The funding rules have changed significantly from FP6 with simplification of the rules, new cost models and higher grant levels for SMEs

Forms of grants

All funding is by means of a grant which is not repayable and is paid annually as an 85% advance of projected eligible costs.

Three forms of grants are proposed for the Community financial contribution:

• reimbursement of eligible costs,
• lump sums, and
• flat-rate financing (the latter can be based on scale of unit costs but also includes flat rates for indirect costs).

These may be used to cover the entire Community financial contribution for a funding scheme or more than one may be used in combination.

For most funding schemes, reimbursement of eligible costs will continue to be the preferred method, particularly at the beginning of FP7. Lump sum and flat rate financing will be introduced gradually and if successful will be used more extensively.

For frontier research actions, the ERC’s Scientific Council will propose appropriate funding modalities within the terms established by the RFP and the Financial Regulation.

Reporting and reimbursement of eligible costs

The definition of eligible costs has been simplified and the three cost reporting models used in previous framework programmes have been replaced. This means that participants can charge all their direct and indirect costs and have the option of a flat rate for indirect costs. Costs will be determined according to the usual accounting and management principles of the participants to achieve the project objectives based on principles of economy, efficiency and effectiveness.

The Community financial contribution will cover:

a maximum of 50% of eligible costs minus receipts both for research and for demonstration activities, with a top up of a maximum of 25% for research activities for SMEs, public bodies, secondary and higher education establishments and non-profit research organisations;

100% of ‘frontier research’ actions for all entities.

up to 100% for all other activities, including coordination and support actions, and training and career development of researchers, for all entities.

The maxima indicated above are applied to all eligible costs even where part of the reimbursement of costs, or even the full funding of the project, is based on lump sums or flat rates.

For Networks of Excellence, a special lump sum is proposed, with a fixed amount per researcher per year. Portions of the lump sum would be paid periodically according to indicators showing progressive implementation of the Joint Programme of Activities (JPA).

To access the agreement, please visit http://cordis.europa.eu/fp7/calls-grant-agreement_en.html#standard_ga