Preparing a consortium agreement for FP7

1
Preparing a consortium agreement for FP7 the
basics

• Jenny Melia, National Delegate NMP Programme

2
Overview

• What is covered by a typical consortium
  agreement
• Model FP7 agreements available
• Checklist for developing a consortium agreement
• Common mistakes pitfalls (FP6)

3
What is a consortium agreement (CA)

• The CA is an agreement made between participants
  to govern a number of issues that will or may
  arise during the project. It applies to all the
  contractors participating in the project covered
  by the contract.
• The Community is not a party to any CA and does
  not establish the terms and conditions of the CA
  but it issues guidelines for development
• In principle, the CA should in principle be
  negotiated and signed before starting the
  project.
• A consortium agreement is required for all
  projects financed under FP7 except those exempted
  from this obligation by the call for proposals to
  which they have applied.

4
What does the consortium agreement govern?

• 1. General Information on project
• 2. Technical Provisions and the internal
  organisation of the consortium
• 3. Financial and Legal Provisions
• 4. Management of Intellectual Property Rights
• 5. The settlement of internal disputes.

• Defined by the Rules for Participation and the EC
  Grant Agreement
• for the implementation of FP7. It must comply
  with these documents.

5
Outline of typical CA (based on FP6)

• General information and conditions, Definitions
• Technical provisions
• Technical contribution of each party (as set out
  in Annex 1)
• Technical resources made available
• Project Schedule
• Expected contribution, maximum effort expected
• Modification procedure
• Provisions for dealing with non-performing
  contractor (s)

6
Outline of typical CA (based on FP6)

• Commercial provisions
• Confidentiality
• Ownership of results / joint ownership of results
  / difficult cases (background knowledge that is
  very closely linked to the result, making it
  difficult to distinguish the background from the
  result)
• Legal protection of results (patent rights)
• Commercial exploitation of results and any
  necessary access rights
• Commercial obligations
• Relevant patents, know-how, and information
• Sub-licensing
• Specific background to include for/exclude from
  use in the project?

7
Outline of typical CA (based on FP6)

• Organisational provisions
• Committees establishment, composition,
  procedures, role and nature
• Steering, management, technical, IPR, financial
  etc
• Co-ordination of committees
• Amendment / revision of the agreement
• Legal provisions
• Legal form of the co-operation
• Duration of the agreement versus duration of the
  EC contract
• Penalties for non-compliance with obligations
  under the agreement
• Applicable law and the settlement of disputes
• Secondment of personnel

8
Outline of typical CA (based on FP6)

• Financial provisions
• Financing plan
• Modification procedure
• Mutual payments, common costs
• Distribution of management costs
• Auditing of costs
• Audit certificates
• Provisions for dealing with non-performing
  contractor(s)
• Third party resources - identifying parties and
  resources

9
General Introduction

• Who are the partners, whats the context and
  purpose of the CA?
• Project title, acronym, contract no. (if
  available)
• Contract definition and additional definitions
• Terms of agreement from date to date,
  retrospective?
• Subject Annex 1 (Technical Annex) or key points
• (Definitions defines the important terms used
  throughout the CA (for the sake of clarity, it is
  advisable that those terms already defined in the
  Rules for Participation or the EC Grant Agreement
  are not repeated in the CA but that a reference
  is made to the terms used in those documents)

10
The internal organisation of the consortium

• Management and operation of the project
• Functions of coordinator
• Roles and responsibilities of management and
  steering group and /or board
• Responsibilities of each partner
• Meetings, Technical Financial reports
• Internal disputes amongst the consortium
• What to do it a partner doesnt perform, wants
  to leave early, goes bankrupt, replace partners,
  add new partners, partner wishes to block a
  publication?

Communication, Information Exchange, Supervision
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Technical Provisions

• Tasks to be undertaken by each partner and
  relationship between tasks
• Technical resources to be made available
• Project schedule and dealing with changes such as
  altering or removing tasks
• Desired technical results
• Role of Subcontractors

All of the above are captured in Annex 1
12
Financial Provisions

• Overall project total
• Total cost per partner own EC contribution
• How will ECs contribution be distributed?
• Dealing with common expenses
• 3rd party resources (Banks, VCs)
• Annual financial plan
• Define costs to be claimed under management (GA)
• Financial modifications

13
Management of Intellectual Property Rights

• How will the Foreground knowledge be managed,
  disseminated, used?
• Ownership, Joint ownership
• Who is responsible for dissemination, notice
  period, vetting procedures etc?
• Transferring to other parties
• Protection Use (security)
• Access Rights (can be more favourable than GA)
• Define conditions for further use, time limits
• Background Knowledge (can be more favourable than
  GA)
• What will be included, excluded?
• Conditions

14
General Provisions

• When does the CA start and end?
• How to deal with amendments?
• Breach of obligations and penalties, liability
  for damage caused
• Communication and applicable law
• Confidentiality procedures
• Which provisions outlive the CA?
• How often will the CA be updated?

15
Model agreements available
DESCA FP7
EUCAR
IMG
Sector specific Open access foreground
FP6 CAs
EICTA European ICT Industry Association EUCAR
Automotive Industry IMG Aerospace Industry
16
DESCA DEsign of a Simplified Consortium Agreement

• Produce one consistent modular agreement for FP7
  which balances the interests of all key player
  categories, in the spirit of Responsible
  Partnering
• Based on FP6 NoE CA
• www.desca-fp7.eu
• Number of FP6 coordinators e.g. CNRS, Fraunhofer,
  VTT
• Available without charge
• Adapt the original DESCA texts to meet your
  specific needs
• Continually updated, Version 1 now available
  online
• Simple language
• Number of modules and examples, Core text and
  explanations
• Caters for large and small projects, ROs and
  Enterprise

17
Draft Checklist for a consortium agreement

• Non-binding guidance for FP7 projects
• Prepared by the Commission
• Highlights main issues 11 parts
• Version 19/04/07 currently available
• ftp//ftp.cordis.europa.eu/pub/fp7/docs/checklist_
  en.pdf

18
Common mistakes

• Where something basic in the CA is not in line
  with the EC contract e.g. conflict regarding
  publications, project trying to speed things up
• Unclear definitions e.g. exceptional
  circumstances
• Background knowledge
• Inform Commission as well as the other
  contractors if you decide not to protect
  knowledge
• Duration of access rights
• Use of results refers to economic exploitation
  of the results and to their utilisation in
  further research activities
• http//www.ipr-helpdesk.org

19
In Summary

• Get started straight away
• Use model agreements available and FP7 checklist
• Draw up a model CA for large and small project
• Double check with your legal dept.
• Refine