Scottish Funding Council

Horizon 2020 SME Engagement Scheme

Frequently Asked Questions

These frequently asked questions are designed to give an overview of the Horizon 2020 SME
Engagement Scheme, establish if your company is eligible and help with completing an
application form.

We recommend that you read through these FAQs before filling out the application form.

The Bigger Picture - What is Horizon 2020?

Horizon 2020 is a €70 billion European funding programme which supports research and
innovation and drives the creation of new growth and jobs in Europe. The programme aims
to combine the current Framework Programmes for Research and Technical Development,
the innovation related activities of the Competitiveness and Innovation Framework
Programme (CIP) and the European Institute of Innovation and Technology (EIT).

Support for Research and Innovation under Horizon 2020 aims to:
 Strengthen the EU’s position in science by boosting top level research in Europe and
increasing funding for the European Research Council
 Strengthen industrial leadership in innovation through major investment in key
technologies, greater access to capital and support for Scottish small and medium sized
companies.
 Address major societal challenges such as climate change, developing sustainable
transport and mobility, making renewable energy more affordable, ensuring food
safety and security, and coping with the challenges of an ageing population by bridging
the gap between research and the marketplace.

Horizon 2020 presents new opportunities for international co-operation and cross
collaboration across Member States and is complemented by measures to complete and
further develop the European Research Area. All of these measures are aimed at breaking
down barriers to create a genuine single market for knowledge, research and innovation.
Horizon 2020 presents a significant opportunity for companies throughout Scotland.

Horizon 2020 is divided into three main areas although specific details can be found here.

 Excellent science
 Competitive industries
 Tackling societal challenges

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What is the Horizon 2020 SME Engagement Scheme?

The Horizon 2020 SME Engagement Scheme is designed to encourage Scottish based small to
medium sized companies, (companies with less than 250 employees) to explore opportunities
and help them with preparatory activities prior to applying for Horizon 2020 funding. It is
recommended that the Horizon 2020 SME Engagement Scheme is accessed at least 6 months
prior to a Horizon 2020 application date. The value of the award can be up to £5,000, which
will help towards company costs such as fact finding, travel to meet with potential partners,
administration support and use of Scottish university expertise.

This award is an initial step on the “journey of engagement” for the company to access Horizon
2020 funds, with other agencies likely to provide additional support if the Horizon 2020
application is successful e.g. negotiation of contracts.

Key principles

 The purpose of the scheme is to encourage Scottish small to medium sized

companies to engage more effectively with European Funding, under Horizon 2020.
 Academics or European officers within Scottish universities can offer expertise and
experience to advise and facilitate appropriate consortium building and support
towards full Horizon 2020 application for the company.
 The award will be paid to the university on submission of a completed final report
and university costs will be reimbursed by the SFC (please note the award will not be
paid to the company nor will any in-kind costs be reimbursed.)

Who can apply?

Scottish small and medium sized companies (SME)

All SMEs as set out by the European Commission (including third sectors/social enterprises)
with main business operations in Scotland are eligible to partner with a Scottish university
under the Horizon 2020 SME Engagement scheme. By SME we refer to organisations that are
registered companies, employ between 1- 250 employees and have an annual turnover not
exceeding 50 million euro.

If your company is not registered in Scotland (does not have a registration number starting
with SC) you need to complete a pre-submission form to check eligibility.

There are options available for Scottish companies to ‘pool’ awards e.g. multiple companies
working with one or more academic partners in developing the same Horizon 2020
application. Contact applications@interface-online.org.uk for more information.

Spin Out Company

If your company is a spin out company from a university you need to complete a spin-out pre-
submission form before proceeding to a full application as you may not be eligible.

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Sole Traders
While sole traders are not excluded from this scheme, it will be necessary, as in all
applications, to outline the credibility of their future Horizon 2020 application. Historical
evidence suggests that sole traders are not generally awarded EU funds as they are deemed
to have insufficient capacity to successfully participate in the programmes and deliver
projects to the benefit of Europe.

If in doubt about the eligibility of the company, please seek further clarification from Interface
prior to preparing a submission from applications@interface-online.org.uk.

Can a company apply for more than one Horizon 2020 SME Engagement
Award?

Companies, in conjunction with a university partner, can apply for more than one Horizon
2020 SME Engagement award. Please note that the university must be the lead applicant.
However, only one application by the Company can be “live” and on-going at any point in time,
i.e. a satisfactory final report must have been submitted from a previous Horizon 2020 SME
Engagement award prior to a new application for funds being submitted.

What will be funded?

The Horizon 2020 SME Engagement award, for an individual programme of work towards an
identified Horizon 2020 application, is between £1,000 and £5,000. It will be paid upon
approval of a final report submitted by the supporting university (sent to
applications@interface-online.org.uk) and approved by the Scottish Funding Council. The
company is expected to match the grant contribution with an in kind contribution only, such
as time, resources etc.

It is anticipated that applications to this scheme will be submitted around 6 months in advance
of a Horizon 2020 call closing date. This will ensure sufficient time is allotted to scope the
application and support the company engagement during the period leading up to the call
closing. The effectiveness of offering support for programmes of work over considerably
shorter periods will be assessed on a case-by-case basis.

The university supporting the company’s participation should use the application form to set
out the exact costs of activity by both the company and the university (in terms of value for
money, e.g. staff time, advanced purchase standard class travel etc.). The contribution from
the company is an in kind contribution only and these costs will not be reimbursed by the SFC.

SFC would not expect the university to conduct this activity at a loss and they should set out
their rates accordingly. Full economic costing (FEC) will inform this process. Equally, SFC would
expect universities to justify the costs and will look at the proposal with an appropriateness
and value for money test.

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What costs will be funded?
The award will be paid directly to the university and not the company and can only be used
for assistance provided by university staff or any services they have purchased i.e. arranging
travel, accommodation or event tickets for the company.

Eligible costs include:

 Exploratory meetings for the company with partners in the UK or other European
Countries to prepare the Horizon 2020 proposal.
 Travel costs for the company to attend European information days, brokerage events
directly related to the Horizon 2020 objectives, relevant discussions with European
Commission officials or similar (as the grant is paid to the university, the university
should book and pay for this OR the university will reimburse the company).
 University staff time to scope the Horizon 2020 application for the company (setting
the budget, market analysis, advice on proposed feasibility studies, lab visits).
 Due diligence work to identify other collaborative partners e.g. other universities and
companies.
 Participation in training sessions or information about the chosen theme for the Call.
 University administrative time e.g. to arrange meetings, book flights, arrange
accommodation etc. for the company.
 Travel and subsistence – this should be in line with university rules on travel and
subsistence.

A breakdown of all costs for the proposed activities and other associated costs e.g. travel will
be submitted with the final report and invoice. Eligible expenditure should be for activity
explicitly set out in the approved application.

It is the responsibility of the university that the day rates included for staff costs are
appropriate for the skill set / sector. A request to substantiate these rates with evidence of
appropriateness may be made on submission of the application for auditing purposes.

Costs that will NOT be funded

The following activities are not eligible for support in the Horizon 2020 SME Engagement
Scheme:

 Third-party consultancy costs: the support for the company should derive from
university expertise.
 Costs for prospective EU domiciled companies and academic partners to travel to
Scotland for exploratory meetings.
 Academic-only applications: the awards are intended to assist company engagement
with Horizon 2020.
 University travel to attend UK/European meetings – unless reasons are fully justified.
 University input on Horizon 2020 proposal; this scheme can only support company
engagement.
 Standard training courses.
 Software purchases.
 Aid that would promote/ subsidise the cost of exports.

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  Internships for students of knowledge institutions.
 Sales and marketing activities.
 Design and production of advertising materials including websites and mobile
applications if these are to be used for sales and marketing.

Are Horizon 2020 SME Engagement awards subject to VAT?

Whether or not VAT is charged is determined by the university. They decide, according to their
internal process, whether the activities are classified as consultancy (thus incurring VAT) or as
research (not VAT liable).

The general advice from the Scottish Funding Council is that if the VAT can be recovered, by
whatever means by the company, then this is not an eligible cost. If the VAT cannot be
recovered by the company then it can be claimed as an eligible cost provided the claim is
substantiated by appropriate evidence from the company’s auditors or accountants.

Are Horizon 2020 SME Engagement awards considered State aid?

The European Commission has set out rules about state aid given to organisations and
companies, such as Horizon 2020 SME Engagement awards. It is important that companies, as
recipients of state aid, comply with the legislation.

State aid, often in the form of financial assistance, given to companies from a public body, can
give a competitive advantage and therefore has the potential to distort industry competition
and affect trade between member states of the European Union.

De minimis aid is the term used for small amounts of state aid that do not require European
Commission approval. Horizon 2020 SME Engagement awards are considered de minimis
payments. There are limits on the amount of de minimis payments made to a single recipient
(€200,000 over any 3 fiscal years). It is the company applicant’s responsibility to make sure
the EU limits have not been exceeded. The company should make their university partner
aware of any de minimis aid they have received over the last three years from any source.

For the purposes of the de minimis regulation, the Horizon 2020 SME Engagement award
confirmation must be retained for a minimum of three years and produced on any request by
the UK public authorities or the European Commission.

Can a company apply if it has no university partner in Scotland?

A company intending to apply to a Horizon 2020 call, either under a call for a single SME
application (e.g. SME instrument) or in a planned consortium with no Scottish university
partner, can still apply for support for exploratory and preparatory activities through the
Horizon 2020 SME Engagement scheme. A Scottish university will be identified to offer
assistance either by the company itself, or with the help of Interface.

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How do I complete the application form?

Once you have chosen an academic partner, set up a meeting with them to discuss; your
business, how the university can assist you with the Horizon 2020 application, how the
university can help you with fact finding activities including assistance with collaboration
meetings and travel arrangements and any necessary contractual arrangements such as
confidentiality, non-disclosure and intellectual property. The sections in the application form
provide a guide to the areas to be discussed during the meeting.

The application form has 3 main sections:

Section A.1. - Company details and declaration. Completed by the company.
Section A.2 – Funding Details. Completed by the university.
Section A.3 – Activity Costs. Completed by the university.

All applications should 'aim at' particular calls under Horizon 2020, these being;
Excellent Science, Competitive Industries and Tackling Societal Challenges. This information
must be included on the application form. Please refer to this link for information.

For guidance on how to complete the form, please follow the step by step guidance notes.

How are applications submitted?

Completed applications are submitted by email from the university to applications@interface-

online.org.uk. Interface will check the application before sending it to the Scottish Funding
Council for review and to make a decision on whether it is eligible to be funded.

The assessors may ask for further information to support the application, request
amendments to the application, decline it, or accept it within 3 weeks of submission.

How will the award/ no award decision be communicated?

The Scottish Funding Council will issue an email confirming their decision to the lead academic
and commercial team contact. It is the responsibility of the university to notify the company
of the decision.

The Scottish Funding Council reserves the right to turn down any application that does not
meet the required criteria or overall purpose of the scheme. SFC may in some cases ask
applicants for further information to clarify applications. SFC is not obliged to enter into a
dialogue with the applying university to explain its decision.

If an application is declined, you may submit a revised application only if the reasons for
rejection are fully addressed. If you do wish to proceed on this basis contact
applications@interface-online.org.uk.

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How long will it take for the application to be approved?

Applications may take up to 3 weeks from submission to Scottish Funding Council to be

approved, provided all the information is correctly completed in the form. If additional
information is needed, then approval timescales will be longer so it is important that you read
the guidance carefully.

How long will my study take?

Horizon 2020 SME Engagement awards are intended to fund short-term programmes of
activity to assist with the preparation leading to a Horizon 2020 application. Both partners
must be realistic in terms of time scales and setting a proposed completion date.

When selecting the start and end dates for the activities related to this study, please take into
consideration the following points:

 3 weeks should be left from submission to approval by SFC (assuming there is sufficient
information in the proposal to assess).
 Please ensure that the timescales for revisions, approvals and holidays have been
taken into account in nominating start and finish dates.
 The closing date of the call for proposals or latest date that the company intends to
complete its application to an open call.
 Agreed programmes of activity should generally be completed no more than 6 months
after the start date.

Can changes be made to the activities or timescales?

Once an award has been approved by the Scottish Funding Council, the university should
contact the company as soon as possible and commence the activities as planned. If, for any
reason, the timescales cannot be met or the objectives change, the university must complete
a change request form as soon as possible and send it to applications@interface-online.org.uk
for approval. Once the grant is approved no changes to the overall activity costs are expected.
If changes are not notified, the Scottish Funding Council is under no obligation to make any
payment towards these costs.

Following the exploration stage, if the company/university decides not to pursue with the
proposed Horizon 2020 application, the monies need not be paid back.

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What happens if a problem arises during the study?

There may be times when a problem or issue arises. We recommended that you initially raise
any concerns with the commercial contact in the university as soon as possible.

If, however, you are still dissatisfied, please contact applications@interface-online.org.uk

giving a brief outline of the reason for your dissatisfaction.

If any issues arise with your chosen university partner, as above, you should discuss this with
the commercial contact within the university. If this requires further escalation, each
university has a formal complaints process that should be followed – this can be found on the
university website.

What happens once the study is complete?

The company and academic team should hold a meeting at the end of the study to review the
results from the fact finding activities and make recommendations with regard to the
proposed Horizon 2020 application.

This meeting should review the activities undertaken by the company, consider the next steps
and compile the information for the final report.

What information is required for the final report?

The final report should be completed by both partners at the close out meeting, confirming
that the fact finding activities took place and share whether or not the study was a success,
the possible impacts and consider the options available to progress to a Horizon 2020
application. The final report should be submitted to applications@interface-online.org.uk.

The final report will help assess the success of the scheme and its impact on the Scottish
economy and may therefore be included in reports to the European funders. It is therefore
important to ensure that all requested information is included. Details on how to complete
the form is in the step by step guide to completing the final report.

The completed original application form (Part A), final report (Part B) and financial report (Part
C) should be submitted to applications@interface-online.org.uk as one document by the
university within 4 weeks of the specified end date. If not, the award may not be paid.

Please ensure that the final report is fully completed to the best of your knowledge and signed
by the university and company (an e-signature is acceptable but not a typed signature).

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How is the award paid?

The grant is paid directly to the university after the final report (Parts B and C of the application
form) is approved by the Scottish Funding Council.

If for any reason the study is terminated before it is completed, a claim can still be made if the
costs exceed £1,000 and the company has matched the contribution in kind. If the claim is less
than £1,000 the company may be asked to pay this directly to the university in accordance
with the Legal Agreement.
Will the outcome from the study be promoted?
All awards are followed up by Interface six months after completion with a survey so we can
evaluate the impact and outcomes of the scheme.

In addition, Interface occasionally includes case studies of successful applications funded by

SFC to promote the scheme on its website and other media. These can be extremely useful
for promoting your company but you can let us know if you do not want a case study
produced.

There may be occasions when a legitimate outcome of this engagement may be that no
further application to Horizon 2020 is submitted by the company. However, if a Horizon 2020
application does transpire, the university should inform applications@interface-online.org.uk
of the outcome from the Horizon 2020 application once the decision has been made.

Our commitment to equality, diversity and environmental sustainability.

The Scottish Funding Council, Interface and universities are committed to promoting equality,
diversity and environmental sustainability (also known as Horizontal Themes).

Further details about the Scottish Funding Council’s equality, diversity and environmental
sustainability policies can be found here.

As vouchers are an award of public funds, there is a duty to ensure that these funds are
reaching the widest possible pool of recipients. All partners may therefore be asked to
complete an anonymous survey in order that evidence can be gathered and recommendations
made to ensure these policies are being met. This survey will be sent separately.

We would also encourage all companies to promote the Scottish Company Pledge, a
partnership between the Scottish Government and companies to commit to shared ambitions
of fairness, equality, diversity and sustainable economic growth through progressive policies.

Privacy Statement

Interface will share personal data collected for facilitating the application for Innovation
Vouchers with the Scottish Funding Council, for more information; please see the respective
privacy statements: Interface, SFC,

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Freedom of Information

The Scottish Funding Council may share information about awards with the Scottish
Government, Scottish Enterprise, Highlands and Islands Enterprise and other appropriate
organisations in the interests of developing and promoting the Horizon 2020 SME Engagement
Scheme.

The Scottish Funding Council is subject to the Freedom of Information (Scotland) Act 2002 and
may be requested to disclose information about the Horizon 2020 SME Engagement Scheme.
Companies and universities will be consulted before any decision to disclose information is
taken. However, refusal to disclose information may be appealed to the Scottish Information
Commissioner.

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