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29.11.2013 | KPMG Law Insights

European Union to invest around one trillion euros from 2014 to 2020

Dear Readers,

After many years of negotiations, the EU Parliament has approved the budget for the years 2014 to 2020. Considerable importance is attached to research and development: EU funding for research and business in the member states will be significantly increased and will also be made more accessible. You can find more information and background on this in our first article.

In this issue, we also report on the new ERASMUS+ program, which was also approved by the European Parliament.

That universities are entrepreneurial is nothing new. The fact that this is now also measurable online, however, is. Read our article on the EU project “HEInnovate”. In addition, we report on the guidelines recently drawn up by the German Rectors’ Conference on the franchising of degree programs and the EU Commission’s guidelines on the evaluation of funding measures.

For those interested in public procurement law: Starting next year, the threshold values will change. Finally, we do not want to deprive you of the decision recently issued by the Berlin Appellate Court in which the court qualifies entering into a bidding consortium as an agreement restricting competition.

We wish you a wonderful Advent season

Sincerely yours

Public Sector Team of KPMG Rechtsanwaltsgesellschaft mbH

Mathias Oberndörfer

Lawyer

Dr. Anke Empting

Attorney at Law

 

Financial injection for HORIZON 2020

After two and a half years of negotiations, on November 19, 2013, the European Parliament approved the EU’s financial framework for the period from 2014 to 2020, paving the way for adoption by the European Council, which is expected in December. The European Union plans to invest around one trillion euros from 2014 to 2020.

The research and innovation program Horizon 2020 is to be supported with almost 80 billion euros. This will increase funding by about 30 percent over the current budget.

In the opinion of the EU Commission, increased investment in research and development must be promoted throughout the EU in order to achieve the core goal of the Europe 2020 strategy of investing 3 percent of GDP in the research and development sector.

ERASMUS+ goes live

The EU program “Erasmus” for education and training will be called ERASMUS+ in the future and – according to the decision of the EU Parliament on November 19, 2013 – will combine all current EU programs for education, training, youth and sport. The program is scheduled to start on January 1, 2014.

ERASMUS+ is initially designed for seven years. A budget of 14.7 billion euros is available – around 40 percent more than for the previous individual programs. More than 4 million people are expected to receive subsidies during the grant period. New features include the ability for students to take advantage of a student loan guarantee instrument to complete a full master’s degree abroad.

 

 

State aid: Presentation of the Guide for the Evaluation of Subsidy Programs

As part of its extensive EU state aid law reform, the EU Commission plans to introduce a more systematic assessment of public spending. In particular, ERDF funds, cohesion funds and ESF funds in the 2014 – 2020 program period are under scrutiny.

Against this background, the EU Commission published draft methodological guidance on November 22, 2013, which is the subject of a public consultation process up to and including January 24, 2014.

The guide is intended to enable government agencies to comprehensively evaluate public support systems – for example, whether and how efficiently the respective goals have been achieved. To establish minimum standards for assessment modalities and techniques in order to promote a common approach across Member States, thereby ensuring higher quality assessments.

 

Measuring entrepreneurial dimensions of universities

On November 18, 2013, the EU Commission and the Organization for Economic Cooperation and Development (OECD) presented the “HEInnovate” project. On this website, universities can self-evaluate their performance in categories such as governance and teaching. The issue is also the extent to which they validate the acquisition of entrepreneurial skills and the extent to which they maintain close relationships with incubators and science parks.

The site produces an assessment report that identifies the strengths and weaknesses of the university. At the same time, links to examples of best practices are provided to help improve the university’s entrepreneurial performance.

The German Rectors’ Conference (HRK) adopted guidelines for the franchising of degree programs at its general meeting on November 19, 2013. The background: universities can have study programs carried out by a university or non-university partner, whereby the academic degree is still awarded by the university.

The HRK now recommends five main points to ensure quality assurance:

  1. Clarify whether the franchise degree program is consistent with the university’s profile;
  2. the educational objectives of the university and the franchisee coincide;
  3. the contractual design of the franchise model must ensure quality assurance in particular;
  4. Students should be comprehensively informed about the range of courses offered, degrees, and any tuition fees that may have to be paid;
  5. periodic audits of the franchisee facility’s quality assurance systems.

Bidding consortiums in the focus of the courts

In its decision of October 24, 2013 – Verg 11/13 – the Berlin Appellate Court (Kammergericht Berlin, KG) ruled that entering into a bidding consortium is in principle to be regarded as an agreement restricting competition.

In its reasoning, the court stated that the members of the bidding consortium did not, at least with regard to the tendered contract, behave in a fundamentally competitive manner among themselves. This was not compatible with the provisions of the Act against Restraints of Competition (GWB).

The EU Commission, Directorate General Internal Market and Services, has adopted a draft regulation amending the applicable thresholds of Directives 2004/17/EC, 2004/18/EC and 2009/18/EC.

As of January 1, 2014, the following new thresholds apply to Europe-wide procurement procedures:

  • Supply and service contracts of the highest or upper federal authorities and comparable federal institutions: 134,000 euros
  • Supply and service contracts awarded by sector contracting authorities: 414,000 euros
  • Supply and service contracts in the defense and security sector: 414,000 euros
  • Supply and service contracts awarded by other contracting authorities: 207,000 euros
  • Construction contracts: 5,186,000 euros

Due to the current weakness of the euro, the thresholds in this adjustment phase are somewhat higher than before.

 

 

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Mathias Oberndörfer

Geschäftsführer
Mitglied des Vorstands Service Tax - KPMG AG Wirt­schafts­prüfungs­gesell­schaft

Theodor-Heuss-Straße 5
70174 Stuttgart

tel: +49 711 781923410
moberndoerfer@kpmg-law.com

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