Implementing the Community Lisbon Programme - Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions - More Research and Innovation - Investing for Growth and Employment - A Common Approach {SEC(2005) 1253} {SEC(2005) 1289}
Date: 2005-10-12
Institutions: European Commission
Subjects: EU programme, European Employment Strategy, economic and social cohesion, economic growth, research and development, research policy, sustainable development

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 12.10.2005 
COM(2005) 488 final 

Implementing the Community Lisbon Programme: 

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL, THE 
EUROPEAN PARLIAMENT, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

More Research and Innovation - Investing for Growth and Employment:  
A Common Approach 

{SEC(2005) 1253} 
{SEC(2005) 1289} 

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TABLE OF CONTENTS 

Introduction ................................................................................................................................ 3 

Chapter 1 Research and innovation at the heart of EU policies................................................. 5 

1.1. 

1.2. 

1.3. 

1.4. 

1.5. 

1.6. 

Better regulation for new technology........................................................................... 5 

Redeploying State aid towards research and innovation............................................. 6 

Improved efficiency and use of intellectual property................................................... 6 

An attractive single market for researchers................................................................. 7 

Using public procurement to foster research and innovation ..................................... 7 

Better and wider use of tax incentives.......................................................................... 8 

Chapter 2 Research and innovation at the heart of EU funding................................................. 9 

2.1. 

2.2. 

2.3. 

2.4. 

Mobilising public and private resources for key technologies .................................. 10 

European Structural Funds to drive research and innovation .................................. 11 

Improving SME access to finance .............................................................................. 11 

Mobilising national programmes and other sources of funding for European 
research and innovation............................................................................................. 12 

Chapter 3 Research and innovation at the heart of business .................................................... 13 

3.1. 

3.2. 

3.3. 

3.4. 

3.5. 

3.6. 

Intensified university-industry partnerships .............................................................. 14 

Innovation poles and research-driven and industrial clusters .................................. 14 

Pro-active business support services to stimulate research and innovation ............. 15 

Innovation management and social change............................................................... 16 

The potential of innovative services........................................................................... 16 

Establishing a European Industrial Research and Innovation Monitoring System and 
improving intellectual capital reporting .................................................................... 17 

Chapter 4 Improved research and innovation policies ............................................................. 18 

4.1. 

4.2. 

4.3. 

Research and innovation as a priority of the National Reform Programmes for 
growth and jobs.......................................................................................................... 18 

Improved policy analysis instruments........................................................................ 19 

Support to policy learning and cooperation .............................................................. 19 

Conclusion................................................................................................................................ 20 

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Implementing the Community Lisbon Programme: 

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL, THE 
EUROPEAN PARLIAMENT, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

More Research and Innovation - Investing for Growth and Employment:  
A Common Approach 

INTRODUCTION  

To achieve sustainable global competitiveness, the EU has no choice but to become a vibrant 
knowledge  economy.  That  is  why,  in  launching  the  new  Lisbon  partnership  for  growth  and 
jobs1, the European Council singled out knowledge and innovation for growth as one of three 
main areas for action. This Communication specifies the actions in this area in line with the 
overarching new Community-Member States partnership based on the Integrated Guidelines2 
(IG) for the preparation of the National Reform Programmes (NRP) and on the Community 
Lisbon Programme3 (CLP). To highlight full consistency with the CLP and the IG, endorsed 
by  the  European  Council,  the  summary  of  each  chapter  provides  references  to  the  relevant 
documents.Innovation and research policies are central to this, as together they cover the full 
spectrum  of  issues  affecting  the  genesis  of  new  knowledge  and  ideas,  their  use  and 
commercial exploitation.  

Achieving strong and sustainable growth calls for a vigourous integrated policy response. The 
EU  should  mobilise  a  coherent  mix  of  instruments  covering  research,  innovation  and  other 
related  policies.  Coordination  between  the  Member  State,  regional  and  European  levels  is 
needed and European action should support and complement the efforts of national authorities 
and the private sector. The 2002 Barcelona European Council set the goal of raising overall 
research  investment  in  the  EU  from  1.9%  of  GDP  to  approach  3%  by  2010,  increasing  the 
private  funding  proportion  from  55%  to  two-thirds.  Member  States  have  to  reform  and 
strengthen their public research and innovation systems, facilitate public-private partnerships, 
ensure a favourable regulatory environment, help to develop supportive financial markets and 
create attractive education, training and career conditions to achieve this goal. 

The 3% objective and the follow-up Action Plan4 for more investment in research have had a 
mobilising effect on Member States. Nearly all have set targets, which – if met – would bring 
research  investment  in  the  EU  to  2.6%  of  GDP  by  2010.  However,  instead  of  rising,  EU 

1 

2 

3 

4 

“Working  together  for  growth  and  jobs.  A  new  start  for  the  Lisbon  Strategy”  -  COM(2005)  24, 
2.2.2005. 
Council  Recommendation  2005/601/EC  of  12  July  2005  on  the  broad  guidelines  for  the  economic 
policies of the Member States. 
“Common  Actions for Growth  and Employment:  The  Community  Lisbon  Programme”  -  COM(2005) 
330  -  and  “Annex  to  the  Common  Actions  for  Growth  and  Employment:  The  Community  Lisbon 
Programme” - SEC(2005) 981. 
COM(2003) 226. 

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research intensity is more or less stagnant5. In most Member States, increases in public and 
private research investment and the range and ambition  of policy initiatives  fall  far short of 
what  their  national  targets,  let  alone  the  EU  target,  would  require.  Private  investment  is 
particularly  low.  At  the  same  time,  European  innovation  performance  has  not  increased 
enough6. 

World-wide competition to attract research and innovation investment is growing. In addition 
to  attractive  locations  such  as  the  US  and  Japan,  new  competitors  have  emerged,  such  as 
China, India and Brazil. For the EU to remain competitive and sustain its model of society, 
far-reaching reforms are needed urgently. Moreover, the scale of competition is such that no 
Member  State  can  succeed  in  isolation.  Transnational  synergies  should  be  fully  exploited. 
This is the only way to boost research and innovation performance and to turn it effectively 
into more growth and jobs in the EU. A high level of R&D spending and a good innovation 
performance  contribute  to  more  and  better  jobs.  In  addition  research  and  innovation  are 
needed  to  make  the  EU  economy  more  sustainable,  by  finding  win-win  solutions  for 
economic growth, social development and environmental protection. 

This  Communication  builds  on  the  Partnership  for  Growth  and  Jobs7.  It  addresses  the  full 
research  and  innovation  spectrum,  including  non-technological innovation.  It makes explicit 
the commitments taken by the Community Lisbon Programme, by detailing the measures in 
support  of  research  and  innovation  that  will  be  undertaken  and  that  were  described  there  in 
general  terms.  It  outlines  ambitious  actions,  reaching  beyond  the  3%  Action  Plan  and 
innovation  policy  to  date8.  It  strengthens  the  links  between  research  and  innovation,  with 
research  policy  focusing  more  on  developing  new  knowledge  and  its  applications  and  the 
framework  conditions  for  research,  and  innovation  policy  focusing  on  transforming 
knowledge into economic value and commercial success. In line with the Commission’s better 
regulation approach, measures with a potential impact on competitiveness will be subject to 
an impact assessment. 

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6 
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8 

http://www.cordis.lu/indicators/publications.htm  (Key  Figures  2005  on  Science,  Technology  and 
Innovation) and http://epp.eurostat.cec.eu.int/ (Eurostat data). 
http://trendchart.cordis.lu/ (European Innovation Scoreboard). 
“Common  Actions for Growth  and Employment:  The  Community  Lisbon  Programme”  -  COM(2005) 
330, 20.7.2005. 
“Innovation policy: updating the Union’s approach in the context of the Lisbon Strategy“ - COM(2003) 
112. 

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CHAPTER 1  RESEARCH AND INNOVATION AT THE HEART OF EU POLICIES  

Research and innovation need a predictable and favourable regulatory environment to attract 
private investment and to help transfer new ideas to the market. Policies in these areas should 
also  take  account  of  sectoral  specificities,  SME  needs  and  the  role  of  public  research 
organisations,  while  contributing  to  EU  policy  objectives  in  fields  such  as  environment, 
safety, health and transport. Many regulatory and administrative practices affecting research 
and  innovation  are  the  responsibility  of  Member  States.  Nevertheless,  the  Community  can 
both lead by example in its own areas of competence and support Member States in theirs – 
not by intervening more but via better and more focused regulation and policies. 

With  this  in  mind,  all  policies  at  Member  State  and  EU  level  should  be  tuned  to  support 
research  and  innovation  wherever  possible.  They  should  promote  excellence  in  basic  and 
applied  research  while  enabling  firms  to  produce,  acquire  and  use  the  technologies, 
knowledge and finance they need to exploit new market opportunities.  

1.1. 

Better regulation for new technology  

Regulation may help or hinder research and innovation. How it does so depends on its design, 
including  its  impact  on  commercial  risk  and  legal  certainty,  its  timing  and  its  capacity  to 
accommodate  alternative  technical  solutions.  Under  the  ‘Better  regulation’  initiative  for 
improving Community law, impact assessments are now mandatory for all new Community 
legislative proposals. This includes an assessment of the effects of such proposals on research 
and innovation.  

It is also important to have a predictable, anticipative approach to legislation, in particular for 
product market regulation. For this, we need to identify instances where existing legislation or 
standards, or their absence, constitute obstacles to developing and deploying new technologies 
and to the emergence of new markets. Conversely, future regulatory measures should be taken 
into account in planning research and innovation activities. The Commission will step up its 
dialogue  with  stakeholders  to  identify  regulatory  barriers  to  research  and  innovation, 
particularly using European Technology Platforms and Sectoral Innovation Panels to be set up 
under the Europe INNOVA initiative. This will facilitate coherent development of technology 
and of the regulatory environment.  

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The Europe INNOVA initiative is a family of sectoral innovation projects bringing together 
analysis and practical experience. It will start at the end of 2005 and will include: 

•  A  "Sectoral  Innovation  Watch"  to  assess  innovation  performance  in  different  industrial 

sectors and identify drivers and challenges to innovation 

•  Networks  of  industrial  clusters  across  Europe,  organised  by  sector,  to  identify  and 

exchange good practice in related policies 

•  Networks of innovation financing actors, organised by sector, to identify specific needs of 

companies in these sectors 

•  Innovation Panels composed of high-level experts of relevant industrial sectors, academies 
and policy makers to validate the findings of the project and draw policy recommandations 

•  A Europe INNOVA Forum consisting of a virtual platform where any initiative related to 

innovation policy may network and exchange good practice 

The  business  environment  also  depends  on  the  quality  of  regulation  and  its  efficient 
implementation. This means building Community regulation into national legislation without 
adding layers of bureaucracy to national rules, and adopting research and innovation-friendly 
administrative  practices.  Member  States  are  invited  to  transpose  and  apply  Community 
legislation in a way that will promote research and innovation. 

1.2. 

Redeploying State aid towards research and innovation  

Research and innovation generally thrive best in open and competitive markets. However, as 
explained in the State Aid Action Plan9, market failure may hamper the delivery of optimal 
levels  of  research  and  innovation.  State  aid  among  other  policy  tools  can  tackle  market 
failures  and  change  the  incentives  of  market  participants,  thus  facilitating  research  and 
innovation.  While  existing  rules  already  provide  wide  possibilities  for  Member  States  to 
support research and innovation through State aid, the Commission has announced that it will 
review its rules to better reflect Community policy priorities and the need for a more research 
and innovation-friendly system.  

To this end the Commission has recently launched the consultation document on State aid for 
Innovation, which puts forward concrete proposals to improve State aid rules for innovation, 
to increase funding possibilities as well as legal certainty. The ongoing review aims to reduce 
State aid gradually while refocusing it on activities that have the most sustainable impact on 
competitiveness,  jobs  and  growth.  In  particular,  the  Commission  intends  to  modify  the 
Community  Framework  for  State  Aid  for  R  &  D  to  better  reflect  the  Community’s 
priorities  such  as  promoting  cross-border  research  cooperation,  public-private  research 
partnerships,  dissemination  of  research  results  and  major  research  projects  of  common 
European  interest.  In  addition  the  Commission  intends  to  review  the  rules  for  State  aid  and 
risk capital. 

9 

“State aid action plan: Less and better targeted state aid: a roadmap for state aid reform 2005-2009” - 
http://europa.eu.int/comm/competition/state_aid/others/action_plan/saap_en.pdf. 

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The  Commission  will  also  encourage  eco-innovation  and  improvements  in  productivity 
through eco-efficiency in line with the Environmental Technology Action Plan, in particular 
when revising the Community guidelines for State aid on environment.  

1.3. 

Improved efficiency and use of intellectual property 

Most high-technology companies consider intellectual property (IP) to be their most valuable 
asset. Effective and efficient protection of IP is essential for research and innovation. Millions 
of euros can be lost overnight if a company fails to protect its IP. The EU therefore needs an 
affordable,  legally  secure  and  user-friendly  system  of  IP  protection  if  it  is  to  attract  high-
technology  companies.  The  establishment  of  the  Community  trademark  and  of  the 
Community design right were big steps in this direction.  

Unfortunately, a similar process does not yet exist for patents. Companies are still faced with 
far greater patenting costs in the EU than in the USA. This is largely due to high translation 
and maintenance costs and the cost of having to defend a European patent separately in the 
courts of each Member State, in the event of litigation, with the risk of conflicting decisions. 
Adopting the Community patent would go a long way to resolve these problems by creating a 
unitary patent court and lowering translation costs.  

But this is not enough. Users often fail to protect their intellectual property through ignorance 
of  current  possibilities.  Therefore,  the  Commission  will  strengthen  existing  information 
and  support  services,  such  as  the  IPR  Helpdesk,  and  encourage  better  cooperation 
amongst  relevant  national  agencies.  Community  co-financing  may  be  provided  for  joint 
projects  under  the  PRO  INNO  initiative,  and  for  policy  coordination  under  the  RTD  OMC-
Net initiative. 

The Commission will also launch a dialogue with industry and other stakeholders in 2006 to 
determine what more might usefully be done to provide the European industry with a sound 
IPR framework. 

1.4. 

An attractive single market for researchers 

To expand its role in science, technology and innovation, the EU needs to get more and better 
researchers  and  to  use  these  human  resources  fully.  It  should  stimulate  the  best  brains  to 
follow research careers and to stay in or come to Europe. A broad and integrated strategy to 
strengthen human resources in research in the EU has been developed and implemented with 
Member States in recent years. 

The ultimate aim is to create an open and competitive European labour market for researchers, 
enhancing diversification of competences and career paths at transnational level. Substantial 
progress has been made at national level on a number of measures to eliminate barriers to the 
mobility of researchers, to develop the skills and competences necessary for the evolution of 
their  careers  across  different  sectors  and  disciplines,  and  to  enhance  their  status  and  career 
development8.  However,  mobile  researchers  still  face  legal,  administrative  and  information 
problems, notably related to tax and social security, and other obstacles to inter-sectoral and 
transnational mobility. These have to be overcome.  

The Commission will support and monitor the implementation of its recommendations on a 
European  Charter  for  Researchers  and  on  a  Code  of  Conduct  for  the  Recruitment  of 
Researchers.  Once  adopted,  the  same  will  be  done  for  the  Directive  on  the  admission  and 

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residence of third-country-researchers for more than three months and for the corresponding 
Recommendation, which will anticipate the application of some provisions of the Directive. 
Member States are invited to implement the above Recommendation as well as the Council 
Recommendation  on  short-term  visas  for  third  country  researchers.  The  Commission  will 
continue to develop and implement, together with Member States, measures to overcome 
persistent obstacles  faced  by mobile  researchers.  The  Commission  will also foster public 
recognition of researchers and encourages Member States to do likewise. 

1.5. 

Using public procurement to foster research and innovation 

Business  investment  in  research  and  innovation  is  strongly  influenced  by  the  market,  in 
particular  the  level  of  performance  demanded  by  customers.  With  public  procurement 
accounting  for  16%  of  EU  GDP,  public  authorities  are  big  market  players.  Thus  they  have 
powerful  means  to  stimulate  private  investment  in  research  and  innovation.  This  could  be 
done  by  specifying  functional  requirements  in  a  way  that  leaves  firms  the  widest  scope  to 
propose  innovative  solutions.  This  would  give  firms  strong  incentives  to  maximise  the 
efficiency and performance of the products and services they offer, particularly where public 
authorities act as launching customers providing lead markets for new technologies. Markets 
where  public  authorities  have  a  strong  potential  to  stimulate  demand  for  new  technologies 
information  and 
include 
communications.  

transport,  energy,  environment,  health,  education  and 

To realise this potential, public procurement officials need political and managerial backing 
and  practical  support.  Policymakers  and  public  authorities  should  be  made  aware  of  the 
possibilities offered by the new public procurement legislative framework – in particular, the 
scope  for  encouraging  companies  to  increase  the  technological  and  innovative  content  of 
procured goods and services. New tools are needed to support the necessary changes. In the 
field of environment, this was done with a “Handbook on green public procurement” in 2004. 

The Commission will raise awareness of the benefits of re-orienting public procurement 
towards  stimulating  research  and  innovation  and  the  scope  for  this  under  Community 
public procurement law. This will take the form of a “Handbook on public procurement and 
research and innovation”.  

This  work,  which  will  fully  comply  with  the  public  procurement  directives10  and  State  aid 
rules  will  have  to  be  seen  in  the  broader  context  of  the  various  ways  in  which  public 
procurement  policy  can  contribute  to  the  delivery  of  the  Lisbon  partnership  for  growth  and 
jobs.  In  this  respect,  the  Commission  will  ensure  the  coherence  of  the  various  initiatives 
underway and reflect on how best to realise the significant contribution that the application of 
public procurement can bring to the attainment of our Lisbon goals. Mutual learning between 
Member  State  stakeholders  and  procurement  officials,  involving  the  exchange  of  good 
practice, could reinforce these efforts.  

1.6. 

Better and wider use of tax incentives  

Well-designed tax incentives can support business research and innovation in a simpler and 
more  predictable  way  than  grants,  but  at  the  cost  of  a  reduced  ability  to  target  specific 
research  and  innovation  objectives.  In  recent  years,  many  Member  States  have  introduced 

10 

EU directives 2004/17 and 2004/18. 

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new  tax  incentives  or  substantially  expanded  existing  ones  to  stimulate  business  research. 
They  now  form  a  substantial  part  of  the  total  public  effort  to  support  business  research  in 
several  Member  States.  However,  the  design  and  implementation  of  tax  incentives  vary 
greatly, resulting in a fragmented and unattractive fiscal landscape.  

Tax  incentives  are  essentially  the  responsibility  of  Member  States.  However,  their 
effectiveness and stability could be improved by identifying and disseminating good practice 
compliant  with  Community  law,  and  by  promoting  consistent  approaches  across  the  EU  to 
common  issues  such  as  cross-border  outsourcing  of  research,  expansion  of  young  research-
intensive  firms,  or  synchronisation  of  national  support  to  large  European  research  projects. 
Extending them to other forms of innovation such as design or process engineering can also 
be explored. It is of course imperative that all such schemes comply with Community law. 

In the design of tax incentives, attention should be given to SMEs, which often outsource their 
research  or  acquire  new  technologies  through  technology  transfer.  Young  innovative  SMEs 
also tend to have lower profits or even losses and so may not benefit from tax incentives as 
easily as larger companies. 

The  Commission  intends  to  adopt  a  Communication  to  bring  about  a  more  effective, 
stable and concerted use of R&D tax incentives across the EU. This will provide guidance 
on  designing  and  implementing  R&D  tax  incentives,  including  specific  schemes  addressing 
areas of common interest. 

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To put research and innovation at the heart of EU policies: 

The Commission will: 

Member States are invited to: 

Reference: 

Step  up  dialogue  with  stakeholders  to 
identify regulatory barriers to research 
and innovation 

Transpose  Community  legislation 
in a way that will promote research 
and innovation 

IG 7 and 14 

Adopt 
innovation-friendly State aid regime 

a  more 

research 

and 

Fully exploit the possibilities of the 
to 
new  framework  for  support 
research and innovation  

IG 7 and 13 

1.1 

1.2 

1.3 

Support actions on improving the IPR 
system and its effective use 

Adopt  the  Community  patent,  and 
the  current 
improve 
meanwhile 
system 

IG 8 

CLP action I.1 

1.4 

Support,  monitor  and  further  develop 
actions  under  the  research  human 
resources strategy 

Implement  the  Recommendations 
and  Directive  (when  adopted)  on 
research human resources and other 
means 

IG 7 

CLP action III.10 

1.5 

Promote the use of public procurement 
to stimulate research and innovation 

Consider  reviewing  procurement 
practices  through  mutual  learning 
and  use  the  possibilities  offered  by 
the new legislation  

IG 3 and 8 

1.6 

Provide  guidance 
optimal use of R&D tax incentives 

to  promote  an 

Implement on a voluntary basis the 
forthcoming  guidance  taking  into 
account national contexts 

IG 7 

CLP action III.9 

CHAPTER 2  RESEARCH AND INNOVATION AT THE HEART OF EU FUNDING  

Public support programmes are essential to “the excellence and attractiveness of the science 
base” as well as for the innovation performance of companies. Higher priority should be given 
to research and innovation in allocating public expenditure at all levels. In addition, better use 
should  be  made  of  the  various  public  support  mechanisms  to  leverage  private  investment: 
grants, equity instruments, guarantee schemes and other risk-sharing mechanisms.  

The  Commission  has  already  done  so  with  its  proposals  for  the  7th  Research  Framework 
Programme11 (FP7) and the Competitiveness and Innovation Framework Programme12 (CIP), 
the Structural Funds13, the Rural Development Fund and other relevant instruments. These are 
complementary instruments, each with its specific form of governance. Member States should 
also  do  more,  taking  into  account  their  specific  situations  and  learning  from  others’ 
experience.  

11 
12 
13 

COM(2005) 119. 
COM(2005) 121. 
COM(2005) 299. 

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2.1. 

Mobilising public and private resources for key technologies  

The  Council  and  the  European  Parliament  are  invited  to  adopt  the  Commission’s 
proposals  for  FP7  and  CIP,  which  would  provide  the  financial  means  and  instruments  to 
address the challenges of the new Lisbon partnership for growth and jobs. 

For  FP7,  the  Commission  proposes  to  keep  as  a  main  instrument  the  transnational 
collaborative projects, which typically associate public research and industry. In addition the 
Commission  proposes  new  approaches  which  will  further  increase  the  relevance  of  FP7  for 
industry.  In  particular  the  Commission  proposes  to  set  up  long-term  public-private 
partnerships,  called  “Joint  Technology  Initiatives”  in  areas  where  existing  schemes  are 
inadequate  in  view  of  the  scope  of  research  and  the  scale  of  material  and  human  resources 
required.  They  will  implement  parts  of  the  Strategic  Research  Agendas  defined  by  the 
European  Technology  Platforms  in  co-ordination  with  national  programmes  and  projects  in 
the  same  field.  They  will  aim  to  combine  financing  from  Community  and  national  public 
sources and from the private sector. EIB loans may contribute where appropriate.  

Another new instrument proposed under FP7 is the “Risk-Sharing Finance Facility”. It aims 
to improve access to EIB debt finance for participants in large European research actions such 
as new research infrastructures and large collaborative projects, including those of EUREKA. 
By  sharing  risk  with  the  EIB,  the  facility  will  allow  a  larger  volume  of  loans  for  research 
projects  and  the  financing  of  bankable  projects  with  a  higher  risk  than  would  otherwise  be 
possible for the EIB.  

The  Commission  proposals  for  FP7  also  aim  to  strengthen  the  research  and  innovation 
capacity of SMEs. The Commission has proposed doubling the funding available for specific 
actions to support outsourcing of research by SMEs or SME associations. SMEs’ participation 
in FP7 will be further enhanced by taking due account of their needs in defining the content of 
the  thematic  areas  and  by  further  simplifying  and  rationalising  administrative/financial 
procedures. In addition, the Commission will continue to promote the participation of SMEs 
in EU research programmes. 

In  the  field  of  information  and  communication  technologies  (ICT),  the  Commission  has 
launched  the  i2010  initiative14.  It  highlights  the  pervasive  role  of  ICT  as  key  enablers  of 
innovation.  For  instance,  fixed  and  wireless  broadband  communications  are  essential  for 
building  the  basic  infrastructure  for  innovation  and  the  knowledge  economy.  They  help 
generate  demand  for  new  applications and services and provide means for firms  to increase 
productivity through process innovation. CIP will support wider take-up and better use of ICT 
in both private and public sectors.  

Eco-innovation, including methods to boost energy efficiency, has great potential for creating 
competitive advantages for European enterprises. The CIP proposal includes support for pilot 
projects  and  market  replication  of  eco-innovative  technologies  to  help  deploy  them,  in  line 
with the Environmental Technologies Action Plan15.  

14 

15 

EN 

the 

European 

Information 

“i2010: 
http://europa/eu.int/information_society/eeurope/i2010/index_en.htm. 
“Stimulating Technologies for Sustainable Development: An Environmental Technologies: Action Plan 
for 
http://europa.eu.int/eur-
lex/en/com/cnc/2004/com2004_0038en01.pdf. 

COM(2005) 

COM(2004) 

European 

Society 

Union 

2010” 

229 

and 

and 

the 

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- 

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Further Community funding to fill the gaps between research and implementation is provided, 
for  instance,  by  the  Trans-European  network  budget  lines  that  support  industrial  projects  in 
the  fields  of  radio  navigation  systems  (GALILEO),  railways,  air  traffic  control  and  other 
intelligent transport systems applications.  

2.2. 

European Structural Funds to drive research and innovation 

Cohesion  policy,  supported  by  the  Structural  Funds,  increasingly  focuses  on  knowledge, 
research  and  innovation.  Where  regions,  Member  States  and  the  Commission  foster 
development within a bottom-up approach, based on partnership and shared management, it 
has proven to be a strong instrument resulting in increased growth and job creation. A strong 
effort  has  already  been  made  in  the  present  programming  period  (2000-2006);  spending  on 
research and innovation amounts to 7.4% of the total European Regional Development Fund 
for  less  developed  regions  (EUR  7.5  billion)  and  11%  for  regions  under  economic 
restructuring  (EUR  2.4  billion).  The  Commission  has  proposed  that  Member  States 
significantly increase expenditure in this area in the next programming period. Similar efforts 
are being made with the European Social Fund. 

This  approach  is  reflected  in  the  Commission’s  draft  Strategic  Guidelines  for  Cohesion 
Policy16,  which  expect  the  Structural  Funds  to  fully  back  the  implementation  of  the 
Partnership  for  Growth  and  Jobs.  A  broad  range  of  research  and  innovation  related  actions 
may  be  funded,  such  as  regional  and  transregional  clusters,  poles  of  excellence,  technology 
transfer, business support services and actions to develop human capital and to help workers 
and enterprises anticipate and adapt to economic change. Regions and Member States can use 
the  Structural  Funds  in  a  flexible  manner  to  help  meet  their  specific  needs  and  exploit  the 
synergies  with  FP7  and  CIP.  Innovative  actions  will  also  be  co-financed  by  European 
Agricultural  Fund  for  Rural  Development  to  develop  new  high  quality  and  value  added 
products  and  to  promote  the  sustainable  use  of  natural  resources.  The  Commission  will, 
through  the  strategic  guidelines  and  its  interactions  with  Member  States  and  regions, 
promote  the  use  of  Structural  Funds  and  Rural  Fund  to  improve  knowledge  and 
innovation for growth. 

Member  States  are  invited  to  take  full  advantage  of  the  Structural  Funds  and  the  European 
Agricultural  Fund  for  Rural  Development  to  strengthen  and  build  strong  research  and 
innovation systems. 

2.3. 

Improving SME access to finance 

Access  to  finance  remains  a  major  concern  for  businesses,  including  innovative  SMEs. 
Innovative  and  R&D-intensive  businesses  often  have  difficulties  in  obtaining  finance  in  the 
stages between demonstrating a new technology, process, product or service and exploiting it 
commercially.  Compared  with  its  main  competitors,  the  market  for  finances  for-innovative 
companies from the pre-seed to expansion stages in Europe is still underdeveloped.  

Better access to equity and quasi-equity for more mature innovative SMEs is also needed for 
‘follow-on’ investment to help businesses reach their full potential, bring their products and 
services  to  the  market,  and  continue  funding  their  research.  This  requires  incentives  to  take 

16 

The  Strategic  Guidelines  set  out  the  strategic  framework  for  the  new  operational  programmes  to  be 
supported by the European Regional Development Fund (ERDF), the European Social Fund (ESF) and 
the Cohesion Fund - COM(2005) 299. 

EN 

12 

   EN 

 
                                                 
more  risk  and  a  change  in  attitudes  among  financial  institutions,  private  investors  and 
business angels. Hence the Commission will further explore the different facets of financing 
growth and EU action in a communication in 2006.  

The Commission has put forward concrete proposals to improve SME access to finance 
through CIP. The proposed new High Growth and Innovative SME Facility will improve and 
strengthen  Community  mechanisms  to  share  risk  and  reward  with  private  equity  investors, 
providing significant leverage for the supply of equity to innovative companies. The proposed 
SME  Guarantee  Facility  will  improve  SME  access  to  equity  and  quasi-equity  (mezzanine 
finance)  by  sharing  the  risk  of  these  operations.  Specific  support  for  SMEs  active  in  eco-
innovation will be provided. These instruments will be managed by the European Investment 
Fund,  and  complement  the  European  Investment  Bank  Group  initiative  on  investment  in 
innovation17.  They  also  should  seek  synergy  with  the  measures  improving  SMEs  access  to 
finance – such as grants and loans – under Structural Funds. 

In  addition,  the  Commission  will  bring  together  stakeholders  to  identify  further  barriers  to 
obtaining finance and explore possible solutions. For example, currently SMEs cannot easily 
use  their  IPR  to  obtain  debt  financing,  which  forms  the  bulk  of  their  external  finance.  For 
high-tech and research intensive SMEs, especially, this presents a problem as they often have 
no  other  collateral  to  offer  to  financial  institutions,  IPR  being  their  main  asset.  The 
Commission  will  encourage  the  financial  community,  accounting  bodies  and  the  IP-
community to investigate the scope for valuation of IPR18.  

2.4. 

Mobilising  national  programmes  and  other  sources  of  funding  for  European 
research and innovation 

Community  funding  to  promote  innovation  and  research  activities  represents  only  a  small 
fraction  of  the  overall  European  public  effort19.  To  offset  the  lack  of  critical  mass,  national 
programmes  need  to  increase  their  efficiency  and  complementarity,  contributing  to  a  fully 
integrated  European  Research  and  Innovation  Area  and  consistently  mobilising  national 
funding in support of European research and innovation activities. The ERA-NET-initiative20 
has  shown  the  success  of  this  approach  as  it  opened  up  the  prospects  for  increased 
transnational cooperation. 

The  Commission  has  proposed  to  extend  and  reinforce  Community  instruments  to 
further  stimulate  transnational  cooperation  and  coordination  between  regional  and 
national  programmes  supporting  research  and  innovation.  These  will  provide  direct 
Community  support  to  develop  and  implement  joint  research  and  innovation  programmes 
between Member States. They consist of the ERA-NET Plus scheme, new EC Treaty Article 
169 initiatives under FP7, and the CIP Business Innovation Support Scheme, which will draw 
on the PRO INNO initiative to be started mid-2006. 

17 
18 
19 
20 

“Innovation 2010 initiative”: http://www.eib.eu.int/site/index.asp?designation=i2i. 
See also action on intellectual capital reporting in section 3.5. 
For instance FP6 represents 5% of public funded research in the EU. 
http://www.cordis.lu/coordination/era-net.htm 

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13 

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The  PRO  INNO  initiative  aims  to  foster  trans-national  cooperation  among  innovation 
agencies and programmes by: 

•  Creating  an  INNO  Learning  Platform  to  identify  and  further  assess  good  practice  in 

support of innovation through peer-reviews and impact assessments studies 

•  Supporting  the  creation  of  INNO-Nets  to  bring  together  regionl/national  innovation 

programme managers in view of facilitating trans-national cooperation 

•  Supporting  specific  trans-national  innovation  initiatives  and  public-private  partnerships 

through INNO-Actions 

A call for proposals will be launched in October 2005. 

Donations are an underdeveloped source of funds for research (especially basic research) in 
most EU countries other than the UK. The role of foundations and trusts in raising funds for 
research should, therefore, be  developed. This means tackling  a number of legal, regulatory 
and fiscal issues. Foundations also need to be more transparent and accountable to encourage 
donor confidence. The Commission  is  exploring  ways  and means to  develop  and exploit 
the potential of philanthropy as a source of funding for research. 

To put research and innovation at the heart of EU funding: 

The Commission will: 

Member States are invited to: 

Reference: 

2.1  Stimulate  the  use  of  Structural  Funds  for 

driving research and innovation  

Adopt  the  Commission’s  proposals  on  the 
Cohesion  and  Structural  Funds  and  take  full 
range  of  new 
the  wide 
advantage  of 
opportunities  offered  by  these  Funds  and  by 
the  Rural  Development  Fund, 
regarding 
research and innovation  

CLP action 
II.1 to 3 and 
III.1 and 2 

2.2  Promote  better  access  to  finance  for 

innovative SMEs  

Make  full  use  of  the  equity  and  guarantee 
schemes 
financial 
engage 
communities to facilitate access to finance 

their 

and 

2.3  Support 

the  development  of  new 
their  market 

technologies  and  foster 
uptake  

Adopt the Commission’s proposals on the 7th 
Research  Framework  Programme  and  the 
Competitiveness  and  Innovation  Framework 
Programme, 
the  European 
Parliament 

together  with 

2.4  Mobilise  national  and  regional  research 
and  innovation  programmes  and  other 
sources of funding 

Take  maximum  advantage  of  Community 
support  schemes 
transnational 
cooperation 

foster 

to 

IG 8 and 15 

CLP II.4 and 
5 

IG 8 

CLP II.4 

CHAPTER 3  RESEARCH AND INNOVATION AT THE HEART OF BUSINESS  

When  placed  at  the  heart  of  business,  research  and  innovation  become  motors  of  wealth 
generation  and  growth.  It  is  also  widely  observed  that  the  innovation  performance  of 
enterprises  is  reinforced  when  they  form  clusters  and  networks.  Public  policy  cannot  create 
clusters, but public funding can strengthen them. For the EU’s science base to strengthen its 

EN 

14 

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industrial  base,  cooperation  between  public  research  and 
considerably.  

industry  should 

improve 

Business  and  policy  stand  to  benefit  from  better  information  on  trends  in  private  research 
investment  and  innovation,  particularly  in  individual  sectors.  More  emphasis  is  needed  on 
sectoral  needs  in  formulating  research  and  innovation  policies,  together  with  improved 
business  support  services  to  foster  technology  take-up  and  entrepreneurial  innovation,  in 
particular  to  help  SMEs  overcome  their  specific  problems  and  participate  in  European 
networks. 

3.1. 

Intensified university-industry partnerships  

Sub-optimal  research  collaboration  and  knowledge  transfer  between  Public  Research 
Organisations (PROs), particularly universities, and industry are one of the weaknesses of the 
European  research  and  innovation  system.  While  a  number  of  Member  States  have  done 
valuable  work  in  this  area,  they  have  often  only  considered  the  national  perspective.  As  a 
result,  current  rules  and  practices  in  the  EU  are  fragmented,  especially  those  regarding 
ownership  of  publicly-funded  research  results  and  contractual  arrangements  between  PROs 
and industry.  

More  consistent  rules  and  practices  across  the  EU  would  foster  PRO-industry  links  and 
maximise their impact. This will help create a level playing field for cross-border university-
industry  research  partnerships,  and  thus  contribute  to  the  European  research  and  innovation 
area. 

To  this  end,  the  Commission  will  adopt  a  Communication  defining  EU  guidelines  to 
improve  research  collaboration  and  knowledge  transfer  between  PROs  and  industry 
which Member States and stakeholders will be encouraged to implement on a voluntary and 
flexible basis. These guidelines will build on existing good practice (by both Member States 
and stakeholders) such as the Responsible Partnering Initiative launched by several European 
industrial and academic associations21. 

The Commission will also propose action to reinforce the position of universities in European 
research and technology, including in terms of knowledge creation for and with the business 
community  and  knowledge  transfer  to  society.  The  “Industry-academia  partnerships  and 
pathways” mobility scheme under FP7 will increase knowledge sharing through joint research 
partnerships, supported by the recruitment of experienced researchers, staff secondments, etc. 
In the context of the new Framework for State aid for R&D, the Commission will clarify the 
issue of university-industry partnerships as regards State aid rules.  

3.2. 

Innovation poles and research-driven and industrial clusters  

The  EU  has  many  dynamic  industrial  clusters,  albeit  smaller  and  less  integrated  than  in  the 
USA.  Research  and  innovation  therefore  suffer  from  the  same  fragmentation  as  the  internal 
market.  To  make  them  as  attractive  as  possible  to  foreign  investors,  these  innovation  poles 
and clusters need to achieve critical mass. They cannot be built from scratch, but depend on a 
strong industrial base and good and trustful relations between science and industry. 

21 

EIRMA, EUA, Proton and EARTO, “Handbook on responsible partnering”, http://www.eirma.asso.fr. 

EN 

15 

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Networking  within  clusters  and  across  complementary  clusters  is  a  key  factor  for  their 
successful development. Training and research centres, financial institutions, innovation and 
intellectual property consultants, local and regional development agencies and other support 
organisations  are  all  key  players  in  maximising  firms’  creative  business  potential.  The  ever 
increasing  complexity  of  products  and  processes  and  the  need  to  integrate  services  such  as 
maintenance,  logistics  and  marketing  raise  problems,  even  for  the  most  successful  clusters. 
Cooperation between clusters can help to address them. 

The  Regions  of  Knowledge  initiative  will  support  trans-national  mutual  learning  and 
cooperation  between  research-driven  clusters,  bringing  together  regional  authorities  and 
development  agencies,  public  research  organisations, 
industry  and  other  relevant 
stakeholders. Main activities covered: 

•  Analysis, development and implementation of research agendas for regional clusters and 

cooperation between them 

•  "Mentoring" of regions with a less developed research profile by highly developed ones 

•  Actions  to  improve  the  integration  of  research  actors  and  institutions  in  regional 

economies 

Member  States  are  invited  to  develop  regional  and  national  policies  for  innovation  clusters 
and poles, using the support offered by the European Structural Funds. Several EU measures 
will encourage and support the efforts of Member States and regions. The Commission will 
provide them with a map analysing the strengths and strategies of existing clusters in the EU. 
The  Europe-INNOVA  initiative  will  provide  support  to  facilitate  networking  between 
industrial  clusters  with  a  view  to  intensifying  transnational  cooperation  and  learning  how 
others build and manage successful cluster initiatives. 

Finally,  under  FP7  increased  resources  are  proposed  for  continuing  the  Community’s 
“Regions  of  Knowledge”  initiative,  which  supports  the  definition  and  implementation  of 
policies for the development of research-driven clusters. 

3.3. 

Pro-active business support services to stimulate research and innovation  

SMEs  play  a  major  role  in  the  European  Union’s  business  economy,  accounting  for 
approximately  66%  of  private  employment  and  57%  of  value  added  in  EU-25.  However, 
many  face  size-related  problems,  in  particular  when  it  comes  to  innovation,  access  to 
information,  networking  and  partner-finding.  Public  authorities  should  address  the  relevant 
market  failures  by  facilitating  dissemination  of  technology  to  SMEs  and  strengthening  their 
capacity to develop, acquire, adapt and use new technologies.  

EU  innovation  policy  therefore  facilitates  transnational  technology  transfer  (TTT)  between 
firms and encourages them to bring innovations to market, in particular through the network 
of  Innovation  Relay  Centres22,  which  fill  a  market  gap  by  providing  a  regional  gateway  to 
European cooperation and combining grass-roots knowledge with Europe-wide expertise and 
contacts.  The  Commission  will  continue  to  support  the  Innovation  Relay  Centres 
Network,  encouraging  synergies  with  other  business  support  networks,  such  as  the 

22 

http://irc.cordis.lu/ 

EN 

16 

   EN 

 
                                                 
EuroInfo Centres, with a view to creating “one-stop shops” where possible and improving and 
extending the range, efficiency and quality of the services they provide. The Commission also 
encourages  the  creation  of  networks  strengthening  innovation  through  interregional  co-
operation  under  Structural  Funds.  These  improvements  will  focus  particularly  on  TTT 
activities  and  partner  finding  between  innovative  SMEs,  research  organisations  and  large 
companies. 

3.4. 

Innovation management and social change 

‘Innovation  management’  is  a  prerequisite  for  innovation  to  flourish  in  firms.  Many 
enterprises, especially SMEs, encounter difficulties in planning, implementing and marketing 
innovative products and in innovating in their production processes. Innovation cannot work 
without taking people into account. Therefore, in addition to the specific research skills and 
researcher  career  issues  addressed  under  the  strategy  in  Section  1.4,  further  education  and 
training is essential to keep Europe's human capital up to date with the skills and knowledge 
necessary for innovation. This includes entrepreneurial skills and the readiness to take risks.  

Enterprises  of  all  sizes  should  be  more  flexible  in  responding  to  rapid  changes  in  demand, 
adapt to new technologies, such as ICT and e-business, and be able to innovate constantly in 
order to remain competitive. To this end, innovative working practices are to be promoted and 
disseminated, as stressed in the European Employment Strategy. The Education and Training 
2010 Programme23 and the Integrated Action Programme in the field of Lifelong Learning24 
also play a part in facilitating structural and social change. 

Innovation requires investing in people and skills. Commitment to innovation and research is 
also a manifestation of corporate social responsibility25 (CSR). Voluntary initiatives which go 
beyond legal, contractual and other requirements can boost a firm’s competitiveness and spur 
social  and  environmental  innovations  which  combine  business  benefits  with  societal 
objectives.  The  Commission  will  encourage  such  innovative  CSR  practices  among 
European companies. 

To  promote  dissemination  of  good  innovation  management  practices,  the  Commission  will 
facilitate  the  development  of  new  self-assessment  tools  for  further  use  by  regional  and 
national  innovation  agencies  in  support  of  SMEs.  Furthermore  the  Commission  will 
encourage the creation of a new European Innovation Prize as a “prize of prizes” to raise 
the profile of successful European innovative entrepreneurs  

3.5. 

The potential of innovative services 

The service sector plays an important role in growth and new jobs. At present, innovation in 
services is mainly driven by new offerings that respond to customer demand. But increasingly 
services  are  also  driven  by  higher  research  investment  and  depend  on  the  adoption  of  new 
technology.  

23 

24 

25 

Communication  from  the  Commission  “Education  and  Training  2010:  The  Success  of  the  Lisbon 
Strategy Hinges on Urgent Reforms” - COM(2003) 685, 11.11.2003. 
http://europa.eu.int/comm/education/policies/2010/et_2010_en.html 
Proposal for a decision of the European Parliament and of the Council establishing an integrated action 
programme in the field of lifelong learning - COM(2004) 474, 14.7.2004. 
CSR is the voluntary integration, by enterprises, of social and environmental concerns in their business 
operations and in their relationship with stakeholders - COM(2002) 347. 

EN 

17 

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Recognising their increased importance for  the  European economy, by  the  end  of  2006 the 
Commission will define a strategy to promote innovative services in the EU, based on the 
work  and  policy  recommendations  of  the  European  Forum  on  business-related  services26. 
Innovation support mechanisms will be geared to the specific needs of services and specific 
efforts will be made to measure service-based innovations better.  

3.6. 

Establishing a  European Industrial Research and Innovation Monitoring System 
and improving intellectual capital reporting 

Even if the level of research investment of top European firms in many sectors is comparable 
to that of the US and Japan, the EU’s research deficit is largely due to underinvestment by the 
private sector, partly as a result of a different sector mix. The EU has a lower output than the 
US or Japan in some key research-intensive industries27. This and other factors – some sector-
specific – hold back the EU’s innovation performance and competitiveness.  

While  extensive  data  and  analysis  on  industrial  research  investment  and  innovation 
performance  are  available  in  the  Member  States,  data  availability  and  comparability  at 
company and sector level need to be improved in order to better understand the factors driving 
investment trends, identify upcoming challenges, and anticipate barriers to, and opportunities 
for, improving research and innovation investment.  

As outlined in the recent industrial policy Communication28, the Commission will establish 
a  European  Industrial  Research  and  Innovation  Monitoring  System.  This  builds  on  the 
coordinated  development  and  use  of  different  statistical  and  analytical  instruments.  To  this 
end, the Commission will expand its monitoring and analysis of private research investment 
by  supplementing  the  annual  European  industrial  research  investment  scoreboard,  notably 
with annual sectoral surveys of prospective trends. Furthermore, the system will build on the 
“Sectoral  Innovation  Watch”  on  performance  and  practice  that  monitors  and  benchmarks 
sectoral innovation patterns. This information system helps policy makers optimise research 
and innovation policies taking better account of sectoral needs and specificities and industrial 
sectors  and  firms  to  improve  competitiveness.  A  High-level  Stakeholders  Group,  involving 
industry and policy-makers, will provide guidance and feedback on the focus and relevance of 
this activity for competitiveness. 

Few  firms  systematically  take  stock  of  their  intellectual  capital,  the  value  created  through 
research  and  other  knowledge  resources.  This  under-recognition  of  intellectual  capital  can 
lead to a bias in financial markets towards traditional rather than research-intensive businesses 
and in the allocation of resources within companies. Although several methods of measuring 
and  reporting  intellectual  capital  have  been  developed,  especially  for  internal  management 
purposes,  take-up  in  companies  has  been  slow.  The  Commission  will  help  to  further 
promote their development and use, while improving the consistency of definitions and 
methods  across  the  EU.  This  should  take  into  account  the  views  of  stakeholders  and 
developments in accounting rules.  

To put research and innovation at the heart of business: 

26 
27 
28 

http://europa.eu.int/comm/internal_market/services/brs/forum_en.htm 
http://eu-iriscoreboard.jrc.es/ 
COM(2005) 474. 

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18 

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The Commission will: 

The Member States are invited to: 

Reference: 

3.1. 

Define EU guidelines to improve 
research collaboration and knowledge 
transfer between public research and 
industry 

Implement the guidelines taking into account 
the national contexts 

CLP III.10 

3.2. 

Promote innovation poles and 
knowledge-driven and industrial 
clusters 

Make full use of Structural Funds for the 
development of innovation poles and participate 
in EU cluster initiatives 

IG 8 and 10 

CLP III.1 

3.3. 

Provide specific business support 
services to enterprises, in particular 
SMEs, stimulating research and 
innovation 

Make full use of Structural Funds and IRC 
support for improving innovation support 
services, in particular for SMEs 

IG 8 and 15 

CLP III.1 

3.4. 

Promote  good  innovation  management 
practices 

Promote the use of new innovation 
management tools and consider innovation 
prizes 

IG 8 and 15 

3.5. 

Define and implement a strategy 
promoting innovative services 

Consider ways of promoting innovative 
services 

IG 8 

3.6. 

Expand monitoring and analysis of 
private research investment and sectoral 
innovation performance 

Take account of the results of the EU level 
monitoring and analysis 

ILS29 
chapter 6 

CHAPTER 4 

IMPROVED RESEARCH AND INNOVATION POLICIES  

The  EU  currently  displays  a  patchwork  of  national  and  regional  research  and  innovation 
systems  adapted  to  the  varying  local  situations.  Improving  their  efficiency  requires  more 
systematic  cooperation  among  Member  States  on  addressing  transnational  issues  and 
developing  synergies  between  their  research  and  innovation  systems.  Development  of 
coherent  and  mutually  supportive  policies  by  the  regions,  Member  States  and  European 
institutions is essential for strengthening the European Research and Innovation Area and for 
implementing  the  new  Lisbon  partnership  for  higher  and  sustainable  economic  growth  with 
more and better jobs. 

The Commission will provide the basis for robust economic and policy analysis and will put 
in place more efficient channels for policy makers to draw on each others’ experience and to 
enhance transnational coordination and cooperation.  

4.1. 

Research  and  innovation  as  a  priority  of  the  National  Reform  Programmes  for 
growth and jobs 

Research and innovation policies are one of the key areas of the revised Lisbon Strategy. The 
Council has adopted a new set of integrated guidelines30, which will guide Member States in 

29 

30 

“Working together for growth and jobs. Next steps in implementing the revised Lisbon Strategy” (ILS) 
- SEC(2005) 622. 
See  in  particular  guidelines  No  7  (increase  and  improve  investment  in  R&D,  in  particular  by  private 
business) and No 8 (facilitate all forms of innovation) in Council Recommendation 2005/601/EC of 12 

EN 

19 

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preparing  their  NRPs.  Member  States  will  report  annually  on  their  research  and  innovation 
challenges,  targets  and  policy  developments  and  on  progress  with  implementing  them.  The 
contribution of the operational programmes co-financed by the Cohesion and Structural Funds 
will be highlighted. 

For  many  Member  States  research  and  innovation  should  be  identified  as  key  challenges  in 
the  NRP.  Whenever  relevant,  the  Commission  will  analyse  the  NRP  from  the  angle  of 
research investment targets and research and innovation policy developments. Bilateral 
dialogues with Member States will help identify their possible strengths and weaknesses and 
suitable policy measures to improve conditions for research and innovation. 

4.2. 

Improved policy analysis instruments 

Developing appropriate policies to strengthen investment in research and innovation requires 
sound economic and policy analysis of the current situation. There is a need for information 
and analysis on the challenges faced, measures introduced, their implementation and impact, 
and the performance of the research and innovation systems. This can be achieved by using 
suitable indicators and benchmarking policies and good practice for particular contexts. This 
analysis should be progressively extended to the regional level.  

To  this  end,  the  Commission  will  further  develop  as  complementary  tools,  in  close 
cooperation  with  Member  States,  the  European  Trend  Chart  on  Innovation  and  the 
information  system  on  national  research  policies  (ERAWATCH).  This  will  include  the 
Innovation Scoreboard and the research key figures. These instruments will be key elements 
for monitoring the new Lisbon partnership for growth and jobs and will provide an inventory 
of  good  practices  that  can  be  widely  used  to  build  on  strengths  and  address  weaknesses  in 
national research and innovation systems. They will be linked to the future inter-institutional 
portal which will provide a single entry point to EU web resources on science, research and 
innovation. 

4.3. 

Support to policy learning and cooperation  

There  is  a  need  for  further  policy  learning  and  for  assessing  good  practices  in  support  of 
research  and  innovation  with  regard  to  their  transferability  and  methods  of  implementation, 
taking  into  account  regional  and  national  specificities.  The  Commission  will  continue  to 
provide  European  platforms  to  share  and  validate  good  practices,  bringing  together  the 
relevant  stakeholders  and  encouraging  peer  reviews.  Through  this  process,  the  Commission 
will  also  promote  a  common  approach  to  transnational  issues  and  a  more  systematic 
evaluation culture in the EU. 

Research policies are coordinated under the auspices of the European Union’s Scientific and 
Technical  Research  Committee  (CREST).  To  make  this  process  more  effective,  the 
Commission  will  invite  CREST  to  meet  at  Director-General  level  when  appropriate.  In 
addition, a pilot scheme  has been launched to support bottom-up  coordination  initiatives by 
several countries and regions in the field of research policy (RTD OMC-NET). This will be 
further developed in FP7. Effective liaison will be ensured with the Enterprise Policy Group, 
which will coordinate innovation policy issues. 

July 2005 on the broad guidelines for the economic policies of the Member States and the Community 
(2005 to 2008) - OJ L 205, 6.8.2005, p. 28. 

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RTD  OMC_NET  is  an  initiative  to  support,  through  calls  for  proposals,  initiatives 
undertaken by several countries and regions, involving where appropriate other stakeholders. 
Selected activities will: 

•  contribute  to  more  effective  national  policies  through  enhanced  mutual  learning,  peer 

review and identification of good practice 

•  identify issues with a strong trans-national dimension, which would benefit from concerted 
or joint action between Member States or mutually reinforcing action at national and EU 
levels 

•  prepare the ground for concerted action by interested Member States and for Community 

legislation or guidelines where appropriate 

To  further  facilitate  policy  learning  and  development  in  the  field  of  innovation,  the 
Commission will build on existing instruments for developing and benchmarking innovation 
strategies,  such  as  the  Regional  Innovation  Strategies  assisting  regions  to  foster  their 
innovation  systems.  This  will  be  supplemented  and  further  developed  by  the  forthcoming 
INNO  Learning  Platform,  which  will  focus  on  transnational  cooperation.  The  Commission 
will use existing interactive learning platforms on regional research and innovation under the 
umbrella  of  the  Innovating  Regions  in  Europe  platform,  bringing  together  regional  and 
national stakeholders and providing an inventory of good practices and case studies.  

To improve research and innovation governance in Europe: 

The Commission will: 

Member States are invited to: 

Reference: 

4.1 

4.2 

4.3 

Monitor and support national research 
and innovation policy developments 
through the new Lisbon partnership for 
growth and jobs 

Where appropriate, report on national research 
and innovation policy developments in NRP 
within the new Lisbon partnership for growth 
and jobs 

CLP ch. 2 

ILS ch. 3 
and 6 

Further develop policy analysis 
instruments for research and innovation 

Make full use of statistical and policy analysis 
provided by the Commission 

ILS ch. 6 

Support policy learning platforms and 
facilitate transnational policy 
cooperation 

Make full use of transnational policy learning 
and cooperation 

ILS ch. 4 
and 6 

CONCLUSION 

The  actions  outlined  in  this  Communication  will  ensure  maximum  effectiveness  in  research 
and innovation policies and is in line with the renewed Lisbon strategy’s emphasis on focus, 
partnership and streamlining. In particular, it gives substance to the priority of knowledge and 
innovation  for  growth,  by  providing  a  framework  for  developing  synergies  at  all  levels. 
Building on past achievements, all action, new and upgraded, needs to be pursued with vigour 
and determination if the aim of raising the EU’s research and innovation efforts to world-class 
intensity  and  effectiveness  is  to  be  achieved.  Where  appropriate,  the  Commission  will  also 
propose  initiatives  that  bring  together  research  and  innovation  policies  at  the  level  of  key 
strategic sectors. 

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The  NRP,  developed  within  the  new  Lisbon  partnership  for  growth  and  jobs,  should  fully 
embrace  research  and  innovation  challenges.  Focused  Community  financial  support  for 
research  and  innovation  activities  of  European  interest,  guidance  for  coordinated  policy 
development,  and  improved  platforms  for  mutual  learning,  in  all  areas  where  transnational 
cooperation  offers  strong  added  value,  will  support  the  NRP.  In  this  way,  a  truly  European 
Research and Innovation Area will develop, building upon the specific strengths of Member 
States and their regions. 

Further details of the actions described in this communication are set out in the accompanying 
document.  Where  appropriate,  the  actions  envisaged  in  this  document  and  its  annex  will  be 
continuously  updated,  taking  into  account  the  progress  made  on  increasing  and  improving 
research and innovation in Europe and the ongoing discussions on the Financial Perspective 
for 2007-2013. Moreover, the approach will be updated in the light of implementation of the 
Partnership for Growth and Jobs. 

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