In Horizon 2020, the main rules applicable to the ownership of project results can be found in the model grant agreement. According to these rules, project results are owned by the beneficiary which generates them. Your organisation would therefore own the results which it has generated.
However, if two or more beneficiaries jointly generate results and it is not possible to establish the respective contribution of each beneficiary, or to separate the results for the purpose of applying for, obtaining or maintaining their protection, then the results will be held by these beneficiaries under a regime of joint ownership. In this case, the joint owners must agree in writing on the allocation and terms of exercise of their joint ownership, by way of a joint ownership agreement.
If joint owners have not yet concluded a joint ownership agreement, the default joint ownership regime set forth in the grant agreement will apply. According to this default regime, each joint owner may grant non-exclusive licences to third parties to exploit the jointly owned results, without any right to sub-license, as long as the joint owners are given at least 45 days advance notice and a fair and reasonable compensation.
Please note that joint ownership is not compulsory. Indeed, once joint results have been generated, the joint owners can agree in writing to apply another regime than joint ownership, such as for instance the transfer to a single owner and the grant of access rights (e.g. licences) to the others.
As a general rule under the Grant Agreement (Article 30.1 of the Model Grant Agreement), each beneficiary may transfer the ownership of its own results. When doing so, the transferor has in principle the obligation to give at least a 45-day prior notice to the other beneficiaries which still have, or may still request, access rights to these results. The advance notice must contain sufficient information in order for these beneficiaries to identify the transferee and assess whether their access rights might be affected by the transfer. Upon notification, any of these beneficiaries with access rights may object to the transfer, if it can show that its access rights would be adversely affected. In this case, no transfer may take place until the beneficiaries concerned reach an agreement.
This notification and objection procedure can however be overlooked in certain specific situations, amongst which:
- Mergers and acquisitions: if a transfer of ownership is not explicit but the result of a take-over or merger between two companies, confidentiality constraints under mergers and acquisitions rules will normally prevail. This means that the transfer will have to be kept confidential until the take-over or merger happens, and will be notified to the relevant beneficiaries only afterwards.
- Transfers to specifically identified third parties: by prior written agreement, the beneficiaries may waive their right to object to transfers of ownership to a specifically identified third party. In this case, there is no need to notify the other beneficiaries of the intended transfer, since they have already agreed not to object to it. This mechanism is very useful if one of the beneficiaries is part of a large group and already plans to transfer its results to its mother company or to one of its subsidiaries: it allows this beneficiary to do so without having to notify each transfer every time.
In Horizon 2020, the general principle is that each partner has the right to transfer its own project results to a third party, such as its mother company.
However, if the transferee is located in a third country, i.e. a non-EU country non-associated with Horizon 2020 (such as the US), transfers will be possible in theory, but may be made subject to certain conditions. This will depend on whether your own Grant Agreement contains an optional clause to this effect (article 30.3 of the Model Grant Agreement).
If this optional clause is included in your Grant Agreement, the transfer of project results to a third party located in the US – or in any other non-associated country – will be subject to a prior, formal notification to the European Commission. Following this notification, the Commission will have the right to object to the transfer, if it considers that it is not in line with EU competitiveness interests, not consistent with ethical principles, or not consistent with security considerations. If the Commission objects, no transfer can take place; if it allows the transfer provided that certain conditions are met, no transfer can take place until these conditions are fulfilled.
If the optional article 30.3 is not included in your GA, transfers to third parties will be allowed, regardless of their location.
In any case, if a transfer is possible or allowed, please note that the transferee (US company) will still have to comply with certain obligations, such as the obligations to exploit, disseminate, and grant access rights to the project results (please see article 30.1 of the Model Grant Agreement).
In Horizon 2020, third parties do not sign the grant agreement and consequently are not project beneficiaries – for this reason, they do not have any “automatic” rights to the results under the grant agreement, according to which results are owned by the beneficiary generating them.
Furthermore, when resorting to third parties to carry out tasks under the action, and in case these third parties are entitled to claim rights over the results, the beneficiary concerned should make sure that it complies with its own obligations under the grant agreement. This means getting all the necessary rights from these third parties beforehand. This can be done by way of a transfer (assignment agreement) from the subcontractor to the beneficiary. Alternatively, this can also be done by way of a licence granted to this beneficiary over the subcontracted work. A licence should, however, be broad enough to allow the beneficiary to grant access rights – this means that it should include a right to sublicense. Such arrangements (transfer or licence) have to be made upon the signature of the subcontracting agreement.
The grant agreement therefore allows some flexibility on this topic and the ownership of certain project results can be left to the subcontractor, as long as the beneficiary is granted all the rights necessary for the implementation of the project and the exploitation of the results, in line with the grant agreement.