Actions to boost the development of finance markets for social enterprises

Deadline: Apr 21, 2020  
CALL EXPIRED

1.1. Programme/Legal base

This call for proposals is published under Regulation (EU) No 1296/2013 of the European Parliament and of the Council of 11 December 2013 on a European Union Programme for Employment and Social Innovation ("EaSI")1 and amending Decision No 283/2010/EU establishing a European Progress Microfinance Facility for employment and social inclusion. It is under the annual work programme C(2018)6891 adopted by the Commission on 25/10/2018 and updated by C(2019)3192 on 2/05/20192.

The call is financed under the European Programme for Employment and Social Innovation "EaSI" 2014-20203 which is a European-level financing instrument managed directly by the European Commission to contribute to the implementation of the Europe 2020 strategy, by providing financial support for the Union's objectives in terms of promoting a high level of quality and sustainable employment, guaranteeing adequate and decent social protection, combating social exclusion and poverty and improving working conditions.

1.2. Policy and economic background

Social enterprises as vehicles for job creation and social innovation

Building an economy that works for people is one of the political guidelines of the European Commission. In line with this goal, small businesses, and in particular social enterprises, are a powerful tool in strengthening Europe’s social market economy and delivering social fairness and prosperity.

In its 2016 Start-up and Scale up Initiative, the Commission has in particular recognised the potential of social enterprises for innovation and their positive impact in economy and society at large. Social enterprises develop innovative approaches, models or practices for resolving societal challenges in an entrepreneurial way to promote inclusive, socially fair and environmentally sustainable economic development and social change. Their economic operations cover a broad spectrum of activities (including in particular social and economic integration of the disadvantaged and excluded, social assistance and care services of general interest, education and training, community development, reducing emissions and waste, or producing renewable energy).

Lack of or poor access to finance enabling social enterprises to start up and scale up their activities is still a significant barrier for starting up or developing a social enterprise. The Social Business Initiative4 emphasized that the funding system for social enterprises is underdeveloped in relation to that used by other businesses. This was confirmed by a study that looked at imperfections in the social investment market5 and a Commission study on mapping of social enterprises and their eco-systems in Europe6, as well as a number of national studies which would confirm that the demand of social enterprises for capital is not met in most parts of Europe. Due to their size, the financing amounts that the majority of social enterprises need are relatively small: the most important financing gap in the market is below EUR 500 000 for early-stage social enterprises.7

To be able to access the social investment market, social enterprises have to be 'investment ready'. In this context, specialised capacity building support is important to help social enterprises acquire the skills and knowledge they need to develop sustainable business models and to manage companies successfully. It is equally important to enable social enterprises to successfully mobilise external funding or investment.

Barriers in the social finance market

Barriers to develop and strengthen the market for social finance have a different weight across Europe, the most relevant being:

•   On the supply side: lack of suitable financial instruments in place; a shortage of investors prepared to invest; scarcity of significant public sector initiatives; little experience in specifying a sustainable investment strategy and risk/return profile of a social finance fund; lack of capacities and tools to assess the viability of business plans and social impact; absence of market facilitators (such as qualified intermediaries and market places) or business angels etc.

•   On the demand side: underdeveloped business models; excessive dependence on grants and insufficient orientation towards capital markets; legal structures which discourage the attraction of (quasi-) equity; lack of transparency of the market for social finance; insufficient financial literacy and lack of experience in making proposals for external financing or for combining different sources and types of finance (e.g. grants/loans); insufficient infrastructures /business development services/ incubators; lack of management and business development skills, lack of skills to operationally scale-up or replicate activities etc.

 

1.3. Main Purposes

Social Entrepreneurship support under the European Union Programme for Employment and Social Innovation (EaSI)

One of the objectives of the EaSI programme is to promote employment and social inclusion by improving access to finance for social enterprises and supporting the development of the social enterprise finance market.

Under the EaSI Microfinance and Social Entrepreneurship axis, at least 68 million EUR are earmarked for this purpose. Several financial instruments have been deployed under or with support from EaSI:

•   The EaSI Guarantee scheme was launched in June 2015 to cover loans (of up to EUR

  500 000) to social enterprises. This risk-sharing mechanism gives incentives to social enterprise investors to reach out to entrepreneurs they would not have been able to finance otherwise.

•   The EaSI Capacity-Building Investments window was launched in December 2016. It aims at building up the institutional capacity of selected social enterprise finance providers in Europe primarily through equity or quasi-equity investments.

Under the EaSI programme, the total amount that a social enterprise can receive is EUR 500 000 (state aid rules to be respected). Support under the programme is limited to enterprises, not listed on the stock market, with a maximum of EUR 30m turnover.

In addition, a set of pilot social impact equity instruments was launched in October 2016 under the European Fund for Strategic Investment (EFSI) (with a first-loss piece from EaSI and Innovfin): they include a facility for financial intermediaries linked to incubators, accelerators, and/or that provide incubation services for social enterprises in their early stages (at least EUR 25 million) and a Business Angel Facility (at least EUR 25 million) that will make investments alongside business angels or in business angel funds, including private individuals or non-institutional investors who invest into social enterprises at seed, early stage as well as expansion and growth stage.8

Both EaSI and EFSI financial instruments are implemented by the European Investment Fund.9

Support for enabling access to finance for social enterprises is planned to be continued in the period 2021-2027, under the InvestEU Fund.

Lessons from previous EU support actions

Two calls for proposals were launched in the past with the aim of supporting the development of the demand and supply for social enterprise finance: one call was launched in 2013 and a follow-up call in 2016. These pilot initiatives supported testing the potential of the finance market for social enterprises in the EU, and the development and establishment of feasible, suitable and reliable models that facilitate the access of social enterprises to funding.

The lessons learned from the pilot actions indicate that a variety of forms of support and tools have already been tested and established in some countries, while in other European countries the finance market for social enterprises is still at an early stage of development. Building the capacity of the supply side (finance providers/intermediaries) to create partnerships and develop new funding instruments for social enterprises, as well as of the demand side (through capacity building and investment readiness schemes for social enterprises to support their consolidation, growth and scaling) has to continue.

Learnings also indicate that the demand and supply sides of the market need to develop stronger ties: for investment readiness programmes to be successful, there need to be investments in sight, while financial instruments - once designed and established - need to be able to find corresponding investees.

To make the best use of the experience of the pilot actions, a “Practical guide on designing and implementing initiatives to develop the social finance market”10 has been drawn up in 2016. An update of this guide will be published soon11. The guide is intended to take readers through the thinking and decision-making process that investors or social finance intermediaries can follow in designing and piloting initiatives to develop the demand or supply side of the finance market for social enterprises, pointing out key considerations and possible pitfalls, illustrated by case studies and examples.

Social enterprises and their ecosystems in Europe

A mapping study aimed at shedding light on social enterprises and their ecosystems in Europe was carried out by the Commission. Country reports covering all EU Member States have been published in 2013-2014 and have been further updated in 2016-2019. Moreover, country fiches covering other European countries that participate in the EaSI Programme are now available. A synthesis report covering all EaSI participating countries is forthcoming by the end of 2019. All reports are available at: https://ec.europa.eu/social/main.jsp?catId=952&intPageId=2914&langId=en

The mapping provides a first analysis of the national ecosystems, including the demand and supply of finance for social enterprises, the features of social enterprises, legal and policy frameworks, and available support measures. It also attempts to measure the number of social enterprises, and provides information on challenges and opportunities, therefore representing a good starting point for more in-depth assessments.

 

2. OBJECTIVES – PRIORITIES – EXPECTED OUTPUTS – TYPES OF ACTIONS

2.1. Objectives - Priorities - Outputs

The objective of the call for proposals is to contribute to the development of a social finance market, by designing and launching financial instruments for social enterprises and, at the same time, generating effective demand for social finance among social enterprises by developing their “investment readiness”. Ultimately this should enable more social enterprises to take on repayable finance for developing and scaling up their business model. In this way the call aims at feeding the pipeline for the EU level financial instruments such as the EaSI Guarantee, the EaSI Capacity Building investments, the EFSI social impact investment instruments, as well as future EU level instruments for social entrepreneurship which will be launched under the InvestEU Fund.

The call also encourages learning from different models and good practice in developing and enhancing social finance across the Union, through organized sharing and disseminating of expertise and experience.

In order to achieve these objectives, the Commission will set up a learning network of the grant beneficiaries and facilitate peer learning and transnational exchanges. It will also assist projects in using EU financial instruments. (see section 16.1 for more details)

In order to take into account the different stages of development of social finance markets as well as different stages in the preparation of financing instruments for social enterprises, the call offers two strands. Each strand addresses a specific configuration of barriers in the social finance market. Both strands aim to develop and connect the supply side of social finance (by establishing partnerships, financial instruments or financial intermediaries) and the demand side (by enabling the delivery of business development and investment readiness services for social enterprises).

Strand A: Establishment of social finance partnerships

This strand encourages the first steps towards a social finance instrument by facilitating the development of a consortium and commitment to act in view of laying the groundwork for a future financial instrument. It is also meant to encourage learning from good practice examples and expertise that can guide the formation of this partnership.

This strand is particularly relevant for actions in countries/territories with nascent social finance markets. It addresses situations in which no suitable financial instrument for social enterprises is in place, and there is a lack of investors or banks prepared to launch or participate in a financial instrument for social enterprises. As for the demand of social finance, there is lack of business development and investment readiness support structures/ programmes that cater to the specific needs of social enterprises and can therefore prepare a pipeline of investees for a new financial instrument. Although there is little experience in specifying a sustainable investment strategy and risk/return profile of a social finance instrument, there is some openness amongst potential investors, intermediaries and/or public bodies to contribute to establishing a suitable financial instrument and related business support services.

The concrete outputs should include a Memorandum of Understanding between private, public and not-for profit-partners documenting:

• -  a detailed assessment of the social finance market and a vision for closing gaps and overcoming deficiencies in the supply of social finance, including needs in terms of types and size of investments and assessment of the investment readiness of potential investees;

• -  assessment of the suitability and feasibility of setting up a sustainable social finance mechanism;

• -  identification of suitable managers for the financial product envisaged;

• -  the commitment of the partners (including their roles and contributions) to contribute to, and to collaborate in, establishing a financial product that provides finance for social enterprises and that works in synergy with start-up and business development services for social enterprises;

• -  the outline of an investment strategy for this financial product, in particular, the key areas of vision, investment focus (geographical and sector focus), models of intervention, risks and returns, types of investee organizations, form and size of investment, co-investment, non-financial support;

• -  an outline of the investment readiness plan including an indication of the methodologies, tools and activities envisioned for enabling social enterprises to become investment ready;

• -  a description of the strategy and actions planned for achieving this after the end of the projects.

Strand B: Establishment of social finance instruments and mechanisms

This strand is aimed at mobilising key partners (potential investors, support organisations and stakeholders) to act and to cooperate with a view to setting up a concrete financial instrument. This type of action can give a strong signal to capital providers by demonstrating the feasibility of social finance. It is also meant to reduce the risks associated with innovation and to facilitate the acquisition of specific expertise needed for drafting contractual agreements.

This strand is particularly relevant for actions in countries/territories with young social finance markets. It addresses situations where different types of actors are already operating in the social finance market, but in isolation. Although there is already an understanding of market needs and funding gaps and potential investors, intermediaries and banks are willing to invest in/support social enterprises, they lack expertise that can guide the drafting of contractual agreements needed for setting up a financial instrument. There is also a lack of capacities and tools to assess the viability of business plans, design investment strategies and evaluate social impact. On the demand side, there is either an unmatched pipeline of investees or potential investees lack business development and investment readiness/follow- up support.

The concrete outputs should include a commitment of different types of investors (private investors, donors, public authorities), social enterprise support organisations and intermediaries and necessary agreements between private, public and not-for-profit partners to establish a financial instrument, including :

• -  the legal agreement of the partners (specifying their roles and contributions) to finance, set up and manage a financial instrument providing finance as well as investment readiness / follow-up support to social enterprises;

• -  the detailed investment strategy agreed encompassing, in particular, the key areas of vision, investment focus - geographical and sector focus, models of intervention, risks and returns, types of investee organisations, form and size of investment, co-investment, non-financial support, governance structures, obligations and benefits of investors, management rules and procedures as well as monitoring and evaluation arrangements;

• -  all contractual arrangements needed for the registration of the financial instrument, for fundraising, for investments, lending or underwriting and for the conduct of management;

• -  the investment readiness strategy including methodologies (e.g. training, coaching, mentoring, capacity building), tools and actions planned to ensure a steady and balanced deal flow and sustainability for the financial instrument;

• -  the methodologies, procedures or resources (e.g. for due diligence, impact measurement and reporting) jointly applied by the partners to reduce transaction costs and build mutual trust and confidence.

2.2. Description of the activities to be funded / Type of actions

The activities to be funded will consist of developing social finance partnerships and feasible, suitable and reliable financial instruments or schemes providing finance to social enterprises, as well as non-financial support aimed at improving the social enterprises' investment readiness (such as business development and networking).

Actions on both strands must be fully carried out in EaSI participating countries and must focus on supporting social enterprises that are in need of smaller investments (< 500,000 EUR).

Activities necessary to deliver the outputs foreseen in section 2.1 may be funded under this call for proposals. These may include a mix of activities such as:

• -  Analytical activities such as market assessments, mapping projects, assessment of feasibility and suitability of setting up social finance mechanisms/instruments, design of methodologies, tools, processes;

• -  Marketing/networking actions aimed at bringing in additional investors (e.g. organisation of meetings or participation in relevant conferences/ fora that gather potential investors);

• -  Training activities and capacity building actions (e.g. aimed at developing capacities for managing investments);

• -  Knowledge dissemination and know-how transfer from and to peers in other EaSI participating countries12 (e.g. study visit, expert workshop, adaption of tools, procedures/contracts, etc.);

• -  The replication or adaptation of proven financing or support models, to be implemented in other countries. This may also include translations.

  In addition to the activities above which are relevant for both strands, the activities below may be funded and are particularly relevant for Strand B applications:

• -  Work of financial experts and lawyers to draft the legal documents for setting up the social finance instrument or mechanism required by EU or national legislation;

• -  IT services in case the financial instrument uses web-tools or is based on a web platform (e.g. crowdfunding platforms);

• -  Provision of investment readiness services to social enterprises13.

 

2.3. Guidance for the preparation of proposals and activities

Proposals must include the following information, as instructed in the template for the “Description of the action and work plan” which is available in SWIM and is further described in section 16.1 of this call:

For Strand A:

• -  a short overall description of the social finance market targeted by the proposal, indicating the type of social enterprises targeted and describing the situation on both the demand and the supply side.

• -  a description of the strategy and action plan for mobilising potential investors, support organisations and intermediaries that would sign a Memorandum of Understanding.

  For Strand B:

• -  a baseline assessment of the social finance market giving an indication of the stage of development of the market the applicant is operating in, the type of social enterprises targeted and their needs in terms of financial support (types of financial instruments needed and size of investments) and non-financial support (assessment of skills deficits), key barriers and a vision for closing gaps and overcoming deficiencies in the supply and demand of social finance.

• -  a Memorandum of Understanding or a cooperation agreement between the investor(s) and support organisation(s), including:

  •   an investment strategy agreed between partners (specifying objectives, action plan, resources, risks/return profile etc.) for the financial product to be established

  •   a sound (internal or external) feasibility assessment of the investment strategy

  •   an identification of an organisation that could potentially manage the financial instrument.

The following material and tools can be useful for the preparation of proposals and of activities included in the work plan:

•   the Commission ́s Study “A map of social enterprises and their eco-systems in Europe”.14 The relevant country reports should be used to inform the short description of the social enterprise finance market (for Strand A) and the baseline assessment of the social enterprise finance market (for Strand B) which need to be included in the proposal;

•   the Better Entrepreneurship online tool.15 The use of the tool should be foreseen by Strand A proposals and, if needed, also by Strand B proposals, which plan to carry out, as part of their work plan, an in-depth assessment of the market gap, including needs in terms of types and size of investments and potential demand (e.g. a workshop with relevant public and private stakeholders can be envisaged);

•  the publication "A recipe book for social finance. A practical guide on designing and implementing initiatives to develop social finance instruments and markets".16 Applicants should use this practical guide or other similar guides as a source of inspiration and guidance, to ensure that each step in decision making addresses the relevant issues and options.17

2.4. Monitoring

The Commission, with the support of an external contractor, will monitor regularly the EaSI Programme. Therefore, beneficiaries/contractors will have to transmit qualitative and quantitative monitoring data on the results of the activities. These will include the extent to which the principles of equality between women and men has been applied, as well as how anti-discrimination considerations, including accessibility issues, have been addressed through the activities. Related templates are attached or will be provided.

The Commission will monitor the action for the EaSI programme through the information provided in the specific Annex to the Grant Agreement. The reporting template is published on the respective EaSI call page https://ec.europa.eu/social/main.jsp?catId=629&langId=en.

In setting up the action, beneficiaries must foresee the necessary funding for monitoring and reporting to the Commission. For events, it is important to get from participants their specific consent by a statement or by a clear affirmative action for processing and transferring their personal data also to an external contractor responsible for the monitoring of the EaSI programme. Beneficiaries/contractors should therefore inform all participants via a Privacy Statement that is not only published online, but is also provided individually to each participant (e.g. as part of the email where the beneficiary/contractor first contacts the individual concerned) that the Commission/external contractor would be processing their personal data. Beneficiaries/contractors have to be able to demonstrate that consent was obtained subject to conditions of Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data (i.e. keep a record that shows how the consent was obtained and whether it was valid) and Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data.

A model privacy statement is available on the Europa website of the EaSI programme: https://ec.europa.eu/social/main.jsp?catId=1081&langId=en&furtherCalls=yes&callType=2.

 

2.5. General requirements for the activities to be funded under EaSI

The EaSI Programme shall, in all its axes and actions, aim to:

(a) pay particular attention to vulnerable groups, such as young people;

(b) promote equality between women and men,

(c) combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation;

(d) promote a high-level of quality and sustainable employment, guarantee adequate and decent social protection, combat long-term unemployment and fight against poverty and social exclusion.

Hence, in designing, implementing and reporting on the activity, beneficiaries must address the issues noted above and will be required to provide detail, in the final activity report on the steps and achievements made towards addressing those aims.

 

3. TIMETABLE

Stages

Date or period

a) Publication of the call

29/11/2019

b) Deadline for questions and requests for clarification

21/03/2020

c) Deadline for submitting applications

31/03/2020

Swim, Courier and Post : 24:00 Brussels' time (CET)

Hand deliveries 16:00 Brussels' time (CET)

d) Evaluation period (indicative)

04 - 07/2020

e) Information to applicants (indicative)

08/202018

f) Signature of the grant agreements (indicative)

10/202019

 

3.1. Starting date and duration of the projects

The actual starting date of the action will either be the first day following the date when the last of the two parties signs the grant agreement, the first day of the month following the date when the last of the two parties signs or a date agreed upon between the parties.

Applicants should note that if their project is selected, they may receive the grant agreement after the start date of the action that they have indicatively set in the application form. It is therefore advisable to number the months in the work programme instead of indicating the name of the month.

No expenditure can be incurred before the date of submission of the application. Any expenditure incurred before the signature of the Grant Agreement will be at the applicant’s risk.

An action grant may be awarded for an action which has already begun only where the applicant can demonstrate in the grant application the need to start the action before the grant agreement is signed.

The duration of the actions should indicatively be between 18 months and 24 months.

 

4. AVAILABLE BUDGET AND CO-FINANCING RATE

4.1. Available Budget

The total budget earmarked for the co-financing of actions is estimated at EUR 2 500 000 million.

There will be no specific distribution of funds per strand. Taking into account the available budget, the proposals with the highest total scores will be recommended for award, irrespectively of the strand under which they have been submitted, and on the condition that the total score reaches minimum 65 points.

The EU grant requested should indicatively be:

• -  for strand A: between EUR 150 000 and EUR 200 000

• -  for strand B: between EUR 200 000 and EUR 250 000

The following costs must be included in the proposed budget of the action:

• - staff, travel and accommodation costs linked to the participation in six mutual learning workshops organised by the European Commission across Europe. The costs of at least one participant to the workshops should be foreseen (maximum 2 nights/workshop).

The aim of the workshops will be to share practices and experience gained in implementing the action and lessons learnt, with the objective of transnational mutual learning. The workshops will bring together organisations supported under this call and other competent organisations.

• - staff costs linked to the participation in quarterly interviews conducted by an organisation contracted by the Commission, with the aim of providing feedback on the implementation of the action.

The aim of the interviews will be to provide information on the activities undertaken, problems faced and how these were overcome, tools used, results achieved and learning needs.

Optionally, the following costs may be included in the proposed budget of the action: - 12 -

- a maximum of 10 000 EUR for transnational joint learning activities such as knowledge dissemination, know-how exchange, joint development, other than the above mentioned six mutual learning workshops.

These activities should be organised in collaboration with other grant beneficiaries of this call for proposals or of the similar call for proposals launched in 2016 (ref VP/2016/007)20. Beneficiaries will have the occasion to meet each other during the first mutual learning workshop organised by the European Commission.

The first draft of the work plan for these activities should be presented for approval by the Commission within two months from the first mutual learning workshop.

The Commission reserves the right not to distribute all the funds available.

The Commission reserves the right to increase the amount of the funds in case of available funds and distribute them to proposals admitted in the reserve list, if any. This top-up of the budget is limited to 20% of the initial budget of the call.

4.2. Co-financing rate

Under this call for proposals, the EU grant may not exceed 80% of the total eligible costs of the action. The applicants must guarantee their co-financing of the remaining amount covered by the applicants' own resources or from sources other than the European Union budget21.

 

5. ADMISSIBILITY REQUIREMENTS

•   Applications must be sent no later than the deadline for submission referred to in section 3(c)

•   Applications (meaning, the application form, including budget, description of the action and work plan) must be submitted using the electronic submission system available at https://webgate.ec.europa.eu/swim, and by sending a signed, printed version of the complete application form (including all documents specified in the check-list) by post or courier service (one original dossier and one copy; see section 16).

•   Applications must indicate the Strand under which they should be evaluated. Failure to comply with one of the above requirements may lead to the rejection of the application.

Applicants are encouraged to submit their project proposal in English in order to facilitate the treatment of the proposals and speed up the evaluation process. It should be noted, however, that proposals submitted in any of the official languages of the EU will be accepted. In this case, applications should be accompanied by an executive summary in English (see checklist, point 3).

 

 

 

6. ELIGIBILITY CRITERIA

6.1. Eligibility of the applicants (lead and co-applicants) and affiliated entities22

For British Applicants: please be aware that eligibility criteria must be complied with for the entire duration of the grant. If the United Kingdom withdraws from the EU during the grant period without concluding an agreement with the EU ensuring in particular that British applicants continue to be eligible, British beneficiaries will cease to receive EU funding (while continuing, where possible, to participate) or be required to leave the project on the basis of the article of the Grant Agreement allowing termination due to a change of the legal situation of the beneficiary, i.e.: Article II.7.2.1(a) for mono-beneficiary and Article II.17.3.1(a) for multi-beneficiary of the Grant Agreements.

a) Place of establishment

Legal entities properly established and registered in the following countries are eligible as lead applicant and co-applicants:

  

EU Member States;
Iceland and Norway in accordance with the EEA Agreement; Albania, North Macedonia, Montenegro, Serbia and Turkey23

b) Type of entities

To be eligible, the lead applicant, co-applicant and affiliated entity may be public or private entities of any type.

c) Consortia24
To be eligible, actions must have the involvement of a consortium including a lead applicant

and at least two co-applicants.
For strand A, the consortium must include at least (see checklist point 18):

- one (potential) investor that has signed a letter of intention to invest/co-invest in the envisaged financial product;

- one support organisation that has signed a letter of intention to provide business development /investment readiness services to (potential) investees.

22. 22  See section 2 of the Financial Guidelines for definitions.

23. 23  These are the countries which are eligible to participate in the EaSI Programme. Other candidate and

    potential candidate countries would also participate in accordance with the general principles and the general terms and conditions laid down in the framework agreements concluded with them on their participation in Union programmes. However, it is not yet confirmed, therefore applicants and co- applicants from those countries should check with the secretariat of the call (empl-vp-2019- 015@ec.europa.eu) their eligibility.

24. 24  Letters of mandate, authorising the lead applicant to submit the proposal and to sign the Grant Agreement on their behalf must be submitted by each co-applicant. Letters of commitment must be submitted by each co-applicant and affiliated entity, certifying that they are willing to participate in the project with a brief description of their role and indicating any financial contribution where applicable (see checklist points 5 and 6). Letters of commitment are also required from any associate organisations (participation on a no- cost and no financial contribution basis).

 

For strand B, the consortium must include at least (see, checklist point 18):

• -  one private/public investor that has signed a letter of commitment to invest/co-invest in the financial instrument to be established

• -  one support organisation that has signed a letter of commitment to provide business development/investment readiness services to (potential) investees.

If the lead applicant is considered not eligible, the application will be rejected.

If a co-applicant is considered not eligible, this organisation will be removed from the consortium and their costs/activities will be removed from the budget/project. The eligibility of the modified consortium will then be re-evaluated without them. If the application is accepted for funding, the work plan and budget will have to be adapted as appropriate.

d) Affiliated entities

Legal entities having a legal or capital link with applicants, which is neither limited to the action nor established for the sole purpose of its implementation and which satisfy the eligibility criteria, may take part in the action as affiliated entities, and may declare eligible costs.

For that purpose, applicants shall identify such affiliated entities in the application form. e) Associate organisations25
An associate organisation can participate in the action but may not declare eligible costs.

6.2. Eligible activities

a) Geographical Location

Actions must be fully carried out in eligible countries participating in EaSI programme (see section 6.1).

b) Types of activities

The grant will finance the activities indicated in section 2.2.

Financial support to third parties, as defined in point 3 of the Financial Guidelines, is not eligible for EU funding.

c) Core activities

The following activities are core activities and may not be subcontracted:

 Project coordination/management activities

 Sharing practices, experience and lessons learnt through different forms of communication, as defined in section 16.2.

 

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