Source: EURLEX
Language: en
Format: md

**COMMISSION OF THE EUROPEAN COMMUNITIES**

**Brussels, 16.05.1995**
COM(95) 190 final

COMMUNICATION FROM THE COMMISSION

**TO THE COUNCIL AND THE EUROPEAN PARLIAMENT**

PROSPECTS FOR COOPERATION

IN SCIENCE AND TECHNOLOGY

WITH THE NEW INDEPENDENT STATES (NIS)

**Prospects for** **Cooperation** **in Science and Technology**
**with the New Independent States (NIS)**

**CONTENTS:**

**SUMMARY** **1** **OL**

**1.** **Introduction** **1** **Sir**

**2.** **Objectives of the Community's** **cooperation** **with NIS** **1** **V**

**3.** **Stimulating nuclei of a new science culture** **2**
**3.1.** **Reduced number of projects with better support** **2**
**3.2.** **Integrating** **INTAS** **•** **2**
**3.3.** **Cooperation with TACIS and coordination with Member States** **3**
**3.4.** **Flexible project structure for infrastructure-building** **.** **3**
**3.5.** **Regional diversification** **3**
**3.6.** **Thematic** **priorities** **4**

**4.** **Improving project quality and application** **5**
**4.1.** **Support for project generation** **5**
**4.2.** **Application as one** **of** **the selection criteria** **5**
**4.3.** **Conversion** **and international technological cooperation** **6**

**5.** **Encouraging a more resourceful S&T environment** **6**
**5.1** **Improvement of information** **6**
**5.2.** **Partner-finding initiatives** **7**
**5.3.** **A Monitoring Network** **7**
**5.4. Legal conditions** **7**
**5.5. Payment transfer** **8**

**6.** **Conditions for** **Foreign** **Direct Investment** **(FDI)** **8**

**7.** **Operational conclusions: steps and instruments** **8**

**ANNEX I** **CURRENT** **COOPERATION** **AND THE PRESENT SITUATION OF** **S&T** **IN** **NIS**

**ANNEX** **n** **INTEGRATING** **INTAS**

**PROSPECTS FOR COOPERATION IN SCIENCE AND TECHNOLOGY**

**WITH THE NEW INDEPENDENT STATES (NIS)**

**SUMMARY**

**The** **EU** **intends to intensify its efforts** **on** **International Cooperation** **in S&T with the** **NIS**
**for mutual benefit and with objectives generated by the spirit of the Agreements on**
**Partnership and Cooperation.**

**After six** **years** **of economic** **decline,** **the** **RTD** **sector** **as** **a long-term pacemaker for social**
**and economic development must be encouraged to re-emerge with a more efficient**
**structure** **and** **faster** **than the** **general transformation** **process has** **allowed** **until** **now.** **S&T**
**cooperation with the NIS will therefore aim**

**- to reorient scientists towards research on private and public needs**

**- to replace outdated structures and promote rationalization**

**- to cultivate the industrial prospects and assure sustainable development**

**- to identify partners for cooperation on the newly emerging markets and**

**-**
**to support conversion of science towards civil purposes.**

**The immediate action in the first phase aimed at giving support to a wide range of**
**researchers in relatively small** **projects.** **They** **remained,** **in general, academic.** **The** **funds**
**available for this area under the 4th Framework Programme (FP) have been cut in half**
**since 1994. The remaining resources will have to be more and better focused. Priority**
**will be given to** **research.** **projects** **which indicate that they will lead to results in**
**industry or in the public domain in the near future.** **In** **order to enhance the application**
**and quality of projects, more active support will be provided but for fewer and more**
**relevant projects, with a view to creating nuclei of a renewed** **RTD** **culture. Following**
**the completion of the pilot phase of** **INTAS,** **a** **new approach will be developed. Despite**
**the reduced resources, the EU will spend a limited share on excellent fundamental**
**research.**

**To improve project quality, a variety of support measures are envisaged, allocating to**
**them a higher share of the funds in the future:**

*** improvement of the general information and partner** **finding** **system,**

*** strengthening of the preparatory phase of** **projects,**
***** **defining** **project selection criteria more precisely, and**

*** measures contributing to the stabilization of the legal, economic and policy**
**conditions for RTD**

**Further activities and priority-setting will be** **based** **on a dialogue with the NIS, and on**
**a Technology Assessment and Monitoring Network.**

**Furthermore, coherence and the active cooperation of TACIS and of** **the** **Member States**
**will be sought.**

**d** **Q-**

**PROSPECTS FOR COOPERATION IN SCIENCE AND TECHNOLOGY**

**WITH THE NEW INDEPENDENT STATES (NIS)**

**1.** **Introduction**

**International cooperation in S&T with the NIS of the former Soviet Union (fSU) is**
**taking place in a demanding environment as the transformation of the science sector is**
**embedded in the overall process of political reform. The process of economic reform and**
**democratization has proved** **quite** **difficult and the future development remains**
**unforeseeable. Massive social problems have emerged and recently military conflict has**
**occurred.**

**The exposure of the formerly protected economy to global market forces has led to the**
**collapse of uncompetitive industries and consequently, to a continuous contraction of**
**the GDP, for six years running. With doubts about the present legal situation as well**
**as the political future, Western industries remain hesitant to pursue further investment**
**(see 6.). At present, there are only a few sectoral signs of recovery while major parts**
**of society suffer economic and social decline. Under these conditions, the RTD sector**
**must find its function as a new pacemaker for economic and social development.**

**After the first experiences of R&D cooperation with the NIS, it seems appropriate to**
**rethink the goals and initiatives and strive for better coordination of the available**
**means. The objective of the Communication is to launch a debate on these aims, in**
**particular with the Council and the EP.**

**2.** **Objectives of the Community's cooperation with NIS**

**It is the task of the individual NIS** **Governments** **to conduct the complex process of**
**transformation. However, through international cooperation, the EU can make a**
**significant contribution to this process. Following the Partnership and Cooperation**
**Agreements (PCA), see Annex I, 1), cooperation activities undertaken in the region**
**should contribute to stability and promote the process of peaceful integration into the**
**global economy after the previous isolation. Any activity promoted will have to serve**
**the mutual interest of the EU and the NIS. The financial support granted by the**
**Community on S&T cooperation projects, may not have an incidence incompatible with**
**the applicable rules of competition.**

**At present the RTD sector is still severely inhibited by** **the** **structures of the past and the**
**major cuts in S&T resources (for an analysis of the present situation, see Annex I). The**
**precarious economic conditions require much faster reform than the general**
**transformation process has allowed until now. RTD must re-emerge with a flexible and**
**more efficient structure, which can be sustained out of the** **NIS's** **own economic**
**resources. EU international cooperation in S&T, should therefore aim:**

**- to reorient scientists towards research on subjects corresponding to private and**
**public needs**

**- to replace outdated structures and promote rationalization**

**- to cultivate the industrial prospects and assure a sustainable development**

**-**
**to identify partners for cooperation on the newly emerging markets and**

**- to support conversion of science towards civil purposes.**

#### **li-**

**Main instrument of the EU to support and encourage the process** **of** **reform is the**
**Technical Assistance Programme for the CIS (TACIS) with an annual budget of**
**approximately 500 MECU. But also in S&T a wide array of different actions and**
**programmes were set up to support the process. In particular the 4th RTD FP includes**
**in its international cooperation (INCO) programme provisions dedicated to cooperation**
**activities. The areas mentioned in the INCO** **workprogramme** **are: environmental**
**protection and preservation of natural balances, health, advanced communications and**
**telematics, information technologies, materials and production technologies,**
**biotechnology, and transport. Furthermore, the** **possibility** **of a project by** **project**
**participation in other specific programmes is provided ( for more details on different**
**EU actions see Annex** **1.1** **and 2, and for a more detailed overview on achievements see**
**COM (94)420 final).**

**The average annually available funds in the 4th RTD FP for "cooperation with the**
**Countries of Central and Eastern Europe and the New Independent States of** **fSU"** **(a**
**total of 248.5 MECU for the period 1995-1998), however, have been reduced and**
**amount to** **half,** **compared to the 120.1 MECU allocated for one year in 1994.**

**3.** **Stimulating nuclei of a new RTD culture**

**The general identification of priorities in the transformation of S&T in the NIS has**
**remained controversial despite many individual and spontaneous efforts of different**
**national and international bodies** **[1]** **. In the first phase the European Community**
**considered important that the international cooperation contributes to keep up**
**enthusiasm for science and to mobilize researchers to get acquainted with competitive**
**procedures. As a result available resources were split between many** **small,** **projects.**
**International support often bypassed existing structures. The** **beneficiaries** **were**
**individual scientists in non-formalized cooperation frameworks.** **The** **strategy of the EU**
**was not to interfere with research institutions and yet to give a wide chance for**
**adaptation of scientists who were eager and competent. A first broad selection process**
**of internationally funded projects was initiated. During this phase S&T cooperation**
**remained essentially academic and showed little industrial involvement.**

**Based on the past experience and given the continuing urgency of the economic**
**situation, the next phase should bolster up the process of transformation and contain**
**more relevant structure building effects. NIS governments, in principle, are aiming for**
**such transitions, even though social hardship often impedes implementation politically.**
**International support should therefore use resources to encourage new tendencies and**
**set examples of promising scientific performance. The** **EU** **as the most important trading**
**partner has the a common responsibility to the NIS neighbours. In the following the**
**Commission launches some ideas on how to implement a second phase of S&T**
**international cooperation with NIS.**

**3.1.** **Reduced number of projects with better support**
**The new strategy should promote the creation of nuclei of a revitalised RTD culture.**
**Resources should be concentrated on fewer and more relevant projects. Not only the**
**selected projects themselves but also their environment should indicate a responsiveness**

OECD estimates that 'no less than 40 000 groups of experts' are supposed to contribute to setting S&T
priorities and evaluating institutes, see: OECD, Science, Technology and Innovation Policies, Federation of Russia,
Volume I, Paris 1994, p.36

to the general process of transformation. To improve project quality in terms of
achieving better application, active support will be needed. A variety of support
measures are envisaged:

   - **improvement of the general** **information** **and partner** **finding** **system,**

*** strengthening of** **the** **preparatory phase of** **projects,**

*** defining project selection criteria more precisely, and**
***** **measures contributing to the stabilization of the legal, economic and policy**
**conditions for** **RTD**

3.2. Integrating: INTAS (summary of Annex II)
INTAS was set up for a pilot phase in order to provide urgently a flexible, efficient tool
capable of attracting resources in addition to those provided by the Community **and to**
ensure formal participation of the Member States in an action conducted outside the FP.
It took the form of a private Association under Belgian law. The pilot phase has been
extended until 31 December 1995. The current members are the Member States of the
European Union, Norway, Switzerland and the Community itself.

INTAS in its current form has failed to attain the objectives set when it was set up.
Independent audits have shown that it takes particularly long to conclude contracts,
that the costs of this structure are high and that the procedure for evaluation of projects
submitted to INTAS is not always transparent. Moreover, the unpredictability of **the**
changes in Eastern Europe made it impossible to include this action in the **3rd** FP,
although this problem has been overcome in the 4th FP.

In the light of the foregoing, the Commission considers that the cooperation with the
NIS in the field of science and technology must continue but must be targeted more
closely on the real priorities. The preparatory action outside the FP has shown that
conditions were not met for the.creation of a separate structure (art,130n of the EC
Treaty). To make this action more effective, it will therefore be continued but brought
within the normal regulatory framework for implementation of the research
programmes, while retaining the specific features of INTAS described in detail in Annex
II.

3.3. Cooperation with TACIS and coordination with Member States
In order to make best use of the seriously reduced funds the R&D activities should seek
coherence with and the active cooperation of TACIS. General support activities such as
setting up information systems, giving assistance in the preparatory phase of projects,
legal and managerial advice within a more systematic structure, should be closely linked
to activities undertaken by TACIS. S&T cooperation in turn should **respond to and**
support TACIS projects.

There is an information deficit concerning the various activities Member States **are**
conducting individually in the area of S&T cooperation with NIS. To improve the
mutual knowledge in order to increase synergy and coordination, the Commission has
already started to launch studies on the actions initiated by the individual Member
States [2] . These types of studies will be continued and extended, making use of the rich
material which also exists within other organizations such as the OECD, World Bank,
UNCTAD and GATT/WTO.

2 European Commission, Science .Research, Development: Cooperation in Science and Research with Central
and Eastern Europe, Brussels 1994

**3.4.** **Flexible project structure for infrastructure building**
**No direct institutional support will be provided** **from** **S&T** **cooperation funds. The task**
**to overcome the lack of infrastructure and the necessity to build up or renew the long-**
**term structures is the task of the NIS governments. The international cooperation in**
**S&T** **will support their endeavour by project funding.** **TACIS,** **as the technical assistance**
**programme could also be able to support these ventures by institutional support. In**
**principle, the present political and legal situation gives preference to project funding.**
**Work has to be devoted to find better and more sustainable legal solutions for the**
**investment in scientific infrastructure.**

**3.5.** **Regional diversification**
**Decentralization and** **regionalizatioh** **of** **RTD** **capacity must be strengthened.** **In** **general,**
**regions with high** **S&T** **density have better chances to renovate their science structure**
**through their own potential. Peripheral** **research** **centres without further connections** **are**
**more at** **risk** **of collapse but they** **are** **also crucial for local development. Governed** **by** **the**
**overall selection criterion of excellence, regional relevance must be given particular**
**attention.**

**A major problem are the former isolated** **'science** **cities', urban mono-structures**
**supported by the central administration, mainly the Ministry of Defence. It must be**
**borne in mind that military research will continue in many of these cities and their**
**transformation into normal cities is not an explicit objective of the governments**
**concerned. The** **ISTC** **is active in the field of conversion by supporting civil projects**
**within former science cities. The general idea to transform those 'secret cities' which**
**have been opened into 'Technopoles' is regarded with some scepticism. Possibly the**
**market structures in the NIS are too weak to provide a self-sustained foundation. A**
**more appropriate attempt for** **the** **transformation into** **"normal"** **towns might be through**
**the general** **diversification^of** **the occupational structure. The response to regional**
**market needs may turn out to create better** **chances** **than a technology-led top-down**
**transformation.**

**3.6.** **Thematic priorities**
**General priorities for** **RTD** **cooperation have been identified in the past. In particular,**
**research projects in the** **field** **of** **the** **environment are of interest, e.g. for regions such as**
**the Black Sea, the Lake Aral, the Baikal etc. Cooperation in Chernobyl and other areas**
**on the effects of nuclear contamination and on nuclear safety will continue. The NIS**
**may also contribute important results for global change research, because of access to**
**the Arctic climate zone, of the availability of** **space** **technology and also because of the**
**vast territorial extension.**

**The section dealing with NIS in the work programme of the Specific Programme on**
**'Cooperation** **with** **third** **Countries and international** **organizations'** **gives** **an** **overview of**
**the most important areas for** **RTD** **cooperation. The interest in these areas is due to the**
**particular attention** **paid by the EU** **to cooperation** **on those subjects** **where** **the NIS** **need**
**to build infrastructure, to modernize their** **industries,** **to improve the low standard of**
**living or to** **tackle** **other major problems of** **NIS** **societies. Subjects are based on mutual**
**interest and they** **bear a** **promising potential for development.** **They partly** **refer to other**
**policies, in particular to the development of the global information society,** **and** **to**
**transport, industrial technologies and in the sector of energy generation, to processing**
**and transportation.**

**Nuclear technology and space technology were the most advanced and prestigious**
**technology complexes in the past.** **Both were** **related to** **military purposes and both** **have**

**the potential for peaceful applications. Their position in the future society, however,**
**and in particular their economic base and environmental sustainability have to be**
**carefully considered. The investments in the past were immense but the installations are**
**rapidly deteriorating. Without a long-term vision for future use and financial backing**
**both complexes will face a problematic future. This may result in a loss for space**
**technology and for the world's RTD community in general. For the nuclear sector this**
**may lead to an unsafe development.**

**Economics, financial studies, social sciences, market-oriented legal** **research,** **business**
**and administration are subjects which were** **lacking** **in former times or which were**
**rather weak. Whereas economic and financial studies as well as training are offered by**
**TACIS/ACE,** **the World Bank and many private universities, there is still a lack of social**
**sciences.** **In** **particular capacity to monitor the development and to give realistic**
**feedback on the direction of the development (Technology Assessment) are necessary.**
**A Monitoring Network (5.3.) could help to establish these functions.**

**4.** **Improving project quality and application**

**Under the present conditions projects of relevance are those which lead either to an**
**industrial application or to the creation of realistic problem-solving capacity in the near**
**future.**

**From the point of view of EU industries, it appeared difficult to identify high tech**
**products with a market potential and it was found even more difficult to apply Western**
**production systems to them** **[3]** **. Better preparation of industrial RTD projects will**
**contribute more for the future than extensive funding of non-targeted projects. It is,**
**necessary to better select and prepare projects for future industrial application.**

**Application of research results should also be considered when targeting** **research**
**proposals in the public domain. The reduced resources will influence the selection of**
**proposals for EU funding on the basis of their usefulness to improve the situation.**

**4.1.** **Support for project generation**
**Open calls for proposals as they are used in RTD specific programmes might not always**
**be the most appropriate means for generating good proposals. A closer 'dialogue with**
**the authorities of the NIS', with experts from NIS and** **the** **Member States should be**
**developed as a useful tool, in the way that the 'Round Tables on industrial co-operation'**
**function. The task of this 'dialogue with NIS authorities' should be to identify and**
**negotiate relevant choices for industrial projects or for projects in the public domain.**

**The preparatory phase of projects, in general, must be improved. Joint workshops in**
**selected areas should be used to create networks whenever the level of the envisaged**
**projects still seems too academic. COST projects should be opened to NIS for better**
**cooperation in networks. Out of these networks future projects may be generated. A**
**share of the budget in the forthcoming initiatives will include funds for workshops and**
**networks** **which serve in particular the preparation of applied projects.**

**4.2.** **Application as one of the selection criteria**
**In order to select industrial research projects with a realistic chance of application, more**
**targeted selection criteria should be introduced besides the usual criteria of excellence.**

3 IRDAC opinion on Scientific & Technological Cooperation with Central Eastern Europe

**In the present situation those projects which are close to industrial production should**
**be favoured. Project partners, therefore, should give evidence that the proposed project**
**is relevant and has an industrial partner in the consortium.**

**Moreover, proposals for cooperative research projects in general will have to include a**
**feasibility assessment. It should be carried out by the proposing partners as a**
**precondition for submission of a proposal. It will describe the foreseen application and**
**it must include a cooperation partner committed to using the results of the project. The**
**partner committed to application of the results of projects in the public domain may be,**
**e.g., an agency, such as an environmental organization, or a regional administration.**
**For** **industrial projects this might be newly established SMEs in** **NIS,** **or an interested EU**
**firm.**

**4.3.** **Conversion and international technology cooperation**
**Advanced technologies from the former mdustrial-military complex will have to be**
**transferred for new civil production applications. However, the NIS markets seem not**
**yet prepared for high standard products made in NIS. The condition that an industrial**
**partner committed to application of the results must be found may** **prove** **difficult at**
**present in the NIS. Conversion under these conditions becomes extremely difficult.**

**The** **ISTC** **is giving scientists the chance to work on such projects.** **ISTC** **projects are**
**funded by the United States, the EU (via TACIS)** **[4]** **and Japan. Scientists and engineers**
**are supported to work on nuclear reactor safety, management of radioactive waste,**
**aerospace, development of new materials, vaccines and other medical technologies, and**
**tools addressing a variety of environmental problems. The projects launched in the first**
**year of operation of the ISTC sponsor more than 8200 scientists and engineers who**
**previously worked in weapons mass destruction and missile technologies. The question**
**is how to make parts of these projects yield results with practical applications in**
**industry and in the public domain, while continuing also the support of fundamental**
**research**

**For the conversion of some of the military high-tech research capacities it may be more**
**promising to cooperate with EU firms to develop technical equipment for Western**
**production and for the EU markets than to start civil** **production** **for the Russian market.**
**The general concept of setting** **up** **joint** **RTD** **ventures on the basis of using NIS research**
**facilities to design products for EU markets, has to be carefully investigated. In the**
**present situation this type of cooperation may create the most benefits for both sides.**
**It can help qualified laboratories and institutes to adapt to R&D under market**
**conditions. The cautious attitude of military research centres to enter into such**
**cooperation with Western firms for non-military purposes (e.g. laser technology in**
**medical equipments) would have to be overcome. Legal implications have to be**
**examined and intellectual property rights need to be safeguarded.**

**The path to conversion with western firms and their actual industrial application may**
**be long. Nevertheless, open cooperation with EU partners would make a major**
**contribution to this process. ' The dialogue with the NIS authorities', preparatory**
**workshops and networks to develop a common strategy and feasibility assessments**
**should prepare the difficult task.**

4 Finland and Sweden contributed individually

**5.** **Encouraging a more resourceful S&T environment**

**Not only the projects themselves need better preparation. Constructive support is**
**needed for the entire environment in which useful and stable projects could be created.**
**Single elements can be contributed through TACIS or certain accompanying measures**
**within INCO. The lack of general infrastructure must be tackled by the national**
**authorities.**

**5.1** **Improvement of information**
**A major difficulty is the lack of access to information on science and the state of the art**
**in technological development. This involves the information on the overall system of**
**monitoring developments as well as the practical partner-finding systems. Apart from**
**economic statistics and** **indicators** **there is no appropriate system and the** **information**
**available has not yet reached a useful level. The patchy information on the situation**
**creates** **major problems. Information on the central cities such as Moscow and St.**
**Petersburg has been built up in the past years of cooperation. Information is also**
**available on regions such as Novosibirsk, Jekaterinenburg, Rostov and on model**
**developments like Nizhni Novgorod. However, on other regions of Russia and on the**
**other NIS, information is rather superficial.**

**Many attempts to evaluate and to assess the existing capacities have been undertaken**
**by different organizations and consultants.** **A** **useful overview on the situation,** **however,**
**a** **register** **or data bank of existing institutions and their current capacities and their**
**potential is not available at present and should be developed. Also scientific**
**communication networks should be encouraged to serve the improvement of**
**information systems.**

**5.2.** **Partner-finding initiatives**
**Improved information services are vital for research centres whose former links suffer**
**from the break-up of the** **fSU.** **Finding partners for the joint research proposals is**
**already difficult under more transparent conditions. Partner search, however, within an**
**underdeveloped information system diminishes even further the general chances of**
**success for cooperation. Additional support must be given to help potential partners in**
**the NIS, in the EU Member States, associated States and also in CEE countries to find**
**suitable collaborators. Not the quantity of research network achieved but the quality**
**should count. Model instruments for the improvement of** **RTD** **cooperation exist in the**
**EU: the (former Value) Relay Centres. Similar instruments built up together with a**
**technology assessment and Monitoring Network for the** **NIS** **will increase project quality**
**and contribute to long-term infrastructure.**

**In addition, topic-oriented 'brokerage events' involving interested industries and other**
**organizations could be organized in coordination with TACIS and Member States'**
**activities.**

**5.3.** **A Monitoring Network**
**The further development of priorities for the type of action and orientation will be**
**accompanied by a 'dialogue with the NIS authorities'. Locally existing information will**
**be made more accessible, coordinated and exploited. Information must be linked to**
**evaluation and monitoring studies. In the long run a Monitoring Network on a regional**
**basis should be encouraged to communicate across the different NIS. The focal points**
**of the network will continuously work on the improvement of information (data bases),**

**on the evaluation of the changes and monitoring of the RTD cooperation projects and**
**their local effects. At the same time they will serve for better information dissemination**
**and coordination between the regions and the NIS.**

**5.4. Legal conditions**
**Legal conditions are a major constraint. Industrial property rights, physical ownership**
**as well as intellectual property rights (patents) are causing problems in cooperation.**
**The RF established a new Patent Law modeled on the European Patent Organization**
**(APE).** **However, without an active enforcement and appropriate control mechanisms,**
**private-sector involvement in joint research projects** **will** **remain limited. Partners in**
**international cooperation need general security about commitments, duties and risks.**
**Initiatives require a stable legal background to refer to in cases of dispute. Legal**
**treatment in the NIS, in many respects, is unpredictable. A joint task force or working**
**party could support the advancement on legal conditions.**

**5.5. Payment transfer**
**Uncertainty relates also to taxation of payment transfers. The ISTC has achieved tax**
**exemption. Attempts to achieve the same for INTAS are under way. The taxation**
**appears to be higher if institutions are involved. This leads to attempts to bypass official**
**institutions and to grant research funds to single scientists. The possibilities of the**
**banking system must be included in the reflections. Joint talks and a** **working** **group**
**together with the representatives of governmental or non-governmental organizations**
**should address these financial problems.**

**6.** **Conditions for Foreign Direct Investment** **(FDI)**

**The general legal uncertainty is still the main hindrance to increased industrial**
**investment from the West. Research and industrial development are closely linked. The**
**structural change needed in the science sector is connected to the interest of private**
**investors to cooperate with NIS industries and their** **research** **centres and design offices.**
**Industry in the NIS must still get closer to the market needs. Cooperation programmes**
**in science and technology can only prepare the ground. S&T can give stimulation, but**
**without foreign investment to** **follow** **no constant innovation process will be initiated**
**with long-term prospects and with a sustainable economic impact.**

**The real economic changes are expected when more foreign investment enters the**
**countries. In principle EU-based enterprises are interested, and more investment could**
**be possible. With an unclear legal** **situation** **and concerns about the general political**
**future the level of investment at present still stays comparatively low, despite the**
**attractive conditions of high technological know-how, a huge market and low wages.**

**7.** **Operational conclusion: steps and instruments**

**The new orientation of international RTD cooperation with NIS, should concentrate on**
**the following elements:**

**1.** **Fewer and more relevant projects closer to application**

**2.** **Integrating INTAS**

**8**

**3.** **Preparation of actions, projects and finding possible partners through 'dialogue**
**with NIS authorities' and project preparation by funding networks**

**4.** **New requirement for proposal submission: to deliver a feasibility assessment and**
**submit together with a partner committed to application of the results**

**5.** **Cooperation and coherence with** **TACIS** **and other** **EU** **programmes; coordination**
**with Member State actions, with EBRD and with Worldbank**

**6.** **In general: higher** **share** **of the funds for supporting measures to** **improve** **quality**
**and application of** **projects:**

***** **Databank on relevant research institutions, their scientific profile,**
**evaluation results, ongoing projects etc.**

***** **Encouraging the development of a decentralized NIS Monitoring**
**Network**

***** **Partner-finding events, information days etc. with interested**
**industries**

***** **measures contributing towards the** **improvement** **of legal and**
**economic conditions for RDT**

**ANNEX I**

**CURRENT COOPERATION AND PRESENT SITUATION OF S&T IN NIS**

**CONTENTS**

**1.** **Framework of** **EU** **cooperation with NIS** **.** **/JO**

**2.** **Evolution of** **S&T** **cooperation with NIS** **1 /)**

**3.** **Present conditions in the aftermath of the SU in S&T** **/) 1**
**3.1.** **Heritage of the Past** **4^,**
**3.2.** **Size and Volume** **of.** **the Science Sector** **-13**
**3.3.** **Understanding Brain Drain** _**S[**_ **£**
**3.4.** **New territorial arrangement of the S&T Sector in the NIS** **4** **if**
**3.5.** **Emerging diversity of regional cooperation** _**J[i±**_

**1.** **Framework of** **EU** **cooperation with NIS**

**Considering the need for stability and the substantial economic opportunities in the**
**future, it is in the EU's interest to develop trade and investment** **relations** **throughout**
**the region within a legal** **framework.** **The Commission recently signed 'Agreements on**
**Cooperation and Partnership' (ACP) with the RF, Ukraine, Kazakhstan and Kyrgystan.**
**With all other countries except Tajikistan ACPs are being negotiated or exploratory**
**discussions are under way.**

**The broadly formulated** **ACPs** **contains** **a** **specific article on** **RTD** **cooperation. Stating the**
**aim** **of** **access** **to their respective** **RTD** **programmes, the three main areas of cooperation**
**mentioned are: the exchange of scientific and technical information, joint RTD**
**initiatives, training activities and mobility. In mutual interest, the objective is to give**
**special** **attention** **to redeploying scientists** **and** **researchers involved with mass**
**destruction weapons. Negotiations are foreseen to establish** **provisions** **for intellectual**
**property rights.**

**l o**

**The 4th** **RTD** **FP offers cooperation in** **S&T** **for NIS in Action 2: 'Cooperation with Third**
**Countries and International Organisation', part** **A2:** **'Cooperation** **with the Countries of**
**Central and Eastern Europe and the New Independent States of** **fSU'.** **Moreover both the**
**4th** **RTD** **FP and the EURATOM** **FP** **provide for participation of** **NIS** **partners on a project**
**by project basis in other Specific Programmes. In this respect, a distinction is to be**
**drawn between partners from two groups of NIS:**

*** from European NIS eligible to participate in all Specific Programmes of the FP**
**by virtue of Article 130j of the EC Treaty and**

*** from non-European NIS to participate in those Specific Programmes opened by**
**virtue of an ad hoc provision of the Specific Programme decision.**

**TACIS, the technical assistance programme for NIS launched in 1991 with an annual**
**budget of 500 MECU, provides know-how and technical equipment for a wide range of**
**public and private organizations. TACIS allocated 20 MECU for the International**
**Science and Technology Centre Moscow (ISTC) which was set up as an international**
**organization together with Russia, the US and Japan. Its objective is to employ**
**researchers from the military sector in civil projects. TACIS also funds** **ACE,** **the Action**
**for Cooperation in the field of Economics, and supports action concerning the**
**application of science and technology to the market economy, as well as the retraining**
**of scientists, teaching, education and professional attachment.**

**2.** **Evolution of S&T cooperation with NIS**

**In the first phase, following the break-up of the fSU, the EU established a wide array**
**of S&T cooperation actions to support the process of** **transformation** **[5]** **.** **Cooperation in**
**nuclear fission safety (Chernobyl) and ITER, the controlled fusion project, had already**
**been previously** **established.** **The COPERNICUS action was set up for Central Europe;**
**researchers from the NIS were associated in 1994. Support was provided for**
**participation in joint projects under five Specific Programmes of the 3rd FP. Founded**
**as a private association, INTAS was specifically set up to support the general RTD**
**potential in NIS via joint projects. THERMIE established cooperation in the energy**
**sector, TEMPUS in higher education. NIS participation in some COST actions extended**
**the joint European scientific networks. EUREKA accepted the RF as a member for**
**industrial cooperation. European research organizations, such as CERN,** **ËSO** **and the**
**ESA,** **reinforced the already existing relations in their specific scientific fields. In**
**addition, individual Member States, other nations, international organizations and non-**
**governmental organizations have contributed in different fields to enhance the scientific**
**cooperation without much coordination.**

**3.** **Present conditions in the aftermath of the SU in S&T**

**Science was prestigious in the** **fSU** **and the belief in the power** **of'scientific-technological**
**progress' belonged to the communist rhetoric. Despite the quantity and the undoubted**
**quality of** **RTD** **activity, there were at the same time very clear deficiencies. The** **science**
**organization pursued purposes other than scientific concepts which normally apply in**
**market economies and democracies. Science in the fSU had been committed to advance**

see in particular COM(94) 420 final: 'Cooperation in Science and Technology between the European Union and
the countries of Central and Eastern Europe on the one hand and the new independent States of the former Soviet
Union on the other*, and the brochure European Commission: Scientific and technological cooperation with Eastern
Europe, Brussels-Luxembourg 1994

**selected technologies mostly geared towards** **achieving** **military superiority and to**
**demonstrating the supremacy of communism. As such it had been operating in the**
**beginning very successfully. It reached the climax with the launching of the sputnik.**

**In** **the eighties the** **fSU** **missed out on the dynamic development of** **the** **information and**
**communication** **technologies** **and their wide application in society. In the West**
**'information'** **advanced to become one of the key factors for technological development**
**(the 'information society*). Non-democratic societies, though, could not allow**
**uncontrolled individual communication. Thus, the structure of society turned out to be**
**the main barrier to exploitation of** **these** **new technological advances. Progress in**
**contemporary societies does not simply depend on the scientific steps forward but it**
**must assure** **aie** **appropriate implementation and application in society. Neglecting this**
**aspect undoubtedly contributed to the final collapse of the economic system.**

**3.1.** **Heritage of the Past**
**The conditions of scientific development within the fSU were able to produce some**
**quite different and original scientific solutions which were not communicated to the**
**international scientific community. However, deficiencies which stem from the past**
**Soviet system prevail. They can be summarized as follows:**

*** a predominant military orientation of S&T and of the relevant industrial**
**production with a bias towards specific subjects such as nuclear physics, space**
**and laser technologies, plus mathematics;**

*** the isolation of** **most** **scientists from the world community, the secrecy of much**
**of their work, often carried out in secret cities, has led to limited skills in**
**languages used by the international scientific community and to restricted**
**participation in international debates and networks;**

*** no private ownership, no industrial property** **rights** **and no individual patents;**

*** a centralistic structure with negative consequences for the regions: regional**
**imbalance, no connection with local problems, long distance in the innovation**
**processes between industrial production sites and related research centres;**

*** absence of effective links between education (universities) and research**
**(Academy of Sciences or research centres);**

*** a heavy bureaucracy, with hierarchical top-down style of organization which**
**contributed to the creeping degradation of** **the R&D** **system during the '80s, and**
**no cost efficiency or consciousness in the sector;**

*** no market and little consumer orientation and no problem-solving capacity,**
**extreme supply-side alignment of a centrally planned economy;**

*** a lack of information and communication technology development for**
**application in industry and consumer goods;**

*** no recognition of environmental problems and a lack of energy-saving**
**technologies;**

*** no independent and critical discipline of** **economics,** **financial** **affairs, business**
**studies, management, etc.;**

_**AZ,**_

    - no empirical social sciences research to follow and monitor the ongoing processes
in society, but 'scientific Marxism-Leninism' as the ideological affirmation.

The science sector, though strong, well developed and dominant in society, is facing important
changes. Cooperation with the EU can help to bring about important structural changes that
are called for to adapt to the new situation.

3.2. Size and Volume of the Science Sector
The science sector in terms of personnel compared to other industrialized countries was highly
oversized: after a steep drop the RSE* per thousand labour force ( 12.9 in 1989, 11.4 in 1990)
was still 10.1 in 1991, compared e.g. with the 1991 EU average of 4.2.

Governments cut down the expenditure for science sharply, as the inherited science sector
could not contribute to improve the economic and social situation in the short term. From
around 3.5% of GDP spent on R&D by the end of the '80s, the share [6] still corresponded to
2.1% of GDP in 1990. Today, in the NIS it possibly counts for less than 0.5%, taken into
account that the GDP itself has shrunk by approximately 50%. In comparison the average EU
spending on S&T is 2% of GDP.

The dramatic reduction of financial resources was introduced without proper planning.
Meanwhile the Russian Ministry of Science and Technology Policy suggested a priority
scheme. In view of the severe social consequences, it remains to be seen whether the plan will
generate reduced and more effective RTD structures. Institutes and organizations with 5000
and more staff are less creative in terms of working conditions and, like bigger structures in
general, tend to resist reform.

Under present conditions the output from the science sector is insufficient. The operating
budget is spent largely on basic functions such as heating and electricity. In addition, staff
salaries are very low which affects motivation and often institutes are closed for days and
weeks to save on energy or premises are rented out to earn additional money.

3.3. Understanding Brain Drain
The reduction of personnel in the oversized structures will have to continue. The question is
how to keep the best scientists on the one hand and how to stimulate chances for leaving
researchers to make use of their science background for the benefit of modernization of
industries. In this sense, the brain drain is necessary. The fear of the brain drain appeared as
the main argument in favour of fellowship programmes. However, fellowships also may
function as stepping stones to prepare emigration.

No fellowships were awarded under the EU RDT cooperation scheme with the NIS. Instead,
the EU considers that cooperative research projects - e.g. for SMEs to start with the
development of technological products - can better redirect the internal brain drain flow to
inferior jobs into fields of technical competence and industrial innovation. Nevertheless the
disapproval of the so-called 'internal brain drain' is only slowly decreasing. The argument is
driven by the former prestige of scientists: a 'minor

Research Scientists and Engineers

6
corrected according to the OECD calculation see: OECD, Science, Technology and Innovation Policies, Federation
of Russia, Volume I, Paris 1994

**commercial** **job'** **for a 'better** **salary*** **seemed unacceptable. With the pressure to reduce**
**the overall number of researchers, movements into private business can be considered**
**as a self-regulating process to redistribute talented people to new and needed**
**occupations.**
**'External brain drain', despite the original fears, remained moderate. After a first wave**
**of massive academic departures in** **1990/91** **(Jewish and German migration), the drain**
**of scientists has become modest. More temporary contracts are being established**
**between scientists and foreign institutes or industries. They offer a transitional solution**
**for persons who wish to extend their knowledge and mobilize their acquired**
**qualifications** **in new environments. After a first panic reaction today the positive**
**elements of brain drain are also appreciated. Departures out of an open political system**
**with new exchange channels - different than in the past - leave the scientists the**
**possibility to continue communication with their former institutions, mostly to the**
**benefit of both sides. An informal twinning of institutes could emerge from these**
**relations.**

**There is no publicly available information on brain drain from the military-industrial**
**complex into particular countries interested in the secrets of weapon technologies.**
**Frequent movements of Russian scientists occur, especially out of the Baltic** **States,** **but**
**also from Kazakhstan or other non-Russian republics. Having worked in military**
**research centres outside Russia, now unemployed and with no relation to Russia or**
**Russian research institutions nor to their present State of residence, it is this group**
**which might feel the temptation to accept offers from third countries.** **The** **ISTC, in**
**particular, aims to apply** **knowledge** **acquired in military research for civil projects. The**
**results of this action should help to limit the scientific military brain drain.**

**3.4.** **New territorial arrangement of the S&T sector in the NIS**
**As a consequence of the break-up of the fSU, the S&T sector has become dissociated.**
**Important institutes and production sites which previously formed a chain are today**
**located in different States. Disrupted, incomplete cycles and chains of innovation and**
**application are a frequent problem.**

**Approximately 70% of the research capacity stayed on the** **territory** **of the Russian**
**Federation, again with a very uneven regional distribution. Ukraine is the second**
**important site for military and civilian S&T after Russia. Some NIS still have a high**
**concentration of (military) research centres on their territory with** **the** **difficulty of**
**relating these centres to their national needs while other countries received no high-**
**level research institution for their future development. Both situations cause severe**
**problems for the new national support structures.**

**The attempt to reunite the former links in these chains will not necessarily provide the**
**best solutions as production conditions** **and** **market prospects have changed. Cooperation**
**proposals from former partners will be welcome if they prove the feasibility of industrial**
**innovation in the new cooperation.**

**3.5.** **Emerging diversity of regional cooperation**
**Strategies for regional RTD cooperation in the NIS are conditional as the political**
**relations developing between the individual States are not yet stable. Relations in**
**negotiations between NATO, OSCE and individual NIS influence the** **attachment** **in the**
**region. The RF represents, with its huge economic, social and military potential, the**
**greatest challenge for the EU. Concerning other** **NIS,** **the westernmost (Ukraine, Belarus,**
**Moldova) are in need of cheap energy supplies. The Central Asian Republics hold**

**important economic potential, especially in the energy sector, but they demand massive**
**investments for adequate exploitation. The Trans-Caucasian republics need even greater**
**support, taking into account, in particular, the instability which affects the region.**
**Access to European trade, investment and technology, therefore, is a priority for all**
**partners. The RF will remain the main shaping factor, its course will have the main**
**impact on developing options for all other NIS.**

**The original differentiation between the CEEC and NIS could become blurred with**
**further development. Regional cooperation treaties between neighbouring countries**
**contribute to creating new regional cooperation patterns. Thus** **CEEC/NIS** **zones with**
**different needs for S&T cooperation are taking shape: the westbound zone, associated**
**to the EU, the westerly NIS zone between Russia and the EU, a Trans-Caucasian zone,**
**the Central Asian Republics and the Russian Federation** **itself.** **Studies and a permanent**
**dialogue** **will have to investigate their changing options and requirements.**

_**•if**_

ABBREVIATIONS

ACE Action for Cooperation m the Field of Economics
**ACP** Agreement on Partnership and Cooperation
APE European Patent Organization
CEE Central and Eastern Europe
CIS Commonwealth of Independent States
COPERNICUS Action in support of the countries of Central and Eastern Europe and
since 1994 for the NIS in the field of research, outside the five specific
programmes open to third countries
COST European Cooperation in the Field of Science and Technology
CERN European Centre for Nuclear Research
CRAFT Cooperative Research Action for Technology
ESA European Space Agency
ESO European Southern Observatory
EU European Union
EUREKA European Network for Industrial Research Cooperation,
FDI Foreign Direct Investment
FP Framework Programme
fSU former Soviet Union
IMF International Monetary Fund
INCO International Cooperation in S&T ( Programme of DG XII)
INTAS International Association for the Promotion of Cooperation with Scientists
from the Independent States of the Former Soviet Union
ISTC International Science and Technology Centre
IRDAC Industrial R&D Advisory Committee of the European Commission
NATO North Atlantic Treaty Organization
NIS New Independent States
OECD Organization for Economic Cooperation and Development
OSCE Organization for Security and Cooperation in Europe (former CSCE)
R&D Research & Development
RF Russian Federation
RTD Research and Technological Development
TACIS Technical Assistance for the Commonwealth of Independent States
TEMPUS Trans-European MobiUty Programme for University Students
THERMIE European Technology for the Mastering of Energy
UNCTAD United Nations Conference on Trade and Development
WTO World Trade Organization

**yanpcopdoc** **XB.138J5-***

**ANNEX II**

**1.** **Background**

INTAS : THE INTEGRATION OF INTAS

After the break-up of the Soviet Union events gained pace and the resultant disorganization
of the economy seriously called into question the position of science and technology in the
new independent States which had emerged.

In response to various resolutions from the European Parliament and to the critical situation
of science in Eastern Europe, which was still unpredictable at the time of adoption of the third
Framework Programme, funds were set aside outside the Framework Programme for
cooperation in science and technology with the countries of Eastern Europe.

At its April 1992 meeting on research the Council decided to back the Commission's initiative
to support science and technology in the NIS and asked the Commission to examine the
possibility of setting up an international foundation.

The Association for the Promotion of Cooperation with Scientists form the New Independent
States of the former Soviet Union (INTAS) was set up for limited period of time as a private
association under the Belgian law. The Statutes of this Association were approved by the
Commission on 17 December 1992 for a pilot period ending on 31 December 1994.

The objectives of INTAS were as follows :

to provide rapid, efficient support by means of flexible, effective action to maintain
the scientific potential of the NIS;

to attract resources and partners in addition to those provided by the European Union;

to ensure formal participation by the Member States in an action outside the
Framework Programme.

A separate structure outside the general organization for Community RTD programmes could
have been foreseen following Article 130 O and 130 Q of the Acte Unique Treaty. However,
this disposition requires the unaminity of the Council. It was necessary therefore that the
completion of the INTAS objective was satisfactorily achieved within the pilot phase.

On 23 November 1994 the Council adopted a specific programme of research and
technological development; including demonstration, in the field of cooperation with third
countries and international organizations (1994 to 1998). This confirmed the Community's
participation in the pilot phase of INTAS which was extended until 31 December 1995. In
Annex 1 of the Specific Programme, the Council approved the Community participation in
INTAS as a preparatory activity which will end on 31.12.95.. Any prolongation of that period
is subject to a Council decision.

**^**

On 27 December 1994 the member of the Commission responsible for research sent a letter
to the Union Member States stating that the Commission would be sending the Council **a**
communication on the future of INTAS.

At the Council meeting on 10 March 1995, the Commission informed the Council that it had
decided to grant INTAS funding totalling ECU 5 million in 1995. The Council asked the
Commission whether it was possible to revise this amount upwards. The Commission also
announced that a document on the Community's future participation in INTAS would be
submitted to the Council on 9 June 1995.

**2.** **Practical experience with INTAS**

A restricted call for proposals was published before the official inauguration of INTAS. After
this preliminary round, INTAS decided to proceed with calls for proposals open to all fields
of natural and human science in an attempt to involve as many scientists as possible from the
NIS.

On this basis, a call for proposals closed in October 1993 resulted in the selection of 509
projects granted ECU 21 million and a second call closed in April 1994 saw the selection of
459 projects to receive ECU 20 million (8000 proposals were received in response to these
two calls).

Coopers & Lybrand conducted an evaluation of INTAS and the Commission asked Ernst &
Young to carry out a financial audit.

According to the audit by Ernst & Young, as yet the Association lacks an accounting system
allowing systematic monitoring of all entitlements and commitments.

**3.** **Relations between** the **results of INTAS and the objectives set**

3.1. Speed and efficiency of the action

Cooperation with the NIS is certainly no easy matter. Nevertheless, the International Science
and Technology Centre (ISTC), set up by an intergovernmental agreement (between Japan,
the USA, the Russian Federation and the European Union) in Moscow to help convert military
scientific activities to peaceful purposes, started operations in April 1994. Over 3000 scientists
have received funds from this Centre already in the ten months since then.

Similarly, in 1994 a call for proposals was published under the COPERNICUS programme
(for the countries of Central and Eastern Europe and the NIS) run by DGs III, XII and XIII.
220 projects were selected (including 45 participants form NIS) and all the contracts were
signed within eight months. One year after the 1994 call, none of the INTAS contracts were
signed. In addition, many of the contracts from the 1993 call have yet to be signed.

It is therefore clear that establishment of a body outside the Commission has by no means
speeded up procedures, on the contrary.

What is more, INTAS's costs per million ECU committed are some five times higher than
those of the Commission for a comparable scheme such as COPERNICUS : this is attributable
mainly to the number of staff employed on each scheme. The audit by Ernst & Young
estimated the administrative costs at around 13.5 % of the 1994 budget of approximately ECU
22.7 million. This percentage will rise even higher if INTAS were to continue but with lower
funding than at the moment.

All INT AS's activities have been based on providing support for as many scientists as
possible from the NIS in every field of natural and human science. INTAS justified this policy
by pointing to the urgent situation created by the break-up of the Soviet Union. It has indeed
been taken as the basis for a series of activities of this type by the International Science
Foundation set up by Mr Soros. Today the urgent situation has given way to a structural
phenomenon calling for a different approach. The scale of this phenomenon far surpasses the
support available under the FP. As demonstrated by an OECD evaluation of the science
system in Russia, there are too many researchers in this country. Under the guidelines for
activity 2 of the FP, the action taken by the Community must concentrate solely on the mutual
interests of the Member States of the Union and of the beneficiaries and on selective support
for the most competitive teams. The policy pursued by INTAS is out of line with the
objectives of the 4th FP on international cooperation and with the interests of the NIS, since
it endeavours, despite the limited resources, to maintain research potential in every field of
science and technology without any foundation in economic reality.

Examination of the list of projects selected shows that thëy are scattered widely, often in
fields far removed from the problems currently facing these countries and from the criteria
set out in INTAS's statutes of "promotion of "scientific research as a key component in
economic and social progress and in consolidating democracy' [1] .

3.2. Funding in addition to the support from the European Union

The European Union members of INTAS contributed ECU 0.33 million (0.6 %) to the budget
in addition to the 95% contribution from the Community. Austria, Finland, Norway, Sweden
and Switzerland have contributed ECU 2.41 million. INTAS members have also seconded
eight national experts and the Commission has seconded two officials to INTAS. In the 4th
Framework Programme, the share from the Community budget will rise to almost 100 % with
the accession of new Member States to the European Union and the participation of Norway
and Switzerland in the 4th Framework Programme on the basis of the EEA Agreement and
a bilateral agreement respectively.

Under these circumstances, there is no longer any reason for a separate structure. In fact, the
preparatory activity has shown that there is no need for such a separate structure (Article
130N). Furthermore, if such a structure were to persist, it would attract criticism from the
European Parliament and the Court of Auditors.

Also, the annual funding provided for in the 4th Framework Programme is half the amount
available in 1994. This signifies that in order to attain the objectives of activity 2 in the
Framework Programme and to avoid excessive cuts in the support for the countries of Central
and Eastern Europe, the Commission will be unable to earmark any more than ECU 10
million to INTAS's tasks in future. As is the case for the rest of international cooperation,
the financial contributions from beneficiary countries will be added to this amount. Clearly,
this will not be enough to fund a structure with operating costs as high as INTAS (over ECU

### **T^**

**2.5 million per year, including the seconded national experts).**

**3.3.** **Discussion and coordination forum**

**INTAS provided a means for the Member States to participate in the implementation of this**
**support for the NIS while there was still no committee for this programme. The establishment**
**of the committee for the international cooperation side of the 4th Framework Programme**
**removed the raison d'être for INTAS.** **In** **practice, parallel operation of two similar**
**committees, the type III A committee for the** **international** **cooperation programme on the one**
**hand and the INTAS General Assembly on the other, creates confusion about the division of**
**responsibility.**

**4.** **Conclusions**

**Cooperation with the NIS comes under the 4th Framework Programme and the committee for**
**the international cooperation programme assists the Commission in implementing this action.**
**Since the urgent situation in the countries receiving the support has turned into a structural**
**problem, the preparatory scheme should be replaced by a regular activity within the 4th**
**Framework Programme. The fact that the annual funding available for scientific cooperation**
**with Eastern Europe is now half the amount available in 1994 is another factor in favour of**
**concentrating activities within the Framework Programme.**

**INTAS has received no significant funding apart from** **the** **resources from the European Union.**
**Practical experience with INTAS has failed to show that it is faster and more efficient than**
**the Commission - on the contrary. Nevertheless, the need and interest for Europe to provide**
**support for the scientific and technical potential in the NIS remain. The achievements of**
**INTAS should be safeguarded and valued and the continuity of the action as such will be**
**ensured. Under these circumstances, the Commission has reached the following conclusions**

**1.** **The Commission therefore does not propose a draft decision for the**
**continuation of Community** **participation** **in INTAS** **after** **31.12.95.**
**Furthermore, the Commission as a representative of the Community in the**
**INTAS Assembly will not agree to a continuation of the Association after that**
**date (in accordance with Article 1, paragraph 4 of the INTAS statutes).**

**2.** **The cooperation to support science and technology** **in** **the NIS must continue.**
**However, the activities must be targeted more to concentrate resources on the**
**real priorities. The scale of the needs in relation to the resources available**
**makes it impossible to cover every scientific discipline** **without** **spreading the**
**resources too thinly. In particular, the support should focus on fields in which:**

**the former Soviet Union was particularly skilled (space, mathematics,**
**informatics, theoretical physics, etc.);**
**vital hardware or data can be harnessed;**
**research** **is essential in order to resolve certain major problems specific**
**to these countries.**

##### **_zo_**

3. The corresponding section of the international scientific cooperation
programme will be carried out within the normal regulatory framework
provided for implementation of the research programmes. National experts
from Member States could be involved in the Community activities as
required.

4. The Commission will be assisted by the committee for the international
cooperation programme in accordance with the rules of comitology. The
committee will take over the role of the INTAS General Assembly.

5. The tasks of the INTAS Scientific Council will be carried out by a committee
created for this purpose.

6. To build on what has been achieved and uphold the political signal given by
cooperation with the NIS, the designation INTAS could be maintained and the
contacts established in the NIS could be kept up.

7. In the frame of the financial means foreseen for cooperation with the NIS by
the Specific Programme, an amount of about 10 MECU per year, during the
period 1996-1998 will be reserved for this activity. As is the case for the rest
of international cooperation, the financial contributions from beneficiary
countries will be added to this amount.

**FINANCIAL STATEMENT**

1. TITLE OF OPERATION

Reincorporation within the Commission of the activities of the International Association
for the Promotion of Cooperation with Scientists from the New Independent States of the
former Soviet Union (INTAS) and cooperation with scientists from these States.

2. BUDGET HEADING INVOLVED

B6-7211

International scientific cooperation

3. LEGAL BASIS

Council Decision 94/807/EC of 23 November 1994

4. DESCRIPTION OF OPERATION

4.1 General objective _Y_

To reincorporate the activities of INTAS within the Commission in order to promote
scientific and technological cooperation with the new independent States of the former
Soviet Union, with a view, in particular, to stabilizing the RTD potential and providing
support for scientists in these countries.

4.2 Fields covered

Measures necessary on staff and premises in order to conduct scientific and technological
research activities, with a view, in particular, to stabilizing the RTD potential as provided
for in the work programme on international cooperation.

4.3 Period covered

1996 and thereafter.

5. CLASSIFICATION OF EXPENDITURE OR REVENUE

Non-compulsory expenditure.

_**£J**_

```
6. TYPE OF EXPENDITURE OR REVENUE

```

This expenditure by the Commission replaces a grant for funding INTAS. The objective
is to transfer the resources in order to implement scientific and technological cooperation
schemes between the Member States and the new independent States.

FINANCIAL IMPACT

7.1 Amount deemed necessary (1995-1998)

Allocation for the programme
Appropriations available in 1995
Preliminary draft research budget
EFTA/EEA contribution

**Total appropriations for 1995:**

Appropriations available for aid expenditure in 1995
Preliminary draft research budget
EFTA/EEA contribution

**Total appropriations for aid expenditure 1995:**

578.000 MECU*

56.450 MECU

3.467 MECU

0.940 MECU

**60.857** MECU

42.621 MECU

3.467 MECU

0.723 MECU

46.811 MECU

Cost of the operation to be covered under Art. 53 5.000 MECU
**BALANCE:** **41.811** MECU

PROGRAMME SCHEDULE

TOTAL*

578.000

578.000

1999+

—

201.364

MECU

Commitments

Payments

1998

197.083

146.000

1997

176.000

86.000

1995

59.917

38.636

1996

145.000

106.000

- The Commission will submit a proposal for a 7% increase for the fourth (199498) framework programme, to allow for enlargement, to the Council and
Parliament.

7.2 Method of calculating total cost of operation

```
1992

1993

1994

1995

1996

```

10.6 MECU (amount requested)

# **^i**

**4**

**22**

**20**

**5**

MECU

MECU

MECU

MECU

**Grant for INTAS**

**7.3** **Itemized** **breakdown of cost**

**The operation covers the operating expenditure for the new calls for proposals.**

**Reincorporation of 8 seconded national experts** **=** **ECU** **300 000**

**Internal staff (5 persons)** **=** **ECU** **250 000**
**Rent and leases** **=** **ECU** **50 000**
**New call for proposals** **=** **ECU 10 000 000**

**7.4** **Indicative schedule of appropriations (in ECU million)**

Appropriations

Commitments

Payments

1998

**10.6**

**10.6**

1996

**10.6**

**0.6**

1997

**10.6**

**10.6**

**8.** **ELEMENTS OF COST-EFFECTIVENESS ANALYSIS**

**8.1** **Specific objectives: target population**

**The objective of the activities reincorporated by the Commission is to contribute to**
**promoting cooperation with the new independent States of the former Soviet Union in**
**the field of research and technological development, with a view, in particular, to**
**stabilizing the RTD potential in these countries.**

**8.2** **Grounds for the operation**

**The pilot phase, limited to 1995,** **fits** **into the framework for international cooperation**
**in the** **field of research (Article** **130i** **of the Treaty) with the objective of safeguarding the**
**RTD potential, as provided for in the work programme.**

**8-3** **Monitoring and evaluation of the operation**

**The projects will be monitored and evaluated within the general framework of** **the** **fourth**
**framework programme.**

**9.** **ANTI-FRAUD DISPOSITION**

**A number of existing administrative and financial controls are carried out in all areas of**
**signing** **and** **the execution of** **research** **contrats. Among these controls, one can summon**

_**In**_ _**the**_ _**previous stage of**_ _**the conclusion**_ _**:**_

**The initial selection of proposals on the base of** **the** **scientific value of** **the** **project**
**and the costs of** **the** **research according to the area, the duration and the potential**
**impacts.**

**Z**
**M**

**The Analysis of the financial data transmitted by the proposers in a** **négociation**
**form.**

_**After the**_ _**signature**_ _**of the contract :**_

**Examining the expense report before payment, at all levels (the financial**
**administrators and the scientific administrators).**

**In house** **control permits, by the examination of justificatory** **documents,** **to detect**
**the errors or other irregularities. In** **order** **to reinforce the effectiveness of these**
**controls, the departments of the Commission created an audit committee** **which**
**centralises and carries out the overall controls. These controls are effective**

**through the members of the audit committee, or audit firms with whom the**
**Commission have concluded framework contracts and are under the supervision**
**of the audit committee.**

###### **_Zs_**

**ISSN** **0254-1475**

**COM(95)** **190** **final**

## **DOCUMENTS**

**EN** **15 U**

**Catalogue number** **:** **CB-CO-95-223-EN-C**

**ISBN** **92-77-89077-0**

**Office** **for Official** **Publications of the** **European** **Communities**

**L-2985** **Luxembourg**

_**2£**_

**>**