Division GENERAL PURPOSEF1

This document addresses the rules to ensure a consistent verification of:

• the legal existence;

• the FP7 status;

• the operational capacity; and

• the financial capacity

of an FP7 participant in order to ensure the implementation of an indirect action (achievement of the expected objectives and results) and the protection of the financial interests of the Union.

The following guiding principles, developed over successive meetings of a working group involving all Research Directorates-General and based on a strong will of simplification and rationalisation, underlie the approach adopted by the Commission:

• Only information that is strictly required by the FP7 RP and/or the FR and/or its IR or for the provision of essential statistics (Commission Annual Activity Report – cf Article 190 TFEU) will be requested from the applicants/participants.

• The Research Participant Portal (http://ec.europa.eu/research/participants/portal) facilitates the participation of legal entities in subsequent FP7 proposals. Through the Research Participant Portal legal entities have to provide their basic data and official documents only once. However, they will be obliged to inform the validation services, also via the Participant Portal, of any modifications.

• Each validated legal entity must appoint one person, a Legal Entity Appointed Representative (LEAR), who is authorised to manage online the legal and financial information of the legal entity via the Research Participant Portal.

• Information requested at proposal stage will not be asked again during negotiations or that information that e.g. needs to be verified at grant agreement stage is not requested at proposal stage, unless it is obvious that the information provided is no longer up to date at the time of verification.

• The verification will as much as possible rely on the self-declaration and auto-verification by applicants/participants. For this to happen the Commission will ensure that they have access to clear information/instructions and any tools they need (e.g. to assess themselves their financial viability). The results delivered by such tools provide non-binding indications; they do not pre-empt the results of a formal financial viability check by the services implementing FP7. Irregularities and/or false declarations may lead to the application of financial penalties or administrative penalties in the form of exclusion of the applicants/participants for future participation.

• While the legal and operational verification has to be performed for each entity, not all entities are subject to financial capacity verification. Section 3.3 which includes a ‘Decision Tree on Financial Capacity Verification’ gives detailed information on the conditions that lead to a verification of the financial capacity of an entity.

• Due to the introduction of a Participants' Guarantee Fund (PGF), no additional financial guarantee or security will be requested from participants or imposed on them, such as reduction of pre-financing for a particular participant, trust accounts, blocked accounts, financial guarantees, etc. The services implementing FP7 will however strengthen ex-post controls to ensure the good implementation of FP7 indirect actions and protect the financial interests of the participants and of the Union.