1. Executive Agency for Competitiveness and Innovation (EACI) Intelligent Energy – Europe General contractual and financial topics

2. 2 Contents  General contractual topics  Financial topics

3. 3 The grant agreement  Rights and obligations  Between the EACI and all beneficiaries  One beneficiary will act as co- ordinator with additional responsibilities vis-à-vis the EACI  Core agreement  Special Conditions: account for the specific needs of the IEE program  General Conditions: legal, admin. and financial provisions  Annexes  (I): description of the action  (II): budget of the action  (III): reporting guidelines Elements of the grant agreementCharacteristics of the grant agreement

4. 4 Difference to „normal“ IEE projects  Entry into force:  Partners join the action with accession form – no mandates  Funding:  100% funding – of additional costs

5. 5  The coordinator has a very active role, in particular:  Accountable for implementation in accordance with the agreement Check out the "Implementing your project" corner on our website  Intermediary for communication with the EACI (claims, requests for changes, etc.)  Transfers funds to co-beneficiaries within 30 days of receipt  Responsible for supplying information to the EACI and to the co- beneficiaries Proactively informs the Project Officer (e.g. project summaries, access to project website, upcoming meetings, etc.) Provides proof of transfer of funds to the co-beneficiaries (compulsory)  Establishes payment requests  Co-beneficiaries are accountable for the proper performance of planned work and reporting to the coordinator Roles of the beneficiaries - Article I.3

6. 6 Reporting obligations - Article I.6  Always through the coordinator: 2 original hardcopies and an electronic version in English  Technical progress reports (PR)  Number and periods covered depend on the duration of the contract  Check Article I.6 of the Agreement  Interim report (IR)  Within 30 days of end of reporting period as defined in Art 1.6.4  Includes interim financial statement  Approval is one condition for paying the second pre-financing  Final report (FR)  Within 60 days of action completion  Covers the whole duration of the action  Includes the final financial statement  Special report to demonstrate the national implementation costs  Guidance in Annex III - Templates on EACI website

7. 7 Payment scheme - Article I.5  1st pre-financing is 30% of the contribution  Paid within 45 days of official receipt of the accession documents  Conditional on receipt of financial guarantees if requested  Aggregate amount of 1st and 2nd pre-financing can be up to 60% of the contribution  Conditional on approval of Interim Report and consumption of 1st pre-financing  2 nd pre-financing can represent 60% if the 1 st pre-financing has not been paid, i.e. the requested financial guarantee has not been submitted  Co-ordinator must keep evidence of the 1 st pre-financing transfer to co-beneficiaries  Final balance  Within 45 days of approval of Final Report  Co-ordinator must keep evidence of the 2 nd pre-financing transfer to co-beneficiaries  No audit certificate unless EC contribution to a single beneficiary is above EUR 225,000

8. 8 Neglecting to request amendments can have adverse financial consequences  Article II.13 states:  No oral agreement may be considered as binding  An amendment may not have the purpose or the effect of making changes to the agreement which might call into question the decision awarding the grant or result in unequal treatment of applicants  An amendment must be submitted to the EACI in good time before it is due to take effect and in any case one month before the closing date of the action  Amendments are necessary when, for example:  Beneficiaries change (some withdraw, are replaced, etc.)  Change of name, legal status or bank details of a beneficiary  Extension of contract duration,  Significant changes in Annex I (change in a work package, reporting schedule...)  Budget transfers exceed 20% (between cost categories or between partners)  Without amendment, the EACI will apply the signed agreement, with possible consequences on the eligibility of costs

9. 9 Budget shifts have to be approved by the EACI  Budget shifts do not require an amendment to the agreement provided that:  The budget shifts do not impact the implementation of the action  If they are between cost categories for one beneficiary and the shift does not exceed 20% of the total eligible costs of this beneficiary  If they are between beneficiaries and the shift does not exceed 20% of the total eligible costs of the receiving beneficiary  The request for a budget shift is simple:  through the coordinator to the EACI at the latest together with the final report

10. 10 Other important features  Article I.8 defines communication points  EACI office, to the Head of Unit  In writing, in English, referring to the agreement number, title and acronym  Exchange rate applicable is the monthly accounting rate established by the European Commission and published on its website applicable on the day when the payment order is issued by the EACI (Art.II.16.1)  Publicity activities:  Article II.5 of the general conditions defines the beneficiaries' obligations  Guidelines are available on the Agency's website: http://europa.eu.int/comm/energy/intelligent/implementation/communication_ en.htmhttp://europa.eu.int/comm/energy/intelligent/implementation/communication_ en.htm "Implementing your project" corner: use of the "Intelligent Energy" banner, legal disclaimer, etc.

11. 11 Contents  General contractual topics  Financial topics

12. 12 The rules for eligibility of costs  To be eligible costs must:  be incurred during the period of the action exception: costs related to final report and audit certificated  be connected to the action and necessary  have been budgeted  be identifiable and verifiable according to general accounting principles and participant's internal rules  comply with requirements of applicable tax and social legisation  be reasonable and justified  exclude any profit margin  All costs statements must be submitted in the currency used in the accounts of the beneficiaries

13. 13 Staff costs need to be justified through time sheets  Type of personnel in the category:  Only the staff directly assigned to the action  Calculation method:  Salaries plus related obligatory social security charges and other statutory costs  Only actual costs!  Formal justification through time sheets:  Hours must be recorded using time-sheets (Art II.14.2)  Model is available on the EACI website  Make sure references are complete (agreement reference, beneficiary reference, full name of the employee, full name of supervisor and his/her signature, etc.)

14. 14 Subcontracting has to fulfil conditions on content and contract award process  Subcontracting may only cover the execution of a limited part of the action:  limited tasks outsourced by the beneficiary, and for hiring special expertise  invoices have to mention the contract number as well as the a description of the tasks for which the invoice is issued  EACI asks for copies of invoices (3 biggested invoices) together with cost statement  Subcontracts must be awarded in accordance with Article II.9 of the grant agreement:  Subcontractors should be selected on transparent grounds, to the best offer, taking into consideration price and quality (best value for money)  In a very simplified procedure, three different offers should be obtained and evaluated against common established criteria

15. 15 Requirements for travel costs  Travel and subsistence costs:  Only for staff taking part in the action (travel costs of sub- contractors should be included in the subcontracts)  Based on the beneficiary’s usual practices  no invoices to be attached with cost statement

16. 16 Other specific costs  Are linked to the action or arise directly from requirements imposed by the grant agreement  Cannot be included under the other cost classifications of direct costs  Examples:  Charges for financial guarantees when applicable  Subscription fees to conferences or events  Travel costs for persons who are not members of staff or subcontractors  Miscellaneous costs of organising an event  Dissemination of information, reproduction of documents  Specific evaluation of the action  Costs of audit certificates, when applicable (Article I.5.3 of the Grant Agreement)

17. 17 The full cost model had high demands on the beneficiary's accounting system  No need to be substantiated by accounting documents  Computed as 60% of the total eligible direct staff costs  Obligatory 60% flat rate model  The accounting system needs to be sophisticated enough to substantiate the actual rates used!  EACI can provide a template:  Determine direct salary costs and indirect cost pools of beneficiary  Use ratio "indirect pool to direct salaries" to apply to the direct staff rates  Typical categories:  Indirect general costs necessary for carrying out the action  Administration and management (personnel), depreciation of buildings and equipment, water, electricity, telecommunications and postal charges, office supplies, etc. Full cost model NO LONGER APPLICABLE UNDER IEE

18. 18 What are examples of non-eligible costs?  Value of contributions in kind (e.g. a party who is not a signatory to the grant agreement provides expertise, meeting rooms, brochures etc. free of charge) can not be claimed, as no costs are incurred (no co-ordinator or co-beneficiary has made and accounted for any payments)  Provisions for losses or possible future losses or charges  Unnecessary or ill-considered expenses  VAT, unless the participant can show that he is unable to recover it (In such a case the participant must provide the EACI with proof from his national tax authorities)  Exchange losses

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