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 firstname.lastname@example.org