CELEX: 52011PC0810
Language: en
Date: 2011-11-30
Title: Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL laying down the rules for the participation and dissemination in 'Horizon 2020 – the Framework Programme for Research and Innovation (2014-2020)'

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		52011PC0810
		
			Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL laying down the rules for the participation and dissemination in 'Horizon 2020 – the Framework Programme for Research and Innovation (2014-2020)' /* COM/2011/0810 final - 2011/0399 (COD) */
			
				
		
		
			
			   	EXPLANATORY MEMORANDUM
1.           CONTEXT OF THE PROPOSAL
The set of proposals for "Horizon
2020" fully supports the Europe 2020 strategy, which identified research
and innovation as central to achieving the objectives of smart, sustainable and
inclusive growth. They consist of proposals for a Framework Programme "Horizon
2020", a single set of Rules for Participation and Dissemination, a single
Specific Programme to implement "Horizon 2020", as well as a separate
proposal for the parts of "Horizon 2020" corresponding to the Euratom
Treaty.
Designed to support the Europe 2020 Flagship
Initiative "Innovation Union"[1],
the basic principle of "Horizon 2020" and these rules is to adopt a
much more strategic approach to research and innovation. All policy instruments
and measures are designed to contribute to research and innovation and to
further develop the European Research Area whereby knowledge, researchers and
technology circulate freely, and to accelerate the commercialisation and
diffusion of innovation across the Single Market.
The rules proposed were drawn up with the
twofold aim of:
–              
Ensuring a single and sufficiently flexible
regulatory framework which will render participation easier, create a more
coherent set of instruments covering both research and innovation and increase
the scientific and economic impact while avoiding duplication and
fragmentation. 
–              
Simplifying the terms and procedures from the
perspective of the participants to ensure the most efficient implementation,
taking into account the need for easy access for all participants.
The following new features have been introduced
into the rules for participation and dissemination in order to apply the above
principles and to bring the rules into line with the characteristics and
objectives of the new framework programme:
–              
The rules will apply to all components of
"Horizon 2020", including initiatives under Articles 185 and 187
TFEU, actions currently falling within the scope of the Competitiveness and
Innovation Programme as well as the EIT activities. The necessary flexibility
corresponding to the different nature of the research and innovation actions is
ensured by appropriate derogations and by allowing to set out specific
participation details in the work programmes;
–              
The rules for participation relating to the Union
funding are based on the revised Regulation of the European Parliament and the
Council on the financial rules applicable to the annual budget of the Union[2] which has streamlined and
rendered more efficient the way in which Union policies can be implemented.
–              
The financial provisions relating to the Union
funding in the form of grants have been clarified and simplified. Thus, they
are now establishing a single funding rate depending for each type of action
funded under "Horizon 2020" with no differentiation among
participants. Enhanced use of lump sums, flat rates and scale of unit costs is
also proposed.
–              
For direct costs, these rules provide for a
broad acceptance of the usual accounting practices of grant beneficiaries,
subject to a minimum number of boundary conditions. The grant agreement will
include further simplification provisions allowing beneficiaries to gain legal
certainty on the eligibility of the costs charged to actions under
"Horizon 2020". Those simplification provisions will include, among
others, a clear definition of the time recording requirements and objective
references regarding the annual productive hours.
–              
For indirect costs, the calculation is radically
simplified; the reimbursement foresees a flat rate based on total direct
eligible costs of participants with a possibility to declare costs actually
incurred which is limited to non-profit legal entities.
–              
Rules applying to the new forms of funding allow
for more flexibility, such as those related to prizes to be awarded for the
achievement of pre-specified targets or those related to public pre-commercial
procurement and procurement of innovative solutions as well as those related to
the financial instruments.
–              
Given its demonstrated efficiency as a safeguard
mechanism, the participants' Guarantee Fund set up under the Seventh Framework
Programme will be renewed for the entire duration of "Horizon 2020"
with clearer rules and the possibility to extend it to cover risks undertaken
in actions under the EURATOM Framework Programme.
–              
The rules regarding intellectual property,
exploitation and dissemination have been modelled on the widely acknowledged Seventh
Framework Programme provisions with further improvements and clarifications.
Specific new emphasis has been put on open access to research publications and
an opening was made for experiments with open access to other results. The
enlarged scope and new forms of funding as well as the need for flexibility in
this area of the rules has been taken into account by the possibility to lay
down additional or specific provisions where appropriate. Access rights for the
European Union, and in the field of security research also for Member States,
have been foreseen.
Furthermore, the participation of legal
entities established in third countries and of international organisations in actions
under "Horizon 2020" will be streamlined and stimulated, in line with
the objectives of international cooperation set out in the Treaty, based on
mutual benefits and taking into account the conditions for the participation of
European Union entities to third countries’ programmes.
Within the clear and stable framework,
participants will enjoy further flexibility to determine the most appropriate
internal arrangements for the implementation of their actions. This should
encourage and facilitate the participation of all research stakeholders,
including small research units, particularly SMEs.
2.           RESULTS OF CONSULTATIONS WITH THE
INTERESTED PARTIES AND IMPACT ASSESSMENTS
The preparation of the proposal took full
account of the responses to an extensive public consultation based on a Green
Paper, "From challenges to opportunities: towards a common strategic
framework for Union research and innovation funding", COM(2011)48. Views
were expressed by the European Council, Member States and a wide range of
stakeholders from industry, academia and civil society.
The consultations carried out have identified
the following obstacles:
–              
The most important one from the participant's
perspective is the complexity of administrative procedures along with the
administrative burden.
–              
Participants also find very burdensome to apply
different sets of rules depending on the Union research and innovation
programme and called for a greater consistency of rules between instruments.
–              
The last issue is the need to introduce a
risk/trust balance. Currently too many procedures, in particular regarding
financial controls, appear to be designed exclusively to ensure a very low risk
of errors, but also result in control mechanisms perceived as rigid and
excessive.
The basic principles established by these rules
have been reviewed through a formal Impact Assessment.
3.           LEGAL ELEMENTS OF THE PROPOSAL

1.1.                
Legal base

Horizon 2020 legislative package integrates
research and innovation activities in a seamless way in order to achieve the
policy objectives. 
The Rules for Participation and dissemination will
be based on the TFEU Titles "Industry" and "Research and
technological development and space" (Articles 173, 183 and 188).

1.2.                
Subsidiarity and proportionality principles

The Horizon 2020 package has been designed to
maximise EU added value and impact, focusing on objectives and activities that
cannot be efficiently realised by Member States acting alone. The Rules for
participation and dissemination are intended to facilitate the implementation
of Horizon 2020 proposal and therefore the subsidiary analysis presented with
therein applies.
The principle of proportionality is satisfied
inasmuch as the proposed simplification and rationalisation ensure that EU
action would not go beyond the minimum necessary to achieve the objectives of
ensuring the implementation of the Horizon 2020.
2011/0399 (COD)
Proposal for a
REGULATION OF THE EUROPEAN PARLIAMENT
AND OF THE COUNCIL
laying down the rules for the participation
and dissemination in 'Horizon 2020 – the Framework Programme for Research and
Innovation (2014-2020)'
(Text with EEA relevance)
THE EUROPEAN PARLIAMENT AND THE
COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the
Functioning of the European Union ("TFEU"), and in particular
Articles 173, 183 and the second paragraph of Article 188 thereof,
Having regard to the proposal from the
European Commission,
After transmission of the draft legislative
act to the national Parliaments,
Having regard to the opinion of the
European Economic and Social Committee[3],
Having regard to the opinion of the Court of Auditors [4],
Acting in accordance with the ordinary
legislative procedure,
Whereas:
(1)              
"Horizon 2020 - the Framework Programme for
Research and Innovation (2014-2020)" (Horizon 2020) was adopted by Regulation
[X] of the European Parliament and of the Council of [X] establishing Horizon
2020 – The Framework Programme for Research and Innovation[5]. That Regulation needs to be
complemented by rules for participation and dissemination.
(2)              
Horizon 2020 should be implemented with a view
to contributing directly to creating industrial leadership, growth and
employment in Europe and should reflect the strategic vision of the Commission
Communication of 6 October 2010 to the European Parliament, the Council, the
European Economic and Social Committee and the Committee of the Region "Europe
2020 Flagship Initiative Innovation"[6]
whereby the Commission engages to radically simplify access of participants.
(3)              
Horizon 2020 should support the achievement and
functioning of the European Research Area in which researchers, scientific
knowledge and technology circulate freely, by strengthening cooperation between
the Union and the Member States, notably through application of a coherent set
of rules.
(4)              
The rules for the participation and
dissemination should adequately reflect the recommendations of the European
Parliament, as summarised in the "Report on simplifying the implementation
of the Research Framework Programmes"[7],
and Council with regard to the simplification of the administrative and
financial requirements of the research framework programmes. The rules should
give continuity to the simplification measures already implemented under Decision
No 1982/2006/EC of the European Parliament and of the Council of 18 December
2006 concerning the Seventh Framework Programme of the European Community for
research, technological development and demonstration activities (2007-2013)[8] and progress further in
reducing the administrative burden for participants and the complexity of the
financial provisions in order to decrease financial errors. The rules should
also duly consider the concerns and recommendations from the research community
resulting from the debate initiated by the Commission Communication
of 29 April 2010 to the European Parliament, the Council, the European Economic
and Social Committee and the Committee of the Regions "Simplifying the
implementation of the research framework programmes",[9] and the subsequent Green Paper of 9 February 2011 "From
Challenges to Opportunities: Towards a Common Strategic Framework for EU
Research and Innovation funding"[10].
(5)              
In order to ensure coherence with other Union
funding programmes, Horizon 2020 should be implemented in accordance with
Regulation (EU) No. XX/XX of the European Parliament and of the Council of […]
on the financial rules applicable to the annual budget of the Union,[11] and the Delegated Commission
Regulation (EU) No. X/X of […] amending the detailed rules for the implementation
of the Financial Regulation[12].
(6)              
An integrated approach should be ensured by
bringing together activities covered by the Seventh Framework Programme for
research, the Competitiveness and Innovation Framework Programme and the European
Institute of Innovation and Technology (the EIT) to make participation easier,
create a more coherent set of instruments and increase the scientific and
economic impact while avoiding duplication and fragmentation. Common rules
should apply in order to ensure a coherent framework which should facilitate
the participation in programmes receiving Union financial contribution from the
budget of Horizon 2020, including the participation in programmes managed by the
EIT, joint undertakings or any other structures under Article 187 TFEU or participation
in programmes undertaken by Member States pursuant to Article 185 TFEU.
However, flexibility to adopt specific rules should be ensured when justified
by the specific needs of the respective actions and with Commission consent.
(7)              
Actions which fall within the scope of this
Regulation should respect fundamental rights and observe the principles
acknowledged in particular by the Charter of Fundamental Rights of the European
Union. Such actions should be in conformity with any legal obligation and with ethical
principles, which include avoiding any kind of plagiarism. 
(8)              
In line with the objectives of international
cooperation as set out in Articles 180 and 186 TFEU, the participation of legal
entities established in third countries and of international organisations
should be promoted. The implementation of these rules should be in conformity
with the measures adopted in accordance with Articles 75 and 215 TFEU and be in
compliance with international law. Moreover, the implementation of these rules
should duly take into account conditions for the participation of Union
entities in third countries’ programmes.
(9)              
These rules for the participation and
dissemination should provide a coherent, comprehensive and transparent
framework to ensure the most efficient implementation possible, taking into
account the need for easy access by all participants, notably small and
medium-sized enterprises, through simplified procedures. The financial
assistance from the Union could be provided through different forms.
(10)          
Handling of confidential data and classified
information should be governed by all the relevant Union legislation, including
the Institutions' internal rules, such as Commission Decision 2001/844/EC,
ECSC, Euratom of 29 November 2001 amending its internal Rules of Procedure[13] which lays down the provisions
on security of European Union classified information.
(11)          
It is necessary to establish the minimum
conditions for participation, both as a general rule and with regard to the
specificities of the actions under Horizon 2020. In particular, rules should be
laid down regarding the number of participants and their place of
establishment. In the case of an action without the participation of an entity
established in a Member State, the attainment of the objectives laid down in
Articles 173 and 179 TFEU should be pursued.
(12)          
It is appropriate to establish the terms and
conditions for providing Union funding for participants in actions under
Horizon 2020. In order to reduce the complexity of the existing funding rules
and have a higher flexibility in the project implementation, a simplified cost
reimbursement system should be adopted with enhanced use of lump sums, flat
rates and scale of unit costs. For simplification purposes, a single
reimbursement rate should be applied for each type of action with no
differentiation according to the type of participant.
(13)          
Specific challenges in the area of research and
innovation should be addressed through new forms of funding such as prizes, pre-commercial
procurement and public procurement of innovative solutions which require
specific rules.
(14)          
In order to maintain a level playing field for
all undertakings active in the internal market, funding provided by Horizon
2020 should be designed in accordance with State aid rules so as to ensure the
effectiveness of public spending and prevent market distortions such as
crowding-out of private funding, creating ineffective market structures or
preserving inefficient firms.
(15)          
The financial interests of the Union should be protected
through proportionate measures throughout the expenditure cycle.
(16)          
The participant Guarantee Fund set up under Regulation
No 1906/2006/EC of the European Parliament and of the Council of 18 December
2006 laying down the rules for the participation of undertakings, research
centres and universities in actions under the Seventh Framework Programme and
for the dissemination of research results (2007-2013)[14] and managed by the Commission
has proved to be an important safeguard mechanism which mitigates the risks
associated to the amounts due and not reimbursed by defaulting participants.
Therefore, a new participant Guarantee Fund (the Fund) should be established.
In order to ensure a more efficient management and a better coverage of
participants' risk, the Fund should cover actions under the programme set up
under Decision No 1982/2006/EC, under the programme set up by Council Decision
of 18 December 2006 concerning the Seventh Framework Programme of the European
Atomic Energy Community (Euratom) for nuclear research and training activities (2007
to 2011)[15],
under the programme set up by Council Decision […] of X 2011 establishing the
Framework Programme of the European Atomic Energy Community (2012-2013) as well
as actions under Regulation (EU) No XX/XX [Horizon 2020] and Regulation (Euratom)
No XX/XX of the Council on the Research and Training Programme of the European
Atomic Energy Community (2014-2018) complementing the Horizon 2020- the
Framework Programme for Research and Innovation [Euratom H2020][16]. Programmes managed by
entities other than Union bodies should not be covered by the Fund. 
(17)          
In order to enhance transparency, the names of
experts that have assisted the Commission or relevant funding bodies in
application of this Regulation should be published. Where the publication of the
name would endanger the security or integrity of the expert or would unduly
prejudice his or her privacy, the Commission or funding bodies should be able
to refrain from the publication of such names.
(18)          
Personal data relating to the experts should be
processed in accordance with Regulation (EC) No 45/2001 of the European
Parliament and of the Council of 18 December 2000 on the protection of
individuals with regard to the processing of personal data by the Community
institutions and bodies and on the free movement of such data[17].
(19)          
Rules governing the exploitation and
dissemination of results should be laid down to ensure that the participants
protect, exploit and disseminate those results as appropriate, in particular
the possibility of additional exploitation conditions in the European strategic
interest.
(20)          
For reasons of legal certainty and clarity,
Regulation (EC) No 1906/2006 should be repealed.
HAVE ADOPTED THIS REGULATION:
Title I
INTRODUCTORY PROVISIONS
Article 1
Subject matter and scope
1.                      
This Regulation lays down specific rules for the
participation in indirect actions undertaken under Regulation (EU) No XX/XX of
the European Parliament and of the Council [Horizon 2020], including the
participation in indirect actions funded by funding bodies in accordance with
Article 9(2) of that Regulation.
This Regulation also lays down the rules
governing the dissemination of results.
2.                      
Subject to the specific rules laid down in this
Regulation, the relevant rules of Regulation (EU) No XX/2012 of the European
Parliament and of the Council [the Financial Regulation] and Commission Regulation
(EU) No XX/2012 [its Delegated Regulation] shall apply.
3.                      
A funding body may establish rules which depart
from those laid down in this Regulation or Regulation
(EU) No XX/2012 [the Financial Regulation] if this is provided
for in the basic act or, subject to the consent of the Commission, if its
specific operating needs so require.
4.                      
This Regulation shall not apply to direct
actions carried out by the Joint Research Centre (JRC).
Article 2
Definitions
1.                      
For the purposes of this Regulation, the
following definitions apply:
(1) 'access rights' means rights to
use results or background under the terms and conditions laid down in
accordance with this Regulation;
(2) 'affiliated entity' means any
legal entity that is under the direct or indirect control of a participant, or
under the same direct or indirect control as the participant, or is directly or
indirectly controlling a participant; 
(3) ‘associated country’ means a
third country which is party to an international agreement with the Union, as identified
in Article 7 of Regulation (EU) No XX/XX [Horizon 2020];
(4) 'background' means any data,
know-how and/or information whatever their form or nature as well as any rights
such as intellectual property rights which are (i) held by participants prior
to their accession to the action and (ii) identified by the participants in accordance
with Article 42;
(5) 'basic act' means a legal act
adopted by the Union institutions in the form of a regulation, a directive or a
decision within the meaning of Article 288 TFEU which provides a legal basis
for the action;
(6) 'coordination and support action' means an action consisting primarily of accompanying measures such
as dissemination, awareness raising and communication, networking, coordination
or support services, policy dialogues and mutual learning exercises and studies,
including design studies for new infrastructure;
(7) 'dissemination' means the public
disclosure of the results by any appropriate means (other than resulting from
protecting or exploiting the results), including by publishing in any medium;
(8) 'funding body' means a body or
authority, other than the Commission, to which the Commission has entrusted
budget implementation tasks in accordance with Article 9(2) of Regulation (EU)
No XX/XX [Horizon 2020]; 
(9) ‘international European interest
organisation’ means an international organisation, the majority of whose
members are Member States or associated countries, and whose principal
objective is to promote scientific and technological cooperation in Europe;
(10) 'legal entity’ means
undertakings, research centres and universities, encompassing any natural
person, or any legal person created under national law, Union law or
international law, which has legal personality and which may, acting in its own
name, exercise rights and be subject to obligations;
(11) ‘participant’ means any legal
entity carrying out an action or part of an action under Regulation (EU) No
XX/XX [Horizon 2020] having rights and obligations with regard to the Union or
another funding body under the terms of this Regulation;
(12) 'programme co-fund action' means an action funded
through a grant the main purpose of which is supplementing individual calls or
programmes funded by entities, other than Union bodies, managing research and
innovation programmes; 
(13) 'pre-commercial procurement'
means procurement of research and development services involving risk-benefit
sharing under market conditions, and competitive development in phases, where
there is a separation of the research and development phase from the deployment
of commercial volumes of end-products;
(14) 'public procurement of innovative
solutions' means procurement where contracting authorities act as a launch
customer for innovative goods or services which are not yet available on a
large-scale commercial basis, and may include conformance testing;
(15) 'results' means any data,
knowledge and information whatever their form or nature, whether or not they
can be protected, which are generated in the action as well as any attached
rights, including intellectual property rights;
(16) ‘work programme’ means the document
adopted by the Commission for the implementation of the specific programme in
accordance with Article 5 of Decision No XX/XX/EU of the Council [Specific
programme H2020];
(17) ‘work plan’ means the document
similar to the Commission work programme adopted by funding bodies entrusted with part of the implementation of Horizon 2020 in
accordance with Article 9(2) of Regulation (EU) No XX/XX [Horizon 2020].
2.                      
For the purposes of point (2) of paragraph 1, control
may take any of the forms set out in Article 7.
3.                      
For the purposes of this Regulation an entity
which does not have legal personality under the applicable national law is
assimilated to a legal entity provided that the conditions set out in
Regulation (EU) No XX/2012 [the Financial Regulation] are complied with.
4.                      
For the purposes of this Regulation, grant
recipients shall not be considered funding bodies.
5.                      
For the purposes of point (12) of paragraph 1, actions may also include complementary activities of networking and
coordination between programmes in different countries.
Article 3
Confidentiality
Subject to the conditions established in
the implementing agreements, decisions or contracts, any data, knowledge and
information communicated as confidential in the frame of an action shall be
kept confidential, taking due account of any rules regarding the protection of
classified information.
Article 4
Information to be made available
1.                      
Without prejudice to Article 3, the Commission
shall, upon request, make available to the Union institutions and bodies, any
Member State or associated country, any useful information in its possession on
results of a participant that has received Union funding, provided that both
the following conditions are met:
(a)         
the information concerned is relevant to public
policy;
(b)         
the participants have not provided sound and
sufficient reasons for withholding the information concerned.
In actions under the activity 'Secure
societies' within the specific objective 'Inclusive, innovative and secure
societies', the Commission may make available to Union institutions and bodies
or Member States' national authorities any useful information in its possession
on results of a participant that has received Union funding.
2.                      
The provision of information pursuant to
paragraph 1 shall not be deemed to transfer to the recipient any rights or
obligations of the Commission or of the participants. However, the recipient
shall treat any such information as confidential unless it becomes public or is
made available publicly by the participants, or unless it was communicated to
the Commission without restrictions concerning confidentiality. The Commission
rules on security shall apply regarding classified information.
Title II
RULES FOR THE PARTICIPATION
Chapter I
GENERAL PROVISIONS 
Article 5
Forms of funding 
In accordance with
Article 10 of Regulation (EU) XX/2012 [Horizon 2020], funding may take one or
several of the forms of provided for by Regulation (EU) No XX/2012 [Financial
Regulation], in particular grants, prizes, procurement and financial
instruments. 
Article 6
Legal entities that may participate in actions
1.                      
Any legal entity regardless of its place of
establishment and international organisations may participate in an action
provided that the conditions laid down in this Regulation have been met as well
as any conditions laid down in the relevant work programme or work plan.
2.                      
The relevant work programme may restrict the
participation in Horizon 2020 or parts thereof of legal entities established in
third countries where conditions for the participation of legal entities from
Member States in the third country’s research and innovation programmes are
considered prejudicial to the Union's interests. 
3.                      
The relevant work programme or work plan may
exclude entities not able to provide satisfactory security guarantees,
including as regards personnel security clearance if justified by security
reasons. 
4.                      
The JRC may participate in actions with the same
rights and obligations as a legal entity established in a Member State. 
Article 7
Independence
1.                      
Two legal entities shall be regarded as
independent of each other where neither is under the direct or indirect control
of the other or under the same direct or indirect control as the other.
2.                      
For the purposes of paragraph 1, control may, in
particular, take either of the following forms:
(a)         
the direct or indirect holding of more than 50 %
of the nominal value of the issued share capital in the legal entity concerned,
or of a majority of the voting rights of the shareholders or associates of that
entity;
(b)         
the direct or indirect holding, in fact or in
law, of decision making powers in the legal entity concerned.
3.                      
However, the following relationships between
legal entities shall not in themselves be deemed to constitute controlling
relationships:
(a)         
the same public investment corporation,
institutional investor or venture-capital company has a direct or indirect
holding of more than 50 % of the nominal value of the issued share capital or a
majority of voting rights of the shareholders or associates;
(b)         
the legal entities concerned are owned or
supervised by the same public body.
Chapter II
GRANTS
SECTION I
AWARD PROCEDURE
Article 8
Conditions for participation
1.                      
The following minimum conditions shall apply:
(a)         
at least three legal entities shall participate
in an action; 
(b)         
each of the three shall be established in a
Member State or associated country;
(c)         
no two of the three may be established in the
same Member State or associated country;
(d)         
all three legal entities shall be independent of
each other within the meaning of Article 7.
2.                      
For the purposes of paragraph 1, where one of
the participants is the JRC, or an international European interest organisation
or an entity created under Union law, it shall be deemed to be established in a
Member State or associated country other than any Member State or associated
country in which another participant in the same action is established. 
3.                      
By way of derogation from paragraph 1, in the
case of European Research Council (ERC) frontier research actions, the SME
instrument, programme co-fund actions and in justified cases provided for in the work programme or work
plan, the minimum condition shall be the participation of one legal entity
established in a Member State or associated country.
4.                      
By way of derogation from paragraph 1, in the
case of coordination and support actions and training and mobility actions, the
minimum condition shall be the participation of one legal entity.
5.                      
Work programmes or work plans may provide for
additional conditions according to specific policy requirements or to the
nature and objectives of the action, including inter alia conditions
regarding the number of participants, the type of participant and the place of
establishment.
Article 9
Eligibility for funding
1.                      
The following participants are eligible for funding
from the Union:
(a)         
any legal entity established in a Member State
or associated country, or created under Union law;
(b)         
any international European interest
organisation;
(c)         
any legal entity established in a third country
identified in the work programme.
2.                      
In the case of a participating international
organisation or in the case of a participating legal entity established in a
third country, neither of which are eligible for funding according to paragraph
1, funding from the Union may be granted provided that at least one of the
following conditions is fulfilled:
(a)         
the participation is deemed essential for
carrying out the action by the Commission or the relevant funding body;
(b)         
such funding is provided for under a bilateral
scientific and technological agreement or any other arrangement between the Union
and the international organisation or, for entities established in third
countries, the country in which the legal entity is established.
Article 10
Calls for proposals
Without prejudice to the other cases
provided for in Regulation (EU) No XX/2012 [Financial Regulation] and in Regulation
(EU) No XX/2012 [Delegated Regulation], calls for proposals shall not be issued
for coordination and support actions and programme co-fund actions to be
carried out by legal entities identified in the work programmes provided that
the action does not fall under the scope of a call for proposals.
Article 11
Joint calls with third countries or with international organisations
1.                      
Joint calls for proposals with third countries
or their scientific and technological organisations and agencies or with
international organisations may be launched to jointly fund actions. Proposals
shall be evaluated and selected through joint evaluation and selection
procedures to be agreed upon. Such evaluation and selection procedures shall
ensure compliance with the principles set out in Title VI of Regulation (EU) XX/2012
[Financial Regulation] and involve a balanced group of independent experts appointed
by each party.
2.                      
Legal entities receiving funding from the Union
shall conclude a grant agreement with the Union or the relevant funding body.
That grant agreement shall include the description of work to be done by those
participants and by the participating legal entities from the third countries
involved.
3.                      
Legal entities receiving funding from the Union
shall conclude a coordination agreement with the participating legal entities
receiving funding from the relevant third countries or international
organisations.
Article 12
Proposals
1.                      
Where appropriate, proposals shall include a
draft plan for the exploitation and dissemination of the results.
2.                      
Any proposal for research on human embryonic
stem cells shall include, as appropriate, details of licensing and control
measures that will be taken by the competent authorities of the Member States
as well as details of the ethical approvals that will be provided. As regards
the derivation of human embryonic stem cells, institutions, organisations and
researchers shall be subject to strict licensing and control in accordance with
the legal framework of the Member States involved.
3.                      
A proposal which contravenes ethical principles
or any applicable legislation, or which does not fulfil the conditions set out
in Decision No XX/XX/EU [specific programme], the work programme or work plan or
in the call for proposals may be excluded from the evaluation, selection and
award procedures at any time.
Article 13
Ethics
review
The Commission shall systematically carry
out ethics reviews for proposals raising ethical issues. This review shall
verify the respect of ethical principles and legislation and, in the case of
research carried out outside the Union, that the same research would have been allowed
in a Member State.
Article 14
Selection and award criteria 
1.                      
The proposals submitted shall be evaluated on
the basis of the following award criteria:
(a)          
excellence;
(b)         
impact;
(c)          
quality and efficiency of the implementation.
2.                      
The sole criterion of excellence shall apply for
proposals for ERC frontier research actions.
3.                      
The work programme or work plan shall lay down
further details of the application of the award criteria laid down in paragraph
1, and specify weightings and thresholds.
4.                      
Proposals shall be ranked according to the
evaluation results. The selection shall be made on the basis of this ranking. 
5.                      
The Commission or the relevant funding body
shall verify the financial capacity in advance only for coordinators when the
requested funding from the Union for the action is equal or superior to EUR 500
000, unless where, on the basis of available information, there are grounds to
doubt the financial capacity of the coordinator or other participants. 
6.                      
The financial capacity shall not be verified for
legal entities whose viability is guaranteed by a Member State or an associated
country and for higher and secondary education establishments.
Article 15
Evaluation review procedure
1.                      
The Commission or the relevant funding body shall
provide an evaluation review procedure for applicants who consider that the
evaluation of their proposal has not been carried out in accordance with the
procedures set out in these rules, the relevant work programme or work plan and
the call for proposals.
2.                      
A request for review shall relate to a specific
proposal, and shall be submitted by the coordinator of the proposal within 30
days of the date when the Commission or the relevant funding body informs the coordinator
of the evaluation results.
3.                      
The Commission or the relevant funding body shall
be responsible for the examination of this request. This examination shall only
cover the procedural aspects of the evaluation, and not the merit of the
proposal.
4.                      
An evaluation review committee composed of Commission
staff or of the relevant funding body staff shall provide an opinion on the procedural
aspects of the evaluation process. It shall be chaired by an official of the
Commission or of the relevant funding body, from a department other than the
one responsible for the call for proposals. The committee may recommend one of
the following:
(a)         
re-evaluation of the proposal; 
(b)         
confirmation of the initial opinion.
5.                      
On the basis of that recommendation a decision
shall be taken by the Commission or the relevant funding body and notified to
the coordinator of the proposal.
6.                      
The review procedure shall not delay the
selection process of proposals which are not the subject of requests for
review.
7.                      
The review procedure shall not preclude any
other actions the participant may take in accordance with Union law.
Article 16
Grant agreement
1.                      
The Commission or the relevant funding body
shall enter into a grant agreement with the participants. 
2.                      
The grant agreement shall establish the rights
and obligations of the participants, of the Commission or the relevant funding
bodies. It shall also establish the rights and obligations of legal entities which
become participants during the implementation of the action.
3.                      
The grant agreement may establish rights and
obligations of the participants with regard to access rights, exploitation and
dissemination, additional to those laid down in this Regulation. 
4.                      
The grant agreement shall, where appropriate,
reflect the general principles laid down in Commission Recommendation on the
European Charter for Researchers and the Code of Conduct for the Recruitment of
Researchers[18].
5.                      
The grant agreement shall, where appropriate,
contain provisions ensuring the respect of ethical principles, including the establishment
of an independent ethics board and the right of the Commission to carry out an
ethics audit.
6.                      
Specific grants for actions may form part of a framework
partnership according to the provisions of Regulation (EU) No XX/2012 [the
Financial Regulation] and Regulation (EU) No [the Delegated Regulation].
Article 17
Grant decisions
Where appropriate the Commission, in
accordance with Article X of Regulation (EU) No XX/2012 [Financial Regulation],
or the relevant funding body may adopt grant decisions instead of entering into
grant agreements. The provisions of this Regulation referring to grant agreements
shall apply mutatis mutandis.
Article 18
Secure electronic system
The Commission or the relevant funding body
may establish a secure electronic system for exchanges with the participants. A
document submitted by means of this system, including grant agreements, shall
be deemed to be the original of that document where the user identification and
password of the participant's representative have been used. Such
identification shall constitute the signature of the document concerned.
SECTION II
IMPLEMENTATION
Article 19
Implementation of the action
1.                      
The participants shall implement the action in
compliance with all the conditions and obligations set out in this Regulation, Regulation
(EU) No XX/2012 [Financial Regulation], Regulation (EU) No [the Delegated
Regulation], Decision (EU) No XX/XX [the specific programme], the work
programme or work plan, the call for proposals and the grant agreement. 
2.                      
Participants shall make no commitments which are
incompatible with the grant agreement. Where a participant fails to comply with
its obligations regarding the technical implementation of the action, the other
participants shall comply with the obligations without any additional Union
funding unless the Commission or funding body expressly relieves them of that obligation.
The financial responsibility of each participant shall be limited to its own
debt, subject to the provisions relating to the Fund. The participants shall
ensure that the Commission or funding body is informed of any event which might
affect the implementation of the action or the interests of the Union.
3.                      
The participants shall implement the action and
shall take all necessary and reasonable measures to that end. They shall have
the appropriate resources as and when needed for carrying out the action. Where
it is necessary for the implementation of the action, they may call upon third
parties, including subcontractors, to carry out certain elements of the action
or may use resources made available by third parties by means of contributions
in kind according to the conditions set out in the grant agreement. The
participant shall retain sole responsibility towards the Commission or the
relevant funding body and towards the other participants for the work carried
out.
4.                      
The award of subcontracts for carrying out
certain elements of the action shall be limited to the cases provided for in
the grant agreement.
5.                      
Third parties other than subcontractors may
carry out part of a participant's work under the action, provided that the
third party and the work to be carried out by it are identified in the grant
agreement.
Costs incurred by these third parties may be deemed
eligible if the third party meets all the following conditions:
(a)         
it is eligible for funding if it were a
participant;
(b)         
it is an affiliated entity or has a link to a
participant in the framework of a legal structure covering a collaboration not
limited to the project;
(c)         
it is identified in the grant agreement; 
(d)         
it abides by the rules applicable to the
participant under the grant agreement with regard to eligibility of costs and
control of expenditure.
6.                      
Third parties may also make available resources
to a participant by means of contributions in kind to the action. Costs
incurred by third parties in relation to their in-kind contributions which are
made free of charge are eligible for funding provided they meet the conditions
established in the grant agreement.
7.                      
The action may involve financial support to
third parties under the conditions established in Regulation (EU) No XX/2012 [Financial
Regulation] and Regulation (EU) No XX/2012 [Delegated Regulation]. The amounts
referred to in Article [127(2)(c)] of Regulation (EU) XX/2012 [the Financial
Regulation] may be exceeded where it is necessary to achieve the objectives of
an action.
8.                      
The action carried out by participants which are
contracting authorities within the meaning of Directives 2004/17/EC[19], 2004/18/EC[20] and 2009/81/EC[21] of the European Parliament and
of the Council may involve or have as primary aim pre-commercial procurement
and procurement of innovative solutions, where provided for in a work programme
or a work plan and required for its implementation. In such a case, the rules set
out in Article 35(2) and in Article 49(2) and (3) shall apply to the
procurement procedures carried out by the participants.
9.                      
Participants shall comply with national
legislation, regulations and ethical rules in the countries where the action will
be carried out. Where appropriate, participants shall seek the approval of the
relevant national or local ethics committees prior to the start of the action.
10.                  
Work using animals shall be carried out in
accordance with Article 13 TFEU and shall comply with the requirement to
replace, reduce and refine the use of animals for scientific purposes in
accordance with Union legislation and in particular with Directive 2010/63/EU of
the European Parliament and the Council[22].
Article 20
Consortium
1.                      
The members of any consortium wishing to
participate in an action shall appoint one of them to act as coordinator which
shall be identified in the grant agreement.
2.                      
The members of a consortium participating in an
action shall conclude an internal agreement (the consortium agreement), except in
duly justified cases provided for in the work programme or work plan or call
for proposals.
3.                      
The consortium may propose to add or remove a participant
in accordance with the respective provisions of the grant agreement, provided that
this change is in conformity with the conditions for participation, does not adversely
affect the implementation of the action and is not contrary to the principle of
equal treatment.
SECTION III
FORMS OF GRANTS AND FUNDING RULES 
Article 21
Forms of grants
Grants may take any of the forms provided
for in Article [116] of Regulation (EU) No XX/2012 [the Financial Regulation].
Article 22
Funding
of the action
1.                      
The funding for an action shall not exceed the
total eligible costs minus the receipts of the action.
2.                      
The following shall be considered as receipts of
the action:
(a)         
Resources made available by third parties to the
participants by means of financial transfers or contributions in kind free of
charge, provided that they have been contributed by the third party
specifically to be used in the action;
(b)         
Income generated by the action, except income
generated by the exploitation of the results of the action; 
(c)         
Income generated from the sale of assets
purchased under the grant agreement up to the value of the cost initially
charged to the action by the participant.
3.                      
A single reimbursement rate of the eligible
costs shall be applied per action for all activities funded therein. The maximum
rate shall be fixed in the work programme or work plan.
4.                      
The Horizon 2020 grant may reach a maximum of
100 % of the total eligible costs, without prejudice to the co-financing
principle.
5.                      
The Horizon 2020 grant shall be limited to a
maximum of 70 % of the total eligible costs for the following actions:
(a)         
actions primarily consisting of activities such
as prototyping, testing, demonstrating, experimental development, piloting,
market replication;
(b)         
programme co-fund actions.
6.                      
The reimbursement rates determined in this
Article shall also apply in the case of actions where flat rate, scale of unit
or lump-sum financing is fixed for the whole or part of an action.
Article 23
Eligibility of costs
1.                      
Conditions for eligibility of costs are defined
in Article X of Regulation (EU) No xx [the Financial Regulation/Delegated
Regulation]. Costs incurred by third parties under the action may be eligible
according to the provisions of this Regulation and of the grant agreement. 
2.                      
Ineligible costs are those not complying with
the above conditions in particular provisions for possible future losses or
charges, exchange losses, costs related to return on capital, costs reimbursed
in respect of another Union action or programme, debt and debt service charges
and excessive or reckless expenditure.
Article 24
Indirect costs
1.                      
Indirect eligible costs shall be determined by applying
a flat rate of 20% of the total direct eligible costs, excluding direct
eligible costs for subcontracting and the costs of resources made available by
third parties which are not used on the premises of the beneficiary, as well as
financial support to third parties. 
2.                      
By way of derogation from paragraph 1, indirect
costs may be declared in the form of a lump sum or scale of unit costs when
provided for in the work programme or work plan. 
Article 25
Annual productive hours
1.                      
Eligible personnel costs shall only cover the
actual hours worked by the persons directly carrying out work under the action. The evidence regarding the actual hours
worked shall be provided by the participant, normally through a time recording
system.
2.                      
For persons working exclusively for the action,
no time recording is required. In such cases, the participant shall sign a
declaration confirming that the person concerned has worked exclusively for the
action.
3.                      
The grant agreement shall contain the minimum
requirements for the time recording system as well as the number of annual
productive hours to be used for the calculation of the hourly personnel rates.
Article 26
Personnel costs of the owners of
small and medium-sized enterprises and natural persons without salary
The owners of small and medium-sized enterprises
who do not receive a salary and other natural persons who do not receive a
salary may charge personnel costs on the basis of a scale of unit cost.
Article 27
Scales
of unit costs
1.                      
In accordance with Article X of Regulation (EU) No
XX/XX [financial regulation], the Commission may establish methods to determine
scales of unit costs based on:
(a)         
statistical data or similar objective means;
(b)         
auditable historical data of the participant. 
2.                      
Direct eligible personnel costs may be financed
on the basis of scale of unit costs determined according to the participant's
usual cost accounting practices, provided that they comply with the following
cumulative criteria:
(a)         
they are calculated on the basis of the total
actual personnel costs recorded in the participant's general accounts which may
be adjusted on the basis of budgeted or estimated elements according to the
conditions defined by the Commission;
(b)         
they comply with the provisions in Article 23;
(c)         
they ensure compliance with the non-profit
requirement and avoidance of double funding of costs;
(d)         
they are calculated with due regard to the
provisions on productive hours in Article 25.
Article 28
Certificate on the financial
statements
The certificate on financial statements shall
cover the total amount of the grant claimed by a participant under the form of
reimbursement of actual costs and under the form of scale of unit costs referred
to Article 27(2). The certificate shall only be submitted when that amount is
equal to or greater than EUR 325 000 at the time of claiming the payment of the
balance of the grant.
Article 29
Certificates on the methodology
1.                      
Participants that calculate and claim direct
personnel costs on the basis of scale of unit costs may submit to the
Commission a certificate on the methodology. That methodology shall comply with
the conditions set out in Article 27(2) and meet the requirements of grant
agreement.
2.                      
Where the Commission accepts a certificate on the
methodology, it shall be valid for all actions financed under Regulation (EU)
No XX/XX [Horizon 2020] and the participant shall calculate and claim costs on
its basis.
Article 30
Certifying auditors
1.                      
The certificates on the financial statements and
on the methodology referred to in Articles 28 and 29 shall be established by an
independent auditor qualified to carry out statutory audits of accounting
documents in accordance with Directive 2006/43/EC of the European Parliament
and of the Council[23]
or similar national regulations or by a competent and independent public
officer for whom the relevant national authorities have established the legal
capacity to audit the participant and who has not been involved in the preparation
of the financial statements.
2.                      
Upon request by the Commission, the Court of
Auditors or the European Anti-fraud Office (OLAF), the auditor who delivers the
certificate on the financial statements and on the methodology shall grant
access to the supporting documents and audit working papers on the basis of
which a certificate on the financial statements was issued.
Article 31
Cumulative funding
An action for which a grant from the Union
budget has been awarded may also give rise to the award of a grant on the basis
of Regulation (EU) No XX/XX [Horizon 2020] provided that the grants do not
cover the same cost items.
SECTION IV
GUARANTEES 
Article 32
Participant Guarantee Fund
1.                      
A participant guarantee fund ("the
Fund") is hereby established and shall cover the risk associated with
non-recovery of sums due to the Union under actions financed through grants by
the Commission under Decision No 1982/2006/EC and by the Commission or Union
bodies under "Horizon 2020" according to the Rules set out in this
Regulation. The Fund shall replace and succeed the Participant Guarantee Fund
set up under Regulation (EC) No 1906/2006.
2.                      
The Fund shall be operated in accordance with
Article 33. Financial interest generated by the Fund shall be added to the Fund
and shall serve exclusively for the purposes set out in Article 33(3).
3.                      
Where interest is insufficient to cover the operations
described in Article 33(3) the Fund shall not intervene and the Commission or
the relevant Union funding body shall recover directly from beneficiaries
any amount owed.
4.                      
The Fund shall be considered as a sufficient
guarantee under Regulation (EU) No XX/XX [the Financial Regulation]. No
additional guarantee or security may be accepted from participants or imposed
on them except in the case described in paragraph 3.
5.                      
The participants in actions under Horizon 2020
whose risk is covered by the Fund shall make a contribution of 5 % of the Union
funding for the action. At the end of the action the amount contributed to the
Fund shall be returned to the participants, via the coordinator.
Article 33
Operation of the Fund
1.                      
The Fund shall be managed by the Union
represented by the Commission acting as executive agent on behalf of the
participants, according to the conditions established by the grant agreement.
The Commission may manage the Fund directly or
entrust the financial management of the Fund either to the European Investment
Bank or to an appropriate financial institution (the depository bank). The
depository bank shall manage the Fund pursuant to the instructions of the
Commission.
2.                      
The participants' contribution to the Fund may
be offset from the initial pre-financing and be paid to the Fund on behalf of
the participants.
3.                      
Where amounts are due to the Union by a participant
the Commission may, without prejudice to penalties which may be imposed on the
defaulting participant, take either of the following actions:
(a)         
transfer or order the depository bank to
transfer directly the amount due from the Fund to the coordinator of the action.
That transfer shall be made after the termination or withdrawal of the
participation of the defaulting participant if the action is still ongoing and
if the remaining participants agree to implement it according to the same
objectives. Amounts transferred from the Fund shall be regarded as Union
funding; 
(b)         
recover effectively that amount from the Fund.
The Commission shall issue a recovery order
against that participant to the benefit of the Fund. The Commission may adopt
to that end a recovery decision in accordance with Regulation (EU) No XX/XX
[the Financial Regulation].
4.                      
The amounts recovered shall constitute revenue
assigned to the Fund within the meaning of Article X of Regulation (EU) No
XX/2012 [the Financial Regulation]. Once the implementation of all grants whose
risk is covered by the Fund is complete, any sums outstanding shall be
recovered by the Commission and entered into the budget of the Union, subject
to decisions of the legislative authority.
Chapter IV
PRIZES, PROCUREMENT AND FINANCIAL INSTRUMENTS
Article 34
Prizes
Union funding may take the form of prizes
as defined in Title VII of Regulation (EU) No XX/XX [Financial Regulation].
Article 35
Procurement, pre-commercial procurement
and public procurement of innovative solutions
1.                      
Any procurement carried out by the Commission on
its own behalf or jointly with Member States shall be subject to the rules on
public procurement as set out in Regulation (EU) No xx/2012 [Financial
Regulation] and Regulation (EU) No XX/XX [the Delegated Regulation].
2.                      
Union funding may take the form of
pre-commercial procurement or procurement of innovative solutions carried out
by the Commission or the relevant funding body on its own behalf or jointly
with contracting authorities from Member States and associated countries.
The procurement
procedures:
(a)         
shall comply with the principles of
transparency, non-discrimination, equal treatment, sound financial management,
proportionality, and with competition rules and, where applicable, with
Directives 2004/17/EC, 2004/18/EC and 2009/81/EC, or, where the Commission acts
on its own behalf, with Regulation (EU) No XX/2012 [the Financial Regulation];
(b)         
may provide for specific conditions such as the
place of performance of the procured activities being limited for pre-commercial procurement
to the territory of the Member States and of countries associated to Horizon
2020 where duly justified by the objectives of the
actions; 
(c)         
may authorise the award of multiple contracts
within the same procedure (multiple sourcing);
(d)         
shall provide for the award of the contracts to
the tender(s) offering best value for money.
Article 36
Financial instruments
1.                      
Financial instruments may take any of the forms
referred to in and shall be implemented in accordance with [Title VIII] of
Regulation (EU) No XX/XX [the Financial Regulation] and may be combined with
grants funded under the Union budget, including under Horizon 2020.
2.                      
In accordance with Article [18(2)] of Regulation
(EU) No XX/XX [the Financial Regulation], revenues and repayments generated by
a financial instrument set up under Regulation (EU) No XX/XX [Horizon 2020]
shall be assigned to that financial instrument.
3.                      
Revenues and repayments generated by the
Risk-Sharing Finance facility set up under Decision No 1982/2006/EC and the early
stage part of the High-Growth and Innovative SME Facility (GIF1) set up under
the Decision No 1639/2006/EC of the European Parliament and of the Council[24], shall be assigned to the
succeeding financial instruments under Regulation (EU) No XX/XX [Horizon 2020].
Chapter VII
EXPERTS
Article 37
Appointment
of independent experts
1.                      
The Commission and, where appropriate, funding
bodies may appoint independent experts to evaluate proposals or to advise on or
assist with:
(a)         
the evaluation of proposals;
(b)         
the monitoring of the implementation of actions
carried out under Regulation (EU) No XX/XX [Horizon 2020] as well as of
previous Research and/or Innovation Programmes;
(c)         
the implementation of Union research and
innovation policy or programmes including Horizon 2020, as well as with the achievement
and functioning of the European Research Area;
(d)         
the evaluation of Research and Innovation
Programmes;
(e)         
the design of the Union research and innovation
policy including the preparation of future programmes.
2.                      
Independent experts shall be chosen on the basis
of skills, experience and knowledge appropriate to carry out the tasks assigned
to them. In cases where independent experts have to deal with classified
information, the appropriate security clearance shall be required before
appointment.
Independent experts shall be identified and
selected on the basis of calls for applications from individuals and calls
addressed to relevant organisations such as national research agencies,
research institutions, standardisation organisations or enterprises with a view
to establishing a database of candidates.
The Commission or the relevant funding body
may, if deemed appropriate and in duly justified cases, select any individual
with the appropriate skills from outside the database.
Appropriate measures shall be taken to seek gender
balance and geographical diversity when appointing independent experts.
The Commission or the relevant funding body may
call upon the advice of advisory bodies for the appointment of independent
experts. In the case of ERC frontier research actions, the Commission shall
appoint experts on the basis of a proposal from the Scientific Council of the ERC.
3.                      
The Commission or the relevant funding body
shall take all necessary steps to ensure that the expert is not faced with a
conflict of interests in relation to the matter on which the expert is required
to provide an opinion.
4.                      
The appointment of the experts may take the form
of a framework appointment valid for the entire duration of Horizon 2020 with specific
assignments of tasks.
5.                      
The names of experts appointed in a personal
capacity, who have assisted the Commission or the funding bodies in
implementation of Regulation (EU) No XX/XX Horizon 2020 and Decision No
XX/XX/EU [the specific programme], shall be published at least once a year on
the Internet site of the Commission or the funding body. The names of experts
shall be collected, processed and published in accordance with Regulation (EC)
No 45/2001.
Title III
RULES GOVERNING DISSEMINATION OF RESULTS
Chapter I
GRANTS 
SECTION I
RESULTS
Article 38
Ownership of results
1.                      
Results shall be owned by the participant
generating these results.
2.                      
Where participants in an action have jointly
generated results and where their respective share of the work cannot be
ascertained, they shall have joint ownership of those results. The joint owners
shall establish an agreement regarding the allocation and terms of exercise of
that joint ownership in accordance with their obligations under the grant
agreement.
Unless otherwise agreed in the joint ownership
agreement, each joint owner shall be entitled to grant non-exclusive licences
to third parties to exploit the jointly owned results, without any right to
sub-licence, subject to the following conditions:
(a)         
prior notice shall be given to the other joint
owners;
(b)         
fair and reasonable compensation shall be
provided to the other joint owners.
3.                      
If employees or any party working for a
participant are entitled to claim rights to the results generated, the
participant concerned shall ensure that it is possible to exercise these rights
in a manner compatible with its obligations under the grant agreement.
Article 39
Protection of results
1.                      
Where results are capable of commercial or
industrial application, the participant owning these results shall examine the
possibility for protection and, if possible and justified given the
circumstances, shall adequately protect them for an appropriate period of time
and with an appropriate territorial coverage, having due regard to its
legitimate interests and the legitimate interests, particularly the commercial
interests, of the other participants in the action.
2.                      
Where a participant that has received Union
funding intends not to protect results generated by it for reasons other than impossibility
under Union or national law or the lack of potential for commercial exploitation,
and unless the participant intends to transfer them to another legal entity
established in a Member State or associated country in view of their
protection, it shall inform the Commission or funding body before any
dissemination relating to these results takes place. The Commission on behalf
of the Union or the funding body may assume ownership of these results and take
the necessary steps for their adequate protection.
The participant may refuse consent only if it
demonstrates that its legitimate interests would suffer significant harm. No
dissemination relating to these results may take place until the Commission or
the funding body has taken a decision or has decided that it will assume
ownership and has taken the necessary steps to ensure protection. The grant
agreement shall lay down time-limits in this respect.
3.                      
Where a participant that has received Union funding
intends to abandon the protection of results or not to seek extension of such
protection for reasons other than the lack of potential for commercial
exploitation, it shall inform the Commission or the funding body which may
continue or extend protection by assuming ownership thereof. The participant
may refuse consent only if it demonstrates that its legitimate interests would
suffer significant harm. The grant agreement shall lay down time-limits in this
respect.
Article 40
Exploitation and dissemination of
results
1.                      
Each participant that has received Union funding
shall use its best efforts to exploit the results it owns in further research or
commercially, or to have them exploited by another legal entity for these
purposes, in particular through transfer and licensing of results in accordance
with Article 41.
Additional exploitation obligations may be laid
down in the grant agreement. Any such additional obligations shall be indicated
in the work programme or work plan.
2.                      
Subject to any restrictions due to the
protection of intellectual property, security rules or legitimate commercial
interests, each participant shall through appropriate means disseminate the
results it owns as soon as possible. The grant agreement may lay down
time-limits in this respect. 
Additional dissemination obligations may be
laid down in the grant agreement.
With regard to dissemination through research
publications, open access shall apply under the terms and conditions laid down
in the grant agreement. With regard to dissemination of other results,
including research data, the grant agreement may lay down the terms and
conditions under which open access to such results shall be provided, in
particular in ERC frontier research or in other appropriate areas.
Prior notice of any dissemination activity
shall be given to the other participants. Following notification, a participant
may object if it demonstrates that its legitimate interests in relation to its
results or background would suffer significant harm by the intended
dissemination. In such cases, the dissemination activity may not take place
unless appropriate steps are taken to safeguard these legitimate interests. The
grant agreement may lay down time-limits in this respect.
3.                      
Each participant shall report to the Commission
or funding body on its exploitation and dissemination related activities. For the
purposes of monitoring and dissemination by the Commission or funding body, participants
shall provide any information and documents useful in accordance with the
conditions laid down in the grant agreement.
4.                      
All patent applications, standards, publications
or any other dissemination, also in electronic form, relating to results shall
include a statement, which may include visual means, that the action received
financial support from the Union. The terms of that statement shall be
established in the grant agreement.
Article 41
Transfer and licensing of results
1.                      
Where a participant transfers ownership of
results, it shall pass on its obligations under the grant agreement regarding
those results to the transferee, including the obligation to pass them on in
any subsequent transfer. 
Without prejudice to confidentiality obligations
arising from laws or regulations in the case of mergers and acquisitions, where
other participants still enjoy access rights to the results to be transferred,
the participant who intends to transfer the results shall give prior notice to
those other participants, together with sufficient information concerning the
intended new owner of the results to permit the other participants to analyse
the effect of the intended transfer on the possible exercise of their access
rights.
Following notification, a participant may
object to the transfer of ownership if it demonstrates that the intended
transfer would adversely affect the exercise of its access rights. In such
case, the transfer may not take place until agreement has been reached between
the participants concerned. The grant agreement may lay down
time-limits. 
The other participants may by prior written
agreement, waive their right to prior notice and to object in the case of
transfers of ownership from one participant to a specifically identified third
party.
2.                      
Provided that any access rights to the results
can be exercised and that any additional exploitation obligations are complied
with, the participant who owns results may grant licences or otherwise give the
right to exploit them to any legal entity, including on an exclusive basis.
3.                      
With regard to results which are generated by
participants that have received Union funding, the Commission or funding body
may object to transfers of ownership or to grants of an exclusive licence, to
third parties established in a third country not associated to Horizon 2020, if
it considers that the grant or transfer is not in accordance with the interests
of developing the competitiveness of the Union economy or is inconsistent with
ethical principles or security considerations.
In such cases, the transfer of ownership or
grant of exclusive licence shall not take place unless the Commission or
funding body is satisfied that appropriate safeguards will be put in place.
Where appropriate, the grant agreement shall
provide that the Commission or funding body is to be notified in advance of any
such transfer of ownership or grant of an exclusive licence. The grant
agreement shall lay down time-limits.
SECTION 2
ACCESS RIGHTS TO BACKGROUND AND RESULTS
Article 42
Background
Participants shall identify the background
for their action in any manner in a written agreement.
Article 43
Access rights principles
1.                      
Any request to exercise access rights or any
waiving of access rights shall be made in writing.
2.                      
Unless otherwise agreed by the owner of the
results or background to which access is requested, access rights shall not
include the right to sub-licence.
3.                      
Participants in the same action shall inform
each other before their accession to the grant agreement of any legal
restriction or limit to granting access to their background. Any agreement
concluded thereafter by a participant regarding background shall ensure that
any access rights may be exercised.
4.                      
For the purposes of access rights, fair and
reasonable conditions may be royalty-free conditions.
5.                      
The termination of the participation in an
action shall not affect the obligation of such a participant to grant access
under the terms and conditions established in the grant agreement. 
6.                      
Where a participant defaults on its obligations
and such default is not remedied, the consortium agreement may stipulate that
such a participant shall no longer enjoy access rights.
Article 44
Access
rights for implementation
1.                      
A participant shall enjoy access rights to the
results of another participant in the same action, if such access is needed by
the former to carry out its work under the action.
Such access shall be granted on a royalty-free
basis.
2.                      
A participant shall enjoy access rights to
background of another participant in the same action, if such access is needed by
the former to carry out its work under the action and subject to any
restrictions pursuant to Article 43(3).
Such access shall be granted on a royalty-free
basis, unless otherwise agreed by the participants before their accession to
the grant agreement.
Article 45
Access rights for exploitation
1.                      
A participant shall enjoy access rights to the
results of another participant in the same action, if such access is needed by
the former to exploit its results.
Subject to agreement, such access shall be
granted under fair and reasonable conditions.
2.                      
A participant shall enjoy access rights to
background of another participant in the same action, if such access is needed
by the former to exploit its results and subject to any restrictions or limits
pursuant to Article 43(3). 
Subject to agreement, such access shall be
granted under fair and reasonable conditions.
3.                      
An affiliated entity established in a Member
State or associated country shall, unless otherwise provided for in the
consortium agreement, also have access rights to results or background under
the same conditions if such access is needed to exploit the results generated by
the participant to which it is affiliated. 
4.                      
A request for access under paragraphs 1, 2 and 3
may be made up to one year after the end of the action. However, the
participants may agree on a different time-limit.
Article 46
Access rights for the Union and the
Member States
1.                      
The Union institutions and bodies shall, for the
purpose of developing, implementing and monitoring Union policies or
programmes, enjoy access rights to the results of a participant that has
received Union funding. Such access rights are limited to non-commercial and
non-competitive use.
Such access shall be granted on a royalty-free
basis.
2.                      
Regarding actions in the activity 'Secure
societies' within the specific objective 'Inclusive, innovative and secure
societies', the Union institutions and bodies as well as Member States'
national authorities shall, for the purpose of developing, implementing and
monitoring their policies or programmes in this area, enjoy access rights to
the results of a participant that has received Union funding. Notwithstanding
Article 43(2), such access rights shall include the right to authorise third
parties to use the results in public procurement in the case of the development
of capabilities in domains with very limited market size and a risk of market
failure, and where a predominant public interest exists.
Such access shall be granted on a royalty-free
basis, except for use in public procurement where it shall be granted on fair
and reasonable conditions to be agreed upon. The Union funding received in
generating the results shall be fully taken into account in the determination
of the fair and reasonable conditions. The Commission rules on security shall
apply regarding classified information.
SECTION 3
SPECIFIC CASES
Article 47
Specific provisions
1.                      
In the case of actions involving
security-related activities, the grant agreement may lay down specific
provisions, in particular on changes to the consortium's composition,
classified information, exploitation, dissemination, transfers and licences of
results.
2.                      
In the case of actions to support existing or
new research infrastructures, the grant agreement may lay down specific
provisions relating to users of the infrastructure.
3.                      
In the case of ERC frontier research actions,
the grant agreement may lay down specific provisions, in particular on access
rights, portability and dissemination, relating to participants, researchers and
any party concerned by the action.
4.                      
In the case of training and mobility actions,
the grant agreement may lay down specific provisions on commitments relating to
the researchers benefiting from the action, ownership, access rights and portability.
5.                      
In the case of coordination and support actions,
the grant agreement may lay down specific provisions, in particular on
ownership, access rights, exploitation and dissemination.
6.                      
In the case of the SME instrument and grants by
funding bodies targeting SMEs, the grant agreement may lay down specific provisions,
in particular on ownership, access rights, exploitation and dissemination.
7.                      
In the case of the Knowledge and Innovation
Communities of the EIT, the grant agreement may lay down specific provisions,
in particular on ownership, access rights, exploitation and dissemination.
CHAPTER II
PRIZES AND PROCUREMENT
Article 48
Prizes
Any prize awarded shall be conditional on
the acceptance of the appropriate publicity obligations. The work programme or
work plan may contain specific obligations regarding exploitation and
dissemination.
Article 49
Procurement, pre-commercial
procurement 
and public procurement of innovative solutions
1.                      
Unless otherwise stipulated in the call for
tenders, results generated by procurement carried out by the Commission shall
be owned by the Union.
2.                      
Specific provisions regarding ownership, access
rights and licensing shall be laid down in the contracts regarding
pre-commercial procurement to ensure maximum uptake of the results and to avoid
any unfair advantage. The contractor generating results in pre-commercial
procurement shall own at least the attached intellectual property rights. The
contracting authorities shall enjoy at least royalty-free access rights to the
results for their own use as well as the right to grant, or require the
participating contractors to grant, non-exclusive licences to third parties to
exploit the results under fair and reasonable conditions without any right to
sub-licence. If a contractor fails to commercially exploit the results within a
given period after the pre-commercial procurement as identified in the contract,
it shall transfer any ownership of the results to the contracting authorities.
3.                      
Specific provisions regarding ownership, access
rights and licensing may be laid down in the contracts regarding public
procurement of innovative solutions to ensure maximum uptake of the results and
to avoid any unfair advantage.
TITLE IV
FINAL PROVISIONS
Article 50
Repeal and transitional provisions
1.                      
Regulation (EC) No 1906/2006 is repealed with
effect from 1 January 2014.
2.                      
Without prejudice to paragraph 1, this
Regulation shall not affect the continuation or modification, including the
total or partial termination of the actions concerned, until their closure, or
the award of financial assistance by the Commission or funding bodies under Decision
No 1982/2006/EC, or any other legislation applying to that assistance on 31
December 2013, which shall continue to apply to the actions concerned until
their closure.
3.                      
Any sums from the participant Guarantee Fund set
up by Regulation (EC) No 1906/2006 as well as all its rights and obligations
shall be transferred to the Fund as of 31 December 2013. The participants in
actions under the Seventh Framework Programme signing grant agreements after 31
December 2013 shall make their contribution to the Fund.
Article 51
This Regulation shall enter into force on
the third day following that of its publication in the Official Journal of
the European Union.
This Regulation shall be binding
in its entirety and directly applicable in all Member States.
Done at Brussels,
For the European Parliament                       For
the Council
The President                                                 The
President
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[2]               OJ L, , p.
[3]               OJ
C , , p. .
[4]               OJ
C , , p. .
[5]               OJ C , , p. .
[6]               COM (2010) 546 final, 6.10.2010.
[7]               Report of the Committee on Industry, Research and
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[8]               OJ L 412, 30.12.2006, p.1.
[9]               COM (2010) 187.
[10]               COM (2011) 48.
[11]               OJ L, , p.
[12]             OJ L, , p
[13]             OJ L 317, 3.12.2001, as amended
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[14]             OJ L 391, 30.12.2006, p.1.
[15]             OJ L 54, 22.2.2007, p. 21
[16]             OJ L…
[17]             OJ L 8, 12.1.2001, p. 1.
[18]             C(2005) 576 final, 11.3.2005
[19]             OJ L 134, 30.4.2004, p. 1.
[20]             OJ L 134, 30.4.2004, p. 114.
[21]             OJ L 216, 20.8.2009, p. 76.
[22]             OJ L 276, 20.10.2010,p.33.
[23]             OJ L 157, 09.06.2006, p.87.
[24]             OJ L 310, 9.11.2006, p. 15.