Applications and Finances

The Agreement on the European Economic Area (EEA) unites the 27 EU Member States and the three EFTA EEA States, Iceland, Liechtenstein and Norway, in one Internal Market governed by the same basic rules and legislation. These rules cover the four freedoms, i.e. free movement of goods, capital, services and persons, plus competition rules and horizontal areas related to the four freedoms to ensure harmonised legislation in the EEA.

To underpin the development of the Internal Market, the EU has established programmes and actions to strengthen cooperation outside the four freedoms. In these areas, "soft" instruments are applied, usually in the form of project funding and studies. The EEA Agreement covers such cooperation, thereby extending these EU programmes to the EEA EFTA States.

The fourth EFTA State, Switzerland, is not part of the EEA but negotiates separate agreements with the EU for each programme in which it participates.

Article 78 of the EEA Agreement calls for the EU and the EEA EFTA States to strengthen and broaden their cooperation in the framework of the Community's activities outside the four freedoms in ten specific fields:

• Research and technological development
• Information services and security of information systems
• Environment
• Education, training and youth
• Social policy
• Consumer protection
• Enterprise, entrepreneurship and small and medium-sized enterprises
• Tourism
• The audiovisual sector
• Civil protection

Cooperation in these fields is defined in separate articles of Protocol 31 of the EEA Agreement. Article 87 of the Agreement, however, permits cooperation to be broadened even further, "where such cooperation is considered likely to contribute to the attainment of the objectives of the Agreement, or is otherwise deemed […] to be of mutual interest".

Other articles have therefore been added to Protocol 31. These cover the following fields:

• Trade facilitation
• Transport and mobility
• Culture
• Energy programmes and environment-related energy activities
• Employment
• Public health
• Telematic interchange of data
• Exchange between administrations of national officials
• Reduction of economic and social disparities

The different articles of Protocol 31 give detailed information on exactly which EU programmes have been extended to the EEA EFTA States. Whenever the EU adopts a new programme in any of the fields above, the decision, in principle, often provides for EEA EFTA participation.

To enable such participation, a specific decision must be taken by the EEA Joint Committee to allow for a reference to the adopted EU programme to be inserted into Protocol 31. Although this may sound simple, the legal procedures involved consist of many steps and can take between three and six months to be completed. For this reason, EEA EFTA participation is often only formally established some time after the start of an EU programme. Flexible arrangements may be found, however, to enable EEA EFTA partners to take part in early calls for proposals for a new programme, for example.

EU programmes and activities that fall outside the objectives of the EEA Agreement are normally not open to EEA EFTA participation. In some cases, the distinction may not be clear, and as Article 87 of the Agreement also allows for new fields to be considered, the question of EEA relevance can sometimes only be solved through specific negotiations.

The EEA Agreement does not oblige the EEA EFTA States to participate in EU programmes that fall under the above fields. For each relevant programme, the EEA EFTA States must submit a request to the EU for formal participation, in accordance with Article 79 of the Agreement. The number of programmes included from the start of the Agreement in 1994, however, shows that the intention on both sides has been to incorporate the most major relevant programmes into the EEA Agreement.

EEA EFTA participation in 15 EU programmes and actions in 1994 was gradually extended to cover more than 30 programmes in 2002. Since 2007, many of these programmes have been merged into fewer and larger programmes.

Through the EEA Financial Mechanism and the Norwegian Financial Mechanism, the three EEA EFTA States - Iceland, Liechtenstein and Norway - contribute to the reduction of social and economic disparities in Europe, and support new EU Member States in their efforts to participate fully in the enlarged Internal Market. The establishment of the financial mechanisms was agreed with the EU in the lead-up to the 2004 and 2007 enlargements of the EU, which entailed an enlargement of the EEA with 12 countries. Through these mechanisms, a wide range of public authorities and institutions, organisations and businesses in the beneficiary states are eligible for grant support to realise projects. These mechanisms will make more than EUR 300 million available annually to support projects in a wide range of priority sectors linked to EU programmes, such as research, cultural heritage, sustainable development, health and childcare.

All EU programmes are different. What follows therefore only aims to highlight some general ideas and tips on how to get started.

Most programmes are operated through the use of projects. The EU supports programmes and projects to strengthen development within different sectors in society. Given that the funding is made available at European level, the project needs to have a European dimension – an explicit European purpose which gives the project a European added value. However, the way in which the European dimension is specified varies between the different programmes. Often, the European Commission also requires that the results of the project have relevance even outside the countries included in the project.

EU financing usually covers less than 75% of the total cost of a project. The rest often comes from national funds, private sponsors or even own resources, such as support staff and office resources. This support needs to be documented.

The key providers of information on EU programmes in EFTA States are the contact points in the Member States and the European Commission. These contact points often organise courses and seminars on how to apply and how to manage projects. They often provide potential applicants with programme user guides in the EFTA languages. Potential applicants can also use the EFTA contact points and the regional EU offices in Brussels for information and support on the application process. For the EFTA and EU contact points for the different programmes, please see the contact boxes on the right of the programme pages.

An EU project can take many forms. Typically, a project is carried out by consortia with participants from different countries that aim at increasing mobility, developing new knowledge or strenthening European dimensions. The size, scope and internal organisation of projects can vary from field to field and from topic to topic.

Increasingly, consortia are forming larger EU project networks. Here, a number of organisations combine their activities in a given field. Implementation of these activities usually requires the consortia to formally commit their resources and activities to the network.

An EU project can also be set up to coordinate or support activities and policies (networking, exchanges, transnational access to infrastructures, studies, conferences etc).

Individual projects are also possible. Here, a project is set up to support other projects carried out by individual national or transnational teams.

Projects can also be set up to support the training of network and agency staff.

Most EU projects require at least two partners in different countries. Finding a good project consortium is a crucial part of the application process. Sourcing partners from existing networks, or from already completed or ongoing projects, often makes the partner search quicker and cooperation easier. Through databases available on Commission websites, applicants can find lists of previous projects and overviews of partners available. The national contact points in the EFTA countries can also support this partner search.

It is important to make sure that all partners have a genuine interest in the project, as they often work together for several years. The project consortium is often formalised through an agreement. It governs the internal organisation of the consortium, the distribution of funds, dissemination and use of projet results, including intellectual property right arrangements, and settlement of internal disputes.

Successful projects usually consist of some experienced and some new partners. Typically, the project coordinator is an organisation, body or enterprise with previous EU project experience.

The European Commission is helpful and responsive to questions which may arise ahead of the application deadline. The Commission often sets up helpdesks ("clinics") to answer questions on applications and support the partner search whilst the call is open.

Once EU has decided to launch a programme, the EU Official Journal publishes a call for proposals. All calls for proposals within EU programmes can be found in this journal.  Other publication channels also often spread this information. The call is usually launched at specific information meetings, often organised by the Commission in Brussels or Luxembourg. These meetings are highly valuable for a better understanding of what the Commission is looking for.

The Europa website gives the best overview of open calls. The information is organised by the directorate-general responsible for the programme in question. This is where the objective of the call, the criteria for funding and the formal application requirements are found. The call is usually open from four to 12 weeks.

Sometimes the call is left "open", which means that funding can be applied for continuously (with fixed selection dates).

The application is sent directly to the European Commission or the executive agencies in Brussels or Luxembourg. For some of the programmes, however, national agencies manage the entire application process. This is the case for decentralised actions under the Lifelong Learning and Youth in Action Programmes.

Application forms are available online, through the websites of the national contact point or the Commission.

Before applying for EU funds, it is important to have a clear idea of what the project aims to accomplish and ensure that all partners in the project are fully aware and supportive. The project idea needs to be checked against the programme's objective and all the formal call criteria. The European added value should be explicit at a very early stage of the process and should include a clear objective for the distribution of the project results after the project has been completed. Making a budget for the project is time-consuming as it needs to be realistic and coherent even at an early stage.

Writing an application includes the following basic elements:

• The idea, objectives and target group should be carefully defined. What is unique in this project? What is the main innovation compared to what is already available? What does the project want to do, and for whom, how and when does it want to do it? Which needs does the project respond to?
• A clear target hierarchy should be established, with quantity measures of resources and the time needed to carry out the project.
• What methods and techniques will the project use to obtain its objective? In larger projects, it is important to use a work package structure to describe the different stages of the project. In all proposals, it is important to be clear about milestones and objectives, including timelines, throughout the project.
• The application usually describes each project partner in detail, how each partner contributes to the project objective and how the partners cooperate. Here again, the European added value should be emphasised.
• Information, dissemination and exploitation of project results is an integral part of an application. How, who and when will the project inform?
• Realistic budgeting is an essential part of any successful EU project.

EU financing is usually based on three types of grants: reimbursement of eligible costs, lump sums or flat rate financing. These may be used to cover the entire EU financial contribution for a funding scheme or more than one may be combined. For most programmes, reimbursement of eligible costs is the preferred method. However, lump sums and flat rate financing will be used more extensively in the new programmes.

When a project starts, its coordinator usually reports the costs and the results to the Commission on an annual or biannual basis. Based on this, the Commission conducts regular reviews of the project, to ensure that it is following its objectives and the formal criteria for funding.

It is also crucial to submit the application on time. Often, excellent applications are deemed ineligible due to avoidable mistakes or late arrival.

EEA EFTA participation in a given EU programme is possible if the three EEA EFTA States agree to it. The legal basis for participation is then established through a decision of the EEA Joint Committee. When agreeing to incorporate programmes into the EEA Agreement, the EEA EFTA States also commit themselves to paying an annual financial contribution into the EU budget.

This annual financial contribution is presented in the EEA annex of the Commission’s section of the EU general budget. Within EFTA, this financial contribution is often referred to as the EEA EFTA budget. As an integrated part of the financing of their participation in EU programmes, the EEA EFTA States also second a certain number of national experts to work in the European Commission.

Switzerland participates in certain EU programmes and seconds national experts to the Commission on a bilateral basis.

The principles underlying the establishment of the EEA EFTA budget are set out in Article 82 and Protocol 32 of the EEA Agreement. In the substructure of the EFTA Standing Committee, the Working Group on Budgetary Matters is responsible for coordinating the procedure establishing the budget in cooperation with the Commission. It also audits and controls the final EEA EFTA budget.

There are two kinds of EU expenditure that the EEA EFTA States contribute to: operational and administrative. The EU operational expenditure is the total EU programme budget less the administrative expenditure. EEA EFTA contributions to the operational costs of the EU programmes are calculated according to Article 82.1 of the EEA Agreement. A proportionality factor based on the relative size of the gross domestic product (GDP) figures of the EEA EFTA States, compared to the total GDP of the EEA, is calculated every year on the basis of the latest available statistical data. The annual EEA EFTA financial contribution to operational costs is reached by multiplying the proportionality factor with the amount of the relevant EU budget line. In 2014, the proportionality factor is 3.03%. The contribution to the EU operational costs represents the major part of the EEA EFTA budget.

In addition to contributing to the EU's operational expenditure, the EEA EFTA States contribute to the administrative costs of the European Commission. This contribution is negotiated individually for each programme on an annual basis. The administrative cost contribution is both financial and in kind. The financial cost contribution is towards the fixed overhead costs of the Commission, such as rental of offices. It is also towards expenses of missions, meetings and publications directly linked to EEA EFTA participation in a given programme. The in kind contribution refers to the EEA EFTA States’ supply of human resources to the European Commission through the secondment of national experts. These experts are employed in the different directorates-general of the European Commission in charge of the programmes with EEA EFTA participation. These experts are cost-free for the European Commission as their salary and benefits are covered by their employer in their home countries. FP7 is an exception to this arrangement as its budget also covers all administrative costs. There is therefore no need for any additional in kind contribution from the EEA EFTA States.

The EEA EFTA budget, like the EU budget, contains two types of appropriations: commitments and payments. The commitment amount of an EU programme is the ceiling decided by the EU budgetary authority (European Parliament and Council). Within this financial envelope, the European Commission has a mandate to sign contracts and thereby commit the EU to pay out programme funds to project applicants. The total commitment amount is decided for a multiannual period and is broken down into yearly commitment amounts. As the implementation period of each project is multiannual, the committed funds are not paid out in full the year of signature but spread over several years. It goes without saying that yearly commitments and payments within one programme differ.

An important principle of EEA EFTA contributions to the EU budget is that they are additional to the EU budget. This means that these contributions are not included in the total EU budget based on the EU Member States' gross national income (GNI), but rather, added to it. The result of EEA EFTA participation is hence an increase of the programme funds compared to the initial amount in the EU decision for the activity in question. On this basis, stakeholders from the EEA EFTA States participate on an equal footing with stakeholders from the EU Member States in the competition for funds. The system is based on solidarity and not on "fair return" or national quotas.

Please read more on the EFTA National Experts page.