Traditionally, the European Commission does not impose strict regulations on how and when a research project’s results should be disseminated and/or commercially exploited. In line with that, the EC does not interfere with knowledge transfer activities aiming at commercial exploitation of specific project outcomes, normally done by Knowledge and Technology Transfer Offices (KTO & TTO) in academic institutions. However, when it comes to the EIC Pathfinder and the EIC Transition grants, the European Innovation Council (EIC) has decided to adopt a different approach by introducing additional provisions, which refer also to Intellectual Property (IP), that are a set of new definitions and obligations to facilitate these processes more efficiently. Their aim is to motivate and push forward the exploitation of results of EIC-funded projects, and by that, maximize the overall impact of these projects.
On a first read, these new provisions may seem to be too rigid and to some extent even too artificial. This means that implementing them can be a real unwanted burden for beneficiaries, especially those who are non-profit organizations, namely universities and their Knowledge and Technology Transfer Offices (KTOs & TTOs). However, a closer reading discerns that for each of the new provisions there is a clear set of logical and legal exceptions. This means that there is a rather simple and logical ‘way out’ from these new provisions, as long as there is a good justification for this.
If you are considering applying for funding from these EIC grants, we highly recommend paying attention to these provisions. In this article, we will explain what these provisions are, who they may be relevant to, how and when to work with them, and what are the circumstances in which exceptions may take place.
Disclaimer: this article does not substitute for the official documentation of this subject, as presented in the EIC Work program 2023 Annex 6, and in the Model Grant Agreement. It also does not refer to the EIC Accelerator grant.
Overview of the new provisions
The new provisions set for the EIC Pathfinder and EIC Transition grants intend to reinforce, structure and streamline the dissemination and exploitation activities so they comply with the main EIC innovation agenda and maximize the impact achieved from these grants. They introduce three “tools” for implementing this:
- Exchange of information (with the aim of enhancing exploitation of results, within the context of the new “EIC portfolio” concept)
- Securing the position and privileges of the “EIC Inventors”. These are the individuals that have directly contributed to the research which is the subject of the EIC Pathfinder or Transition project.
- Closer involvement and monitoring of dissemination and exploitation by the EIC, e.g., by EIC Programme Managers, among other means.
The implementation of these new ‘tools’ requires revisiting and amending the rules of granting access rights to project’s results. The new provisions address this issue in an explicit manner, as we describe below in the dedicated chapter “New IP Provisions – access aights” at the end of this article.
With a better understanding of the essence and the goals of these new provisions, let’s begin to understand how they work.
Tool #1 – Exchange of information
As stated above, the EIC aims to motivate the exploitation of project results and maximize opportunities for innovation stemming from these project results. One of the ways they hope to achieve this is by implementing the “EIC portfolios” approach and by proactively promoting corresponding dissemination and exploitation activities.
An “EIC portfolio” clusters individual projects operating in a specific scientific and/or technological area. Research projects funded under EIC Pathfinder and Transition Challenges are automatically added to the challenge portfolio, and research projects funded under EIC Pathfinder and Transition Open calls may be requested to join one or more of the thematic/challenges portfolios.
Projects within a specific portfolio are then expected to interact with each other with the overall goal of maximizing impact, by formal means of information exchange that stimulates cross-fertilization and nurtures market-creation actions. According to the new provisions, all communications between EIC awardees, projects and program managers should be done via the “EIC Marketplace”.
Naturally, such exchange of information for the purpose of enhancing exploitation activities may require granting access rights. We will touch on this topic further under the section “New IP provisions – access rights”.
Tool #2 – Introducing the “EIC Inventors” concept and its implications
As part of the new provisions, the EIC has established a new status named “EIC Inventors” and defined the terms by which such “EIC Inventors” should be granted access to project results for the purpose of their exploitation and dissemination.
In addition to the broader reference to access rights under the new provisions (as we describe in the dedicated section below), it is also important to be aware of the new distinction made by these new provisions. Essentially, these new provisions distinguish between the institutions, which are beneficiaries to the EIC Pathfinder or Transition grant (“EIC awardees”); and the individuals, which contributed to the creation of the intellectual property (IP) that led to the EIC Pathfinder or Transition grant. These individuals are henceforth referred to as the EIC Inventors. The new provisions state that EIC Inventors should be granted sufficient indefinite access rights so they may further use – and assist in boosting the exploitation of – the research project’s results. This will further amplify their project’s overall impact.
Let’s look deeper into the motivation for this new distinction and provisions.
We know how to define the trivial group of individuals which are part of the EIC Pathfinder or Transition project’s team(s). This group of individuals has access to the project’s results, and are probably directly involved in the project’s exploitation activities. That being said, it is possible that there exist additional individual(s) who took part in the preliminary work that led to the innovation developed in the project, but are now no longer part of the funded research project’s team. Classic examples are PhD students or postdocs who participated in generating the preliminary results that eventually led to the development of the EIC research project, but have since moved to another lab , the PhD was completed, and so on…
Before these new provisions were introduced, individuals from the second group defined above had no access rights to the findings and outcomes generated in the funded research project, despite the fact they had a significant contribution during the preliminary findings stage. The new provisions aim to change this exact situation.
In line with the above, to officially qualify as EIC Inventors, these individual researchers:
- should be employed or subcontracted by a beneficiary to the EIC grant who is a non-for-profit legal entity established in a Member States or Associated Country;
- have actively taken part in producing the results at stake and;
- are entitled to appear on a publication of these results and/or in an IP registration mechanism such as patent filing.
Going back to the aim of the new provisions: Importantly, granting indefinite access rights to these “EIC Inventors” may happen only if their idea or plan to exploit does not hinder the exploitation plan already agreed upon between the EIC officials and the EIC awardee of the EIC Pathfinder or EIC Transition grant. The only aim is to multiply the opportunities of exploitation of the EIC results in order to reach impact and they are designed to work in tandem with effective university policies on IPR and knowledge & technology transfer. These access rights do not mean there is transfer of ownership and the EIC awardee will retain priority of exploitation. The new provisions may also allow for royalty sharing with the EIC Inventors in some cases.
Implications of the “EIC Inventors” concept
Opening the door for EIC Inventors by granting them access rights is a game changer. Let’s explain why.
It is rather common that for non-for-profit legal entities, commercial exploitation is not always top-priority. Granting EIC inventors with access rights, whether they are part of the EIC project team or not, may put pressure on the EIC awardees (the institutions) and motivate them to invest more efforts in exploitation. Parallel to that the EIC Inventors can do so themselves and multiply exploitation opportunities.
Although it may carry an additional burden for the universities’ KTOs or TTOs, the fact that EIC Inventors can participate and lead additional exploitation activities carries great impact potential, which we cannot overlook.
That being said, it is important to highlight that the EIC Inventor concept seems to be underdeveloped. Available information sources (the Model Grant Agreement, Annex 6 of the EIC 2023 Work programme, the EIC website and FAQ) do not present fully coherent & consistent definitions and terms related to this new EIC Inventor concept and its provisions. Note that the EIC FAQ provides clearer information when compared to the Model Grant Agreement and the EIC Work Program, but you should keep in mind that in contrast to them, the EIC FAQ is not a binding document. We hope that in the future, the EIC will provide a clearer presentation of this concept and related terms.
Here is a list of main unclarities regarding the EIC Inventors:
- The ‘EIC Inventor’ is supposed to be employed (or subcontracted) by the non-profit organization (e.g., the university) participating in the EIC project. Normally such employees (or subcontractors) are already bound by local legal regulations and obligations regarding IP issues within the non-profit organization. Therefore, it is unclear how the provisions will interact with such internal IP regulations and agreements.
- The timeline of the relation between the EIC Inventors and the EIC Awardee and its relation to the timeline of the project is not defined, hence unclear. For example, it is unclear what happens in case the employment contract does not overlap with the full duration of the grant, or if the EIC Inventor employment was terminated before the EIC project even started. This may lead to many questions and legal complications stemming from timeline gaps of the exploitation activities by the EIC inventor.
- The provisions do not refer to scenarios where the EIC Inventor has left the EIC awardee (institution) during or after the implementation of the action. For example, will an EIC Inventor still be entitled to access rights if they left the EIC Awardee? And what will be the consequences of moving from a non-profit organization to a for-profit organization in terms of the EIC Inventor’s access rights?
- The EIC inventors may get access rights due to their preliminary work that led to the project, but is there a time limit to how far back these works can be considered as eligible for granting the ‘EIC Inventor’ status and the associated access rights?
- And on the other hand, the granted access rights are defined as ‘indefinite’, but is it really indefinite? Are there no limitations at all to that? In relation to the project’s duration? What happens long after the project ends? How ‘indefinite’ is indeed indefinite’?
- Can EIC Inventors have access rights to any other EIC project in the EIC portfolio, assuming that the non-profit organization that employs the EIC Inventor does not participate in these projects?
Tool #3 – Proactive management of dissemination and exploitation by the EIC
Complementing the two tools listed above, the third tool focuses on a more comprehensive monitoring of dissemination and exploitation of results. The activities under this third tool may also be subject to the new access rights provisions, as detailed in the following dedicated section – “New IP provisions – Access rights”.
Closer monitoring of dissemination and exploitation activities
The provisions outline several conditions, obligations and terms which essentially increase the role of the EIC in monitoring and ensuring a streamlined dissemination and exploitation of the project’s results:
Plan for exploitation and dissemination
On top of the regular requirements set out in the Model Grant Agreement (MGA), EIC Awardees are also required to report and update the dissemination and exploitation plan on a regular basis and/or within 30 days upon request from the EIC Program Manager, and for up to four years after the end of the action.
The dissemination activities plan must be approved by the EIC. This means that any dissemination activity may have to comply with any of the following conditions (or a combination of them) set by the EIC for that matter:
- The prior assessment of any innovation potential of the results to be disseminated;
- The prior protection of the result to be disseminated
- The simultaneous unrestricted dissemination through the EIC Marketplace.
In case the EIC does not agree upon a dissemination activity (which may not comply with the conditions presented above), the EIC will actively assist the EIC awardees to change the activity in a way that will comply with these conditions. In such a case, the EIC can potentially propose complementary EIC support or EIC Business Acceleration Services.
In addition to the above, the EIC Program Manager may request participation in EIC Portfolio activities (such as conferences, workshops, EIC Portfolio or networks meetings, experience- and data-sharing activities, etc.)
Exploitation of results
The following three terms concerning the exploitation of results under EIC grants must be followed:
- EIC Awardees must use their best efforts to exploit their results or have them exploited by a third party.
- EIC Inventors (as discussed above) will have the necessary royalty-free indefinite access rights to the results for the purpose of further development and exploitation, unless the EIC Awardee provides support to the EIC inventor to exploit the results. The EIC Inventor must inform the EIC Awardee in due time before any exploitation activity they intend to undertake, and report to it on the implementation. If the EIC Awardee considers that the exploitation activity could negatively affect its own exploitation activities, it may directly suspend these access rights of the EIC Inventor.
- EIC Awardees must report on any exploitation activity on both periodic basis and on-demand basis.
Failure to exploit or disseminate
In case the EIC Awardee fails to exploit or disseminate the project’s results, the EIC may take on such tasks instead. In severe cases, the EIC may also impose penalties on the EIC Awardee.
New IP provisions – Access rights
As detailed above, the new provisions require more flexible and convenient access to project’s results stemming from the work done in the scope of EIC Pathfinder or EIC Transition grants. This flexibility can carry some complexity. While sharing information is key in innovative scientific work and essential for exploitation activities, researchers (and KTOs & TTOs) are oftentimes concerned about how and when to publish and/or provide access to their preliminary findings and/or results, due to Intellectual Property Rights considerations. In order to both mitigate this complexity and maintain the interest of achieving innovation and impact, the EIC has established guidelines regarding how and when access can be granted to preliminary findings and/or results that were reached in the scope of an EIC Pathfinder or Transition project.
The basic rule: the EIC Program Manager (the relevant official EC representative in charge of a group of EIC projects) can request the EIC awardee to provide access to preliminary findings and/or results (generated by the EIC project) via the EIC Marketplace (in which the entire communication of the EIC community is managed). The EIC Awardee should grant these access rights, subject to the following rules:
- Preliminary findings and/or results generated by the EIC Pathfinder or Transition project which were not disseminated or protected yet, are considered to be confidential and the sharing of this information will be limited to:
- Other EIC awardees bound by an EIC grant agreement or an EIC contract (from the same or other EIC project)
- EIC Inventors who signed a non-disclosure agreement (NDA)
- Other members of the EIC Community established in a Member State or an Associated Country and having signed a non-disclosure agreement (NDA)
- Despite the above, an EIC Awardee may refuse access to such confidential information based on one of the following arguments:
- Committing to either publish, patent or protect by any other intellectual property right and without unreasonable delays, or
- Demonstrating concrete exploitation of the said preliminary findings and results, subject to agreement with the EC, or
- Its legitimate interests, including commercial exploitation and any other constraints, such as data protection rules, privacy, confidentiality, trade secrets, union competitive interests, security rules or intellectual property rights.
- Granting access rights does not override or prejudice ownership of results or rights and obligations to protect results and/or relevant personal data.
In this context, we wish to remind that it is recommended to both clarify all intellectual property issues before the grant is signed, and to cover these clearly in the consortium agreement (including ownership and co-ownership of results, consortium-internal approval processes for the dissemination of results, pre-existing technologies, appropriate licensing agreements for background, etc.)
Concluding statements regarding the new provisions
We hope this article is helpful in acquiring a better understanding of the latest EIC provisions for EIC Pathfinder and EIC Transition grants, in terms of how they work, the various parties affected by them, and the possible situations that may lead to exceptions of these provisions. Since these latest provisions are still quite early-stage, we are sure that more discussions are yet to follow regarding their ongoing applications. Therefore, it is important to remember the overarching fundamental goal of these provisions – to push forward the dissemination and exploitation of results of EIC-funded projects in order to maximize their overall impact. In this context, it is our position that once we overcome the ‘growing pains’ and adjust to these new provisions, they will in fact lead to better-streamlined dissemination and exploitation activities. These, in turn, will ultimately help amplify the impact of EIC-funded projects. That being said, we know there will be many cases where it will be rather easy to avoid implementation of the provisions, provided justified reason to do so. Moving forward, should you need any further assistance with these additional IP provisions, or any other aspects of your upcoming EIC research application, we invite you to reach out to us for assistance.