CORDIS Archive : ISTweb | FAQs for Proposers involved in second call negotiations

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FAQs for Proposers involved in second call negotiations

Negotiations

Project preparation/negotiation costs:: The Commission does not fund the effort expended by the proposers in preparing the proposal or conducting the negotiations.
Bank account:: If he has not done so already, your coordinator must establish a Euro bank account for the project to support payment of funds. This must be based in an EU or Associated state.
Withdrawing participants:: One or more of the organisations which participated in your proposal may now wish to withdraw, while others are still willing to continue. The negotiating Commission Project Officer will judge, in the light of the evaluators' reports, whether the withdrawn participant was marginal to the proposed project (in which case negotiations may continue) or vital to the proposed project (in which case negotiations might be terminated, or may be suspended pending your finding an acceptable substitute).
"Hesitating" participants:: Partners who are not yet fully committed to the consortium should make up their minds quickly! A participant pulling out at the last minute could nullify all the negotiations up to that point and will jeopardise the contract for everyone.
Consortium agreements:: You should give the highest possible priority to completing your internal consortium agreements before the time of contract signature, since there will be little margin to allow for delay at that time.
Changes in consortium/workplan:: You may find it necessary now to propose changes in your workplan or your consortium due to changes in the market or other events which have occurred since you prepared the proposal. The Commission PO will consider these, but the evaluation result must in all cases be respected - if your revised workplan or consortium differs to the extent that the evaluation might have yielded a different result, the PO will stop the negotiation and advise you to re-submit at a later call.
Reduction of manpower effort/changes in other cost categories:: The Commission funding decision was based on a certain level of manpower, either the one you requested in your proposal or alternatively one recommended by the evaluators if they did not approve your suggestion. In either case it is essentially fixed to this figure. If during the negotiations you change your manpower requirement (or any other significant cost), the Commission funding offer will change.
Already started activities:: Normally the Commission will not fund an already-started activity, since this does not encourage new activities or promote the visibility of our actions. Therefore a project which is part of an ongoing scheme must be clearly distinguished as a separate and independent task or stage.
Negotiation in stages:: It is possible that the contract initially offered will fund only an initial part of the work. Negotiation cannot be in stages however - a complete Annex 1 covering the total duration of the project must be agreed now, leaving no holes or open-ends. This also applies to linked contracts, where one is based on the completion of the other - both must be fully agreed from the beginning.

Funding models

The AC (additional costs model):: The AC model in RTD and demonstration projects is offered only when the contractor genuinely cannot identify the full costs related to the project, and so is strictly limited to those whose accounting system is based on disbursals and not on costs e.g. governmental organisations, non-private universities or hospitals, public authorities etc.
The FF (Full cost with fixed overhead) model:: Where an organisation can quantify the direct costs for the work but not the associated overhead, it must in RTD and demonstration projects opt for the FF model. A fixed payment of 80% of the personnel cost is given to support the overhead. (A participant is free to accept a smaller percentage, if wished).
The FC (full cost) model:: Where an organisation can quantify the overheads as well as the direct costs associated with the work, then it may in RTD and demonstration projects opt for the FC model. In this case, their overheads are funded at the same rate as the direct cost of the work. They have to report their overheads in detail, and this information is checked and is subject to audit.
FF option for participants who qualify for FC:: An organisation in an RTD or demonstration project which can quantify its overheads, and would therefore qualify for FC treatment, may optionally choose to be treated as FF.
Different models in different projects:: An organisation must conform to the same cost model in all RTD/demonstration projects in which it is participating.
Overheads in other types of project:: Accompanying Measures and Concerted Actions/Thematic networks have entirely different arrangements for overheads than those described above for RTD and demonstration contracts. Normally, Accompanying Measures pay up to a maximum 80% of personnel cost differing according to the type of measure, to be negotiated with the Commission PO; but Take-up actions, though these are also classified as Accompanying Measures, do not pay an overhead contribution at all. Concerted Actions/Thematic networks pay a flat-rate amount of 20% of the direct costs excluding subcontracting costs. In all cases the contractor may accept a smaller percentage if wished.

Contract

Type of contract offered:: The type of contract offered (RTD project, Demonstration project, Accompanying measure, Thematic network etc.) is decided by the Commission following the rules of the Framework Programme. The choice of type of contract determined how the proposal was evaluated, and it is therefore not re-negotiable now.
Multiple contracts:: In some cases the Commission may offer two contracts for a project, dividing R&D elements from demonstration elements, for example. Such contracts might even be foreseen sequentially, one depending on the results of the other.
Companies in course of formation:: The Commission cannot offer a contract to an organisation which is non-existent. Your organisation must achieve a recognised legal existence prior to contract signature.
Subcontracts:: The PO will examine all cases where a participant is foreseeing major subcontracting costs. If the tasks being subcontracted are a significant part of the project's work he may insist that the subcontractor becomes a party to the Commission contract, as a principal or assistant contractor. He may also question the need for the continued presence of the participant which is issuing the subcontracts within the project consortium.
Contract signature:: A participant can sign the contract on his own behalf, or for speed or convenience he can delegate his signature to the coordinator to sign the contract in his place. A mandate for this is provided as Annex I of the CPFs. Use of this mandate is purely voluntary.
Members:: Members in Thematic networks and Take-up actions do not sign a contract with the Commission, but instead a membership agreement with the contractor they are members to (normally, the coordinator). They are not joint and severally liable for the completion of the work, so their rights to the results may be restricted. However their rights are defined in the membership agreement, so they could be same as for contractors.

Contract Preparation Forms

Eligible costs:: A cost shall be considered as eligible for Commission support only where it is necessary for and during the project and is provided for in the contract. It shall be reimbursed if the amount has actually been spent and recorded in the accounts. No profit may be included.
Non-eligible costs:: There are certain frequently-occurring types of cost which are not eligible for Commission support. See the "Guidelines on Major Financial Provisions" document, section 5.
Notional costs:: All costs eligible for Commission support must be real. Goods or services supplied free to the project cannot be the subject of a cost claim based on a notional value.
Coordinator's financial coordination costs:: This new heading in the 5FWP is for the various accountancy and clerical tasks involved for the coordinator in the financial management of the project. These costs could not be directly charged before, as they were considered to be covered by the coordinator's overhead payment. (Use of this cost category is optional however; a coordinator may continue to count the financial administration costs among his overheads, if he wishes).
Other financial coordination costs:: Only the coordinator (financial and administrative coordinator) may directly charge his costs for the financial coordination costs. For other participants, all such accountancy and clerical tasks are covered by the overhead payment only.
Scientific coordination costs:: The scientific coordination tasks are considered as part of the regular scientific work of the project, and the costs for these are distributed over such headings as Personnel costs, Travel and subsistence etc. like the rest of the project's scientific work.
Overheads:: The Commission will examine the overheads proposed to be charged by participants. If they appear extravagant, the PO may ask for further evidence of these charges before proceeding with negotiations (remember that no element of profit may be included). These costs are subject to audit during the project, and in cases of over-payment the Commission will demand reimbursement.
Labour rates:: The Commission will examine the labour rates proposed to be charged. If they appear extravagant, the PO may ask for further evidence before proceeding with negotiations (remember that no element of profit may be included). These costs are subject to audit during the project, and in cases of over-payment the Commission will demand reimbursement.
Profit bonuses:: Certain companies operate schemes whereby staff's official salaries are fixed at a low level, but are topped up by profit bonuses at end of year. Labour rates in the CPF must be based on the actual salary cost, without contribution to any bonus scheme (since no claimed cost may contain a profit element).
Training/education courses:: The cost of attendance at training/other educational courses by project participants is never allowable as an eligible cost - a contract is offered to you on the assumption that you already have the necessary skills and expertise to carry out the work.
Research partnerships:: In case of participation by research bodies such as "organisations" or "partnerships" which are not themselves officially legal entities (e.g. Unité Mixte de Recherche and other similar groupings) each participating organisation in the research body must complete a full set of contractors forms in the CPFs.
Anticipated changes in CPF data:: A participant completing a CPF may be aware that some data is about to change (a change of address, company legal status etc.) He should complete the CPF on the basis of the data as it will be at start of contract. If some of that data is not yet available (e.g. the new phone number) he should leave a blank and supply the information as soon as possible afterwards. He should add a short note to the CPF explaining the situation.
Swiss participation:: Switzerland has negotiated Associated State status with the EU, but is not expected to ratify it until January 2001. Swiss participants should for the moment complete the CPFs on the basis that they will not receive EU funding.

After signing contract

Advance payments:: The Commission will make an advance payment within 60 days of last contract signature.
Contract start date/Project start date:: The contract comes into force at the moment of last signature (i.e. the Commission signature). The project start date is then the first day of the following month (project month 1).
Applicable law:: The contract will be subject to Belgian or Luxembourg law, depending on the location of the Key Action to which your project contributes.
Role of individuals named in contract:: An appendix to Contract Annex 1 lists and gives short CVs of key persons involved in the work. These individuals must indeed be involved in the work - substitution of lower-grade staff would be a breach of contract. In the event of a named individual leaving the participating organisation during the course of the project, the PO must be informed in writing.
Amendments:: The Commission will consider requests at a later stage for any reasonable amendments to the contract which do not essentially change the character of the project. This may include changes to the workplan based on changes in the market. Significant changes to the technical content of the work would normally require the approval of the external experts during the periodic project review process.
Estimated project duration:: If the project finishes earlier than expected, the contract will be wound up earlier, therefore without delays to final payment to the contractors. If the contractors find the project takes longer than expected, an amendment granting a reasonable extension in time may be given. This requires the approval of the Project Officer. Requests for extension must be made at least two months before the originally-foreseen project end-date.
Final reporting costs:: The Commission contributes to report-writing costs for up to two months after the end of the project, for the completion of the Final Report and the Technology Implementation Plan.

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