participants/portal
Login to access the Participant Portal services:
http://ec.europa.eu/research/participants/portal/appmana
ger/participants/portal/login/
Creation of an ECAS account to log into the Participant
Portal:
https://webgate.ec.europa.eu/aida/selfreg
Technical helpdesk of the Participant Portal:
DIGIT-EFP7-SUPPORT@ec.europa.eu
94
Further Information
FP7 – Further information
• EPSS Helpdesk
• E-mail: support@epss-fp7.org
• Tel: +32 2 233 3760
• IPR helpdesk Website
• http://www.iprhelpdesk.eu/home
• European Commission FP7 Ethics Website
• http://cordis.europa.eu/fp7/ethics_en
95