Articles for state aid from the Research Council of Norway

The Research Council awards state aid pursuant to the General Block Exemption Regulation for state aid. We use three different articles. The text of the call for proposals in question specifies the article that will be used for the funding.

Articles for support for research and development projects, support for investment in research infrastructure and support for newly established enterprises: 

  • Article 25 provides the article for awarding state aid for research and development projects and is used in calls for Innovation Project and Collaborative and Knowledge-building Project.
  • Article 26 provides the article for awarding state aid for research infrastructure investments, and is used in separate calls for proposals for research infrastructure.
  • Article 22 provides the article for awards of state aid to newly established undertakings and is used in calls for proposals for Commercialisation Project.

Below you will find the articles reproduced in their entirety from the General Block Exemption Regulation (GBER), as well as information about the article in question that it is important that you are aware of. Under the text of Article 25 you will also find information about the declaration form we collect before we can award this type of support.

Article 25 of the General Block Exemption Regulation

Article 25: Aid for research and development projects

1. Aid for research and development projects, including research and development projects having received a Seal of Excellence quality label under the Horizon 2020 or under the Horizon Europe programme and co-funded research and development projects and, where applicable, aid for co-funded Teaming actions, shall be compatible with the internal market within the meaning of Article 107(3) of the Treaty and shall be exempted from the notification requirement of Article 108(3) of the Treaty, provided that the conditions laid down in this Article and in Chapter I are fulfilled.

2. The aided part of the research and development project shall completely fall within one or more of the following categories:

a) fundamental research;
b) industrial research;
c) experimental development;
d) feasibility studies.

3.   The eligible costs of research and development projects shall be allocated to a specific category of research and development and shall be the following:  

a) personnel costs: researchers, technicians and other supporting staff to the extent employed on the project;

b) costs of instruments and equipment to the extent and for the period used for the project. Where such instruments and equipment are not used for their full life for the project, only the depreciation costs corresponding to the life of the project, as calculated on the basis of generally accepted accounting principles are considered as eligible;

c) costs for of buildings and land, to the extent and for the duration period used for the project. With regard to buildings, only the depreciation costs corresponding to the life of the project, as calculated on the basis of generally accepted accounting principles are considered as eligible. For land, costs of commercial transfer or actually incurred capital costs are eligible;

d) costs of contractual research, knowledge and patents bought or licensed from outside sources at arm's length conditions, as well as costs of consultancy and equivalent services used exclusively for the project;

e) additional overheads and other operating expenses, including costs of materials, supplies and similar products, incurred directly as a result of the project; without prejudice to Article 7(1), third sentence, such research and development project costs may alternatively be calculated on the basis of a simplified cost approach in the form of a flat-rate of up to 20 %, applied to total eligible research and development project costs referred to in points (a) to (d). In this case, the research and development project costs used for the calculation of the indirect costs shall be established on the basis of normal accounting practices and shall comprise only eligible research and development project costs referred to in points (a) to (d).

4. The eligible costs for feasibility studies shall be the costs of the study.

5. The aid intensity for each beneficiary shall not exceed:

(a) 100 % of the eligible costs for fundamental research;
(b) 50 % of the eligible costs for industrial research;
(c) 25 % of the eligible costs for experimental development;
(d) 50 % of the eligible costs for feasibility studies.

6. The aid intensities for industrial research and experimental development may be increased up to a maximum aid intensity of 80 % of the eligible costs in accordance with points (a) to (d), where points (b), (c) and (d) must not be combined with each other:

(a) by 10 percentage points for medium-sized enterprises and by 20  percentage point for small enterprises;

(b) by 15 percentage points if one of the following conditions is fulfilled:

(i) the project involves effective collaboration:

      •  between undertakings among which at least one is an SME, or is carried out in at least two Member States, or in a Member State and in a Contracting Party of the EEA Agreement, and no single undertaking bears more than 70 % of the eligible costs, or
      • between an undertaking and one or more research and knowledge-dissemination organisations, where the latter bear at least 10 % of the eligible costs and have the right to publish their own research results;

(ii) the results of the project are widely disseminated through conferences, publication, open access repositories, or free or open source software;

(iii) the beneficiary commits to, on a timely basis, make available licences for research results of aided research and development projects, which are protected by intellectual property rights, at a market price and on non-exclusive and non-discriminatory basis for use by interested parties in the EEA;

(iv) the research and development project is carried out in an assisted region fulfilling the conditions of Article 107(3), point (a), of the Treaty;

(c) by 5 percentage points if the research and development project is carried out in an assisted region fulfilling the conditions of Article 107(3), point (c), of the Treaty;

(d) by 25 percentage points if the research and development project:

(i) has been selected by a Member State following an open call to form part of a project jointly designed by at least three Member States or contracting parties to the EEA Agreement; and

(ii) involves effective collaboration between undertakings in at least two Member States or contracting parties to the EEA Agreement when the beneficiary is a SME, or in at least three Member States or contracting parties to the EEA Agreement when the beneficiary is a large enterprise; and

(iii) if at least one the two following conditions is fulfilled: – the results of the research and development project are widely disseminated in at least three Member States or contracting parties to the EEA Agreement through conferences, publication, open access repositories, or free or open source software; or – the beneficiary commits to, on a timely basis, make available licences for research results of aided research and development projects, which are protected by intellectual property rights, at a market price and on non-exclusive and non-discriminatory basis for use by interested parties in the EEA.

7. The aid intensities for feasibility studies may be increased by 10 percentage points for medium-sized enterprises and by 20 percentage points for small enterprises.

Declaration form from an undertaking that is to receive support pursuant to Article 25 of the General Block Exemption Regulation for state aid

All undertakings that are to receive support to cover part of their R&D project costs from the Research Council must submit a declaration form. This applies to both companies serving as Project Owner and companies participating as partners in the project.

In the applicant declaration, you must state the size of the enterprise. You must confirm that you are not an undertaking in difficulty or have outstanding claims on you for repayment of state aid. More information and the background for this can be found in the applicant declaration form, which you can download on the right side of the page.

You are to submit one document for each undertaking that is recipient of state aid under the project. The Project Owner is responsible for ensuring that the declarations are submitted together, together with the revised grant application. Companies that are unable to submit such a declaration are not eligible to receive state aid from the Research Council.

With regard to the declaration that the undertaking is not an "undertaking in difficulty", the definition of the state aid rules is crucial. Please note that where the company in question is part of a group, you must make this assessment both at company level and at group level. This means that neither the company nor the group of which it is a part may be an undertaking in difficulty at the time of awarding aid, unless it is covered by an exemption.

Definition of “undertaking in difficulty”

An “undertaking in difficulty” means an undertaking in respect of which at least one of the following circumstances occurs:

a) In the case of a limited liability company (other than an SME that has been in existence for less than three years or, for the purposes of eligibility for risk finance aid, an SME within 7 years from its first commercial sale that qualifies for risk finance investments following due diligence by the selected financial intermediary), where more than half of its subscribed share capital has disappeared as a result of accumulated losses. This is the case when deduction of accumulated losses from reserves (and all other elements generally considered as part of the own funds of the company) leads to a negative cumulative amount that exceeds half of the subscribed share capital. For the purposes of this provision, ‘limited liability company’ refers in particular to the types of company mentioned in Annex I of Directive 2013/34/EU (1) and ‘share capital’ includes, where relevant, any share premium.

b) In the case of a company where at least some members have unlimited liability for the debt of the company (other than an SME that has been in existence for less than three years or, for the purposes of eligibility for risk finance aid, an SME within 7 years from its first commercial sale that qualifies for risk finance investments following due diligence by the selected financial intermediary), where more than half of its capital as shown in the company accounts has disappeared as a result of accumulated losses. For the purposes of this provision, “a company where at least some members have unlimited liability for the debt of the company” refers in particular to the types of company mentioned in Annex II of Directive 2013/34/EU.

c) Where the undertaking is subject to collective insolvency proceedings or fulfils the criteria under its domestic law for being placed in collective insolvency proceedings at the request of its creditors.

d) Where the undertaking has received rescue aid and has not yet reimbursed the loan or terminated the guarantee, or has received restructuring aid and is still subject to a restructuring plan.

e) In the case of an undertaking that is not an SME, where, for the past two years:

  1. the undertaking's book debt to equity ratio has been greater than 7.5 and
  2. the undertaking's EBITDA interest coverage ratio has been below 1.0.

Important definitions for Article 25

Fundamental research’ means experimental or theoretical work undertaken primarily to acquire new knowledge of the underlying foundations of phenomena and observable facts, without any direct commercial application or use in view.

Industrial research’ means the planned research or critical investigation aimed at the acquisition of new knowledge and skills for developing new products, processes or services or aimed at bringing about a significant improvement in existing products, processes or services, including digital products, processes or services, in any area, technology, industry or sector (including, but not limited to, digital industries and technologies, such as super-computing, quantum technologies, block chain technologies, artificial intelligence, cyber security, big data and cloud technologies). 

Industrial research comprises the creation of components parts of complex systems, and may include the construction of prototypes in a laboratory environment or in an environment with simulated interfaces to existing systems as well as of pilot lines, when necessary for the industrial research and notably for generic technology validation.

Experimental development’ means acquiring, combining, shaping and using existing scientific, technological, business and other relevant knowledge and skills with the aim of developing new or improved products, processes or services, including digital products, processes or services, in any area, technology, industry or sector (including, but not limited to, digital industries and technologies, such as for example super-computing, quantum technologies, block chain technologies, artificial intelligence, cyber security, big data and cloud or edge technologies). This may also encompass, for example, activities aiming at the conceptual definition, planning and documentation of new products, processes or services.

Experimental development may comprise prototyping, demonstrating, piloting, testing and validation of new or improved products, processes or services in environments representative of real life operating conditions where the primary objective is to make further technical improvements on products, processes or services that are not substantially set. This may include the development of a commercially usable prototype or pilot which is necessarily the final commercial product and which is too expensive to produce for it to be used only for demonstration and validation purposes.

Experimental development does not include routine or periodic changes made to existing products, production lines, manufacturing processes, services and other operations in progress, even if those changes may represent improvements.

Feasibility study’ means the evaluation and analysis of the potential of a project, which aims at supporting the process of decision-making by objectively and rationally uncovering its strengths and weaknesses, opportunities and threats, as well as identifying the resources required to carry it through and ultimately its prospects for success.

Effective collaboration’ means collaboration between at least two independent parties to exchange knowledge or technology, or to achieve a common objective based on the division of labour where the parties jointly define the scope of the collaborative project, contribute to its implementation and share its risks, as well as its results. One or several parties may bear the full costs of the project and thus relieve other parties of its financial risks. Contract research and provision of research services are not considered forms of collaboration.

Article 25 describes the types of activity eligible for support, the costs relating to these activities that may be covered in part or in full, and the maximum aid intensities for the various activities.

To be eligible, all project costs must be allocated to activity that falls within one of the four categories of research and development set out in Article 25(2). Support cannot be awarded for activities that do not fall within one of those categories and the costs for those activities must not be included in the part of the project funded by the Research Council.

If activities under the project extend across several of the categories, for instance both industrial research and experimental development, the Project Owner must maintain an overview to ensure that the costs for each activity are placed in their correct respective categories. This is necessary because the maximum aid intensity for a given activity will depend on the category it encompasses, and the Research Council will specify in the contract for R&D funding that the Project Owner is responsible for ensuring that the correct framework for support is adhered to.

See: Significance of the state aid rules for Innovation Projects for the Industrial Sector (pdf in Norwegian only).

Article 26 of the General Block Exemption Regulation

Article 26: Investment support for research infrastructures

1. Aid for the construction or upgrade of research infrastructures that perform economic activities shall be compatible with the internal market within the meaning of Article 107(3) of the Treaty and shall be exempted from the notification requirement of Article 108(3) of the Treaty, provided that the conditions laid down in this Article and in Chapter I are fulfilled.

2. Where a research infrastructure pursues both economic and non-economic activities, the financing, costs and revenues of each type of activity shall be accounted for separately on the basis of consistently applied and objectively justifiable cost accounting principles.

3. The price charged for the operation or use of the infrastructure shall correspond to a market price.

4. Access to the infrastructure shall be open to several users and be granted on a transparent and non-discriminatory basis. Undertakings which have financed at least 10 % of the investment costs of the infrastructure may be granted preferential access under more favourable conditions. In order to avoid overcompensation, such access shall be proportional to the undertaking’s contribution to the investment costs and these conditions shall be made publicly available.

5. The eligible costs shall be the investment costs in intangible and tangible assets.

6. The aid intensity shall not exceed 50 % of the eligible costs.

7. Where a research infrastructure receives public funding for both economic and non-economic activities, Member States shall put in place a monitoring and claw-back mechanism in order to ensure that the applicable aid intensity is not exceeded as a result of an increase in the share of economic activities compared to the situation envisaged at the time of awarding the aid.

Important definitions for Article 26

Research infrastructure’ means facilities, resources and related services that are used by the scientific community to conduct research in their respective fields and covers scientific equipment or sets of instruments, knowledge-based resources such as collections, archives or structured scientific information, enabling information and communication technology-based infrastructures such as grid, computing, software and communication, or any other entity of a unique nature essential to conduct research.

Such infrastructures may be ‘single-sited’ or ‘distributed’ (an organised network of resources) in accordance with Article 2(a) of Council Regulation (EC) No 723/2009 of 25 June 2009 on the Community legal framework for a European Research Infrastructure Consortium (ERIC) (1).

When the Research Council awards support for investment in research infrastructure via the application type “Research infrastructure”, it is important to note the following:

Support for investment in research infrastructure constitutes state aid when a research infrastructure is used to pursue economic activities. In the context of research infrastructure, economic activities include activities such as renting out of equipment and laboratories, supplying services to business undertakings and performing contract research.

Support for investment in research infrastructure that is used to pursue only non-economic activities does not constitute state aid. The primary activities of the research infrastructure are considered non-economic activities.

These include use of the research infrastructure for education, independent R&D, wide dissemination of research results and knowledge transfer activities, subject to the conditions set out in paragraph 19 of the EFTA Surveillance Authority’s guidelines on state aid for research and development and innovation.

When a research infrastructure is used to pursue both economic and non-economic activities, it is only the support for investment linked to the economic activities that constitutes state aid and must consequently be awarded in compliance with the state aid rules.

When the economic activities consume the same inputs (such as material, equipment, labour and fixed capital) as the non-economic activities and the capacity allocated each year to such economic activity does not exceed 20 % of the research infrastructure's overall annual capacity, the funding may fall outside the state aid rules in its entirety.

See paragraph 49 of the preamble to the General Block Exemption Regulation for further information.

The portion of the support for infrastructure awarded by the Research Council that constitutes state aid is granted under Article 26 of the General Block Exemption Regulation for state aid.

Article 22 of the General Block Exemption Regulation

Aid for Commercialisation Projects granted to undertakings will be granted in accordance with Article 22.

Only Article 22(3)(c) and Article 22(5) are currently applied by the Research Council.

Article 22: Aid for start-ups

1. Start-up aid schemes shall be compatible with the internal market within the meaning of Article 107(3) of the Treaty and shall be exempted from the notification requirement of Article 108(3) of the Treaty, provided the conditions laid down in this Article and in Chapter I are fulfilled.

2. Eligible undertakings shall be any unlisted small enterprise up to 5 years following its registration, that fulfils the following cumulative conditions:

(a) it has not taken over the activity of another undertaking, unless the turnover of the overtaken activity accounts for less than 10 % of the turnover of the eligible undertaking in the financial year preceding the take-over;

(b) it has not yet distributed profits;

(c) it has not acquired another undertaking or has not been formed through a merger, unless the turnover of the acquired undertaking accounts for less than 10 % of the turnover of the eligible undertaking in the financial year preceding the acquisition or the turnover of the undertaking formed through a merger is less than 10 % higher than the combined turnover that the merging undertakings had in the financial year preceding the merger.

For eligible undertakings that are not subject to registration, the 5 year eligibility period shall start from either the moment when the undertaking starts its economic activity or the moment it becomes liable to tax with regard to its economic activity, whichever is earlier.

By way of derogation from the first subparagraph, point (c), undertakings formed through a merger between undertakings eligible for aid under this Article shall also be considered eligible undertakings up to 5 years from the date of registration of the oldest of the merging undertakings.

3. Start-up aid shall take the form of:

(c) grants, including equity or quasi equity investment, interests rate and guarantee premium reductions up to EUR 0.5 million gross grant equivalent or EUR 0.75 million for undertakings established in assisted areas fulfilling the conditions of Article 107(3), point (c), of the Treaty, or EUR 1 million for undertakings established in assisted areas fulfilling the conditions of Article 107(3), point (a), of the Treaty;

(d) tax incentives to eligible undertakings up to EUR 0.5 million gross grant equivalent or EUR 0.75 million for undertakings established in assisted areas fulfilling the conditions of Article 107(3), point (c), of the Treaty, or EUR 1 million for undertakings established in assisted areas fulfilling the conditions of Article 107(3), point (a), of the Treaty.

5. For small and innovative enterprises, the maximum amounts set out in paragraph 3 may be doubled.

Important definitions for Article 22

‘innovative enterprise’ means an enterprise that meets one of the following conditions:

(a) it can demonstrate, by means of an evaluation carried out by an external expert, that it will in the foreseeable future develop products, services or processes which are new or substantially improved compared to the state of the art in its industry, and which carry a risk of technological or industrial failure; (a) that can demonstrate, by means of an evaluation carried out by an external expert that it will in the foreseeable future develop products, services or processes which are new or substantially improved compared to the state of the art in its industry, and which carry a risk of technological or industrial failure, or

(b) the research and development costs of which represent at least 10 % of its total operating costs in at least one of the three years preceding the granting of the aid or, in the case of a start-up enterprise without any financial history, in the audit of its current fiscal period, as certified by an external auditor;

(c) in the 3 years preceding the granting of the aid: (i) it has been awarded a Seal of Excellence quality label by the European Innovation Council in accordance with the Horizon 2020 work programme 2018-2020 adopted by Commission Implementing Decision C(2017)7124 (3) or with Article 2(23) and Article15(2) of Regulation (EU) 2021/695 of the European Parliament and of the Council (1); or (ii) it has received an investment by the European Innovation Council Fund, such as an investment in the context of the Accelerator Programme as referred to in Article 48(7) of Regulation (EU) 2021/695;

(d) in the 3 years preceding the granting of the aid: (i) it has participated in any action of the Commission’s space initiative ‘CASSINI’ (such as the Business Accelerator or the Matchmaking) (2); or (ii) it has received investment from the CASSINI Seed and Growth Funding Facility, or the InnovFin Space Equity Pilot; or (iii) it has been awarded a CASSINI Prize; or (iv) it has been granted funding in accordance with Regulation (EU) 2021/695 in the space research area resulting in the creation of a start-up; (v) or has been granted funding as a beneficiary of a research and development action under the European Defence Fund in accordance with Regulation (EU) 2021/697 of the European Parliament and of the Council (3); or (vi) has been granted funding under the European Defence Industrial Development Programme in accordance with Regulation (EU) 2018/1092 of the European Parliament and of the Council (4);

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