Explanatory Memorandum to COM(2023)113 - Conclusion of the Agreement with New Zealand on the participation of New Zealand in Union programmes

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dossier COM(2023)113 - Conclusion of the Agreement with New Zealand on the participation of New Zealand in Union programmes.
source COM(2023)113 EN
date 07-03-2023


1. CONTEXT OF THE PROPOSAL

On 6 December 2021, by a Letter of Intent, New Zealand expressed its formal interest to associate to Horizon Europe.

New Zealand and the European Union have a history of fruitful cooperation in research and innovation. A Scientific and Technological Cooperation Agreement has been in force between New Zealand and the EU since 2009 providing a general legal framework for strengthening the cooperation between both Parties in this field and the forum for regular discussions of their research priorities and areas of common interest.

New Zealand has had a strong record of participations in the previous two Framework Programmes for Research and Innovation- the FP7 and Horizon 2020. Dozens of researchers have come to Europe with Marie Skłodowska-Curie Actions (MSCA) funding and New Zealand shows excellent figures in terms of overall New Zealand participation under Horizon 2020, with 77 participations.

The exploratory phase has clarified New Zealand’s interest in associating to Horizon Europe’s Pillar II (‘Global Challenges and European Industrial Competitiveness’). This pillar is characterised by existing inter-linkages between its clusters, as well as by the multi- or interdisciplinary nature of many projects. Its collaborative research orientation, and the priorities outlined in its clusters are rich in potential synergies with the New Zealand R&I system, and corresponds to both Parties’ strong political will to address together global issues such as climate change, health, energy and mobility, food, bioeconomy and natural resources, environment.

Article 16(1), point (d) of the Horizon Europe Regulation concerning the association of third countries to the programme provides for the possibility of association of third countries and territories that jointly fulfil all of the criteria spelled out therein. Such third countries or territories are to participate in the Horizon Europe programme on the basis of an agreement covering the participation of the third country or territory to any Union programme.

New Zealand fulfils those cumulative criteria, notably, it has a good capacity in science, technology and innovation; it is committed to a rules-based open market economy, including fair and equitable dealing with intellectual property rights, respect of human rights, backed by democratic institutions; and it actively promote policies to improve the economic and social well-being of its citizens.

On 9 September 2022, the Council authorised the Commission to open negotiations, on behalf of the Union, with New Zealand on an Agreement between the European Union and New Zealand on the general principles for the participation of New Zealand in Union programmes and New Zealand’s association to Horizon Europe – the Framework Programme for Research and Innovation (2021-2027) 1 . The Research Working Party and the COASI Working Party were appointed by the Council to act in the capacity of the special committees to assist the Commission during negotiations.

Negotiations began on 28 October 2022 and concluded on 20 December 2022. The text of the draft Agreement was initialled by representatives from each of the future Parties on 22 December 2022. The Research Working Party and COASI Working Party were regularly consulted during negotiations and the European Parliament was kept regularly informed.

In line with the negotiating directives, which the Commission obtained from the Council, the Agreement annexed to this proposal is composed of two parts, notably the general principles for the participation of New Zealand in Union Programmes and the Protocol on the terms and conditions for the association of New Zealand to Horizon Europe – the Framework Programme for Research and Innovation (2021-2027). The latter part is embedded into the Protocol, forming an integral part of the Agreement.


The Agreement comprehensively regulates the conditions of association of New Zealand applicable across all Union programmes. It governs the terms and conditions for participation in EU programmes, modalities for establishing participation in (association to) any given Union programme and the involvement of New Zealand in the governance of the Union Programmes or activities (reflecting the principle of no decision making powers). It contains detailed rules for the establishment of the financial contribution of New Zealand to the Union Programmes, including, where applicable, an automatic correction mechanism. The Agreement contains comprehensive rules for the protection of EU financial interests across all EU programmes, including powers which the Commission, European Court of Auditors, OLAF and EPPO exercise to that end, as well as rules allowing for swift recovery of financial amounts due by New Zealand beneficiaries, pursuant to adoption of Commission decisions on recovery or judgments of the Court of Justice of the European Union addressed to New Zealand beneficiaries in any Union Programmes to which New Zealand may become associated. The Agreement also establishes institutional structures, i.e. a Joint Committee tasked with inter alia monitoring of the implementation of the Agreement and examining how to improve and develop the cooperation under the Agreement.

The Agreement is meant to create a lasting legal framework for cooperation between the Union and New Zealand in relation to Union programmes. It is expected to remain in force for several Multi-annual Financial Frameworks of the EU, similarly to the Agreement on the European Economic Area, the EU-UK Trade and Cooperation Agreement or the framework agreements with Enlargement and European Neighbourhood Partnership countries on the general principles for participation of these countries in EU programmes. Protocols on association of New Zealand to each specific Union programme could be added to this Agreement in the future, if such Programmes are open to New Zealand participation under EU basic acts establishing each relevant Programme, and if this is the political wish of both Parties, and following the completion of required internal procedures. The duration of the Protocols is expected to be limited in time to the implementation of any particular Union programme.

It is proposed that the Protocols will be adopted via consensual decisions of the Joint Committee, which this Agreement will establish.

All essential elements pertaining to cooperation between the EU and New Zealand in Union programmes are comprehensively regulated in the Agreement. Article 3(4) of the Agreement specifically pre-defines and restricts the content of the future Protocols to: identifying the relevant Programme, activity or part thereof; setting the duration of the association; regulating matters which are programme-specific and not otherwise regulated in the Agreement and – in specific cases where the Union programme is implemented through a financial instrument or a budgetary guarantee - laying down the amount of New Zealand’s contribution to such a Union programme.

The first such Protocol on Horizon Europe association was negotiated in parallel to the provisions of the Agreement on general principles of New Zealand’s participation in Union programmes and forms an integral part of the Agreement, which is now being proposed for conclusion by the EU. This way of proceeding was authorised by the Council in the negotiating directives of 9 September 2022. In order to be able to grant privileged access to the Calls of Horizon Europe Pillar II under the Work Programme 2023-24 the Agreement also provides for provisional application.

Regarding the programme-specific terms and conditions providing for the association of New Zealand to the Horizon Europe Framework Programme, they provide – in line with the recommendation of the Council – for association to the Pillar II of the Programme.

Following an internal analysis of the benefits for the Union, an assessment was made to limit the scope of the associations of Horizon Europe category (d) countries to Pillar II of Horizon Europe programme. Pillar I of the programme primarily aims to strengthen the EU’s own science and technology bases, build-up European research and innovation capabilities and attract knowledge and talents to Europe. Pillar III focuses on the competitiveness and the innovative capabilities of the EU. Thus Pillar II was considered the most appropriate for opening to association of highly-industrialised countries located not in the Union’s geographic vicinity (without prejudice to any decisions concerning a different scope of possible future association should it be regarded in EU interest).

The policies of the New Zealand government in areas such as climate change and carbon-neutrality point to the long-term potential for developing synergies in Pillar II between researchers from the Union and New Zealand, particularly given Horizon Europe’s key objective of tackling climate change.

An association of New Zealand to Pillar II is expected not only to strengthen an already strong cooperation in areas of mutual interest, but also to contribute to unlocking pre-identified potential for cooperation in other areas of significance, such as administrative big data and precision agriculture, sustainable energy, earthquake research or industrial innovation. The identified niches of excellence in the New Zealand research system include bioengineering in medicine, optimisation in industry and services, and Antarctic Research. In the Pacific region, the EU cooperates with New Zealand on a number of issues including climate change, regional integration, ocean governance, fisheries (including Illegal Unreported and Unregulated Fishing) and security (including maritime security). New Zealand is additionally leading in terms of inclusive research by encouraging the incorporation of indigenous knowledge (Mātauranga Māori) across all disciplines.

Cooperation through association between the EU and New Zealand would enhance the EU’s innovativeness and competitiveness. Given the high success rate and high quality of applications and proposals by entities from New Zealand, association would also contribute to improving the overall quality of projects funded under Horizon Europe, as well as help create synergies and competitive advantages at a global level. It is foreseen that association could lead to a significant increase in terms of cooperation as the EU is New Zealand’s most significant regional science and innovation partner, with more than half of New Zealand’s researchers regularly engaged in active collaborations with EU partners. Around 4,000 businesses in New Zealand report performing R&D, with many more engaging in innovation. New Zealand has 8 Universities, 7 Crown Research Institutes, and a number of independent research organisations dedicated to research activity. It is important to underline that New Zealand is de facto dependent on international research collaboration with other countries in order to conduct frontier research in a number of areas, which explains New Zealand’s high level of interest in cooperation with the EU and other major Science, Technology and Innovation players across the globe such as the USA, China, Japan or South Korea.

The already close cooperation between the Union and New Zealand research entities is expected to be further strengthened through the provisions of the Protocol requiring opening of programmes and activities equivalent to Pillar II of Horizon Europe to the participation of EU-based research entities (with an indicative list of relevant New Zealand programmes contained in the Annex to the Protocol).

The proposed new agreement sets out fair and balanced conditions concerning the financial contribution of New Zealand to the Horizon Europe Programme, particularly through the application of the automatic correction system, implementation details thereof being laid down in the Protocol.

The draft Agreement annexed to this proposal for a Council decision is in line with the negotiating directives issued by the Council.

2. LEGAL elements of the proposal

The proposal for a Council decision is based on Articles 186 and 212 in conjunction with Article 218(6), point (a) of the Treaty on the Functioning of the European Union.

The consent of the European Parliament will be required under Article 218(6), point (a) TFEU for the conclusion of the Agreement annexed to this proposal.

In the light of the above, the Commission proposes that the Council conclude the Agreement on behalf of the European Union.

3. BUDGETARY IMPLICATIONS

The Legislative Financial Statement presented with this Decision sets out the indicative budgetary implications.