Other Participants: Associated Partners, In-Kind Third Parties, Subcontractors, Recipients (Article 9)

ARTICLE 9

OTHER PARTICIPANTS INVOLVED IN THE ACTION

9.1 Associated partners [OPTION 1 for programmes without associated partners: Not applicable ] [OPTION 2 for programmes with associated partners (standard): [OPTION 1 if selected for the grant: The following entities which cooperate with a beneficiary will participate in the action as ‘associated partners’: - [AP legal name (short name)], PIC [number] [associated partner of [BEN legal name (short name)]] - [AP legal name (short name)], PIC [number] [associated partner of [BEN legal name (short name)]] [same for more AP] Associated partners must implement the action tasks attributed to them in Annex 1 in accordance with Article 11. They may not charge costs or contributions to the action and the costs for their tasks are not eligible. The tasks must be set out in Annex 1. The beneficiaries must ensure that their contractual obligations under Articles 11 (proper implementation), 12 (conflict of interests), 13 (confidentiality and security), 14 (ethics), 17.2 (visibility), 18 (specific rules for carrying out action), 19 (information) and 20 (record-keeping) also apply to the associated partners. The beneficiaries must ensure that the bodies mentioned in Article 25 (e.g. granting authority, OLAF, Court of Auditors (ECA), etc.) can exercise their rights also towards the associated partners.] [OPTION 2: Not applicable] ]

1. Associated partners Associated partners are entities that implement action tasks, but without receiving EU funding.

They do not become party to the Grant Agreement (do not sign an accession form), but they implement parts of the action and are thus often involved actively in the consortium. Therefore, the Grant Agreement mentions them by name and defines their role (rights and obligations).

Characteristics of implementation by associated partners:

▪ They do not sign the Grant Agreement (and are therefore not beneficiaries).

▪ They perform action tasks attributed to them in the DoA Annex 1.

▪ They participate at own costs (do not receive EU funding).

▪ The consortium (or, in case the associated partner cooperates with a specific beneficiary as named in Article 9.1, that beneficiary) remains responsible towards the granting authority for the work performed by the associated partners.

Associated partners do NOT need to have a (capital or legal) link to any beneficiary (but they may have one).

Since they do not receive EU funding, associated partners do NOT have to comply with the eligibility conditions (but they may)).

Associated partners must be listed in Article 9.1, their tasks must be mentioned in Annex 1.

The beneficiaries are responsible for the proper implementation of the tasks implemented by associated partners (proper quality, timely delivery, etc).

They must moreover ensure that they comply with certain obligations:

Obligations that must be extended to associated partners:

▪ Proper implementation (see Article 11), including compliance with call conditions

▪ Avoiding conflict of interest (see Article 12)

▪ Confidentiality and security obligations (see Article 13)

▪ Ethics and values (see Article 14)

▪ Give visibility to the EU funding (see Article 17.2)

▪ Respect specific9 rules for the action implementation (see Article 18), including compliance with specific rules set out in Annex 5

▪ Information obligations (see Article 19)

▪ Record-keeping (see Article 20).

It is the beneficiaries’ responsibility to ensure that these obligations are accepted by the associated partners (e.g. via contractual arrangements, consortium agreement, etc).

The beneficiaries must also ensure that the associated partners respect the call conditions and Annex 5.

Example

In Horizon Europe, the Grant Agreement provides for additional obligations in Annex 5 regarding results, e.g. open access to peer-reviewed scientific publications which applies to all such publications under the Grant Agreement, including publications where associated partners are involved.

Moreover, the beneficiaries must ensure that the bodies mentioned in Article 25 (e.g. granting authority, the European Court of Auditors (ECA), the European Anti-Fraud Office (OLAF)) have the right to carry out checks, reviews, audits and investigations on the associated partners, particular concerning the action implementation.

9.2 Third parties giving in-kind contributions [OPTION 1 for programmes with in-kind contributions allowed but not eligible (standard): Other third parties may give in-kind contributions to the action (i.e. personnel, equipment, other goods, works and services, etc. which are free-of-charge), if necessary for the implementation. Third parties giving in-kind contributions do not implement any action tasks. They may not charge costs or contributions to the action and the costs for the in-kind contributions are not eligible. The third parties and their in-kind contributions should be set out in Annex 1.] [OPTION 2 for programmes with in-kind contributions eligible: Other third parties may give in-kind contributions to the action (i.e. personnel, equipment, other goods, works and services, etc. which are free-of-charge) if necessary for the implementation. Third parties giving in-kind contributions do not implement any action tasks. They may not charge costs or contributions to the action, but the costs for the in-kind contributions are eligible and may be charged by the beneficiaries which use them, under the conditions set out in Article 6. The costs will be included in Annex 2 as part of the beneficiaries’ costs. The third parties and their in-kind contributions should be set out in Annex 1. The beneficiaries must ensure that the bodies mentioned in Article 25 (e.g. granting authority, OLAF, Court of Auditors (ECA), etc.) can exercise their rights also towards the third parties giving in-kind contributions. ] [OPTION 3 for programmes with in-kind contributions not allowed: In-kind contributions (i.e. personnel, equipment, other goods and services, etc. given by third parties free-of-charge) are not allowed for the implementation of the action.]

1. Third parties providing in-kind contributions: In-kind contributions allowed but not eligible This is the standard rule for most EU programmes. Beneficiaries may use in-kind contributions provided by third parties, if necessary to implement the action, but they are not counted towards the project budget (not eligible costs).

Examples (in-kind contributions allowed but not eligible): 1. Civil servant working as a professor in a public university is also working on the action. His salary is paid not by the beneficiary (the university) but by the government (the ministry). It can therefore not be charged to the EU grant. 2. A entity providing learning spaces for free to the beneficiaries, for example a municipality for an NGO part of the project. 3. A graphic company providing for free the design of booklets.

In-kind contributions refers only to the case where a third party makes available some of its resources to a beneficiary for free (i.e. without any payment; new for 2021-2027). In this case, the beneficiary itself makes no payment and there is therefore NO cost incurred by the beneficiary. There are therefore normally NO costs that can be charged to the action (— unless specifically provided for in the Programme Regulation, e.g. for HE). By contrast, if there is any payment by the beneficiary to the third party for the in-kind contribution provided, the beneficiary can declare the costs in the appropriate cost category: − personnel costs for seconded persons (see Article 6.2.A.3) − renting costs for equipment (see Article 6.2.C.2) or − purchase costs for other goods, works and services (see Article 6.2.C.3).

2. Third parties providing in-kind contributions: In-kind contributions eligible For some EU programmes (only HE), the Programme Regulation (basic act) allows in-kind contribution costs to be charged to the action.

Examples (in-kind contributions eligible): Civil servant working as a professor in a public university is also working on the action. His salary is paid not by the beneficiary (the university) but by the government (the ministry). In Horizon Europe, the beneficiary may charge these costs to the grant, even if they are incurred by a third party (the ministry/government).

The eligibility conditions for such costs are set out in Article 6.1. However, in kind contributions against payment ARE NOT a budget category: Depending on the type of cost, they must be declared in, and comply with, the fitting budget category (e.g. personnel costs, equipment).

In-kind contributions and the third parties contributing them must be mentioned in Annex 1 (simplified approval procedure; see below).

Moreover, if in-kind contributions are charged to the action, the beneficiaries must also ensure that the bodies mentioned in Article 25 (e.g. granting authority, the European Court of Auditors (ECA), the European Anti-Fraud Office (OLAF)) have the right to carry out checks, reviews, audits and investigations on the third parties, and in particular to audit their costs. If access is denied by the third party, the costs will be rejected.

Specific cases (in-kind contributions eligible): Simplified approval procedure (new in-kind contributions) — For programmes where in-kind contributions are eligible (only HE), if the need for an in-kind contribution was not known at grant signature, the coordinator must request an amendment in order to introduce the new contribution into the Annex 1 (see Article 39) or flag it in the periodic report (simplified approval procedure; for details, see Article 6.1). In the latter case, the beneficiaries bear however the risk that the granting authority might not approve the new contribution and reject the costs at interim or final payment-stage later on.

9.3 Subcontractors [OPTION 1 for programmes without subcontractors (ineligible): Not applicable ] [OPTION 2 for programmes with subcontractors (standard): Subcontractors may participate in the action, if necessary for the implementation. Subcontractors must implement their action tasks in accordance with Article 11. The costs for the subcontracted tasks (invoiced price from the subcontractor) are eligible and may be charged by the beneficiaries, under the conditions set out in Article 6. The costs will be included in Annex 2 as part of the beneficiaries’ costs. The beneficiaries must ensure that their contractual obligations under Articles 11 (proper implementation), 12 (conflict of interest), 13 (confidentiality and security), 14 (ethics), 17.2 (visibility), 18 (specific rules for carrying out action), 19 (information) and 20 (record-keeping) also apply to the subcontractors. The beneficiaries must ensure that the bodies mentioned in Article 25 (e.g. granting authority, OLAF, Court of Auditors (ECA), etc.) can exercise their rights also towards the subcontractors. ]

1. Subcontractors Subcontractors do not become party to the Grant Agreement (do not sign the GA), but they often implement important parts of the action (i.e. action tasks specified in Annex 1) and thus may need to be involved actively in the consortium. Therefore, the Grant Agreement mentions them and defines their role (rights and obligations).

Characteristics of subcontractors:

▪ They do not sign the Grant Agreement (and are therefore not beneficiaries).

▪ They perform action tasks attributed to them in the DoA Annex 1.

▪ charges a price, which usually includes a profit (— this distinguishes it from affiliated entities; see Article 8), to be declared as subcontracting costs by a beneficiary.

▪ The work is carried out without the direct supervision of the beneficiary and is not hierarchically subordinate to the beneficiary (— this distinguishes it from action tasks implemented by in-house consultants; see Article 6.2.A.2).

▪ The motivation is pecuniary, not the work on the project itself. The subcontractor is paid by the beneficiary in exchange for its work.

▪ The beneficiary remains fully responsible towards the granting authority for action tasks performed by its subcontractors.

Example: subcontract

A Grant Agreement for an action on nature reserves describes in Annex 1 two action tasks. The first task concerns a comparative study of water quality in the reserve, which the beneficiary’s employee will compile after taking and sending water samples to laboratories. The lab work is necessary for the implementation of the action but only a subactivity of compiling the study (the action task), therefore it will fall under purchase costs (see Article 6.2.C). The second task concerns an aerial survey of the water bodies for which the beneficiary does not have the necessary know-how and assets and therefore subcontracts to a service provider who will implement the survey (the action task) through activities like aerial photography and analysis.

The action tasks to be subcontracted and the estimated costs (not necessarily the subcontractor, especially if not known yet) must be identified and justified in Annex 1 (Article 6.2.B; simplified approval procedure; see below).

Normally you are NOT obliged to give information about the names of the subcontractors selected (in DoA Annex 1 or periodic report), but many programmes require this information indirectly through the detailed budget/cost reporting table. Best practice: If you think that there is an issue with a subcontractor that might impact the eligibility of subcontracting costs (e.g. potential conflict of interest; subcontractor not in compliance with the call conditions or subject to sanctions, etc), inform the granting authority and ask for specific guidance.

The beneficiaries are responsible for the proper implementation of the subcontracted action tasks by the subcontractors (proper quality, timely delivery, etc).

They must moreover ensure that they comply with certain obligations:

Obligations that must be extended to subcontractors:

▪ Proper implementation (see Article 11), including compliance with call conditions

▪ Avoiding conflict of interest (see Article 12)

▪ Confidentiality and security obligations (see Article 13)

▪ Ethics and values (see Article 14)

▪ Give visibility to the EU funding (see Article 17.2)

▪ Respect specific rules for the action implementation (see Article 18), including compliance with specific rules set out in Annex 5

▪ Information obligations (see Article 19)

▪ Record-keeping (see Article 20).

It is the beneficiaries’ responsibility to ensure that these obligations are accepted by the subcontractors (e.g. via contractual arrangements, consortium agreement, etc).

The beneficiaries must also ensure that the subcontractors respect the the call conditions and Annex 5.

Moreover, the beneficiaries must ensure that that the bodies mentioned in Article 25 (e.g. granting authority, the European Court of Auditors (ECA), the European Anti-Fraud Office (OLAF)) have the right to carry out checks, reviews, audits and investigations on the subcontractors, and in particular to audit the payments received. If access is denied by the subcontractor, the costs will be rejected.

Specific cases (subcontractors): Simplified approval procedure (new subcontracts) — If the need for a subcontract was not known at grant signature, the coordinator must request an amendment in order to introduce the subcontracting of one or more tasks in Annex 1 (see Article 39) or, if allowed, flag it in the periodic report (simplified approval procedure; allowed for most programmes; for details, see Article 6.1). In the latter case, the beneficiaries bear however the risk that the granting authority might not approve the new subcontracting of the task(s) and reject the costs at interim or final payment-stage later on.

9.4 Recipients of financial support to third parties [OPTION 1 for programmes without financial support to third parties: Not applicable ] [OPTION 2 for programmes with financial support to third parties: If the action includes providing financial support to third parties (e.g. grants, prizes or similar forms of support), the beneficiaries must ensure that their contractual obligations under Articles 12 (conflict of interest), 13 (confidentiality and security), 14 (ethics), 17.2 (visibility), 18 (specific rules for carrying out action), 19 (information) and 20 (record-keeping) also apply to the third parties receiving the support (recipients). The beneficiaries must also ensure that the bodies mentioned in Article 25 (e.g. granting authority, OLAF, Court of Auditors (ECA), etc.) can exercise their rights also towards the recipients.]

1. Recipients of financial support to third parties (FSTP) Recipients of financial support to third parties (grants, prizes or other) do not become party to the Grant Agreement (do not sign the GA) and are not part of the consortium. They do not implement action tasks, but they benefit from them and receive (indirectly) a part of the EU funding. Therefore, the Grant Agreement defines their role (rights and obligations).

Characteristics of FSTP recipients:

▪ They do not sign the Grant Agreement (and are therefore not beneficiaries).

▪ They do not perform action tasks, but the financial support given to them is part of an action task specified in the DoA Annex 1.

▪ They receive financial support from the grant (e.g. sub-grant or prize money), to be declared as financial support to third parties cost by a beneficiary.

The beneficiaries remain responsible towards the granting authority for the proper use of the funding by the recipients.

They must moreover ensure that they comply with certain obligations, where relevant/applicable based on the nature of the action:

Obligations that must be extended to FSTP recipients:

▪ Avoiding conflict of interest (see Article 12)

▪ Confidentiality and security obligations (see Article 13)

▪ Ethics and values (see Article 14)

▪ Give visibility to the EU funding, as appropriate (see Article 17.2)

▪ Respect specific rules for the action implementation (see Article 18)

▪ Information obligations (see Article 19)

▪ Record-keeping (see Article 20).

It is the beneficiaries’ responsibility to ensure that these obligations are accepted by the recipients (e.g. via cascading call conditions or contractual arrangements, scholarship agreement, rules of contest, etc).

Moreover, the beneficiaries must also ensure that the bodies mentioned in Article 25 (e.g. granting authority, the European Court of Auditors (ECA), the European Anti-Fraud Office (OLAF)) have the right to carry out checks, reviews, audits and investigations on the recipients, and in particular to audit the payments received. If access is denied by the recipient, the costs will be rejected.

For general guidance on financial support to third parties, see Guidance on good practices for implementing FSTP in EU grants.