Petr CervenyUnit Administration and Finance

31/5/2010

Major FP7 Negotiation Issues

Goals of the presentation

1. To give guidance on majorFP7 negotiation administrative issues

2. To receive feedback onFP7 administrative issues

Overview of the presentation

1. Validation of new beneficiaries (PIC)2. & 3. & 4. Grant Preparation Forms (GPFs) (1) & (2) & (3)5. & 6. Prefinancing (1) & (2)7. Reporting periods8. Starting date of the project9. Consultants & Subcontracting10. Audit certificate11. Financial capacity check12. Grant Agreement signature process13. & 14. Important documents–CORDIS website (1) & (2)

1. Validation of new beneficiaries (PIC)

• Validation – fully validated PIC – is necessary:– for all new Beneficiaries– for Third Parties acting under special clause 10

(SC10)

• Validation is to be launched by Beneficiariesand Third Parties under SC 10 themselves

– by submitting legal validation documents to a special CORDIS website called the ‘Participant Portal’

(http://ec.europa.eu/research/participants/portal/ appmanager/participants/portal)

• Validation is NOT required for subcontractors

Not legally binding

2. Grant Preparation Forms (GPFs) (1)

• GPFs are to be filled on-line via NEF tool (Guidance available on CORDIS website)

• Original signed GPF Forms A2.5 needed(and A2.6 for the coordinator)

• Technical notice for budgetary GPF A3.2 Form:– Two critical budgetary figures

shall be without Eurocents: Total Project Cost and

Total Project EC Contribution

Not legally binding

3. Grant Preparation Forms (GPFs) (2)

• Indirect cost method – please check it carefully – one Indirect cost method per beneficiary is fixed for all its FP7 projects – in case of a mistake, it is necessary that LEAR contacts the central validation unit via the Participant Portal for a correction request & in copy email to Project Officer

• Banking account info (GPF A4 Form)for the coordinator only = Original of GPF A4 Form signed both by the coordinator and the bank,

or = Original of GPF A4 Form signed by the coordinator only

plus a copy of a bank statementNot legally binding

4. Grant Preparation Forms (GPFs) (3)

• LEAR = Legal Entity Appointed Representative (stated on GPF A2.1 Form, one for the legal entity) – LEAR is the organisation contact point for submission changes of legal data of the organisation on GPF A2.1 & A2.2 Forms via the Participant Portal (like name, address, VAT number, public body status, SME status, indirect cost method correction etc.)

• (Project) Authorised Representatives = GPF A2.3 Form – Authorised Representatives (max 2 per project) are the only persons that sign the Grant Agreement on behalf of the organisation – one organisation for different FP7 projects can have different Authorised Representatives

• (Project) Contact Persons = GPF A2.4 Form – Administrative and Scientific Contacts for operational project communication between the Commission and the organisation

Not legally binding

5. Prefinancing (1)

• Purpose of the prefinancing: to have a positive cash-flow for beneficiaries during (most of) the project

• Only one prefinancing for the project

• Subject to negotiation – Initial heavy investment = higher prefinancing – Lower starting expenditure = lower prefinancing – Indicative rule: – projects with 1–2 reporting periods: 60–80 % – projects with 3 reporting periods: 53,3 % – projects with 4 reporting periods: 40 %

Not legally binding

6. Prefinancing (2)

• Paid to the coordinateur usually within 14 days after the Commision signs the Grant Agreement

• Prefinancing amount paid to the consortium = Total prefinancing amount – 5 %of total EC contribution (for the Guarantee Fund)

• 5 % that is being transferred automaticallyby the Commission to the Guarantee Fundis paid back to the consortiumtogether with the final payment

Not legally binding

7. Reporting periods

• 18 months in generalwith residual periods between 6–17 months – room for more balanced periods e.g. 15+15 months

• For very large projects with EC contribution> 10 mil. EUR reporting periods of 12 months

Not legally binding

8. Starting date of the project

3 possibilities:

A) The first day of the month following the Commission signature of the Grant Agreement

B) A fixed starting day

– an official letter is needed from the coordinator with proper justification

C) The starting date can be notifiedby the coordinateur after the Commission signsthe Grant Agreement

Not legally binding

9. Consultants & Subcontracting

• Consultants can be either a) ‘in house’ – similar status like employees

b) ‘subcontractors’ – in all other cases

• Subcontractingnormally possible for non-core tasks only – every subcontracting must be detailed and justified in the Annex I – every subcontracting must be awarded to the bid offering the best value for money under conditions of transparency and equal treatment

Not legally binding

10. Audit certificate

• Audit certificate = Certificate on the financial statements

• Only applicable if beneficiary’s cumulative cost claim for EC contribution reaches 375.000 EUR

• If beneficiary’s cumulative cost claim for EC contribution does not reach the threshold 375.000 EUR, no certificate is needed

Not legally binding

11. Financial capacity check

• This check is done according to Commission Decision C(2007)/2466 (available on CORDIS):

a) for all private coordinators (regardless of their EC contribution)

b) for all private beneficiaries with EC contribution more than 500.000 EUR

• All concerned beneficiaries & coordinateurs receive a special email with all instructions

Not legally binding

12. Grant Agreement signature process

• First the coordinateur signs the Grant Agreement

• Then the Commission signs the Grant Agreement

• Finally, all beneficiaries sign ‘Form A’(one page, ‘accession’ to the Grant Agreement)

• The prefinancing can only be distributedto the beneficiaries that signed ‘Form A’

• Proof of signing the Consortium Agreement is needed before the Grant Agreement signature

Not legally binding

13. Important documents–CORDIS website (1) (http://cordis.europa.eu/fp7/find-doc_en.html)

• Structure of Annex I to the GA (version of Jan 2010)• NEF User’s Guide (2nd version of Dec 2008)• Negotiation Guidance Notes (2nd version of Jan 2009)

14. Important documents–CORDIS website (2) (http://cordis.europa.eu/fp7/find-doc_en.html)

• Guide to Financial Issues (2nd version of April 2009)• Annex II of the Grant Agreement (5th ver. of Dec 2009)• Amendments Guide for FP7 (version of Feb 2010)

Thank you for your attention!

Questions & Answers