24.3.83 Official Journal of the European Communities No C 81/3 
Communication on the granting of financial support for 'pilot' and/or 'demonstration' 
projects in the iron and steel industry pursuant to Article 55 of the Treaty establishing the 
European Coal and Steel Community 
Article 55 of the Treaty establishing the European 
Coal and Steel Community states that the 
Commission of the European Communities shall 
promote technical and economic research relating to 
the production and increased use of steel and to that 
end shall organize all appropriate contracts. 
The research programme financed up to now by the 
Community has proved an excellent way of 
encouraging and performing research on problems of 
common interest. 
In addition to the research activities in accordance 
with the medium-term guidelines for aid to steel 
research (1981 to 1985) ('), there is a growing parallel 
need to establish the feasibility of innovative 
technologies through pilot and/or demonstration 
projects up to the operational stage. This transfer 
of laboratory-based research to pilot and/or 
demonstration projects is an essential element in the 
Community's overall strategy for industrial 
development. 
This need is particularly acute in the iron and steel 
industry because the potential to innovate has been 
seriously weakened by a deteriorating financial 
situation. Numerous valuable new processes and 
technologies have, over the years, been developed in 
the European steel industry but have remained 
unexploited. This has been due, in large measure, to 
the high cost of industrial development, heavy capital 
investment, lack of appropriate funding and technical 
risk. 
It is the Commission's view that support should be 
provided for pilot and/or demonstration projects, the 
results of which will help to improve the 
competitiveness of the Community steel industry. 
The Commission may grant, under the conditions set 
out in this communication, financial support for pilot 
and demonstration projects in the iron and steel 
industry that will permit the transition to industrial 
and commercial exploitation of production 
techniques, processes and plant and products that are 
innovatory in themselves or in their applications and 
for which major capital expenditure is required to 
establish technical and/or commercial feasibility. The 
projects must offer prospects of economic viability 
demonstrated by previous studies and research. 1. The pilot stage is characterized by the construc­
tion, operation and development of an installation 
having an adequate capacity and using suitably 
large components with a view to verifying the 
practicability of theoretical or laboratory concepts 
and/or increasing the reliability of the technical 
and economic data needed to progress to the 
demonstration stage, and in certain cases to the 
industrial and/or commercial stage. 
The demonstration stage is characterized by the 
construction and/or operation of an industrial-
scale installation which should make it possible to 
bring together all the technical and economic data, 
in order to proceed at the least possible risk to the 
commercial and/or industrial exploitation of the 
technology. 
2. To carry out this programme, the Commission 
plans to allocate a total amount of approximately 
50 million ECU for a probable period of five 
years; the funds to be made available annually will 
depend on budget constraints. 
3. Any firm, research institute or other body having 
an activity related to iron and steel, established in 
the territory or the Member States, may submit 
applications for financial aid to the Commission. 
Applications are to be sent in on the attached form 
to the following address: 
Commission of the European Communities, 
Directorate-General for Science, Research and 
Development, 
Iron and Steel Pilot/Demonstration Projects, 
200, rue de la Loi, 
B-1049 Brussels. 
Under the Treaty establishing the European Coal 
and Steel Community, projects must be of value to 
the European Community and in general pref­
erence will be given to projects submitted by at 
least two partners in two different member 
countries. One of the partners must be a steel 
company. 
Applications for aid must be submitted before 
1 February of each year for the current financial 
year. As an exception, projects for the 1983 
financial year may be submitted up to 1 July 1983. 
(') OJ No C 99, 2. 5. 1981, pp. 3 to 5. 4. All projects must relate to the implementation of 
new techniques or technologies with the following 
No C 81/4 Official Journal of the European Communities 24. 3. 83 
objective(s): reduction in production and operating 
costs, improvement in plant productivity, higher 
product quality, reduction in the capital cost of 
plant, development of new processes or production 
facilities, improvement of product performance or 
increase in the range of product applications. 
They must also satisfy the following conditions: 
— they must relate to pilot industrial installations 
or demonstration installations, 
— they must exploit techniques or processes 
which are innovatory in themselves or in their 
application, 
— they must hold out reasonable prospects of 
technical and economic reliability, judging 
from earlier research results, 
— they must be of value to the Community. 
The projects may in particular relate to the 
following fields: 
— sintering and pelletizing, 
— use of coke and its products in the steel 
industry, 
— blast furnace and direct reduction, 
— oxygen and electric steelmaking, 
— casting and solidification, 
— working of steel (furnaces, hot and cold 
rolling), 
— treatment of semi-finished and finished 
products and by-products, 
— use and promotion of steel. 
5. Every project will be examined by the Commission 
on the basis of the following information, to be 
provided by the applicants: 
— a detailed description of the work and of 
previous research, 
— a detailed description of the project, including 
its subdivision into technical phases ('), the 
organization of its administration and its time 
scale, 
— the application prospects of these technologies 
or processes and the technical and/or 
economic benefits obtainable, 
(l) A technical phase is a stage in the project that is of 
technical value in itself ana provides data enabling the 
scientific, technical and/or economic justification of the 
following stage to be assessed and a decision taken on 
whether or not to continue the project. — the financial situation and technical capability 
of the partners in the project, 
— the nature and extent of the technical and 
economic risks inherent in the project, 
— the cost of the project, the cost breakdown by 
technical phases, its prospects of economic 
viability and details of any financial aid which 
the project has received, at an earlier stage of 
research and development, from the 
Community, the Member States or any other 
organization, 
— details of any other financial support by, or 
expected from, the Member States, the 
Community or any other organization, 
— any other information which may justify the 
Community support requested. 
6. After receipt of the applications, the Commission 
of the European Communities will consult a 
committee of highly qualified experts which will 
advise it on the eligibility of the projects submitted. 
The Committee will be chaired by a Commission 
representative. 
The project will be selected on the basis of the 
following main considerations: 
— they must be in keeping with the technical aims 
of the programme of pilot and demonstration 
projects in the steel industry as set out in the 
first paragraph of section 4 above, 
— they must be of value to the Community, 
— they must be in line with the general objectives 
published periodically by the Commission 
pursuant to Article 46 of the ECSC Treaty, 
— they must meet the technical, commercial and 
social requirements and interests of the iron 
and steel industry in the Community, 
— they must be of strategic importance in 
connection with the maintenance and 
improvement of Community technical 
cooperation, 
— they must hold out prospects of industrial and 
commercial viability in the medium term. 
7. The Committee referred to in section 6 will assist 
the Commission with project management and 
may consult specialized committees. 
8. Community financial support may not normally 
exceed 50 % of the total cost of the project. The 
amount will be decided individually for each 
project in the light of its characteristics (section 5), 
selection criteria (section 6), value to the 
Community, other aid received or expected and 
24.3.83 Official Journal of the European Communities No C 81/5 
the amount of risk accepted by the proposers of 
the project. 
The support will take the form of financial aid, of 
which a maximum of 50 % is repayable in the 
event of commercial exploitation of the results. 
The repayment conditions will be laid down in the 
contract. 
9. The Commission will negotiate and conclude the 
contracts necessary for the implementation of the selected projects. To that end it will draw up a 
model contract setting forth the rights and 
obligations of each party. 
The contracts may possibly be concluded on the 
bases of technical phases, each depending on the 
results obtained in the preceding phase. In that 
case, the Commission will, in the light of annual 
budget possibilities, first set aside the funds needed 
to continue the work.