1. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Fit for Health is funded by the European Commission www.fitforhealth.eu Online-Training 6.9.2011 | www Carla Chibidziura | FFG Financial & legal Issues

2. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Overview Financial Issues – Costs IPR issues during proposal phase Consortium Agreement and IPR Project Cash-Flow

3. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ EU funding contribution is defined by: Funding schemes Categories of participants Types of activities (RTD, demonstration, management, training etc.) Basic funding principles

4. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Upper funding limits (direct costs) for Collaborative Project Research activities – general reimbursement – 50% SME – 75% Non-profit public bodies – 75% Universities and other educational org. – 75% Research organisations – 75% Demonstration activities – 50% Other activities – 100% Management activities (part of other activities) – 100% Training activities (part of other activities) – 100% Dissemination activities (part of other activities) – 100%

5. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Maximum Funding Rates For following Funding Schemes: Coordination and support actions: up to 100% Frontier research actions (IDEAS): up to 100% Training and career development of researchers actions (PEOPLE): up to 100%

6. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Slide 6

7. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Example I Funding scheme: Collaborative Project Participant: Research Organisation Type of activity: Research Funding:75% Type of activity: Demonstration Funding:50% Type of activity: Management Funding:100%

8. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Example II Funding scheme: Collaborative Project Participant: Industry Type of activity: Research Funding:50% Type of activity: Demonstration Funding:50% Type of activity: Management Funding:100%

9. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Cost categories Non-eligible Eligible Management RTD Demonstration Other Direct Indirect OverheadOtherEquipment Travel Personnel

10. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ 1.actual = not budgeted, not estimated 2.incurred by the beneficiary keep the documents long enough! 3.during the duration of the project for final report until 60 days after projct end 4.determined in accordance with the usual accounting and management principles and practices of the beneficiary recorded in his accounts Eligible costs I (GA Annex II, II.14) Principles must not be contracdictory to provisions of the Grant Agreement!

11. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ 5.for the purpose of achieving the project objectives consistent with the principles of economy, efficiency and effectiveness costs are essential for achieving project goals 6.they must be recorded in the accounts of the beneficiary 7.they must be indicated in the estimated overall budget in Annex I Eligible costs II (GA Annex II, II.14)

12. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ indirect taxes (VAT), duties, interest owed and debt, provisions for possible losses or charges, exchange losses, costs related to return on capital, costs declared in another EU project, excessive or reckless expenditure Non-eligible costs (GA Annex II, II.14)

13. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Costs indirect costs direct costs project costs eligible for reimbursement eligible costs which can be attributed directly to the project eligible costs not directly attributed to the project but in direct relationship with the project - “Overheads“

14. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Direct costs Personnel costs Definition in GA Annex II Art. II.15.1 Time recording is necessary for all project employees Travel costs Equipment

15. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Personnel costs directly hired by the beneficiary work under the sole technical supervision of the latter remunerated in accordance with normal practices time recording needed! Planning of person-months (~ 140 hours p.m.) good estimation of costs average rate of employees who will be working on the project for budget consider valorisation/pay rise

16. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Travel costs Travel costs are reimbursed according to the rules of your organisation if you are allowed to travel Business Class in your organisation, then it is eligible in the project (if not, not) Flat rates for subsistence list of the Commission for hotel and daily allowances – rates can be reimbursed if mentioned in Annex I during GA negotiations

17. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Equipment only the depreciation costs can be reimbursed in the project Equipment has to be depreciated according to the organisational and national rules only the percentage of use in the project can be reimbursed Depreciation of equipment bought before project start can be reimbursed in FP7

18. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Example: Calculation of depreciation costs research organisation buys equipment (costs: 10.000) for the project which will be used 50% in the EU- project, 50% for a national project After national law the equipment has a depreciation range of 5 years Project duration: 3 years Calculation: 10.000/5 years depreciation range = 2.000 per year 3 project years: 2.000 * 3 = 6.000 6.000 * 50% use in the EU-project: 3.000 reimbursed

19. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Indirect costs Administration costs Rental fee General office equipment Office supplies Electricity and heating costs Phone and copy costs Cleaning costs Mail charges Depends on the overheads-calculation of your organisation!

20. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Funding of indirect costs I (“Overheads“) Real indirect costs 1.a) Real indirect costs of the project (indicated that the organisation has an analytical accounting system) can be taken by all types of organisations 1.b) Simplified method can be used if: calculation of overheads at the level of the legal entity possible; cost allocation with key driver (e.g. personnel), in accordance with usual accounting and management principles no previous registration/certification by the Commission required, for all organisations possible, except for if they had employed 1.a) before

21. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Funding of indirect costs II (“Overheads“) Flat rates 2.a) Standard flat rate (20%) 20% of all direct costs (without subcontracting costs) as indirect costs possible for all organisations, except for if they had employed 1.a) or 1.b) before 2.b) 60% Flat rate (60%) only applicable if the organisation is a SME, university or other research organisation unable to identify its real indirect costs only for R&D projects

22. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Funding of indirect costs III (“Overheads“) Coordination Actions and Support Actions (CSA) max. (no flat rate!) 7% of direct costs (without subcontracting) as indirect costs for all organisations!

23. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Example: Calculation of funding research organisation: 75% for RTD, indirect costs: 60% Personnel costs RTD: 100.000,-- Equipment costs RTD: 50.000,-- Personnel costs Dissemination: 50.000,-- Travel & Equipment costs Dissemination: 50.000,-- Calculation: RTD (75%)Dissemination (100%) Personnel costs100.00050.000 Other direct costs50.000 Indirect costs150.000 * 60% = 90.000100.000 * 60% = 60.000 Funding rate(150.000 + 90.000) * 75%(100.000+ 60.000) * 100% Requested EU contr.180.000160.000

24. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Certificate on the Financial Statements (CFS) GA Annex II Art. II.4.4: mandatory for all beneficiaries, for all interim or final payments, each time the cumulated EC contribution is not yet certified and ≥ € 375.000 BUDGET: under Management – Subcontracting EXCEPTIONS: Projects ≤ 2 years if total contribution ≥ € 375.000 only one CFS at the final payment when Certificate of the Methodology (CoM) of the organisation is accepted by the Commission no CFS for interim only at the final payment

25. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Subcontracting …it is possible to have third parties carrying out parts of the work, but: tasks have to be indicated in Annex I covers the execution of a limited part of the project awarded according to best price-quality ratio (3 offers) carry out work the partners cannot carry out (e.g. homepage, etc.) Framework contracts (between beneficiary and service provider) are also accepted Contract before project start, then no offers are needed

26. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Guide for Applicants: 2.4 Resources to be committed In addition to the costs indicated in part A3 of the proposal, and the staff effort shown in section 1.3 above, please indicate any other major costs (eg. equipment). Describe how the totality of the necessary resources will be mobilised, including any resources that will complement the EU contribution. Show how the resources will be integrated in a coherent way, and show how the overall financial plan for the project is adequate. (Maximum length for Section 2.4 – two pages) Costs in the proposal Part B

27. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Tips for cost description Recommendation: Text hand in hand with a graph illustrating it Common errors: No balanced cost allocation according to the tasks in the project No detailed description why a partner gets a certain amount Inconsistency of Part A and Staff Effort Table – often due to changes in the last minute before handing in Budget limit of the Call not followed!!! – non eligible No explanation and justification of costs like Other Costs, Subcontracting

28. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Overview Financial Issues – Costs IPR issues during proposal phase Consortium Agreement and IPR Project Cash-Flow

29. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ IPR issues during the proposal phase IPR-management in FP7 projects is crucial impact of the project as evaluation criterion is close to IPR-management you have to know what IPR are generated described in detail ways to protect preliminary agreements?

30. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Confidentiality Agreement Non-disclosure Agreement it is often needed to exchange/share certain information before submitting a proposal establishes the obligation of the recipient (i.e. the legal person to whom the information is disclosed) to not disclose the information/ideas to third parties information/knowledge which should be protected shall be described in detail sanctions/fees shall be foreseen if there is a breach of the Confidentiality Agreement/NDA

31. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Letter of Intent (LoI) / MoU both declarations of the intention to conclude an agreement, basic data of the latter agreement e.g. sanctions if the proposal is not submitted could include a roadmap for proposal submission regulation of confidentiality, information exchange etc. LoI model: http://www.kowi.de/desktopdefault.aspx/tabid-77/ http://www.kowi.de/desktopdefault.aspx/tabid-77/ MoU (Memorandum of Understanding) model: http://www.ncpwallonie.be/ncp/ressources/propriete- intellectuelle-1/ModeleMOU.pdf http://www.ncpwallonie.be/ncp/ressources/propriete- intellectuelle-1/ModeleMOU.pdf

32. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Overview Financial Issues – Costs IPR issues during proposal phase Consortium Agreement and IPR Project Cash-Flow

33. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Introduction CA is compulsory – unless otherwise stated in Call CA is a treaty between the project partners (rights and obligations) inside the consortium European Commission is not a party of the CA CA should in principle be negotiated and signed before starting the project Clauses in CA cannot derogate from mandatory provisions of the Grant Agreement/RfP – GA always prevails

34. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Important provisions of CA Consortium bodies technical, financial and general provisions Ownership, Access Rights Dissemination and Exploitation Confidentiality LiabilityResponsibilities Source: Desca

35. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Payments from the coordinator to the partners payment modalities (when, how much etc.) Management Structure (bodies, proxy) Decision-making e.g. 2/3 majority if it suits the project consortium – always carefully calculate who are the ones deciding! Responsibilities and contributions (also in kind) of the partners – when is a partner in breach of contract? Beginning/End of the CA, Confidentiality, Dispute settlement Important provisions of CA

36. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ IPR issues in FP7 (I) Definitions (1): „Background“ Start of project „Foreground“

37. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ IPR issues in FP7 (II) Definitions (2): „Use“: means the direct or indirect utilisation of Foreground in further research activities or for developing, creating and marketing a product or process/service „Dissemination“: disclosure of foreground by any appropriate means (e.g. publication of Foreground) „Access rights“: means licences and user rights to Foreground or Background.

38. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ IPR issues in FP7 (III) Joint Ownership (generated jointly): no joint ownership agreement default regime (Annex II.26) Transfer of ownership: No notification to the European Commission needed, only to the other beneficiaries Transfer to a third party = European Commission may object to such transfer of ownership of Foreground Protection of Foreground: adequate and effective

39. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ IPR issues in FP7 (IV) Dissemination (including publications): Participants shall use/disseminate the foreground as swiftly as possible Consider protection of foreground (IPR) and confidentiality Notification of the other participants of all dissemination activities There must be a plan for use and dissemination of foreground

40. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ IPR issues in FP7 (V) Access Rights: Access rights requests shall be made in writing Compulsory access rights on Background and Foreground are granted when needed by a beneficiary (for implementation or use purposes) negotiate if royalty-free or compensation! exclude Background if necessary

41. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Access rights to background Access rights to foreground Yes, if a beneficiary needs them for carring out his own work under the project Royalty-free unless otherwise agreed before acceding to the GA Royalty-free Yes, if a beneficiary needs them for using its own foreground Either royalty-free, or on fair and reasonable conditions to be agreed For implementing the project For use purposes (exploitation + further research) IPR issues in FP7 (VI)

42. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ There are 4 Models of Consortium Agreements in FP7: DESCA Consortium Agreement Model http://www.desca-fp7.eu/download-desca IP Model Consortium Agreement EICTA for FP7 http://www.digitaleurope.org/index.php?id=32&id_article=163 EUCAR Model Consortium Agreement FP7 http://www.eucar.be/publications/EUCAR%20Model%20of%20Projects% 20Consortium%20Agreement Model CA for the Aeronautics projects in FP7 http://www.aerosme.com/news/article.asp?article=250 CA-Models

43. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ CA Negotiation Coordinator : Has to choose early enough the model Consortium Agreement which fits to the project and adapt it to the project and the Consortium (Annex I!) Send it to all partners for comments, wishes etc. If the comments cannot be taken into account – explanation why it is not possible! Partners : take a careful look at the provisions including decision making, financials, dispute settlement and IPR critically questioning if everything is ok!

44. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Overview Financial Issues – Costs IPR issues during proposal phase Consortium Agreement and IPR Project Cash-Flow

45. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Maximum EU contribution Article 5 of the Grant Agreement maximum that will be reimbursed in a project maximum EU contribution includes: Prefinancing (Art. 6 GA) interim payments final payment

46. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Prefinancing FP7 – just one Prefinancing at the beginning paid to the Coordinator within 45 days after the entry into force of the GA about 160% of the average funding per period (> 2 p.) <= 2 periods: 60-80% of the maximum EU contribution ownership of Pref.: Commission until final payment 5% of the maximum EU contribution goes into the Guarantee Fund, part of Prefinancing

47. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Interest interest of Prefinancing on the account of the Coordinator have to be written into the Form C of every period will be deducted from the max. EU contribution only if the Prefinancing is > 50.000 EUR not valid for interest of interim payments!

48. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Interim Payment(s) paid within 105 days after receipt of the reports by the Commission based on the accepted eligible costs and the upper funding limits for the activities (50%, 75%, 100%) Retention: only 90% of the max. EU contr. is paid during the project lifetime – 10% is held back for the final payment

49. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Final Payment within 105 days after receipt of the Final Report difference between max. EU contribution and amount already paid (~ 10%) Commission orders the Guarantee Fund to transfer the money (5%)

50. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ slides and training will be available for download on the Fit for Health website Information

51. www.fitforhealth.eu The copyright © is owned by the author of this document. Please do not duplicate. Disclaimer: the „Fit for Health project partners do not assume any legal liability or responsibilities for the information provided in this document.“ Carla Chibidziura Expert for Legal and Financial Issues FP7 FFG European & International Programmes Tel: +43 5 7755 - 4009 eMail: carla.chibidziura@ffg.at Contact details Thank you!