FRAMEWORK PARTNERSHIP AGREEMENT. NUMBER Enterprise Europe Network (EEN)

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1 Framework Partnership Agreement number: HCE EUROPEAN COMMISSION Executive Agency for Small and Medium-sized Enterprises (EASME) Director FRAMEWORK PARTNERSHIP AGREEMENT NUMBER Enterprise Europe Network (EEN) This Framework Partnership Agreement is between the following parties: on the one part, the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), represented for the purposes of signature of this Framework Partnership Agreement by Mr Patrick LAMBERT, Director, or his duly authorised representative, and on the other part, 1. the coordinator : Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag (HTD) KFT, , established in Ipar street 5., Budapest HU-1095, Hungary, HU , represented for the purposes of signing the Framework Partnership Agreement by PLSIGN, Róbert KIRÁLYFALVI and the following other partners if they have signed their Accession Form (see Annex 3 and Article 55): 2. ATEKNEA SOLUTIONS HUNGARY KFT (ATEKNEA) KFT, , established in TETENYI UT 84-86, BUDAPEST 1119, Hungary, HU , 3. FEJER MEGYEI KERESKEDELMI ES IPARKAMARA (FMKIK), /1062, established in HOSSZUSETATER 4-6, SZEKESFEHERVAR 8000, Hungary, HU , 4. GYOR-MOSON-SOPRON MEGYEI KERESKEDELMI ES IPARKAMARA (Győr-Moson- Sopron Megyei Kereskedelmi és Iparkamara), /1355, established in SZENT ISTVAN U 10A, GYOR 9021, Hungary, HU , 5. ZALA MEGYEI VALLALKOZASFEJLESZTESI ALAPITVANY (ZMVA) HU6, 60042, established in Koztarsasaag ut. 17 Pf 116, ZALAEGERSZEG 8900, Hungary, HU , 6. PECS-BARANYAI KERESKEDELMI ES IPARKAMARA (PECS-BARANYAI KERESKEDELMI ES IPARKAMARA), 1216, established in MAJOROSSY IMRE U 36, PECS 7625, Hungary, HU , 7. HAJDU-BIHAR MEGYEI KERESKEDELMI ES IPARKAMARA (HAJDU-BIHAR MEGYEI KERESKEDELMI ES IPARKAMARA), , established in PETOFI TER 10, DEBRECEN 4025, Hungary, HU , 8. PRIMOM FOUNDATION FOR ENTERPRISE PROMOTION OF SZABOLCS SZATMAR BEREG COUNTY BT (PRIMOM SZABOLCS-SZATMAR-BEREG MEGYEI VALLALKOZASELENKITO ALAPITVANY) HU6, /28, established in VACI MIHALY STREET 41, NYIREGYHAZA 4400, Hungary, 1

2 Framework Partnership Agreement number: HCE 9. CSONGRAD MEGYEI KERESKEDELMI ES IPARKAMARA (CSMKIK), , established in PARIZSI KRT 8-12, SZEGED 6721, Hungary, HU , Unless otherwise specified, references to partner or partners include the coordinator. The parties referred to above have agreed to enter into the Framework Partnership Agreement under the terms and conditions below. The Framework Partnership Agreement is composed of: Terms and Conditions Annex 1 Annex 2a Implementation Strategy Model Specific Agreement for COSME EEN actions Annex 1 Annex 2 Annex 3 Annex 4 Description of the specific action Estimated budget for the specific action Model for the financial statements Model for the certificate on the financial statements Annex 2b Model Specific Agreement for Horizon 2020 EEN actions Annex 1 Annex 2 Annex 3 Annex 4 Description of the specific action Estimated budget for the specific action Model for the financial statements Model for the certificate on the financial statements Annex 3 Annex 4 Accession Forms Model for the certificate on the methodology 2

3 Framework Partnership Agreement number: HCE TERMS AND CONDITIONS TABLE OF CONTENTS CHAPTER 1 GENERAL...8 ARTICLE 1 SUBJECT MATTER OF THE AGREEMENT...8 CHAPTER 2 FRAMEWORK PARTNERSHIP... 8 ARTICLE 2 IMPLEMENTATION STRATEGY AWARD OF SPECIFIC GRANTS SPECIFIC AGREEMENTS Implementation strategy Award of specific grants for specific actions Specific Agreements... 8 ARTICLE 3 DURATION AND STARTING DATE OF THE FRAMEWORK PARTERNSHIP...8 ARTICLE 4 RIGHTS AND OBLIGATIONS UNDER THE FRAMEWORK PARTNERSHIP Obligation to properly implement the framework partnership Consortium agreement...9 ARTICLE 5 SUSPENSION OF FRAMEWORK PARTNERSHIP IMPLEMENTATION...9 ARTICLE 6 TERMINATION OF THE FRAMEWORK PARTNERSHIP AGREEMENT OR OF PARTICIPATION OF ONE OR MORE PARTNERS Termination of the Agreement Termination of the participation of one or more partners...10 CHAPTER 3 SPECIFIC GRANTS...10 SECTION 1 SPECIFIC ACTIONS ARTICLE 7 SPECIFIC ACTIONS TO BE IMPLEMENTED...10 ARTICLE 8 DURATION OF THE SPECIFIC ACTIONS ARTICLE 9 ESTIMATED BUDGET AND BUDGET TRANSFERS Estimated budget Budget transfers...11 SECTION 2 SPECIFIC GRANTS...11 ARTICLE 10 GRANT AMOUNT, FORM OF GRANT, REIMBURSEMENT RATES AND FORMS OF COSTS Maximum grant amount Form of grant, reimbursement rates and form(s) of costs Final grant amount Calculation...11 ARTICLE 11 ELIGIBLE AND INELIGIBLE COSTS Eligible costs

4 Framework Partnership Agreement number: HCE 11.2 Ineligible costs Consequences of declaration of ineligible costs SECTION 3 RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THE SPECIFIC GRANTS SUBSECTION 1 RIGHTS AND OBLIGATIONS RELATED TO IMPLEMENTING THE SPECIFIC ACTIONS ARTICLE 12 GENERAL OBLIGATION TO PROPERLY IMPLEMENT THE SPECIFIC ACTIONS General obligation to properly implement the actions Consequences of non-compliance ARTICLE 13 RESOURCES TO IMPLEMENT THE SPECIFIC ACTIONS THIRD PARTIES INVOLVED IN THE SPECIFIC ACTIONS...12 ARTICLE 14 IMPLEMENTATION OF ACTION TASKS BY PARTNERS NOT RECEIVING EU FUNDING...12 ARTICLE 15 PURCHASE OF GOODS, WORKS OR SERVICES ARTICLE 16 USE OF IN-KIND CONTRIBUTIONS PROVIDED BY THIRD PARTIES AGAINST PAYMENT...13 ARTICLE 17 USE OF IN-KIND CONTRIBUTIONS PROVIDED BY THIRD PARTIES FREE OF CHARGE ARTICLE 18 IMPLEMENTATION OF ACTION TASKS BY SUBCONTRACTORS...13 ARTICLE 19 IMPLEMENTATION OF ACTION TASKS BY LINKED THIRD PARTIES SUBSECTION 2 RIGHTS AND OBLIGATIONS RELATED TO THE GRANT ADMINISTRATION ARTICLE 23 GENERAL OBLIGATION TO INFORM General obligation to provide information upon request Obligation to keep information up to date and to inform about events and circumstances likely to affect the Agreements Consequences of non-compliance ARTICLE 24 KEEPING RECORDS SUPPORTING DOCUMENTATION Obligation to keep records and other supporting documentation Consequences of non-compliance ARTICLE 25 SUBMISSION OF DELIVERABLES ARTICLE 26 REPORTING PAYMENT REQUESTS ARTICLE 27 PAYMENTS AND PAYMENT ARRANGEMENTS...16 ARTICLE 28 CHECKS, REVIEWS, AUDITS AND INVESTIGATIONS EXTENSION OF FINDINGS Checks, reviews and audits by the Agency and the Commission Investigations by OLAF Checks and audits by the European Court of Auditors (ECA)

5 Framework Partnership Agreement number: HCE 28.4 Checks, reviews, audits and investigations for international organisations Consequences of findings in checks, reviews, audits and investigations Extension of findings Consequences of non-compliance ARTICLE 29 EVALUATION OF THE IMPACT OF THE SPECIFIC ACTIONS Right to evaluate the impact of the specific actions Consequences of non-compliance SUBSECTION 3 RIGHTS AND OBLIGATIONS RELATED TO PRE-EXISTING RIGHTS (BACKGROUND) AND RESULTS OF THE SPECIFIC ACTIONS ARTICLE 30 PRE-EXISTING RIGHTS (BACKGROUND) AND OWNERSHIP OF THE RESULTS (INCLUDING INTELLECTUAL PROPERTY RIGHTS)...22 SUBSECTION 4 OTHER RIGHTS AND OBLIGATIONS...22 ARTICLE 34 CONFLICT OF INTERESTS Obligation to avoid a conflict of interests Consequences of non-compliance ARTICLE 35 CONFIDENTIALITY...22 ARTICLE 37 PROMOTING THE ACTION VISIBILITY OF EU FUNDING Communication activities by partners Communication activities by the Agency Consequences of non-compliance ARTICLE 38 PROCESSING OF PERSONAL DATA Processing of personal data by the Agency and the Commission Processing of personal data by the partners Consequences of non-compliance ARTICLE 39 ASSIGNMENTS OF CLAIMS FOR PAYMENT AGAINST THE AGENCY...25 SECTION 4 DIVISION OF PARTNERS ROLES AND RESPONSIBILITIES ARTICLE 40 DIVISION OF PARTNERS ROLES AND RESPONSIBILITIES Roles and responsibilities towards the Agency Internal division of roles and responsibilities Internal arrangements Consortium agreement SECTION 5 REJECTION OF COSTS REDUCTION OF THE GRANT RECOVERY PENALTIES DAMAGES SUSPENSION TERMINATION FORCE MAJEURE...27 SUBSECTION 1 REJECTION OF COSTS REDUCTION OF THE GRANT RECOVERY PENALTIES...27 ARTICLE 41 REJECTION OF INELIGIBLE COSTS Conditions Ineligible costs to be rejected Calculation Procedure

6 Framework Partnership Agreement number: HCE 41.3 Effects ARTICLE 42 REDUCTION OF THE GRANT Conditions Amount to be reduced Calculation Procedure Effects ARTICLE 43 RECOVERY OF UNDUE AMOUNTS ARTICLE 44 ADMINISTRATIVE AND FINANCIAL PENALTIES Conditions Duration Amount of penalty Calculation Procedure SUBSECTION 2 LIABILITY FOR DAMAGES ARTICLE 45 LIABILITY FOR DAMAGES Liability of the Agency Liability of the partners...31 SUBSECTION 3 SUSPENSION AND TERMINATION ARTICLE 46 SUSPENSION OF PAYMENT DEADLIN Conditions Procedure ARTICLE 47 SUSPENSION OF PAYMENTS Conditions Procedure ARTICLE 48 SUSPENSION OF THE ACTION IMPLEMENTATION Suspension of the action implementation, by the partners Suspension of the action implementation, by the Agency...34 ARTICLE 49 TERMINATION OF THE SPECIFIC AGREEMENT OR OF THE PARTICIPATION OF ONE OR MORE PARTNERS Termination of the Specific Agreement, by the partners Termination of the participation of one or more partners, by the partners Termination of the Specific Agreement or the participation of one or more partners, by the Agency SUBSECTION 4 FORCE MAJEURE ARTICLE 50 FORCE MAJEURE CHAPTER 4 FINAL PROVISIONS...39 ARTICLE 51 COMMUNICATIONS BETWEEN THE PARTIES Form and means of communications

7 Framework Partnership Agreement number: HCE 51.2 Date of communications Addresses for communication...40 ARTICLE 52 INTERPRETATION OF THE FRAMEWORK PARTNERSHIP AGREEMENT AND THE SPECIFIC AGREEMENTS Precedence of the Terms and Conditions over the Annexes Precedence of the Terms and Conditions of the Specific Agreements over the Framework Partnership Agreement ARTICLE 53 CALCULATION OF PERIODS, DATES AND DEADLINES ARTICLE 54 AMENDMENTS TO THE FRAMEWORK PARTNERSHIP AGREEMENT AND THE SPECIFIC AGREEMENTS Conditions Procedure ARTICLE 55 ACCESSION TO THE FRAMEWORK PARTNERSHIP AGREEMENT AND THE SPECIFIC AGREEMENTS Accession of the partners mentioned in the preamble Addition of new partners ARTICLE 56 APPLICABLE LAW AND SETTLEMENT OF DISPUTES Applicable law Dispute settlement ARTICLE 57 ENTRY INTO FORCE OF THE FRAMEWORK PARTNERSHIP AGREEMENT

8 Framework Partnership Agreement number: HCE CHAPTER 1 GENERAL ARTICLE 1 SUBJECT MATTER OF THE AGREEMENT This Agreement establishes a long term cooperation with the Enterprise Europe Network ( framework partnership ) and sets out its terms and conditions and the general terms and conditions and rights and obligations applicable to the specific grants that may be awarded by the Agency, for the specific actions under the framework partnership. CHAPTER 2 FRAMEWORK PARTNERSHIP ARTICLE 2 IMPLEMENTATION STRATEGY AWARD OF SPECIFIC GRANTS SPECIFIC AGREEMENTS 2.1 Implementation strategy The objectives and activities under the framework partnership are set out in the implementation strategy in Annex Award of specific grants for specific actions Specific Agreements The Agency may award specific grants under the Horizon 2020 and COSME programmes, for EEN actions to be implemented under the framework partnership ( specific actions ). In order to obtain proposals for specific grants, the Agency will consult the partners on the basis of an invitation to submit a proposal that sets out the award criteria it will apply. This invitation will be open to all the partners for which this type of action is included in the implementation strategy (see Annex 1) and who have signed a Framework Partnership Agreement. The partners are not obliged to respond to such consultations and may choose not to submit any proposal. The Agency will decide on the award of the specific grants following an evaluation of the proposal. If the Agency decides to award a specific grant, it will propose the partners to conclude a Specific Agreement (EEN SGA) (see Annexes 2a and 2b). By entering into the Specific Agreement, the partners accept the specific grant and agree to implement the specific action under their own responsibility and in accordance with the Framework Partnership Agreement and this Specific Agreement, with all the obligations and conditions they set out. Specific Agreements must be concluded before the end of the framework partnership (see Article 3). After the end of the framework partnership or its termination, the Framework Partnership Agreement continues to apply to specific actions that are implemented under Specific Agreements which have entered into force before end of the duration. ARTICLE 3 DURATION AND STARTING DATE OF THE FRAMEWORK PARTERNSHIP The Framework Partnership Agreement shall be concluded for a period of 72 months (6 years), from its entry into force (see Article 57). This period cannot be extended. 8

9 Framework Partnership Agreement number: HCE ARTICLE 4 RIGHTS AND OBLIGATIONS UNDER THE FRAMEWORK PARTNERSHIP 4.1 Obligation to properly implement the framework partnership The partners must respect the objectives of the framework partnership and implement it as described in Annex 1 and endeavour to achieve those objectives also in the specific actions. The partners must maintain relations of mutual co-operation and regular and transparent exchanges of information with the Agency on: - the implementation and follow-up of the implementation strategy and the specific grants and - other matters of common interest related to the Framework Partnership Agreement. 4.2 Consortium agreement The partners must implement the framework partnership in compliance with Articles 34, 35, 37, 38, 45 mutatis mutandis The partners must have internal arrangements regarding their operation and co-ordination to ensure that the framework partnership and the specific actions are implemented properly. These internal arrangements must be set out in a written consortium agreement between the partners, which may cover: - internal organisation of the consortium; - management of access to the electronic exchange system; - distribution of EU funding; - additional rules on rights and obligations related to background and results (including whether access rights remain or not, if a partner is in breach of its obligations) (see Subsection 3 of Chapter 3); - settlement of internal disputes; - liability, indemnification and confidentiality arrangements between the partners. The consortium agreement must not contain any provision contrary to the Framework Partnership Agreement and the Specific Agreements. ARTICLE 5 SUSPENSION OF FRAMEWORK PARTNERSHIP IMPLEMENTATION The parties may suspend the implementation of the framework partnership on the grounds and according to the procedure mutatis mutandis set out in Article 48. If the Agency suspends the framework partnership implementation, all specific actions are also deemed suspended (see Article 48), from the date of suspension of the framework partnership. 9

10 Framework Partnership Agreement number: HCE ARTICLE 6 TERMINATION OF THE FRAMEWORK PARTNERSHIP AGREEMENT OR OF PARTICIPATION OF ONE OR MORE PARTNERS 6.1 Termination of the Agreement The parties may terminate the Framework Partnership Agreement at any time. The party terminating the Framework Partnership Agreement must formally notify termination to the other party, stating the date the termination will take effect. This date must be after the notification. Termination of the Framework Partnership Agreement does not release the parties from their obligations under Specific Agreements which have entered into force before the date on which the termination takes effect, unless they have been terminated. Neither party may claim damages due to termination by the other party. 6.2 Termination of the participation of one or more partners The parties may terminate participation of one or more partners in the framework partnership on the grounds and according to the procedures mutatis mutandis set out in Article , and The coordinator must submit a request for amendment (see Article 54) to adapt Annex 1 and, if necessary, the addition of one or more new partners (see Article 55). If the request for amendment is rejected by the Agency, the Framework Partnership Agreement may be terminated (see above). Termination of participation in the framework partnership does not release the partner concerned from its obligations under Specific Agreements. It cannot however participate in specific actions awarded after the date on which the termination takes effect. CHAPTER 3 SPECIFIC GRANTS SECTION 1 SPECIFIC ACTIONS ARTICLE 7 SPECIFIC ACTIONS TO BE IMPLEMENTED The specific actions to be implemented are set out in the Specific Agreements (see Article 2 and Annex 1 EEN SGAs). ARTICLE 8 DURATION OF THE SPECIFIC ACTIONS The duration of the specific actions is set out in the Specific Agreements (see Article 3 EEN SGAs). ARTICLE 9 ESTIMATED BUDGET AND BUDGET TRANSFERS 9.1 Estimated budget The estimated budget for the specific actions is set out in Annex 2 to the Specific Agreements. 10

11 Framework Partnership Agreement number: HCE It contains the estimated eligible costs and the forms of costs, broken down by partner and budget category (Articles 4, 5, 6, 7 EEN SGAs). It also contains the estimated costs of the partners not receiving EU funding, if applicable (see Article 7 EEN SGAs). 9.2 Budget transfers The estimated budget breakdown indicated in Annex 2 to the Specific Agreements may be adjusted by transfers of amounts between partners or between budget categories (or both). This does not require an amendment according to Article 54, if the action is implemented as described in Annex 1 to the Specific Agreements. However, the partners may not add costs relating to subcontracts not provided for in Annex 1 to the Specific Agreements, unless such additional subcontracts are approved in accordance with Article Lump sums set out in Annex 2 to the Specific Agreements can never be adjusted. SECTION 2 SPECIFIC GRANTS ARTICLE 10 GRANT AMOUNT, FORM OF GRANT, REIMBURSEMENT RATES AND FORMS OF COSTS 10.1 Maximum grant amount The maximum grant amount for the specific grants is set out in the Specific Agreements (see Article 4 EEN SGAs) Form of grant, reimbursement rates and form(s) of costs The form of the grant, reimbursement rate(s), estimated eligible costs and the form(s) of costs of the specific grants are set out in the Specific Agreements (see Article 4 EEN SGAs) Final grant amount Calculation The final grant amount of a specific grant depends on the actual extent to which the specific action is implemented in accordance with the terms and conditions of the Framework Partnership Agreement and the Specific Agreement concerned. This amount is calculated by the Agency when the payment of the balance is made (see Article 15 EEN SGAs) in the following steps: Step 1 Application of the reimbursement rates to the eligible costs Step 2 Limit to the maximum grant amount Step 3 Reduction due to the no-profit rule Step 4 Reduction due to improper implementation or breach of other obligations The detailed calculation is set out in the Specific Agreements (see Article 4 EEN SGAs). 11

12 Framework Partnership Agreement number: HCE ARTICLE 11 ELIGIBLE AND INELIGIBLE COSTS 11.1 Eligible costs The general and specific conditions for costs to be eligible under the specific grants are set out in the Specific Agreements (see Article 5 EEN SGAs) Ineligible costs The conditions under which costs are considered ineligible under the specific grants are set out in the Specific Agreements (see Article 5 EEN SGAs) Consequences of declaration of ineligible costs Declared costs that are ineligible will be rejected (see Article 41). This may also lead to any of the other measures described in Section 5. SECTION 3 RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THE SPECIFIC GRANTS SUBSECTION 1 RIGHTS AND OBLIGATIONS RELATED TO IMPLEMENTING THE SPECIFIC ACTIONS ARTICLE 12 GENERAL OBLIGATION TO PROPERLY IMPLEMENT THE SPECIFIC ACTIONS 12.1 General obligation to properly implement the actions The partners must implement the specific actions as described in Annex 1 to the Specific Agreements and in compliance with the provisions of the Framework Partnership Agreement and the Specific Agreements and all legal obligations under applicable EU, international and national law Consequences of non-compliance If a partner breaches any of its obligations under this Article, the specific grants may be reduced (see Article 42). Such breaches may also lead to any of the other measures described in Section 5. ARTICLE 13 RESOURCES TO IMPLEMENT THE SPECIFIC ACTIONS THIRD PARTIES INVOLVED IN THE SPECIFIC ACTIONS The rules on the resources to implement the specific actions and involvement of third parties in the action are set out in the Specific Agreements (see Article 6 EEN SGAs). ARTICLE 14 IMPLEMENTATION OF ACTION TASKS BY PARTNERS NOT RECEIVING EU FUNDING The Specific Agreements may provide for rules for the implementation of action tasks by partners not receiving EU funding (see Article 7 EEN SGAs). 12

13 Framework Partnership Agreement number: HCE ARTICLE 15 PURCHASE OF GOODS, WORKS OR SERVICES The rules for the purchase of goods works and services are set out in the Specific Agreements (see Article 8 EEN SGAs). ARTICLE 16 USE OF IN-KIND CONTRIBUTIONS PROVIDED BY THIRD PARTIES AGAINST PAYMENT The H2020 Specific Agreements may provide for rules for the use of in-kind contributions provided by third parties against payment (see Article 9 EEN SGA H2020). ARTICLE 17 USE OF IN-KIND CONTRIBUTIONS PROVIDED BY THIRD PARTIES FREE OF CHARGE The H2020 Specific Agreements may provide for rules for the use of in-kind contributions provided by third parties free of charge (see Article 10 EEN SGA H2020). ARTICLE 18 IMPLEMENTATION OF ACTION TASKS BY SUBCONTRACTORS The rules for subcontracting action tasks are set out in the Specific Agreements (see Article 11 EEN SGAs). ARTICLE 19 IMPLEMENTATION OF ACTION TASKS BY LINKED THIRD PARTIES Not applicable ARTICLE 20 FINANCIAL SUPPORT TO THIRD PARTIES Not applicable ARTICLE 21 SUPPORT TO OR IMPLEMENTATION OF TRANS-NATIONAL PROJECTS Not applicable ARTICLE 22 PROVISION OF TRANS-NATIONAL OR VIRTUAL ACCESS TO RESEARCH INFRASTRUCTURES Not applicable SUBSECTION 2 RIGHTS AND OBLIGATIONS RELATED TO THE GRANT ADMINISTRATION ARTICLE 23 GENERAL OBLIGATION TO INFORM 23.1 General obligation to provide information upon request The partners must provide during implementation of the specific actions or afterwards and in accordance with Article 40.1 any information requested in order to verify eligibility of the costs, 13

14 Framework Partnership Agreement number: HCE proper implementation of the specific actions and compliance with any other obligations under the Framework Partnership Agreement or the Specific Agreements Obligation to keep information up to date and to inform about events and circumstances likely to affect the Agreements Each partner must keep information stored in the Beneficiary Register (via the electronic exchange system; see Article 51) up to date, in particular, its name, address, legal representatives, legal form and organisation type. Each partner must immediately inform the coordinator which must immediately inform the Agency and the other partners of any of the following: (a) events which are likely to affect significantly or delay the implementation of a specific action and the EU's financial interests, in particular: (i) changes in its legal, financial, technical, organisational or ownership situation (b) circumstances affecting: (i) (ii) the decision to award a specific grant and the Framework Partnership Agreement, or compliance with requirements under the Framework Partnership Agreement or the Specific Agreements Consequences of non-compliance If a partner breaches any of its obligations under this Article, the specific grant may be reduced (see Article 42). Such breaches may also lead to any of the other measures described in Section 5. ARTICLE 24 KEEPING RECORDS SUPPORTING DOCUMENTATION 24.1 Obligation to keep records and other supporting documentation For each specific grant, the partners must for a period of five years (and, for low value specific grants 2, three years) after the payment of the balance keep records and other supporting documentation in order to prove the proper implementation of the specific action and the costs they declare as eligible. They must make them available upon request (see Article 23) or in the context of checks, reviews, audits or investigations (see Article 28). If there are on-going checks, reviews, audits, investigations, litigation or other pursuits of claims under a Specific Agreement (including the extension of findings; see Article 28), the partners must keep the records and other supporting documentation until the end of these procedures. 2 For the definition, see Article 185 of Commission Delegated Regulation (EU) No 1268/2012 of 29 October 2012 on the rules of application of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council on the financial rules applicable to the general budget of the Union (OJ L 362, , p. 1) ( Rules of Application Regulation No 1268/2012 ): low value grants are lower or equal to EUR

15 Framework Partnership Agreement number: HCE The partners must keep the original documents. Digital and digitalised documents are considered originals if they are authorised by the applicable national law. The Agency may accept non-original documents if it considers that they offer a comparable level of assurance Records and other supporting documentation on the scientific and technical implementation The partners must keep records and other supporting documentation on scientific and technical implementation of the specific action in line with the accepted standards in the respective field Records and other documentation to support the costs declared The partners must keep the records and documentation supporting the costs declared, in particular the following: (a) for actual costs: adequate records and other supporting documentation to prove the costs declared, such as contracts, subcontracts, invoices and accounting records. In addition, the partners' usual cost accounting practices and internal control procedures must enable direct reconciliation between the amounts declared, the amounts recorded in their accounts and the amounts stated in the supporting documentation; (b) for unit costs: adequate records and other supporting documentation to prove the number of units declared. Partners do not need to identify the actual eligible costs covered or to keep or provide supporting documentation (such as accounting statements) to prove the amount per unit. In addition, where direct personnel costs are declared as unit costs calculated in accordance with the partner's usual cost accounting practices, the partners must keep adequate records and documentation to prove that the cost accounting practices used comply with the eligibility conditions set out in the Specific Agreements (see Point A of Article 5.2 EEN SGAs). The partners may submit to the Commission, for approval, a certificate (drawn up in accordance with Annex 4) stating that their usual cost accounting practices comply with these conditions ( certificate on the methodology ). If the certificate is approved, costs declared in line with this methodology will not be challenged subsequently, unless the partners have concealed information for the purpose of the approval. (c) for flat-rate costs: adequate records and other supporting documentation to prove the eligibility of the costs to which the flat-rate is applied. The partners do not need to identify the costs covered or provide supporting documentation (such as accounting statements) to prove the amount declared at a flat-rate; (d) for lump sum costs: adequate records and other supporting documentation to prove that the corresponding tasks or part of the specific action as described in Annex 1 to the Specific Agreement concerned were implemented properly. The partners do not need to identify the actual eligible costs covered or provide supporting documentation (such as accounting statements) to prove the amount declared as a lump sum. In addition, for personnel costs (declared as actual costs or on the basis of unit costs), the partners must keep time records for the number of hours declared. The time records must be in writing and 15

16 Framework Partnership Agreement number: HCE approved by the persons working on the specific action and their supervisors, at least monthly. In the absence of reliable time records of the hours worked on the specific action, the Agency may accept alternative evidence supporting the number of hours declared, if it considers that it offers an adequate level of assurance. As an exception, for persons working exclusively on the specific action, there is no need to keep time records, if the partner signs a declaration confirming that the persons concerned have worked exclusively on the this action Consequences of non-compliance If a partner breaches any of its obligations under this Article, costs insufficiently substantiated will be ineligible (see Article 5 EEN SGAs) and will be rejected (see Article 41), and the specific grant may be reduced (see Article 42). Such breaches may also lead to any of the other measures described in Section 5. ARTICLE 25 SUBMISSION OF DELIVERABLES The provisions on submission of deliverables for the specific grants are set out in the Specific Agreements (see Article 13 EEN SGAs). ARTICLE 26 REPORTING PAYMENT REQUESTS The provisions on reporting and payment requests for the specific grants are set out in the Specific Agreements (see Article 14 EEN SGAs). ARTICLE 27 PAYMENTS AND PAYMENT ARRANGEMENTS The provisions on payments and payment arrangements for the specific grants are set out in the Specific Agreements (see Article 15 EEN SGAs). ARTICLE 28 CHECKS, REVIEWS, AUDITS AND INVESTIGATIONS EXTENSION OF FINDINGS 28.1 Checks, reviews and audits by the Agency and the Commission Right to carry out checks The Agency or the Commission will during the implementation of the specific actions or afterwards check the proper implementation of the specific actions and compliance with the obligations under the Framework Partnership Agreement and the Specific Agreements, including assessing deliverables and reports. For this purpose the Agency or the Commission may be assisted by external persons or bodies. The Agency or the Commission may also request additional information in accordance with Article 23. The Agency or the Commission may request partners to provide such information to it directly. Information provided must be accurate, precise and complete and in the format requested, including electronic format. 16

17 Framework Partnership Agreement number: HCE Right to carry out reviews The Agency or the Commission may during the implementation of the specific actions or afterwards carry out reviews on the proper implementation of the specific actions (including assessment of deliverables and reports), compliance with the obligations under the Framework Partnership Agreement and the Specific Agreements and continued scientific or technological relevance of Horizon 2020 specific actions. Reviews may be started: - for Horizon 2020 specific grants, up to two years - for COSME low value grants, up to three years - for other COSME specific grants, up to five years They will be formally notified to the coordinator or partner concerned and will be considered to have started on the date of the formal notification. If the review is carried out on a third party (see Articles 15 to 19), the partner concerned must inform the third party. The Agency or the Commission may carry out reviews directly (using its own staff) or indirectly (using external persons or bodies appointed to do so). It will inform the coordinator or partner concerned of the identity of the external persons or bodies. They have the right to object to the appointment on grounds of commercial confidentiality. The coordinator or partner concerned must provide within the deadline requested any information and data in addition to deliverables and reports already submitted (including information on the use of resources). The Agency or the Commission may request partners to provide such information to it directly. The coordinator or partner concerned may be requested to participate in meetings, including with external experts. For on-the-spot reviews, the partners must allow access to their sites and premises, including to external persons or bodies, and must ensure that information requested is readily available. Information provided must be accurate, precise and complete and in the format requested, including electronic format. On the basis of the review findings, a review report will be drawn up. The Agency or the Commission will formally notify the review report to the coordinator or partner concerned, which has 30 days to formally notify observations ( contradictory review procedure ). Reviews (including review reports) are in the language of the Specific Agreements. 17

18 Framework Partnership Agreement number: HCE Right to carry out audits The Agency or the Commission may during the implementation of the specific actions or afterwards carry out audits on the proper implementation of the specific actions and compliance with the obligations under the Framework Partnership Agreement and the Specific Agreements. Audits may be started: - for Horizon 2020 specific grants, up to two years - for COSME low value grants, up to three years - for other COSME specific grants, up to five years after the payment of the balance. They will be formally notified to the coordinator or partner concerned and will be considered to have started on the date of the formal notification. If the audit is carried out on a third party (see Articles 15 to 19), the partner concerned must inform the third party. The Agency or the Commission may carry out audits directly (using its own staff) or indirectly (using external persons or bodies appointed to do so). It will inform the coordinator or partner concerned of the identity of the external persons or bodies. They have the right to object to the appointment on grounds of commercial confidentiality. The coordinator or partner concerned must provide within the deadline requested any information (including complete accounts, individual salary statements or other personal data) to verify compliance with the Framework Partnership Agreement and Specific Agreements. The Agency or the Commission may request partners to provide such information to it directly. For on-the-spot audits, the partners must allow access to their sites and premises, including to external persons or bodies, and must ensure that information requested is readily available. Information provided must be accurate, precise and complete and in the format requested, including electronic format. On the basis of the audit findings, a draft audit report will be drawn up. The Agency or the Commission will formally notify the draft audit report to the coordinator or partner concerned, which has 30 days to formally notify observations ( contradictory audit procedure ). This period may be extended by the Commission Agency or the in justified cases. The final audit report will take into account observations by the coordinator or partner concerned. The report will be formally notified to it. Audits (including audit reports) are in the language of the Specific Agreements. The Agency or the Commission may also access the partners statutory records for the periodical assessment of unit costs, flat-rate amounts or lump sums. 18

19 Framework Partnership Agreement number: HCE 28.2 Investigations by OLAF Under Regulations No 883/ and No 2185/96 4 (and in accordance with their provisions and procedures), the European Anti-Fraud Office (OLAF) may at any moment during implementation of the specific actions or afterwards carry out investigations, including on-the-spot checks and inspections, to establish whether, there has been fraud, corruption or any other illegal activity under the Framework Partnership Agreement or Specific Agreements affecting the financial interests of the EU Checks and audits by the European Court of Auditors (ECA) Under Article 287 of the Treaty on the Functioning of the European Union (TFEU) and Article 161 of the Financial Regulation No 966/2012 5, the European Court of Auditors (ECA) may at any moment during implementation of the specific actions or afterwards carry out audits. The ECA has the right of access for the purpose of checks and audits Checks, reviews, audits and investigations for international organisations Not applicable 28.5 Consequences of findings in checks, reviews, audits and investigations Extension of findings Findings in a specific grant Findings in checks, reviews, audits or investigations carried out in the context of a specific grant may lead to the rejection of ineligible costs (see Article 48), reduction of the specific grant (see Article 49), recovery of undue amounts (see Article 50) or to any of the other measures described in Section 5. Rejection of costs or reduction of the specific grant after the payment of the balance will lead to a revised final grant amount (see Article 4 SGA). Findings in checks, reviews, audits or investigations may lead to a request for amendment for the modification of Annex 1 to the Specific Agreement (see Article 61). Checks, reviews, audits or investigations that find systemic or recurrent errors, irregularities, fraud or breach of obligations may also lead to consequences in other EU or Euratom grants awarded under similar conditions ( extension of findings from the specific grant to other grants ). Moreover, findings arising from an OLAF investigation may lead to criminal prosecution under national law. 3 Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999 (OJ L 248, , p. 1). 4 Council Regulation (Euratom, EC) No 2185/1996 of 11 November 1996 concerning on-the-spot checks and inspections carried out by the Commission in order to protect the European Communities' financial interests against fraud and other irregularities (OJ L 292, , p. 2). 5 Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council of 25 October 2012 on the financial rules applicable to the general budget of the Union and repealing Council Regulation (EC, Euratom) No 1605/2002 (OJ L 298, , p. 1). 19

20 Framework Partnership Agreement number: HCE Findings in other grants The Agency or the Commission may extend findings from other grants to a specific grant ( extension of findings from other grants to a specific grant ), if: (a) the partner concerned is found, in other EU or Euratom grants awarded under similar conditions, to have committed systemic or recurrent errors, irregularities, fraud or breach of obligations that have a material impact on the specific grant and (b) those findings are formally notified to the partner concerned together with the list of grants affected by the findings no later than: - for Horizon 2020 specific grants, two years - for COSME low value grants, three years - for other COSME specific grants, five years after the payment of the balance of the specific grant. The extension of findings may lead to the rejection of costs (see Article 41) reduction of the specific grant (see Article 42), recovery of undue amounts (see Article 43), suspension of the action implementation (see Article 48) or termination of the specific grant (see Article 49) Procedure The Agency or the Commission will formally notify the partner concerned the systemic or recurrent errors and its intention to extend these audit findings, together with the list of grants affected If the findings concern eligibility of costs: the formal notification will include: (a) an invitation to submit observations on the list of grants affected by the findings; (b) the request to submit revised financial statements for all grants affected; (c) the correction rate for extrapolation established by the Agency or the Commission on the basis of the systemic or recurrent errors, to calculate the amounts to be rejected if the partner concerned: (i) (ii) considers that the submission of revised financial statements is not possible or practicable or does not submit revised financial statements. The partner concerned has 90 days from receiving notification to submit observations, revised financial statements or to propose a duly substantiated alternative correction method. This period may be extended by the Agency or the Commission in justified cases. The Agency or the Commission may then start a rejection procedure in accordance with the procedure set out in Article 41, either on the basis of the revised financial statements or the rate announced. 20

21 Framework Partnership Agreement number: HCE If the findings concern improper implementation or breach of another obligations: the formal notification will include: (a) an invitation to submit observations on the list of grants affected by the findings and (b) the flat-rate the Agency or the Commission intends to apply according to the principle of proportionality. The partner concerned has 90 days from receiving notification to submit observations or to propose a duly substantiated alternative flat-rate. The Agency or the Commission may then start a reduction procedure in accordance with the procedure set out in Article 42, either on the basis of the alternative flat-rate or the flat-rate announced Consequences of non-compliance If a partner breaches any of its obligations under this Article, any insufficiently substantiated costs will be ineligible (see Article 5 EEN SGAs) and will be rejected (see Article 41). Such breaches may also lead to any of the other measures described in Section 5. ARTICLE 29 EVALUATION OF THE IMPACT OF THE SPECIFIC ACTIONS 29.1 Right to evaluate the impact of the specific actions The Agency or the Commission may carry out interim and final evaluations of the impact of the specific actions, measured against the objective of the EU programme. Evaluations may be started during implementation of the specific actions and up to a period of five years (and, for low value specific grants, three years) after the payment of the balance. The evaluation is considered to start on the date of the formal notification to the coordinator or partners. The Agency or the Commission may make these evaluations directly (using its own staff) or indirectly (using external bodies or persons it has authorised to do so). The coordinator or partners must provide any information requested to evaluate the impact of the specific actions, including information in electronic format Consequences of non-compliance If a partner breaches any of its obligations under this Article, the Agency may apply the measures described in Section 5. SUBSECTION 3 RIGHTS AND OBLIGATIONS RELATED TO PRE-EXISTING RIGHTS (BACKGROUND) AND RESULTS OF THE SPECIFIC ACTIONS 21

22 Framework Partnership Agreement number: HCE ARTICLE 30 PRE-EXISTING RIGHTS (BACKGROUND) AND OWNERSHIP OF THE RESULTS (INCLUDING INTELLECTUAL PROPERTY RIGHTS) The rights and obligations related to pre-existing rights (background) and results of the specific actions are set out in the Specific Agreements (see Articles 16-16h EEN SGA H2020 /Article 16 EEN SGA COSME). SUBSECTION 4 OTHER RIGHTS AND OBLIGATIONS ARTICLE 31 RECRUITMENT AND WORKING CONDITIONS FOR RESEARCHERS Not applicable ARTICLE 32 GENDER EQUALITY Not applicable ARTICLE 33 ETHICS Not applicable ARTICLE 34 CONFLICT OF INTERESTS 34.1 Obligation to avoid a conflict of interests The partners must take all measures to prevent any situation where the impartial and objective implementation of the specific actions is compromised for reasons involving economic interest, political or national affinity, family or emotional ties or any other shared interest ( conflict of interests ). They must formally notify to the Agency without delay any situation constituting or likely to lead to a conflict of interests and immediately take all the necessary steps to rectify this situation. The Agency may verify that the measures taken are appropriate and may require additional measures to be taken by a specified deadline Consequences of non-compliance If a partner breaches any of its obligations under this Article, the grant may be reduced (see Article 42) and the Specific Agreement or participation of the partner may be terminated (see Article 49). Such breaches may also lead to any of the other measures described in Section 5. ARTICLE 35 CONFIDENTIALITY The rules on confidentiality are set out in the Specific Agreements (see Article 17 EEN SGAs). ARTICLE 36 SECURITY-RELATED OBLIGATIONS Not applicable 22

23 Framework Partnership Agreement number: HCE ARTICLE 37 PROMOTING THE ACTION VISIBILITY OF EU FUNDING 37.1 Communication activities by partners Obligation to promote the specific actions and their results The partners must promote the specific actions and their results by providing targeted information to multiple audiences (including the media and the public) in a strategic and effective manner. Before engaging in a communication activity expected to have a major media impact, the partners must inform the Agency (see Article 51) Information on EU funding Obligation and right to use the EU emblem Unless the Agency requests or agrees otherwise or unless it is impossible, any communication activity related to the action (including at conferences, seminars, in information material, such as brochures, leaflets, posters, presentations, etc in electronic form, via social media, etc.) and any infrastructure, equipment and major results funded by the grant must: (a) display the EU emblem and (b) include the following text: For communication activities: This project has received funding from the European Union s [Horizon 2020 research and innovation programme][cosme Programme ( )] under grant agreement No [number]. For infrastructure, equipment and major results: This [infrastructure][equipment][insert type of result] is part of a project that has received funding from the European Union s [Horizon 2020 research and innovation programme][cosme programme ( )] under grant agreement No [number]. When displayed together with another logo, the EU emblem must have appropriate prominence. For the purposes of their obligations under this Article, the partners may use the EU emblem without first obtaining approval from the Agency. This does not, however, give them the right to exclusive use. Moreover, they may not appropriate the EU emblem or any similar trademark or logo, either by registration or by any other means Disclaimer excluding Commission s and/or Agency s responsibility Any communication activity related to the specific actions must indicate that it reflects only the author's view and that the Commission and the Agency are not responsible for any use that may be made of the information it contains Communication activities by the Agency Right to use partners materials, documents or information The Agency may use, for its communication and publicising activities, information relating to the specific action, documents notably summaries for publication and public deliverables as well as any 23

24 Framework Partnership Agreement number: HCE other material, such as pictures or audio-visual material that it receives from any partner (including in electronic form). However, if the Agency s use of these materials, documents or information would risk compromising legitimate interests, the partner concerned may request the Agency not to use it (see Article 51). The right to use a partner s materials, documents and information includes: (a) use for its own purposes (in particular, making them available to persons working for the Agency or any other EU institution, agency or body, or institutions in EU Member States; and copying or reproducing them in whole or in part, in unlimited numbers); (b) distribution to the public (in particular, publication as hard copies and in electronic or digital format, publication on the internet, as a downloadable or non-downloadable file, broadcasting by any channel, public display or presentation, communicating through press information services, or inclusion in widely accessible databases or indexes); (c) editing or redrafting for communication and publicising activities (including shortening, summarising, inserting other elements (such as meta-data, legends, other graphic, visual, audio or text elements), extracting parts (e.g. audio or video files), dividing into parts, use in a compilation); (d) translation; (e) giving access in response to individual requests under Regulation No 1049/2001 6, without the right to reproduce or exploit; (f) storage in paper, electronic or other form; (g) archiving, in line with applicable document-management rules, and (h) the right to authorise third parties to act on its behalf or sub-license the modes of use set out in Points (b),(c),(d) and (f) to third parties, if needed for the communication and publicising activities of the Agency. If the right of use is subject to rights of a third party (including personnel of the partner), the partner must ensure that it complies with its obligations under the Framework Partnership Agreement and the Specific Agreements (in particular, by obtaining the necessary approval from the third parties concerned). Where applicable (and if provided by the partners), the Agency will insert the following information: [year] [name of the copyright owner]. All rights reserved. Licensed to the Executive Agency for Small and Medium-sized Enterprises (EASME) under conditions Consequences of non-compliance If a partner breaches any of its obligations under this Article, the specific grant may be reduced (see Article 42). 6 Regulation (EC) No 1049/2001 of the European Parliament and of the Council of 30 May 2001 regarding public access to European Parliament, Council and Commission documents, OJ L 145, , p

25 Framework Partnership Agreement number: HCE Such breaches may also lead to any of the other measures described in Section 5. ARTICLE 38 PROCESSING OF PERSONAL DATA 38.1 Processing of personal data by the Agency and the Commission Any personal data under the Framework Partnership Agreement and the Specific Agreements will be processed by the Agency or the Commission under Regulation No 45/ and according to the notifications of the processing operations to the Data Protection Officer (DPO) of the Agency or the Commission (publicly accessible in the DPO register). Such data will be processed by the data controller of the Agency or the Commission for the purposes of implementing, managing and monitoring of those agreements (including checks, reviews, audits and investigations; see Article 28). The persons whose personal data are processed have the right to access and correct their own personal data. For this purpose, they must send any queries about the processing of their personal data to the data controller, via the contact point indicated in the privacy statement on the Agency and Commission websites. They also have the right to have recourse at any time to the European Data Protection Supervisor (EDPS) Processing of personal data by the partners The partners must process personal data under the Framework Partnership Agreement and Specific Agreements in compliance with the applicable EU and national law on data protection (including authorisations or notification requirements). The partners may grant their personnel access only to data that is strictly necessary for implementing, managing and monitoring of those agreements. The partners must inform the personnel whose personal data are collected and processed by the Agency or the Commission. For this purpose, they must provide them with the privacy statement (see above), before transmitting their data to the Agency or the Commission Consequences of non-compliance If a partner breaches any of its obligations under Article 38.2, the Agency may apply any of the measures described in Section 5. ARTICLE 39 ASSIGNMENTS OF CLAIMS FOR PAYMENT AGAINST THE AGENCY The partners may not assign any of their claims for payment against the Agency to any third party, except if approved by the Agency on the basis of a reasoned, written request by the coordinator (on behalf of the partner concerned). 7 Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 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 (OJ L 8, , p. 1). 25

26 Framework Partnership Agreement number: HCE If the Agency has not accepted the assignment or the terms of it are not observed, the assignment will have no effect on it. In no circumstances will an assignment release the partners from their obligations towards the Agency. SECTION 4 DIVISION OF PARTNERS ROLES AND RESPONSIBILITIES ARTICLE 40 DIVISION OF PARTNERS ROLES AND RESPONSIBILITIES 40.1 Roles and responsibilities towards the Agency The partners have full responsibility for implementing the specific actions and complying with the Framework Partnership Agreement and the Specific Agreements. The partners are jointly and severally liable for the technical implementation of the specific actions as described in Annex 1 to the Specific Agreements. If a partner fails to implement its part of a specific action, the other partners become responsible for implementing this part (without being entitled to any additional EU funding for doing so), unless the Agency expressly relieves them of this obligation. The financial responsibility of each partner is governed by Articles 44 and 45 and Article 18 of the Specific Agreements Internal division of roles and responsibilities The internal roles and responsibilities of the partners are divided as follows: (a) Each partner must: (i) (ii) keep information stored in the 'Beneficiary Register' (via the electronic exchange system) up to date (see Article 23); inform the coordinator immediately of any events and circumstances likely to affect significantly or delay the implementation of a specific action (see Article 23); (iii) submit to the coordinator in good time: (b) The coordinator must: - an individual financial statements for itself and, if required, a certificate on the financial statement (see Article 14 EEN SGAs); - the data needed to draw up the progress reports and the technical report (see Articles 13 and 14 EEN SGAs); - any other documents or information required by the or the Agency Commission under the Framework Partnership Agreement or the Specific Agreements, unless those agreements require the partner to submit this information directly to the or the Agency Commission. (i) monitor that the action is implemented properly (see Article 12); 26

27 Framework Partnership Agreement number: HCE (ii) act as the intermediary for all communications between the partners and the Agency (in particular, providing the Agency with the information described in Article 23), unless the Framework Partnership Agreement or the Specific Agreements specify otherwise; (iii) provide a pre-financing guarantee if requested by the Agency (see Article 15.2 EEN SGA COSME) (iv) request and review any documents or information required by the Agency and verify their completeness and correctness before passing them on to the Agency; (v) submit the deliverables and reports to the Agency (see Articles 13 and 14 EEN SGAs); (vi) ensure that all payments are made to the other partners without unjustified delay (see Article 15 EEN SGAs); (vii) inform the Agency of the amounts paid to each partner, where required under the Specific Agreements (see Articles 18 and 19 EEN SGA H2020) or requested by the Agency. The coordinator may not delegate the above-mentioned tasks to any other partner or subcontract them to any third party Internal arrangements Consortium agreement The partners must have a consortium agreement with internal arrangements regarding their operation and co-ordination to ensure that the specific actions are implemented properly (see Article 4). SECTION 5 REJECTION OF COSTS REDUCTION OF THE GRANT RECOVERY PENALTIES DAMAGES SUSPENSION TERMINATION FORCE MAJEURE SUBSECTION 1 REJECTION OF COSTS REDUCTION OF THE GRANT RECOVERY PENALTIES ARTICLE 41 REJECTION OF INELIGIBLE COSTS 41.1 Conditions The Agency will at the payment of the balance or afterwards reject any costs for a specific action which are ineligible (see Article 5 EEN SGAs), in particular, following checks, reviews, audits or investigations (see Article 28) The rejection may also be based on the extension of findings from other grants to a specific grant, under the conditions set out in Article Ineligible costs to be rejected Calculation Procedure Ineligible costs will be rejected in full. 27

28 Framework Partnership Agreement number: HCE If the Agency rejects costs without reduction of the specific grant (see Article 42) or recovery of undue amounts (see Article 43), it will formally notify the coordinator or partner concerned the rejection of costs, the amounts and the reasons why (if applicable, together with the notification of amounts due; see Article 27). The coordinator or partner concerned may within 30 days of receiving notification formally notify the Agency of its disagreement and the reasons why. If the Agency rejects costs with reduction of the specific grant or recovery of undue amounts, it will formally notify the rejection in the pre-information letter on reduction or recovery set out in Articles 42 and Effects If the Agency rejects costs at the payment of the balance, it will deduct them from the total eligible costs declared, for the action, in the final summary financial statement (see Article 14 EEN SGAs). It will then calculate the payment of the balance (see Article 15 EEN SGAs). If the Agency rejects costs after the payment of the balance, it will deduct the amount rejected from the total eligible costs declared, by the partner, in the final summary financial statement. It will then calculate the revised final grant amount as set out in Article 4.4 of the Specific Agreements. ARTICLE 42 REDUCTION OF THE GRANT 42.1 Conditions The Agency may at the payment of the balance or afterward reduce the maximum grant amount (see Article 4 EEN SGAs), if a specific action has not been implemented properly as described in Annex 1 to the Specific Agreement concerned or another obligation under the Framework Partnership Agreement or that Specific Agreement has been breached The Agency may also reduce the maximum grant amount on the basis of the extension of findings from other grants to a specific grant, under the conditions set out in Article Amount to be reduced Calculation Procedure The amount of the reduction will be proportionate to the improper implementation of the specific action or to the seriousness of the breach. Before reduction of the specific grant, the Agency will formally notify a pre-information letter to the coordinator or partner concerned: - informing it of its intention to reduce the grant, the amount it intends to reduce and the reasons why and - inviting it to submit observations within 30 days of receiving notification. If the Agency does not receive any observations or decides to pursue reduction despite the observations it has received, it will formally notify confirmation of the reduction (if applicable, together with the notification of amounts due; see Article 15 EEN SGAs). 28

29 Framework Partnership Agreement number: HCE 42.3 Effects If the Agency reduces the specific grant at the time of the payment of the balance, it will calculate the reduced grant amount for the specific action and then determine the amount due as payment of the balance (see Article and Article 15 EEN SGAs). If the Agency reduces the specific grant after the payment of the balance, it will calculate the revised final grant amount for the partner concerned (see Article 4.4 EEN SGAs). If the revised final grant amount for the partner concerned is lower than its share of the final grant amount, the Agency will recover the difference (see Article 43). ARTICLE 43 RECOVERY OF UNDUE AMOUNTS The rules for the recovery of undue amounts are set out in the Specific Agreements (see Article 18 EEN SGAs). ARTICLE 44 ADMINISTRATIVE AND FINANCIAL PENALTIES 44.1 Conditions Under Articles 109 and 131(4) of the Financial Regulation No 966/2012, the Agency may impose administrative and financial penalties if a partner: (a) has committed substantial errors, irregularities or fraud or is in serious breach of its obligations under the Framework Partnership Agreement or a Specific Agreement or (b) has made false declarations about information required under those agreements or for the submission of a proposal (or has not supplied such information). Each partner is responsible for paying the financial penalties imposed on it. Under Article 109(3) of the Financial Regulation No 966/2012, the Agency or the Commission may under certain conditions and limits publish decisions imposing administrative or financial penalties Duration Amount of penalty Calculation Administrative penalties exclude the partner from all contracts and grants financed from the EU or Euratom budget for a maximum of five years from the date the infringement is established by the Agency. If the partner commits another infringement within five years of the date the first infringement is established, the Agency may extend the exclusion period up to 10 years. Financial penalties will be between 2% and 10% of the maximum EU contribution indicated, for the partner concerned, in the estimated budget (see Annex 2 EEN SGAs). If the partner commits another infringement within five years of the date the first infringement is established, the Agency may increase the rate of financial penalties to between 4% and 20% Procedure Before applying a penalty, the Agency will formally notify the partner concerned: 29

30 Framework Partnership Agreement number: HCE - informing it of its intention to impose a penalty, its duration or amount and the reasons why and - inviting it to submit observations within 30 days. If the Agency does not receive any observations or decides to impose the penalty despite of observations it has received, it will formally notify confirmation of the penalty to the partner concerned and in case of financial penalties deduct the penalty from the payment of the balance or formally notify a debit note, specifying the amount to be recovered, the terms and the date for payment. If payment is not made by the date specified in the debit note, the Agency or the Commission may recover the amount: (a) by offsetting it without the partner s consent against any amounts owed to the partner concerned by the Agency, the Commission or another executive agency (from the EU or Euratom budget). In exceptional circumstances, to safeguard the EU s financial interests, the Agency may offset before the payment date in the debit note; (b) by taking legal action (see Article 56) or by adopting an enforceable decision under Article 299 of the Treaty on the Functioning of the EU (TFEU) and Article 79(2) of the Financial Regulation No 966/2012. If payment is not made by the date in the debit note, the amount to be recovered (see above) will be increased by late-payment interest at the rate set out in Article 15 of the Specific Agreement, from the day following the payment date in the debit note, up to and including the date the Agency or the Commission receives full payment of the amount. Partial payments will be first credited against expenses, charges and late-payment interest and then against the principal. Bank charges incurred in the recovery process will be borne by the partner, unless Directive 2007/64/ EC applies. SUBSECTION 2 LIABILITY FOR DAMAGES ARTICLE 45 LIABILITY FOR DAMAGES 45.1 Liability of the Agency The Agency cannot be held liable for any damage caused to the partners or to third parties as a consequence of implementing the Framework Partnership Agreement or a Specific Agreement, including for gross negligence. The Agency cannot be held liable for any damage caused by any of the partners or third parties involved in the specific action, as a consequence of implementing the Framework Partnership Agreement or Specific Agreement. 30

31 Framework Partnership Agreement number: HCE 45.2 Liability of the partners Conditions Except in case of force majeure (see Article 50), the partners must compensate the Agency for any damage it sustains as a result of the implementation of a specific action or because a specific action was not implemented in full compliance with the Framework Partnership Agreement or a Specific Agreement. Each partner is responsible for paying the damages claimed from it Amount of damages - Calculation The amount the Agency can claim from a partner will correspond to the damage caused by that partner Procedure Before claiming damages, the Agency will formally notify the partner concerned: - informing it of its intention to claim damages, the amount and the reasons why and - inviting it to submit observations within 30 days. If the Agency does not receive any observations or decides to claim damages despite the observations it has received, it will formally notify confirmation of the claim for damages and a debit note, specifying the amount to be recovered, the terms and the date for payment. If payment is not made by the date specified in the debit note, the Agency or the Commission may recover the amount: (a) by offsetting it without the partner s consent against any amounts owed to the partner concerned by the Agency, the Commission or another executive agency (from the EU or Euratom budget). In exceptional circumstances, to safeguard the EU s financial interests, the Agency may offset before the payment date in the debit note; (b) by taking legal action (see Article 56) or by adopting an enforceable decision under Article 299 of the Treaty on the Functioning of the EU (TFEU) and Article 79(2) of the Financial Regulation No 966/2012. If payment is not made by the date in the debit note, the amount to be recovered (see above) will be increased by late-payment interest at the rate set out in Article 15 of the Specific Agreement, from the day following the payment date in the debit note, up to and including the date the Agency or the Commission receives full payment of the amount. Partial payments will be first credited against expenses, charges and late-payment interest and then against the principal. Bank charges incurred in the recovery process will be borne by the partner, unless Directive 2007/64/EC applies. 31

32 Framework Partnership Agreement number: HCE SUBSECTION 3 SUSPENSION AND TERMINATION ARTICLE 46 SUSPENSION OF PAYMENT DEADLINE 46.1 Conditions The Agency may at any moment suspend the payment deadline in a specific grant (see Article 15 EEN SGAs) if a request for payment (see Article 14 EEN SGAs) cannot be approved because: (a) it does not comply with the provisions of the Specific Agreement (see Article 14 EEN SGAs); (b) the technical report or financial reports have not been submitted or is not complete or additional information is needed, or (c) there is doubt about the eligibility of the costs declared in the financial statements and additional checks, reviews, audits or investigations are necessary Procedure The Agency will formally notify the coordinator of the suspension and the reasons why. The suspension will take effect the day notification is sent by the Agency (see Article 51). If the conditions for suspending the payment deadline are no longer met, the suspension will be lifted and the remaining period will resume. If the suspension exceeds two months, the coordinator may request the Agency if the suspension will continue. If the payment deadline has been suspended due to the non-compliance of the technical or financial report (see Article 14 EEN SGAs) and the revised report or statement is not submitted or was submitted but is also rejected, the Agency may also terminate the Specific Agreement concerned or the participation of the partner (see Article (j)). ARTICLE 47 SUSPENSION OF PAYMENTS 47.1 Conditions The Agency may at any moment suspend for a specific grant, in whole or in part, the prefinancing payment for one or more partners or the payment of the balance for all partners, if a partner: a) has committed or is suspected of having committed substantial errors, irregularities, fraud or serious breach of obligations in the award procedure or under the Framework Agreement or a Specific Agreement or b) has committed in other EU or Euratom grants awarded to it under similar conditions systemic or recurrent errors, irregularities, fraud or serious breach of obligations that have a material impact on the specific grant (extension of findings from other grants to the specific grant; see Article ). 32

33 Framework Partnership Agreement number: HCE 47.2 Procedure Before suspending payments, the Agency will formally notify the coordinator: - informing it of its intention to suspend payments and the reasons why and - inviting it to submit observations within 30 days of receiving notification. If the Agency does not receive observations or decides to pursue the procedure despite the observations it has received, it will formally notify confirmation of the suspension. Otherwise, it will formally notify that the suspension procedure is not continued. The suspension will take effect the day the confirmation notification is sent by the Agency. If the conditions for resuming payments are met, the suspension will be lifted. The Agency will formally notify the coordinator. The partners may suspend implementation of the action (see Article 48.1) or terminate the Specific Agreement concerned or the participation of the partner concerned (see Article 49.1 and 49.2). ARTICLE 48 SUSPENSION OF THE ACTION IMPLEMENTATION 48.1 Suspension of the action implementation, by the partners Conditions The partners may suspend implementation of a specific action or any part of it, if exceptional circumstances in particular force majeure (see Article 50) make implementation impossible or excessively difficult Procedure The coordinator must immediately formally notify to the Agency of the suspension (see Article 51), stating: - the reasons why and - the expected date of resumption. The suspension will take effect the day this notification is received by the Agency. Once circumstances allow for implementation to resume, the coordinator must immediately formally notify the Agency and request an amendment of the Specific Agreement concerned to set the date on which the specific action will be resumed, extend the duration of the specific action and make other changes necessary to adapt the specific action to the new situation (see Article 54) unless the Specific Agreement or the participation of a partner has been terminated (see Article 49). The suspension will be lifted with effect from the resumption date set out in the amendment. This date may be before the date on which the amendment enters into force. Costs incurred during suspension of the action implementation are not eligible (see Article 5 EEN SGAs). 33

34 Framework Partnership Agreement number: HCE 48.2 Suspension of the action implementation, by the Agency Conditions The Agency may suspend implementation of a specific action or any part of it: (a) if a partner has committed or is suspected of having committed substantial errors, irregularities, fraud or serious breach of obligations in the award procedure or under the Framework Partnership Agreement or a Specific Agreement or (b) if a partner has committed in other EU or Euratom grants awarded to it under similar conditions systemic or recurrent errors, irregularities, fraud or serious breach of obligations that have a material impact on the specific grant (extension of findings from other grants to the specific grant; see Article ) Procedure Before suspending implementation of the specific action, the Agency will formally notify the coordinator: - informing it of its intention to suspend the implementation and the reasons why and - inviting it to submit observations within 30 days of receiving notification. If the Agency does not receive observations or decides to pursue the procedure despite the observations it has received, it will formally notify confirmation of the suspension. Otherwise, it will formally notify that the procedure is not continued. The suspension will take effect five days after the confirmation notification is received by the coordinator (or on a later date specified in the notification). It will be lifted if the conditions for resuming implementation of the action are met. The coordinator will be formally notified of the lifting and the Specific Agreement concerned will be amended to set the date on which the specific action will be resumed, extend the duration of the specific action and make other changes necessary to adapt the specific action to the new situation (see Article 54) unless the Agreement has already been terminated (see Article 49). The suspension will be lifted with effect from the resumption date set out in the amendment. This date may be before the date on which the amendment enters into force. Costs incurred during suspension are not eligible (see Article 5 EEN SGAs). The partners may not claim damages due to suspension by the Agency (see Article 45). Suspension of the action implementation does not affect the Agency's right to terminate the Agreement or participation of a partner (see Article 49), reduce the grant or recover amounts unduly paid (see Articles 42 and 43). 34

35 Framework Partnership Agreement number: HCE ARTICLE 49 TERMINATION OF THE SPECIFIC AGREEMENT OR OF THE PARTICIPATION OF ONE OR MORE PARTNERS 49.1 Termination of the Specific Agreement, by the partners Conditions and procedure The partners may terminate a Specific Agreement. The coordinator must formally notify termination to the Agency (see Article 51), stating: - the reasons why and - the date the termination will take effect. This date must be after the notification. If no reasons are given or if the Agency the Specific Agreement concerned will be considered to have been terminated improperly. The termination will take effect on the day specified in the notification Effects The coordinator must within 60 days from when termination takes effect submit the final report (see Article 14 EEN SGAs). If the Agency does not receive the reports within the deadline (see above), no costs will be taken into account. The Agency will calculate the final grant amount and the balance (see Articles 4.3 and 15 EEN SGAs) on the basis of the report submitted. Only costs incurred until termination are eligible. Costs relating to contracts due for execution only after termination are not eligible. Improper termination may lead to a reduction of the grant (see Article 42). After termination, the partners obligations (in particular Articles 26, 28, 29, Subsection 3 of Section 3 of Chapter 3, 35, 37, 39) continue to apply Termination of the participation of one or more partners, by the partners Conditions and procedure The participation of one or more partners in a specific action may be terminated by the coordinator, on request of the partner concerned or on behalf of the other partners. The coordinator must formally notify termination to the Agency (see Article 51) and inform the partner concerned. If the coordinator s participation is terminated without its agreement, the formal notification must be done by another partner (acting on behalf of all the other partners). The notification must include: 35

36 Framework Partnership Agreement number: HCE - the reasons why; - the opinion of the partner concerned (or proof that this opinion has been requested in writing); - the date the termination takes effect. This date must be after the notification; - a request for amendment (see Article 54), with a proposal for reallocation of the tasks and the estimated budget of the partner concerned (see Annexes 1 and 2 EEN SGAs) and, if necessary, the addition of one or more new partners (see Article 55). If termination takes effect after the period set out in Article 3 of the Specific Agreements, no request for amendment must be included unless the partner concerned is the coordinator. In this case, the request for amendment must propose a new coordinator. If this information is not given or if the Agency considers that the reasons do not justify termination, the participation will be considered to have been terminated improperly. The termination will take effect on the day specified in the notification Effects The effects of termination of the participation of one or more partners (by the partners) are set out in the Specific Agreements (see Article 19 EEN SGAs) Termination of the Specific Agreement or the participation of one or more partners, by the Agency Conditions The Agency may terminate a Specific Agreement or the participation of one or more partners in a specific action, if: (a) one or more partner do not accede to the Framework Partnership Agreement; (b) a change to their legal, financial, technical, organisational or ownership situation is likely to substantially affect or delay the implementation of the specific action or calls into question the decision to award the specific grant; (c) following termination of participation for one or more partners (see above), the necessary changes to the Specific Agreement would call into question the decision awarding the specific grant or breach the principle of equal treatment of applicants (see Article 54); (d) implementation of the specific action is prevented by force majeure (see Article 50) or suspended by the coordinator (see Article 48.1) and either: (i) (ii) resumption is impossible, or the necessary changes to the Specific Agreement would call into question the decision awarding the specific grant or breach the principle of equal treatment of applicants; (e) a partner is declared bankrupt, being wound up, having its affairs administered by the courts, has entered into an arrangement with creditors, has suspended business activities, or is subject to any other similar proceedings or procedures under national law; 36

37 Framework Partnership Agreement number: HCE (f) a partner (or a natural person who has the power to represent or take decisions on its behalf) has been found guilty of professional misconduct, proven by any means; (g) a partner does not comply with the applicable national law on taxes and social security; (h) a partner (or a natural person who has the power to represent or take decisions on its behalf) has committed fraud, corruption, or is involved in a criminal organisation, money laundering or any other illegal activity affecting the EU s financial interests; (i) a partner (or a natural person who has the power to represent or take decisions on its behalf) has in the award procedure or under the Framework Partnership Agreement or the Specific Agreement committed: (i) (ii) substantial errors, irregularities, fraud; serious breach of obligations, including improper implementation of the specific action or breach of ethical principles, or (iii) submission of false information or failure to provide required information; (j) a partner has committed in other EU or Euratom grants awarded to it under similar conditions systemic or recurrent errors, irregularities, fraud or serious breach of obligations that have a material impact on the specific grant ( extension of findings from other grants to the specific grant ) Procedure Before terminating the Specific Agreement or participation of one or more partners, the Agency will formally notify the coordinator: - informing it of its intention to terminate and the reasons why and - inviting it, within 30 days of receiving notification, to submit observations and in case of Point (i.ii) and (i.iii) above to inform the Agency of the measures to ensure compliance with the obligations under the Framework Partnership Agreement and the Specific Agreement concerned. If the Agency does not receive observations or decides to pursue the procedure despite the observations it has received, it will formally notify to the coordinator confirmation of the termination and the date it will take effect. Otherwise, it will formally notify that the procedure is not continued. The termination will take effect: - for terminations under Points (b), (c), (e), (g), (i.ii) and (i.iii) above: on the day specified in the notification of the confirmation (see above); - for terminations under Points (a), (d), (f), (h), (i.i) and (j) above: on the day after the notification of the confirmation is received by the coordinator Effects The effects of termination of the Agreement (by the Agency) are as follows: 37

38 Framework Partnership Agreement number: HCE - The coordinator must within 60 days from when termination takes effect submit a final report (see Article 14 EEN SGAs). - If the Specific Agreement is terminated for breach of the obligation to submit the report (see Article (i) EEN FPA and Article 14 EEN SGAs), the coordinator may not submit any report after termination. - If the Agency does not receive the report within the deadline (see above), no costs will be taken into account. - The Agency will calculate the final grant amount and the balance (see Articles 4.2 and 15 EEN SGAs) on the basis of the report submitted. Only costs incurred until termination takes effect are eligible (see Article 5 EEN SGAs). Costs relating to contracts due for execution only after termination are not eligible. - This does not affect the Agency s right to reduce the specific grant (see Article 42) or to impose administrative and financial penalties (Article 44). - The partners may not claim damages due to termination by the Agency (see Article 45). - After termination, the partners obligations (in particular Articles 26, 28, 29, Subsection 3 of Section 3 of Chapter 3, 35, 37, 39) continue to apply. The effects of termination of the participation of one or more partners (by the Agency) are set out in the Specific Agreements (see Article 19 EEN SGAs). SUBSECTION 4 FORCE MAJEURE ARTICLE 50 FORCE MAJEURE Force majeure means any situation or event that: - prevents either party from fulfilling their obligations under the Agreement, - was unforeseeable, exceptional situation and beyond the parties control, - was not due to error or negligence on their part (or on the part of third parties involved in the action), and - proves to be inevitable in spite of exercising all due diligence. The following cannot be invoked as force majeure: - any default of a service, defect in equipment or material or delays in making them available, unless they stem directly from a relevant case of force majeure, - labour disputes or strikes, or - financial difficulties. Any situation constituting force majeure must be formally notified to the other party without delay, stating the nature, likely duration and foreseeable effects. 38

39 Framework Partnership Agreement number: HCE The parties must immediately take all the necessary steps to limit any damage due to force majeure and do their best to resume implementation of the action as soon as possible. The party prevented by force majeure from fulfilling its obligations under the Framework Partnership Agreement or a Specific Agreement cannot be considered in breach of them. CHAPTER 4 FINAL PROVISIONS ARTICLE 51 COMMUNICATIONS BETWEEN THE PARTIES 51.1 Form and means of communications Communication under the Framework Partnership Agreement and the Specific Agreements (information, requests, submissions, formal notifications, etc.) must: - be made in writing and - bear the number of the Framework Partnership Agreement and the Specific Agreement concerned. Until the payment of the balance: all communication must be made through the electronic exchange system and using the forms and templates provided there. After the payment of the balance: formal notifications must be made by registered post with proof of delivery ( formal notification on paper ). Communications in the electronic exchange system must be made by persons authorised according to the Terms and Conditions of Use of the electronic exchange system. For naming the authorised persons, each partner must have designated before the signature of the Framework Partnership Agreement a Legal Entity Appointed Representative (LEAR). The role and tasks of the LEAR are stipulated in his/her appointment letter (see Terms and Conditions of Use of the electronic exchange system). If the electronic exchange system is temporarily unavailable, instructions will be given on the Agency and Commission websites Date of communications Communications are considered to have been made when they are sent by the sending party (i.e. on the date and time they are sent through the electronic exchange system). Formal notifications through the electronic exchange system are considered to have been made when they are received by the receiving party (i.e. on the date and time of acceptance by the receiving party, as indicated by the time stamp). A formal notification that has not been accepted within 10 days after sending is considered to have been accepted. Formal notifications on paper sent by registered post with proof of delivery (only after the payment of the balance) are considered to have been made on either: - the delivery date registered by the postal service or 39

40 Framework Partnership Agreement number: HCE - the deadline for collection at the post office. If the electronic exchange system is temporarily unavailable, the sending party cannot be considered in breach of its obligation to send a communication within a specified deadline Addresses for communication The electronic exchange system must be accessed via the following URL: The Agency will formally notify the coordinator and partners in advance any changes to this URL. Formal notifications on paper (only after the payment of the balance) addressed to the Agency must be sent to the following address: Executive Agency for Small and Medium-sized Enterprises (EASME) OPERATIONS COSME Place Rogier 16 B-1049 Brussels Belgium Formal notifications on paper (only after the payment of the balance) addressed to the partners must be sent to their legal address as specified in the Beneficiary Register (in the electronic exchange system). ARTICLE 52 INTERPRETATION OF THE FRAMEWORK PARTNERSHIP AGREEMENT AND THE SPECIFIC AGREEMENTS 52.1 Precedence of the Terms and Conditions over the Annexes The provisions in the Terms and Conditions of the Framework Partnership Agreement and the Specific Agreements take precedence over their Annexes. Annex 2 to the Specific Agreement takes precedence over its Annex Precedence of the Terms and Conditions of the Specific Agreements over the Framework Partnership Agreement The provisions in the Terms and Conditions of the Specific Agreements take precedence over the Framework Partnership Agreement Privileges and immunities Not applicable 40

41 Framework Partnership Agreement number: HCE ARTICLE 53 CALCULATION OF PERIODS, DATES AND DEADLINES In accordance with Regulation No 1182/71 8, periods expressed in days, months or years are calculated from the moment the triggering event occurs. The day during which that event occurs is not considered as falling within the period. ARTICLE 54 AMENDMENTS TO THE FRAMEWORK PARTNERSHIP AGREEMENT AND THE SPECIFIC AGREEMENTS 54.1 Conditions The Framework Partnership Agreement and the Specific Agreements may be amended, unless the amendment entails changes to those agreements which would call into question the decisions awarding the framework partnership or specific grants concerned or breach the principle of equal treatment of applicants. Amendments to the Framework Partnership Agreement cannot extend the duration of the framework partnership (see Article 3). Amendments may be requested by any of the parties Procedure The party requesting an amendment must submit a request for amendment signed in the electronic exchange system (see Article 51). The coordinator submits and receives requests for amendment on behalf of the partners (see Annex 3). If a change of coordinator is requested without its agreement, the submission must be done by another partner (acting on behalf of the other partners). The request for amendment must include: - the reasons why; - the appropriate supporting documents; - for a change of coordinator without its agreement: the opinion of the coordinator (or proof that this opinion has been requested in writing). The Agency may request additional information. If the party receiving the request agrees, it must sign the amendment in the electronic exchange system within 45 days of receiving notification (or any additional information the Agency has requested). If it does not agree, it must formally notify its disagreement within the same deadline. The deadline may be extended, if necessary for the assessment of the request. If no notification is received within the deadline, the request is considered to have been rejected. 8 Regulation (EEC, Euratom) No 1182/71 of the Council of 3 June 1971 determining the rules applicable to periods, dates and time-limits (OJ L 124, , p. 1). 41

42 Framework Partnership Agreement number: HCE An amendment enters into force on the day of the signature of the receiving party. An amendment takes effect on the date agreed by the parties or, in the absence of such an agreement, on the date on which the amendment enters into force. ARTICLE 55 ACCESSION TO THE FRAMEWORK PARTNERSHIP AGREEMENT AND THE SPECIFIC AGREEMENTS 55.1 Accession of the partners mentioned in the preamble The other partners must accede to the Framework Partnership Agreement by signing the Accession Form (see Annex 3) in the electronic exchange system (see Article 51) within 30 days after its entry into force (see Article 57). All partners having acceded to the Framework Partnership Agreement must be part of the Specific Agreements. The partners will accede to the Specific Agreements by signature of the coordinator (see mandate in Annex 3). They will assume the rights and obligations under the agreements with effect from the date of their entry into force (see Article 57 and Article 20 EEN SGAs). If a partner does not accede to the Framework Partnership Agreement within the above deadline, the coordinator must within 30 days request an amendment to make any changes necessary to ensure proper implementation of the implementation strategy. This does not affect the Agency s right to terminate the agreements (see Articles 6 and 49) Addition of new partners In justified cases, the partners may request the addition of a new partner. For this purpose, the coordinator must submit a request for amendment of the Framework Partnership and the Specific Agreements in accordance with Article 54. It must include an Accession Form (see Annex 3) signed by the new partner in the electronic exchange system (see Article 51). New partners must assume the rights and obligations under the agreements with effect from the date of their accession specified in the Accession Form (see Annex 3). ARTICLE 56 APPLICABLE LAW AND SETTLEMENT OF DISPUTES 56.1 Applicable law The Agreement and the Specific Agreements are governed by the applicable EU law, supplemented if necessary by the law of Belgium Dispute settlement If a dispute concerning the interpretation, application or validity of the Framework Partnership Agreement or a Specific Agreement cannot be settled amicably, the General Court or, on appeal, the Court of Justice of the European Union has sole jurisdiction. Such actions must be brought under Article 272 of the Treaty on the Functioning of the EU (TFEU). 42

43 Framework Partnership Agreement number: HCE As an exception, for partners not receiving EU funding under a Specific Agreement, such disputes must if they cannot be settled amicably be referred to arbitration. The Permanent Court of Arbitration Optional Rules for Arbitration Involving International Organisations and States in force at the date of entry into force of the Agreement will apply. The appointing authority will be the Secretary-General of the Permanent Court of Arbitration following a written request submitted by either party. The arbitration proceedings must take place in Brussels and the language used in the arbitral proceedings will be English. The arbitral award will be binding on all parties and will not be subject to appeal. If a dispute concerns administrative or financial penalties, offsetting or an enforceable decision under Article 299 TFEU (see Articles 43, 44 and 45), the partners must bring action before the General Court or, on appeal, the Court of Justice of the European Union under Article 263 TFEU. Actions against enforceable decisions must be brought against the Commission (not against the Agency). ARTICLE 57 ENTRY INTO FORCE OF THE FRAMEWORK PARTNERSHIP AGREEMENT The Framework Partnership Agreement will enter into force on the day of signature by the Agency or the coordinator, depending on which is later. SIGNATURES For the coordinator For the Agency [--TGSMark#signature _75_210--] [--TGSMark#signature-service_75_210--] 43

44 EUROPEAN COMMISSION Executive Agency for Small and Medium-sized Enterprises (EASME) COSME ANNEX 1 (part A) Framework Partnership Agreement NUMBER HCE

45 Table of Contents 1.1. The project summary The list of beneficiaries Ethics Requirements (set by Commission/Agency)...5

46 1.1. The project summary Project Number Project Acronym 2 HCE One form per project Project title 3 General information Providing integrated Enterprise Europe Network services for in Hungary with a national coverage Starting date 4 Duration in months 5 72 Call (part) identifier 6 Topic COS-EEN COSME Implementation of the Enterprise Europe Network Fixed EC Keywords Free keywords SME, business development services, market access, cross-border partnering, internationalization, innovation, access to finance and funds, EU funded R+D projects, IPR, green entrepreneurship, Abstract 7 Proposal for providing Enterprise Europe Network services in Hungary for the period. The proposal elaborates the strategy, means and tools of services provided with a national coverage by 9 partners to foster economic growth and international competitiveness in SMEs. Implementation of an integrated, high quality service delivery concept based on the experience and good practices obtained in the previous project period. Consortium partners aim at providing relevant, added-value business and innovation services with an EU dimension under the project scope in order to aid SMEs in their activities related to internationalization and innovation, and help them develop the required capacities and utilize a large highly qualified expert pool. In order to facilitate access for SMEs to the international markets and foster the development of internationally competitive and innovative companies consortium partners shall provide the following services in the context of the Enterprise Europe Network project: providing access to information on the internal market, EU legislation, and other EU subjects relevant to SMEs and advice and support services for internationalisation, innovation, technology transfer and participation in EU funded R&D programmes cross-border partnering services for business cooperation, technology transfer, innovation and research participation in SME feedback activities specific activities under Horizon 2020 enhancing the innovation management capacities of SMEs The main client base of the Network in Hungary shall be SMEs that have the potential and motivation to grow, extend their activities to the international market and find business partners abroad. Such target companies act like a catalyst in relation to other SMEs in their region, therefore the positive impact of the relevant services provided to them will be multiplied. Page 3 of 5

47 1.2. List of Beneficiaries Project Number Project Acronym 2 HCE List of Beneficiaries No Name Short name Country Project entry month 8 Project exit month IG RG Member Member 1 Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag HTD Hungary 1 72 No No ATEKNEA SOLUTIONS HUNGARY KFT FEJER MEGYEI KERESKEDELMI ES IPARKAMARA GYOR-MOSON-SOPRON MEGYEI KERESKEDELMI ES IPARKAMARA ZALA MEGYEI VALLALKOZASFEJLESZTESI ALAPITVANY PECS-BARANYAI KERESKEDELMI ES IPARKAMARA HAJDU-BIHAR MEGYEI KERESKEDELMI ES IPARKAMARA PRIMOM FOUNDATION FOR ENTERPRISE PROMOTION OF SZABOLCS SZATMAR BEREG COUNTY BT CSONGRAD MEGYEI KERESKEDELMI ES IPARKAMARA ATEKNEA Hungary 1 72 No No FMKIK Hungary 1 72 No No Győr-Moson- Sopron Megyei Kereskedelmi és Iparkamara Hungary 1 72 No No ZMVA Hungary 1 72 No No PECS- BARANYAI KERESKEDELMI Hungary 1 72 No No ES IPARKAMARA HAJDU- BIHAR MEGYEI Hungary KERESKEDELMI 1 72 No No ES IPARKAMARA PRIMOM SZABOLCS- SZATMAR- BEREG MEGYEI Hungary 1 72 No No VALLALKOZASELENKITO ALAPITVANY CSMKIK Hungary 1 72 No No Page 4 of 5

48 1.3. Ethics Requirements No ethics requirements indicated Page 5 of 5

49 1. Project number The project number has been assigned by the Commission as the unique identifier for your project. It cannot be changed. The project number should appear on each page of the grant agreement preparation documents (part A and part B) to prevent errors during its handling. 2. Project acronym Use the project acronym as given in the submitted proposal. It can generally not be changed. The same acronym should appear on each page of the grant agreement preparation documents (part A and part B) to prevent errors during its handling. 3. Project title Use the title (preferably no longer than 200 characters) as indicated in the submitted proposal. Minor corrections are possible if agreed during the preparation of the grant agreement. 4. Starting date Unless a specific (fixed) starting date is duly justified and agreed upon during the preparation of the Grant Agreement, the project will start on the first day of the month following the entry into force of the Grant Agreement (NB : entry into force = signature by the Commission). Please note that if a fixed starting date is used, you will be required to provide a written justification. 5. Duration Insert the duration of the project in full months. 6. Call (part) identifier The Call (part) identifier is the reference number given in the call or part of the call you were addressing, as indicated in the publication of the call in the Official Journal of the European Union. You have to use the identifier given by the Commission in the letter inviting to prepare the grant agreement. 7. Abstract 8. Project Entry Month The month at which the participant joined the consortium, month 1 marking the start date of the project, and all other start dates being relative to this start date. 9. Work Package number Work package number: WP1, WP2, WP3,..., WPn 10. Lead beneficiary This must be one of the beneficiaries in the grant (not a third party) - Number of the beneficiary leading the work in this work package 11. Person-months per work package The total number of person-months allocated to each work package. 12. Start month Relative start date for the work in the specific work packages, month 1 marking the start date of the project, and all other start dates being relative to this start date. 13. End month Relative end date, month 1 marking the start date of the project, and all end dates being relative to this start date. 14. Deliverable number Deliverable numbers: D1 - Dn 15. Type Please indicate the type of the deliverable using one of the following codes: R Document, report DEM Demonstrator, pilot, prototype DEC Websites, patent fillings, videos, etc. OTHER 16. Dissemination level Please indicate the dissemination level using one of the following codes: PU Public

50 CO Confidential, only for members of the consortium (including the Commission Services) CI Classified, as referred to in Commission Decision 2001/844/EC 17. Delivery date for Deliverable Month in which the deliverables will be available, month 1 marking the start date of the project, and all delivery dates being relative to this start date. 18. Milestone number Milestone number:ms1, MS2,..., MSn 19. Review number Review number: RV1, RV2,..., RVn 20. Installation Number Number progressively the installations of a same infrastructure. An installation is a part of an infrastructure that could be used independently from the rest. 21. Installation country Code of the country where the installation is located or IO if the access provider (the beneficiary or linked third party) is an international organization, an ERIC or a similar legal entity. 22. Type of access VA if virtual access, TA-uc if trans-national access with access costs declared on the basis of unit cost, TA-ac if trans-national access with access costs declared as actual costs, and TA-cb if trans-national access with access costs declared as a combination of actual costs and costs on the basis of unit cost. 23. Access costs Cost of the access provided under the project. For virtual access fill only the second column. For trans-national access fill one of the two columns or both according to the way access costs are declared. Trans-national access costs on the basis of unit cost will result from the unit cost by the quantity of access to be provided.

51 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE PART B History of changes 1. Minor changes and adjustments have been implemented throughout the Implementation Strategy necessitated by the change in coordinator organization as previously negotiated with the EASME. The change in coordinator organization was induced by the decision of the Hungarian Government which transferred all trade development and export promotion activities to the Hungarian Trade Development Llc operating under the umbrella of the Hungarian National Trading House. 2. Additional paragraph inserted at the end of Section 2 to provide further reasoning and justification for the scope and level of activity planned and the required level of resources. This additional wording reflects to the question raised by the evaluator in Criterion 5 Resource Effectiveness of the ESR. (p7) 3. As an answer to the comment by the evaluator in the Overall Comments Section of the ESR additional paragraph inserted at the end of Section 4 further elaborating the separation of for-profit activities and Network related non-profit activities of partner ATEKNEA. (p12-13) 4. At the end of paragraph 10 of Section 9 additional wording has been inserted to explain in detail how the consortium intends to benchmark its performance as this question was raised by the evaluator in Criterion 2 QUALITY of the ESR. (p31) Table of Contents Cover page Geographical coverage Needs of the companies in the proposed geographical coverage Objectives Organisational and staff competences Consortium Organisation Communication strategy Cooperation with local, regional and national stakeholders and with organisations located third countries covered by the Network Methodology and justification for the proposed strategy Quality principles, internal implementation and control Page 1 of 32

52 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Implementation Strategy (proposal Annex 1.A) ANNEX 1.A IMPLEMENTATION STRATEGY COSME Call for proposals COS-WP Project acronym: Proposal reference number in SEP: HCE SEP Project action duration: FPA 6 years, Start date: 1 January 2015 Coordinating organisation: Hungarian Trade Development Llc (HTD) Number of partners: 9 Region(s) covered (if applicable indicate NUTS number): HUNGARY national coverage, all NUTS2 regions: HU10-Central Hungary HU21-Central Transdanubia HU22-WesternTransdanubia HU23-Southern Transdanubia HU31-Northern Hungary HU32-Northern Great Plain HU33-Southern Great Plain Structure All pages should be numbered. Each page should be headed with the project acronym and drafting date. The document should not exceed 30 pages. The implementation strategy covers a period of six years and shall be based on a thorough analysis of the needs of the SMEs and of existing services and service gaps in the proposed geographical area. It will constitute Annex I to the Framework Partnership Agreement (FPA), which will provide the frame for any specific grant agreements signed during the period from 2015 to Page 2 of 32

53 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Geographical coverage (max. 2 pages) Geographical area proposed, economic issues and SME policies. Partners provide Network services in a consortium that covers the whole of Hungary, applying the principle of No Wrong Door countrywide. This national coverage ensures that enterprises receive the same, high quality services indifferent to where they are based in the country. Being a small and highly open economy, the Hungarian economy is considerably influenced by its wider economic environment, i.e. economic situation in the European Union, its main trading partner. The global financial crisis had also reached Hungary in October 2008, and production drastically slowed down in Though some improvement is forecasted for 2014 after stagnation in 2013, the crisis is far from being over and this fact has a decisive impact on the room for manoeuvre and growth prospects of Hungarian SMEs. In Hungary the share of SMEs in the total number of enterprises exceeds the EU average. Based on 2012 data published by the Hungarian Central Statistical Office, SMEs accounted for 99.9 percent of the active businesses ( ) in Hungary, and produced 53.8 percent of added value. Micro enterprises also represent a significant share; about 95 percent of SMEs are considered micro enterprises. SMEs play a prominent role in employment, since they employ 62.9 percent of employees. The number of people employed by an average Hungarian SME (3.1 employees) is typically lower than the EU average (4.2 employees), but their influence on employment is still significant due to the large number of SMEs. The number of SMEs that are active in the field of internationalization and are suitable for growth due to some form of innovation is low, that s on of the key reasons why this sector was particularly adversely affected by the financial and economic crisis that hit Hungary in The macroeconomic environment was especially unfavourable for businesses in recent years. During 2012, global economic growth moderated and turned negative, and we saw only a slight improvement in In Hungary, external demand declined sharply in recent years, while internal consumption also weakened. The competitiveness and internationalization though this process accelerated in recent years of Hungarian SMEs lag behind EU average. The indicators of competitiveness are directly proportional to the size of the company; larger companies are more capital intensive, their employees and managers are better qualified, they spend more on research and development, are more innovative and have better chances to have access to external sources of funding. The crisis has further widened the gap between the enterprises of various sizes. The Hungarian SME sector is highly diversified in terms of development level, ability to enter foreign markets and export maturity. There are few companies among them that have significant growth potential and produce high added value (particularly in the biotechnology and info-communication industries). These companies are naturally present in foreign markets ever since their establishment and geographical vicinity is not an issue (born global). There are other enterprises that adopted a traditional approach of gradualism to internationalization, and first open to well-known neighbouring markets, going for expansion from that base. There is a larger number of inexperienced companies that are beginners in exporting or future exporters, while the majority of SMEs are forced entrepreneurs, mainly operating as micro enterprises that cannot be engaged in export activities at the current level of their development due to the lack of capital, knowledge and a competitive product base. Almost two third of the added value produced by SMEs is generated by four large sectors in Hungary: wholesale and retail trade, manufacturing, services and the construction industry. Four fifth of the Hungarian SMEs operates in the services sector, while their role is typically less significant in the manufacturing industries than in other member states. Hungary has considerable comparative advantages in the knowledge- and technology-intensive strategic industries producing significant added values, such as ICT, biotechnology, pharmaceutical industry, health, environment, automotive industry and renewable energy, and the share of these sectors is just slightly lower than the EU average. A key sector is ICT, generating 10 percent of the GDP, where SMEs even proved more resistant to the effects of the crisis and managed to increase the added value generated by them. The majority of dynamically growing, innovative gazelle companies operate in this sector. Though Hungary is a very open, export oriented economy, and the export of goods represents over 60 percent of the GDP, the share of SMEs in the export of goods is still low. The share of SMEs in the total export volume was 23 percent in 2012, and while this represents some growth over previous years, it is still considered very low. A 2010 EU survey revealed that 25 percent of SMEs in the EU-27 exported at least once in the 3-year period preceding the survey. Hungarian average was lower than that, only 18 percent. Most of the import is concentrated in some key industries, such as the manufacturing of machinery and equipment; vehicle manufacturing, chemical industry; textile industry, and typically the larger medium enterprises take part in it. According to the Innovation Union Scoreboard 2014, Hungary is a moderate innovator. The country s Page 3 of 32

54 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE innovation performance, despite some fluctuations, improved between 2006 and The performance relative to the EU increased to 63% in 2013 from around 60% in Hungary performs below the EU average for most indicators, especially for non-eu doctorate students and Community designs. Relative strengths are observed in license and patent revenues from abroad, international scientific co-publications and fastgrowing innovative firms. High growth is observed for Community trademarks, R&D expenditures in the business sector and sales share of new innovations. A large decline in growth is observed for non-r&d innovation expenditures. Other notable declines are in R&D expenditures in the public sector, SMEs innovating in-house and Community designs. GDP proportional R&D expenditures grew slowly but steadily between 2008 and 2012, amounting to 1.3 percent in Per capita R&D expenditures grew even faster; its value was 38 percent higher in 2012 than in As regards R&D spending, the corporate sector grew in importance between 2008 and 2012, and two thirds of total expenditures were corporate spending in The 2013 Small Business Act (SBA) profile of Hungary has improved since the last edition. There are some areas where our performance has improved from the former below-average level to reach the EU average, such as the entrepreneurship, public procurement and state aid categories. Currently there are six categories in the SBA profile where Hungary is below the EU-average, and in further four areas Hungary s performance is on par with EU-average. Areas where we still need to improve are Second Chance, Think small first, Access to finance, Skills & Innovation, Environment and Internationalisation. The services provided by the Hungarian consortium within the Enterprise Europe Network can effectively contribute to the improvement of the indicators in some of the above areas, in particular Access to finance, Skills & Innovation and Internationalisation. In recent years Hungary, in line with the 10 SBA policy dimensions, has introduced various measures to support SMEs that found themselves in difficult situation due to the crisis, and to stimulate their growth. The main areas of these measures are facilitating access to financing, reducing the administrative burdens, and lowering taxes and contributions, as well as promoting the internationalization of SMEs. A main objective of the Government s comprehensive Foreign Trade Strategy is to encourage and facilitate SMEs successful entrance to, and expansion on foreign markets. A principal instrument of the implementation of the Foreign Trade Strategy is the Hungarian National Trading House under which the Network coordinator Hungarian Trade Development Llc operates, and a further key player is the Hungarian Chamber of Commerce and Industry, of which five regional members are Network partners. The National Research, Development and Innovation Strategy was adopted in 2013 with a primary aim of developing the innovation abilities of Hungarian SMEs and increasing their R&D&I activities. The Innovation Strategy refers to the Hungarian Network, mentioning that its activity shall be channelled into the strategy. In the planning cycle the objective of the comprehensive national development strategy is economic growth built on sustainable production that generates high added value and on the increase of employment, and the development of the SME sector will play a key role in this strategy. Having regard to the fact that the Hungarian Enterprise Europe Network and the hosts comprising it actively participated in the preliminary consultation on these strategies, the activity and the services of the Network are closely integrated into these national strategies that are in harmony with the SME policy of the European Commission, and are able to give the efforts of the Europe 2020 strategy substantial support. 2. Needs of the companies in the proposed geographical coverage (max. 3 pages) Target group, beneficiaries The primary target group of Network services provided by the consortium partners are SMEs. Due to being deeply rooted in the regional SME development ecosystem consortium partners have either direct or indirect connections with the majority of active Hungarian SMEs, specifically with those who have potential to internationalize and/or have a capacity to innovate. In order to achieve its general objective, i.e. to increase the innovation level of the SME sector and to improve its international competitiveness, as well as to ensure their sustainable growth, the project offers services to further target groups, where such services clearly support the achievement of this objective. Direct beneficiaries: Based on the experiences gained in the previous project period, the ambitious but realistic goal is to provide Network services to 26,000 SMEs as direct beneficiaries in the geographical area covered by the services. Furthermore, services will be extended to 80 clusters and cluster organizations, 189 SME support and representative organizations and 62 universities, other higher education institutions and research institutes. Indirect beneficiaries: Clients may also utilize Network services indirectly, through several channels, via the partners: Page 4 of 32

55 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Partners carry out active information supply activities, thereby they can communicate useful information about EU topics, the internal market or other areas of internationalization to a wide audience. 2. Client organizations such as clusters, sectorial associations receiving direct services may pass on the knowledge within their own networks or to their own clients. 3. The large clientele of the professional stakeholders is also a indirect beneficiary of the Network services through the existing, wide cooperation network of the consortium. It is expected that 250,000 clients will benefit from partner services indirectly through the above channels during the project period. 1. Identification of perceived needs and constraints and the relevance of the project to the target group 2. The consortium partners are well aware of the obstacles in the path of SMEs sustainable growth, so they developed their integrated services accordingly, tailored to the specific needs of the SMEs offering solutions to these obstacles and fostering development. SMEs needs and constraints in the covered geographical area While micro, small and medium-sized enterprises (SMEs) play a key role in the Hungarian economy and employment, underdevelopment of the SME sector is evident in many areas, and it is also below the European average. A substantial proportion of SMEs typically has low capital supply and technological level, lack and/or has low level of innovation processes, and lacks skilled labour, up-to-date management knowledge and access to foreign markets. The gap between the development level of large companies and SMEs has further widened due to the economic crisis. Consequently, SMEs contribution to economic growth is relatively smaller than their role in employment, and their competitiveness is limited. With regard to the relatively small size of the country and as a result, its limited internal market and highly open economy, the natural direction of the sustainable development of Hungarian SMEs is internationalization, their successful entrance to foreign markets with innovative, competitive products and services. According to the consortium partners experience which is backed-up by the results of several surveys the main obstacles and constraints to successful foreign market activity of SMEs are mainly internal: lack of up-to-date knowledge of foreign markets and technology markets, lack of adequate relationships and networking experience; lack of skills/ability to identify foreign business opportunities lack of capital and access to adequate funding; lack of proper management knowledge and capacities in the area of internationalization and innovation; product, service, process, marketing and organizational innovation is not, or not properly managed, corporate R&D activity is low lack of adequate business, export and innovation strategy and planning Consortium partners provide SMEs with relevant and up-to-date information, capacity-building and skills trainings, expert support and advice and partner search services in order to develop their export activities and establish their cross-border business relationships. A major obstacle to the successful internationalization and innovation, research & development activity of businesses is that the available external financial resources are scarce. Hungarian SMEs use external financing much less often than the EU-average, and the preferred method is still bank financing. SMEs are confused about the various fund raising options and they have difficulties in finding the best solution for their development objectives on their own. A 2012 survey revealed that micro and small enterprises mainly use EU funding while for medium-sized enterprises the primary source of funding are loans. The comprehensive advisory service on access to EU funds and finance, provided within the Network with the assistance of leading professional stakeholders, sees clients through the different stages of fund raising from identifying their need through to the realization of financing. Though national and Community public procurements and tenders offer a predictable and transparent market and significant business opportunity for enterprises, the participation of SME in such procurements is still relatively low! The consortium intends to encourage SMEs to participate in public procurement by providing public procurement consultancy, knowledge transfer and tender alert services. It is typical of the SME sector that it does not pay due attention to improving the energy and resource efficiency of their manufacturing processes and to using environmentally friendly technologies. The Page 5 of 32

56 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE consortium lend effective support in this are as well by channelling in the existing expert knowledge and its established expert network in order to improve competitiveness and ensure sustainable growth. In Hungary almost one quarter of small enterprises and almost the half of medium-sized enterprises are considered innovative in some aspect, while the EU-averages are 49 percent and 65 percent, respectively (Source: Eurostat, CIS, 2012) The National Research & Development and Innovation Strategy 2020 titled Investment into the Future identifies the following main obstacles in the R&D&I area with regard to SMEs: the majority of SMEs lack innovation culture, financial and human preparedness; lack of entrepreneurship and the ambitions to protect intellectual property; business spin-off processes often get stuck; weak intersectoral relationships (company- research institute); SMEs rarely participate in international R&D&I processes; insufficient incubation; slowly developing venture capital raising; lack of state innovation management service; lack of internationally recognized R&D&I managers; low number of R&D&I-based high-tech small enterprises; low efficiency of the adaptive innovations (e.g. due to deficiencies of the ICT infrastructure) Due to their low R&D activity, only few Hungarian SMEs produce innovative, internationally competitive products and technologies, and most of the innovative businesses do not possess the complete set of skills and knowledge to successfully market products and technologies. The consortium can give substantial support for the improvement of the R&D&I potential and activity of the SME sector, on the one hand by providing services that promote R&D activity (e.g. establishing and strengthening two-way relationships between universities, research facilities and enterprises, promoting participation in EU collaborative R&D projects by advisory services and partner search, advising on access to EU funds), and on the other hand by providing businesses with innovation services from the innovative idea through to its successful launch to the market (e.g. innovation and technology audit, innovation management, technology transfer support and partner search, IP consultancy, advising on access to finance, and under the Horizon 2020 program: Key Account Management and innovation management capacity enhancing service)! It is noticeable that businesses participating in international relations are more active in the field of innovation. There is a close correlation between the level of internationalization and the innovation capacity of SMEs; a skill or strength in one of these areas has a positive impact on the other area as well, therefore, the consortium wishes to ensure an integrated service concept based on a holistic approach to support the sustainable economic development of companies. Meeting SMEs needs and constraints with services under Horizon2020 If innovation Management is geared to tangible business impact it helps companies to grow faster than their competitors that do not innovate at all or do not manage their innovation projects effectively. The aim of providing Key account management for the beneficiaries of the SME Instrument and Enhancing SME innovation management capacity for innovating SMEs is to provide holistic service delivery on Innovation Management based on the assessment of companies needs and constraints, including all dimensions and addressing all kinds of innovation not just product innovation. This holistic system includes all major aspects of Innovation Management: Innovation Strategy; Innovation Organization and Culture; Innovation Life Cycle Process, including idea management, product, service, business development, launch and continuous monitoring of innovative solutions. The target audience of the Beneficiaries of the Horizon 2020 SME Instrument services can be clearly identified after winning a phase 1 or phase 2 SME Instrument project. In addition to project driven Innovation Management evaluation and finding the right coach, these companies also need help for preparing reports, and assistance with financial and administrative issues during the implementation of the project. Companies interested in the Enhancing SME innovation management capacity services are more difficult to identify. These enterprises have significant research and innovation (R&I) potential but have gaps in their innovation processes that hinder their potential to successfully commercialize innovative solutions in the international market. An important need of SMEs is the assessment of their Innovation Management performance in order to position themselves to the European innovation level in their sector. A further important need is to Page 6 of 32

57 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE promote their Innovation Management performance. They need an evaluation of their performance and further recommendations for the areas for improvement. The services provided under Horizon2020 will cater for all the identified needs. Opportunities for Hungarian SMEs in third countries Successful entry into dynamically developing non-eu markets is an outstanding development opportunity and key direction for Hungarian SMEs. In line with the related efforts of the European Commission (Mission for Growth program for eg.), the Hungarian Government announced its strategy of Opening to the East in order to take advantage of this opportunity in a concentrated manner, at the same time making efforts to retain our traditional European markets. In 2012 the share of the European Union in Hungarian foreign trade was 76 percent, while EU member states conduct a much smaller portion of their foreign trade within the Single Market, and their target markets are much more diversified geographically. The economies of Asian and South American countries in particular have been developing significantly, thereby offering great economic opportunities for European companies, including Hungarian enterprises, but Arab countries, the CIS countries and the West Balkan are also promising target markets. The consortium intends to use the Network and its tools for the strong support of Hungarian SMEs efforts in this direction. As regards third countries, the basic tools are conveying in-depth market access information involving EU initiatives (e.g. EU SME Centre, EU Japan Centre and the relevant IPR Helpdesks) and other business development organizations (bilateral chambers of commerce, European Business Organisations) and searching for business and technological cooperation partners with the involvement of the Network partners of third countries. Based on the organizational relationship with HTD elaborated later the consortium also draws on the resources and extensive professional background of the MNKH Hungarian National Trading House Cls with relation to market access to third countries. In summary, the most significant obstacles to the economic competitiveness of Hungarian SMEs and their competitiveness in innovation are their lack of access to the necessary information, lack of the required skills and capacities, lack of access to adequate financial resources and funding, and the lack of international relationships. That is exactly where the consortium would like to help Hungarian SMEs to overcome deficiencies and obstacles, and its service concept and methodology was developed with this aim in mind, as it is elaborated on in more detail in Section 8! As presented in detail in Section 1 and this Section 2 the analysis of the Hungarian SME landscape clearly shows that the level of development with regards export readiness, potential to internationalize and capacity to innovate falls behind the average of the EU 15 member states and substantial efforst need to be made to close the gap in the upcoming years. The consortium is commited to provide relevant and tailored services on a broad scope and allocate sufficient resources to this end as the number of SMEs engaging in cross-border partnerships can only be increased with a lasting effect if these obstacles are effectively eliminated thus creating a greater pool of export ready SMEs. Taking into consideration the economic reality and the state of play within the SME sector such development support activities require substanialy higher resources in Hungary than in case of the EU 15 countries. Effective segmentation based on specific needs and targeted service delivery as described in this Implementation Strategy will ensure that the ambitious targets set out by the consortium shall be met. During the planning of targets for the first and subsequent project periods under the scope of this Implementation Strategy partners rely on their experience and targets already achieved in the previous Network ensuring that such targets shall be not only ambitious but realistic simultaneously. 3. Objectives (max. 1 page) Now, when we submit this application Hungary celebrates the 10 th anniversary of our accession to the European Union as a full member state. Member of a regional organization that is worthy winner of the Nobel Peace Prize, as it has brought about reconciliation between the nations of Europe through economic co-operation. The fundamental thought behind the original Schuman Plan is still valid: the organization will ensure the fusion of markets and the expansion of production. However, it is always most difficult to accomplish and support elevated objectives in practice on a daily basis. Keeping these objectives in view, the Enterprise Europe Network provides everyday support to micro, small and medium-sized enterprises in order to further strengthen an already close-knit, unbreakable economic relationship within Europe, helping us to be better acquainted with each other through thousands of business co-operations. In the previous 7-year project period the Hungarian consortium was fortunate enough to see and support it all from the inside. Put to the test at international level, our consortium delivered excellent performance, helping to reduce the disparities in productivity and thereby in regional development within Europe through business co-operations and through technology transfers between SMEs, thus making the European economy more homogeneous. Our everyday work facilitated the catch-up of the economy of our region, and within that of our country, with the European Union average. Page 7 of 32

58 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE We wish to continue contributing to achieving these goals in the future, that s why our consortium applies again for this reputable role, the Enterprise Europe Network partnership under the new call for tender. We have acquired considerable knowledge during the past 7 years, which will help us carry out more efficient and targeted work in the future. We shall place increased emphasis on priority services: quality will prevail over quantity. We intend to achieve this goal through even closer co-operations, improving in three fundamental areas: 1, disseminating co-operation and expertise within the consortium, 2, making better use of the partnership network of the Enterprise Europe Network, especially as concerns their non-eu partners, 3, further integration into the local ecosystem. In the latter area based on experiences gained in the past 7 years we will establish so-called strategic co-operations with the major key players, which shall mean work for a common goal based on mutual benefits. With their assistance we will complement our range of services by further professional services based on the needs of SMEs. To make the work we perform with the support of Brussels visible for the target audience and in a wider sense for the general public, the citizens of Europe, remains one of the greatest challenges we face during our work. The Network Ambassador Scheme we launched in the previous tender cycle will be continued, because the basic idea has clearly proved true: other companies, our existing clients can provide companies and potential clients with the best and most convincing reference for our reliability and the quality of our services. It is our Ambassador Scheme that helped us establish a new consortium with the ideal composition. The consortium will involve a single new member in addition to those who already proved themselves in the previous tender cycle: ATEKNEA, a company performing innovation services in practice, deeply embedded into the local ecosystem. This move means that one of our excellent SME clients will become partner in the consortium in addition to the existing members, i.e. chambers of commerce, business development foundations and a state export development agency. SMEs demand and entrepreneurship thereby become a kind of in-house affair, which will help us fine-tune our customized services to companies. We will embark on the next project period with this experienced, professionally diverse, geographically complementing partner team, putting the slogan of EU into practice: united in diversity. Throughout the implementation of the project synergies with other European programmes that support European SMEs shall be developed and exploited to maximize impact of European initiatives to the benefit of SMEs. Where possible the transnational support of the Network will be closely harmonized with the internal support provided by national operational programmes under the European Structural and Investment Fund (EISF) especially the Economic Development and Innovation Operational Programme to ensure that actions carried out under COSME and EISF grants complement and strengthen one another. 4. Organisational and staff competences (max. 5 pages) Description of the consorium proposed to implement the project The Hungarian consortium consists of nine members. The coordinator is HTD, 5 partners are Chambers of Commerce, 2 partners are members of the Hungarian Foundation for Enterprise Development and ATEKNEA is an SME providing highly specialized innovation and R+D services to other SMEs. The diverse organisational background and expertise enables the consortium to provide services in an integrated manner as a single network. The No wrong door principle is ensured via strong coordination, members competence, cooperation with stakeholders and a clear sign-posting system. The consortium will cover all seven NUTS2 regions in Hungary providing a national coverage for the Network services. The consortium partners constitute an unique knowledge and expertise pool and an exceptional client outreach in Hungary ensuring significant impact of services. Clear division of tasks and visible geographical coverage guarantees to respond efficiently to the SMEs needs with integrated services. Partner 1/ Coordinator: The Hungarian Trade Development Llc (HTD) HTD s sole shareholder is MNKH Hungarian National Trading House Cls a corporation established jointly by the Hungarian Government and the Hungarian Chamber of Commerce and Industry - the former holding approximately 99% of the shares - with the mission to aid Hungarian companies especially SMEs develop their export activities and provide internationalization support services. In accordance with the Hungarian Government s decision all non-profit trade development and export promotion services of the previous Network coordinator organization Hungarian Investment and Trade Agency (HITA) are Page 8 of 32

59 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE carried out by HTD as a subsidiary of MNKH Hungarian National Trading House Cls and as integral part of the Hungarian National Trading House brand. The Hungarian National Trading House operates under the supervision of the Ministry of Foreign Affairs and Trade. HTD operates in close cooperation with the Hungarian foreign trade diplomat network, present in 49 countries in 63 local representations all over the world. The common objective of both organizations operating under the Hungarian National Trading House brand is to support Hungarian SMEs in retaining and further developing their traditional export markets in the EU as well as gaining a foothold on new dynamically growing markets (for eg. Balkan countries, East Europe, Far East). While MNKH Hungarian National Trading House Cls provides export transaction management and intermediary services on for-profit basis HTD as a separate legal entity provides not for profit export promotion and trade development services to SMEs. HTD under the Hungarian National Trading Hose brand has established an active relationship with relevant regional and national stakeholders such as professional sectorial associations, universities, clusters, public authorities, EU Networks, the Representation of the European Commission in Hungary, and other local actors. HTD has strong relationship not only in the EU but beyond (investment and trade agencies, and other business support organizations). Hungarian National Trading House has in place several cooperation agreements with national organizations and memorandum of understandings with foreign business support organizations. Partner 2: ATEKNEA Solutions Hungary Ltd. (ATEKNEA) is the most important private innovation management organization in Hungary helping Hungarian organizations to join the European Research Area. ATEKNEA assisted more than 100 Hungarian SMEs, Universities, research centres and associations in the region to reach and participate in several FP6, FP7 and other EC funded research and development focused projects. ATEKNEA s company base consist of highly innovative SMEs with a potential to successfully participate on EU funded R+D projects and to bring their products and developments to international market. To this end, ATEKNEA has developed a successful methodology for innovation capacity building in SMEs and has substantial experience in managing R+D projects at SMEs and also acting as a bridge between the academia and the business sector. ATEKNEA is member of IVSZ - ICT Association of Hungary and Innoskart ICT Cluster having an active role in the Hungarian research and development ecosystem. ATEKNEA successfully participated in 17 FP6 and 45 FP7 funded R&D projects. Partner 3: Established 1994, the Chamber of Commerce and Industry of Fejér County (FMKIK) It fulfills its duties in accordance with the provisions of the Chambers of Trade Act. Registered over economic actors of Fejér county. It plays a decisive role in the economy and the development of the Central Transdanubian Region and helps businesses with up to date information. The Chamber s services include series of training programmes i.e. an asset to be capitalized on and required to development, and also the trade development programmes that support the establishment of business relationships and organization of large-scale international events. Its mission is to act as intermediary organisation between significant players of innovation, R&D, IT development, renewable energy industries and help building relationships between the region's entrepreneurs, universities and other organizations, to help domestic and international regional economic cooperation. It has 62 signed cooperation agreement with stakeholders. The Chamber's international relations are extensive and has more than 50 region-wide project references. Chamber hosted the EIC HU735 from 2003 Joined the Enterprise Europe Network in 2008 and became Merlin Champion and SME Feedback contact point International membership: ICC, Carpathian HU-RO CCI, Slovakian-Hungarian CCI, DCCA, DUIHK. Quality Management: ISO 9001:2008; accredited adults education institutions (AL-1300). International awards: Committed to Excellence, Recognise for Excellence 4-Star; Award winner of the "European Enterprise Awards" of the Hungarian national rounds. Partner 4: Chamber of Commerce and Industry for Győr-Moson-Sopron County (GYMSKIK) was founded in It contributes with various means to the development of regional economic environment and supports the development of the enterprises offering wide range of business and innovation services to all type of companies representing industrial, commercial, service and craft sectors. Due to the compulsory registration GYMSKIK has a client database of more than enterprises from GYMS county and due to the partnership with other stakeholders like regional CCIs and Regional Innovation Agency (partly owned by GYMSKIK) it can reach further enterprises from the region, ensuring a strong client base. GYMSKIK has many years cooperation with the regional SME development organisations, local authorities and universities and directly manages a metal industry and vocational cluster. GYMSKIK cooperates with different foreign Chambers and other SME development organisations and it is reliable partner in numerous EU funded cross-border projects dealing with business development, innovation and technology transfer. GYMSKIK has signed LoI for cooperation with a Chinese chamber and other Chinese regional business development organisations because intends to develop the business cooperation between the two countries. The Chamber will operate an Intellectual Property Information Point of the Hungarian Intellectual Property Office from GYMSKIK is member in international organizations (ICC, DCCA etc.) and Network partner since Partner 5: Zala County Foundation for Enterprise Promotion (ZMVA) was founded in 1992 by the Municipality of Zala County. ZMVA is member in the EMN (European Microfinance Network) and the Hungarian Microfinance Network. The main objective of ZMVA is to support the establishment, survival and first of all the Page 9 of 32

60 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE growth of SMEs in all part of the SME community by operating a central office and a county-level sub-office network (5 offices). ZMVA has a client base of 2500 companies. Main fields of activities: ZMVA offers many types of micro credits for micro SMEs from Enterprise Incubator House program in three towns. ZMVA was the member of the EIC Network from and joined the EEN Network in 2008, so it is experienced in advisory service on EU legislation, regional development programs, financial resources, business management, chances of entering the international markets, etc. Thanks to the geographical position (tripleborder region) the development of cross-border cooperation is emphasized activity both towards Austria, Slovenia and Croatia. ZMVA has great experience in trans-national EU projects and can build synergies and complementarities between these projects and Network activity (SEE, Interreg,Cross-border). ZMVA is one of the founders and owners of Pannon Novum West-Pannon Regional Innovation Agency. Partner 6: The Chamber of Commerce and Industry of Pécs-Baranya (PBKIK) was founded in Besides the compulsory duties to foster the organisation and development of the of the economy, to boost business activities, to guarantee the fairness of the competition (XVI. act of the year 1994), the chamber has been very active in elaborating new methods and transforming new ideas into concrete projects in different fields. /eg. innovation management tools, intellectual assets and IP valuation/. As one of the strongest chambers in Hungary and regional centre of Southern Transdanubia it has a database of enterprises (at county level, compulsory registration) - representing the industrial, commercial and craft sectors and focusing mainly on internalisation, commercial development, innovation, R&D, clusters, vocational training and cross-border activities with Croatia. The Chamber of Commerce and Industry of Pécs-Baranya has many years of mutual cooperation with regional SME development organisations, local authorities, universities, research institutes, industrial parks and clusters. (Signed cooperation agreement with 16 clusters out of which 3 are managed directly by the chamber.) The Chamber operates the Regional Innovation Centre since 1995, is a partial owner of the Regional Innovation Agency and operates the Intellectual Property Information Point of the Hungarian Intellectual Property Office. The Chamber of Commerce and Industry of Pécs-Baranya hosted the EIC (Euro Info Centre HU730) from 1999 and joined the Network in PBKIK is a partner in several international projects and member of different European organisations and networks as well. (e.g. ICCH, UECC, DCCA) Partner 7: The Chamber of Commerce and Industry of Hajdú-Bihar County (HBKIK) was founded in It's mission is to represent the interest of the local business community, to supply value added services and information to the enterprises, supporting with different services the innovation and business development in the region. The Chamber has the capacity both from mission and geographical coverage and with skilled staff to reach out to the SME community and deliver the services. Due to the compulsory registration it has a wide client database (49 000) and links to the SME-s. Connection and good cooperation in the own geographical region with SME development organisations, universities, clusters, local authorities and with the Bilateral Committees for Foreign Relations of the Hungarian Chamber of CI. Due to its geographical position the development of cross border cooperation is a vital part of the activities of the Chamber. Knowledge and experience in cross-border project implementation, in task of cross-border business and innovation development. CCI of Hajdu-Bihar county has been a Network partner since 2008, Cluster Contact Point in The host has established cooperation with chambers in Europe and in third countries as well. Partner 8: The Foundation for Enterprise Promotion of Szabolcs-Szatmár-Bereg County (PRIMOM) has been established in 1991 and plays an important role in the business life throughout the county. PRIMOM is member in the EMN (European Microfinance Network) and the Hungarian Microfinance Network. The main target group are SMEs. The foundation s main task is offering many types of micro credits for those SMEs who would not be able to get credits from commercial banks.the activities such as incubation, writing and guidance of projects, financial and agricultural consulting, cover the entire spectrum from start to national market access. Due to the geographical position, the Foundation have been participated in many cross-border projects, thus It has experiences and comprehensive cross-border relations. While the Foundations main role is to give financial and specific advisory service for SMEs in order to enter national market, the EEN offices services are the next step for these enterpreneurs: entering into international market.. The organization has participated in the network from 1999 to 2007 as EIC, then from 2008 as Network partner, enabling companies into the wider international market. PRIMOM has a client base of companies. Partner 9: Chamber of Commerce and Industry Csongrád County (CSMKIK) was established in 1890, and has a large client base of companies from the fields of trade, industry, services and crafts. The role of the chamber is to support their members and the actors of the business sphere, through the improvement of entrepreneurial environment, economic analyses and forecasts, the coordination of vocational training, providing consultation in legal, taxation, innovation, internationalisation and other matters. CSMKIK hosted an Euro Info Centre from 1999, immediately joined the Network in 2008, and also participated in a Specific Action. CSMKIK has stong cooperation with the other two CCIs in the region, other SME development organisations, clusters, research centres, universities and other EU information services. As the county is in the Romanian and Serbian border region, Serbia and Romania are among our main focuses. CSMKIK is the founder member of the Romanian-Hungarian CCI, and founder member and gestor of the Serbian-Hungarian CCI. Specificities of HORIZON 2020 activities of those partners providing these specific services: Page 10 of 32

61 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE As a partner specialized in innovation management with extensive experience ATEKNEA shall be the coordinator of HORIZON 2020 activities within the consortium. ATEKNEA has worked with more than 500 SMEs from all over Europe and 50 SMEs from Hungary in developing innovative technological solutions. The clients in Hungary include high tech innovative SMEs, also SME Associations, Chambers of commerce and industry as well as their members. ATEKNEA has competencies in applying innovation management tools such as the IMP³rove, which fulfils CEN/TS standard. IMP³rove has created the basis for a European model to develop the Innovation Management capabilities in Europe. ATEKNEA has experiences in: Innovation Management assessment and benchmarking for SMEs; Innovation Management consulting services; Training and certification in Innovation Management and in Innovation Management consulting. HTD, FMKIK, GYMSKIK, PBKIK and HBKIK shall also be providing services under HORIZON 2020 based on their innovation managament services provided in the context of Network activities in All of these partners have the necessary professional competence and the experienced and skilled senior innovation expert staff, which enables them to provide relevant in-depth innovation management capacity building services to suitable SMEs. Role and place of the Network in the organigram of each host organisation Partner 1/ HTD: As the Network project is a priority to the host Network related activities are carried out by a separate department (Enterprise Europe Network Department) within the Enterprise Europe Network and SME Export Promotion Directorate. The Network Department is organized mainly in a horizontal approach based on Network activities and is complemented with a focus on specific sectors. Network activities are clearly separated from the host organization's other services and are additional to core activities, effectively complementing those. The Network logo is present at the host s webpage, at the entrance and the office as well as in signatures of Network colleagues. Partner 2/ ATEKNEA will create a separate group within its organizational structure to manage and implement Network functions and activities and clearly separate the related duties from other activities of the organization. The Leader of the Network group will directly report to the Managing Director of the organization representing Network related activities on the highest management level of the organization. Partners 3-9: The Network membership is a key priority for the Host organizations, the logo is shown both on their web sites and their premises. The Network's headquarters are situated in the Host s building, in a physically separated office with highly visible branding materials, organisationally integrated in the Host s structure. Staff works in cooperation with colleagues on other international issues, and has certain functions and responsibilities in the Host organization. The executive officers of the Hosts (secretary generals at chambers, and managing directors at foundations) are also involved in Network activities, they participate in National meetings, take operational tasks in the Network (e.g. holding lectures) thus they ensure the communication and collaboration within the organization. There are weekly manager meetings in all Host organizations with the participation of the Network project manager, and there are also regular project meetings for Network staff members. The team proposed for the implementation of the project by function Partner 1/ HTD: A coordinator, who is also and IPR expert, an innovation expert and advisers (R+D partner search, access to EU funds, access to finance, public procurement) colleagues specialized in partnering services with special knowledge in certain highlighted sectors (ICT, health, environment for eg.) and substantial SME training background shall make up the Network staff at HTD. Staff is highly trained and has long term professional experience in SME support services. Most colleagues participated in the Network in the previous period as staff of the former coordinator organization and some of the senior colleagues were already active in the EIC, IRC networks. As HTD is responsible for the coordination of the PR, marketing and communication activity on national level, a senior colleague in communication field will be involved. HTD supports the staff retention and continuity with motivation, capacity building trainings, internal trainings in order to keep on the excellence in performance with an experienced, proactive staff. To ensure high visibility for the whole Network on a national level and also on a policy maker level management of HTD are actively involved in the activities of the Network. The CEO is at the same time leader of the consortium representing the unity of the Hungarian Network. Partner 2/ ATEKNEA: The Network group within ATEKNEA will consist of highly trainned staff, having all necessary knowledge, experience and skills to implement the Network activities on a high level. The group will include senior members with sufficient educational and substantial professional background in business management and engineering, supported by required experience in innovation management. Partner 3/ FMKIK: The Chamber has a HR management document which define the required competencies of staff, including EEN Staff. Meeting the above requirements EEN staff has long term professional experience in SME support services, expertise and experience in the field of PR, marketing and communication, Page 11 of 32

62 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE internationalization, innovation, R&D and project management. Colleagues specialized in partnering services, have sector and country specific knowledge. Most of the colleagues participated in the EIC Network. Partner 4/ GYMSKIK: The Network staff has already built up a sound knowledge regarding the core industries of the region (automotive and metal industry, machinery, ICT etc.) and the mostly targeted countries (A, SK, CZ, D) over the previous period. Besides that a HR plan identifying the relevant knowledge and competences for each Network service indicated in the WP was elaborated and will be used in the coming period to ensure continuity for our clients. Senior staff members will deliver services such as internationalization, partnering services, innovation, IPR consultancy, access to finance, R&D&I services, PR. Partner 5/ ZMVA: The Foundation has high qualified employees, who have relevant experience in project generating and implementation of international projects. The number of colleagues, the existing infrastructure as well as the financial background make the successfully arrangement of the project. Senior consultants expertise in access to finance, marketing, PR, partnering services, IPR, innovation and cluster management, public procurement, etc. Staff s time spent for the implementation is based on the activities set in the WP and their experience, knowledge and competences. Partner 6/ PBKIK: The Network team is highly trained and has long term professional experience in SME support services. The colleagues participated in the Network in the previous period and the project leader was active in the EIC networks as well. Senior consultants expertise in marketing, PR, export, partnering services, IPR, innovation and cluster management, public procurement,etc.) Each staff member is responsible for a highlighted sector (machinery, creative-, health environmental industries, ICT and tourism) or a country of special importance. (eg. Croatia, Germany, Austria etc.) Partner 7/ HBKIK: THe EEN Staff with senior staff members, are experts in the field of business development, cross-border partnering support, IPR, innovation. Host is motivating the staff, there is a continuous training both in relation to the Network and on specific field of activity. The staff has the expected qualification for the different tasks, and experience in working directly with SMEs. Partner 8/PRIMOM: The Foundation has high qualified employees, who have relevant experience in SME support services: micro-financing, project generating and implementation of international projects. The colleagues participated in the Network in the previous period as well. Partner 9/CSMKIK: The Enterprise Europe Network team consists of senior consultants (including the project leader) with expertise on PR, internationalization, innovation, R&D and project management, junior consultants with expertise on communication, organizing local events and access to finance and a dedicated person for the financial management. All consultants have a sector specific knowledge in one of the relevant industries of the region. To ensure that there is no overlap with normal activities of the host organization and the addinitionality principle is respected all consortium partners will uphold the following standards: The Network offices operate functionally and physically separately, yet organisationally integrated. All Network related activities are clearly labelled and separated in the annual business planning and in-house reporting. Internal regulation is in place at all partners on carrying out international projects, which determines the strict management of such projects. The expenses of the project are separated by unique identifier codes in all processes of planning, accounting and documentation. The time spent on project is recorded on monthly basis in a separate Time-sheet signed by the staff member and approved by the superior. Relevant funding received under the project is kept under an separate sub-account. All Network related activities and events are labelled and branded in accordance with the branding guidelines and other related Network guides. Project related documents are regularly monitored by financial controlling, and also by an external auditor. The host organisation ensures the own contribution - above the EU grant - for the financing of the Network project. Partner 2/ATEKNEA: Additionally to the above the for-profit activities of ATEKNEA and Network services shall be clearly separated both internally and in external communication and separately handled in accounting and all other relevant internal procedures. ATEKNEA will separate its Network services from its business operations in the following areas: - A separate organisational unit will be managing and representing the Network activities within the company with a declared and clear task and work description. The unit will have empowerment to ensure the high quality implementation of Network services and will report directly to the Managing Director of the company. The services of the separate unit will be open to any client or target company of the Network, independently from the business interests of ATEKNEA. - In the financial area all cost and revenues linked to the Network activities will be handled separately. The company will create separate cost center and general ledger for this purpose within the accounting system. - In marketing communication the company will ensure that the Network activities and business activities will be communicated to the public separately. All publications, event participations and other communication and dissemination actions will be clearly appointed to either the Network activities or business services. The Managing Director of ATEKNEA together with the coordinator of the Network will regularly monitor and Page 12 of 32

63 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE evaluate the effective and required separation of Network activities from for-profit business activities. Further ensurance of the additionality principle via clear sepparation of host core activities and Network activities is provided in detail in Section Consortium organisation (max. 3 pages) How the Network activities complement the existing business support of the host organisation Partner 1/ HTD: The Network services complete the export promotion services of the host with horizontal and market access services without sector restraints, and additionally added value sectorial knowledge with an EU dimension through Sector Group memberships. High added value advisory and support services in horizontal subjects and standardized Network cross-border partnering services including the partnership opportunity database and matchmaking events are also additional to the basic services of the host organization. The main services of the host organization regarding trade development are organisation of government level trade missions and bi-lateral joint economic committees to foreign countries with delegation of SMEs and providing national stands to Hungarian companies during major international trade shows and exhibitions abroad. Joining to these events the Network organizes company missions and brokerage events in cooperation with other Network partners which results in a complex service package for clients. The synergy between basic host services and Network services with an EU dimension results in comprehensive and effective service delivery to the SMEs. Partner 2/ ATEKNEA: ATEKNEA is permanently improving its innovation management services towards its clients and partners. Network related activities will add an EU dimension with significant value and new consultancy services to the current service line by ensuring general information flow also out of ATEKNEA s basic fields of interest. Preparation and dissemination of technology profiles, SME Feedback activity and organization of events under the scope of the Network project will also be a new service in ATEKNEA operations. Network services will be offered and provided to all suitable SMEs within the covered geographical area without sectoral or other restraints and on a non-profit basis. Partner 3/ FMKIK: The support and services provided by the Network are much more depth and, specific. Host renders general activities to all of the enterprises, while Network focuses on a segment of enterprises with innovative capabilities that enables them to enter into foreign markets. Network offers more intensive and high added value specific services focusing partnering services, technology & innovation, dissemination business offers and opportunity to join to the business databases. The business programmes are tailored by sector specific topics. Network escorts and mentors the whole business support till successful partnership agreements. Partner 4/ GYMSKIK: Study tours, exhibition visits, thematic club events, conferences are organized regularly by the host organisation providing an excellent base for complementary Network activities like organisation of CMs or BEs, contacting potential clients for partnering activities, offering access to finance tools and other tailormade services. The host offers services in field of enterprise development for all types of businesses and in all sectors except of agricultural activities, while the Network is focusing on SMEs (involving agricultural enterprises) initiating partnering and RDI cooperation based on Network tools, ensuring a significant added value to the basic activities of the host organisation. Partner 5/ ZMVA: Host offers services primarily for micro- and small sized enterprises. Foreign marketable SMEs have become our clients mainly since 2003, when ZMVA gained membership to the EIC network. Providing deeper advisory services and arranging matchmaking events are the task of the Network department. We are mainly involved in events arranged by our international Network partners and we also organize joint company missions with foreign Network partners we became acquainted with via the Network. Thanks to the above mentioned facts, the activities of the Host and the Network can be separated clearly. Partner 6/ PBKIK: The services provided by the Network are much more in depth, specific (eg. excellent tools and methods like Partner Opportunity Database) and comprehensive than the ones provided by the host organisation. They are tailored for SMEs, while the chamber provides its services to all companies. The host provides services for companies coming from the industrial, commercial and craft sectors. SMEs coming from the agricultural sector are interested in getting information from the EU or even taking part in sector specific events which can be served via the Network. Events at regional or international level organized by the chamber can be offered with more success for SMEs if there is an accompanying brokerage event organized by the Network partners. Partner 7/ HBKIK: The activites of HBKIK cover the entire county providing mainly general information and consultation services to the enterprises in order to increase their competitiveness and innovation activities. The services provided by the host are in general, for all companies, while the services of EEN are much more indepth, specific and tailor made for SME-s in different sectors. SME-s of agricultural sector are also target group for the Network, while not for the host organisation. The Network with its Partnering Services complement the Page 13 of 32

64 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE basic and general services of the host. The Network is a priority project of the host with a high degree of visibility, communication activity and connectivity with other SME departments of the host. Partner 8/ PRIMOM: The Foundation's financial, tender and incubation activities are independent from the network's profile. The host offers services primarily for micro- and small sized enterprises. The Foundation main objectives are giving information, consultancy in subject of economic, financial, agriculture, tenders, access to finance. The network completes these activities by helping the SMEs to enter into the international market. Partner 9/ CSMKIK: In recent years the Host gained significant experience in providing result and effectoriented Network services. The basic business development and advisory services provided by the Host, served as good basis for Network services, which focus on the international and cross-border activities of SMEs. According to chambers legislation, agricultural companies are not clients of the Host, but they give an important segment of the Network's client base, and this synergy made the Host able to have a complex picture of the needs of the companies of the region for enhancing their competitiveness. Project coordination mechanism Project coordination at management level: - National meetings (consortium meetings): The main coordinating body within the consortium, where every partner is represented. Held at least four times per year with the active participation of heads of the host organizations and Network office managers and chaired by the leader of the consortium. - Meeting of Network office managers: This operative group has its meetings/teleconference calls between National meetings and ensures close cooperation in operational matters and dissemination of good practices to ensure high performance. Also its purpose is to streamline decision making by preparing the agenda for the National Meeting. Project Coordination at technical level: - Internal working groups: Partners have established four working groups on communication, innovation, cross-border partnering and financial affairs to facilitate an intensive level of professional cooperation within these priority subjects. There is a quality control group for profiles formulated by the internal reviewers at partners. The working groups have emphasized function in planning processes and development activities. Each partner has a representative in every internal working group with the adequate professional background. - Further ad-hoc professional groups in the analogy of Working Groups shall be assembled on a need to have basis. The coordinator is responsible for ensuring close and effective cooperation in project management and implementation. It is also the coordinator s task to facilitate quality control and regular internal progress reports as described in detail in the relevant work programme. The role of each host organization in the consortium and the geographic area covered Partner 1/ HTD shall be providing information, advisory and support services, cross-border partnering services, and SME Feedback services under COSME. Partner shall also be providing key account management and innovation management capacity enhancing services under Horizon Special focus on innovation and IP management, R+D partner search, green entrepreneurship, start-up companies, public procurement and environment, ICT, agrofood, health, biotechnology sectors. Geographical area covered: Central Hungary, NUTS2 HU10 and North Hungary NUTS 2 HU31 via the HTD offices in Eger and Miskolc. Partner 2/ ATEKNEA: shall be providing information, advisory and support services, cross-border partnership profile services, and SME Feedback services under COSME. Partner shall shall be coordinating the key account management and innovation management capacity enhancing services under Horizon Special focus on innovation and technology audits, technology transfer, innovation management and coaching of SMEs for partcipiation in Horizon ATEKNEA will constantly provide trainings and support on specialized innovation services to all other consortium partners and thus contribute to the continuous improvement of innovation services of the whole consortium. Geographical area covered: Central Hungary, NUTS2 HU10 Having ATEKNEA as a second partner providing Network services in the Central Hungary NUTSII region along with HTD is justified by the fact that the largest number of SMEs in Hungary are registered in this region, with highest number of innovative SMEs. Partner 3/ FMKIK: shall be providing information, advisory and support services, cross-border partnering services, and SME Feedback services under COSME. Partner shall also be providing key account management and innovation management capacity enhancing services under Horizon Focusing on green economy, Page 14 of 32

65 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE renewable industry, automotive and vehicle industry, logistics, furniture industry, electronics and ICT. Special focus on young entrepreneurs target group. Geographical area covered: Central Transdanubia, NUTS2 HU21. Partner 4/ GYMSKIK: shall be providing information, advisory and support services, cross-border partnering services and SME Feedback services under COSME. Partner shall also be providing key account management and innovation management capacity enhancing services under Horizon Special focus on Services Directives related advisory services, access to finance, innovation management and efficient use of resources, automotive and metal industry, machinery, electronics and ICT. Geographical area covered: Western Transdanubia, Győr-Moson-Sopron and Vas Counties, NUTS3 HU221, HU222 Partner 5/ ZMVA: shall be providing information, advisory and support services, cross-border partnering services, and SME Feedback services under COSME. Special focus on access to finance, wood-and furniture industry, metal- and mechatronics indutry, machinery and tourism. Geographical area covered: Western Transdanubia, Zala County, NUTS3 HU223 Partner 6/ PBKIK: shall be providing information, advisory and support services, cross-border partnering services, and SME Feedback services under COSME. Partner shall also be providing key account management and innovation management capacity enhancing services under Horizon Special focus on innovation, IPR, start-ups, public procurement and the agrofood, health, machine-, creative-, environmental and health sectors. Geographical area covered: Southern Transdanubia, NUTS2 HU23 Partner 7/ HBKIK: shall be providing information, advisory and support services, cross-border partnering services, and SME Feedback services under COSME. Partner shall also be providing key account management and innovation management capacity enhancing services under Horizon Special focus: intelligent energy, internalisation, innovation, clusters, EU legislation watch service, company missions, MfG events national coordination. Geographical area covered: North Great Plain, Hajdú-Bihar and Jász-Nagykun-Szolnok Counties, NUTS3 HU321, HU322 Partner 8/ PRIMOM: shall be providing information, advisory and support services, cross-border partnering services, and SME feedback services under COSME. Special focus on agrofood and renewable energy sector, start-up companies, support to finance and incubation. Geographical area covered: North Great Plain, Szabolcs-Szatmár-Bereg County, NUTS3 HU323 Partner 9/ CSMKIK: CSMKIK shall be providing information, advisory and support services, cross-border partnering and R&D&I services, and SME Feedback services under COSME. Special focus on green entrepreneurship, start-up companies, sustainable construction, ICT, agrofood, health, biotechnology sectors. Geographical area covered: South Great Plain, NUTS2 HU33 Matrix mapping the activities to be performed by each partner and their specific competencies Page 15 of 32

66 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Service Delivery Chart of the the Hungarian Consortium 6. Communication strategy (max. 2 pages) National Communication Strategy Having regard to the fact that the consortium covers the whole country with its services, a national communications strategy is required to ensure country wide visibility of the Network. Formulated in 2012 with the assistance of a professional communications and PR agency, this strategy forms the backbone of the consortium s communication activities. The primary objective of this strategy is to use communication and marketing tools for the support of the strong position of the Network in the Hungarian business development ecosystem, and to reinforce the role of the Network, as the primary support instrument for SMEs in the fields of internationalization and innovation. In-depht target group, internal and external stakeholder and environment analyses were conducted before the development of the strategy. The strategy classifies the SME sector and other potential clients according to how relevant Network services are to them, i.e. on what level they are in terms of readiness to go international and innovation skills. Customized communication channels and sets of specific tools are assigned to the identified target groups to facilitate an effective reach. Concerning clients already using Network services, the aim is to strengthen the relationship and brand loyalty with the right communication tools. In case of potential clients who can make effective use of Network services, the primary objective of communication activities is to attract them to the services and make them core clients of the Network. SMEs currently lacking potential for internationalization and innovation will be targeted with educational EU information with a view to business development, using wide-reaching, cost effective communication tools, thus making sure that the Network will be the key communication channel towards SMEs for the Commission. Effective communication shall be conducted towards stakeholders, regional policy makers and political decision-makers that play decisive role in the area of business development, and last but not least towards the own host organizations in order to reach a high level of embedment. The strategy identifies the right tools for reaching the above target groups, and the consortium has already gained considerable experience in using such tools during the previous project period. The long-term relevance and applicability of this strategy is guaranteed by the fact that it contains several dynamic elements whereby it can meet and adapt to the challenges of a changing environment. Communication Working Group for closer cooperation in visbility raising activities A communication working group consisting of the consortium partners communication, PR and marketing experts is responsible for putting the consortium s communications strategy into practice and implementing Page 16 of 32

67 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE it on a national level. The workgroup will prepare a communication workflow every six months for the relevant period and action plans for the actual campaigns based on the strategy, and will also give directions for partners for the preparation of their own regional communication action plans. Each partner will prepare its own regional communication action plan and will revise it every six months, following the workgroup s guidelines. The communication working group shall be responsible for the regular supervision of the partners compliance with branding rules and the provisions of the visual identity guidelines. The workgroup may offer recommendations to certain partners if necessary. Strong online and social media presence In addition to traditional offline tools the consortium intends to place ever more emphasis on cost effective online promotion and communication during its communication activities, and wants to significantly increase the number of those clients who subscribe for online contents. The existing national website ( is already a central element of communication activities, but it will be further developed just like the partners own websites to allow closer integration with social media, smart phone and tablet applications. Partners were particularly active in improving visibility in the previous project period; several good practices, acknowledged by the EASME, were developed and put into practice successfully (e.g.: communication working group, Brand Ambassador program, promotional short films, annual reception for stakeholders, etc.). The consortium partners intend to improve their presence in the social media (Facebook, LinkedIn, YouTube), and will conduct active promotional campaigns with the assistance of professional consultants on these platforms. Moreover, following the latest content consuming trends, a Network smart phone and tablet application will also be used. Visibility within the host organization Ensuring high visibility within the host organization is a key aspect of being able to deliver high added value services to a large group of SMEs under the Network. Since all of the host organizations working with the consortium give priority to the Enterprise Europe Network project, they ensure the required visibility of the Network identity for partners, both inside and outside the organization. For detailed description of visibility raising activities carried out under the communication strategy please refer to the relevant work programme. Monitoring impact achieved by communication activities To measure efficiency, consortium partners examine several KPIs (Key Performance Indicator), which may be different for each target group. For example, in case of communication activities targeting potential clients the number of new clients is a basic indicator of whether the targeted SMEs could be reached, while general information service is best measured by the increase of website traffic or, for example, the number of new subscribers for the RSS Feed, newsletter and the online automated services or the social media platform. For stakeholders, a main indicator is the increasing number of joint events, joint appearances and meetings. As for online communication activities, partners will use the available analytical tools, e.g. Google analytics, Facebook analytics, etc. Monitoring the efficiency of certain activities and campaigns, and the continuous integration of the results thereof into the communication action plan belongs to the responsibility of the communication staff on local level and to the responsibility of the communication working group on national level. a) Selection and follow-up of success stories Success stories and their communication to target groups is one of the most efficient communication tools, which at the same time strengthens the Network s status as an organization providing high value-added professional services. Identification and selection of the success stories to be communicated is an integral part of the follow-up procedure of advisory and support services and cross-border partnering services. Success stories are built on successes and achievements that simply and clearly illustrate what kind of support SMEs may receive from the network for achieving business success and improving their international competitiveness. Partners use such success stories in several areas of their communication activity. Thematic publications always contain relevant success stories/quotes in order to reinforce their message, and we not just refer to such stories in our presentations but often invite the successful company itself to events so that they can share their experiences first hand. Partners not only promote their success stories in their own region but send them to the country website as well, where they are displayed on the main page, and each month one story is selected to be highlighted. Consortium partners forward the best success stories also to the agency so that they can be published internationally. Network Ambassadors One of the most unique and effective tools in reaching SMEs is the Enterprise Europe Network Brand Page 17 of 32

68 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Ambassador program of the consortium. Live success stories, SMEs who intensively promote Network services to other SMEs based on their own experience. Selected from core clients who reached substantial success with the aid of the Network, and are well-known and respected in the SME community. Their role is to deliver the message that the Network can help other SMEs to go international. This initiative was highly regarded and recommended as a good practice to other consortiums by the EASME. Quote from one of the Ambassadors: The Network brings tangible results: time, money, contacts and information b) Contribution to the Network's overall communication strategy The consortium already has a delegated National Communication Correspondent in the Communication Correspondent group, established by the EASME, who actively participated in the group s work. The consortium shall maintain this position because it is an excellent two-way communication channel. On the one hand, there is a continuous opportunity to learn about the elements of the Network s general communication strategy and the good practices of foreign partners and to adopt them into the national communication, and on the other hand it is an excellent platform for the dissemination of the Hungarian consortium s good practices. As a result, partners may actively participate in the development of the Network s communication on international level. In recent years the consortium prepared annual summary reports for the agency on the efforts to increase visibility, and intends to follow this practice in the future. Similarly to the previous period, consortium partners shall keep on adhering to the branding rules and visual identity guidelines published by the EASME, and shall actively use the branding and communication tools made available to them. 7. Cooperation with local, regional and national stakeholders and with organisations located third countries covered by the Network (max. 2 pages) Role and place of the consortium in the regional business development ecosystem In the previous period the Hungarian Network set itself the aim to become a dominant player of the local, regional and also national business development environment. In order to achieve that, and building on the host organizations unique regional embedment and numerous co-operations, it has established relationships with the relevant stakeholders, with special focus on the Network services; these relationships have been continuously expanded and strengthened, with plans to continue for the period. In the areas covered by the services the business support environment comprises of state institution, local governments, chambers, business development foundations and non-profit organizations such as SME representative organizations and sectorial associations. The cooperation with these stakeholders has a threefold purpose: 1. Complement existing services with additional services via the Network, integrated into the SME support environment; 2. Multiplicator effect. 3. Channel in professional stakeholders special expertise or sign-post the client in order that he can receive proper professional service in a certain field. Partners service portfolio within the Network is truly unique thanks to the concept that allows them to provide complex multidisciplinary services that cover each phase of internationalization and the innovation chain, thereby giving tailor-made support to SMEs adapted to the level of their development. Other regionally operating business development organizations provide a limited range of services in certain specific fields, while the consortium partners hold by the hand and lead companies, offering them integrated information, consultancy and partnering services in the areas of market entrance, innovation and R&D capacitybuilding, funding and cross-border partnering, providing the above services as a string of consecutive services. The consortium, while striving to avoid duplication of the services of other regional business development organizations, clearly wants to become an integrator for available business development services remaining an unavoidable player of the business development ecosystem. The EU dimension reinforced by the European Commission as background and the framework of international relationships, knowledge and instruments acquired under the previous Network significantly contribute to the uniqueness of these services compared to other existing services. Available business services in the field of internationalization and innovation in the geographic area covered by the Network Page 18 of 32

69 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Participation in local, regional and national strategy-making Chamber partners their national operation is coordinated by the Hungarian Chamber of Commerce and Industry and foundation partners members of the network of the Hungarian Business Development Foundation are regularly involved in the preparation and formulation of SME-related regional strategies due to their regional access to SMEs and their embedment, furthermore, they participate in the revision of national strategies through their representative bodies with national competence. HTD operating as part of the Hungarian National Trading House brand plays an active role in the formulation and revision of government strategies for SMEs. Strategic basis of the cooperation with stakeholders: Each partner prepared its own stakeholder mapping and analysis coordinated on a consortium level. Partners analysed every relevant regional and national stakeholder according to their services and special abilities, examined potential connection points with the Network s basic service areas and the activities where there already a cooperation with the stakeholder or should be estbalished (e.g. mutual information exchange, sign-posting, joint event organization, advisory services for stakeholder s clients, etc.). Partners marked certain organizations as premium stakeholders, e.g. several clusters, and developed individual, customized service packages for them. This kind of systematic approach and methodology allows consortium partners to get a comprehensive and organized view of those elements of their cooperation which can be strengthened in their existing stakeholder relationships, and to identify further organizations/areas for potential future cooperation. Moreover, stakeholder analysis is an excellent tool for strengthening the system of client sign-posting to the appropriate organizations. A Network Stakeholder Tool shall be placed on the website for major stakeholders (if not yet done), which will further reinforce the synergy between the various activities. Partners have confirmed the fact of cooperation in writing where necessary for ensuring an active cooperation. To further institutionalize cooperation with SME stakeholders based on the stakeholder mapping and analysis Page 19 of 32

70 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE performed by the consortium, a responsible person will be appointed to coordinate activities on a national level. This person will be responsible to organize meetings with SME stakeholders every six months to provide up-to date information on current EU-related issues, Commission initiatives and services, and upcoming activities of the Network in the region. The role and function of the Innovation Strategic Partners In order to further increase its dominance in the area of innovation services on national level, the consortium intends to channel in external capacities in addition to the internal capacities enhanced by the focused innovation services of the recently joined ATEKNEA Solutions. Partners conducted a thorough analysis of organizations that offer nationwide innovation services, and identified five key organizations with whom intensified strategic cooperation has been established. These organizations are the National Innovation Office, the Hungarian Association of Information Technology Companies (IVSZ):, Hungarian Intellectual Property Agency (HIPAvilon Nonprofit Ltd.), Bay Zoltán Nonprofit Ltd for Applied Research and IFKA Public Benefit Non-Profit Ltd for the Development of Industry. Cooperation with these players will enable the consortium to provide a unique range of services in the area of innovation in Hungary, and will also further strengthen the Network s role as a national integrator of such services. For a more detailed introduction of the innovation Strategic Partners please refer to Section 8. Strategy towards opportintities for SMEs in third countries In line with the Foreign Trade Strategy of the Hungarian Government and the efforts of the European Commission in this direction, co-operations facilitating entry into the markets of third countries is a clear priority for consortium partners. The primary objective of such co-operations is to enable Hungarian SMEs to tap into the economic growth of the dynamically developing regions of the world. In these countries Hungarian SMEs have the best chance to expand their exports in the traditional industries such as the food industry, food processing and the agricultural sector, as well as in the innovative, knowledge-based and technology-intensive sectors that produce significant added value. The consortium has established effective cooperation with several Network partners in third countries, and expects to start further co-operations and to deepen existing relationships under the new project period. In addition to Network partners, fruitful cooperation has been established with other business development organizations engaged in similar activities (MNKH Hungarian National Trading House Cls, bilateral chambers of commerce), and with some organizations founded by the Commission such as the EU SME Centre, the EU Japan Centre and the relevant IPR Helpdesks. In the next tender period the partners clear objective is to use their years of stable experience and provide assistance and mentoring to certain partner organizations in third countries that join the network, thereby also facilitating the international business partnerships of European, and within that the Hungarian SMEs in these target countries. 8. Methodology and justification for the proposed strategy (max. 10 pages) The Hungarian consortium provides its services to contribute to the development and sustainable growth of the SME sector in three key areas: 1. improvement of growth potential and international competitiveness 2. establishing and developing the cross-border relationships of SMEs in the Single Market and beyond 3. facilitating access to external funding and finance. The consortium provides fully integrated services at every stage of internationalisation and/or each phase of the innovation value chain from the development phase through to bringing the competitive and innovative product or service to the international market. The versatile organizational and professional background of host organizations, experienced and accomplished colleagues and the existing, wide-ranging and active relationships of partners ensure the practical implementation of the integrated service provision methodology. In order to achieve the objectives set out in the call, partners of the Hungarian consortium shall work as an integrated team, with a common understanding of their clients needs and internationalisation and innovation capacities and business strategies, and shall uphold extensive cooperation with other local and national SME support organizations and networks to be able to link their clients to regional innovation and business support services when required, thus realizing the No Wrong Door concept in practice. Rather than adopting a tool-driven quantitative approach, activities shall be output and impact driven, and focus on relevance of service provision, and on high quality standard professional services. With these principles ensured, the Network activities will still remain flexible enough to be able to adequately respond to SMEs needs according to changing circumstances in the economic environment, in technologies, markets and in ways of networking and doing business. 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71 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE In order to maximize the positive economic outcome and impact of the provided advisory and partnering services a constant follow-up and feedback mechanism is integrated into the service delivery process through which feedback is collected from the clients at different time intervals following service delivery. Ambitious but feasible targets have been set for the project that will benefit the SME sector on local and national level and strengthen the European economy, and thus contribute to reaching the objectives of the COSME programme and subsequently those set out in the Europe 2020 strategy. Implementation methodology of services and their relevance to SME needs and restraints In order to facilitate access for SMEs to the international markets and foster the development of internationally competitive and innovative companies consortium partners shall provide the following services in the context of the Enterprise Europe Network project: providing access to information on the internal market, EU legislation, and other EU subjects relevant to SMEs and advice and support services for internationalisation, innovation, technology transfer and participation in EU funded R&D programmes cross-border partnering services for business cooperation, technology transfer, innovation and research participation in SME feedback activities specific activities under Horizon 2020 enhancing the innovation management capacities of SMEs The main client base of the Network in Hungary shall be SMEs that have the potential and motivation to grow, extend their activities to the international market and find business partners abroad. Such target companies act like a catalyst in relation to other SMEs in their region, therefore the positive impact of the relevant services provided to them will be multiplied. Taking into consideration the economic realities in the East-Central Europe region, it will be an emphasized role of the Network to help SMEs build the capacities and provide advice required to engage in international partner cooperation and to better manage the innovation cycle. While the main target group of the Network services are SMEs in relation the R&D&I services universities, other higher education institutions and research institutes shall also be considered as clients. To ensure a wide outreach, services shall be provided to various SME support and SME representative organizations which also enable the Network to channel in the clients of these organizations into Network services. Young entrepreneurs, start-up companies and woman entrepreneurs are very important sub-groups of the SME community partners will be providing Network services tailored to these groups also to enhance and further develop the entrepreneurial environment. The special knowledge and expertise acquired in relevant Sector Groups and via the Cluster Contact Point provides an EU dimension for cluster development and internationalization of clusters. It is the clear intention of the consortium to uphold its position as a regional integrator of business development services, a truly one stop shop for SME needs. Sign-posting regime A consortium level and a stakeholder level sign-posting system hase been devised by the consortium. A fundamental instrument of the intelligent sign-posting method used by the consortium is a common Who Does What directory, which contains every expert on the Partner s staff, indicating their area of expertise and experience and the services they provide within the Network. The sign-posting system with the relevant professional stakeholders is based on the stakeholder mapping and analysis described in detail in Section 7 of the Implementation Strategy, and the organized management of active, bilateral stakeholder relations. I. Methodology for providing information, advisory and support services As explained in Section 2 of the Implementation Strategy, the main obstacle to the Hungarian SMEs access to international markets and successful innovation are the lack of adequate, up-to-date knowledge and information, and the lack of the necessary skills and capacities. Under this activity the consortium provides segmented services with a view to overcoming these deficiencies, adapted to the SMEs level of development, internationalization potential and innovation capacity. Methodology for providing information services All consortium partners shall be actively involved in all aspects of providing information services. For SMEs that are not mature enough in terms of internationalization or innovation ability to be able to truly benefit from the Network s partner search and tailor-made advisory services, the consortium partners ensure Page 21 of 32

72 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE access to information about EU subjects relevant to SMEs, response to contacts and participation in awareness-raising events. As concerns general information service, the primary objective is to convey information to the widest possible range of SMEs in a cost- and resource-effective manner. Online dissemination channels and consortiumlevel joint information service activities are particularly important. Partners focus on supplying specific information that is not directly or easily available for SMEs from other sources, and therefore can be easily distinguished from other similar services and represent added value for companies. The following topics will be covered: EU legislation relevant to SMEs, taxation, public procurement and standards, sectoral and market intelligence, open calls for proposals, access to EU funding and finance, information on co-operation on the Single Market, European Commission initiatives, and other information related to internationalization. #EUgolocal communication and communication on Horizon 2020 and COSME programmes shall be a priority. Tools for providing information services: A.) Online and automated information service tools and platforms: Central website: The central tool for disseminating useful information for SMEs is the national Enterprise Europe Network website ( The website is available both in Hungarian and English languages, and its main content elements are accessible also through RSS Feed service. Each partner has its own Network website section, which is available on the website of its own host organization. The Your Europe business portal is promoted by partners among their clients, and they adopt relevant content from there to strengthen synergies! Electronic newsletters: A general monthly electronic newsletter that is available via the central website. Every partner operates its own newsletter service for its clients on regional level. Certain professional consortium workgroups prepare periodic newsletters according to specific subjects or service areas! Customized information shall also be provided via direct, targeted s. Social media, smart phone and tablet application: Partners place great emphasis on their presence in social media (Facebook, Linked-In, YouTube, etc.): they run information campaigns and maintain two-way communication with their clients. Partners plan to develop a Network application for smart phones and tablets, which will be excellent for directly conveying information to certain target groups (e.g. young entrepreneurs, start-ups, managers of innovative companies). Customizable automated alert services and online assessment tools: Online automated tools provided by EASME (Query, Stakeholder), an EU tender alert service and an online innovation self-assessment tool shall be integrated into the central webpage. Partners all use the Query and Stakeholder tool on their respective webpages and heavily promote these online automated services. B.) News and information in printed and electronic media, preparing paper-based and electronic publications on subjects relating to internationalization, innovation and R&D. C.) Answer to queries from SMEs: answering service to , telephone or personal contacts from SMEs, or sign-posting if necessary, observing the Code of Conduct and the internal procedure of the consortium. With a view to time efficient service provision FAQs will be prepared based on frequently asked questions, which will be available on the central website. D.) Events: Organization of information sharing and awareness-raising events with the involvement of the relevant stakeholders, EU networks, the European Commission and the Hungarian Representation of the European Commission in Hungary. Joining EU campaigns. Several information sharing events are coorganized by the partners, working with each other and relevant stakeholders. As in the previous project period partners will actively participate in and promote European Commission campaigns in cooperation with the Representation of the European Commission in Hungary and also with other EU Networks (e.g.: SOLVIT, Europe Direct, EURES). Fewer events shall be organized than in the previous period, but they will be more focused and more integrated with other network services, addressing SMEs real needs; as a result, the consortium may channel the right clients into in-depth, customized advisory and partnering services. Methodology for providing advice and support services A uniform methodology has been devised for the advisory and support service delivery of the consortium with the aim of providing complex and integrated support to companies in improving their growth potential, meeting actual, identified corporate demands in the areas of market access, innovation and R&D capacity- Page 22 of 32

73 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE building, fundraising and building cross-border partnerships. Practice-oriented workshops and seminars help SMEs acquire the skills and competencies they need, and on the other hand, professional knowledge and experiences are transferred to enterprises as a kind of outsourcing within customized information and consultancy services. Companies may be involved into advisory and support services after a detailed company assessment and review, whereby their needs and the factors hindering their internationalization and innovation processes are identified. Partners provide advisory and support services in the following areas: 1. Internationalization and Market Access: All partners except ATEKNEA will be involved in providing advisory services related to market access and internationalization. The lead partners will be HTD and the 5 chambers of commerce partners. Amongst the barriers for successful internationalization the most common ones are lack of information on the internal market and target countries, applicable legislations and regulations, and insufficient management skills to plan and initiate cross-border business activities. Tailored to the identified specific needs and restraints of SMEs aiming to go international, the following methodologies and tools shall be utilized: Advisory services related to specific fields of internationalization and EU topics: business review, support enabling cross-border partnering inside and outside of the Single Market, support on EU legislation, policies, standards, tenders and public procurement, support for improving the management capacities of SMEs regarding export activities, support to already exporting companies to diversify in terms of export markets, products, buyers. Technology watch service: For key high-tech and knowledge-based sectors such as biotechnology, ICT, environment and health regular technology, market and competition watch will be provided to SMEs active in these sectors. Complex export skills trainings and capacity building: Intensive and complex training programmes to enhance the internationalization capacities of SMEs. The Network Ambassadors shall provide additional coaching based on their experience and success in internationalization activities. Facilitating market access for Hungarian SMEs: a.) Market access intelligence. Detailed, in-depth market intelligence and reports on target countries special legislations and sector specific information and the conditions of doing business shall be prepared with regard to markets within the Single Market, but more importantly for third country emerging markets relevant to Hungarian companies. b.) Market access trainings and individual advice: Preparatory events and advisory service focusing on third countries relevant to the export of SMEs, aiming to provide up-to-date country-specific information and preparing them for the particularities of the local business culture and intellectual property protection issues. Stakeholders: This range of advisory and other services is provided by the network in cooperation with national stakeholders such as the Hungarian Chamber of Commerce and Industry that coordinates regional chambers, the Carpathian Region Business Network Ltd., an organization facilitating the economic cooperation of the countries of the Carpathian Basin. Partners engage foreign and international organizations in the trainings and advisory services in addition to national stakeholders, and cooperate with Commission initiatives such as the EU SME Center, Japan EU Centre and some IPR Helpdesks. 2. In-depth advisory services on innovation: All partners except PRIMOM shall provide innovation support advisory services. The purpose of innovation services is to disseminate new knowledge and achievements and to facilitate their utilization in the area of research and technology, and to discover innovative SMEs and support their entrance to the international market. Consorium with its services shall aim to increase innovation awareness, faciliate technological renewel and foster the development of innovation potential and abilities in SMEs. The Hungarian Network facilitates the development of the domestic and international cooperation and network relations of SMEs and other innovation players, the cooperation between research centres, universities and companies, the utilization of R&D results and innovative technologies and the transnational technology transfer. Page 23 of 32

74 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Consortium partners shall use the following methodology and tools to achieve the objectives set out above: Innovation audit providing a complex innovation service package (from online tools to in-depth advisory service), assessment of the company s innovation capacities, operations and needs. The advisory service may lead to new innovations, participation in R&D/innovation tenders and internationally marketable technology offers and demands. The consortium supports not only product innovation but also service and process innovation and the launch of innovative business models through its services. Technology audit assessing the business or technological potential of a new, innovative product/service with a view to map as much innovative SMEs as possible (exporter, start-up companies, woman entrepreneurs, university spin-offs, focus sectors). Technology audits result in technological profiles that facilitate the international technology transfer. Personal advisory service innovation management, R&D and innovation partner search, technology transfer, participation in Horizon 2020 and other EU funded R+D projects, IPR. Special trainings intellectual property; innovation management from the idea to the product sectorspecific training, proposal writing for EU R+D projects. Facilitating the cooperation between universities and SMEs special activities (e.g. events, helping them get into international projects, innovation competitions, joint projects). Export promoting incubation activity Provided by some of the Hungarian consortium partners, this activity is key to the successful launch of knowledge- and technology-intensive innovative start-ups into the domestic and foreign markets. Support to start-up companies - trainings, mentoring, analysis/assessment of development suggestions, assessment of market maturity. Operating an innovation workgroup within the consortium to improve the staff s innovation competencies and knowledge, continuous training and information exchange, sharing good practices. Complex innovation service package with the involvement of other innovation stakeholders. Stakeholders: Partners cooperate with several stakeholders in providing innovation advisory services, but there are five key innovation organizations with national competence which were identified as Strategic Partners, and with whom the consortium established multi-level, focused and active cooperation and mutual sign-posting. The consortium can complement its own innovation capacities with unique and specialized innovation services, thereby is able to provide unrivalled complex services, supporting and developing technology transfer, SMEs R&D activity, the protection of intellectual property and every form of innovation, with a European dimension. Strategic Partners for innovation advisory services: - Bay Zoltán Nonprofit Ltd for Applied Research: Hungary's largest state owned institution of applied research, implementing various national and international research and development projects and bridging the gap between academia and the business sector. The company has research facilities in several locations in Hungary. - Hungarian Intellectual Property Agency (HIPAvilon Nonprofit Ltd.): State owned non-profit organization in which the rights of ownership are exercised by the Hungarian Intellectual Property Office; they also provide support services to innovative companies in the areas of Intellectual Property (IP) protection and exploitation and the management of their knowledge and intellectual capital. - Hungarian Association of Information Technology Companies (IVSZ): The key association representing Hungarian information technology companies with a special focus on start-up companies and start-up incubation. IVSZ provides highly professional innovation and business development services to SMEs via IT infrastructure audit and the development of companies. - IFKA Public Benefit Non-Profit Ltd for the Development of Industry: The organization has expertise in the fields of logistics, quality assurance and environmental protection and participates in the development of comprehensive domestic strategies. IFKA has a large pool of environmental innovation experts. - National Innovation Office (NIO): Governmental body responsible for research, development and technological innovation. NIO takes part in the development and implementation of national science, technology and innovation policy as well as in governmental information and analysis activities that support its implementation. The Hungarian National Contact Points are operated by the NIO. 3. Advisory and support services in the field of IPR All partners except ATEKNEA and PRIMOM will provide IP advisory services. Sufficient level of IPR awareness, and the conscious management of intellectual assets are essential to both engaging in successful business activities in foreign markets and also in transferring innovative technology on a transnational level. SMEs face resource and knowledge constraints to deal with IPR issues. To answer this problem, the Hungarian consortium partners provide a broad range of in-depth services to increase the capacity of SMEs in the field of intellectual property. The following methodology and tools will be implemented: Page 24 of 32

75 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Personal, customized IP advisory and support service, and channelling into the services of other professional organizations as necessary. The consortium provides support to SMEs through its services, ranging from the identification of intellectual properties through cost-effective protection solutions to business utilization and assignment by technology transfer, licence agreement or other forms of utilization. Organizing intense and practice-oriented workshops in IP management subject in order to build up adequate management capacities. Channelling the attendees of awareness-raising events into workshops and advisory service that offer concentrated knowledge transfer. Providing IP valuation service to support the innovation processes of SMEs with a business approach through an tool developed within the EU project IPorta. IP Audits will be carried out in conjunction with innovation and technology audits to provide a more comprehensive service. There was an active member from the Hungarian Network in both IPR Working Groups formed during the previous Network, who took part in the development of the Network IP service portfolio. To utilize the synergies between EU initiatives the consortium coordinator also has a dedicated EU IPR Helpdesk Ambassador. Stakeholders: Partners have an active, two-way cooperation including sign-posting and event co-organization with the Hungarian Intellectual Property Office and its regional info points, the intellectual property agency HIPAvilon Nonprofit Ltd. and the National Board Against Counterfeiting. On an international level the consortium also actively collaborates with EU projects providing highly professional IP services to SMEs. Such partners include IPR Helpdesks and the IPorta European network of national IP offices. 4. Methodology of providing services to facilitate access to EU funds and finance All partners except ATEKNEA shall be involved in access to finance services but ZMVA and PRIMOM shall take the lead based on their professional background and experience. Foundations and chamber of commerce partners as host organizations provide specific in-house financing activities. This expertise is also drawn on from within the consortium. A main obstacle to internationalization for SMEs is the lack of access to adequate funding. The Hungarian Network offers substantial support to clients on each step of the process of identifying and accessing financial instruments most suited for the company needs. Methodology and tools for providing advisory service in relation to access to EU funds and finance: Advisory service that covers both directly and indirectly financed, refundable and non-refundable EU funds, the raising of own resources for EU tenders, complemented by other locally and nationally available financial instruments. Special emphasis is placed on the financial instruments designed for SME financing under the Jeremie and Jasper programs and the European Investment Fund and within the COSME and Horizont 2020 framework programs. Matrix of the all available EU, national and regional financial schemes based on comprehensive mapping prepared by partners. Tender consultancy with regard to tender schemes devised under the operative development programs managed through the Structural Funds, which are co-financed by Hungary and are available for SMEs to support their market access and facilitate their R&D&I activity. Informing SMEs and start-ups with innovative project ideas about venture capital opportunities, investor readiness consultancy and training with a view to facilitating positive investment decisions. Stakeholders: Since the consortium strives to provide comprehensive services, it fosters excellent relationships with state and non-governmental organizations coordinating indirect EU tender resources and conducting supported borrowing activity, as well as with venture capital, private capital and other organizations engaged in resource mediation. There is national-level cooperation with the following partners: in the field of borrowing and tender resources the Hungarian Foundation for Enterprise Promotion (micro credit program), KAVOSZ Zrt., MAPI Hungarian Development Agency Corp. and the Széchenyi Programoffice, in the field of export crediting and insurance the Hungarian Export-Import Bank and the Hungarian Export Insurance Plc. overseen by the Ministry of National Economy, the Hungarian Development Bank, and in the field of supporting and funding start-ups and young, innovative enterprises the Young Entrepreneurs Association Hungray (FIVOSZ), the Hungarian Private Equity and Venture Capital Association (HVCA), and Venture Finance Hungary Plc, coordinator of the Jeremie programs. 5. Methodology of providing advisory services related to energy efficiency, eco-innovation and green entrepreneurship Page 25 of 32

76 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE All Partners except ATEKNEA shall provide such services. Cost-cutting due to the efficient use of energy and raw materials and the introduction of environmentally friendly technologies give clear competitive advantage to enterprises and ensure their long-term sustainable development. At the same time a significant portion of SMEs cannot switch to a more efficient and environmentally friendly operation on their own due to lack of the necessary knowledge and resources. It is a high priority for the consortium to create and strengthen sustainable businesses and to provide them with access to foreign markets. The consortium gives support to SMEs for their eco-conscious developments and innovations through related services and with the involvement of competent professional players, thereby also contributing to the achievement of EU objective of creating synergy between environmental protection and economic growth! Methodology and tools to foster energy and resource-efficient, environmentally friendly production in SMEs: in-house services with European dimension based on knowledge developed through participation in the relevant specific EU projects. operating regular forums and clubs where good practices are presented to attendees, who may learn from experts and each other as well. connecting SMEs to professional service providers to allow them to benefit from a more complete range of services in this area. Partners build their services in the field of green entrepreneurship on experiences gained in several relevant international projects. Stakeholders: The EU dimension of services is also ensured through a number of connections with the European Institute of Innovation and Technology (EIT). Local and national pool of experts and also stakeholders such as the Foundation for Small Enterprise Economic Development (SEED) with expertise in sustainable and responsible business development; KSZGYSZ as a national association of environmental enterprises; KÖVET Association for Sustainable Economies; faculties of divers universities in the field (e.g. Szent István, Óbudai). II. Methodology for providing cross-border partnering services All partners except ATEKNEA shall be actively involved in both key services provided under partnering partner search profiles and transnational matchmaking events. ATEKNEA shall only be involved in technology transfer partner search through profiles. A cornerstone of the Hungarian Network services is cross-border partnering, which was successfully used already during the previous project to support SMEs in going international and establishing transnational relationships. Even SMEs that possess adequate capacities and management skills face a great challenge when they have to identify the right business partners and build up relationships during the introduction of their competitive, innovative products and technologies to foreign markets. This is where the consortium can offer them efficient assistance through the Network s cross-border partnering services. Priorities within the Single Market Within the Single Market consortium partners place emphasis on both the traditional, large European markets of Hungarian companies and on boosting their economic cooperation with the neighbouring countries. The region of the Carpathian Basin may become a new key economic centre of the European Union in the next decades, and a majority of Hungarian SMEs considers these countries as the first natural step of their export activity. The consortium fosters special relationships with the business development organizations of the neighbouring countries, particularly with the local Network partners. The CEENet7 platform of which the Hungarian consortium is an active member is the result of the close cooperation between the Network partners of the Central European economic region. The founders are eight regions (Network consortia) from seven countries in the Central Europe Region: Austria, Czech Republic, Germany (Saxony, Saxony-Anhalt), Hungary, Poland (West Poland), Slovenia and Slovakia. The aim of the platform is an intensified cooperation with the mutual objective of strengthening economic relations in the regions involved through fostering partnerships between their respective SMEs. Partnering activities with third countries In line with the Strategy of Opening to the East of the Hungarian Government and with the efforts of the European Commission in this direction, when developing our future service portfolio we shall put even more emphasis on the development of Hungarian SMEs international business relationships in growth areas outside Europe, and on supporting long-term partnerships with companies operating in the Far East, in the Arab countries, Latin America, North Africa, CIS and the Balkan countries, in active cooperation with the Network partners of these countries. Page 26 of 32

77 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE The consortium partners intensively support Mission for Growth events, organized by the European Commission in the developing economic regions of the world. As regards the target countries for Hungarian SMEs, consortium partners conduct synchronized nationwide joint promotion to recruit suitable companies for such Mission for Growth events in the future. The Hungarian consortium provides cross-border partnering services within a well-defined delivery process that includes several elements from the assessment of partner demands through preparing and promoting partnership profiles, (co)organizing matchmaking events and managing expressions of interest to the support for discussions with potential partners and the conclusion of contracts. Coordination of partnering activities on a consortium level In order to increase the output and impact of this activity and the follow-up process on a consortium level partners have established a closer coordination via the working group on cross-border cooperation. The internal working group on innovation will focus on constantly improving technology-transfer and R&D partnering services via disseminating professional knowledge and good practices within the consortium. Utilizing the partnership opportunity database to facilitate cross-border partnering The consortium shall take a qualitative approach towards the generation and effective distribution of business cooperation, technology offer and request and research partner request profiles as high quality, well written profiles attracts more expressions of interests from foreign companies and result in a higher number of transnational cooperation. The internal review system of the consortium, designed by the Hungarian partners, ensures that partner profiles uploaded into the database represent a constant high quality. The professional forum, comprising of the partners internal reviewers, elaborated a common procedure for preparing profiles and conducting reviews at the consortium, and the relevant compliance requirements ensure the high quality of the profiles prepared. Clients will receive tailor-made assistance in order to identify the most suitable profile type for their needs and to develop the most relevant partnership proposal(s). Trainings shall also be organized with a focus on training clients how to use the partnership opportunity database and partner search services of the Network to their benefit effectively. In order to ensure easy accessibility to the online partnering database partners actively utilize and promote the specific alerting services such as the Autamated Alert Tool and the Stakeholder Tool made available by the EASME. The online search facility for events and profiles is embedded not only in the country website but also in each partner s website. Brokerage Events and Company Missions To facilitate commercial cooperation, transnational technology transfer and research cooperation with foreign partners, transnational brokerage events and company missions will be (co-)organized in Hungary and abroad where partner s clients will have the opportunity to personally meet potential partners from Europe and outside of Europe. In the previous project period consortium partners have acquired substantial experience in organizing and coorganizing high quality partnering events that meet the standards of the Network. Because of the few existing high quality trade fairs at national level, the consortium s strategy is to take a high number of clients abroad to brokerage events accompanying large, well established foreign trade fairs and for Hungary to organize highly focused, sector or subsector specific matchmaking next to conferences and smaller or standalone B2B events with fewer participants and carefully selected profiles. Transnational technology brokerage and Horizon 2020 R&D project partnering events shall constitute a substantial part of the consortium s partnering activities. R&D project partner search events are a highly successful tool in helping companies find project consortium partners. To ensure professional service delivery an online matchmaking tool shall be utilized at events where a large number of clients will participate. While respecting the traditional methods in order to meet the changing needs of clients, partners shall also utilize innovative and effective new methods, such as mirroring events with another Network partner, buyers forum, cluster2cluster events and on-line B2B events for a cost effective and time saving way for clients to have meetings with potential partners. Page 27 of 32

78 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE A small group of carefully pre-selected companies engaged in transnational meetings are very effective especially for specific sectors and areas therefore, partners shall put emphasis on organizing such sector focused company missions both incoming and outbound. Combining brokerage events with practice oriented company and project visits constitute added-value and generate great interest from clients, therefore, this shall be further utilized during inland B2Bs. Partners participate in the Sector Groups that are relevant for the clients of their region and actively recruit clients for the events supported by the Sector Groups, they also organize such events themselves. To help clients reach concrete results and make an impact via matchmaking events intensive periodic followup activities will be carried out after the events. III. Methodology for SME Feedback activities All partners will be involved in this activity The Network is a unique tool in the hands of the European Commission, which enables it to directly reach SMEs on the ground. To channel in the voice of companies, the consortium shall collect feedback from SMEs on existing EU legislation, collect the opinions of SMEs on EU policies and upcoming legislation via business panels, online questionnaires and shall promote public consultations of the European Union. The results of such consultations and panels shall be communicated to the participating clients and also to the wider audience through the webpage and newsletter. Two partners, CSMKIK and FMKIK have appointed SME Feedback Contact Persons in the previous Network period, and they will continue to coordinate such activities. Partners will closely cooperate with and make referrals to SOLVIT Network, European Business Test Panel. Questionnaires are translated at consortium level, and then an online questionnaire is prepared, which will be jointly promoted by the partners at national level and also individually at local level. The Consortium shall utilize its proximity to SMEs, large client base and also its excellent partnerships with the relevant stakeholders: associations, other SME representative organizations, ministries, state and local authorities as multipliers to obtain feedback from a large pool of SMEs. Relevant previous projects and activities supporting the delivery of Network services The fact that eight partners were already members of the internationally successful Hungarian Network in the previous period has a huge impact on the accomplishment of project goals. This means that the consortium is aware of the actual expectations from the very beginning of the project, and is able to start effective implementation immediately, without any induction period. High-quality results and activity-guided service provision are guaranteed since in the previous project period the consortium has successfully introduced the Network brand, the host organizations and the Network s staff have acquired the necessary knowledge and experience, and the partners managed to build up wide-ranging international and regional partnership relations both at organizational and personal level. The majority of the former consortium partners were members of EIC, the Network s predecessor. Moreover, partners participated and participate in several national and international business development and innovation related projects, thereby acquiring knowledge and skills that will contribute to the professional background of services. A few examples of partners relevant projects; the list is indicative only and non-exhaustive: HTD Senior Network Staff has managed a high number of relevant projects within the former coordinator organization: for eg. Erasmus for Young Entrepreneurs, T4SME: tendering for SMEs, ADC: transnational cluster cooperation for business development, BE2WEEN: organizing international b2b events in renewable energy, and environmental sector, Danube-Pie: product innovation through eco-design. ATEKNEA: participated in 17 projects in the FP6 framework program while in 45 projects were funded by FP7 program. Most of these projects were supported in the Research for the Benefit of SMEs and SME Associations calls, but also included STREP (FP6), Collaborative (FP7), EUROSTARS and other programs. ATEKNEA is the most successful private organization in FP7 funded projects in Hungary. FMKIK: MEC_ : Use of renewable energy sources, best practise, B2B and international conference, KEOP-6.2.0/B/ : Pilot project on sustaniable energy and opportunities, NGM _SZERZ68/1/ 2012/2/2/Fejér: Support of development of foreign economic relations, business opportunities, supplier relationships, investments. Page 28 of 32

79 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE GYMSKIK: centrope_tt: cross-border technology transfer and innovation support between enterprises and universities in the Centrope region, OPTICOM: optimising cross-border business via IT technology, STEEEP: effective energy management for SMEs, Ready for Equity 2: access to early stage financing. ZMVA: ID:WOOD: Clustering Knowledge, Innovation and Design in the SEE Wood Sector, DIFASS: facilitates access to finance for SMEs by exchanging innovative business support measures. PBKIK: INTRA: export training process for SME s, EVLIA: Leveraging intellectual assets for financing SMEs in South East Europe, InnoWeit: Transferring 'InnoKenn' innovation capability diagnostic tool from Germany, CNCB - Cluster and Network Cooperation for Business Success in Central Europe. HBKIK: DMCE: Development of management capabilities of SMEs cross-border activities, PROINCOR: Proactive Innovation Support for SMEs in the corridor from the Baltic to the Mediterranean; CBBCN: crossborder cooperation between business networks in Bihor and Hajdu-Bihar counties. PRIMOM: TACIS: expert partner in cross-border cooperation aimed at setting up an incubator in Ukraine, Romanian-Hungarian Cross-border Business Development Programme. CSMKIK: EEN-PACT: Services for SMEs in the field of environment through the Enterprise Europe Network, Clusters without borders: clustering opportunities of SMEs in the Hungarian-Romanian cross border, HU-SRB cross border projects in topics of cluster cooperation and export development. Strategy, methodologies and tools in relation to activities of the Network under Horizon 2020 Horizon 2020 activities of the Network will target innovative SMEs with real potential to grow and build up international presence with their innovative products/services. The Key Account Management services shall target SMEs already having successful involvement in the SME Instrument. Their main needs and requirements therefore are to get credible guidance and coaching how to use the opportunity and funding gained in SME Instrument to successfully and smoothly implement their innovation project and build it into the further strategy of company development. The typical Hungarian SME interested in SME Instrument is a company between employees. Specific needs identified by ATEKNEA that cooperated with more than 100 SMEs in implemented SME focused EU programmes: Credible information and guidance about the detailed road map of an SME Instrument project. Guidance and support in negotiations and contracting with the EU offices and the partners involved in the project Guidance and coaching to handle risks and opportunities during the project implementation (both Phase 1 and Phase 2). Credible tutorial and coaching on project administration Professional coaching and consultancy on the business opportunity derived from the project. company assessment and company development consultancy to be able to handle the increasing workload and/or business activities generated by the project results. Technological coaching and risk assessment for innovation projects where the idea owner is more business oriented than technology based. A reliable contact point to get advice or coaching in case a problem or question arises. The Network will ensure the access to necessary knowledge and information for the target group by offering skilled and experienced Key Account Managers to consult the issues and topics raised. The appointed KAM will use a specified methodology to adequately assess the SME needs to successfuly implement the project awarded grant under the SME Instrument and to faciliate the effective involvement of a coach with extensive expertise in the field where SME requires assistance to bring its product to the market. The methodology will be elaborated and standardized by experts of the Network based on known innovation management tools that will be tailored to the real needs of the given target group. KAM services will be project oriented but the characteristics of the beneficiary will also be evaluated and assessed. Enhancing innovation management capacities of SMEs target a group of companies that are not aware or not convinced about the opportunity in EU funded innovation programmes. For them the credible and comprehensive information is the key necessity. They need personal contact with parties having vast experience Page 29 of 32

80 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE either from EU perspective or as SME participant of such a program. The Network with the leadership of ATEKNEA will offer this knowledge and experience. Targeted SMEs also need guidance and coaching to introduce them into the proposal system. Specific needs identified: Innovation capacity assessment (concept generation, concept validation, innovation management capacities) Implementation capacity assessment (product development, human resources, management resources, equipment and other resources, timeframe, etc.) Comprehensive innovation strategy assessment. (objectives, cost-benefit analysis and requirements, return of investment requirements) Innovation process gap analsys (resources, processes) Enhancing innovation management capacities of SMEs service offered by the Network therefore will be more strategic and company based to be able to highlight any opportunity and weakness of the company in improving its innovation processes and potential. The Network will use specified and tailored innovation management methodology to evaluate and improve the innovation potential of the target group. The Network will create, maintain and offer consultancy capacities of experienced innovation managers, based on the human resources and professional background in innovation management of the Network members. 9. Quality principles, internal implementation and control (max. 2 pages) Consortium partners will strive to constantly raise the quality of services delivered to SMEs within the Network as this is key to achieving a significant impact. The consortium has already acquired significant experiences in this field in the previous Network period, and wishes to build on these experiences in the future to provide the best possible support for the development of SMEs competitiveness through its services, thereby facilitating sustainable growth. The consortium aims to ensure high quality standards through the combined use of various tools. Each host organization is strongly committed to delivering high quality services and to the successful project implementation, and are ready to ensure the necessary conditions. Several consortium partners operate quality assurance systems (e.g. ISO), whereby they have gained considerable experience in the field of quality management. This knowledge is integrated and shared at consortium level. Each partner will deliver well defined services and products within the Network with a standard process for delivery of each defined product and service. Partners enforce uniform high standards for the Network staff. Each service shall be provided only by customer-oriented (company facing) persons with business development background and relevant experience and a high commitment to the project. The majority of the project staff are senior colleagues with an extensive track record of working with upper management of SMEs. Quality management through organizational build-up In order to provide standardized services quality management related activity is closely coordinated at consortium level. The foundations of such coordination are laid down in the provisions of the Consortium Agreement, which set up the consortium s organization and stipulate the partners obligations to provide professional services and with regard to the internal progress reports and those to be submitted to EASME. Quality control and improving functions of internal consortium groups. The National Meeting, attended by the host managers and the Network office managers is the general decision-making body of the consortium. One of its fundamental roles is to ensure and control at a strategic level that the project shall be implemented in high quality, and that the services provided shall be professional. As part of its relevant duties it gives recommendations, prepares action plans and gives support to certain partners if necessary. The Network office managers have regular teleconferences, thereby coordinating activities at operational level in order to harmonize and standardize the Network activities. Each partner is deeply interested in that all partners shall provide equally high quality services because any consortium is just as strong as its weakest partner. The regular working groups (innovation, communication, cross-border cooperation, financial) play a significant role in developing uniform standards in their own areas of expertise and in improving service quality at consortium level through knowledge dissemination. Also there exists a group consisting of the partners internal profile reviewers who are responsible for ensuring the high quality of partnership profiles. Page 30 of 32

81 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE Consortium partners fully observe not only the internal rules of procedure issued by the Commission and EASME for the Network but also the consortium guidelines and policies prepared by the above bodies and approved and enforced by the National Meeting. These consortium-level documents, which are mandatory for each partner, further reinforce the application of the No-Wrong Door principle.htd, as coordinator is responsible for ensuring compliance with the mandatory requirements and regulations within the project. Monitoring of progress and quality, agency and internal reports: Consortium partners set ambitious but achievable targets for indicators within the projects, taking into account the company s needs, their own strength, resources and experiences. As impact driven service delivery is at the core of our strategy, instead of a quantitative approach emphasis shall be put on the outcome indicators rather than the tool indicators. Same amount of services when provided by a high standard have a bigger positive impact and result in more outcome indicators. Based on the legal principles laid down in the Consortium Agreement the partners are obliged to regularly (at least every six months and further on a need to have basis) provide internal financial and technical progress reports to the coordinator. It is the duty of the coordinator to analyse and syntethize the reports and present it to the National Meeting. The outcome of the report is evaluated on the next National Meeting where possible risks are identified. This process allows for the constant monitoring and standardization of the performance of the partners and should a lag be identified in any field of activity quick corrective action can be taken. For any partner facing difficulty in meeting the time-proportionate targets and objectives of the project a personalized action plan is prepared with the aid of the coordinator and will also receive active support from other partners. To ensure that the consortium partners contribute to realizing a Network of Excellence and that the network effect is clearly tangible additional performance indicators not mandatory in the project are also monitored, such as the ratio of partnership agreements where two Network partners were involved compared to the total number of partnership agreements. The consortium shall also use benchmarking based on other consortiums performance that are comparable to those of the Hungarians with regards to economical background of the covered regions, needs and constraints, total FTE of staff, etc. Such benchmarking will ensure that the consortium has a clear view of its performance within the context of thr Network. The required data to perform the benchmarking shall be collected from EASME channels such as results of benefit surveys and summary reports on performance of Network consortiums and results achieved in various performance indicators with a focus on outcome, achiements and impact and also from exchange of information with other consortiums especially with members of the CEENet platform and other informal information exchange. This close coordination process has already resulted in a very strong and cooperative consortium in the previous project period which exceeded the relevant outcome targets. By signing the updated Consortium Agreement such activities and obligations are also mandatory for the new partner. Should a partner substantially underperform even after receiving notification of this from their coordinator, and being provided with a tailored mentoring and action plan EASME will be contacted and underperforming partners shall be requested to participate in the ad-hoc assistance scheme. All reporting and self-assessment activities required by the EASME under the project shall also be closely coordinated by HTD. Before the submission of reporting documents, the coordinator performs a quality check to confirm that all information and values are coherent. If any doubt arises the coordinator contacts the relevant partners and clarifies inconsistencies, corrects the report if necessary. Project management tool Based on the experience of the consortium in order to be able to track progress and record adequate and valid data on services rendered and their impact it is essential to utilize a project management tool. The specific online tool that will continue to be used by partners is able to capture both quantitative and qualitative aspects of the performance indicators and results. The management tool allows partners to check the status of output and outcome indicators but more importantly a consortium level progress can be tracked via this tool providing the basis for reports to the agency and for the purpose of internal monitoring and evaluation. Comprehensive training concept for continuous quality improvement Having regard to the fact that the continuous development of the staff s professional knowledge and skills is an important means of improvement of service quality, the consortium wishes to ensure that by a multi-level training concept. Partners regularly organize internal trainings for their own Network staff. Moreover, consortium partners organize training for each other in specific professional areas where they have outstanding experience. Staff-exchanges are also quite frequent within the consortium in order that employees may deepen their knowledge in a certain field through the support of their colleagues working in similar areas. Relevant professional stakeholders are often involved in the trainings, thereby partners bring external knowledge into the consortium. Foreign staff exchange is encouraged at consortium level, as well as participation on decentralized trainings and the central trainings of the EASME. Page 31 of 32

82 COSME ENTERPRISE EUROPE NETWORK IMPLEMENTATION STRATEGY HCE The annual All Staff Training is a traditional good practice the partners wish to continue. Partners aim with organizing an All Staff Training annually is to strengthen the cooperation within the Hungarian Network via networking, and to disseminate good practices within the consortium, provide trainings and workshops on relevant EU and Network topics to colleagues and in general to further improve the efficiency of the consortium. Adhering to the rules of the Code of Conduct In the previous project period the Hungarian consortium was one amongst the first ones to have all its partners adopt the Code of Conduct. This joint adoption provided the basis for establishing an internal quality control system based on the provisions of the Code of Conduct. So called Guards of the Code were selected who are responsible for ensuring that all staff members at each partner are aware of and understand the rules and regulations set out in the Code and that they adhere to them in their everyday activities. The Guards are responsible for providing trainings to newcomers and for devising practical methodologies and good practices on how to effectively adhere to the Code. Partners intend to further elaborate this internal quality assurance system based on the experience gained in the previous project period. Page 32 of 32

83 Framework Partnership Agreement number: HCE COS-EEN ANNEX 3 ACCESSION FORM FOR PARTNERS ATEKNEA SOLUTIONS HUNGARY KFT (ATEKNEA) KFT, , established in TETENYI UT 84-86, BUDAPEST 1119, Hungary, HU , ('the partner'), represented for the purpose of signing this Accession Form by the undersigned, to become partner ( 2 ) hereby agrees in Framework Partnership Agreement No ( the Framework Partnership Agreement ) between Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag and the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), the coordinator and mandates - to submit any proposals for the award of Specific Grants; - to sign in its name and on its behalf all the Specific Agreements that may be awarded (see Articles 2 and 55); - to submit and sign in its name and on its behalf any amendments to the Framework Partnership Agreement and Specific Agreements (see Article 54). By signing this Accession Form, the partner accepts the partnership and agrees to implement the partnership and the specific grants in accordance with the Framework Partnership Agreement and the Specific Agreements, with all the obligations and conditions they set out. SIGNATURE For the partner: [--TGSMark#signature _75_210--] 1

84 Framework Partnership Agreement number: HCE COS-EEN ANNEX 3 ACCESSION FORM FOR PARTNERS FEJER MEGYEI KERESKEDELMI ES IPARKAMARA (FMKIK), /1062, established in HOSSZUSETATER 4-6, SZEKESFEHERVAR 8000, Hungary, HU , ('the partner'), represented for the purpose of signing this Accession Form by the undersigned, to become partner ( 3 ) hereby agrees in Framework Partnership Agreement No ( the Framework Partnership Agreement ) between Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag and the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), the coordinator and mandates - to submit any proposals for the award of Specific Grants; - to sign in its name and on its behalf all the Specific Agreements that may be awarded (see Articles 2 and 55); - to submit and sign in its name and on its behalf any amendments to the Framework Partnership Agreement and Specific Agreements (see Article 54). By signing this Accession Form, the partner accepts the partnership and agrees to implement the partnership and the specific grants in accordance with the Framework Partnership Agreement and the Specific Agreements, with all the obligations and conditions they set out. SIGNATURE For the partner: [--TGSMark#signature _75_210--] 2

85 Framework Partnership Agreement number: HCE COS-EEN ANNEX 3 ACCESSION FORM FOR PARTNERS GYOR-MOSON-SOPRON MEGYEI KERESKEDELMI ES IPARKAMARA (Győr-Moson- Sopron Megyei Kereskedelmi és Iparkamara), /1355, established in SZENT ISTVAN U 10A, GYOR 9021, Hungary, HU , ('the partner'), represented for the purpose of signing this Accession Form by the undersigned, to become partner ( 4 ) hereby agrees in Framework Partnership Agreement No ( the Framework Partnership Agreement ) between Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag and the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), the coordinator and mandates - to submit any proposals for the award of Specific Grants; - to sign in its name and on its behalf all the Specific Agreements that may be awarded (see Articles 2 and 55); - to submit and sign in its name and on its behalf any amendments to the Framework Partnership Agreement and Specific Agreements (see Article 54). By signing this Accession Form, the partner accepts the partnership and agrees to implement the partnership and the specific grants in accordance with the Framework Partnership Agreement and the Specific Agreements, with all the obligations and conditions they set out. SIGNATURE For the partner: [--TGSMark#signature _75_210--] 3

86 Framework Partnership Agreement number: HCE COS-EEN ANNEX 3 ACCESSION FORM FOR PARTNERS ZALA MEGYEI VALLALKOZASFEJLESZTESI ALAPITVANY (ZMVA) HU6, 60042, established in Koztarsasaag ut. 17 Pf 116, ZALAEGERSZEG 8900, Hungary, HU , ('the partner'), represented for the purpose of signing this Accession Form by the undersigned, to become partner ( 5 ) hereby agrees in Framework Partnership Agreement No ( the Framework Partnership Agreement ) between Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag and the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), the coordinator and mandates - to submit any proposals for the award of Specific Grants; - to sign in its name and on its behalf all the Specific Agreements that may be awarded (see Articles 2 and 55); - to submit and sign in its name and on its behalf any amendments to the Framework Partnership Agreement and Specific Agreements (see Article 54). By signing this Accession Form, the partner accepts the partnership and agrees to implement the partnership and the specific grants in accordance with the Framework Partnership Agreement and the Specific Agreements, with all the obligations and conditions they set out. SIGNATURE For the partner: [--TGSMark#signature _75_210--] 4

87 Framework Partnership Agreement number: HCE COS-EEN ANNEX 3 ACCESSION FORM FOR PARTNERS PECS-BARANYAI KERESKEDELMI ES IPARKAMARA (PECS-BARANYAI KERESKEDELMI ES IPARKAMARA), 1216, established in MAJOROSSY IMRE U 36, PECS 7625, Hungary, HU , ('the partner'), represented for the purpose of signing this Accession Form by the undersigned, to become partner ( 6 ) hereby agrees in Framework Partnership Agreement No ( the Framework Partnership Agreement ) between Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag and the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), the coordinator and mandates - to submit any proposals for the award of Specific Grants; - to sign in its name and on its behalf all the Specific Agreements that may be awarded (see Articles 2 and 55); - to submit and sign in its name and on its behalf any amendments to the Framework Partnership Agreement and Specific Agreements (see Article 54). By signing this Accession Form, the partner accepts the partnership and agrees to implement the partnership and the specific grants in accordance with the Framework Partnership Agreement and the Specific Agreements, with all the obligations and conditions they set out. SIGNATURE For the partner: [--TGSMark#signature _75_210--] 5

88 Framework Partnership Agreement number: HCE COS-EEN ANNEX 3 ACCESSION FORM FOR PARTNERS HAJDU-BIHAR MEGYEI KERESKEDELMI ES IPARKAMARA (HAJDU-BIHAR MEGYEI KERESKEDELMI ES IPARKAMARA), , established in PETOFI TER 10, DEBRECEN 4025, Hungary, HU , ('the partner'), represented for the purpose of signing this Accession Form by the undersigned, to become partner ( 7 ) hereby agrees in Framework Partnership Agreement No ( the Framework Partnership Agreement ) between Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag and the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), the coordinator and mandates - to submit any proposals for the award of Specific Grants; - to sign in its name and on its behalf all the Specific Agreements that may be awarded (see Articles 2 and 55); - to submit and sign in its name and on its behalf any amendments to the Framework Partnership Agreement and Specific Agreements (see Article 54). By signing this Accession Form, the partner accepts the partnership and agrees to implement the partnership and the specific grants in accordance with the Framework Partnership Agreement and the Specific Agreements, with all the obligations and conditions they set out. SIGNATURE For the partner: [--TGSMark#signature _75_210--] 6

89 Framework Partnership Agreement number: HCE COS-EEN ANNEX 3 ACCESSION FORM FOR PARTNERS PRIMOM FOUNDATION FOR ENTERPRISE PROMOTION OF SZABOLCS SZATMAR BEREG COUNTY BT (PRIMOM SZABOLCS-SZATMAR-BEREG MEGYEI VALLALKOZASELENKITO ALAPITVANY) HU6, /28, established in VACI MIHALY STREET 41, NYIREGYHAZA 4400, Hungary, ('the partner'), represented for the purpose of signing this Accession Form by the undersigned, to become partner ( 8 ) hereby agrees in Framework Partnership Agreement No ( the Framework Partnership Agreement ) between Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag and the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), the coordinator and mandates - to submit any proposals for the award of Specific Grants; - to sign in its name and on its behalf all the Specific Agreements that may be awarded (see Articles 2 and 55); - to submit and sign in its name and on its behalf any amendments to the Framework Partnership Agreement and Specific Agreements (see Article 54). By signing this Accession Form, the partner accepts the partnership and agrees to implement the partnership and the specific grants in accordance with the Framework Partnership Agreement and the Specific Agreements, with all the obligations and conditions they set out. SIGNATURE For the partner: [--TGSMark#signature _75_210--] 7

90 Framework Partnership Agreement number: HCE COS-EEN ANNEX 3 ACCESSION FORM FOR PARTNERS CSONGRAD MEGYEI KERESKEDELMI ES IPARKAMARA (CSMKIK), , established in PARIZSI KRT 8-12, SZEGED 6721, Hungary, HU , ('the partner'), represented for the purpose of signing this Accession Form by the undersigned, to become partner ( 9 ) hereby agrees in Framework Partnership Agreement No ( the Framework Partnership Agreement ) between Magyar Kereskedelem-fejlesztesi es Promocios Korlatolt Felelossegu Tarsasag and the Executive Agency for Small and Medium-sized Enterprises (EASME) ('the Agency'), under the power delegated by the European Commission ('the Commission'), the coordinator and mandates - to submit any proposals for the award of Specific Grants; - to sign in its name and on its behalf all the Specific Agreements that may be awarded (see Articles 2 and 55); - to submit and sign in its name and on its behalf any amendments to the Framework Partnership Agreement and Specific Agreements (see Article 54). By signing this Accession Form, the partner accepts the partnership and agrees to implement the partnership and the specific grants in accordance with the Framework Partnership Agreement and the Specific Agreements, with all the obligations and conditions they set out. SIGNATURE For the partner: [--TGSMark#signature _75_210--] 8

91 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 ANNEX 4 MODEL FOR THE CERTIFICATE ON THE METHODOLOGY For options [in italics in square brackets]: choose the applicable option. Options not chosen should be deleted. For fields in [grey in square brackets]: enter the appropriate data. TABLE OF CONTENTS TERMS OF REFERENCE FOR AN AUDIT ENGAGEMENT FOR A METHODOLOGY CERTIFICATE IN CONNECTION WITH ONE OR MORE GRANT AGREEMENTS FINANCED UNDER THE HORIZON 2020 RESEARCH AND INNOVATION FRAMEWORK PROGRAMME 1 INDEPENDENT REPORT OF FACTUAL FINDINGS ON THE METHODOLOGY CONCERNING GRANT AGREEMENTS FINANCED UNDER THE HORIZON 2020 RESEARCH AND INNOVATION FRAMEWORK PROGRAMME.. 7

92 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Terms of reference for an audit engagement for a methodology certificate in connection with one or more grant agreements financed under the Horizon 2020 Research and Innovation Framework Programme This document sets out the Terms of Reference (ToR) under which [OPTION 1: [insert name of the partner] ( the Partner)] [OPTION 2: [insert name of the linked third party] ( the Linked Third Party ), third party linked to the Partner [insert name of the partner] ( the Partner )] agrees to engage [insert legal name of the auditor] ( the Auditor ) to produce an independent report of factual findings ( the Report ) concerning the [Partner s] [Linked Third Party s] usual accounting practices for calculating and claiming direct personnel costs declared as unit costs ( the Methodology ) in connection with grant agreements financed under the Horizon 2020 Research and Innovation Framework Programme. The procedures to be carried out for the assessment of the methodology will be based on the grant agreement(s) detailed below: [title and number of the grant agreement(s)] ( the Agreement(s) ) The Agreement(s) has(have) been concluded between the Partner and Executive Agency for Small and Medium-sized Enterprises (EASME) ( the Agency ), under the powers delegated by the European Commission ( the Commission ). The Agency is mentioned as a signatory of the Agreement with the Partner only. The Agency is not a party to this engagement.

93 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September Subject of the engagement According to Article 24 of the Framework Partnership Agreement, partners [and linked third parties] that declare direct personnel costs as unit costs calculated in accordance with their usual cost accounting practices may submit to the Agency, for approval, a certificate on the methodology ( CoMUC ) stating that there are adequate records and documentation to prove that their cost accounting practices used comply with the conditions set out in Point A of Article 5.2 of the Specific Agreement. The subject of this engagement is the CoMUC which is composed of two separate documents: - the Terms of Reference ( the ToR ) to be signed by the [ Partner] [Linked Third Party] and the Auditor; - the Auditor s Independent Report of Factual Findings ( the Report ) issued on the Auditor s letterhead, dated, stamped and signed by the Auditor which includes; the standard statements ( the Statements ) evaluated and signed by the [Partner] [Linked Third Party], the agreed-upon procedures ( the Procedures ) performed by the Auditor and the standard factual findings ( the Findings ) assessed by the Auditor. The Statements, Procedures and Findings are summarised in the table that forms part of the Report. The information provided through the Statements, the Procedures and the Findings will enable the Commission to draw conclusions regarding the existence of the [Partner s] [Linked Third Party s] usual cost accounting practice and its suitability to ensure that direct personnel costs claimed on that basis comply with the provisions of the Agreement. The Commission draws its own conclusions from the Report and any additional information it may require. 1.2 Responsibilities The parties to this agreement are the [Partner] [Linked Third Party] and the Auditor.

94 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 The [Partner] [Linked Third Party]: is responsible for preparing financial statements for the Agreement(s) ( the Financial Statements ) in compliance with those Agreements; is responsible for providing the Financial Statement(s) to the Auditor and enabling the Auditor to reconcile them with the [Partner s] [Linked Third Party s] accounting and bookkeeping system and the underlying accounts and records. The Financial Statement(s) will be used as a basis for the procedures which the Auditor will carry out under this ToR; is responsible for its Methodology and liable for the accuracy of the Financial Statement(s); is responsible for endorsing or refuting the Statements indicated under the heading Statements to be made by the Partner / Linked Third Party in the first column of the table that forms part of the Report; must provide the Auditor with a signed and dated representation letter; accepts that the ability of the Auditor to carry out the Procedures effectively depends upon the [Partner] [Linked Third Party] providing full and free access to the [Partner] [Linked Third Party s] staff and to its accounting and other relevant records. The Auditor: [Option 1 by default: is qualified to carry out statutory audits of accounting documents in accordance with Directive 2006/43/EC of the European Parliament and of the Council of 17 May 2006 on statutory audits of annual accounts and consolidated accounts, amending Council Directives 78/660/EEC and 83/349/EEC and repealing Council Directive 84/253/EEC or similar national regulations]. [Option 2 if the Partner or Linked Third Party has an independent Public Officer: is a competent and independent Public Officer for which the relevant national authorities have established the legal capacity to audit the Partner]. [Option 3 if the Partner or Linked Third Party is an international organisation: is an [internal] [external] auditor in accordance with the internal financial regulations and procedures of the international organisation]. The Auditor: must be independent from the Partner [and the Linked Third Party], in particular, it must not have been involved in preparing the Partner s [and Linked Third Party s] Financial Statement(s); must plan work so that the Procedures may be carried out and the Findings may be assessed; must adhere to the Procedures laid down and the compulsory report format; must carry out the engagement in accordance with these ToR; must document matters which are important to support the Report; must base its Report on the evidence gathered; must submit the Report to the [Partner] [Linked Third Party].

95 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 The Commission sets out the Procedures to be carried out and the Findings to be endorsed by the Auditor. The Auditor is not responsible for their suitability or pertinence. As this engagement is not an assurance engagement the Auditor does not provide an audit opinion or a statement of assurance. 1.3 Applicable Standards The Auditor must comply with these Terms of Reference and with 1 : - the International Standard on Related Services ( ISRS ) 4400 Engagements to perform Agreed-upon Procedures regarding Financial Information as issued by the International Auditing and Assurance Standards Board (IAASB); - the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants (IESBA). Although ISRS 4400 states that independence is not a requirement for engagements to carry out agreed-upon procedures, the Agency requires that the Auditor also complies with the Code s independence requirements. The Auditor s Report must state that there was no conflict of interests in establishing this Report between the Auditor and the Partner [and the Linked Third Party] that could have a bearing on the Report, and must specify if the service is invoiced - the total fee paid to the Auditor for providing the Report. 1.4 Reporting The Report must be written in the language of the Agreement (see Article 20.7 of the Agreement). Under Article 28 of the Framework Partnership Agreement, the Commission, the Agency, the European Anti-Fraud Office and the Court of Auditors have the right to audit any work that is carried out under the action and for which costs are claimed from the European Union. This includes work related to this engagement. The Auditor must provide access to all working papers related to this 1 Supreme Audit Institutions applying INTOSAI-standards may carry out the Procedures according to the corresponding International Standards of Supreme Audit Institutions and code of ethics issued by INTOSAI instead of the International Standard on Related Services ( ISRS ) 4400 and the Code of Ethics for Professional Accountants issued by the IAASB and the IESBA.

96 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 assignment if the Commission, the Agency, the European Anti-Fraud Office or the European Court of Auditors requests them. 1.5 Timing The Report must be provided by [dd Month yyyy]. 1.6 Other Terms [The [Partner] [Linked Third Party] and the Auditor can use this section to agree other specific terms, such as the Auditor s fees, liability, applicable law, etc. Those specific terms must not contradict the terms specified above.] [legal name of the Auditor] [legal name of the [Partner] [Linked Third Party]] [name & title of authorised representative] [dd Month yyyy] Signature of the Auditor [name & title of authorised representative] [dd Month yyyy] Signature of the [Partner][Linked Third Party]

97 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Independent report of factual findings on the methodology concerning grant agreements financed under the Horizon 2020 Research and Innovation Framework Programme (To be printed on letterhead paper of the auditor) To [ name of contact person(s)], [Position] [[Partner s] [Linked Third Party s] name] [ Address] [ dd Month yyyy] Dear [Name of contact person(s)], As agreed under the terms of reference dated [dd Month yyyy] with [OPTION 1: [insert name of the Partner] ( the Partner)] [OPTION 2: [insert name of the linked third party] ( the Linked Third Party ), third party linked to the Partner [insert name of the Partner] ( the Partner)], we [ name of the auditor] ( the Auditor ), established at [full address/city/state/province/country], represented by

98 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 [name and function of an authorised representative], have carried out the agreed-upon procedures ( the Procedures ) and provide hereby our Independent Report of Factual Findings ( the Report ), concerning the [Partner s] [Linked Third Party s] usual accounting practices for calculating and declaring direct personnel costs declared as unit costs ( the Methodology ). You requested certain procedures to be carried out in connection with the grant(s) [title and number of the grant agreement(s)] ( the Agreement(s) ). The Report Our engagement was carried out in accordance with the terms of reference ( the ToR ) appended to this Report. The Report includes: the standard statements ( the Statements ) made by the [Partner] [Linked Third Party], the agreed-upon procedures ( the Procedures ) carried out and the standard factual findings ( the Findings ) confirmed by us. The engagement involved carrying out the Procedures and assessing the Findings and the documentation requested appended to this Report, the results of which the Commission uses to draw conclusions regarding the acceptability of the Methodology applied by the [Partner] [Linked Third Party]. The Report covers the methodology used from [dd Month yyyy]. In the event that the [Partner] [Linked Third Party] changes this methodology, the Report will not be applicable to any Financial Statement 2 submitted thereafter. 2 Financial Statement in this context refers solely to Annex 3 of the Specific Agreement by which the Partner declares costs under the Agreement.

99 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 The scope of the Procedures and the definition of the standard statements and findings were determined solely by the Commission. Therefore, the Auditor is not responsible for their suitability or pertinence. Since the Procedures carried out constitute neither an audit nor a review made in accordance with International Standards on Auditing or International Standards on Review Engagements, we do not give a statement of assurance on the costs declared on the basis of the [Partner s] [Linked Third Party s] Methodology. Had we carried out additional procedures or had we performed an audit or review in accordance with these standards, other matters might have come to its attention and would have been included in the Report. Exceptions Apart from the exceptions listed below, the [Partner] [Linked Third Party] agreed with the standard Statements and provided the Auditor all the documentation and accounting information needed by the Auditor to carry out the requested Procedures and corroborate the standard Findings. List here any exception and add any information on the cause and possible consequences of each exception, if known. If the exception is quantifiable, also indicate the corresponding amount... Explanation of possible exceptions in the form of examples (to be removed from the Report): i. the [Partner] [Linked Third Party] did not agree with the standard Statement number because ; ii. the Auditor could not carry out the procedure established because. (e.g. due to the inability to reconcile key information or the unavailability or inconsistency of data); iii. the Auditor could not confirm or corroborate the standard Finding number because. Remarks We would like to add the following remarks relevant for the proper understanding of the Methodology applied by the [Partner] [Linked Third Party] or the results reported.

100 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Example (to be removed from the Report): Regarding the methodology applied to calculate hourly rates Regarding standard Finding 15 it has to be noted that The [Partner] [Linked Third Party] explained the deviation from the benchmark statement XXIV concerning time recording for personnel with no exclusive dedication to the action in the following manner: Annexes Please provide the following documents to the auditor and annex them to the report when submitting this CoMUC to the Commission: 1. Brief description of the methodology for calculating personnel costs, productive hours and hourly rates; 2. Brief description of the time recording system in place; 3. An example of the time records used by the [Partner] [Linked Third Party]; 4. Description of any budgeted or estimated elements applied together with an explanation as to why they are relevant for calculating the personnel costs and how they are based on objective and verifiable information; 5. A summary sheet with the hourly rate for direct personnel declared by the [Partner] [Linked Third Party] and recalculated by the Auditor for each staff member included in the sample (the names do not need to be reported); 6. A comparative table summarising for each person selected in the sample a) the time claimed by the [Partner] [Linked Third Party] in the Financial Statement(s) and b) the time according to the time record verified by the Auditor; 7. A copy of the letter of representation provided to the Auditor. Use of this Report This Report has been drawn up solely for the purpose given under Point 1.1 Reasons for the engagement. The Report:

101 Framework Partnership Agreement number: [insert number and acronym] Specific Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September is confidential and is intended to be submitted to the Commission by the [Partner] [Linked Third Party] in connection with Article 24 of the Framework Partnership Agreement; - may not be used by the [Partner] [Linked Third Party] or by the Commission for any other purpose, nor distributed to any other parties; - may be disclosed by the Commission only to authorised parties, in particular the European Anti-Fraud Office (OLAF) and the European Court of Auditors. - relates only to the usual cost accounting practices specified above and does not constitute a report on the Financial Statements of the [Partner] [Linked Third Party]. No conflict of interest 3 exists between the Auditor and the Partner [and the Linked Third Party] that could have a bearing on the Report. The total fee paid to the Auditor for producing the Report was EUR (including EUR of deductible VAT). We look forward to discussing our Report with you and would be pleased to provide any further information or assistance which may be required. Yours sincerely [legal name of the Auditor] [name and title of the authorised representative] [dd Month yyyy] Signature of the Auditor 3 A conflict of interest arises when the Auditor's objectivity to establish the certificate is compromised in fact or in appearance when the Auditor for instance: - was involved in the preparation of the Financial Statements; - stands to benefit directly should the certificate be accepted; - has a close relationship with any person representing the beneficiary; - is a director, trustee or partner of the beneficiary; or - is in any other situation that compromises his or her independence or ability to establish the certificate impartially.

102 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Statements to be made by the Partner/Linked Third Party ( the Statements ) and Procedures to be carried out by the Auditor ( the Procedures ) and standard factual findings ( the Findings ) to be confirmed by the Auditor The Commission reserves the right to provide the auditor with guidance regarding the Statements to be made, the Procedures to be carried out or the Findings to be ascertained and the way in which to present them. The Commission reserves the right to vary the Statements, Procedures or Findings by written notification to the Partner/Linked Third Party to adapt the procedures to changes in the grant agreement(s) or to any other circumstances. If this methodology certificate relates to the Linked Third Party s usual accounting practices for calculating and claiming direct personnel costs declared as unit costs any reference here below to the Partner is to be considered as a reference to the Linked Third Party. Please explain any discrepancies in the body of the Report. Statements to be made by Partner Procedures to be carried out and Findings to be confirmed by the Auditor A. Use of the Methodology I. The cost accounting practice described below has been in use since [dd Month yyyy]. II. The next planned alteration to the methodology used by the Partner will be from [dd Month yyyy]. Procedure: The Auditor checked these dates against the documentation the Partner has provided. Factual finding: 1. The dates provided by the Partner were consistent with the documentation. 12

103 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner Procedures to be carried out and Findings to be confirmed by the Auditor B. Description of the Methodology III. The methodology to calculate unit costs is being used in a consistent manner and is reflected in the relevant procedures. [Please describe the methodology your entity uses to calculate personnel costs, productive hours and hourly rates, present your description to the Auditor and annex it to this certificate] [If the statement of section B. Description of the methodology cannot be endorsed by the Partner or there is no written methodology to calculate unit costs it should be listed here below and reported as exception by the Auditor in the main Report of Factual Findings: Procedure: The Auditor reviewed the description, the relevant manuals and/or internal guidance documents describing the methodology. Factual finding: 2. The brief description was consistent with the relevant manuals, internal guidance and/or other documentary evidence the Auditor has reviewed. 3. The methodology was generally applied by the Partner as part of its usual costs accounting practices. - ] C. Personnel costs General IV. The unit costs (hourly rates) are limited to salaries including during parental leave, social security contributions, taxes and other costs included in the remuneration required under national law and the Procedure: The Auditor draws a sample of employees to carry out the procedures indicated in this section C and the following sections D to F. [The Auditor has drawn a random sample of 10 full-time equivalents made up of employees assigned to the action(s). If fewer than 10 full-time equivalents are 13

104 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner employment contract or equivalent appointing act; V. Employees are hired directly by the Partner in accordance with national law, and work under its sole supervision and responsibility; VI. VII. VIII. IX. The Partner remunerates its employees in accordance with its usual practices. This means that personnel costs are charged in line with the Partner s usual payroll policy (e.g. salary policy, overtime policy, variable pay) and no special conditions exist for employees assigned to tasks relating to the European Union or Euratom, unless explicitly provided for in the grant agreement(s); The Partner allocates its employees to the relevant group/category/cost centre for the purpose of the unit cost calculation in line with the usual cost accounting practice; Personnel costs are based on the payroll system and accounting system. Any exceptional adjustments of actual personnel costs resulted from relevant budgeted or estimated elements and were based on objective and verifiable information. [Please describe the budgeted or estimated elements and their relevance to personnel costs, and explain how they were reasonable and based on objective and verifiable information, present your explanation to the Auditor and annex it to this certificate]. X. Personnel costs claimed do not contain any of the following ineligible costs: costs related to return on capital; debt and debt service charges; provisions for future losses or debts; interest owed; doubtful debts; currency exchange losses; bank costs charged by the Partner s bank for transfers from the Commission/Agency; excessive or reckless expenditure; deductible VAT or costs incurred during suspension of the implementation of the action. XI. Personnel costs were not declared under another EU or Euratom grant Procedures to be carried out and Findings to be confirmed by the Auditor assigned to the action(s), the Auditor has selected a sample of 10 full-time equivalents consisting of all employees assigned to the action(s), complemented by other employees irrespective of their assignments.]. For this sample: the Auditor reviewed all documents relating to personnel costs such as employment contracts, payslips, payroll policy (e.g. salary policy, overtime policy, variable pay policy), accounting and payroll records, applicable national tax, labour and social security law and any other documents corroborating the personnel costs claimed; in particular, the Auditor reviewed the employment contracts of the employees in the sample to verify that: i. they were employed directly by the Partner in accordance with applicable national legislation; ii. they were working under the sole technical supervision and responsibility of the latter; iii. they were remunerated in accordance with the Partner s usual practices; iv. they were allocated to the correct group/category/cost centre for the purposes of calculating the unit cost in line with the Partner s usual cost accounting practices; the Auditor verified that any ineligible items or any costs claimed under other costs categories or costs covered by other types of grant or by other grants financed from the European Union budget have not been taken into account when calculating the personnel costs; the Auditor numerically reconciled the total amount of personnel costs used 14

105 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner (including grants awarded by a Member State and financed by the EU budget and grants awarded by bodies other than the Commission/Agency for the purpose of implementing the EU budget). If additional remuneration as referred to in the grant agreement(s) is paid XII. XIII. XIV. XV. The Partneris a non-profit legal entity; The additional remuneration is part of the Partner s usual remuneration practices and paid consistently whenever the relevant work or expertise is required; The criteria used to calculate the additional remuneration are objective and generally applied regardless of the source of funding; The additional remuneration included in the personnel costs used to calculate the hourly rates for the grant agreement(s) is capped at EUR per full-time equivalent (reduced proportionately if the employee is not assigned exclusively to the action). [If certain statement(s) of section C. Personnel costs cannot be endorsed by the Procedures to be carried out and Findings to be confirmed by the Auditor to calculate the unit cost with the total amount of personnel costs recorded in the statutory accounts and the payroll system. to the extent that actual personnel costs were adjusted on the basis of budgeted or estimated elements, the Auditor carefully examined those elements and checked the information source to confirm that they correspond to objective and verifiable information; if additional remuneration has been claimed, the Auditor verified that the Partner was a non-profit legal entity, that the amount was capped at EUR per full-time equivalent and that it was reduced proportionately for employees not assigned exclusively to the action(s). the Auditor recalculated the personnel costs for the employees in the sample. Factual finding: 4. All the components of the remuneration that have been claimed as personnel costs are supported by underlying documentation. 5. The employees in the sample were employed directly by the Partner in accordance with applicable national law and were working under its sole supervision and responsibility. 6. Their employment contracts were in line with the Partner s usual policy; 7. Personnel costs were duly documented and consisted solely of salaries, social security contributions (pension contributions, health insurance, unemployment fund contributions, etc.), taxes and other statutory costs 15

106 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner Partner they should be listed here below and reported as exception by the Auditor in the main Report of Factual Findings: - ] D. Productive hours XVI. The number of productive hours per full-time employee applied is [delete as appropriate]: A productive hours per year for a person working full-time (corresponding pro-rata for persons not working full time). B. the total number of hours worked in the year by a person for the Partner C. the standard number of annual hours generally applied by the Procedures to be carried out and Findings to be confirmed by the Auditor included in the remuneration (holiday pay, thirteenth month s pay, etc.); 8. The totals used to calculate the personnel unit costs are consistent with those registered in the payroll and accounting records; 9. To the extent that actual personnel costs were adjusted on the basis of budgeted or estimated elements, those elements were relevant for calculating the personnel costs and correspond to objective and verifiable information. The budgeted or estimated elements used are: (indicate the elements and their values). 10. Personnel costs contained no ineligible elements; 11. Specific conditions for eligibility were fulfilled when additional remuneration was paid: a) the Partner is registered in the grant agreements as a non-profit legal entity; b) it was paid according to objective criteria generally applied regardless of the source of funding used and c) remuneration was capped at EUR per full-time equivalent (or up to up to the equivalent pro-rata amount if the person did not work on the action full-time during the year or did not work exclusively on the action). Procedure (same sample basis as for Section C: Personnel costs): The Auditor verified that the number of productive hours applied is in accordance with method A, B or C. The Auditor checked that the number of productive hours per full-time employee is correct and that it is reduced proportionately for employees not exclusively assigned to the action(s). If method B is applied the Auditor verified i) the manner in which the total number of hours worked was done and ii) that the contract specified the 16

107 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner If method B is applied XVII. XVIII. Partner for its personnel in accordance with its usual cost accounting practices. This number must be at least 90% of the standard annual workable hours. The calculation of the total number of hours worked was done as follows: annual workable hours of the person according to the employment contract, applicable labour agreement or national law plus overtime worked minus absences (such as sick leave and special leave). Annual workable hours are hours during which the personnel must be working, at the employer s disposal and carrying out his/her activity or duties under the employment contract, applicable collective labour agreement or national working time legislation. XIX. The contract (applicable collective labour agreement or national working time legislation) do specify the working time enabling to calculate the annual workable hours. If method C is applied Procedures to be carried out and Findings to be confirmed by the Auditor annual workable hours by inspecting all the relevant documents, national legislation, labour agreements and contracts. If method C is applied the Auditor reviewed the manner in which the standard number of working hours per year has been calculated by inspecting all the relevant documents, national legislation, labour agreements and contracts and verified that the number of productive hours per year used for these calculations was at least 90 % of the standard number of working hours per year. Factual finding: General 12. The Partner applied a number of productive hours consistent with method A, B or C detailed in the left-hand column. 13. The number of productive hours per year per full-time employee was accurate and was proportionately reduced for employees not working fulltime or exclusively for the action. If method B is applied XX. XXI. XXII. The standard number of productive hours per year is that of a full-time equivalent; for employees not assigned exclusively to the action(s) this number is reduced proportionately. The number of productive hours per year on which the hourly rate is based i) corresponds to the Partner s usual accounting practices; ii) is at least 90 % of the standard number of workable (working) hours per year. Standard workable (working) hours are hours during which personnel are 14. The number of annual workable hours, overtime and absences was verifiable based on the documents provided by the Partner and the calculation of the total number of hours worked was accurate. 15. The contract specified the working time enabling to calculate the annual workable hours. If method C is applied 17

108 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner at the Partner s disposal preforming the duties described in the relevant employment contract, collective labour agreement or national labour legislation. The number of standard annual workable (working) hours that the Partner claims is supported by labour contracts, national legislation and other documentary evidence. [If certain statement(s) of section D. Productive hours cannot be endorsed by the Partner they should be listed here below and reported as exception by the Auditor: - ] Procedures to be carried out and Findings to be confirmed by the Auditor 16. The calculation of the number of productive hours per year corresponded to the usual costs accounting practice of the Partner. 17. The calculation of the standard number of workable (working) hours per year was corroborated by the documents presented by the Partner. 18. The number of productive hours per year used for the calculation of the hourly rate was at least 90 % of the number of workable (working) hours per year. E. Hourly rates The hourly rates are correct because: XXIII. Hourly rates are correctly calculated since they result from dividing annual personnel costs by the productive hours of a given year and group (e.g. staff category or department or cost centre depending on the methodology applied) and they are in line with the statements made in section C. and D. above. Procedure The Auditor has obtained a list of all personnel rates calculated by the Partner in accordance with the methodology used. The Auditor has obtained a list of all the relevant employees, based on which the personnel rate(s) are calculated. For 10 full-time equivalent employees selected at random (same sample basis as Section C: Personnel costs): The Auditor recalculated the hourly rates. [If the statement of section E. Hourly rates cannot be endorsed by the Partner The Auditor verified that the methodology applied corresponds to the usual accounting practices of the organisation and is applied consistently for all activities of the organisation on the basis of objective criteria irrespective of the source of funding. 18

109 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner Procedures to be carried out and Findings to be confirmed by the Auditor they should be listed here below and reported as exception by the Auditor: - ] Factual finding: 19. No differences arose from the recalculation of the hourly rate for the employees included in the sample. F. Time recording XXIV. Time recording is in place for all persons with no exclusive dedication to one Horizon 2020 action. At least all hours worked in connection with the grant agreement(s) are registered on a daily/weekly/monthly basis [delete as appropriate] using a paper/computer-based system [delete as appropriate]; XXV. For persons exclusively assigned to one Horizon 2020 activity the Partner has either signed a declaration to that effect or has put arrangements in place to record their working time; XXVI. Records of time worked have been signed by the person concerned (on paper or electronically) and approved by the action manager or line manager at least monthly; XXVII. Measures are in place to prevent staff from: i. recording the same hours twice, ii. recording working hours during absence periods (e.g. holidays, sick leave), iii. recording more than the number of productive hours per year used Procedure The Auditor reviewed the brief description, all relevant manuals and/or internal guidance describing the methodology used to record time. The Auditor reviewed the time records of the random sample of 10 full-time equivalents referred to under Section C: Personnel costs, and verified in particular: that time records were available for all persons with not exclusive assignment to the action; that time records were available for persons working exclusively for a Horizon 2020 action, or, alternatively, that a declaration signed by the Partner was available for them certifying that they were working exclusively for a Horizon 2020 action; that time records were signed and approved in due time and that all minimum requirements were fulfilled; that the persons worked for the action in the periods claimed; that no more hours were claimed than the productive hours used to 19

110 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner to calculate the hourly rates, and iv. recording hours worked outside the action period. XXVIII. No working time was recorded outside the action period; XXIX. No more hours were claimed than the productive hours used to calculate the hourly personnel rates. [Please provide a brief description of the time recording system in place together with the measures applied to ensure its reliability to the Auditor and annex it to the present certificate 4 ]. Procedures to be carried out and Findings to be confirmed by the Auditor calculate the hourly personnel rates; that internal controls were in place to prevent that time is recorded twice, during absences for holidays or sick leave; that more hours are claimed per person per year for Horizon 2020 actions than the number of productive hours per year used to calculate the hourly rates; that working time is recorded outside the action period; the Auditor cross-checked the information with human-resources records to verify consistency and to ensure that the internal controls have been effective. In addition, the Auditor has verified that no more hours were charged to Horizon 2020 actions per person per year than the number of productive hours per year used to calculate the hourly rates, and verified that no time worked outside the action period was charged to the action. Factual finding: [If certain statement(s) of section F. Time recording cannot be endorsed by the Partner they should be listed here below and reported as exception by the Auditor: - ] 20. The brief description, manuals and/or internal guidance on time recording provided by the Partner were consistent with management reports/records and other documents reviewed and were generally applied by the Partner to produce the financial statements. 21. For the random sample time was recorded or, in the case of employees working exclusively for the action, either a signed declaration or time 4 The description of the time recording system must state among others information on the content of the time records, its coverage (full or action time-recording, for all personnel or only for personnel involved in H2020 actions), its degree of detail (whether there is a reference to the particular tasks accomplished), its form, periodicity of the time registration and authorisation (paper or a computer-based system; on a daily, weekly or monthly basis; signed and countersigned by whom), controls applied to prevent double-charging of time or ensure consistency with HR-records such as absences and travels as well as it information flow up to its use for the preparation of the Financial Statements. 20

111 Framework Partnership Agreement number: [insert number and acronym] Specific Grant Agreement number(s): [insert number(s) and acronym(s)] Grant Agreement number(s): [insert number(s) and acronym(s)] EASME Model Grant Agreements: EEN FPA Multi: September 2014 Please explain any discrepancies in the body of the Report. Statements to be made by Partner Procedures to be carried out and Findings to be confirmed by the Auditor records were available; 22. For the random sample the time records were signed by the employee and the action manager/line manager, at least monthly. 23. Working time claimed for the action occurred in the periods claimed; 24. No more hours were claimed than the number productive hours used to calculate the hourly personnel rates; 25. There is proof that the Partner has checked that working time has not been claimed twice, that it is consistent with absence records and the number of productive hours per year, and that no working time has been claimed outside the action period. 26. Working time claimed is consistent with that on record at the humanresources department. [official name of the [Partner] [Linked Third Party]] [name and title of authorised representative] [dd Month yyyy] <Signature of the [Partner] [Linked Third Party]> [official name of the Auditor] [name and title of authorised representative] [dd Month yyyy] <Signature of the Auditor> 21

112 This document is digitally sealed. The digital sealing mechanism uniquely binds the document to the modules of the Participant Portal of the European Commission, to the transaction for which it was generated and ensures its integrity and authenticity. Any attempt to modify the content will lead to a breach of the electronic seal, which can be verified at any time by clicking on the digital seal validation symbol. Commission européenne/europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË - Tel