Digital enablers in SMEs - support for digitalisation to enhance SMEs' capacity to go international and innovate

Deadline: Jan 31, 2018  
CALL EXPIRED

INTRODUCTION – Background

The European Commission adopted on 28.04.2017 a financing decision for a pilot project in the field of Digital enablers in SMEs: support for digitalisation to enhance SMEs' capacity to go international and innovate.

 

This pilot project, promoted by the European Parliament, will address the lack of knowledge about digital technologies within companies. Its aim is to match small- and medium-sized companies and mid-caps which are growth-oriented on the one side with highly-skilled digital experts on the other side, in order to fill the lack of adequate technological competences. It will equip the respective company with the appropriate knowledge to start its digital transformation. This transformation is essential for sustainable growth both within the EU internal market and towards extra-EU countries.

 

1.1. Background

 

The European Commission under the responsibility of the Commissioner for Digital Economy and Society launched on 19 April 2016 an initiative on digitising the European industry. The initiative aims at supporting European industry in its digital transformation.

 

Digital technologies are bringing a step change in the way companies design, produce, commercialise and create value from all types of goods and relevant services. Most of European high tech and large industries are fully aware of the importance of digital innovations. A clear illustration is the increasing digitisation of all types of products such as cars that become more connected and automated.

 

Digitisation is increasingly applied by high tech industries through a more intensive use of data analytics, complex simulation and modelling, robotics or 3D printing that is transforming production and business processes. This is also bringing major disruptions to business models as illustrated by the blurring of boundaries between products and services and the emergence of the sharing economy.

 

Digitisation is bringing us not only substantial gains in productivity and efficiency over the full cycle from product design to lifecycle management, but also a range of new products, processes and services that are safer, more comfortable, less resource consuming and more fit to our modern life. Digitisation of products and services could increase EU industry revenues by €110 billion per year by 2025.

 

When it comes to the uptake of digital innovations, Europe's high tech industry is amongst world leaders in integrating the technology into its products and processes. It is unfortunately not the case for the large majority of our industry and in particular not for SMEs and mid-caps and traditional sectors like construction or agro-food. Less than 2% of SMEs use advanced digital technologies to innovate in products or processes. A large disparity exists also between Member States and regions which is creating a new "digitisation divide" that may ultimately cripple all our economies.

 

This "digitisation divide" across companies of different sizes and across different industries is due to two aspects: first, smaller companies shy away from investments in new technologies if it is not clear whether these technologies turn out to be profitable. Second, they often lack the technical knowledge which is necessary to modify and implement their processes and develop new products based on new technologies.

 

To address both barriers, the Commission will invest €500 million in Digital Innovation Hubs (DIHs) so that every industry, large or small, high-tech or not, can understand the digital opportunities and get access to knowledge and testing facilities in the latest technologies.

 

The core of a DIH is a competence centre located in a technical university or research organisation. They will provide companies, in particular SMEs, with access to facilities for experimenting and testing digital innovations. Apart from this technological support, hubs also supply innovation services such as advice on potential sources of financing for upscaling the experiment to real production and roll out. It can also support industry in training its staff and improve their digital skills, or in their efforts to enter new markets.

So a Digital Innovation Hub provides both technological support (through a competence centre) as well as more general innovation support.

 

This pilot project will also address the lack of knowledge about digital technologies within companies. It is a preparatory action promoted by the European Parliament. It's aim is to match small- and medium-sized companies and mid-caps which are growth-oriented on the one side with highly-skilled digital experts on the other side, in order to fill the lack of adequate technological competences. It will equip the respective company with the appropriate knowledge to start its digital transformation. This transformation is essential for sustainable growth both within the internal market and towards extra-EU countries.

 

1.2. Main idea of the project

 

This pilot project will provide support and funding for highly-skilled digital experts (digital enablers) to work in a growth-oriented SMEs and mid-caps established in another Member State for one month to tackle the digitisation needs of the company. Through this cross border exchange companies can get expertise to knowledge not available in their region, which will help them to internationalise. The digital enabler will get experience to work in another country, and to extend his/her network and knowledge of different cultures. It might provide opportunities to find an exciting job across Europe for people in need of a new job, or for an experienced person of a company to work in a totally different environment for a while. It can be viewed as an Erasmus period for digital enablers.

 

Digital enablers are persons having a broad understanding and overview on opportunities arising from digitisation. They should have a proven record of mastering relevant technologies and processes and a cross-cutting specialisation (e.g. digital industrial platforms, enterprise resource planning systems, automation processes, Cyber-Physical-Systems, Internet of Things, digital design, simulation and analytics, advanced laser-based technologies, industrial robotics, 3D printing or Artificial Intelligence). Further, the digital enablers should be able to draw up specific digitisation concepts for SMEs and mid-caps.

 

Digital enablers should make an in-depth analysis of the digitisation needs of the SME or mid-cap and elaborate a digitisation concept that enables the internationalisation of their business. If possible, a start can be made with the implementation of the concept.

This call for proposals is targeted towards Digital Innovation Hubs that want to pilot the digital enabler concept. They are in a good position to make effective matches between companies and digital enablers. In the context of the Digitising European Industry strategy a working group has elaborated what a DIH is and how regions can set up DIHs serving their own smart specialisation strategy. Page 17 mentions that DIHs could put in place exchange programmes between Hubs and/or between client companies, based on an Erasmus model.

 

The project consortium should be composed of a minimum of 3 existing Digital Innovation Hubs from 3 different Member States. They must have relevant contacts to find digital enablers (persons or companies) and to identify suitable SMEs and mid-caps and their needs in an efficient and timely way.

 

Objectives and tasks

2.1 Objectives and approach

The goal of this project is to pilot a cross-border digital enabler scheme to support SMEs and mid-caps in their digital transformation and internationalisation efforts. Focus is digital technologies such as Cyber-Physical-Systems, Internet of Things, digital design, simulation and analytics, advanced laser-based technologies, industrial robotics, 3D printing, Artificial Intelligence etc.

Digital enablers are sent to SMEs and mid-caps in order to develop a digitalisation concept according to their individual needs. Digital enablers have a broad overview on all relevant technologies and tools so they can tailor those concepts. Digital Innovation Hubs will match both parties and will arrange the contractual and financial matters between the two parties, and provide support in the form of training and coaching. On average, the digital enablers will spend one month to prepare the concept for the company. At the end of the project, the Digital Innovation Hubs should provide recommendations whether the digital enablers scheme is useful. The tasks required are detailed in Section 2.2.

 

A Steering Committee has to be set up to supervise this initiative. It should be composed of four experts from government, academia, industry, associations. The composition of the Steering Committee should be agreed with the Commission one month after the start of the grant agreement, based on a list of at least ten suitable candidates proposed by the beneficiary to be included in its proposal.

 

A large part of the total financial resources of this pilot project (at least 70% of the available funding of €994.000; funding ratio 90% of eligible cost) should be devoted to digital enablers working for SMEs and mid-caps. The beneficiaries of the grant awarded under this call may provide support to third parties as described in Section 11.7d of this call for proposals. The support to third parties can only be provided in the form of grants.

 

The digital enablers should receive reasonable fees for their work, travel and subsistence.

 

2.2 Tasks

The project should support SMEs and mid-caps in their digitisation and internationalisation efforts by sending digital enablers for 1 month (in principle) to around 60 SMEs and mid-caps. The duration of the project should be around 18 months including a pilot phase from month one to month eight. The pilot phase runs in parallel to the main project, has shorter task periods and should address around 10 matched SMEs, mid-caps and digital enablers.

 

The following six activities need to be carried out:

Activity 1. Identifying and selecting suitable SMEs and mid-caps

It is required that a number of SMEs and mid-caps (at least 12; 4 per Digital Innovation Hub) has already been identified at the level of the proposal while for the remaining ones, the applicant will have to describe in its proposal the methodology that will be used to identify them.

The proposed methodology should follow an Expression of Interest (EoI) mechanism allowing interested SMEs and mid-caps to express their willingness in participating to the initiative. The proposal should already contain the EoI text, evaluation criteria, ranking procedures, foreseen dissemination actions, etc. to be able to engage SMEs and mid-caps. At least 9 information events in different Member States should be targeted.

The selection criteria (to be elaborated further by the applicant) that have to be used to identify SMEs and mid-caps should include the following ones:

1. The SME or mid-cap is:

•

In need of a digital transformation of its products, processes or business models in order to compete on international markets?

•

Active in a sector that is not yet highly digitised?

•

Lacking own resources to manage its digitisation?

•

Capable to work on a digitisation concept during the course of the project?

•

Committed to implement the recommended digitisation concept in a reasonable time frame?

2. Quality of the SME or mid-cap in terms of operational, technical, innovation, networking and business capacities and relevant position in its ecosystem.

Out of the at least 12 SMEs or mid-caps, two per Hub shall be proposed for the pilot phase.

Activity 2. Identifying and selecting suitable digital enablers

It is required that a number of digital enablers (at least 9; 3 per Digital Innovation Hub) has already been identified at the level of the proposal. For the remaining ones, the applicant will have to describe the methodology that will be used to identify them.

The proposed methodology should follow an Expression of Interest (EoI) mechanism allowing interested digital enablers to express their willingness in participating to the initiative. The proposal should already contain the EoI text, evaluation criteria, ranking procedures, etc and foreseen dissemination actions to be able to engage with digital enablers. At least 9 information events in different Member States should be targeted.

The selection criteria (to be elaborated further by the applicant) that have to be used to identify digital enablers should include the following ones:

1.  The digital enabler has:

•

Relevant educational background?

•

Relevant professional experience?

•

The necessary integrity, loyalty and neutrality to fulfil the task as this can be related to confidential information of the SME or mid-cap?

•

Relevant language skills as she or he has to work in another country?

Out of the at least 9 digital enablers, two per Hub shall be proposed for the pilot phase.

Activity 3. Matching SMEs and mid-caps with digital enablers

During the course of the project, the contractor has to submit a list of at least 100 matched pairs to the Steering Committee. The Steering Committee will then select together with the Commission around 60 pairs. Selection will be in accordance with the criteria above as well as the additional criteria proposed in the applicant's proposal.

The proposal has to feature at least 6 matched pairs (2 per Hub) for the pilot phase.

Activity 4. Execution of the individual digital enabler's activities

The selected pairs will carry out the following activities (supported by the beneficiaries with a training/coaching package) in a 6-month period (M11 to M16, with a pilot phase from M5 to M8):

1. In-depth analysis of the digitisation needs of the SME or mid-cap

2. Elaboration of a digitisation concept that enables the internationalisation of the SME or mid-cap

3. Implementation of the digitisation concept (if possible within 1 month)

The proposal has to feature at least 3 (1 per Hub) initial ideas of digitisation concepts which serve as point of reference in terms of quality and quantity for the remaining digitisation concepts.

The applicant will also inform, prepare and help SMEs, mid-caps and digital enablers regarding opportunities arising from calls in the H2020 programme, in particular Factories of the Future (FoF) and the Information and Communication Technologies - Leadership in Enabling and Industrial Technologies (ICT-LEIT) part.

 

Activity 5. Policy recommendations to uplift the competitiveness of SMEs and mid-caps

The beneficiaries will prepare a report containing:

• an overview of the state-of-play with respect to digitisation in the selected companies

• recommendations for improving the competitiveness of those companies and the sectors they belong to

• experience from the digital enablers scheme; lessons learned and recommendations regarding potential further development of this approach.

• The final recommendations should be presented in a workshop, at the end of the project.

Activity 6. Project coordination, management and reporting

This activity ensures effective coordination and collaboration between the beneficiaries, the third parties (the digital enablers and the companies) and Commission services, and monitors progress and effective and efficient use of resources.

Relevant Commission services should be regularly informed of the progress of this initiative and its final results.

 

Implementation period

The maximum duration of the project is expected to be 18 months, other durations may be foreseen if clearly justified;

 

Timetable

a) Publication of the call

1 December 2017

b) Deadline for submitting applications

31 January 2018 17:00 CET

c) Evaluation period

February/March 2018

d) Information to applicants

April 2018

e) Signature of grant agreement

May 2018

Budget available

The total budget earmarked for the co-financing of projects is estimated at EUR 994.000 (nine hundred and ninety-four thousand euros).

The Commission expects to fund one proposal.

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

Admissibility Requirements



Applications must be sent no later than the deadline for submitting applications referred to in section 3.



Applications must be submitted in writing (see section 14) and on usb key, using the application form available at https://ec.europa.eu/digital-single-market/news-redirect/607508



Applications must be drafted in one of the EU official languages. If the application is submitted in another language than English, please provide at least a summary of the action in English.

Failure to comply with those requirements will lead to the rejection of the application.

Eligibility Criteria

1.3.

Eligible applicants

Only applications from legal entities established in the EU Member States or associated countries are eligible.

Applications may be submitted:

– by a single legal entity;

– by a consortium made up of several legal entities; or

– by one applicant, whether established specifically or not for the action, which is formed of several legal entities complying with the eligibility, non-exclusion and selection criteria set out in this call for proposals, and implementing together the proposed action, provided the application identifies the said entities. For the purpose of declaring eligible costs as specified under section 11.1, the entities composing the applicant shall be treated as affiliated entities.

 

In order to assess the applicants' eligibility, the following supporting documents are requested:

Examples of supporting documents:

-

private entity: extract from the official journal, copy of articles of association, extract of trade or association register, certificate of liability to VAT (if, as in certain countries, the trade register number and VAT number are identical, only one of these documents is required);

- public entity: copy of the resolution, decision or other official document establishing the public-law entity ;



natural persons: photocopy of identity card and/or passport; certificate of liability to VAT, if applicable (e.g. some self-employed persons)

- entities without legal personality: documents providing evidence that their representative(s) have the capacity to undertake legal obligations on their behalf.

Eligible 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, may take part in the action as affiliated entities, and may declare eligible costs as specified in section 11.1. For that purpose, applicants shall identify such affiliated entities in the application form.

1.4.

Eligible activities

Types of activities eligible under this call for proposals:



cooperation projects;



conferences, seminars;



training activities;



awareness and dissemination actions;



actions aiming at the creation and improvement of networks, exchanges of good practices, brokering and matchmaking;



studies, analyses, mapping projects;



innovation activities



financial support to third parties (see point 11.8. d).

Exclusion Criteria

1.5.

Exclusion

The authorising officer shall exclude an applicant from participating in call for proposals procedures where:

(a) the applicant is bankrupt, subject to insolvency or winding-up procedures, where its assets are being administered by a liquidator or by a court, where it is in an arrangement with creditors, where its business activities are suspended, or where it is in any analogous situation arising from a similar procedure provided for under national laws or regulations;

(b) it has been established by a final judgment or a final administrative decision that the applicant is in breach of its obligations relating to the payment of taxes or social security contributions in accordance with the law of the country in which it is established, with those of the country in which the authorising officer is located or those of the country of the performance of the contract;

(c) it has been established by a final judgment or a final administrative decision that the applicant is guilty of grave professional misconduct by having violated applicable laws or regulations or ethical standards of the profession to which the applicant belongs, or by having engaged in any wrongful conduct which has an impact on its professional credibility where such conduct denotes wrongful intent or gross negligence, including, in particular, any of the following:

(i)

fraudulently or negligently misrepresenting information required for the verification of the absence of grounds for exclusion or the fulfilment of selection criteria or in the performance of a contract, a grant agreement or a grant decision;

(ii)

entering into agreement with other applicants with the aim of distorting competition;

(iii)

violating intellectual property rights;

(iv)

attempting to influence the decision-making process of the Commission during the award procedure;

(v)

attempting to obtain confidential information that may confer upon it undue advantages in the award procedure;

(d) it has been established by a final judgment that the applicant is guilty of any of the following:

(i)

fraud, within the meaning of Article 1 of the Convention on the protection of the European Communities' financial interests, drawn up by the Council Act of 26 July 1995;

(ii)

corruption, as defined in Article 3 of the Convention on the fight against corruption involving officials of the European Communities or officials of Member States of the European Union, drawn up by the Council Act of 26 May 1997, and in Article 2(1) of Council Framework Decision 2003/568/JHA, as well as corruption as defined in the law of the country where the contracting authority is located, the country in which the applicant is established or the country of the performance of the contract;

(iii)

participation in a criminal organisation, as defined in Article 2 of Council Framework Decision 2008/841/JHA;

(iv)

money laundering or terrorist financing, as defined in Article 1 of Directive 2005/60/EC of the European Parliament and of the Council;

(v)

terrorist-related offences or offences linked to terrorist activities, as defined in Articles 1 and 3 of Council Framework Decision 2002/475/JHA, respectively, or inciting, aiding, abetting or attempting to commit such offences, as referred to in Article 4 of that Decision;

(vi)

child labour or other forms of trafficking in human beings as defined in Article 2 of Directive 2011/36/EU of the European Parliament and of the Council;

(e) the applicant has shown significant deficiencies in complying with main obligations in the performance of a contract, a grant agreement or a grant decision financed by the Union's budget, which has led to its early termination or to the application of liquidated damages or other contractual penalties, or which has been discovered following checks, audits or investigations by an authorising officer, OLAF or the Court of Auditors;

(f) it has been established by a final judgment or final administrative decision that the applicant has committed an irregularity within the meaning of Article 1(2) of Council Regulation (EC, Euratom) No 2988/95.

(g) for the situations of grave professional misconduct, fraud, corruption, other criminal offences, significant deficiencies in the performance of the contract or irregularity, the applicant is subject to:

facts established in the context of audits or investigations carried out by the Court of Auditors, OLAF or internal audit, or any other check, audit or control performed under the responsibility of an authorising officer of an EU institution, of a European office or of an EU agency or body;

(ii)

non-final administrative decisions which may include disciplinary measures taken by the competent supervisory body responsible for the verification of the application of standards of professional ethics;

(iii)

decisions of the ECB, the EIB, the European Investment Fund or international organisations;

(iv)

decisions of the Commission relating to the infringement of the Union's competition rules or of a national competent authority relating to the infringement of Union or national competition law.

(v)

decisions of exclusion by an authorising officer of an EU institution, of a European office or of an EU agency or body.

 

 

Remedial measures

If an applicant declares one of the situations of exclusion listed above (see section 7.4), it should indicate the measures it has taken to remedy the exclusion situation, thus demonstrating its reliability. This may include e.g. technical, organisational and personnel measures to prevent further occurrence, compensation of damage or payment of fines. The relevant documentary evidence which illustrates the remedial measures taken must be provided in annex to the declaration. This does not apply for situations referred in point (d) of section 7.1.

1.7.

Rejection from the call for proposals

The authorising officer shall not award a grant to an applicant who:

a.

is in an exclusion situation established in accordance with section 7.1;

 

b.

has misrepresented the information required as a condition for participating in the procedure or has failed to supply that information;

 

c.

was previously involved in the preparation of calls for proposal documents where this entails a distortion of competition that cannot be remedied otherwise.

 

The same exclusion criteria apply to affiliated entities.

 

Administrative and financial penalties may be imposed on applicants, or affiliated entities where applicable, who are guilty of misrepresentation.

1.8.

Supporting documents

Applicants [and affiliated entities] must provide a declaration on their honour certifying that they are not in one of the situations referred to in articles 106(1) and 107 FR, by filling in the relevant form attached to the application form accompanying the call for proposals and available at https://ec.europa.eu/digital-single-market/news-redirect/607508.

 

This obligation may be fulfilled in one of the following ways:

 

a) for mono beneficiary grants

(i) the applicant signs a declaration in its name and on behalf of its affiliated entities OR

(ii) the applicant and its affiliated entities sign each a separate declaration in their own name

b) for multi beneficiaries grants

(i) the coordinator of a consortium signs a declaration on behalf of all applicants and their affiliated entities OR

(ii) each applicant in the consortium signs a declaration in its name and on behalf its affiliated entities OR

(iii) each applicant in the consortium and the affiliated entities sign each a separate declaration in their own name

Selection criteria

1.9.

Financial capacity

Applicants must have stable and sufficient sources of funding to maintain their activity throughout the duration of the grant and to participate in its funding. The applicants' financial capacity will be assessed on the basis of the following supporting documents to be submitted with the application:

a)

Low value grants (≤ EUR 60 000):



a declaration on their honour.



Grants ≥ EUR 60 000:



a declaration on their honour and

EITHER



the profit and loss account as well as the balance sheet for the last financial year for which the accounts were closed;



for newly created entities: the business plan might replace the above documents;

OR



the table provided for in the application form, filled in with the relevant statutory accounting figures, in order to calculate the ratios as detailed in the form.

b)

Grants for an action ≥ EUR 750 000:



the information and supporting documents mentioned above in point b) above and



an audit report produced by an approved external auditor certifying the accounts for the last financial year available. 

In the event of an application grouping several applicants (consortium), the above thresholds apply to each applicant.

In the case of legal entities forming one applicant (the "sole applicant"), as specified in section 6.1, the above requirements apply to each one of those entities.

 

On the basis of the documents submitted, if the responsible authorising officer (RAO) considers that financial capacity is weak, s/he may:



request further information;



decide not to give pre-financing;



decide to give pre-financing paid in instalments;



decide to give pre-financing covered by a bank guarantee (see section 11.6 below);



where applicable, require the joint and several financial liability of all the co-beneficiaries.

If the RAO considered that the financial capacity is insufficient s/he will reject the application.

1.10.

Operational capacity

Applicants must have the professional competencies as well as appropriate qualifications necessary to complete the proposed action. In this respect, applicants have to submit a declaration on their honour, and the following supporting documents:



curriculum vitae or description of the profile of the people primarily responsible for managing and implementing the operation (accompanied where appropriate, like in the field of research and education, by a list of relevant publications);



the organisation's activity reports;



an exhaustive lists of previous projects and activities performed and connected to the policy field of a given call or to the actions to be carried out;



an inventory of natural or economic resources involved in the project.

In the case of legal entities forming one applicant (the "sole" applicant), as specified in section 6.1, the above requirements apply to each one of those entities.

Award criteria

Eligible applications/projects will be assessed on the basis of the following criteria:

Award criterion

Maximum score/weighting

 

 

1. Excellence

1.1 Understanding of the objectives of this pilot project

1.2 Pertinence of the pilot phase concept and capacity to reach around 60 matched pairs based on existing broad contacts to SMEs, mid-caps and digital enablers

1.3 Quality and quantity of the submitted outlines of digitisation concepts (see section 5.2, activity 4)

1.4 Appropriateness and quality of the training/coaching packages

1.5 Overall soundness of the methodology

 

(All the sub-criteria above are of equal relative importance) 

Max 50/1

Threshold 25

2. Impact

2.1 Expected results and plans for dissemination of them

 

2.2 Sustainability of the achievements of the project

(exploitation plans of the digitisation concepts of the SMEs and mid-caps, and plans for the Digital Innovation Hubs to further use the results of the pilot project on Digital Enablers in SMEs.)

(All the sub-criteria above are of equal relative importance) 

Max 26/1

Threshold 13

 

3. Arrangements for monitoring/supervision of the operation and any risks involved in its implementation

3.1 coherence and effectiveness of the work plan, including appropriateness of the allocation of tasks and resources

3.2 complementarity of the participants within the consortium

3.3 appropriateness of the management structure and procedures, including risk and innovation management.

3.4 effective use of resources

(All the sub-criteria above are of equal relative importance)

Max 24/1

Threshold12

 

Total

Max 100

Threshold 60

 

Minimum score per criterion (threshold):

Proposals scoring less than 50% of the maximum score for any technical award criterion will be considered of insufficient quality and rejected.

Minimum total score (threshold):

Proposals with a total score of less than 60 points at the end of the evaluation process will be considered of insufficient quality and rejected.

 

 

 

Legal commitments

In the event of a grant awarded by the Commission, a grant agreement, drawn up in euro and detailing the conditions and level of funding, will be sent to the applicant, as well as the information on the procedure to formalise the agreement of the parties.  

The 2 copies of the original agreement must be signed first by the beneficiary on behalf of the consortium and returned to the Commission immediately. The Commission will sign it last.

In the event the application for framework partnership is selected, a framework partnership agreement detailing the conditions of cooperation will be sent to the applicant, as well as information on the procedure to formalise the agreement of the parties.

Financial provisions

11.1 Eligible costs

Eligible costs shall meet all the following criteria:

 they are incurred by the beneficiary.  

 they are incurred during the duration of the action, with the exception of costs relating to final reports and audit certificates;

o The period of eligibility of costs will start as specified in the grant agreement.

o If a beneficiary can demonstrate the need to start the action before the agreement is signed, the costs eligibility period may start before that signature. Under no circumstances can the eligibility period start before the date of submission of the grant application.

 they are indicated in the estimated budget;

 they are necessary for the implementation of the action which is the subject of the grant;

 they are identifiable and verifiable, in particular being recorded in the accounting records of the beneficiary and determined according to the applicable accounting standards of the country where the beneficiary is established and according to the usual cost accounting practices of the beneficiary;

 they comply with the requirements of applicable tax and social legislation;

 they are reasonable, justified, and comply with the requirements of sound financial management, in particular regarding economy and efficiency.

The beneficiary's internal accounting and auditing procedures must permit direct reconciliation of the costs and revenue declared in respect of the action/project with the corresponding accounting statements and supporting documents.

The same criteria apply to costs incurred by the affiliated entities.

Eligible costs may be direct or indirect.

 

11.1.1. Eligible direct costs

The eligible direct costs for the action are those costs which:

with due regard for the conditions of eligibility set out above, are identifiable as specific costs directly linked to the performance of the action and which can therefore be booked to it directly, such as :

(a) the costs of personnel working under an employment contract with the beneficiary or an equivalent appointing act and assigned to the action, provided that these costs are in line with the beneficiary’s usual policy on remuneration.

Those costs include actual salaries plus social security contributions and other statutory costs included in the remuneration. They may also comprise additional remunerations, including payments on the basis of supplementary contracts regardless of the nature of those contracts, provided that they are paid in a consistent manner whenever the same kind of work or expertise is required, independently from the source of funding used;

The costs of natural persons working under a contract with the beneficiary other than an employment contract or who are seconded to the beneficiary by a third party against payment may also be included under such personnel costs, provided that the following conditions are fulfilled:

(i) the person works under conditions similar to those of an employee (in particular regarding the way the work is organised, the tasks that are performed and the premises where they are performed);

(ii) the result of the work belongs to the beneficiary (unless exceptionally agreed otherwise); and

(iii) the costs are not significantly different from the costs of staff performing similar tasks under an employment contract with the beneficiary; 

The recommended methods for calculation of direct personnel costs are provided in Appendix.

(b) costs of travel and related subsistence allowances, provided that these costs are in line with the beneficiary’s usual practices on travel;

(c) the depreciation costs of equipment or other assets (new or second-hand) as recorded in the beneficiary’s accounting statements, provided that the asset:

(i) is written off in accordance with the international accounting standards and the beneficiary’s usual accounting practices; and

(ii) has been purchased in accordance with the rules on implementation contracts laid down in the grant agreement, if the purchase occurred within the implementation period;

The costs of renting or leasing equipment or other assets are also eligible, provided that these costs do not exceed the depreciation costs of similar equipment or assets and are exclusive of any finance fee;

Only the portion of the equipment’s depreciation, rental or lease costs corresponding to the implementation period and the rate of actual use for the purposes of the action may be taken into account when determining the eligible costs. By way of exception, the full cost of purchase of equipment may be eligible under the Special Conditions, if this is justified by the nature of the action and the context of the use of the equipment or assets;

(d) costs of consumables and supplies, provided that they:

(i) are purchased in accordance with the rules on implementation contracts laid down in the grant agreement; and

(ii) are directly assigned to the action;

(e) costs arising directly from requirements imposed by the Agreement (dissemination of information, specific evaluation of the action, audits, translations, reproduction), including the costs of requested financial guarantees, provided that the corresponding services are purchased in accordance with the rules on implementation contracts laid down in the grant agreement;

(f) costs entailed by subcontracts, provided that specific conditions on subcontracting as laid down in the grant agreement are met;

(g) costs of financial support to third parties, provided that the conditions laid down in the grant agreement are met;

(h) duties, taxes and charges paid by the beneficiary, notably value added tax (VAT), provided that they are included in eligible direct costs, and unless specified otherwise in the grant agreement.

 

11.1.2. Eligible indirect costs (overheads)

 

Indirect costs are costs that are not directly linked to the action implementation and therefore cannot be attributed directly to it.

 

A flat-rate amount of 7% of the total eligible direct costs of the action, is eligible as indirect costs, representing the beneficiary's general administrative costs which can be regarded as chargeable to the action/project.

 

Indirect costs may not include costs entered under another budget heading.

Applicants’ attention is drawn to the fact that if they are receiving an operating grant financed by the EU or Euratom budget, they may not declare indirect costs for the period(s) covered by the operating grant, unless they can demonstrate that the operating grant does not cover any costs of the action.

In order to demonstrate this, in principle, the beneficiary should: 

a. use analytical cost accounting that allows to separate all costs (including overheads) attributable to the operating grant and the action grant. For that purpose the beneficiary should use reliable accounting codes and allocation keys ensuring that the allocation of the costs is done in a fair, objective and realistic way.  

b. record separately:

 all costs incurred for the operating grants (i.e. personnel, general running costs and other operating costs linked to the part of its usual annual activities), and

 all costs incurred for the action grants (including the actual indirect costs linked to the action)

If the operating grant covers the entire usual annual activity and budget of the beneficiary, the latter is not entitled to receive any indirect costs under the action grant.

11.2 Ineligible costs

a) return on capital and dividends paid by a beneficiary;

b) debt and debt service charges;

c) provisions for losses or debts;

d) interest owed;

e) doubtful debts;

f) exchange losses;

g) costs of transfers from the Commission charged by the bank of a beneficiary;

h) costs declared by the beneficiary under another action receiving a grant financed from the Union budget. Such grants include grants awarded by a Member State and financed from the Union budget and grants awarded by bodies other than the Commission for the purpose of implementing the Union budget. In particular, beneficiaries receiving an operating grant financed by the EU or Euratom budget cannot declare indirect costs for the period(s) covered by the operating grant, unless they can demonstrate that the operating grant does not cover any costs of the action.

i) contributions in kind from third parties;

j) excessive or reckless expenditure;

11.3 Form of the grant

11.3.1 Reimbursement of costs actually incurred

 

The grant will be defined by applying a maximum co-financing rate of 90 % to the eligible costs actually incurred and declared by the beneficiary and its affiliated entities.

11.4 Balanced budget

The estimated budget of the action must be attached to the application form. It must have revenue and expenditure in balance.

The budget must be drawn up in euros.

 

Applicants for whom costs will not be incurred in euros should use the exchange rate published on the Infor-euro website available at: http://ec.europa.eu/budget/contracts_grants/info_contracts/inforeuro/inforeuro_en.cfm

The applicant must ensure that the resources which are necessary to carry out the action are not be entirely provided by the EU grant.

Co-financing of the action may take the form of:

 the beneficiary's own resources,

 income generated by the action or work programme,

 financial contributions from third parties.

Overall co-financing may also include in-kind contributions from third parties, i.e. non-financial resources made available free of charge by third parties to the beneficiary or to the consortium. The corresponding costs of third parties are not eligible under the grant, e.g. volunteer work, providing a meeting room for free, etc.

The value of the contribution in kind must not exceed:

 either the costs actually borne and duly supported by accounting documents;

 or, in the absence of such documents, the costs generally accepted on the market in question.

 

 In-kind contributions shall be presented separately in the estimated budget to reflect the total resources allocated to the action. Their unit value is evaluated in the provisional budget and shall not be subject to subsequent changes.

 In-kind contributions shall comply with national tax and social security rules.

11.5 Calculation of the final grant amount

The final amount of the grant is calculated by the Commission at the time of the payment of the balance. The calculation involves the following steps:

Step 1 — Application of the reimbursement rate to the eligible costs

The amount under step 1 is obtained by application of the reimbursement rate specified in section 11.3.1 to the eligible costs accepted by the Commission,

Step 2 — Limit to the maximum amount of the grant

The total amount paid to the beneficiaries by the Commission may in no circumstances exceed the maximum amount of the grant as indicated in the grant agreement. If the amount obtained following Step 1 is higher than this maximum amount, the final amount of the grant is limited to the latter.

Step 3 — Reduction due to the no-profit rule

‘Profit’ means the surplus of the amount obtained following Steps 1 and 2 plus the total receipts of the action, over the total eligible costs of the action.

The total eligible costs of the action are the consolidated total eligible costs approved by the Commission. The total receipts of the action are the consolidated total receipts established, generated or confirmed on the date on which the request for payment of the balance is drawn up by the beneficiary.

The following are considered receipts:

(a) income generated by the action;

(b) financial contributions given by third parties to a beneficiary or to an affiliated entity, if they are specifically assigned by the third parties to the financing of the eligible costs of the action reimbursed by the Commission.

The following are not considered receipts:

(a) financial contributions by third parties, if they may be used to cover costs other than the eligible costs under the grant agreement;

(b) financial contributions by third parties with no obligation to repay any amount unused at the end of the implementation period.

If there is a profit, it will be deducted in proportion to the final rate of reimbursement of the actual eligible costs of the action approved by the Commission.]

Step 4 — Reduction due to improper implementation or breach of other obligations.

The Commission may reduce the maximum amount of the grant if the action has not been implemented properly (i.e. if it has not been implemented or has been implemented poorly, partially or late), or if another obligation under the Agreement has been breached.

The amount of the reduction will be proportionate to the degree to which the action has been implemented improperly or to the seriousness of the breach.

11.6 Reporting and payment arrangements

11.6.1 The beneficiary may request the following payments provided that the conditions of the grant agreement are fulfilled (e.g. payment deadlines, ceilings, etc.). The payment requests shall be accompanied by the documents provided below and detailed in the grant agreement:

Payment request

Accompanying documents

A pre-financing payment corresponding to 80% of the grant amount

(a) bank guarantee (see section 11.6.2)

Payment of the balance

The Commission will establish the amount of this payment on the basis of the calculation of the final grant amount (see section 11.5 above). If the total of earlier payments is higher than the final grant amount, the beneficiary will be required to reimburse the amount paid in excess by the Commission through a recovery order

 

(a) final technical report;

(b) final financial statement;

(c) summary financial statement aggregating the financial statements already submitted previously and indicating the receipts

(d) a certificate on the financial statements and underlying accounts 

In case of a weak financial capacity section 8.1 above applies. 

11.6.2 Pre-financing guarantee

A pre-financing guarantee for up to the same amount as the pre-financing may be requested in order to limit the financial risks linked to the pre-financing payment.

The financial guarantee, in euro, shall be provided by an approved bank or financial institution established in one of the EU Member States. When the beneficiary is established in a third country, the Commission may agree that a bank or financial institution established in that third country may provide the guarantee if it considers that the bank or financial institution offers equivalent security and characteristics as those offered by a bank or financial institution established in a Member State. Amounts blocked in bank accounts shall not be accepted as financial guarantees.

The guarantee may be replaced by:

 a joint and several guarantee by a third party or,

 a joint guarantee of the beneficiaries of an action who are parties to the same grant agreement.

The guarantee shall be released as the pre-financing is gradually cleared against interim payments or the payment of the balance, in accordance with the conditions laid down in the grant agreement.

 

 

11.7 Other financial conditions

a) Non-cumulative award

An action may only receive one grant from the EU budget.

In no circumstances shall the same costs be financed twice by the Union budget. To ensure this, applicants shall indicate in the grant application the sources and amounts of Union funding received or applied for the same action or part of the action or for its (the applicant's) functioning during the same financial year as well as any other funding received or applied for the same action.

b) Non-retroactivity

No grant may be awarded retrospectively for actions already completed.

A 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.

In such cases, costs eligible for financing may not have been incurred prior to the date of submission of the grant application.

 

c) Implementation contracts/subcontracting

Where the implementation of the action requires the award of procurement contracts (implementation contracts), the beneficiary must award the contract to the bid offering best value for money or the lowest price (as appropriate), avoiding conflicts of interests.

The beneficiary is expected to clearly document the tendering procedure and retain the documentation for the event of an audit.

Entities acting in their capacity of contracting authorities in the meaning of Directive 2014/24/EU or contracting entities in the meaning of Directive 2014/25/EU must comply with the applicable national public procurement rules.

Beneficiaries may subcontract tasks forming part of the action. If they do so, they must ensure that, in addition to the above-mentioned conditions of best value for money and absence of conflicts of interests, the following conditions are also complied with:

a) subcontracting does not cover core tasks of the action;

b) recourse to subcontracting is justified because of the nature of the action and what is necessary for its implementation;

c) the estimated costs of the subcontracting are clearly identifiable in the estimated budget;

d) any recourse to subcontracting, if not provided for in description of the action, is communicated by the beneficiary and approved by the Commission. The Commission may grant approval:

(i) before any recourse to subcontracting, if the beneficiaries requests an amendment

(ii) after recourse to subcontracting if the subcontracting:

 is specifically justified in the interim or final technical report and

 does not entail changes to the grant agreement which would call into question the decision awarding the grant or be contrary to the equal treatment of applicants;

e) the beneficiaries ensure that certain conditions applicable to beneficiaries, enumerated in the grant agreement (e.g. visibility, confidentiality, etc.), are also applicable to the subcontractors.

 

d) Financial support to third parties

The applications may envisage provision of financial support to third parties.

In such case the applications must include:

 an exhaustive list of the types of activities for which a third party may receive financial support [out of the following fixed list]:

• o travel and subsistence of the digital enabler to work for a company to develop a digitisation concept or to participate in training and dissemination activities

 financial reward for the activities carried out by the digital enabler to develop a digitisation concept for a company or to participate in training and dissemination activities

 the definition of the persons or categories of persons which may receive financial support [out of the following categories]:

 Companies of which their employers will act as a digital enabler

 Natural persons that will act as a digital enabler

 the criteria for awarding financial support

 The best digital enablers that will match the needs of the companies receiving the digital enablers will be funded, as described in activity 3..

 the maximum amount to be granted to each third party and the criteria for determining it is as follows:

The maximum amount is set lower than 60 000 EUR per third party and the amount is determined by the payments to the digital enabler.

 

12. Publicity

 

12.1 By the beneficiaries

Beneficiaries must clearly acknowledge the European Union’s contribution in all publications or in conjunction with activities for which the grant is used.

In this respect, beneficiaries are required to give prominence to the name and emblem of the European Commission on all their publications, posters, programmes and other products realised under the co-financed project.

 

12.2 By the Commission

With the exception of scholarships paid to natural persons and other direct support paid to natural persons in most need, all information relating to grants awarded in the course of a financial year shall be published on an internet site of the European Union institutions no later than the 30 June of the year following the financial year in which the grants were awarded.

The Commission will publish the following information:

 name of the beneficiary;

 address of the beneficiary when the latter is a legal person, region when the beneficiary is a natural person, as defined on NUTS 2 level if he/she is domiciled within EU or equivalent if domiciled outside EU;

 subject of the grant;

 amount awarded.

Upon a reasoned and duly substantiated request by the beneficiary, the publication shall be waived if such disclosure risks threatening the rights and freedoms of individuals concerned as protected by the Charter of Fundamental Rights of the European Union or harm the commercial interests of the beneficiaries.

 

13. PROCESSING OF PERSONAL DATA

The reply to any call for proposals involves the recording and processing of personal data (such as name, address and CV). Such data will be processed pursuant to Regulation (EC) No 45/2001 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. Unless indicated otherwise, the questions and any personal data requested that are required to evaluate the application in accordance with the call for proposal will be processed solely for that purpose by the Technologies & Systems for Digitising Industry Unit of the Communications Networks, Content and Technology DG.

Personal data may be registered in the Early Detection and Exclusion System by the Commission, should the beneficiary be in one of the situations mentioned in Article 106(1) and 107 of the Financial Regulation 966/2012 (for more information see the Privacy Statement on:

http://ec.europa.eu/budget/library/explained/management/protecting/privacy_statement_edes_en.pdf).

 

14. PROCEDURE FOR THE SUBMISSION OF PROPOSALS

Proposals must be submitted by the deadline set out under section 3.

No modification to the application is allowed once the deadline for submission has elapsed. However, if there is a need to clarify certain aspects or to correct clerical mistakes, the Commission may contact the applicant during the evaluation process.

Applicants will be informed in writing about the results of the selection process.

 

Submission on paper

Application forms are available at https://ec.europa.eu/digital-single-market/news-redirect/607508

Applications must be submitted in the correct form, duly completed and dated. They must be submitted in four copies (one original clearly identified as such, plus three copies) and signed by the person authorised to enter into legally binding commitments on behalf of the applicant organisation.

Where applicable, all additional information considered necessary by the applicant can be included on separate sheets.

Please include the following marking on the envelope: "DE SMEs"

Applications must be sent to the following postal address:

by registered post, date as postmark or by courier service, date of receipt by the courier service;

European Commission

Directorate-General for Communications Networks, Content and Technology

Directorate Digital Industry (unit Photonics – A.4)

For the attention of the Head of Unit

1049 Brussels, Belgium

or, by hand delivery by 17.00 on 31/01/2018 at the latest to the following address:

European Commission

Directorate-General for Communications Networks, Content and Technology
Directorate Digital Industry (unit Photonics – A.4)

For the attention of Head of Unit
Avenue du Bourget 1 B –1140 Brussels (Evere), Belgium

 

In this case, a receipt must be obtained as proof of submission, signed and dated by the official in the Commission's central mail department who took delivery.

 

The department is open from 08.00 to 17.00 Monday to Thursday, and from 8.00 to 16.00 on Fridays. It is closed on Saturdays, Sundays and Commission holidays. Please note that in this case it is the date and time of reception at the Commission services that will count, not the actual date on which it was dispatched.

Applications sent by fax or e-mail will not be accepted.

Contacts

For any questions please contact:
CNECT-PHOTONICS-EVALUATIONS@EC.EUROPA.EU

 

Annexes:

 Application form (including checklist for applicants)

 Model grant agreement

 Model budget

 Declaration on Honour

Public link:   Only for registered users