CONSORTIUM AGREEMENT

I. Definition

A group of separate natural or legal persons who come together to undertake an enterprise, a transaction, or a joint activity.

Within the field of EU-supported Research and Technological Development (RTD) projects, the partners will normally sign a consortium agreement.

II. General approach

·        The Partners of a Consortium MAY conclude a Consortium Agreement to organise the work and to specify certain rights and obligations to carry out the Project

·        The conclusion of the Consortium Agreement is not a MANDATORY condition under the EC Contract but the Commission recommends it.

·        The Consortium Agreement can SUPPLEMENT the EC Contract but not be in CONFLICT WITH the provisions of such Contract. In case of conflict the EC Contract shall prevail.

·        The Commission IS NOT A PARTY to this Agreement and consequently does not participate in it at any level.

·        The Consortium Agreement can be concluded at any moment but as a private document it should carefully NEGOTIATED among all the Parties.

·        The Consortium Agreement can be particularly useful when Parties need to agree on certain issues NOT  REGULATED by EC Legislation.

E.g.: the way of exercising ownership in case of joint inventions (joint ownership).

·        The terms of the Consortium Agreement shall comply with the EC competition rules set out in the EC Treaty and in the secondary legislation.

III.            Matters that CAN  be included in a Consortium Agreement.

·        Purpose: The Parties intend to co- operate in order to carry out the Project and to perform the tasks designated in the Work Plan.

·        Duration. The Consortium Agreement will come into force upon the signature of all the Parties but normally will have retroactive effects from the date of signing the EC Contract.

·     Internal organisation

·       Tasks of the Co-ordinator

E.g. the Consortium Agreement may set out a deadline within the payments shall be made to the Parties.

·        The Project Steering Committee

- Composition : Chairman and number of representatives

- Tasks          

-   Decision- making

-   Supervision of the strategy of the Project

-   Review of Work Plan if there is a need to request the Commission to amend it.

-       proposals to the Parties to deal with issues related to a Defaulting Party.

·        Responsibilities of the Parties

-   Towards the Co-ordinator and the Steering Committee

-       Towards each other

·        Liabilities of the Parties

-    Towards each other

      -    Towards the Commission

-    Towards third parties

·        Defaults and Remedies

In the event of a substantial breach of its obligations by a Party under this Agreement and/or under the EC Contract, the other Parties may decide jointly to terminate this Agreement. A request will be made to the Commission for the termination of the EC Contract with regard to the Defaulting Party.

·        Ownership:

The owner of “Knowledge” has the right to apply for the patent

The owner of the right has the possibility of transferring totally or partially such right to other Parties to the Consortium Agreement

Other additional rules to exercise ownership may be set out.

(e.g.: in the event of joint inventions; the Parties concerned may jointly apply for a patent)

·        “Pre-existing know – how”

The Parties may decide to list their pre-existing know how, which is “necessary” to carry out the Project, in an Annex to the Consortium Agreement.

·        Exploitation

The research Parties may grant Access rights (licenses) to the Industrial Parties to exploit the Knowledge they have generated in the Project on financial conditions (royalties or remuneration) to be agreed between the Parties concerned.

·        Publications

The Consortium Agreement will include the rules to allow publications or data concerning Knowledge resulting from the Project  (the text is normally circulated amongst all the Parties by the Co-ordinator).

Publications may be delayed if protection by patent is envisaged.

But the publications shall not be unreasonably delayed. A maximum deadline should be stated for filing a patent application

·        Confidentiality

Conditions need to be laid down for disclosing “Knowledge” and “Pre-existing know-how” connected with the Project or related to the business or affairs of another Party, among the Parties themselves or to a third party.

Said information shall not be used for any purpose other than the fulfilment of the terms of the EC Contract or the Consortium Agreement.

The period of time in which secrecy has to be respected shall be stipulated.

·        Procedures to follow in case a Party withdraws from the Project or its participation is terminated.

As a rule, the prior consent of the other Parties and a request to the Commission are needed in accordance with the terms of the EC Contract.

The Commission may terminate the participation of a Contractor on the basis of the provisions of Article 7 of the EC Contract.

·        Law governing the Consortium Agreement

The Parties may choose a national Law provided that such Law is connected with the Project.

e.g. Law of the Co-ordinator´s country