How to use European Structural Funds for Dual-Use Technologies?

1. How to use European Structural Funds for Dual-Use Technologies? Helsinki 25 March 2014

2. Aims of the presentation • Developing your understanding of the specificities of ESIF, the way they work and the potential opportunities they offer toyou as Dual-Use technology stakeholders (public entities, enterprises, public and private research centres, universities…) • Allowing you to acquire a standard knowledge and the necessary support to develop potential eligible projects • Presenting you a methodology and guidelines to submit a project

3. picture Content Agenda

4. picture 1 • EU2020 strategy big picture

5. Europe 2020 big picture Key drivers and priorities • Europe 2020 is a strategy launched by the EC in July 2010, which has set the following objectives: • Enable member economies to emerge stronger from crisis • Transform the EU economy as a "smart, sustainable and inclusive“ • Ensure a society with high employment levels, good productivity, social cohesion EU 2020 3 priorities Smart Growth Sustainable Growth Inclusive Growth 5 Objectives Employment Innovation Climate change Education Poverty/ Social Exclusion 7 flagship initiatives Digital agenda for Europe Innovation Union Youth on the move Resource efficient Europe An industrial policy for the globalisation An agenda for new skills and jobs European platform against poverty

6. Innovation Union at the core of the Europe 2020 Strategy The EU has set ambitious objectives to be reached by 2020 in five main areas: Employment - 75 % of the population aged 20-64 should be employed Innovation- 3% of the EU's GDP should be invested in Research & Development Climate change - The "20/20/20" climate/energy targets should be met (including an increase to 30% of emissions reduction if the conditions are right) Education- The share of early school leavers should be under 10% and at least 40% of 30-34 years old should have completed a tertiary or equivalent education Poverty- Reduction of poverty by aiming to lift at least 20 million people out of the risk of poverty or exclusion The “Innovation Union" aims to improve conditions and access to finance for R&I, to ensure that innovative ideas can be turned into products and services that create growth and jobs.

7. picture 2 ESIF: The main instruments for cohesion policy

8. Structural Funds and Cohesion Policy in 2014-2020: A brief overview Structural Funds (2014-2020) EUR 352 B • ESIF are the financial instruments through which EU Cohesion Policy is implemented • It aims to strengthen competitiveness and innovation • Cohesion Policy contributes to raising the EU’s long-term research and innovation performance based on smart specialisation • The implementation and allocation of funds to projects is handled by byManaging Authorities in Member States at local/regional/national levels • Structural funds are based on the principle of co-financing between the EU and Member States/ project holders* • * Co-financing levels vary depending on regional GDP compared to the EU average GDP, status of the project holder, Operational Programme specific rules • The three main funds under which research and innovation activities can be supported are: • European Regional Development Fund (ERDF) and European Social Fund (ESF):EUR 273 B • Cohesion Fund: EUR 63 B • European territorial cooperation: EUR 10,2 B • . 3% 1% 18% 78%

9. 2 Key drivers for the 2014-2020 programming period 2 1 Focus on Thematic Objectives (TO) Be based on R&I Strategies for Smart Specialisations (RIS3) Research & innovation Information & Communication Technologies Competitiveness of Small and Medium-sized Enterprises (SMEs) Shift towards a low-carbon economy Climate change adaptation & risk prevention and management Environmental protection & resource efficiency Sustainable transport & removing bottlenecks in key network infrastructures Employment & supporting labour mobility Social inclusion & combating poverty Education, skills & lifelong learning Institutional capacity building & efficient public administrations The RIS3 requires national/regional authorities to identify the unique characteristics and assets of each country and region, so as to focus on policy support and investments received through Structural Funds. Stakeholder participation and ownership is essential to the development of these strategies. Experience shows that thematic concentration allows for an increase in effectiveness of public interventions by reaching a critical mass with a real impact on the socio-economic situation of a country and its regions. Prioritisation is of particular importance in times of fiscal consolidation.

10. Dual-use technologies and key enabling technologies Cluster mapping linked with defence/security dual-use technologies European Commission’s definition: Goods and technologies are considered to be dual-use when they can be used for both civil and military purposes. • Defence expenditure is not eligible for Structural Funds. • However: • Security has become a top priority for the European Union • Dual-use technologies that are transversal to both defence and security can be eligible • Key enabling technologies can be applied to several sectors Source: Europe Innova project, www.clusterobservatory.eu Nuclear, biological & chemical sectors Encryption Computers Materials processing equipment Telecommunications Electronics Aerospace & propulsion equipment Marine equipment Sensors & lasers Navigation & avionics

11. Smart specialisation in HelsinkiINKA-hubs and partners Concept of Inka: • Public-private collaboration: Pools the best competencies locally (companies, research organisations, universities, users) • Encourages to interregional and international collaboration • Competitive, agile, fast, risk-taking, experimental • Actions will closely link to EU Structural funds and Horizon 2020 programmes OULU JOENSUU Turku Bioeconomy Kuopio Future Health Seinäjoki Tampere Jyväskylä Helsinki Region JYVÄSKYLÄ Cybersecurity Sustainable Energy Solutions Oulu TAMPERE Pori Lappeenranta Smart City and Renewing Industries Turku Lahti Helsinki Region

12. Operational programmes (Ops) in Finland • Operational programmes at national/ level • Finnish structural funds programme for sustainablegrowth and job 2014-2020 • Operational programme of Aland • Cooperation programmes • Cross-border cooperation: • - Nord (North) • - Botnia-Atlantica • - Central Baltic • Transnational cooperation programmes: • - NorthernPeriphery and Arctic • - BalticSeaRegion • Interregionalcooperation programmes: • - INTERREG EUROPE • - INTERACT • - URBACT • - ESPON Aland The new ESIF in Finland will be structured through one major OP + one specific OP for Alands. Actions and projects will, in most cases, be selected in the regions based on their own regional plans and decision-making.

13. Priorities for funding in Finland (main OP) The Finnish ERDF main OP priorities

14. Budget allocation per thematic objectives Presentation title

15. Cooperation programmes brief description (1/2)

16. Cooperation programmes brief description (2/2)

17. ERDF specific thematic objectives for SMEs • The ERDF supports the development and structural adjustment of regional economies, including the conversion of declining industrial regions. Funds can either be allocated as grants or financial instruments. The ERDF contributes to all of the 9 thematic objectives. In the context of SME policies the following thematic objectives are of particular interest: • Objective n°1: Strengthening research, technological development and innovation • Objective n°2: Enhancing access to and use and quality of Information and Communication Technologies (ICTs) • Objective n°3: Enhancing the competitiveness of SMEs

18. picture 3 How to apply a project?

19. 3.1 Eligibility characteristics of projects

20. Project eligibility: an overview Relevant objectives, clear added-value and appropriate location of the project, proposed by the right beneficiaries, featuring a realistic and collaborative approach and foreseeing tangible results and impacts Key characteristics Setting up appropriate project management and monitoring structures (e.g. in terms of identifying realistic indicators, planning for evaluations and managing risks) Added value components PROJECT ELIGIBILITY Best and worst practices identified from past experiences Lessons learned Meeting the rules and conditions for co-financing Lessons learned Co-financing

21. What are the key characteristics that projects must have to be eligible?

22. Added-value components for project eligibility • Quantifying and qualifying the targets • Indicating realistic means for expected results • Choosing the right indicators (implementation and results) and limiting their number • Planning for an external evaluation of activities and results • Planning and risk management: • Setting up adequate project management and quality assurance processes • Respecting European policies (competition; procurement; environment; equal opportunities; employment; reduction of inequalities; etc) • Avoiding delays • Keeping within the budget • Meeting reporting requirements • Carrying out information and publicity activities

23. Lessons learned from best/worst practices • Do not submit your application before obtaining an agreement in principle or a confirmation of the interests of administrators/actors (OP Managing Authorities) • Describe the project by focusing on EU priorities and using the appropriate vocabulary • Try to raise support for the project in the territory before submission (communication and dissemination) • Try to involve different stakeholders in the project area • Involve companies (SMEs and RTD performers) and disseminate EU added values • Describe the potential impact on the economic development of the area • Try to integrate your project within the strategy of your organization, sharing it with and showcasing it for the relevant actors • Check that human resources are sufficient • Anticipate delays in payments and non-payments by budgeting for sufficient working capital • Think about the sustainability of your project

24. Co-financing • Structural funds work on the principle of co-financing: the costs of a project are shared between the EU and Member States/project holders/external funding • The total planned “own” resources and the contribution from the Funds have to be clear • The co-financing is usually based on a maximum rate and a maximum amount • Co-financing takes place in the form of non reimbursable grants, usually paid on expenditure occurred and linked to means and not to results • In order to be eligible, expenditure must be incurred between 1.1.2007 - 31.12.2015 • Co-financed transactions must not be completed before the starting date for eligibility • Rules are established at national level • Cost categories excluded from co-financing • Debt interest and recoverable VAT • In the case of land costs, these cannot exceed 10% of the total eligible expenditure of the operation concerned • Decommissioning of nuclear power stations • Lost opportunity costs

25. 3.2 Applying for co-financing

26. Methodology: 3 phases for an optimal approach to applying for co-financing 1: Draft the Project Factsheet 2: Identify the funding measure & assess the project eligibility 3: Draft, test and submit the Application Form • Who? • What? • Why? • Where? • How? • Outcome expected? • Track the appropriate funding measure • Analyze the eligibility • Control the compliance • Fill-in the Application Form • Fill-in the 10 sections • Check the compliance • Submit the Application Form

27. What Who Methodology: Phase 1 1 3 2 Draft the project factsheet Provide data and information required to track the appropriate funding measure and check the compliance with the eligibility criteria and selection priorities For Whom Direct and indirect targets in terms of population eligible (beneficiary groups)? Direct targets are the first beneficiaries of the action and directly affected by the project activities. Description of the project holder How Activities and means to be undertaken to achieve your qualitative and quantitative objectives? Description of the project management to deliver the project to limit the risks related to three criteria: timing, budget and technical specifications. The main scope of the project, the budget, proposed co-financing arrangements Why Context, rationale and the project value proposal. Provide the state of the art. Describe the overall and the specific objectives of the project. Precise how the project will support: ● the EU 2020 strategy ● the regional smart specialization (S3 ● the OP, specific priorities and objectives. Results Concrete measurable outcomes. Criteria to be used to measure the success? Demonstrate the project added value with quantitative and qualitative indicators Compliance Where Check the specific eligibility indicators and selection priorities. Verify the status and the size of eligible project orders, eligible charges, co-funding rate and beneficiaries. Location of the project? Why has this location?

28. Methodology: Phase 2 3 Identify the fundingmeasure and assess the projecteligibility 2. 1. Track the appropriatefundingmeasureqqqqqqqqqqqqqqqqqqqqqqqqqqqqqqqqq • Check the compliance of the project with the regional smart specialization • 1. Identify potential locations to develop the project: • 2. Analysethe S3 platform website to identify the best region according to project specificities and regional smart specialization • 3. Select the final location to develop the project and get the co-funding. • The project must have a legal entity in the region to be selected 1 • Identify: • ● the most appropriate Region • ●the appropriate Operational Programme • ● the right priorityandfunding measures in the Ops • Check • ● the specific eligibility rules • ● Priority indicators Analyse the eligibility ● Check the timing of the application process ● Check the alignment of the project characteristics with the measures eligibility rules and priorities ● Control with Managing Authority the project compliance with the Funding measure eligibility rules and selection priorities • Use the InfoRegio web portal to find information • Use the European Commission’s central web portals to research funding opportunities. You will find information on OPs, categories of regions, legislation, for the kind of initiative you would like to set up to support SMEs or entrepreneurship in your region. • http://ec.europa.eu/regional_policy/index_fr.cfm 2 Control the compliance ● Check State Aids rules

29. Methodology: Phase 2 S3 Platform, JRC websiteprovides all information and details to analyse the mostappropriateregions 1 1 3 2 • The websiteprovidespresentation of regional smart specialisationstrategiesand in most cases background materialthatprovidescontext to the cases and direct link to the Region’swebsite. http://s3platform.jrc.ec.europa.eu/regions/FI196/tags/FI196

30. Methodology: Phase 2 Inforegio: The first source to track ERDF fundings (1/2) 2 1 3 2 • Select your country and access to the different types of programmes ( national level, cross-border co-operation and transnational cooperation) http://ec.europa.eu/regional_policy/index_en.cfm

31. Methodology: Phase 2 Inforegio: The first source to track ERDF fundings (2/2) 2 1 3 2 • Access Operational programme summary for identifying main priorities • Access to Managing Authorities contact to get full operational programme with more details *This example is elaborated on the data from the last programming period 2007-2013 as the information is not yet published on the website for the current period.

32. Methodology: Phase 3 3 1. 2. Draft, test and submit the application form Fill-in the application form* Check the compliance Fill-in the 10 sections ● Meet the Managing Authority to check whether the project matches with eligibility criteria and selection priorities ● Adapt the project ● Check the compliance of the project with all EU requirements Identification of the Project Holder ● Project details ● Project Applicant ● Delivery partner ● Strategic Fit ● Rationale ● Estimated deliverables (Outputs/ results/ Impacts), Costs and Funding ● Project management capacity and risk ● Compliance ● Applicant declaration and certification * For an example, check out the Outline Application Form Guidance ERDF-GN-2-001 available on internet Submit the application form in due time Project application procedure differs from countries Project application procedures differ substantially from one region to another. To fill-in the sections of the Application Form, check which guides and users’ manuals have been established in your region / country. In order to provide potential project holders with real-life examples. The applications are published in the original language together with an English translation and are available under the following link: http://ec.europa.eu/enterprise/policies/sme/regional-sme- policies/applicationexamples • Answer any request for clarifications