Antworten des Research Enquiry Service
Hier finden Sie eine thematisch sortierte Sammlung von Fragen und Antworten des Research Enquiry Service (RES) der Europäischen Kommission zu Horizont Europa
Hier finden Sie eine thematisch sortierte Sammlung von Fragen und Antworten des Research Enquiry Service (RES) der Europäischen Kommission zu Horizont Europa
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Hier finden Sie die von der NKS Recht und Finanzen an den Research Enquiry Service (RES) der Europäischen Kommission zu Horizont Europa gesendeten Fragen zu unklaren Sachverhalten und Auslegungsfragen. Die Fragen sind nach Themen gegliedert. Tipp: In aufgeklappten Boxen können Sie über die Tastenkombination "Strg + F" nach Stichworten suchen.
Question: When do you have to fill out the "Control Questionnaire" according to article 22,24 of the rules of participation? During proposal stage / grant preparation stage for all calls or only specific calls? Is the proposal / consortium than ineligible or only the partner concerned. Where is it possible to find more information on that topic? Is it possible to download the questionnaire somewhere?
Answer: The participation to some topics of Horizon Europe is restricted in application of article 22.5 of the Horizon Europe regulation. This article specifies the conditions under which legal entities that would normally be eligible are excluded from participating to the programme, in order to protect the Union strategic assets, interests, autonomy or security.
For the topics concerned, the use of article 22.5 is mentioned in the work programme, in the eligibility condition section of the specific topic conditions. It specifies if only the first paragraph of the article 22.5 is applying or if the two paragraphs are applying.
The first paragraph of this article refers to the countries in which entities have to be established to be allowed to participate. For the topics concerned, the work programme will identify the so-called "eligible countries". Entities established in these countries are eligible to participate.
The second paragraph of the article 22.5 specifies that for duly justified and exceptional reasons, the participation of legal entities established in eligible countries that are directly or indirectly controlled by non-eligible third countries or by non-eligible third country entities may also be excluded or made subject to conditions, for example the requirement to submit a guarantee. The "Declaration of ownership and control" questionnaire is the document used to assess if an organisation is controlled or not. This questionnaire is published in the Funding & Tenders Portal.
When the second paragraph of article 22.5 applies, applicants must fill in the "Declaration of ownership and control" questionnaire as part of their proposal application. The questionnaire will be available for download in the Portal Submission System. Each participant must fill in a declaration (beneficiaries, affiliated entities, subcontractors and associated partners). However, entities that are validated as public bodies by the Commission Central Validation Service do not have to fill in the form. All declarations must be assembled by the proposal’s coordinator and uploaded in a single file as an annex to the proposal in the Portal Submission system. Specific guidance is under preparation to help applicants in such restricted calls to become aware of the existing requirements, in particular, the ownership control assessment procedure and the guarantees that may be required if control by an ineligible country is confirmed.
Question: What is the reason for not allowing third countries (e.g. Switzerland) being coordinator anymore like in Horizon 2020 and what is the legal basis for this?
Answer: Under the Horizon Europe Model Grant Agreement, which is aligned to the corporate Model Grant Agreement adopted at Commission level, only entities eligible for funding may become beneficiaries and only beneficiaries can become coordinators. Under Horizon Europe Model Grant Agreement (article 7) beneficiaries are signatories of grant agreements, they must be eligible for funding under the Horizon Europe basic act for the entire duration of the action and can participate with full rights and obligations, including funding.
We recall that entities from a non-associated third country such as Switzerland are not in principle eligible for funding under Horizon Europe and bear the cost of their participation. They can however be exceptionally eligible for Horizon Europe funding under the conditions of article 23 (2) of Horizon Europe Regulation if:
Question: We received a question on the participation of an affiliated entity we are not sure about if it is possible. One of the potential partners has an affiliated entity that has itself also an affiliated entity which they want to include in the project (only the applicant and the affiliated entity (not directly linked to the beneficiary but to its own affiliated entity). Is it possible to include the second entity without the first directly linked entity or do both have to be included into the consortium?
Answer: An affiliated entity must have a legal link to a beneficiary. A legal link to a beneficiary means a legal or capital link, which is neither limited to the action nor established for the sole purpose of its implementation. This covers permanent legal structures, contractual cooperation not limited to the action (e.g. a collaboration agreement for research in a particular field) or a capital link. You may note that the capital link covers not only direct control but also indirect control of the beneficiary, being under the same indirect control as the beneficiary or indirectly controlling the beneficiary.
In your example, if the concerned entity has no such link to the beneficiary, it cannot be an affiliated entity. Yet, as said above, the Research Enquiry Service is not in a position to assess further the specifics of a case. Besides this legal or capital link issue, if the entity which is affiliated to the beneficiary is not performing any action tasks, it cannot be an "affiliated entity" in the sense of article 9.3 of the Horizon Europe Model Grant Agreement. Moreover, there is no possibility for an affiliated entity to have its own affiliated entity as article 9.3 defines that an affiliated entity must have a link to a beneficiary.
Another alternative might be that the entity (i.e. the affiliated entity of an affiliated entity in your example) performing work on the action, participates as a beneficiary, provided that this is possible under the applicable call conditions.
Question: We have a question on the consortium agreements in Horizon Europe. According to article 7 Horizon Europe Grant Agreement and number 1 of the data sheet of the Grant Agreement, the consortium has to conclude a consortium in most cases. Now we are wondering who is obliged to sign. Is it only the beneficiaries according to article 7 Grant Agreement (partner from Member States and Associated Countries) or also associated partner and article 10 participants?
Answer: According to article 7 of the Horizon Europe Model Grant Agreement, a written consortium agreement between the beneficiaries setting out their internal arrangements regarding their operation and coordination may be required by the granting authority. It can also be concluded on the initiative of the consortium. Such written agreement must be at least signed by the beneficiaries but other participants that are involved in the implementation of the action may be part of this consortium agreement, like for instance associated partners, affiliated entities or participants with special status. The beneficiaries are not prevented from inviting other participants to adhere and sign their consortium agreement, this is up to them to decide on this aspect.
Question: We have a question on the legal relation between the consortium / beneficiaries and the associated partners (articles 9.1 and 10.1). As we understand from articles 7 and 9.1 of the Horizon Europe Grant Agreement, the associated partners do not sign the Grant Agreement, but a beneficiary is legally responsible for their actions. Do the coordinators have to conclude an additional so-called coordination agreement with the associated partners or article 10.1 partners to legally involve them into the action? Is there a model the coordinators can use? Is this the collaboration agreement which is mentioned at the end of number 1 of the data sheet of the Grant Agreement?
Answer: According to the Horizon Europe Model Grant Agreement, there is no obligation for the beneficiaries to sign a written agreement with their associated partners. What is mandatory is to list them in article 9.1 of the Grant Agreement and mention their tasks in Annex 1.
In any case, it is the beneficiaries' responsibility to ensure that obligations mentioned in article 9.1 Horizon Europe Grant Agreement are accepted by the associated partners. As a best practice, when beneficiaries want to formalise their relations with associated partners, the former may rely on any kind of contractual arrangements with the latter. Beneficiaries can also rely on the consortium agreement and invite associated partners to be part of it.
Concerning the provision of a consortium agreement template, no such document is available. However, the article 7 of the Horizon Europe Grant Agreement can provide you some indications about its content. Indeed, when the granting authority requires a written agreement to be signed between the beneficiaries, it must cover for instance:
In your query, you make reference to a coordination agreement. The coordination agreements were used in the framework of Horizon 2020 and were related to joint calls. Under Horizon Europe, coordination agreements gave way to collaboration agreements, which aim at setting out arrangements when two actions are linked. As provided in article 7 of the Horizon Europe Grant Agreement, to ensure coordination and proper implementation of the actions, the beneficiaries must have arrangements with the participants of the other action. When required by the granting authority, these arrangements must be set out in a written collaboration agreement aimed at linking the two parallel actions and ensure a smooth and successful implementation of the project. As a general rule, the collaboration agreement should complement the two grant agreements and must not contain any provision contrary to them.
Question: In H2020, the MGA Article 9 included some special references and provisions for “Beneficiaries not requesting EU funding”, e.g, no obligation to submit financial statements, audit requirements etc. In HE such provisions are no longer included in the MGA. However, we assume it is still possible for a HE beneficiary to request 0.0 EURO in the Requested EU Contribution column in Annex 2. In praxis this means that it is still possible in HE to participate as “Beneficiary not requesting EU funding”. Is this correctly understood? If so, will such a beneficiary in HE have to submit a financial statement requesting 0.0 EURO? This seems like an unnecessary administrative procedure. However, if it is a contractual obligation, the beneficiary should know before they sign the Grant Agreement.
Answer: As you have noticed, the Horizon Europe Model Grant Agreement does not include a provision equivalent to Article 9 of the H2020 Model Grant Agreement. Generally speaking, participants that participate in the action without funding should by default chose the status of ‘associated partners’ that cannot declare eligible cost and therefore are exempted from financial obligations of the grants. Yet, in HE it is still possible to participate as “Beneficiary requesting zero funding”.
Where participants without funding exceptionally participate as beneficiaries, at reporting stage, beneficiaries that are eligible for funding but requesting zero funding must submit financial reports. The beneficiary would normally decide whether to report in the financial statement no costs, i.e. to indicate “0” in the appropriate columns, or to report, in full or in part, its actual eligible costs, i.e. costs that comply with the eligibility conditions. For eligible costs covered by own resources for which 0 contribution is requested, the conditions for costs eligibility would need to be fulfilled but these costs and conditions will not be checked during an audit.
According to Article 25.1.3 of the Horizon Europe Model Grant Agreement audits are not restricted to financial implementation of the action, they also concern the proper implementation of the action and compliance with the obligations under the Agreement. As a consequence, beneficiaries requesting zero funding are not exempt from audits. However, in the absence of funding, audits would focus on the records and supporting documentation that refer to the technical implementation of the action or compliance with other obligations under the Grant Agreement with no risk of financial errors involved.
Question: Does it mean that all third countries not eligible for EU-funding can ONLY participate as associated partner or is it also possible to include them as beneficiaries without EU-funding (as it was possible in H2020)?
Answer: Under HE the ‘beneficiary’ status refers to entities eligible for participation and funding. The legal status ‘beneficiaries not (eligible) to receiving EU funding’ is no longer foreseen in the Model Grant Agreement under Horizon Europe. Participants from non-associated third countries which are (not eligible for funding may participate ‘associated partners’.
Question: In case organisation’s from third countries not eligible for funding can also participate as beneficiaries without EU-funding would it be possible for them to be coordinator (as in H2020)?
Answer: They cannot be coordinators. In order to be coordinator of a project, a legal entity must be a beneficiary in accordance with Article 7 of the Horizon Europe Model grant agreement. Only entities eligible for funding can sign the grant agreement and become a beneficiary.
Question: For projects that are currently replacing an UK coordinator because they only participate as associated partner would it be possible to change their status to beneficiary / coordinator during the course of the project via an amendment once the association of the UK is in place (even if they will be funded by the UK for this project)?
Answer: If requested by the consortium, an amendment of the grant agreement would be necessary to change the status of the UK entity from an associated partner to a beneficiary when the association is in place, is applicable.
Question: Error message appears in the portal referring to IERO Horizon Europe
Answer: The IERO status applies only to a very limited number of organisations (example: CERN). Due to a change of legal definitions in the transition from H2020 to Horizon Europe, this status became ‘undefined’ for all organisations. This lead to a blocking in the grant agreement preparation.
Applicable solution:
A patch was applied on 20 January, setting the IERO status to ‘No’ for the vast majority of organisations, thus unblocking the grant agreement preparation. For cases that cannot be corrected automatically, the Legal Entity Appointed Representative (LEAR) of the organisation (or one of the Account Administrators) has to modify the ‘International Organisation’ and ‘IERO’ attributes in the participant management module under the Funding & Tenders Portal.:
Go to My Organisation -> legal information-> edit organisation, and set the fields for 'International Organisation' and 'International European Research Organisation' to the value ('yes' or 'no') applicable to your organisation.
We would be grateful if you could distribute this information to your concerned constituencies. We apologize for the inconvenience caused.
Question: for the measure taken against Russia due to the actual political situation we found Council Regulation (EU) 2022/576 of 8 April 2022 amending Regulation (EU) No 833/2014. Which legal basis is it for Belarus? we couldn't find a link to Belarus in the regulation. Is there another regulation?
Answer: for Belarus please see the following restrictive measures:
Question: in addition to the previous request (no Finance of partner from Belarus for the whole period of the project) under the reference number 319362, the action number of the ncp project concerned is the following:
Answer: According to our records this project ended on 31-12-2021 and the Belarusian State University was part of the consortium. If I interpret well the comments on the excel table, the final payment for this project has been done deducting the costs incurred by the Belarusian entity. The reasons behind it is that the payment to the entity is now subject to further assessment following introduction of EU restrictive measures. I do not see any further update on this project.
For the general context with Belorussia, please observe the following:
Since October 2020, the EU has progressively expanded its restrictive measures in light of the situation in Belarus.
On 15 November 2021, the Council amended the designation criteria to allow for the application of targeted restrictive measures against those organising or contributing to activities by the Lukashenko regime that facilitate the illegal crossing of the external EU borders.
Most recently, the legal framework for restrictive measures in view of the internal situation in Belarus was prolonged for one year, until 28 February 2023.
As concerns international developments, since February 2022, the EU has condemned in the strongest possible terms Belarus' involvement in Russia's unprovoked and unjustified military invasion of Ukraine, and consequently adopted a variety of restrictive measures.
On 3 June 2022 the Council decided to impose restrictive measures on an additional 12 individuals and 8 entities for their role in the ongoing internal repression and human rights abuses in Belarus. These measures are in addition to those adopted in the context of Belarus’ involvement in Russia’s war against Ukraine and constitute sixth round of sanctions against the Lukashenko regime linked to the domestic situation in Belarus
The decision targets prominent individuals responsible for continued human rights violation or seriously undermining democracy and the rule of law in Belarus. The listed individuals are responsible for the repression of civil society and the democratic opposition, or benefit from and support the Lukashenko regime. The new listings include high ranking state officials, businessmen and their family, members of the judicial branch, and prominent propagandists, responsible for spreading disinformation and calling for violence.
Today's round of sanctions, the sixth since October 2020, also targets companies such as Belaruskali, Belarus’s main potash producer, and its export arm, Belarusian Potash Co., the state television and radio broadcasting company Belteleradio, as well as other companies manufacturing tobacco and public transport vehicles.
Altogether, EU restrictive measures on Belarus now apply to a total of 195 individuals and 35 entities. Those designated are subject to an asset freeze and EU citizens and companies are forbidden from making funds available to them. Natural persons are additionally subject to a travel ban, which impedes them from entering or transiting through EU territories.
The relevant legal acts, including the names of the persons concerned, have been published in the Official Journal.
The EU stands ready to support a peaceful, democratic transition in Belarus. It is also ready to adopt further restrictive measures, if the situation in the country does not improve.
Question: Article 22.4 of the Regulation establishing Horizon Europe states that entities from third countries can not participate in Coordination and Support Actions unless this is forseen in the relevant work programme. The FAQ 18457 says that “To be eligible to participate as beneficiaries (or affiliated entities) in Horizon Europe coordination and support actions (CSAs), legal entities must be established in a Member State or associated country, unless exceptionally the relevant work programme specifies (e.g. call conditions) that entities established in some or all non-associated third countries may also participate. [ ….] Legal entities not fulfilling both of the above conditions (regarding eligibility to participate AND to receive funding),i.e. legal entities established in non-associated third countries for which the work programme does not specify that they may participate or legal entities eligible to participate but not eligible for funding, may participate as associated partners (unless the work programme or the grant agreement lays down additional conditions which must be met to be able to participate in the action).
Some of our clients are drawing the conclusion that all third country entity can participate now in CSA as associated partners. Would you please confirm that it is still necessary that the relevant work programme indicates directly that entities from third countries can be included in the consortium as beneficiary or associated partner? And would you please confirm that third country entities cannot participate in every CSA?
Answer: We note that your query concerns participation by legal entities from non-associated third countries in Coordination and Support Actions (CSAs).
As indicated in the General Annexes HE WP 23-24) (page 10):
Beneficiaries and affiliated entities: Legal entities established in non-associated third countries cannot participate as beneficiaries (or affiliated entities) unless the specific call conditions provide otherwise.
In other words, in the absence of specific conditions applicable to a particular CSA call, the default position is that legal entities from non-associated third countries are eligible to participate as associated partners, whereas participation as beneficiaries (or affiliated entities) is excluded.
It is noted that, even where eligibility to participate as a beneficiary (or affiliated entity) is opened up to legal entities from one or more non-associated countries at call level, such participation is only possible to the extent that the legal entity is eligible for funding (e.g., because it is established in a low to middle income country generally eligible for funding, or because the call conditions otherwise provide for eligibility for funding applicable to the country of establishment of the entity).
Question: We would like to include the Saami Council in an application. This is an NGO that represents the indigenous Saami people in the north of Norway, Sweden, Finland, and the Russian federation. The question is; can the Saami council which is a Norwegian legal entity participate in a project when the organization has members from Russia? Can the participate if they have a firewall in place to make sure that they only involve the Norwegian, Swedish and Finnish part of the organisation and not the Russian?
Answer: The General Annexes of the 2023-2024 HE WP at page 13 provide that legal entities established in Russia, even if not subjected to EU restrictive measures, are not e ligible to participate in any capacity to the HE programme.
For entities established outside Russia, EU funding will not be allocated to them if a Russian public entity controls them or owns more than 50 percent of their shares.
In practical terms, this means that the Saami Council, i.e. a Norwegian NGO, which includes nine members from Norway, Finland, Sweden and Russia, can participate in activities and receive funding under HE, provided that its two Russian members do not control it nor own more than 50 percent of that entity. Accordingly we would advise not to involve the Russian members of the Saami Council in the activities of the project as this could pose questions on appropriateness of reimbursement of their costs. We hope you find this information useful.
Question: Can you confirm that the Affiliated Entity does not need an LSIGN?
Answer: Affiliated Entities do indeed require a LEAR and an LSIGN in order to participate.
Question: Given that the company has internal rules for trustworthy digital signatures in place, is it possible to sign the declaration of honour digitally? Are there any minimum requirements for digital signatures which have to be respected?
Answer: We confirm that the Declaration of Honour may be signed electronically.
Please ask the participant to use the following link: https://webgate.ec.europa.eu/esig/validate
Question: As the Associated Partners (APs) do not sign the GA, the rules and obligations relating from the GA do not apply on APs automatically and therefore a lot of discussions on how to handle specific situations in the CA arise. One important situation is IP Some beneficiaries fear to be in contradiction to the GA, APs ask for all rights like beneficiaries without obligations deriving from the GA (cherry picking).
According to Annex 5 "If third parties (including employees and other personnel) may claim rights to the results, the beneficiary concerned must ensure that those rights can be exercised in a manner compatible with its obligations under the Agreement." but the beneficiary also has the obligation to protect Results and obey the additional obligations for exploitation of Results and its transfer or granting licences and its limitations, the question of ownership control and art.28,39.6 and 22.5. and the following pages.
Answer: The HE MGA rules on IPR deal with intellectual property rights (IPR), including ownership and access rights, for the beneficiaries strictly speaking. In that context, the HE MGA stipulate some rules applying to the beneficiaries when involving third parties, notably that if those third parties (including associated partners) may claim rights to the results, ‘the beneficiary concerned must ensure that those rights can be exercised in a manner compatible with its obligations under the Agreement’ (see Annex 5 rules on ‘ownership of the ‘results’).
But, as Associated Partners are third parties of the HE Grant agreement, the latter does not regulate the access rights/licences that can be granted to associated partners on background of and/or results generated by the beneficiaries. Therefore, it is up to the beneficiaries to agree, via bilateral agreement or via the consortium agreement, on access rights (if any) to be granted to associated partners on background of and/or results generated by beneficiaries (and/or generated by other participants, such as other associated partners), notably to ensure a smooth implementation of the action.
In that respect, the consortium has a quite important margin of manoeuvre in agreeing (or not) on these additional access rights to the benefits of associated partners. A general limit would be that such access rights granted to associated partners do not prevent the beneficiaries to comply with their obligations, for example to provide certain access rights as per the HE MGA rules. This would be typically the case if, for instance, an exclusivity of access is given to the benefit of an associated partner, preventing then a beneficiary to give other access rights to other beneficiaries (for the action implementation, for instance). Any applicable rules related to licensing/use/disclosure of results would need to be respected. In certain cases, complying with the beneficiaries’ grant obligations may mean that access could be granted to certain results only with the prior written approval of the granting authority, for example in the case of classified information.
This being said, we are afraid that we are not in a position to delineate further any specific limits in the granting of such access rights from beneficiaries to the benefit of associated partners. Apart from ensuring the respect of their grant obligations, we would however expect that the consortium would take into account all relevant elements in their specific project to determine the appropriate level of access rights of any associated partners, including for example the scope/nature of their involvement and objectives of the project.
Eventually, you refer in your query to situation where apparently Associated Partner ‘ask for all rights like beneficiaries without obligations deriving from the GA (cherry picking)’. In that context, as further explained in the annotated grant agreement (see also page 264 of the Annotated Model Grant Agreement, version V1.0 of 1 April 2023) under specific cases, we would like to remind that for results generated by associated partners the situation is similar to that of beneficiaries not having received EU funding.
This can be achieved through separate bilateral agreement or via the consortium agreement. Of course, again where appropriate in view of their project, the beneficiaries could agree on additional (access) obligations on their associated partners relating to their results or for example regarding background held by them. This could be seen as appropriate by beneficiaries, if an associated partner would insist on broad additional access rights.
Finally, it is up to the beneficiaries to decide if they want (or not) to involve a particular associated partner in their project.
Question: Is it possible that an associated partner is the sole work package leader?
Answer: After verification with the relevant service, please note that it is perfectly possible that an associated partner is the sole work package leader.
Question: Can the travel costs of associated partner's staff be covered by the beneficiary's budget?
Answer: Associated partners are entities which implement action tasks but without receiving EU funding and without becoming party to the Grant Agreement (i.e. they do not sign the Grant Agreement).
According to Article 9.1 of the Horizon Europe Model Grant Agreement they may not charge costs or contributions to the action and the costs for their tasks are not eligible.
Therefore, costs for the travels undertaken by personnel of associated partners in the context of the performance of their actions tasks are not eligible under Horizon Europe, regardless whether the costs are incurred by the beneficiaries or by the associated partners themselves.
Otherwise, it could be seen as a way of circumventing the rules.
Question: How to proceed, when a LEAR left a registered entity (validated pic) and no account administrator is named in the portal. Registration of a new LEAR for this entity seems to be impossible as the self registrant is not available neither. How to proceed in this case for registering a new LEAR? Does the entity need a new pic and validation and then the LEAR registration?
Answer: Please advise the entity in question to contact us via the Research Enquiry Service web form: https://ec.europa.eu/info/research-and-innovation/contact/research-enquiry-service_en with their PIC number.
Question: We have been contacted by a German architect who wants to participate in a Horizon Project as a beneficiary. In Germany architects work as "Einzelunternehmer". Actually, it is the most widespread form of enterprises in Germany. "Einzelunternehmer" is a natural person.
My client wants to register in the participant register. But the legal form "Einzelunternehmer" is not part of the drop down menue - neither when he chooses natural person nor when he chooses legal entity.
Answer: This legal form will be validated as a natural person. Natural persons do not have specific legal forms available in the participant register therefore the legal form will be set up as “unknown”.
Question: “Entity A” was sold to “Entity B” and the case is qualified as a universal takeover. Coordinator and PO are informed. After reading the recommendations in the Online Manual which are the first steps to be taken to prevent double registrations?
Answer: A universal takeover is performed when an entity is legally dissolved and all its rights and obligations are transferred to a new entity.
Both conditions must be fulfilled. In order to assess whether this is the case for the entities involved, could you please provide us with a copy of the official document(s) proving the transfer of rights, such as a registration extract or a notary act proving that the entity ceased to exist and that all the rights and obligations have been transferred to the new entity. The document(s) should also indicate the effective date of the transfer.
Please upload these document in the participant register of one of the 2 PIC’s.
Once the Central Validation Service has received these documents, you’ll be informed with further instructions.
In case you have further questions, please contact the Central Validation Service directly via the Messages section of your organisation’s PIC account in the Participant register on the EU Funding and Tender portal.
Question: According to the AGA, page 2, it is possible for an organisation to be included in a proposal as an associated partner + at the same time as a third party providing in-kind contribution (a combination of roles within the action). If necessary for the implementation of the action, associated partners carrying out their own tasks may also support beneficiaries and associated entities in carrying out their tasks by providing in-kind contributions.
Does this also apply to non-associated third country organisations in Horizon Europe calls for proposals? What about a US-American institution - will it be possible for them to join a consortium for an HE proposal as an Associated Partner and at the same time provide IKC against payment? Will the invoiced costs for IKC from the US-American Associated Partner to one Beneficiary be eligible in a Horizon Europe project? What requirements need to be fulfilled in this case? Are these costs eligible even if a US-American partner is not listed as exceptionally eligible in the call and topic-text?
Answer: From your question, we understand that you’re asking whether is it possible to declare the resources provided to the beneficiary against payment by an associated partner from a high-income non-associated country. We first wish to clarify that under Horizon Europe, there is not a specific cost category for in-kind contributions provided by third parties against payment. Instead, depending on their nature, a beneficiary can declare these costs under specific budget categories (e.g. A.3 Seconded persons, C.2 Equipment and C.3 Other goods, works and services). Thus references to “in-kind contributions” in the Annotated Model Grant Agreement refer in principle to “in-kind contributions for free”.
Having said that, an entity providing to a beneficiary seconded persons, equipment or other goods, works and services against payment must not necessarily be established in Member States or associated countries. The general rule is that the eligibility of costs under these budget categories does not depend on where the provider is established (inside or outside the EU). However, this cannot be used to circumvent the funding rules of the programme (i.e. be motivated by the purpose of attributing EU funding to an entity that is not eligible for funding). The set-up to participate in a given consortium of participants in a given project should be foremost justified by the implementation of the project itself. In particular, the costs must indeed correspond to resources contributed to the beneficiary, and not to work carried out directly by the other entity or under the other entities’ control/supervision.
Concerning the combination of roles, we wish to underline that in principle, each person or entity should only participate in a single role in an action. This is to avoid any potential conflicts of interest and ensure clear allocation of rights and obligations as well as certainty on cost eligibility. It is in principle possible for an associated partner in support of certain parts of the action to also compete for a beneficiary’s purchases in the same action, if in accordance with the criteria for awarding the purchase (best value for money or lowest price, no conflict of interest) an associated partner gives the best offer. This may notably be the case in exceptional and properly justified cases e.g. an associated partner is the usual supplier of a beneficiary for a generic consumable that the beneficiary needs for the action. It would be advisable to explain the justification for purchase or secondment of personnel in the Description of the Action in to avoid any situation that could be negatively perceived as a way of circumventing the rules on funding eligibility.
Please note besides that some grant agreements may include specific country restrictions (see notably, Article 6.3(e)(i) and Annex 5-Article 18 of the HE MGA with possible call conditions restricting participation or control due to security reasons), in which case, participation may be restricted.
Question: What legal consequences will the 12th EU sanctions package against Russia from December 18, 2023 includes Article 12g of EU Regulation 833/2014 (so-called “No Russia Clause”) have on the Grant Agreements and consortium agreements in Horizon Europe (HE)? Could you give us advice or notice whether the European Commission is planning to amend the former GAs and include a new clause to the new GAs?
Answer: We understand that you are enquiring about the legal consequences of Council Regulation (EU) 833/2014 on the Grant Agreements and consortium agreements in Horizon Europe, with specific regards to the so called "no re-export to Russia" clause (Article 12g), introduced in the context of the 12th EU sanctions package against Russia adopted by the Council on 18 December 2023 (Council Regulation (EU) 2023/2878 of 18 December 2023). You would also like to know if the Commission is planning to amend the HE Model Grant Agreement to include such a clause.
Article 12g of the Council Regulation (EU) 833/2014 obliges EU exporters to insert a "no re-export to Russia" clause in their export/sale/supply/transfer or similar contracts of particularly sensitive goods and technology. Specifically, this sanction includes prohibitions on the export, sale, transfer of dual-use goods and advanced technology items to target sensitive sectors in Russia’s military industrial complex and to limit its access to crucial advanced technology.
The Horizon Europe Grant Agreement is an Agreement between the Granting Authority and the beneficiary(ies) setting out the rights and obligations of each party and the terms and conditions of the grant that beneficiaries must comply with when implementing an action (i.e. a project). As provided by its Article 43.1, the HE Grant Agreement is governed by the applicable EU law.
Under Article 288 of the Treaty on the Functioning of the European Union (TFEU), regulations have general application, are binding in their entirety and are directly applicable in all EU Member States. Therefore, the restrictive measures provided by the Council Regulation (EU) 833/2014, including the "no re-export to Russia" clause, are already part of the EU legal framework applicable to the HE Grant Agreement. There is no need to include a specific related provision in the HE Model Grant Agreement – beneficiaries have to comply with the provisions included in the Regulation, regardless of whether this is specified in the Grant Agreement. Besides, the scope of the Grant Agreement is more limited than the one of the Regulation.
With regards to consortium agreements, they are private agreements between members of the consortium, to set out their internal arrangements for implementing the project and the administration of the EU grant. Consortium agreements should complement the Grant Agreement and must not contain any provision contrary to it (or the applicable EU, international or national law). Therefore, the beneficiaries have to ensure that they comply with the restrictive measures provided by Council Regulation (EU) 833/2014.
Question: We have a question regarding the evaluation of operational capacity. Annex C of the Horizon Europe Work programme states that operational capacity is an award criterion:
"For this assessment, applicants will be required to provide the following information in the application form (Part B):
Where exactly in Part B has this information to be provided? Some of the points to be assessed are included now in Part A, but not all of them. Maybe Part A and B are mixed up here? On the other hand, Part A does not cover all points, which shall be assessed. Where can I provide general profiles of the staff responsible for management and implementation? This group of persons is explicitly excluded from the Table in part A.2 Researchers involved in the Proposal.
Answer: Please note that all the information you mention may be provided in Part A of the general annexes. The structure of the annexes will soon be updated to resolve the current confusion.
Question: Could the Research Enquiry Service please confirm for Horizon Europe that state aid rules (nor deminimis) are not applicable for Horizon Europe as in Horizon 2020?
Answer: Only advantages granted directly or indirectly through State resources can constitute State aid within the meaning of article 107.1 of the Treaty. Hence, centrally-managed EU resources such as Horizon 2020 or Horizon Europe do not constitute “State aid”. This principle is also explained in the Commission's notice on the notion of aid (point 60): "if such resources are awarded directly by the Union, by the European Investment Bank or by the European Investment Fund, with no discretion on the part of the national authorities, they do not constitute State resources (for example funding awarded in direct management under the Horizon 2020 framework programme, the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME) or the Trans-European Transport Network (TEN-T) funds)." That notice dates from 2016. The objective notion of State aid explained in this Commission Notice also apply to other EU-funding under direct management with no discretion on the part of the national authorities that entered into force after 2016, thus also to Horizon Europe.
This same principle is also explained in the Commission Communication on the Framework for state aid for research and development and innovation – Point 9 under this Framework provides that "Union funding centrally managed by the institutions, agencies, joint undertakings or other bodies of the Union that is not directly or indirectly under the control of Member States (the footnote clarifies that this is indeed the case of funding provided under Horizon 2020, hence also applicable to Horizon Europe) does not constitute state aid". Therefore, there is no requirement to take such Horizon Europe funding into account neither for State-aid compliance nor under the de minimis clause.
Moreover, "where such Union funding is combined with state aid, only the latter will be considered for determining whether notification thresholds and maximum aid intensities are respected or, in the context of this framework, subject to a compatibility assessment".
However, where directly-managed Union funding (e.g. from Horizon 2020 or Horizon Europe) is combined with State aid, the total amount of public funding (i.e State aid and Horizon funding) awarded in relation to the same eligible costs must however not exceed the most favourable funding rate laid down in the applicable rules of Union law (point 83 of the Framework; also article 8.2 of the General Block Exemption Regulation).
Question: The standard application form says that the researchers involved in the proposal, (see below definition of "researcher") have to be included. But in the Webinar: "How to prepare a successful proposal in Horizon Europe" (24 March 2021) (at 2:01:31) the Commission makes it clear that the main persons listed in the proposal must also be the ones carrying out the work in the project. Many institutions start hiring their personnel only after receiving a grant. I would like to know if the list has to be adapted and updated during the project and how detailed the changes have to be. If yes, when should this happen? In the continuous reporting? The periodic reports? Does it need an approval by the Commission (e.g. if a less high-ranking person will be carrying out the work)?
Answer: The list must be updated in the continuous reporting tab. In addition, it can be updated during the GAP process.
Question: We have been contacted by some consortia that have to involve a so-called Ethics Advisor into the project due to the wish of the evaluators. Unfortunately, there is no information at all available about their function, tasks, qualification, etc. Is it possible to involve a law firm as ethics advisor for data protection law or do they have to address scientist, if yes what kind of qualification do they have to have? It would be very helpful if you could explain a bit the task and qualification requirements for so-called ethic advisors in the project. And how many do you need if different ethical issues are tackled in the project? Most probably one advisor cannot cover all topics.
Answer: An Ethics Advisor should be an external and independent expert who is specialised in the ethics issues that a project faces and who will be able to advise on how to best address the ethics issues raised by the project’s activities, in accordance with ethical principles, the applicable international and national law, the provisions set out in the Grant Agreement, and the guidance provided in the How to complete your ethics self-assessment.
There is no predefined profile but an experience as a member of an ethics committee and experience in resolving research and technological ethics issues helps in coping with a wide range of ethics concerns.
For large projects with multiple ethics issues, several advisors are nominated to constitute an Ethics Board but for smaller actions, when a single advisor is requested, she or he will either directly advise on the concerned issues or indicate where advice should be sought. The Ethics Advisor must not have any hierarchical link with the Principal Investigator. For example, a Data Protection Officer (DPO) belonging to the same organisation cannot be considered be an external and independent expert to be appointed as an Ethics Advisor.
For further guidance please see: http://ec.europa.eu/research/participants/data/ref/h2020/other/hi/ethics-guide-advisors_en.pdf
Question: I have a Question regarding the financial capacity check for coordinators. In the "Rules on Legal Entity Validation, LEAR Appointment and Financial Capacity Assessment" (page 25) the possibility of being covered by a guarantor is mentioned. What is the difference to the "structural guarantee" mentioned in the General Annexes (page15)?
Has a small private coordinator the possibility to choose a guarantor as a backup for the financial capacity e.g. a bank or another member of the consortium?
Answer: We understand that your question relates to the financial capacity of coordinators participating in Horizon Europe, and you would like to know which is the difference between the ‘guarantee’ mentioned in the General annexes to HE Work Programme 2021-2022 (page 15) and in the Rules for Legal Entity Validation, LEAR Appointment and Financial Capacity Assessment (page 25), and if coordinators could be guaranteed by a bank or another member of the consortium.
Regarding your first question, please note that the two documents mentioned above refer to the same type of guarantee, which is the ‘structural guarantee’ provided by Article 27(3) of the Horizon Europe Regulation. According to this provision, if the financial capacity of applicants – including coordinators is “structurally guaranteed” by any other legal entity (i.e. the “guarantor”), the financial capacity of that other legal entity shall be verified, and then, if there are no grounds to doubt about the financial capacity of the guarantor, that guarantee can be accepted.
However, be aware that this ‘structural guarantee’ has to be already established either by law or in the internal statute of the applicant to cover all its obligations (i.e. the guarantor has assumed full joint liability for all debts), and it cannot be limited to the HE Programme or participations in EU grants.
Therefore, to answer your second question, a guarantee from a bank or financial institution or from another member of the consortium can only be accepted if the guarantee can be considered a structural guarantee as mentioned above.
Question: We have a question on the legal relation between the consortium/beneficiaries and the associated partners (Article 9.1 and 10.1).
As we understand from Article 7 and 9.1 GA the associated partners do not sign the GA, but a beneficiary is legally responsible for their actions. Do the coordinators have to conclude an additional so-called coordination agreement with the associated partners or Article 10.1 partners to legally involve them into the action? Is there a model the coordinators can use? Is this the collaboration agreement which is mentioned at the end of number 1 of the data sheet of the GA? If you could clarify the situation it would be very helpful. Thanks for your assistance,
Answer: We understand that to the extent that the beneficiaries are the sole signatories of the Grant Agreement and remain responsible for the action tasks performed by associated partners, you would like to know if the relations between the beneficiaries and their associated partners must be formalised in an agreement and of which kind.
According to the Horizon Europe Model Grant Agreement (HE MGA), there is no obligation for the beneficiaries to sign a written agreement with their associated partners. What is mandatory is to list them in Article 9.1 of the Grant Agreement and mention their tasks in Annex 1.
In any case, it is the beneficiaries’ responsibility to ensure that obligations mentioned in Article 9.1 HE MGA are accepted by the associated partners. As a best practice, when beneficiaries want to formalise their relations with associated partners, the former may rely on any kind of contractual arrangements with the latter. Beneficiaries can also rely on the consortium agreement and invite associated partners to be part of it.
Concerning the provision of a consortium agreement template, no such document is available. However, the Article 7 of the Horizon Europe MGA can provide you some indications about its content. Indeed, when the granting authority requires a written agreement to be signed between the beneficiaries, it must cover for instance:
In your query, you make reference to a coordination agreement. The coordination agreements were used in the framework of Horizon 2020 and was related to joint calls. Under Horizon Europe, coordination agreements gave way to collaboration agreements, which aim at setting out arrangements when two actions are linked. As provided in Article 7 of the HE MGA, to ensure coordination and proper implementation of the actions, the beneficiaries must have arrangements with the participants of the other action. When required by the granting authority, these arrangements must be set out in a written collaboration agreement aimed at linking the two parallel actions and ensure a smooth and successful implementation of the project. As a general rule, the collaboration agreement should complement the two grant agreements and must not contain any provision contrary to them.
Question: We have a question on the consortium agreements in Horizon Europe. According to Article 7 GA and Nr. 1 of the data Sheet of the GA the consortium has to conclude a consortium in most cases. Now we are wondering who is obliged to sign. Is it only the beneficiaries according to Article 7 GA (partner from MST and Associated countries) or also associated partner and art 10 participants?
Answer: According to Article 7 of the Horizon Europe Model Grant Agreement a written consortium agreement between the beneficiaries setting out their internal arrangements regarding their operation and coordination may be required by the granting authority. It can also be concluded on the initiative of the consortium. Such written agreement must be at least signed by the beneficiaries but other participants that are involved in the implementation of the action may be part of this consortium agreement, like for instance associated partners, affiliated entities or participants with special status. The beneficiaries are not prevented from inviting other participants to adhere and sign their consortium agreement, this is up to them to decide on this aspect.
Question: We received some questions regarding concerns in the proposal phase in Horizon Europe. In the Online Manual it is stated as follows: „Tasks of the Coordinator: • Mandate: Make sure that you have the mandate of all participants to submit the application (explicit agreement to participate).” Does this mean, that the coordinator needs from all partners a written confirmation on their participation although you cannot upload it in the system? Does anybody check whether the coordinator has all confirmations? What happens if the proposal will be funded bud the coordinator does not have all confirmations?
Answer: The coordinator must have the mandate of all participants to submit the application, but we will not request to submit any support document. However, note that every time the coordinator adds a participant in a proposal in the submission tool, the LEAR of the organisation will receive a notification. With this we want to avoid cases where coordinators add participants to proposal without their consent.
Question: We have difficulties in understanding Article 10.3. GA. pillar-assessed participants. In Article10.3. they are defined but in which cases do you have or need a pillar assessment? Is it a requirement in specific programs or specific groups of participants? As the AGA do not cover Article 10. GA yet, we have difficulties in answering these kinds of questions to our participants in Horizon Europe.
Answer: ‘Pillar-assessed participants’, as defined in Article 10.3 of the Horizon Europe Model Grant Agreement, means that, in line with the EU Financial regulation 2018/1046 (Article 154), an entity has been subject to an (ex-ante) audit of its rules, systems and procedures that proves that the entity can offer a similar level of protection for handling EU funds than the granting authority.
Pillar assessments are compliance assessments which the European Commission requires partner organisations to pass before implementing EU funds under indirect management. They enable the Commission to rely as much as possible on the systems, rules and procedures of those persons and entities which are positively assessed. They do not concern any mandatory requirement that should be complied with to participate in a given HE action grant.
‘Pillar-assessed’ entities are not a separate category of participants (like affiliated entities) instead, in principle any participant could have been also pillar-assessed. In most cases, pillar-assessed entities will be international organisations.
Finally, please note that the Commission services are working on updated annotations in the Model Grant Agreement and further batch(es) with the remaining annotations (including for Article 10) will be published later on this year. Therefore, the above explanations concerning ‘Pillar-assessed participants’ reflect preliminary views and do not prejudge any final position of the Commission.
Question: We understand that the signing of a consortium agreement is mandatory when it is mentioned in the data sheet and the work programme. But there is no information on the timing. Coordinators let us know, that the Agencies ask for the consortium agreement quite some time before the signing of the Grant Agreement. So that given early deadline by the agencies comes a bit surprisingly for the consortia so that it is not easy to organise the negotiations and signing by time. When do the consortia have to sign the consortium agreements latest? Where can the consortia get information on the deadline for the signing so that they can organize internally the negotiations of the consortium agreement by time?
Answer: According to Article 7 of the Horizon Europe Model Grant Agreement a written consortium agreement between the beneficiaries setting out their internal arrangements regarding their operation and coordination may be required by the granting authority (see Data Sheet, Point 1).
As best practice, in view of their importance for avoiding disputes and ensuring a smooth implementation of the grant, we strongly recommend that every consortium sets up a consortium agreement, even if not mandatory.
Regarding the deadline when the consortium agreement has to be signed, please note that the Horizon Europe Model Grant Agreement does not stipulate that this agreement has to be concluded before the grant agreement is signed. However, we recommend that the consortium agreement should in principle be negotiated and concluded before signature of the grant agreement (i.e. each beneficiary should sign the consortium agreement before signing the Accession Form to accede to the grant agreement). Otherwise, there is usually a serious risk that prolonged disagreement jeopardises the action. In view of the above, the Commission will not stop the grant preparation phase if it should become aware that the applicants have not yet concluded a consortium agreement. However, if it is mandatory to have a consortium agreement and the consortium does not have one, this may be considered a breach of grant agreement obligations.
Finally, please note specific rules may apply, for example in the exceptional case where the work programme would stipulate for the call/topic that a consortium agreement must be concluded before the signature of the grant agreement, this would be an additional eligibility condition. Consequently, if the Commission became aware of the absence of the conclusion of a consortium agreement it would not sign the grant agreement.
Question: On the homepage of the European Commission the requirements for the Gender Equality Plan differ from the wording in the Standard Proposal Template Part A on "data collection and monitoring". The homepage of the European Commission refers to "staff", the portal to "personnel and students". Are "students" in this context PhD-students?
The "data collection and monitoring" foresees an annual reporting based on "indicators". The statutory equality plan provides for a report every 3 years, which, however, breaks down the indicators annually. Would this be sufficient?
Answer: Data collection should cover all levels, staff and students. Regarding the second question on "data collection and monitoring" and the annual reporting, it is important that data are collected on an annual basis based on indicators, feeding a progress report (even if it is every 3 years in the case you describe).
Question: Is there a funding opportunity for the Gender Equality Plan or is the elaboration of the gender equality plan an eligible cost item? In some information material it is written, that funding might be available but without a reference to a programme or further information. Do you have any other information on funding possibilities by the Commission?
When does the applicant have to propose the Gender Equality Plan? Already at proposal stage, at signing the contract or during the project, because a lot of institutions do not have a plan ready yet and for working out a good Gender Equality Plan they need some time.
Answer: Having a Gender Equality Plan in place will become an eligibility criterion for higher education establishments (and research organisations and public bodies from EU Member States and associated countries) as of calls for proposals with deadlines in 2022. However, if an institution concerned by the Gender Equality Plan eligibility criterion does not yet have a Gender Equality Plan in place at proposal submission stage, for calls with deadlines in 2022, this will not be blocking the submission and evaluation of the proposal they are part of.
It is at Grant Agreement signature that the European Commission will check, and require, that all partners concerned by this eligibility criterion have indeed self-declared having a Gender Equality Plan in place that fulfils all 4-mandatory process-related requirements.
As a Gender Equality Plan will become an eligibility criterion, it cannot be an eligible cost item.
Regarding your question on funding opportunities, through the Horizon Europe Work Programme on Widening participation and Strengthening the European Research Area (WIDERA), there are calls to build competence and strengthen knowledge on gender equality throughout European Member States and associated countries, and funding in 2022 to support the implementation of inclusive gender equality plans integrating an opening to intersectionality.
You can find information on the Gender Equality Plan eligibility criterion in Horizon Europe in a dedicated section on our Gender equality in research and innovation policy webpage and also in Frequently Asked Questions (FAQ) on Gender Equality Plans available on the Funding & Tenders Portal. More detailed guidance specifically on Gender Equality Plans will be soon available.
Question: There have been many IT issues with the eligibility criterion on GEP affecting beneficiaries currently in grant agreement preparation.
Answer: There was a mistake in the IT implementation of the eligibility criterion on gender equality plans (GEPs). They become obligatory only for calls with deadline after 1.1.2022.
Due to a technical issue, the check for existence of a GEP has been activated for all projects entering grant preparation in 2022. The issue is now corrected. In case your beneficiaries (from 2021 calls) still see the error, message gender plan missing’, they should re-apply the ‘validate’ button. In the unlikely event that the issue persists, they should contact the service desk.
Question: Would it be possible in Horizon Europe to subcontract a task to an associated partner not eligible for funding? We are aware that in general subcontracts or contracts for other works and services cannot be used to circumvent the funding rules but this is the specific case:
In the call HORIZON-CL6-2021-BIODIV-01-15 the projects are encouraged to engage in international cooperation (in particular with African countries, Brazil, Latin American and Caribbean countries or the Mediterranean region). A proposal currently under development plans to cooperate with a Brazilian university that has developed freely available software necessary for the project. Beyond this software, the university has expertise that will be incorporated into the project. Since institutions from Brazil are not eligible for funding, it is planned to include the institution as an associated partner in the consortium. As part of the project, it may become necessary to customize the software. This adaptation can only be done by scientists from this Brazilian university, as the rights are held there. Is it possible to assign the adaptation of the software as a service to this Brazilian university, which will not receive any funding from the European Commission? And could the beneficiary who contracts the associated partner be able to get these costs reimbursed as subcontracting / other services (depending if it is an action task or not) in the project?
Answer: There is no substantial change between Horizon 2020 and Horizon Europe subcontracting rules. Subcontracting costs for the action, if they are calculated on the basis of the costs actually incurred, fulfil the general eligibility conditions and are awarded using the beneficiary’s usual purchasing practices — provided these ensure subcontracts with best value for money (or if appropriate the lowest price) and that there is no conflict of interests.
In the question below, it has to be seen which status the Brazilian University may have. Without knowing details, it does not look like a subcontract in this case.
Also, the terminology is to be seen, what concerns "associated partner".
As of course Subcontracting to affiliates — Is not allowed, unless you have a framework contract or the affiliate is your usual provider, and the subcontract is priced at market conditions. Otherwise, these affiliates may work in the action, but they must be identified as affiliated entities and declare their own costs.
Question: I have a follow-up question on case (see Question 4.1). Just for clarification: the status of the Brazilian partner is as an associated partner (not affiliated entity). Would it be possible to assign the adaptation of the software as a service to this Brazilian associated partner that will not receive any funding from the EU? And would the beneficiary who contracts the associated partner be able to get these costs reimbursed as subcontracting / other services (depending if it is an action task or not) in the project?
Answer: In that respect, please note that subcontracting tasks to an associated partner would not be possible. In that case, it would be for the associated partner to perform directly these tasks but without receiving EU funding.
In the same vein, purchase of services between a beneficiary and an associated partner would not be accepted, as a principle. The rationale being the same (i.e. there is the risk that the grant is issued to circumvent somehow the rules on associated partners and, on top, to charge commercial profit margins.). Purchases between a beneficiary and an associated partner could only be accepted in exceptional and properly justified cases (e.g. associated partner A is the usual supplier of beneficiary B for a generic consumable that beneficiary B needs for the action). Yet, this would not seem to be the case in the situation you describe.
This being said, please note that clarifications regarding so called "combination of roles" (where possible) are currently under internal assessment by the Commission services and might be part of the future release of the corporate Annotated Model Grant Agreement. Therefore, we cannot be further affirmative / conclusive at this stage.
Question: The Horizon Europe Annotated Grant Agreement states at page 54/55 that subcontracts between beneficiaries (and partly with affiliated entities) are forbidden. But associated partners are not beneficiaries (they don't receive funding). Does that mean that beneficiaries can subcontract certain activities to associated partners?
Answer: First of all, it should be reminded that beneficiaries must have the appropriate resources to implement the action (see article 7 of the Horizon Europe Model Grant Agreement). Therefore, an extensive use of third parties may be seen as a lack of operational capacity.
This being recalled, "associated partner" and "subcontractor" are two kind of third parties who perform actions tasks. In that respect, their status would be mutually exclusive and ideally it should be clear from the beginning how the performance of action tasks will be done and shared between a beneficiary and an associated partner.
Moreover, associated partners are not eligible for receiving funding under an EU grant agreement. Therefore, envisaging a situation where an associated partner would actually be also subcontractor (for which the beneficiary could claim reimbursement of costs, including potentially any profit-margin) could be negatively perceived as a way of circumventing the rules on funding eligibility.
Now, if during the action implementation it appears that a beneficiary cannot actually perform some of its action tasks and that an associated partner involved in the project is better placed to perform them, it might be possible to agree to such a reshuffling of action asks between them. As best practice, the project officer in charge should be informed in advance to assess whether an amendment of the grant agreement would be needed or not (e.g. for modifying its annex 1 – Description of the action).
Question: I have a question concerning the exceptional subcontracting to an affiliated entity in case it is the usual provider for the beneficiary. (MGA: Subcontracting to affiliates — Is NOT allowed, unless they have a framework contract or the affiliate is their usual provider, and the subcontract is priced at market conditions. Otherwise, these affiliates may work in the action, but they must be identified as affiliated entities under Article 8 and declare their own costs.)
If the affiliated as the usual provider is located in a third country that is not eligible for funding (e. g. the United States) would it be possible to get the subcontracting costs reimbursed? In this case the US entity needs to provide special wavers that are very expensive (400.000 EUR) and there are no other providers in Europe.
Answer: : Indeed, as an exception, subcontracting to affiliates may be allowed if they have a framework contract or the affiliate is their usual provider, and the subcontract is priced at market conditions.
Unless there are specific provisions applying to a given grant agreement in relation to the place of performance of the subcontracting (see notably, Option 1 of Article 6.2.B. and Article 6.3(e)(i) of the HE MGA, specific case of pre-commercial procurement (PCP) or procurement of innovative solutions, with possible call conditions restrict participation or control due to security reasons), the general rule is that the eligibility of costs of the subcontracts does not depend on where the subcontractor is established (inside or outside the EU). However, subcontracting may not be used to circumvent the rules on eligibility for funding, in particular the eligibility rules for funding applicable to participants, which are set out in Article 23 of the Horizon Europe Regulation.
But, in any case, the subcontracting costs must comply with the general and specific eligibility conditions set out in Article 6.1 and 6.2.B of the Horizon Europe Model Grant Agreement.
Finally, we advise that the specific subcontract envisaged is discussed with the Commission/Agency's Project Officer in charge of the project.
Question: We are receiving several questions on whether it is possible for an associated partner to subcontract or purchase equipment to beneficiaries to the project.
As to page 75 AGA purchases between beneficiaries are not possible. But an associated partner is no beneficiary. Therefore, we are wondering whether it is possible?
Answer: : First of all, we would like to clarify that the subcontracting costs and the purchase costs of an associated partner in an action (as any other costs incurred by an associated partner) cannot be declared as eligible costs.
However, if you refer to a situation where a beneficiary is subcontracting to or purchasing from an associated partner, it should be noted that:
Question: Which one is the right budget column for associated partners whose action-related costs will be covered by a different funding body?
Should they use "own resources", since it is reimbursement of their own costs?
Or is it "financial contribution" even though the national funding can only be used for the associated partner's action-related costs and not for the remaining consortium?
Answer: The right column to use for funding from a different body is "Financial contribution".
Question: How are the annual workable hours determined in Horizon Europe? Is it the same formula as in Horizon 2020?
See Horizon 2020 Annotated Model Grant Agreement page 69: "Standard annual productive hours for Research Centre Z: Research Centre Z would like to use its usual cost accounting practices to calculate the hourly rates for EU actions. It calculates the number of standard annual productive hours as follows:
Annual working days = 228
- average annual sick leave (days) = 3
- days of general training = 4
- other unproductive activities (days) = 9
⇒ productive days = 212
Multiplied by 8 working hours per day
⇒ standard annual productive hours = 1 696"
In Horizon Europe this is needed e.g. for users of unit costs when not using the 8 hours per day, see page 40 in Horizon Europe Annotated Model Grant Agreement:
"If your usual cost accounting practice is to calculate hourly rates instead of daily rates, you must convert the hourly rate into a daily rate as follows:
Daily rate = hourly rate x 8
Alternative: If you have a usual cost accounting practice determining the standard number of annual productive hours of a full-time employee, you can alternatively multiply by the number of hours resulting from the following formula (instead of by 8):
{The higher between the standard number of annual productive hours of a full-time
employee according to your practice and 90 percent of the standard annual workable hours of a full-time employee divided by 215}".
Answer: The "standard annual workable hours" can be considered as a relatively well-established general concept referring to: the standard number of hours during which a full-time employee of a given reference group must be working, at the employer's disposal and carrying out his / her activity or duties under the employment contract, applicable collective labour agreement or national working time legislation.
In that sense, there will be no different approach between Horizon 2020 and Horizon Europe on that issue.
Question: A German beneficiary is SME with two managing directors, both being shareholders at the same time (each holding 50 percent of the SME). Both CEOs / managing directors are main knowledge carriers and work (documented with time sheets and so on) for the Horizon Europe action. Each person has a managing director's contract since years with elements like a monthly regular renumeration, working time regulations, vacation entitlements, appliance of the law of employee invention, et cetera. Both persons are registered in the monthly payroll system of the company, and employment related taxes (in Germany: Lohnsteuer (income tax), Kirchensteuer (church tax), Solidaritätszuschlag (solidarity surcharge)) are being deducted from the monthly salary net payments and accordingly paid directly to the tax authorities by the company.
Due to special rules of the German social security system both are not subject to social charges. Which personnel cost category should be applied for managing directors who are at the same time shareholders / owners and receiving a renumeration / salary as mentioned above?
Answer: Generally speaking, there are two possible cases for declaring costs of (co)-owners of Small and medium-sized enterprises (SMEs) in Horizon Europe actions:
You can find detailed information about these two cases in the Horizon Europe Annotated Model Grant Agreement under the abovementioned articles.
Question: We have a question about the situation of company owners who have an employment contract in their company and are paid regularly according to this contract - quite a common practice in Germany.
In national funded projects there is sometimes a difference in the treatment of personnel costs depending on whether project employees are subject to social insurance or not. In the Horizon Europe Annotated Model Grant Agreement we couldn't find anything about this and we had the assumption that SME owner could therefore be considered as "personnel working for the beneficiary under an employment contract" and actual costs could be applied. Now - for the first time - we were informed about a concrete case, where during the course of an audit (third parties audited on behalf of the Commission) the actual costs of the SME owner were reduced to unit costs.
This was justified as follows: "The monthly remuneration is recorded in the personnel expenses of the [company], however according to German legislation the two managing directors are not subject to social charges. This means that [the company] is not paying social contributions for the management, also not on a voluntary basis, which is possible under German law. Moreover, both SME owners are also not subject to any pension insurance contribution, which is usually also typically for the remuneration received by an employee and which qualifies as a salary according to German law. We therefore consider that the monthly remuneration received by both SME owners does not fulfil the criteria of a salary as per the Annotated Grant Agreement."
Up to now, we have been convinced that if the SME owner is subject to social security contributions, this is the standard, but not that a corresponding requirement can be derived from the Annotated Model Grant Agreement.
Answer: The Horizon Europe Model Grant Agreement distinguishes two different situations with regard to the declaration of costs for SME owners:
In most cases, the fact that the company pays social security contributions, as well as contributions to the public pension schemes, for the person are objective indicators that the person is subject to an employment contract qualified as such by national law. Therefore, when the company does not pay those contributions for the person hired, that is typically the case of a contract that does not qualify as an employment contract but as a service contract or other contractual relation.
Finally, please note that it is not possible for a SME owner not receiving a salary to charge costs to Horizon Europe grants as "costs for natural persons working under a direct contract" (article 6.2.A.) even if the SME owner signs a direct contract with his / her own company.
Question: As a L&F NCP I was contacted by a client concerning the guiding remarks in the HEU AGA on page 38 to parental leave.
The GA states in Article 6.2.A.1 "The actual time spent on parental leave by a person assigned to the action may be deducted from the 215 days indicated in the above formula."
On page 38 in the AGA it is written "“Parental leave (HE, HUMA) — If provided in the Grant Agreement, if you incur cost for parental leave (i.e. are not fully reimbursed by other sources such as national schemes) for personnel working on the action, days on parental leave during the reporting period may be deducted for the calculation of the maximum declarable days and the calculation of the daily rate […]”
Can you please clarify, under which conditions the days of parental leave can be deducted from the max. declarable days? Only when the beneficiary/ employer has occurring costs?
In Germany the employer itself has costs only in the beginning for the time of maternity leave - the parental allowance during the parental leave is paid for by the state as the parental allowance is a replacement benefit for the previous income.
Can the days of the parental leave still be deducted from the maximum.declarable days?
Answer: As regards parental leave and the daily rate calculation, please note that:
For the calculation of the actual personnel costs over the reporting period duration (numerator): you may only include personnel costs you actually and definitely incurred for that person. From what you indicated in your question, this would mean, in your case, only the maternity leave-related costs but not the parental leave-related costs as the latter are paid for by the State.
For the calculation of the maximum declarable days-equivalent (denominator): A beneficiary can always deduct the number of day-equivalents spent on parental leave (regardless if paid by the beneficiary or not).
Question: In the Horizon Europe AGA, Article 6.1(a)(ii) states: “eligible costs must be incurred in the period set out in Article 4”.
This is the same wording as in the H2020 AGA, Article 6.1.
However, as we understand it, concerning eligible costs and the calculation of the hourly rate there has been a change from H2020 to HE.
In H2020, some costs had to be “apportioned” to be eligible.
For instance, the 13th salary or special holiday allowance had to be apportioned with 1/12 of the cost to be allocated and recorded on a monthly basis.
This was a rather time consuming and manual procedure that often led to errors.
Horizon Europe introduces a new methodology for the calculation of the Daily Rate.
If the reporting period is 12 months, all the salary costs recorded for the person during this period have to be summarized and divided by 215.
As we understand it, this could also include costs generated before the 12 months period if these costs are recorded and booked in line with the beneficiary´s normal internal procedures.
Please confirm if this is correctly understood?
If so, the HE AGA Article6.1(a)(ii) might need a short explanation concerning the meaning of “incurred in the period”.
An example might illustrate the challenge.
A beneficiary has recently had an audit of an EIT Health KIC project following the new HE rules.
In this case, the auditor insisted that eligible costs could not include any costs generated outside the reporting period – even if these costs are recorded and booked in line with the beneficiary´s normal internal procedure.
Answer: In Horizon Europe, the total eligible personnel costs incurred over the reporting period duration (numerator of the daily rate formula) will have to be calculated on the basis of the usual cost accounting practices of the beneficiary. This means that for the cases of 13th salary entitlement (or similar entitlement), the beneficiary will apply its usual accounting practice, i.e.:
In this respect, the ‘generating event’ will depend on the beneficiary’s usual practices: being either each monthly accrued amount or being the full amount paid of the 13th salary.
Question: In H2020, the AMGA stated that for beneficiaries using the monthly hourly rate: “Beneficiaries may declare personnel costs incurred in periods of parental leave in proportion to the time the person worked on the action in that financial year.”
However, in Horizon Europe the reference to “in proportion to the time” seems to have been abandoned.
Instead, the Horizon Europe AMGA states: “The actual time spent on parental leave by a person assigned to the action may be deducted from the 215 days indicated in the above formula”.
This is indeed a simplification, but several beneficiaries have doubts how this will work in practice.
An example might illustrate the challenge.
Assume a Horizon Europe project starts 1 of Jan. 2023 and the first reporting period is 12 months.
Ms. X starts working on the project as of 1 of Jan. 2023.
However, as of 1 of Feb. 2023 Ms. X goes on 11 months parental leave.
Assuming Ms. X has a normal salary of 2000 EURO/month and during her parental leave the beneficiary incurs a parental leave cost of 1000 EURO/month.
In that case, the total annual salary costs for Ms. X would be (2000 + 11 x 1000) = 13.000 EURO.
However, Ms. X only worked for one month = 18 days on the action during 2023.
This would mean that for 2023 the daily rate for Ms. X would be 13.000 EURO/ 18 days = 722 EURO/day.
Please confirm if this calculation is correct?
We know this is a rather special case, but we would like to have clarified if we have overlooked any details.
Answer: As a first remark, the reference to ‘beneficiaries may declare personnel costs incurred in periods of parental leave in proportion to the time the person worked on the action in that financial year’ was indeed relevant for the monthly calculation option in H2020. Otherwise, without this specific/side calculation, it would not have been possible to declare such costs for the beneficiaries.
Then, both in H2020 for the annual daily rate calculation and in HE for the daily rate over the reporting period, the formulas for deducting parental leave are similar (i.e. they both refer to the possibility to deduct actual time spent on parental leave).
In accordance with Article 6.2.A.1 of the Horizon Europe Model Grant Agreement (HE MGA), the costs incurred during periods of parental leave which are not fully covered by other sources can be charged to the grant and the actual time spent on parental leave by a given individual may be deducted from the denominator of the daily rate formula and for the calculation of the maximum declarable days. In other words, the maximum declarable day-equivalents may be reduced by the number of day-equivalents spent on parental leave.
Against that background, the correct methodology according to Article 6.2.A.1 and based on the information you provided would be the following:
Although the result of your calculation is correct, please note that the step 13.000/18 could be source of confusion. In this regard we underline the importance of subtracting the number of day-equivalents spent on parental leave for the calculation of the maximum declarable days and the daily rate.
Question: I have a question concerning bonus payments as part of the basic remuneration in H2020. According to the AGA the payments must "be paid in accordance with national law, the collective labour agreement and the employment contract/equivalent appointing act". In our case the bonus payments are not in the working contract but in a written instruction of the managing director. Would this be sufficient of the other requirements of Article 6.2.A are fulfilled?
Answer: We understand from your question that you wish to know whether bonus payments through written instructions of the Managing Director (but not included in employment contracts) can be charged as part of the ‘basic remuneration’, on the condition that the other requirements from Article 6.2.A.1 H2020 Model Grant Agreement are fulfilled.
If the bonus is not set out in the contract, collective agreement or higher law, for it to be eligible the bonus system must be established in the beneficiary's internal rules, or at least be documented and known by the employees. Moreover, the bonus must be based on objective conditions that must be defined in those internal rules. Objective conditions of attribution refer to elements that are not subject to arbitrary/discretionary decisions. An example of an arbitrary bonus could be a bonus granted at the entity /manager’s discretion.
The beneficiary must assess the specific bonus system in the light of the information here above to decide on its eligibility.
Question: Is a legal entity with one PIC obliged to use the same method for conversion for all its institutes and all its employees? Or can different institutes of a legal entity use different methods as long as it is consistent and based on objective criteria and appropriately documented in case of an audit?
Does the conversion method also need to be the same for all projects and all employees in one entity?
For example, institute A) of the legal entity uses the 8 hours option for the conversion into days. Institute B) of the legal entity uses the second option with the average number of hours that the person must work per working day according to the contract (AMGA page 119).
Answer: We understand that your question refers to the conversion methods from hours to day-equivalents when calculating personnel costs under Horizon Europe.
If the beneficiaries’ usual cost accounting practice is to calculate hourly rates instead of daily rates, they must convert the total hours worked into day-equivalents to calculate the personnel costs for the grant. This conversion must be done each time that they calculate a daily rate. To make this conversion, the number of hours worked by the person on the action during the reporting period has to be divided by the number of hours of a day-equivalent.
In order to determine the number of hours of a day-equivalent, Article 20 of the Annotated Grant Agreement (AGA) provides for 3 methods of conversion.
In this regard, beneficiaries can choose any option for the conversion of hours into days, as long as the method chosen complies with the specific conditions and is applied consistently. The level of consistency requires using the same option at least per group of personnel employed under similar conditions (e.g. same type of contract, same cost-centre). Therefore, beneficiaries cannot use the most favorable option for each employee individually. In this context, if there are differences between institutes in a legal entity and if the respective options are applied in a consistent manner by each institute, this may justify the use of different options for conversion.
Question: A researcher, working full time on a H2020 project, was dismissed with immediate effect and asked to stay home for the time of his notice period (‘Garden leave’). Following the national law, the researcher was paid during that period (two weeks).
Answer: We understand that your question relates to whether, it can be charged to the project the costs of an employee during the notice period or “Garden leave”.
The “Garden leave” is a practice deriving from a decision of the employer whereby the employer decides that a person leaving a job (either because of resignation or having an employment relationship terminated) does not work during the notice period while the person still remains on the payroll. Accordingly, the “garden leave” is considered as normal working time. Since the person is not working in the EU action, it cannot be eligible for funding.
Question: We have been contacted by a client who reported a problem regarding the calculation of the daily rates for employees without a fixed salary or working hours but only an hourly rate.
The daily rates for personal with these kinds of contracts are significantly lower than the daily rates of comparable personal with other contracts. This is due to the formula which does not respect the entitlements of employees (with hourly rates without fixed salary or working hours) to continued payment of remuneration in the event of illness, vacation and public holidays on the basis of the average hours worked in the last 3 months prior to the beginning of the incapacity to work. These entitlements result from the German social security law namely the Continuation of Remuneration Act (in German Entgeltfortzahlungsgesetz explained here: https://www.haufe.de/personal/haufe-personal-office-platin/entgeltfortzahlung-anspruch-bei-arbeitsunfaehigkeit_idesk_PI42323_HI517235.html). We have been contacted by a client who continues payments to his employees in cases of the non-ability to work in a comparable manner to employees with different contracts (in line with the law mentioned). No hours are reported for these days but payments are made (due to illness, vacation, national holiday and all the other reasons which allow paid absences). Normally these absences are respected in the maximum of 215 declarable days. But the formula for the personal with hourly rates does not include such a correction mechanism for (part time) employees using the hourly rate.
Would you please give me an advice how to proceed in that case?
Answer: Please note that we cannot validate individual cases, but only provide general guidance and that the answer provided is only based on the information you have provided within your query.
We understand that your question refers to the methodology to calculate the daily rates in Horizon Europe in the case of contracts without fixed salary/hours (employee with hourly rate).
In line with Article 6.2.A.1 of the draft AGA (version 1.0 of 1/04/2023: aga_en.pdf (europa.eu), page 53), the maximum number of declarable day-equivalents for employees that do not have a fixed amount of salary and working hours defined in their contract but only an hourly rate (where allowed by applicable law and not fitting under other cost categories, e.g. SME owners, Subcontracting) can be calculated as follows:
{((total salary paid to the employee in the reporting period) divided by (hourly rate fixed in the employment contract)) divided by 8 [default day conversion factor]}.
In the case of part time employees mentioned in the last part of your query, the default day conversion factor of 8 hours is multiplied by the working time factor as for any other employee.
Once the maximum number of declarable day-equivalents is calculated for the employee with hourly rate, the daily rate for that employee for the reporting period is calculated as for any other employee with fixed salary and hours.
In line with Article 6.2.A.1 of the draft AGA (version 1.0 of 1/04/2023: aga_en.pdf (europa.eu)), for calculating a daily rate per person for the reporting period for any possible situation (irrespective of full-time, part-time, partial hire etc.), you have to use the following formula:
{actual personnel costs during the months within the reporting period}
divided by
{maximum declarable day-equivalents}
Question: Assuming a Horizon Europe project starts on the 1 of Jan 2023 and the first reporting period is 12 months.
Mr. A is employed as a Ph.D. student at the beneficiary since 1 of Jan 2020.
Mr. A is not working on the project while he is a Ph.D. student.
Mr. A has a monthly salary of 1000 EURO while he is a Ph.D. student.
On the 1 of April Mr. A finish his Ph.D. studies and continuous to be employed by the beneficiary as a post.doc.
As of 1 of April Mr. A’s salary is increased to 3000 EURO/month.
As of 1 of May Mr. A starts working on the Horizon Europe project.
What daily rate can the beneficiary claim for Mr. A’s work on the project during 2023?
3 x 1000 + 9 x 3000 / 215
3000 + 27000 = 30000 / 215 = 139,53 EURO/day
Is this calculation correct?
Ms. B is also employed as a Ph.D. student by the same beneficiary.
Ms. B is not working on the project while she is a Ph.D. student.
Ms. B has a monthly salary of 1000 EURO while she is a Ph.D. student.
On the 1 of April Ms. B finish her Ph.D. studies and is no longer employed by the beneficiary.
Ms. B is unemployed for two months.
As of 1 of June Ms. B is employed as a post.doc by the beneficiary and starts working on the project.
As of 1 of June Ms. B has a salary of 3000 EURO/month.
What daily rate can the beneficiary claim for Ms. B’s work on the project during 2023?
7 x 3000 / (215/12 x 7)
21000 / 125,41 days = 167,45 EURO/day
Please clarify if the Daily Rate calculation examples above are correct.
Answer: Thank you for consulting the Legal and financial helpdesk. Please kindly note that the Research Enquiry Service is not in a position to assess (series) of specific cases and/or (real-life/hypothetical) examples and make all corresponding calculation validations but can only provide general guidance regarding the correctness and appropriateness of the methodology, based on the information provided (which may be numerical if this is a helpful illustration of a general issue).
Based on the limited information provided in your query, we understand that Mr. A and Mr. B have from May and June respectively an employment contract with the beneficiary, therefore their status would fall within the category of “employees” under Article 6.2.A.1 of the Horizon Europe MGA. As to whether another contract during the same reporting period has to be taken into consideration for the calculation of the daily rate, please note that it is only if the other contract is also an employment contract that the beneficiary sums up the actuals personnel costs under the two contracts (and the maximum declarable day-equivalents calculated individually for each of these employment contracts) to calculate a single daily rate for the reporting period.
Therefore if Mr. A and Mr. B worked for the beneficiary as a PhD student under an employment contract, the actual personnel costs and the maximum declarable day-equivalents for the PhD employment contract during the months within the reporting period must be taken into consideration to calculate the daily rate of the reporting period.
Differently, if Mr. A and Mr. B worked for the beneficiary as a PhD student under a direct contract or agreement (6.2.A.2, A.3 of the HE MGA), only the employment contract under which they worked on the HE project is taken into account to calculate the daily rate of the reporting period.
Question: In this case, the employee was prohibited from working even before the official maternity leave began in order to safeguard the rest of the pregnancy. Under German law doctors may issue a "prohibition of employment" (“Beschäftigungsverbot") which is not the same as sick leave, but rather an early start of the maternity leave or defining less hours to be worked per week. In this case it is without the salary compensation by the health insurer. In H2020 can the time under "prohibition of employment" be added to time of the maternity/ parental leave and therefore be deducted from the annual productive hours?
Answer: We understand that your query relates to whether the time spent under the "prohibition of employment" (Beschäftigungsverbot") can be deducted from the annual productive hours under Article 6.2.A.1 of the H2020 MGA.
Pursuant to the Article above, the actual time spent on parental leave by a person assigned to the action may be deducted from the number of annual productive hours for all options when calculating the hourly rate per full financial year. The definition of “parental leave” should be interpreted in a restrictive way and is strictly limited to any leave directly related to the birth or adoption of a child.
On the basis of the limited information provided and the information accessible online, it is our understanding that the "prohibition of employment" leave is related foremost to illness (due to a pregnancy at risk or because the act of working endangers the employee/child’s health) but not strictly speaking to the birth of a child.
In this respect, this specific situation might be rather considered as (long-term) sick leave instead and may be deducted from the annual productive hours only under option 2 (individual annual productive hours), but not under option 1 (1720 fixed hours) nor option 3 (standard annual productive hours).
Question: My client is a participant in a Horizon Europe project with the first reporting period spanning from November 1, 2022, to April 30, 2024. The client's general accounts were established in CZK until December 31, 2022, after which they transitioned to EUR from January 1, 2023.
To determine the appropriate exchange rate for costs incurred in November and December 2022, is it accurate to assume that the average of daily exchange rates will be calculated over the entire reporting period, encompassing November 1, 2022, to April 30, 2024?
Answer: We understand that you have a query about the exchange rate to be used in case a Beneficiary changes his accounting currency during a reporting period of a Horizon Europe project.
You refer to a project with the first reporting period running from 1 November 2022 to 30 April 2024. Till 31 December 2022 the Beneficiary’s general accounts were established in CZK; from 1 January 2023 the Beneficiary used the EUR.
We hereby confirm that Article 21.3 of the General model grant agreement should be applied: “Beneficiaries with general accounts established in a currency other than the euro must convert the costs recorded in their accounts into euro, at the average of the daily exchange rates published in the C series of the Official Journal of the European Union (ECB website), calculated over the corresponding reporting period.”
This means that the average daily rate calculated over the whole reporting period should be used for the costs incurred in November-December 2022. For the rest of the reporting period no conversion is needed since the costs are already established in EUR.
Question: In the H2020 AMGA on page 50 and on Horizon Europe (HEU) AMGA page 52, parental leave is mentioned. But what is included by the Commission as parental leave? In Belgium there are different types of leaves related to parenthood: 1) maternity leave (prenatal and after birth); 2) birth leave for the co-parent/spouse/partner of the person that gave birth; 3) parental leave for the father and the mother- till the child is 12; 4) leave in the framework of the adoption of a child; Can each type of leave explained above, be seen as part of parental leave as described in the H2020-MGA? And the same for HEU-MGA?
Answer: We understand that your question refers to parental leave. As correctly mentioned, the definition of parental leave given in Article 6.2.A.1 of the Horizon Europe draft AGA (version 1.0 - 01 April 2023) specifies that parental leave refers to any leave directly related to the birth or adoption of a child. As mentioned in the H2020 AGA, the notion of parental leave is interpreted in a similar way, as it covers both maternity leave and other parental leaves. You cannot deduct any other leaves or absences, including long-term sick leave, breastfeeding leave and leave to take care of a sick child. Therefore, leaves not related only to the birth or adoption of a child but to also to other circumstances, e.g. leave to take care of a sick child, are not considered as parental leave under Horizon 2020 and Horizon Europe. Against this background, if according to the national law, a person is entitled to different types of parental leave as described in your query, and this parental leave is directly related to the birth or adoption of a child, this may justify this parental leave until the child is for instance 12 years old. Nevertheless, we insist that we cannot validate individual cases nor interpret the notion of “parental leave” at national level.”
Question: The HE MGA Art. 20.1 states that time declarations have to be signed monthly. However, some beneficiaries have adapted a kind of alternative procedure. The timesheets are first filled in and signed by the researcher on a monthly basis. However, due to travel and other obligations the supervisor will in some cases only co-sign the timesheets after three months.
In case of an audit, will such a procedure be accepted by the Commission?
f not, are there any rules or guidelines specifying how long time the supervisor has to co-sign the timesheet after it has been signed by the researcher.
Answer:In accordance with Article 20.1 of the Horizon Europe Model Grant Agreement, for the recording of personnel costs, time worked for the beneficiary under the action must be supported by declarations signed monthly by the person and their supervisor, unless another reliable time-record system is in place.
In that respect,
Against that background, we are afraid that the “procedure” put in place by some beneficiaries and consisting in signing the supporting documents with a delay of three months is not compliant with Horizon Europe rules.
Question: 1. The audit certificate, can this be issued by the beneficiary's internal auditor?
Answer: This is explained in the AGA – Annotated Grant Agreement (Version 1.0, 01 May 2024, page 70): “In order to formally request the use of the personnel unit cost, the request must be submitted by the organisation’s legal entity authorised representative (LEAR) through the Portal (by entering total staff costs in the last closed full financial year, number of annual work units and country of establishment). It must be supported by an audit certificate (template to be used) provided by a qualified approved external auditor which is independent and complies with Directive 2006/43/EC (or for public bodies: by a competent independent public officer. …“ If the beneficiary is a public body, the audit certificate can be issued by its internal auditor provided that it is a competent independent public officer, otherwise it has to be issued by a qualified approval external auditor.
Question: 2. Non-euro countries; when approving the unit cost, there will have to be a conversion of currency. How does the beneficiary have to address this (which conversion rate needs to be taken into account?).
Answer: This is explained in footnote 6 of the template of the PUCA AUDIT CERTIFICATE ON ANNUAL PERSONNEL COSTS AND WORK UNITS (https://ec.europa.eu/info/funding-tenders/opportunities/docs/2021-2027/common/temp-form/lev/personnel-unit-cost-audit-certificate_en.docx)”:
“If the statutory accounts are in a currency other than the euro, the amount must be converted into euro at the average of the daily exchange rates published in the C series of the Official Journal of the European Union (ECB website) calculated over the corresponding financial year. …”
Question: 3. When reporting the project, the unit costs is in fact in Euro, so an additional conversion shouldn't be necessary, right? Regardless of when the transfer of the grant takes place. Or does the beneficiary need to use the reporting period and conversion rate as in actual cost projects nevertheless?
Answer: Indeed, since the unit cost is in Euro, no additional conversion is needed. Please note that you can make a test calculation by using the wizard available on the Portal: https://ec.europa.eu/info/funding-tenders/opportunities/portal/screen/programmes/horizon/personnel-unit-costs/unit-cost-wizard.
Question: 4. Does the unit cost for personnel affect other parts of the programme such as MSCA and ERC?
Answer: Indeed, once the unit cost is approved, it must be used for all Horizon Europe types of action which are mixed actual cost grants (e.g. RIA, CSA, PCP/PPI, COFUND, ERC, EIC, EIT). However, not for MSCA. (AGA – Annotated Grant Agreement, version 1.0, 01 May 2024, page 69)
Question: 5. For Lump sum projects I assume the Unit Cost can be used?
Answer: Indeed, once the unit cost is approved, it must be used in all HE actions, also to calculate personnel costs for lump sum grants in the proposal’s detailed budget table. (AGA – Annotated Grant Agreement, version 1.0, 01 May 2024, page 69)
Question: We have a question regarding the declaration of personnel provided by a third party giving in-kind contributions.
When preparing the financial report, we do not have access to the actual costs of the personnel made available, because these costs will be invoiced by their employers one year after the period concerned, in accordance with the clauses of the agreement concluded between the third party and the beneficiary. The result is an impossibility of declaring these costs at the time of project financial reporting for the period. These costs can therefore only be declared in subsequent periods, depending on the status of reimbursements to employers at the time of the reporting.
In this situation, should the deferred reporting of those costs from period P1 to period P2 be done via an adjustment or directly in the financial statement for period P2?
Answer: Based on your question, it appears you're seeking guidance on how to declare the costs of personnel seconded by a third party against payment when the costs are not initially known by the beneficiary at the time of interim reporting.
It's crucial to ensure that all costs meet the general eligibility conditions outlined in Article 6.1 of the Model Grant Agreement. Specifically, costs must be identifiable and verifiable in accordance with the beneficiary's usual cost accounting practices. This requirement extends to the costs of seconded persons as well.
The costs should be declared in the reporting period during which they were incurred by the beneficiary. Therefore, if the costs were incurred during the previous reporting period, the beneficiary should make adjustments to the previous financial report in the subsequent reporting period to declare the costs in the appropriate period.
QUESTION: I have a question concerning personnel costs in HEU in cases of sabbaticals or partial retirement. In both cases the person first works full time but receives only part of the salary. The rest of the salary is then paid during the sabbatical leave or partial retirement. The problem is that the person works 100% and the employer pays 100% but part of the salary is paid when the person is not working. Example: Jan- Jun: The person works 100% and only gets paid for example 50% of the salary. Jul- Dec: The person does not work and is on sabbatical / retirement and gets paid the remaining 50% of its salary that incurred from Jan-Jun and as not paid then. Can the full salary be claimed in the project (in case the person works 100% for one HEU project) or only that part of the salary that is paid from Jan-Jun?
ANSWER: From your question, we understand that you are asking how to calculate the daily rate, when during part of a reporting period the person is on sabbatical/partial retirement but still under the employment contract with the beneficiary. Please note that during the period of sabbatical leave or partial retirement, the standard rules for calculating the daily rate apply. When calculating the daily rate, the beneficiary must consider both the time spent on sabbatical leave or partial retirement and the corresponding salary paid during this period. Only days spent on parental leave during the reporting period may be deducted from the calculation of the maximum declarable days and the calculation of the daily rate. Therefore, in principle any other leaves or absences (such as short-time work) cannot be deducted. For additional information, you may consult the annotations to the Article 6.1(a) and 6.2.A in the Annotated Grant Agreement (‘AGA’ see version 1.0 of 1 April 2023, available here: aga_en.pdf (europa.eu)).
Question: This is a question regarding personnel cost calculation in Horizon Europe.
In order to ensure the horizontal ceiling beneficiaries need to take into account the documented working time of an employee across EU and Euratom grants.
What is considered an EU grant? Only the programmes funded 2021-2027 or also H2020 projects? Only projects granted via the EU F&T portal?
What about ESF+ and ERASMUS+ projects managed by national agencies, the latter mostly on lump-sum basis?
Answer: Based on your question, we understand that you are asking for the definition of “EU grants” used in the Horizon Europe Model Grant Agreement, specifically for the purposes of calculating the horizontal ceiling. Article 2 of the Horizon Europe Model Grant Agreement defines EU grants grants awarded by EU institutions, bodies, offices, or agencies (including EU executive agencies, EU regulatory agencies, the European Defence Agency (EDA), joint undertakings, etc). These grants can cover EU programs (or parts of them) under both direct and indirect management, but they exclude those under shared management.
Please note that the Erasmus+ Programme is mainly implemented through indirect management and thus falls within the scope of an EU grant. In contrast, the European Social Fund Plus (ESF+), except for the EU Programme for Employment and Social Innovation, is considered as shared management. Therefore, majority of ESF+ grants are not classified as EU grants for the purposes of calculating the horizontal ceiling. For details regarding the implementation mode of each programme, please contact the relevant EU services.
QUESTION: With the updated version of the Annotated Model Grant Agreement, we noticed an additional explanation on the horizontal ceiling (215 working days per year).
If beneficiaries are reporting their personnel costs (A.1) based on a daily rate for the project period, it is (still) not clear if also the documented working days are capped on a yearly basis.
The AGA already stated that a) for the entire reporting period not more days can be claimed than the number of max. declarable days used to calculate the daily rate. And b) not more costs can be claimed than the eligible personnel costs (recorded in the statutory accounts for the reporting period) used to calculate the daily rate.
We understood that in case an employee is solemnly financed by one EU grant for the entire reporting period, the horizontal ceiling (215 days per calender year) applies.
However, with the updated version we received more questions, if the horizontal ceiling (focussing on the calender year instead of reporting period) may only apply if a person is financed by several EU grants.
For actually enhancing simplification measures and reducing potential errors in the calculation, enforcing the horizontal ceiling (215 days per calender year) only those employees financed by more than one EU grant would be a great improvement. Given the capping mechanisms for the entire reporting period, overcharging of costs the the EU grant is already currently prohibited.
If the horizontal ceiling shall also apply not only across EU grants, but for personnel working only in one EU grant, a clearer elucidation in the AGA (and published FAQ) would be helpful to dissolve the current unfortunately misleading wording in the Annotated Model Grant Agreement.
Could you provide some information, in which cases the horizontal ceiling is to be applied?
Thank you very, very much! For further information on the extent to which this would be helpful to beneficiaries, we would be happy to provide further examples and information.
ANSWER: Please kindly note that the Research Enquiry Service does not validate specific cases but only provides general guidance.
From your question, we understand that you want to clarify in which cases the horizontal ceiling is to be applied.
The new annotations to article 6.2.A.1 (see yellow box page 51 of AGA version 1.0 of 1 May 2024) clarify that the horizontal ceiling is to be respected in cases where work is performed on multiple actions per year. Consequently, the horizontal ceiling does not apply in the case of a person working in only one EU grant in a given year.
Question: Can you confirm, that working / project dinners are generally NOT considered as entertainment or hospitality expenses (as defined in the annotated Model Grant Agreement)?
Answer: We confirm that for a consortium dinner to be eligible, a beneficiary would have to show that the dinner was connected to the action as described in Annex I and necessary for the implementation of the action (article 6.1.(a)(iv)). Generally speaking, a dinner identified as "working / project dinner" would be deemed complying with these requirements. On top of that, the beneficiary will have also to show that the cost of this "working / project" dinner was indeed not excessive and was in line with the principles of "economy" and "efficiency" (article 6.1.(a)(vii) of the Horizon Europe Model Grant Agreement). Conversely, if the dinner was for entertainment and hospitality purposes (i.e. not related and necessary for the implementation of the action), its costs would be ineligible.
Question: Are reservation fees for train seats eligible costs?
In a case brought to us cost for the reservation of train seats operated by Deutsche Bahn were not accepted during the preparation of a Certificate on the financial statement. The institution which asked for clarification is a public body. All travel costs are handled according to federal travel expenses law. Reservation fees are in line with that law and comply with the usual accounting practice of the institution. The auditor rejected the cost because he assumes that they are not necessary to implement the project. I would like to add that trains of Deutsche Bahn can be quite overcrowded and reservations are very common and recommendable.
Answer: According to article 6.2.C.1 of the Horizon Europe Model Grant Agreement travel costs and related subsistence allowances are eligible if they are in line with the beneficiary’s usual practices on travel.
Therefore, if the reservation fees are in line with the beneficiary’s usual practices on travels and systematically used by the beneficiary, disregarding the source of funding (e.g. applied also for non-EU Research Projects), they might be eligible also under Horizon Europe, assuming that they also comply with the rest of the Horizon Europe general eligibility criteria set out in article 6.1(a) (e.g. reasonable article 6.1.(vii)) and are not ineligible costs (e.g. excessive expenditure (article 6.5.(viii)).
Question: According to article 6 (Horizon Europe Model Grant Agreement) currency exchange losses are ineligible costs. What happens if the currency exchange rate provides a profit? Are these considered receipts and have to be declared in the financial statement? Or can these profits which might occur be kept by the beneficiary?
Answer: Currency exchange losses, as established in article 6.3(a)(v) of the Horizon Europe Model Grant Agreement for beneficiaries using currencies other than euros or being invoiced in a currency other than the currency they use, are considered ineligible costs. In the same vein, currency exchange gains are not considered receipts of the action and do not have to be declared as such in the financial statements.
Question: In the Annotated Model Grant Agreement of Horizon Europe, page 42, regarding in-kind contributions, it is stated: “they must be declared under the budget category of the beneficiary if they were its own costs", but it is not clearly mentioned if then seconded personnel free of charge should be mentioned in the budget table under A1, and NOT as A3.
Can you confirm that the costs of seconded personnel for free have to be mentioned in the column A1 of the budget table or as A3? Can you please clarify this?
Otherwise, seconded personnel against payment is clearly stated that it has to be mentioned as A3.
And should in the proposal in table 3.1.j only be listed the in-kind contribution of seconded personnel free of charge and there under the category seconded personnel then? And should seconded personnel against payment be listed or not in table 3.1.j?
Answer: Cost for seconded persons by a third party against payment concerns exclusively the costs of staff that is seconded by a third party to the beneficiary when the beneficiary pays for that secondment and these costs should be declared under category A.3.
Staff seconded free of charge are to be declared under category A1, as if they were the beneficiary’s own employees. The costs declared must comply with the conditions set out in the grant agreement.
Please note that the budget table provides one single column for the cost categories A.1, A.2 and A.3. The amounts corresponding to these categories must be summed up and declared together when filling the budget table.
Regarding table 3.1j of the Horizon Europe proposal templates, in what concerns seconded staff it should include only persons seconded free of charge. Persons seconded against payment do not have to be included in that table. Please note that, as a general rule, for the costs of staff seconded free of charge to be eligible they must be set out in Annex 1. Therefore, it is particularly important to have those costs identified from the proposal stage.
Question: One of the tasks of a project is to do some tests on the children (testing of educational program; agreement of parents is of course anticipated). These kids will receive instead of money some Lego toy (with logo of the beneficiary – it is normally used as promotional material). Could costs of these Lego toys be considered eligible direct costs (other direct cost, consumables)? Thank you for the reply
Answer: In general, a gift such as described in your question does not fulfil the eligibility condition requiring that costs must be necessary for the action (see article 6.1(a)(iv) MGA). If due to the circumstances of the specific case, there are reasons to consider that this cost is necessary for the implementation of the action, we advise you to take contact with the Project Officer in charge.
Question: Where can I see if the foreseen options 2,3 and 4 of Article 6.2.C.2 for eligibility of equipment costs are being open in the topic conditions or if only Option 1 (depreciation costs only) for equipment costs is applicable?
Answer: Your question concerns equipment costs eligibility under Article 6.2.C.2 of the Horizon Europe General Model Grant Agreement (HE General MGA), and in particular eligibility of costs for prototypes.
As you correctly pointed out, the option 1 (i.e. depreciation costs only) is a standard obligation for all EU grants. The three other options (option 2 full cost only, option 3 depreciation and full cost for listed equipment, and option 4 full cost and depreciation for listed equipment) will thus be used as an exception (see HE General MGA pages 28-29, footnotes 21, 22 and 23), only if justified by the nature of the actions and the context of the use of the equipment or assets. In Horizon Europe, the intention would be to use these three other options for a limited number of calls, notably for calls for which the purpose is generally to have beneficiaries developing prototypes.
Against that background, a full cost option can only be activated in a specific grant if it was selected for the call by the granting authority; i.e. if the call for proposals explicitly authorises its use in grants awarded under such call. If not included in the call, beneficiaries will not be able to charge the full purchase costs of the equipment used for a prototype. In practice, you can check if the call and topic includes any conditions for equipment costs eligibility in the topic conditions table that can be found at the beginning of each call and at the beginning of each topic. As an example, option 3 (depreciation costs and full cost for listed equipment) can be found in Cluster 4 Work Programme under the Specific conditions applying to HORIZON-CL4-SSA-SST-MS, HORIZON-CL4-SSA-SST-STM-AE, HORIZON-CL4-SSA-SST-SB, HORIZON-CL4-SSA-SST-SP, HORIZON-CL4-SSA-SST-SD (see page 435-437).
The call CLIMATE NEUTRAL, CIRCULAR AND DIGITISED PRODUCTION 2022 (HORIZON-CL4-2022-TWIN-TRANSITION-01) you refer to has not authorised the use of a full cost option and, consequently, only depreciation costs (i.e. option 1 by default) would be eligible for funding, including for a prototype.
Question: I would like to raise your attention to the following question. A client developed several prototypes in his Horizon 2020 innovation action. For the transport to a partner they were assured. Are the costs for the assurance eligible as direct costs? They are in line with the usual accounting practices of the entity.
Answer: The insurance costs of the transported prototypes are eligible direct costs for the Horizon 2020 action if:
Question: I would like to kindly request your understanding about a specific case in Turkiye and cost (in)eligibility about in-kind contributions.
We have research infrastructures established and operated by Law No. 6550 and they implement their activities by using two types of personnel: Own personnel and seconded personnel (academicians) from universities.
Specific articles in Law 6550 define rules, limits, scope of that secondment.
Besides, these infrastructures are able to pay an extra monthly salary to those seconded personnels in compliance with Law no 6550 but there is a limit defined in the Law. For example, an academician is able to get 2.000 EUR/monthly from his/her university, and if they are seconded to the research infrastructure for a period including that month, they are able to get 500 EUR an extra monthly salary directly from the infrastructure (paid directly by the infrastructure to the academician) for their effort. As I understand, according to Article 6.2.A.3, only 500 EUR is eligible as 1 PM personnel cost when research infra is a beneficiary in a HE project and wish to declare it in financial reporting, because 500 EUR is the only expense incurred by the research infra. In other means, 2.000 EUR cost is incurred and paid directly by the university and so that ineligible.
The question is that, if university is willing to offer that personnel to the infrastructure free of charge, does it mean that infrastructure will be able to declare 2.500 EUR expense for 1 PM work of that personnel according to the Article 6.1 (in-kind for free) of AGA HE? (500 EUR as direct personnel cost + 2.000 EUR as in-kind contribution free of charge). Or is it eligible to declare 2.500 EUR personnel cost for 1 PM effort for that personnel according to the other rules & articles defined in AGA?
Answer: We understand from your query that a research organisation who is a beneficiary in a Horizon Europe action has at its disposal personnel seconded from a third party (academicians from universities) and is making an extra payment directly to this personnel. Yet, it is not entirely clear to us whether the ‘500 EUR extra monthly salary directly from the infrastructure’ is to be covered under
1) an extra employment contract to be signed with the seconded academician or
2) under the secondment agreement.
In the first case, this extra amount can be declared by the research infrastructure in compliance with Article 6.2.A.1 (personnel costs for employees). In the second case, this extra amount can be declared by the research infrastructure in compliance with Article 6.2.A.3 (personnel costs for seconded persons against payment).
Now, this does not preclude the research infrastructure to also declare the other part of the remuneration incurred by the university (i.e. the EUR 2000 monthly remuneration in your example that are not repaid by the research infrastructure) as in-kind contribution free of charge. In that case, and in practice, please note that in Horizon Europe costs related personnel costs of persons seconded free of charge will have to be declared under category A.1 ‘Employees’, as if this person was the beneficiary’s own employee (i.e. declared by the research infrastructure as if the seconded academician were its own employee, in your example).
In any case, in order to be considered eligible, the costs under both budget categories must fulfil the general eligibility conditions set out in Article 6.1 and the applicable specific eligibility conditions laid down in Article 6.2.A.1 or 6.2.A.3 of the HE MGA as explained above. For additional information, you may consult the annotations to the abovementioned articles in the Annotated Grant Agreement (see version 0.2 of 30 November 2021).
This being said, as mentioned above, the Research Enquiry Service can only provide general guidance and is not in a position to assess whether the above conditions are fulfilled in your particular case.
Question: A Client takes part in a H2020-Call within a consortium and whilst preparing the proposal was given the adivce acccording to page 85 of H2020 AGA (Prototype or pilot plants constructed by the beneficiary as part of the action tasks) that the costs for the equipment to be procured for setting up the test lines does not have to be depreciated but can be fully eligible if the laid down conditions on page 85 are fulfilled.
The consortium´s coordinator confirmed this approach as it was matching his experience in earlier H2020-projects, where equipment costs for test beds were declared as consumables (cost category D.3 "other goods, works and services").
As the first reporting is coming to an end their PO stated the equipment costs for the test lines would only be eligible when being declared as equipment costs and also only the depreciation costs would be eligible.
Can you please confirm, that the full costs of the equipment to be procured for setting up the test lines do not have to be depreciated but can be fully eligible if the laid down conditions on page 85 are fulfilled?
In addition, can you please explain, which is the right cost category for prototype costs - category D.2 "Equipment" or category D.3 "other goods, works and services" while declaring the full price
As the client planned his budget for the costs of the equipment to be procured for setting up the test lines in category D.3 he might need to ask for an amendment for changing the cost category.
Answer: In general terms, for the full purchase cost of equipment to be eligible in a specific grant, the corresponding option (option 2) would have to be activated under Article 6.2.D.2. You can see the text of that specific option in the Horizon 2020 General Model Grant Agreement
If that option is not activated in the grant agreement, the Horizon 2020 Annotated model grant agreement explains indeed in page 85 the particular case of eligibility of costs of prototypes or pilot plants constructed by the beneficiary as part of the action tasks. That is an assessment to be done on a case by case basis, notably to determine if the action task do qualify as a prototype or pilot plant. The beneficiary should, therefore, discuss the issue with the EU project Officer in charge of the specific grant.
If none of the two cases above apply to the specific grant, the general provisions for equipment, i.e. eligibility of depreciation costs of equipment, infrastructure or other assets, would apply.
Regarding the category under which the costs would have to be declared, if the items are recorded in the accounts of the beneficiary as fixed assets, they should be declared under 6.2.D.2.
Question: I received a question regarding the eligibility of maintanance costs for test facilities in Horizon Europe. The maintenance costs are incurred regularly and they are necessary for the operation of the test stand. Our client wants to know if he can report these costs partially as project costs in the category C3 other goods works and services or C2 equipment.
Answer: Thank you for consulting the legal and financial helpdesk. Please kindly note that the Research Enquiry Service provides general guidance only but cannot comment on the specificities of a particular case.
Regarding costs for equipment, as a general rule, day-to-day maintenance costs typically qualify as indirect costs under Horizon Europe. Therefore, they would be covered by the 25 percent flat rate under Article 6.2.E of the Horizon Europe Model Grant Agreement and cannot be declared as direct costs.
Only in very exceptional cases maintenance costs could be declared as direct costs for the action. This may be the case if the maintenance cost for the action has been directly measured and is justified by supporting evidence showing the link with the action (i.e. to qualify as 'direct cost' the cost for the action cannot be calculated by using apportionment methods, key drivers or proxies). In addition, considering maintenance costs as direct costs would have to be the usual cost accounting practice of the beneficiary.
Question: I have a question concerning associated partner in lump sums projects. How will the Commission proceed in case a work package for which beneficiary A) and an associated partner are responsible. In case the WP is not completed only because the associated partner has not finished its work but the beneficiary A) has completed all its tasks. Will the budget for WP to the beneficiary A) be paid full? Or will it be reduced because the associated partner has not finished its work even if he does not get any EU contribution?
Answer: We understand that your enquiry concerns a situation where only one beneficiary and an associated partner are responsible for the same work package (WP) in a Horizon Europe lump sum action.
Firstly, we would like to recall that the EU contribution in a lump sum grant is paid for the accomplishment of work packages (“lump sum shares”). As set out in Article 22 of the specific lump sum MGA, one lump sum share is fixed in the grant agreement for each work package (Annex 2 of the grant agreement, “Estimated lump sum breakdown”).
In this respect, if a given work package is partially accomplished, for instance due to the non-completion of some action tasks attributed to an associated partner like in your example, this will have consequences on the payment of the corresponding lump sum share. More precisely, and in compliance with Article 21.2 of the Lump sum MGA:
In any case, and in accordance with Article 7 of the lump sum MGA, beneficiaries retain sole responsibility towards the granting authority and the other beneficiaries when relying on other participants (including associated partner).
Question: I was contacted by two clients with the same question regarding the application process for projects which are funded in the lump-sum scheme. Both projects are confronted with very high project costs. The maximum EU contribution in both projects will be significantly higher than the requested EU contribution. The question is: How shall this be shown in the application process? The table Part A.3 does not allow anymore to request a lower EU contribution. One Option could be to indicate the "real" project cost in the Excel Sheet to request another amount in online table. But this would not illustrate that there are only single beneficiaries willing to contribute own resources. In one case the difference between maximum EU contribution and requested EU contribution is more than a 1 Mio Euro. This project fears a negative impact on the evaluation if the additional costs (own resources committed for the project) can not be shown.
Answer: The total project costs are covered in the Excel detailed budget table (at the bottom of each beneficiary individual sheet and in the lump sum breakdown table, with funding rate applied).
In the Part A of the application form, those applicants bringing own resources should encode a lower amount in the column “Requested grant amount”.
In the “Any comments” tab of the Excel file, applicants can mention that the Excel table covers their full project costs, but that they will bring own resources. They can specify the amount of their own contribution (in EUR) and explain that this will be reflected in a lower requested grant amount in the Part A budget table. In the Part B of their application, they can briefly mention/explain their own resources.
If the project is selected for funding, the Annex 2 of the grant agreement (based on the lump sum breakdown table in the Excel file) must be adapted for those applicants with own resources, to reflect the LS share they are requesting.
Question: We have a question on the understanding of Art. 22.5.1 GA: "Late-payment interest is not due if all beneficiaries are EU Member States (including regional and local government authorities or other public bodies acting on behalf of a Member State for the purpose of this Agreement)."
Does that mean, that an university being a public body according to public national law falls under the definition of MST in 22.5.1? Does this provision applies only if the whole consortium consists of public body beneficiaries or also if you have a mixed consortium (private/public) or does paying late interests depends on the status of the organisation?
Answer:From your question we understand that you are asking about what type of beneficiaries should be considered as ‘EU Member States’ in relation to article 22.5.1 of Horizon Europe Model Grant Agreement (MGA) stating that ‘late-payment interest is not due if all beneficiaries are EU Member States’.
Please note that the case where a ‘beneficiary is a EU Member State’ should be understood as referring notably to a government authority (including regional and local government authorities) or a public body that is empowered by a EU Member State to act on its behalf in specific action. In that context, you may have entities with ‘public body status’ which are not necessarily acting on behalf a EU Member State.
Question: A complete Lump-Sum Excel table needs much more details than actually have to be available in the first stage. Will the Lump Sum Excel table need to be filled in at stage-1 already or only in stage-2? If so what is the level of budget detail expected in stage one?
Answer: The Detailed budget table (HE LS) is not required for STAGE-1 submission. When submitting Stage-1 proposals, in general, applicants are not required to provide a detailed budget, but a TOTAL Requested EU contribution to eligible costs (Requested grant amount) – EUR.
The Standard application form (HE RIA IA Stage 1) published in the Funding and Tenders Portal provides a clear indication of how Part of A of the proposal is structured, including the budget.
The Lump Sum Excel table needs to be filled in only at Stage-2.
Question: According to the LS MGA (Art. 6): „Lump sum contributions are eligible, if: … (b) the work packages are completed and the work is properly implemented by the beneficiaries and/or the results are achieved, in accordance with Annex 1“. The Annex 1 includes a Staff effort table (including number of PMs per beneficiary and per work package).
Can you confirm the staff effort table in annex 1 of the lump sum GA is not binding for the beneficiaries? The other option would be that since the number of PMs is binding in the GA, the beneficiaries that implement the activities with significantly different real staff effort breach the Grant agreement and related lump sum contributions are ineligible under art. 6 of the MGA.
Answer: At proposal stage, the information on staff effort (table 3.1f in Part B of the proposal) must correspond to the information provided in the detailed budget table.
At grant preparation, this information is transferred automatically into Part A of Annex I Description of the Action (DoA) of the grant agreement (GA), taking into account any change done to this table as a result of the evaluation.Once the lump sum grant is signed, the proper implementation of the work as described in Annex I is the only thing we will assess (not the person-month actual number). It is certainly in the interest of the beneficiaries to not deviate too much from what was planned behind person-month efforts and distribution over work packages, to be able to implement properly the work. At the same time, the staff effort table in Annex I will not be checked, because for lump sums, there is no specific report on the use of resources, including no explanations for person-months per work package.
However, at reporting stage, the technical report should still detail who did what (at the level of the participating organisations, not at the level of individual staff), indicating the contributions from beneficiaries, affiliated entities, associated partners, and subcontractors (if any).Question: Can legal fees and court costs be reimbursed through the project if the dispute in the consortium arises from the implementation of the project? (IP, repayment of funds, poor performance, etc.)?
Answer: In order to be considered eligible, the costs must fulfil the general eligibility conditions set out in Article 6.1 of the Horizon Europe Model Grant Agreement (‘HE MGA’). In particular, for direct cost categories, costs must be directly linked to the action implementation, as described in Annex I.
Against that background, litigation-related costs arising from internal disputes within the consortium would not be costs directly linked to the action implementation, as described in Annex I.
Question: How long are messages from the Project Officer to the project coordinator in the Funding and Tenders portal archived? Forever? Or will they disappear after a defined period? For example, five years after the finalisation of the project?
Answer: Please be advised that such messages will be visible as long as the project remains in the Funding and Tenders Portal.
Question: After several exchanges with the IT Helpdesk, part of our questions regarding roles in the Funding & Tender Portal in the context of financial audits are still pending. Based on these exchanges and on the content of the www pages/ Portal we have been referred to, we kindly ask you to provide further information on the interface between ‘My Organisation(s)’ and ‘My Audit(s)’ sections. For the first two questions, we would like to also understand the differences in terms of validity/ duration of the roles and access to a specific financial audit:
Further questions are:
Answer: We invite you to consult the guidance available in the IT How to: https://webgate.ec.europa.eu/funding-tenders-opportunities/display/IT/Roles+and+access+rights#Rolesandaccessrights-AuditRoles
For further clarifications please contact the IT Helpdesk; https://ec.europa.eu/info/funding-tenders/opportunities/portal/screen/support/helpdesks/contact-form
Question: We have a question concerning the terms of reference for the CFS in H2020. There is a new version of the ISRS 4400 that auditors have to use since January 2022. According to our auditing company there are a few new terms in the revised ISRS that do not correspond with the wording of the ToR of Annex 5 for the certificate, e.g. no limitation to financial information, factual results (findings), engaging party etc. Will there be a new version of the H2020 Annex 5 incorporating these changes? If not, how should auditors proceed in case of discrepancies between the terms of the ISRS 4400 (revised) and Annex 5?
Answer: Please note that we cannot validate individual cases, but only provide general guidance and that the answer provided is only based on the information you have provided within your query.
In principle, a new version of the Annex 5 of the H2020 Gran Agreement is not foreseen.
In the event of elements in the new terms of the ISRS 4400 (revised) preventing the auditors from completing the report in the terms defined in Annex 5, the auditors should disclose the nature of such discrepancies and their impact in the ‘Agreed-upon procedures and standard factual findings to be confirmed by the auditor’ as a further remark in the specific section for that purpose in the report.
Question: I have a question regarding time records. Project partners can choose between paper based and computer-based time recording systems. But it is possible to sign a document (i.e. Word, Excel) with an electronic signature? We have several systems for certified electronic signatures in Germany with a growing acceptance. Universities often use "DFN-Zertifikat". The system is OpenSSL based. Users have to ask personal client certificates (certificate Signing Request) using their university log-in-account (e-mail and personal password). Afterwards they can download and install their client certificates.
The technical standard is described here.
I hope the description is sufficient to answer my question. If electronic signatures of this kind can be accepted, it would be great if this could be included in the Annotated Grant Agreement.
Answer: As regards the technical standards for certified electronic signatures used within your organisation, please be aware that we cannot validate individual cases.
Having said that, as a general rule, it is indeed possible to sign a document (i.e. Word, Excel) with an electronic signature as long as this is accepted as such under the applicable national law, in line with the Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market and repealing Directive 1999/93/EC.
Question: We have a case of a third level audit in H2020 by the Court of Auditors where only the Commission receives an audit report. The audited organisation just received an email stating that there were no findings and the error rate was so low that it will not be reported.
In case the organisation faces a first level audit in the same project will there be the same simplification as in case of a second level audit according to page 190 of the AGA: “However, costs previously audited by the Commission/Agency are NOT counted for the EUR 325 000 threshold and they do not need to be covered (again) by the certificate).”
If yes, how does the organisation verify the audit results of the third level audits and the costs it covered without the audit report? Will this be clarified by the Commission services internally?
Answer: Indeed, according to paragraph 4. “Financial report: Individual financial statements — Explanation of the use of resources — Summary financial statement — Certificates on the financial statements (CFS)”, Article 20, Section 2 of the H2020 AGA — Annotated Model Grant Agreement, it is explicitly stipulated that:
“For the final reporting period, some beneficiaries/linked third parties will also have to submit a certificate on the financial statement (CFS).
Such a certificate is needed if the beneficiary/linked third party requests a total financial contribution of EUR 325 000 (or more) as reimbursement for actual costs and unit costs calculated according to its usual accounting practices (average personnel costs and costs for internally invoiced goods and services).However, costs previously audited by the Commission/Agency are NOT counted for the EUR 325 000 threshold and they do not need to be covered (again) by the certificate).”
Furthermore, the H2020 AGA in Article 22 — CHECKS, REVIEWS, AUDITS AND INVESTIGATIONS — EXTENSION OF FINDINGS provides two separate sections for the audits carried out by the Commission and the audits carried by the European Court of Auditors, i.e:
The exception provided for the CFS in Article 20 refers only to the costs previously audited by the Commission/Agency, i.e to the section 22.1.3, whereas there is no such a provision for the audits covered by the section 22.3.
Question: We received a question from one of our clients. In this regard we would like to ask for a clarification regarding the audit process. Our client wants to voluntarily reduce his personal costs by a fixed percentage. This means he would like to declare all eligible personnel costs but would like to reduce the requested EU Contribution (=all personnel costs incurred are declared, but the beneficiary asks for a much lower reimbursement).
We are now wondering what the possible outcome would be if after a check/an audit a part of the declared direct costs are found to be not eligible or are rejected. In case of such a reduction, what will be reduced: the declared costs or the requested EU-contribution?
The H2020-AMGA gives the following advice: Beneficiaries/linked third parties should declare ALL their eligible costs — even if they are above the estimated budget in Annex 2 (cost overruns). The grant will be capped at the maximum grant amount, but cost overruns may turn out useful, if the Commission/Agency should reject some of the costs (at payment or later on).
According to this, we would assume that the declared costs will be reduced. Can we expect in such a case that the payment for the beneficiary will not change at least if the amount of the voluntarily reduced requested contribution for personnel costs is higher than the capped amount?
Answer: At the time of reporting, the system calculates the ‘Maximum EU Contribution’ automatically by multiplying the reimbursement rate by the total eligible costs accepted. The beneficiary can then request a lower amount (‘EU Requested Contribution’). This lower amount requested does not impact on the eligibility of the costs, neither reduces the Maximum EU Contribution.
If following an audit part of the costs initially accepted are rejected as ineligible, this will consequently reduce the Maximum EU Contribution, which would be recalculated based on the costs eligible after the audit. However, if the EU Requested Contribution (i.e. in this example the lower amount requested by the beneficiary) is still below the recalculated Maximum EU Contribution, the audit adjustment would not have any financial impact (i.e. it would not lead to a recovery). The reason is that, despite the audit adjustment, the beneficiary would still be entitled to an EU contribution higher than the contribution it actually requested.
Question: When is the last possible moment to upload deliverables via the reporting system? Is it possible to upload deliverables via Funding and Tenders Portal the online reporting system Sygma within the 60 days of the final reporting period? Or even later?
Answer: We would like to inform you that it is indeed possible to upload deliverables after the end date of the project, that is during the 60-day period for the final reporting. However, the “new revised due date” cannot be changed and it cannot be set after the end date. In addition to that, the continuous reporting tool is available for three years after the end date of the project to allow reporting on exploitation and dissemination of results after the end date of the action if foreseen in the Plan for exploitation and dissemination.
Question: This is a question on how the Grant Management System (SyGMa) works in practice when there are two procedures ongoing at the same time.
An ERC-H2020 grant is currently pursuing a periodic reporting. The beneficiary would like to launch an amendment to extent the project duration but they would like to confirm if the deadline for the periodic report is automatically suspended until the amendment is signed. If so, they would also like to confirm if, once the periodic reporting is restarted, the period will be restarted where it was suspended or if a new period of 60 days starts.
Answer: Please be informed that our feedback is based on the limited generic information we received and therefore we can only provide general guidance; the detailed evaluation of the specific case rests with the project officer who is the only person to assess the completeness of data and make a decision.
As a general rule, the system takes into account the concomitance of amendment request and an open reporting period only when the amendment request is in status submitted (by the requesting party) or signed. In the case presented, the ongoing reporting period will maintain the old legal data. In any case, the reporting period deadline is NOT suspended automatically.
Coordination between the beneficiary and the Project officer is necessary to evaluate the best way to proceed, therefore we strongly advise the beneficiary to contact the project officer.
If the extension of the project deadline has an impact on the start/end date of the ongoing reporting period or on the nature of the reporting period itself (from interim to final or vice versa), the amendment request cannot be submitted because it modifies legal data for which a reporting session is open. However, in this case there is the possibility to restart the submission of the reporting period (i.e. the Project Officer suspends the reporting workflow and depending on stage sends it to a previous stage) in order to allow the submission of an amendment request) and sign an amendment to modify the data.
Question: For H2020, it is possible for the beneficiary either to do one CFS per reporting period or a single CFS for the whole duration of the action. However:
See H2020 AGA, Version 5.2, page 190. Do the abovementioned rules/principles also apply to Horizon Europe projects (only threshold changed)?
Answer: (sent November 2023): From your question we understand that you would like to know whether the H2020 AGA-explained approach on having possibly interim CFS done but submitted at final stage altogether (upon the condition that their costs would be similar to the costs for a single CFS) could also apply in the context of Horizon Europe. Considering the upcoming revision of the CFS template, we are not in the position to give a formal and conclusive answer for the moment. It may be considered in the future but for the time-being, we will only require and cover the costs for a single CFS at final payment. However, beneficiaries are free to audit themselves whenever they find it necessary and can use the CFS template if they want.
Question: In Horizon Europe, internally invoiced goods and services must be ‘verifiable if there is a check, audit, review or investigation.’ What are the documents required to prove the personnel cost component of a unit cost? Are time sheets required? Do employment contracts and payment information need to be provided, or are internal documents that describe remuneration levels in different staff categories sufficient?
Answer: Firstly, the annotations to Article 20 of the draft Annotated Grant Agreement (AGA) version 01/04/23 (aga_en.pdf (europa.eu)) state that for unit […] costs and contributions declared in accordance with usual cost accounting practices, the beneficiaries must keep detailed records and other supporting documents to:
Secondly, please note that to substantiate that the conditions detailed in the annotations of Article 6.2.D.2 of the AGA are respected, the actual costs in the Internally invoiced goods and services category may be subject to the following general procedures (not exhaustive list):
Thirdly, the annotations to Article 20 of the draft AGA version 01/04/23 also lays out that the following documentation should be kept by beneficiaries for internally invoiced goods and services in HE: accounting records, financial statement extracts, time records (or other records) for the share of personnel costs included in the unit costs, invoices or contracts for maintenance costs, cleaning costs, other services, etc., showing how the actual costs are directly or indirectly included in the unit cost calculation.
It is NOT necessary to keep records on the actual costs incurred (per person/good or service) — unless they are needed to document the methodology in place for calculating the unit cost.
Question: "The EC has added two columns in the final “project overview” report: The “Total Accepted EU contribution shares” and the “Final Grant amount shares”. The way these are calculated is clear. However, what is not clear at first instance is the necessity and the rationale of these calculations, especially since coordinators often take these calculations as the default basis for distributing the EC funds between the beneficiaries.
With the addition of the “Final Grant amount shares”, the EC seems to automatically re-distribute the “Final Grant Amount” based purely on the “Total Accepted EU contribution shares”, without taking into account if a beneficiary has spent more or less than their allocated “Maximum Grant Amount (budget)”.
My questions are therefore the following:
Answer: We understand that your question refers to the rationale for the so-called ‘Project overview’ document which accompanies the letter for the payment of the balance.
Firstly, we would like to underline that the consortium remains free to decide on the distribution of the funding within the internal consortium agreement. This Project overview is provided for information purposes and it does not imply that the consortium must distribute the EU contribution according to it.
However, please note that the “Project overview report” document indicates amounts that will be taken into consideration by the granting authority in the event of certain measures:
Therefore, while the consortium remains free to decide on the distribution of the UE contribution among the beneficiaries, each beneficiary’s financial responsibility in case of recovery after the payment of the balance is limited by its share in the final grant amount, regardless of the distribution of the EU contribution agreed by the consortium.
Question: In case a beneficiary leaves the consortium before the end of the project and before the final report and no cash-flow is available in the project anymore ( 5 percent MIM + 10 percent payment of the balance) does the leaving partner receive money from the EC or only from the coordinator? (when leaving before the payment of the balance and sending the final billing and reporting to EC and the leaving party would be justified to receive its 15 percent for payment of the balance).
Answer: From your question we understand that you are asking what are the Horizon Europe rules regarding the payment for the party which is leaving during the project lifetime.
Please note that detailed rules on how to calculate the amount due at beneficiary termination are explained in article 22.3.2 of Model Grant Agreement.
If the Commission/Agency owes amounts to the beneficiary whose participation is terminated, those amounts are included in the next payment to the consortium (it means that the amount will be included in the next interim or final payment to the consortium). Having said that, it shall be reminded that, in any case, the payments of the EU contribution are made to the coordinator and the beneficiaries are not paid individually. The coordinator must distribute the amounts received to the beneficiaries without unjustified delay (see Article 7 of the H2020 Model Grant Agreement).
But how and when the payments are distributed is an internal matter for the consortium. The amount retained for the Mutual Insurance Mechanism (MIM) will be released and paid to the coordinator (in accordance with the rules governing the Mechanism) at the time of payment of the balance only.
The consortium agreement may therefore provide for a distribution of the contribution which is different from the costs claimed or accepted. For instance, it is up to the consortium to organise internally the immediate payment of the beneficiary whose participation is terminated or if it has no cash flow, to wait for the next payment from the Commission to the coordinator. The decision regarding payment of “its 15 percent for payment of balance” should be also taken by Consortium. In any case, in the consortium agreement provisions remains the exclusive responsibility of the consortium itself.
Question: We receive lately questions on the reporting of interests as in former framework programmes when interests were granted on a bank account. As interest rates on bank accounts rise, will interest rates also need to be reported in financial reporting again?
Answer: We understand that your query relates to the declaration of bank positive interests generated by funds received by a Beneficiary from the European Commission/Agency, in the frame of a grant under Horizon 2020 and Horizon Europe Programmes.
According to Article 8(4) of the Financial Regulation 2018/1046, interest generated by pre-financing payments are not due to the Union budget (except if otherwise provided).
We confirm that, under Horizon 2020 and Horizon Europe, coordinators do not have to declare any positive interest they obtained resulting from the funds paid by the European Commission/ European Commission Executive Agency in the frame of a grant.
Question: In project where beneficiaries have to deliver an interim CFS, how are the thresholds calculated?
If they reach the first threshold and deliver a CFS with the first periodic report, do they then have to deliver a new one if they don’t reach the threshold for the next rapport?
And if they havnet reached the final threshold by the end of the project will they still to deliver a new CFS with the final report covering the whole project period, including the periods covered by an interim CFS?
Answer: As a preliminary remark it is not clear to us whether your question refers to H2020 or to Horizon Europe Framework. In this context, we note that the CFS in both Framework Programmes is only due at the final report, but the approach of having partial CFS per reporting period (but submitted at final stage altogether) is only foreseen in the context of H2020.
Therefore, we have to distinguish:
H2020
For H2020 actions, Article 20.4 of the H2020 Grant Agreement provides that a certificate on the financial statement (CFS) is needed if the beneficiary requests a total financial contribution for the whole project of EUR 325.000 (or more) as reimbursement for actual costs and personnel costs declared on the basis of unit costs calculated according to its usual accounting practices. As such, please note that the EUR 325.000 threshold is counted for the whole project and not per reporting period.
Therefore, beneficiaries have to issue CFS ONLY in the last reporting period and DO NOT have to deliver interim CFS.
However, for H2020 there is certain flexibility for the submission of the CFS. As indicated in H2020 AMGA p.190, Beneficiaries/linked third parties MAY submit either one certificate per reporting period or a single CFS for the whole action.
The certificate(s) may be submitted ONLY with the final financial report. Certificates submitted at any other moment will NOT be accepted (and costs incurred for them will be considered ineligible, because not necessary).
Costs for partial certificates (i.e. one certificate per reporting period) will be accepted ONLY in the last reporting period and ONLY if:
Horizon Europe
According to the Article 24.2 of the Horizon Europe Model Grant Agreement (MGA p. 65), “If required by the granting authority (see Data Sheet, Point 4.3), the beneficiaries must provide certificates on their financial statements (CFS), in accordance with the schedule, threshold and conditions set out in the Data Sheet”.
The CFS threshold is to be calculated separately per beneficiary or affiliated entity for whom financial statements are submitted.
As indicated in the data sheet (section “4.3 Certificates” of the HE MGA Version 1.1. 15 April 2022 page 16), for HE actions, the CFS is scheduled only at the final payment, if the threshold is reached.
The standard threshold for issuing a CFS in the HE is when the requested EU contribution to costs is equal or higher than the amount of EUR 430 000 (or EUR 725 000 for the specific case of beneficiary with a low risk SPA beneficiaries see art. 24.4 of the MGA).
Question: Several external auditors from different countries have expressed their concern in relation to the new CFS template published 15.02.24. They all fear that the number of findings will increase substantially in Horizon Europe. For instance, Agreed Upon Procedure 64 states: “The equipment charged to the action was physically inspected and traceable to the accounting records and underlying documents”.
Some beneficiaries have project related equipment located on the sea floor or on the inland ice on Greenland.
Physical inspection of such equipment is almost impossible.
Will the auditors be allowed to accept photos of the mentioned equipment as an alternative to physical inspection?
The same goes for Art. 6.2.C.3. Other goods, work and services which states: - the actual existence of the sampled items by physical inspection. Many projects will claim reagents, test tubes etc. under this cost category. However, physical inspection of these items will not be possible, since the reagents, test tubes etc. are discharged after use.
Would it be acceptable to skip the physical inspection of these items if the auditor can confirm the other Agreed Upon Procedure 88-95?
Answer: Please note that we cannot validate individual cases, but only provide general guidance and that the answer provided is only based on the information you have provided within your query. We understand that you are referring to CFS under Horizon Europe Framework.
As far as the equipment is concerned, this is not considered as a new requirement compared with the previous CFS. The auditor always needed to obtain sufficient evidence for the equipment to comply with Article 6.1(a)(v) in H2020 [the costs must be identifiable and verifiable]. For HE the same principle applies. In case the physical inspection is not possible, obtaining sufficient evidence by video, or other means it would also be acceptable.
Regarding the “other goods and services”, the physical inspection is applicable only in the cases that it is feasible.