Preparing a consortium agreement
for FP7 – the basics
Jenny Melia, National Delegate NMP Programme
Overview




What is covered by a ‘typical’ consortium agreement
Model FP7 agreements available
Checklist for developing a consortium agreement
Common mistakes & pitfalls (FP6)
What is a consortium agreement (CA)
 The CA is an agreement made between participants to govern a
number of issues that will or may arise during the project. It applies to
all the contractors participating in the project covered by the contract.
 The Community is not a party to any CA and does not establish the
terms and conditions of the CA but it issues guidelines for development
 In principle, the CA should in principle be negotiated and signed before
starting the project.
 A consortium agreement is required for all projects financed under FP7
except those exempted from this obligation by the call for proposals to
which they have applied.
What does the consortium agreement govern?
1. General Information on project
2. Technical Provisions and the internal organisation of the consortium
3. Financial and Legal Provisions
4. Management of Intellectual Property Rights
5. The settlement of internal disputes.
Defined by the Rules for Participation and the EC Grant Agreement
for the implementation of FP7. It must comply with these documents.
Outline of typical CA (based on FP6)
 General information and conditions, Definitions
 Technical provisions
 Technical contribution of each party (as set out in Annex 1)
 Technical resources made available
 Project Schedule
 Expected contribution, maximum effort expected
 Modification procedure
 Provisions for dealing with non-performing contractor (s)
Outline of typical CA (based on FP6)
 Commercial provisions
 Confidentiality
 Ownership of results / joint ownership of results / difficult cases
(background knowledge that is very closely linked to the result, making it
difficult to distinguish the background from the result)
 Legal protection of results (patent rights)
 Commercial exploitation of results and any necessary access rights
 Commercial obligations
 Relevant patents, know-how, and information
 Sub-licensing
 Specific background to include for/exclude from use in the project?
Outline of typical CA (based on FP6)
 Organisational provisions
 Committees – establishment, composition, procedures, role and nature:
Steering, management, technical, IPR, financial etc;
 Co-ordination of committees
 Amendment / revision of the agreement
 Legal provisions





Legal form of the co-operation
Duration of the agreement versus duration of the EC contract
Penalties for non-compliance with obligations under the agreement
Applicable law and the settlement of disputes
Secondment of personnel
Outline of typical CA (based on FP6)
 Financial provisions








Financing plan
Modification procedure
Mutual payments, common costs
Distribution of management costs
Auditing of costs
Audit certificates
Provisions for dealing with non-performing contractor(s)
Third party resources - identifying parties and resources
General Introduction





Who are the partners, what’s the context and purpose of the CA?
Project title, acronym, contract no. (if available)
Contract definition and additional definitions
Terms of agreement; from date to date, retrospective?
Subject:: Annex 1 (Technical Annex) or key points
(Definitions: defines the important terms used throughout the CA (for the
sake of clarity, it is advisable that those terms already defined in the Rules
for Participation or the EC Grant Agreement are not repeated in the CA but
that a reference is made to the terms used in those documents)
The internal organisation of the consortium
 Management and operation of the project




Functions of coordinator
Roles and responsibilities of management and steering group and /or board
Responsibilities of each partner
Meetings, Technical & Financial reports
Communication, Information Exchange, Supervision
 Internal disputes amongst the consortium
 What to do it a partner doesn’t perform, wants to leave early, goes bankrupt,
replace partners, add new partners, partner wishes to block a publication?
Technical Provisions
 Tasks to be undertaken by each partner and relationship between tasks
 Technical resources to be made available
 Project schedule and dealing with changes such as altering or removing
tasks
 Desired technical results
 Role of Subcontractors
All of the above are captured in Annex 1
Financial Provisions








Overall project total
Total cost per partner; own + EC contribution
How will EC’s contribution be distributed?
Dealing with common expenses
3rd party resources (Banks, VCs)
Annual financial plan
Define costs to be claimed under management (GA)
Financial modifications
Management of Intellectual Property Rights
 How will the Foreground knowledge be managed, disseminated, used?
 Ownership, Joint ownership
 Who is responsible for dissemination, notice period, vetting procedures
etc?
 Transferring to other parties
 Protection & Use (security)
 Access Rights (can be more favourable than GA)
 Define conditions for further use, time limits
 Background Knowledge (can be more favourable than GA)
 What will be included, excluded?
 Conditions
General Provisions







When does the CA start and end?
How to deal with amendments?
Breach of obligations and penalties, liability for damage caused
Communication and applicable law
Confidentiality procedures
Which provisions outlive the CA?
How often will the CA be updated?
Model agreements available
DESCA FP7
IMG
EUCAR
Sector specific
Open access
foreground
FP6 CAs
EICTA: European ICT Industry Association
EUCAR: Automotive Industry IMG: Aerospace Industry
DESCA: DEsign of a Simplified Consortium Agreement
 Produce one consistent modular agreement for FP7 which balances the
interests of all key player categories, in the spirit of “Responsible
Partnering”
 Based on FP6 NoE CA
 www.desca-fp7.eu
 Number of FP6 coordinators e.g. CNRS, Fraunhofer, VTT
 Available without charge
 Adapt the original DESCA texts to meet your specific needs
 Continually updated, Version 1 now available online
 Simple language
 Number of modules and examples, Core text and explanations
 Caters for large and small projects, RO’s and Enterprise
Draft Checklist for a consortium agreement





Non-binding guidance for FP7 projects
Prepared by the Commission
Highlights main issues – 11 parts
Version 19/04/07 currently available
ftp://ftp.cordis.europa.eu/pub/fp7/docs/checklist_en.pdf
Common mistakes
 Where something basic in the CA is not in line with the EC contract e.g.
conflict regarding publications, project trying to speed things up
 Unclear definitions e.g. ‘exceptional circumstances’
 Background knowledge
 Inform Commission as well as the other contractors if you decide not to
protect knowledge
 Duration of access rights
 Use of results: refers to economic exploitation of the results and to their
utilisation in further research activities
 http://www.ipr-helpdesk.org
In Summary





Get started straight away
Use model agreements available and FP7 checklist
Draw up a model CA for large and small project
Double check with your legal dept.
Refine