Updated Annotated Model Grant Agreement: Summary of Changes

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All modifications made to the new version of the document are marked with a green square on the left. The symbol indicates either brand new annotations or changes to the existing text (re-arranged paragraphs, harmonised vocabulary, etc.). Furthermore, new rules that apply, in principle, only for grant agreements signed with version 3.0 are clearly marked with the relevant symbol.

The most significant changes made to the General Grant Agreement are as follows:

Article 4.2 'Budget transfers' – following the summer update of the Model Grant Agreement (MGA), the Annotated version now specifies that it is possible to transfer budgets between forms of costs (e.g. actual or unit costs) that had not been foreseen in the initial budget without an amendment, but only within the personnel costs category. The document provides examples of transfers between forms of costs, which are allowed and which are not allowed without an amendment. For example, it is not possible to transfer budgets to the category of specific unit costs allowed in a call (e.g. unit costs for clinical studies or unit costs for energy efficiency measures in buildings) without an amendment, as these do not fall into the personnel cost category.
Article 5.2 'Form of grant, reimbursement rates and forms of costs' – the AMGA clarifies that the reimbursement rate of linked third parties does not depend on the status of the beneficiary to which they are linked, but on the legal status of the linked third parties themselves.
Article 5.3.3 'Step 3 — Reduction due to the no-profit rule' – Further clarifications are provided on what does not constitute a receipt of the action. A practical example of in-kind contributions given by a third party (donor) free of charge when they are not given specifically to be used for the action, is provided.
Article 6.1 'General conditions for costs to be eligible' – the document specifies that personnel costs for ERA chairs are eligible, even if the salary is higher than national salaries.
Article 6.1.1 '1.1 Direct personnel costs: Employees (or equivalent)' –

The definition of an 'equivalent appointing act' is provided.
Clarifications for the treatment of staff provided by a temporary work agency are provided.
Clarifications related to the end-of-contract indemnities that the beneficiaries may charge in the reporting period in which the employee's contract ends – these costs must be claimed separately and on top of the personnel costs declared on the basis of the hourly rate.
Clarifications on the matter of personnel having to be assigned to the Horizon 2020 action for the personnel costs to be eligible. The AMGA now specifies that reliable time records will normally constitute sufficient proof for this requirement.

New monthly method of calculating personnel costs

Following the introduction of the monthly calculations of the hourly rate in the summer update of the MGA, the annotated version now provides clarifications on how the new method works in practice, and how recalculations and adjustments of previously submitted financial statements should be performed.
The AMGA now also explicitly refers to the so-called 'double ceiling' which specifies that beneficiaries must ensure the following when claiming personnel costs:

the total number of hours worked declared in EU and Euratom grants for a person for a financial year is not higher than the number of annual productive hours used for the calculation of the hourly rate; and
the total amount of personnel costs declared (for reimbursement as actual costs) in EU and Euratom grants for a person for a year is not higher than the total personnel costs recorded in the beneficiary's accounts for that person in the respective financial year.

The AMGA confirms that when using the annual hourly rate (based on the 'last closed financial year' option), adjustments are still only allowed in case of genuine mistakes and clerical errors. Other re-calculations of the personnel costs (e.g. due to salary increases) are not allowed when using this calculation method.
Clarifications are provided on the treatment of absences (parental leave, sick leave, etc.) and overtime for the three options of the annual productive hours when calculating the annual hourly rate.
Clarifications are also provided on numerous aspects of the new monthly hourly rate, including the treatment of parts of the basic remuneration generated over a period longer than a month and parental leave, as well as other absences and overtime.

Travel and subsistence costs

Clarifications related to combining project-related travel with personal travel or travel for other purposes – The AMGA now states that costs of such travel can be charged to the action, but only if this is a standard practice of the beneficiary and the cost incurred is not higher than that of travel, which would have been made exclusively for the purposes of the Horizon 2020 project. A practical example is also provided.

Depreciation costs of equipment, infrastructure or other assets

References to the equipment's 'full capacity' have been removed for standard equipment. However, calculating the deprecation costs on the basis of the equipment's 'full capacity' still applies to the specific category of Large Research Infrastructures.
New guidance on the depreciation costs of low-value assets – the AMGA now states that the full cost of a low-value assets may be eligible in the year when it is purchased if:

the full cost is recorded in the accounts of the entity as expenditure of that year (not recorded as an asset subject to depreciation); and
the cost of the asset is below the low-value ceiling as defined under national law (e.g. national tax legislation) or other objective reference compatible with the materiality principle; and
the item is used exclusively for the Horizon 2020 action in the year of purchase. If the item is not used exclusively for the action in the year of purchase, only the portion used on the action may be charged.

Costs of other goods and services and ineligible costs

Following the extension of the Open Research Data Pilot to almost all parts of Horizon 2020, the relevant section of the AMGA now specifies that costs related not only to open access to peer-reviewed scientific publications, but also to research data are eligible, if the basic eligibility conditions are fulfilled. Furthermore, with the explicit agreement by the Commission/Agency, these costs can also include fees levied for a membership scheme (if this is a requirement for publishing in open access or if membership is a pre-condition for significantly lower article processing charges).
Article 6.5 'Ineligible costs' – the AMGA now explicitly mentions duties, the eligibility of which depends on the eligibility of the cost item to which they are linked (in whose price they are included). If the item is eligible, the duty is too.
Article 10 'Purchase of goods, works or services' – clarifications are provided for purchases between beneficiaries, which, in principle, are not accepted. Purchases between beneficiaries will only be accepted by the Commission/Agency in exceptional and properly justified cases.

Other changes

Article 16 'Provision of trans-national or virtual access to research infrastructure' – the AMGA now specifically states that the beneficiaries must ensure that the users comply with the following obligations under the GA: avoiding conflicts of interest, maintaining confidentiality, promoting the action and giving visibility to the EU funding, and liability for damages.
Article 18.1.2 'Records and other documentation to support the costs declared' – Clarifications related to the Certificate on the Methodology (CoMUC). The AMGA now explicitly states that if the beneficiary declares personnel costs according to a changed cost accounting practice before the new certificate is approved, it bears the risk of non-approval and cost rejection by the Commission/Agency.
Article 20.1 'Obligation to submit reports'

The AMGA now explicitly mentions the consequences of non-compliance with the requirement to submit periodic and final reports by the given deadline, including suspending payment deadlines and in extreme cases terminating the GA.
Clarifications related to the security obligations, clearly stating that technical reports may not contain any information that has been EU-classified in Annex 1 of the GA.
Clarifications related to submitting a Certificate on the Financial Statements (CFS) at the end of each reporting period rather than at the end of the project – such costs are eligible if a CFS is mandatory (the threshold is reached at the end of the action) and the total costs of the partial certificates is similar to the cost that would have been incurred for a single certificate.

Article 29.1 'Obligation to disseminate results' – Guidance on complying with the Extended Open Research Data Pilot in Horizon 2020 Work Programme 2017. Participation in the ORD Pilot is therefore now, in principle, the default.
Article 43 'Reduction of the grant' – Explicit references to grant reduction due to substantial errors, irregularities, fraud or breach of obligations.
Article 50.1 'Termination of the Agreement, by the beneficiaries' – Further clarifications on the grounds for GA termination.
Article 50.3 'Termination of the Agreement or the participation of one or more beneficiaries, by the Commission/Agency' – Clarifications and examples of grounds for termination of the GA by the Commission/Agency, including bankruptcy, non-compliance with tax or social security obligations, loss of scientific or technological relevance, or refusal to remove a linked third party.
Article 55 'Amendments to the agreement' – Further clarifications on what does and does not require a formal amendment of the GA.

Outstanding issues not addressed in the updated AMGA

The issue of internal invoicing is not specifically addressed in the updated version of the AMGA. The Commission is planning to introduce an alternative way of claiming costs for internal invoicing soon, but the change will require an official update of the existing version of the Model Grant Agreement (currently version 3.0). Therefore, any annotations on this matter will only be included in the AMGA, after the change MGA has been updated.