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| Costs, Finance, Reporting, Third Party

Can an affiliated company participate in my H2020 project?

Yes, your affiliated company can be involved in the project as a linked third party. However, in order to keep in line with H2020 rules, a few principles need to be kept in mind. First, what is a linked third party (LTP) according to H2020 rules? A LTP is any legal entity that is affiliated or has a legal link to the beneficiary beyond the project.

What are the main principles of the LTP’s participation in the project?

  • The LTP must fulfil the same conditions for participation and funding under H2020 as the beneficiary (first of all, it must be an SME according to the EC definition).
  • The LTP does not sign the Grant Agreement (GA) contract with the European Commission, but is subject to most GA obligations through participation in the project.
  • The LTP itself performs certain project tasks directly and is responsible for them. However the beneficiary always remains responsible towards the European Commission (EC) for the entire project.
  • The LTP costs must be indicated in the Grant Agreement. It can declare its own costs for all budget categories, including indirect costs (at the 25% flat rate).

Finance – what is important?

  • All the costs must be recorded in the accounts of the LTP.
  • The LTP has its own financial statements which will be submitted by the beneficiary.
  • The LTP has to provide its own certificate on financial statements if its costs amount to EUR 325,000 or more.

Other obligations of the LTP – don’t forget!

  • Record-keeping obligations – timesheets are also mandatory for the LTP staff involved in project implementation.
  • Reporting on project progress – the LTP provides input for the technical report.
  • Conflicts of interest – the LTP must avoid conflicts of interest with any contractors or subcontractors involved in the project and maintain confidentiality.
  • Promoting the project and the EU funding also applies to the LPT!

Good practices – contract with the linked third party

In order to fulfill the obligations mentioned above, it is advisable to sign a contract with the linked third party before the project collaboration starts.If you are still unsure how to organise cooperation with your affiliated company within an H2020 project, contact us at [email protected] 

Karolina Czaharyńska