From Horizon 2020 to Horizon Europe – what is new in the DESCA Model Consortium Agreement?
13th January 2022 at 4:04 pm
Have you been invited for grant preparation of your Horizon Europe (Horizon EU) proposal recently? Congratulations on your successful application! Now it’s time to roll up your sleeves and establish the framework for an effective project implementation. Besides various other tasks, the European Commission (EC) requires your consortium to establish a Consortium Agreement to ensure that all project partners have a consortium-internal arrangement regarding their (IP) rights and obligations that are not defined in the EC Grant Agreement. Even though this document is not subject to the approval by the EC, in view of avoiding disputes and ensuring a smooth project implementation, it’s highly recommended that your consortium sets up and negotiates this agreement as soon as possible after the start of the grant preparation.
DESCA: Development of a Simplified Consortium Agreement?
The European Commission offers general guidance for drafting Consortium Agreements but does not provide a specific model Consortium Agreement. However, the so-called DESCA Core Group was brought to life in the 7th EU Framework Programme as an independent initiative and developed the standard Consortium Agreement model used in EU-funded research and innovation projects. The DESCA 2020 used for most Horizon 2020 initiatives has now been updated for Horizon Europe projects.
What is new in the new DESCA Model Consortium Agreement?
The new version of the DESCA Model is the result of a collaboration between a consultation group and the main DESCA core group and is composed of four main subgroups: the General Issues and Liability (GIL), the Governance (GOV), the Finance (FIN) and the Intellectual Property Rights (IPR). The changes to the previous version are summarised in the following table. In this new version, all articles referencing the HEU Model Grant Agreement (MGA) have been updated.
| Overall terminology | • Terminology has been aligned to the new terminology of Horizon Europe (e.g., «Funding Authority» is now «Granting Authority») • «Affiliated entities» have replaced the previous «Linked Third Parties» • “Entities under the same control” have replaced the previous «Affiliated entities» • The term “Participants” is now included and derives from its definition in the MGA • The term “Other Participants” is now included and follows Article 9 of the MGA |
| Section 4: Responsibility of Parties | • Addition of sub-section 4.4 -Specific responsibilities regarding data protection that includes a minimum statement concerning GDPR and conclusion of separate data processing, data sharing and/or joint controller agreements if needed |
| Section 5: Liability towards each other | • Sub-section 5.2 – Limitation of contractual liability – was restructured and reworded, but options for different interests are still provided • Addition of an optional sub-section 5.5 – Export control – to be considered in projects in which import or export is relevant |
| Section 6: Governance structure | • Less complex governance structure: only the Coordinator and General Assembly are defined (the Executive Board may be included in medium to large projects) • An optional sub-section 6.2 called “Members” can be included to provide a clear distinction between Party (the legal entity participating in the project) and Member (the person representing a Party in the General Assembly) • It is suggested for small projects that the General Assembly convenes an ordinary meeting every six months (usually the recommended timings are shorter for smaller projects) • The terms for “Decisions without a meeting” are now described in more detail and the decision may be approved by simple majority of all Parties (rather than the 2/3 majority of all Parties) • The General Assembly may appoint not only Executive Board Members but also External Expert Advisory Board (EEAB) Members • The additional option regarding the EEAB now includes an explicit mandate for the Coordinator to sign non-disclosure agreements on behalf of the consortium (an NDA template is being added as Attachment 5) |
| Section 7: Financial provisions | • Sub-section 7.1.4 – now called “Excess payments” – clarifies in which situations a Party has received excess payment, gives an explicit contractual obligation to pay back the overpayment to the Coordinator and defines the procedure in case the Party is reluctant to do so • Sub-section 7.1.5 is now dedicated to “Revenue” and emphasises that in case a Party earns any revenue that is deductible from the total funding, the other Parties’ financial share of the budget shall not be affected • Regarding sub-section 7.1.6 – Financial Consequences of the termination of the participation of a Party – the General Assembly should agree now on a procedure regarding additional costs which are not covered by the Defaulting Party or the Mutual Insurance Mechanism • It is now suggested that the Coordinator is entitled to recover any payments already paid to a Defaulting Party except the costs already claimed by the Defaulting Party and accepted by the Granting Authority |
| Section 8: Results | • Teaching activities have been added for the use of jointly owned results • Each Party may transfer ownership of its own Results, including its share in jointly owned Results • Dissemination of own Results now includes jointly owned Results and an additional objection ground about Confidential information was added |
| Section 9: Access Rights | • Teaching activities are now considered in the Access Rights to Results • An additional sub-section regarding Specific Software Provisions is also available (especially important for projects involving Access Rights to software) |
| Section 11: Miscellaneous | • Attachment 4 has been renamed to “Identified entities under the same control” and Attachment 5 (NDA for External Expert Advisory Board agreed under Section 6) has been added • Sub-section 11.3 was renamed – now it’s Formal and written notices – and the definition of both notices have been clarified • Court litigation was added as an additional option in sub-section 11.3 – Settlement of disputes – thus complementing the already existing options of WIPO Mediation and ICC Arbitration • Option to add a sub-section 11.9 related to anti-corruption |
In sum, and based on our experience from more than 50 EU projects in which we have been a partner over the years, the differences between the Horizon 2020 and the Horizon Europe DESCA Model are recommended to be followed but are not a “game-changer”.
As it often takes a long time to develop an agreement especially for larger consortia with more than ten project partners, and given that the process of grant preparation typically only takes up to three months, using DESCA as a basis for your Consortium Agreement will most likely remain the gold standard. Please note that the Consortium Agreement must still not contain any provision contrary to the Grant Agreement and costs related to drafting the Consortium Agreement are not eligible because the latter should be signed prior to the project start. So, we do have plenty of reasons to favour this new DESCA Consortium Agreement template!
Support for your grant preparation
We not only offer full support in proposal writing and project management but also in the process in between: the grant preparation. Our team at accelopment has successfully guided dozens of project partners through the grant preparation process already in the FP7, throughout H2020, and now during the latest Horizon EU projects.
Andreia Cruz
Research & Innovation Project Manager