Notice

Guidance: International Bilateral Fund (IBF)

Updated 19 May 2023

This notice was withdrawn on 13 June 2023

This call closed on 9 June 2023.

1. Introduction

This call will close on 9 June 2023 at noon BST. To apply, please complete the application form and submit to ibf@ukspaceagency.gov.uk.

The UK Space Agency (UKSA) invites proposals for the International Bilateral Fund (IBF) to help strengthen the UK space sector’s partnerships with strategic and emerging space nations.

The National Space Strategy has set a new vision to make the UK one of the world’s most innovative and attractive space economies. The UK Space Agency has an essential role in delivering this. We help the UK to harness the power of space to benefit our people, planet and shared prosperity, by:

1. Catalysing investment – supporting projects that multiply the value of non-government contracts and capital secured by the UK space sector.

2. Delivering missions and capabilities that meet public needs and advance our understanding of the universe.

3. Championing space – advocating for the sustainable use of space, encouraging other sectors to use space solutions, and inspiring people into Science, Technology, Engineering and Mathematics (STEM) education and careers.

To do this, we deliver an exciting portfolio of activities: from helping companies to build space infrastructure and bring new services to market, to co-funding cutting edge research and reaching out to schools.

2. International Bilateral Fund (IBF)

The UK Space Agency International Bilateral Fund will invest up to £20 million in projects. This will contribute to the development of UK capabilities and our research base by delivering on the commitments made in the National Space Strategy to “increase our bilateral and multilateral partnerships with other spacefaring nations, forging the best relationships to achieve our goals in space”.

The objectives of the IBF are to:  

1. Build stronger relationships with priority countries and become a trusted space partner of choice

2. Increase UK space sector inward investment and exports

3. Develop UK capabilities in collaboration with our international partners.

There are two phases to this funding opportunity. It is essential that all applicants submit a bid for funding in Phase 1 in order to progress to the Phase 2 competition. We will only invite applications to Phase 2 from projects that successfully received funding in Phase 1.

Phase 1: Concept Call (this competition): Invites proposals of up to £75,000 for up to 4 months in duration.

Phase 2: Implementation Call (by invitation only): if successful in Phase 1, you will be invited to submit a proposal in Phase 2 for up to £1.5 million for up to 12 months in duration. Projects in Phase 2 are expected to include an element of co-funding from international partners. Your proposal will be subject to an independent assessment.

2.1 International Bilateral Fund – Phase One: Concept Call

The UK Space Agency is seeking to award the first tranche of IBF funding for approximately 20 concept projects.

Awards of up to £75,000 are available for up to 4 months in duration to catalyse partnerships between UK entities and international partners. These projects will aim to:

 

• Build or enhance relationships between UK entities and international counterparts

• Stimulate knowledge exchange, engagement and collaboration between international partners
• Demonstrate or validate the feasibility of technologies or capabilities, as appropriate, to support full stage applications for phase 2 funding
• Support the development of detailed proposals for the second tranche of IBF funding
• Scope the viability of potential projects to be submitted to the IBF
• Produce a Final Report highlighting the outcomes and achievements of the projects, alongside a key deliverable of a full application for review ahead of Phase 2

 

We are particularly interested to receive bids involving the USA, Canada, Australia and Japan, but will consider opportunities from elsewhere in the world.

All eligible applications will be reviewed and assessed by an independent expert panel against the criteria outlined below. The panel will make recommendations to the International Bilateral Fund Project Review Panel, which will be Chaired by the UK Space Agency’s Director of International, Engagement and Inspiration. The final decision to proceed will be made by the Project Review Panel. To achieve the programme’s objectives, we will fund a balanced portfolio of high scoring projects across a variety of technologies, markets, industry and sectors. 

 

Project funding will be awarded to the lead UK entity, who will have flexibility to distribute this funding to international partners, as necessary, subject to due diligence checks. Checks will be completed by the UK Space Agency prior to the commencement of funded activities. Project consortia can include both international partners, who are expected to contribute towards the match funding element, and subcontractors, who can be paid from award funds and therefore included in overall project costs. No more than 80% of the overall funding should be distributed to project partners and no more than 50% of the overall funding should be distributed to subcontractors.

Awarded projects must start no later than 1 August 2023 and must have fully completed by 30 November 2023. Grant funding per project is expected to range between £50,000 and £75,000 per grant. We require the project consortium in receipt of funding to contribute the necessary match funding specified in the subsidy control section below. Match funding can be contributed by the lead partner or any organisation within the proposed project consortium.

In exceptional circumstances, the UK Space Agency reserves the right to adjust the value or duration of the grant funding available. No more than 50% of the total grant value can be spent on travel and subsistence. In the event of high demand for funding and a large number of applications, the UK Space Agency reserves the right to introduce demand management measures.

Following previous international funding opportunities offered by the UK Space Agency, feedback has indicated that participants would value more time to work up detailed proposals and build international relationships ahead of submitting bids for larger funding allocations. We are therefore opening this initial call for applications to give the best possible chance for interested parties to develop their relationships and scope proposals in more depth. Projects will be overseen by the UK Space Agency in collaboration with STFC.

The aim of this initial phase is therefore to allow time for teams to develop and progress prospective bids for funding from conception to implementation. Successful projects will then be entered into a competitive down-selection process in December 2023, where approximately six bids with the highest potential will be progressed to receive an award of up to £1.5 million from the second tranche of IBF funding. We anticipate projects successful in securing this funding will commence delivery of Phase two in March 2024 and conclude by 31 March 2025 at the latest.

3. Indicative Timetable

Please note this timetable is indicative and may be subject to change in the event of operational constraints.

17 April – 9 June 2023	Phase 1 Concept Call
June 2023	Review of Phase 1 Applications
By end of July 2023	Successful applicants notified
August 2023	Phase 1 delivery commences
November 2023	Phase 1 projects conclude
December 2023	Phase 2 competition project review and prioritisation
February 2024	Phase 2 successful applicants notified
March 2024	Phase 2 delivery commences
31 March 2025	Phase 2 projects conclude

4. Subsidy Control

This award is being offered under the Research, Development and Innovation Streamlined Subsidy Scheme in accordance with section 10(4) of the Subsidy Control Act 2022. Projects funded as part of the International Bilateral Fund qualify as “industrial research” or “experimental development”, where:

• “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 for bringing about a significant improvement in existing products, processes or services
• “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

Subsidies given under these categories are subject to maximum award amounts and subsidy ratios set out in the Research, Development and Innovation Streamlined Subsidy Scheme. These are as follows:

	Industrial Research	Experimental Development
Small Enterprises	70% of the eligible project costs	45% of the eligible project costs
Medium Enterprises	60% of the eligible project costs	35% of the eligible project costs
Large Enterprises	50% of the eligible project costs	25% of the eligible project costs

Enterprises may receive a 15% uplift to the subsidy ratios where the project involves collaboration between enterprises, where at least one of the enterprises is an SME, or between an enterprise and one or more research and knowledge dissemination organisation, which must have the right to publish its own research results.

For the purposes of subsidy control, the following definitions are applicable:

• A small enterprise has an annual turnover below £10.2 million, a balance sheet total below £5.1 million and the average number of employees must not be more than 50
• A medium enterprise has an annual turnover below £36 million, a balance sheet total below £18 million and the average number of employees must be no more than 250
• A large enterprise has an annual turnover above £36 million, a balance sheet total above £18 million and the average number of employees is above 250

To qualify, two of the three conditions in the above definition must be met.

Applicants should note that the maximum award amount for both industrial research and experimental development projects is £3,000,000 per enterprise per project.

5. Assessment

Phase 1 Concept Call proposals will be assessed by an external panel using the following criteria and weightings:

1. International Relationships: 40%	To what degree does the proposal establish or strengthen long-lasting international partnerships with key strategic countries. Proposals should demonstrate which international stakeholders are engaged and involved and to what extent. There should be evidenced benefits delivered to the international partner. Also considered is the value of the project in developing global influence, reputation and championing of the UK space sector.      Highest scoring proposals will demonstrate a significant advance in a strategic relationship through demonstrating a clear interest for the project from a key stakeholder (International Space Agency/Government body); demonstrating a high global interest and profile in the project; demonstrating high relevance to partner country’s strategic ambitions through direct reference to the relevant strategies or priorities of the applicable space agency in the proposed international partner country or through Letters of Support and/or co-investment; achieving improved technological enhancements and/or commercial opportunities for both UK and the International contributors.   Moderate scoring proposals will demonstrate a shift in advancing a strategic relationship through demonstrating a strong interest (co-funding) from an international stakeholder (industry/academia); demonstrating some global interest in the project; demonstrating relevance to partner country’s strategic ambitions; achieving improved technological enhancements and/or commercial opportunities for both UK and the International contributors.     Low scoring proposals will demonstrate a limited shift in advancing a strategic relationship, with little interest from international stakeholders and limited value to a partner country.
2. Benefit to the UK and catalysing investment: 30%	Considers why the project should be funded and what investment and/or contract/export revenue is expected to be injected into the UK space sector: potential applications and the benefits it offers over existing products or services; who will benefit from the project and how, and the timeliness and critical stages of the project that will unlock investment and secure contract revenue as a result of undertaking the activity. Proposals should demonstrate that the investment sought from the UK Government represents good value for money for the UK public, through measurable benefits.    Highest scoring proposals will provide excellent, detailed evidence of the benefits that the government funding would enable them to achieve and the impact on the UK economy, including UK-based employment and contract opportunities. It will include a coherent and coordinated strategy to catalyse investment through new investment or contract revenue and include a quantitative assessment as to the potential scale of additional revenue and investment unlocked as a result of further developing the project. The costs of any activities proposed for grant funding will be fully justified and clearly linked to the outcomes and benefits. Risk, maturity and uncertainty will be well developed and made clear through the application in regards to the projects benefits and investment realisation plan.      Moderate scoring proposals will provide some evidence of the benefits that the government funding would enable them to provide to the UK economy and some justifications for grant funding are adequately linked to outcomes and benefits. The proposal will include direction and aims to catalyse investment although without a robust strategy.     Low scoring proposals provide little, poor or no evidence of the benefits that the government funding would enable them to provide to the UK economy OR the costs of any activities proposed for grant funding are poorly justified and not linked to outcomes and benefits. There will be little to no evidence of a strategy to catalyse investment.
3. Relevance to UK strategy: 20%	Considers the strategic relevance of the proposal and the extent to which it meets UK strategic aims. The proposal should demonstrate it is developing UK capabilities/solutions in line with UK Space Agency priorities and ambitions of the National Space Strategy. The UK Space Agency has outlined eight priorities and a clear Value Proposition in its Corporate Plan and proposals should clearly demonstrate how they contribute to these priorities and the aims of the National Space Strategy.      Highest scoring proposals will clearly outline and evidence how they align with, and contribute to, the UK Space Agency priorities. Strong proposals will not only fit within the highlighted sector priorities (Launch/EO/LEO/Sustainability) but meet another priority drivers (Innovation/Discovery/Levelling-up/Inspiration). There will also be strong evidenced links to meeting strategic aims highlighted in the NSS.     Moderate scoring proposals will demonstrate some relevance to one of the UK Space Agency priorities and refer to specific aspects of the NSS.     Low scoring proposals will demonstrate little or no consideration of the potential relevance to UK strategy, and little reference to UK Space Agency priorities or NSS aims.
4. Management and planning / quality of proposal: 10%	Considers the strength of the proposal including background, experience and track record of the team, the credibility of the proposed project delivery plan, and the extent to which all project costs are fully justified and reasonable. All proposals will need to demonstrate that they have effective structure(s) in place for project management, risk management and grant administration, including outlining a suitable approach to achieve the project aims on time and within budget.       Highest scoring proposals will demonstrate an approach to risk and programme management that is aligned with industry best practice. A strong team will be identified and resourced to enable the grant funding to be administered correctly. The project will demonstrate a balanced and skilled team able to drive both the development of the project and route for exploitation to secure the benefits outlined in the proposal. Risks to the project management will be clearly identified with detailed mitigations, providing a clear picture of the practicality and viability of the proposal. Proposals will demonstrate that supply chain risk has been considered and mitigating actions have been evaluated to protect the ability to meet delivery milestones as planned. Value for money will be considered as well as good time management and clear and focused documentation of progress.      Moderate scoring proposals demonstrate an approach to risk and programme management that is partially aligned with industry best practice. Moderate evidence of risks will be provided, alongside general mitigations, with some evidence of an appropriately resourced delivery team. Proposals recognise supply chain risk and have some broad ideas on how to react and meet delivery milestones as planned. Proposals will consider value for money as well as project documentation but with limited thought as to how their time will be best focused.      Low scoring proposals provide poor evidence or fail to demonstrate consideration of suitable risks and mitigations. No or little consideration of value for money and poor explanation of time management.

Applicants should be aware that their application will be shared in confidence with partner space agencies to enable an effective assessment of applications. As outlined above, the final decision to proceed with funding will be made by the International Bilateral Fund Project Review Panel (PRP) to ensure the overall portfolio of funded projects is balanced across all strategic objectives.

6. Grant Call Guidance Minimum Requirements

1. Organisation Eligibility

There are a series of requirements for eligibility to receive grant funding:

• Grant Recipients must demonstrate the ability to effectively manage a project

• Grant Recipients must have a UK bank account and all grant payments will be made in UK sterling (as per grant funding agreement)
• All project members must have in place and provide evidence of appropriate anti-bribery and anti-corruption policies
• All project members must provide evidence of a process for declaring and managing conflicts of interest
• All project members must be able to provide evidence that they are GDPR compliant

• Projects cannot work in areas that are in active conflict and any travel to overseas must comply with FCDO recommendations

• Projects must pass due diligence checks on company viability (financial standing assessment, governance, conflicts of interest, technical expertise)
• Formal teaming, or equivalent agreements between project partners must be in place within 60 days of grant signature
• Projects must comply with the rules stated in this guidance document.

1. Guidelines for Projects

Cost Recovery

The funds from Grant funding are on a cost recovery basis only. Grants are solely intended to cover the cost of delivering the agreed activity or goal. Any surplus funds not spent will be lost to the project unless there are alternative arrangements agreed.

Grantees cannot receive any funding from other grants/contracts to undertake the same activities.

Grant funding cannot be rolled over between financial years without explicit consent from UK Space Agency.

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1. Finance Policy

All partners must use a separate, project-specific, bank account or project accounting code for project funds to enable a clear audit trail.

6.1 Invoices

The UK Space Agency will only pay on actuals therefore we expect invoices may differ from forecasts. Should actual costs incurred be greater than the value of the milestone value, these costs will be borne by the Grant Recipient, unless the additional expenditure has been agreed with the UK Space Agency ahead of the costs being incurred and a Grant Change Notice (GCN) executed.

6.2 Staff Costs

Staff costs must be calculated on a cost recovery basis only and broken down by pay costs and overheads separately.

6.3 Pay costs

Pay costs are calculated based on your PAYE records. They should include gross salary, employer National Insurance (NI) contributions and employer pension contributions. Pay costs must not include:

• Any profit margins
• Commercial charge-out rates
• Allowances for bonuses and benefits in kind
• Business development
• Travel and Subsistence

These pay rates will be subject to checks during the negotiation stage by internal or external teams to ensure that day rates reflect actual costs. High payroll costs will be challenged and evidence (such as pay slips, etc.) must be provided to justify that the rate is on a cost recovery basis only.

When making grant claims against labour costs, actual costs claimed must be supported with timesheets of those individuals who have worked on the project.

In the budget breakdown in annex 3, you are asked to provide a pay cost per day. Using actual gross monthly payroll costs, please assume 260 working days in the year, less annual leave and public holiday entitlements.

1. Overheads

We understand that organisations calculate overheads in different ways.

This section offers 3 options for overhead costs:

1. No overheads. You can select this option if you are not incurring or claiming grant for your overheads

2. The 20% of labour costs option allows you to claim 20% of your labour costs as overhead. This includes both direct and indirect overhead. Selecting this option allows us to review a successful grant application much faster as no further documentation is needed from you.

3. The calculate overheads option asks you to complete calculations for claiming direct and indirect overheads. Any value claimed under this method will need to be reviewed by our project finance team if your application is successful. This is so we can assess the appropriateness of the overhead value you are claiming.

Full overhead recovery or full absorption costing is not eligible.

Please note that once the overhead is calculated and approved it cannot be exceeded at any time throughout the project life.

For option 3 you must complete the overhead calculation spreadsheet in Annex 4 and return with your grant submission.

The spreadsheet has 2 sections to fill:

• Indirect (administration) overheads
• Direct overheads

Once each section is completed the ‘Total overheads’ will calculate your total amount, for review by the UK Space Agency.

6.4 Indirect (administration) overhead

Selecting the indirect (administration) overheads link will take you to a template you’ll need to complete to calculate these costs.

We class indirect overheads as those costs associated with back office functions (such as finance, HR, administration staff) whose primary function is to support the running of a business enterprise. Typically these costs are not directly related to a particular product or service production.

Indirect overhead costs are eligible for inclusion if they are incurred directly as a result of undertaking the project. They must be additional, which means over and above your business as usual costs. Requests for higher then 20% overheads that cannot clearly demonstrate the additional resource specifically due to the grant being undertaken will be rejected.

Where you have already identified specific ‘indirect’ individuals working directly on the project, these should have been captured in the labour costs (section) together with their attributable overhead.

We have provided cost categories in the template. The table below provides our definition for each category.

Cost category	Definition
Board and senior management	The proportion of salary costs (including employer’s NI) of the board and senior management of the company. This should be where they are engaged in strategic or administrative tasks. Do not include those working directly on the project or who are customer facing or operational.
Administrative staff	The salary costs (including employer’s NI) of main administrative staff, such as receptionists and central administration. Do not include administrative staff employed to support sales, marketing, account management and profit generating departments.
Human resources staff	The salary costs (including employer’s NI) of human resource staff.
Employed estates staff	The salary costs (including employer’s NI) of employed cleaning, maintenance, security and other estates staff.
Finance department staff	The salary costs (including employer’s NI) of main finance department staff, such as payroll, accounts payable and receivable. Do not include staff employed to support sales, marketing or account management activities.
Administrative support temporary/agency staff costs	This should include fees paid for the provision of temporary staff in administration or support services as listed above. Do not include any staff that are operational, such as marketing, sales, engineering, quality assurance, research and development and supply chain.
General office IT services	Include general IT services used across the whole organisation. Do not include IT costs where they relate purely to non-eligible staff or manufacturing, production or fee earning activities.
General postage	Include postage and courier expenses for general administration needs. Do not include product delivery or any postage costs incurred through promotion, sales, marketing customer relationship or accounts management.
Office supplies, printing and stationery costs	General office stationery and supplies such as paper, business cards, corporate stationery, office equipment for support/admin staff listed above. Do not include specific costs associated with sales, marketing, product delivery, product literature or reports.
Security and safety costs	Include costs associated with site and staff safety and security including signage and health and safety costs.
Building maintenance: administration office facilities only	Include general repair and maintenance costs of administration facilities. Do not include repair and maintenance of manufacturing/production facilities and exceptional items such as new works or extensions which are not eligible for inclusion in this section.
Building rental: administration office facilities only	Where office space is leased include the rental costs. Do not include rental costs relating to manufacturing/production facilities and the cost of any deposits or penalties.
Contracted site services: administration office facilities only	Costs of contracted services relating to administration facilities such as cleaning of offices. Do not include contracted service costs related to manufacturing/production facilities.
Site property taxes: administration offices facilities only	Property taxes and charges relating to office space. Do not include manufacturing/production facility property taxes and charges.
Utilities: administration office facilities only	Electricity, gas, water, waste disposal, telecoms costs relating to administration office facilities.

The following is a step by step guide to help you fill in the relevant details to make your costs claim for indirect overhead.

6.5 Column A

Starting with your latest set of audited accounts please input your details against the relevant cost category in column A. If you are a new company or this information is unavailable, please use internal management accounts or forecast data.

Note that for the administration support staff costs section, the costs included here must be based upon PAYE (gross salary, NI, company pension contribution, life insurance). They should exclude discretionary package costs such as bonuses, awards, PRP and dividends. In addition please exclude any members working directly on the project who are customer facing or those engaged in operational/production areas.

6.6 Column B

In this column you should detail the proportion of the costs outlined in column A that represent core administration activity. You should follow the definitions and eligibility criteria outlined in the cost categories table above. You can use a percentage.

6.7 Column C

In column C please state what percentage of these costs you would assess as being additional and directly attributable administration activity to the project you are undertaking. By additional we mean over and above business as usual and specific to the Grant.

6.8 Column D

Based upon the details you’ve given in the previous columns, column D will automatically calculate the costs you’ve stated as being attributable to this project.

6.9 Column E

In column E you will need to provide some description of the cost constituents.

Once you have filled in this data you will see a percentage calculation (column F). This calculates what you consider as being eligible indirect overhead costs for your project (D) as a proportion of the annual audited figures (A). To save you time we use this calculated percentage and apply it to the remainder cost categories you have completed.

Any administration costs that are ineligible in this section but which directly relate to the project (for example based on invoices), should be claimed as direct costs within other sections of the finance form.

Completion of the indirect overheads template will calculate an annual total which will be proportioned for the length of time you are working on the project. You will see a per annum, per month and a per project cost. The per project costs will form your total indirect overheads as a monetary value.

Once you have filled out your indirect overheads information choose the ‘return to the overheads section’ to take you back to the main overheads section. Here you will see a summary of your indirect overhead.

6.10 Direct overhead

Selecting the direct overheads link will take you to a template you’ll need to complete to calculate these costs.

We understand that in undertaking a project you may incur associated costs with those staff working directly on the project. We refer to these as direct overheads. Typical costs in this area could include direct staff provision of laptops (non-capital only), desks, office (such as occupancy, facilities and utilities) and IT infrastructure and systems. This section is provided in free format for you to list out such costs.

Direct overhead costs must be directly attributable to the project you are undertaking and should not represent a full recovery methodology inclusive of redundant, spare capacity time or cost.

You should detail the costs and include a description of each item together with the methodology or basis of apportionment used. This should include the calculations that support the claimable costs. This will help us to validate these costs if your project is successful. If your costs have been subject to an independent audit verification we may ask you to provide this report to support our financial eligibility reviews.

Please note that costs associated with laboratories or workshops should be included within the other costs section of the application form.

Once you have completed the direct overhead you should select ‘return to the overheads section’. You will return to the main overhead section where you will see a summary of your overhead claim for both direct and indirect overheads.

6.11 Low Value Grants

Grant funding is outside the scope of VAT so you cannot charge output VAT on top of your submitted costs. If you incur non-recoverable input VAT costs, you cannot pass this on to UK Space Agency.

1. VAT Rules

Grant funding is outside the scope of VAT so you cannot charge output VAT on top of your submitted costs. If you incur non-recoverable input VAT costs, you cannot pass this on to UK Space Agency.

1. Ineligible expenditure

The following costs are ineligible: 

• Payment that supports for lobbying or activity intended to influence or attempt to influence Parliament, Government or political parties, or attempting to influence the awarding or renewal of contracts and grants, or attempting to influence legislative or regulatory action; 
• Using grant funding to petition for additional funding; 
• Input VAT reclaimable by the Grant Recipient from HMRC; 
• Payments for activities of a political or exclusively religious nature; 

• Goods or services that the Grant Recipient has a statutory duty to provide; 

• Payments reimbursed or to be reimbursed by other public or private sector grants 
• Contributions in kind (i.e. a contribution in goods or services, as opposed to money); 
• Depreciation, amortisation or impairment of fixed assets owned by the Grant Recipient; 
• The acquisition or improvement of fixed assets by the Grant Recipient (unless the grant is explicitly for capital use – this will be stipulated in the Grant Offer Letter); 

• Interest payments (including service charge payments for finance leases); 

• Gifts to individuals; 
• Entertaining (entertaining for this purpose means anything that would be a taxable benefit to the person being entertained, according to current UK tax regulations); 
• Statutory fines, criminal fines or penalties; or liabilities incurred before the issue of this funding agreement unless agreed in writing by UK Space Agency;
• Employee paid benefits and bonuses;
• Alcohol.

1. Travel and Subsistence

The following outlines the guidelines for travel and subsistence costs. Value for money must always be considered. If for any reason the set limits cannot be adhered to (e.g. to accommodate a reasonable adjustment), you must seek prior written approval from UK Space Agency. As per guidance above, no more than 50% of the total grant funding can be spent on travel and subsistence. No claims for alcohol will be accepted.

UK Space Agency reserves the right to not settle claims which have breached these guidelines. All expenditure must be supported by actual, itemised receipts.

Limits:

• Accommodation: £155 per night

• Breakfast: £5

• Lunch: £5
• Dinner: £15

Travel:

• All travel claimed must be using Economy rates.
• Tolls, Ferry Costs, Parking and congestion charge: Receipted costs for ferries, and tolls bridges and roads unavoidably incurred during your business journey may be claimed. Reasonable parking charges may be claimed. Receipted congestion charges unavoidably incurred on your business journey may be claimed.

1. Grant Funding Agreement

The grant funding agreement template is included as a separate document. Applicants must sign up to the terms as set out in the grant funding agreement.

No material changes to the terms will be considered. Minor changes may be considered if an applicant can demonstrate that agreeing to the provision within the Grant Funding Agreement would result in the applicant breaching its statutory or regulatory obligations. Grant applicants wishing to propose changes should not make changes directly to templates, but engage with the call lead and advice will be provided.

1. Grant Recipient Code of Conduct

All organisations in receipt of grant funding must abide by the UK government Code of Conduct for Grant Recipients: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/754555/2018-11-06_Code_of_Conduct_for_Grant_Recipients.pdf

1. Due Diligence

The UK Space Agency will carry out due diligence on grant applications as required using internal and, where necessary, external subject matter experts. The scope and degree of due diligence will be determined by the value, nature and complexity of the grant scheme. All applications will be subject to basic checks such as credit reports and Companies House checks.

Additional pre-award due diligence may include, but is not limited to:

• Technical assessment of the proposed project: including technical viability and sustainability;
• Financial assessment: organisation financial standing/health, assessment of project costs, aid intensity values and match funding contributions;
• Economic impact / VFM assessment

• Commercial: viability and / or commercial sustainability of the proposed solution, market position, demand and / or interest in technology, terms of the grant funding agreement; and / or

• Programmatic: alignment to aims and objectives of the programme, programme plan which demonstrates the project can be delivered within the funding period and the critical path, risks and issues, details on project partners and / or subcontractors.

Post-award due diligence may include, but if not limited to:

• Technical assessment of milestone deliverables against acceptance criteria to allow milestone payments to be released;

• Financial: assessment of expenditure for each milestone payment and reporting on planned costs, follow up review of financial standing/health if it is a multi-year project
• Commercial: change management including any variations to time, cost, scope, or GFA terms; review of milestone deliverables as required;
• Programmatic: project progress and impacts of any delays, risk assessment and mitigation activity; and
• End of project review: Has the technical and economic value been realised? Lessons learned and continuous improvement.

Grant Applicants who opt to work with project partners, companies involved in delivery of the project under a flow down agreement rather than a subcontractor, will assume all responsibility for partner due diligence.

Applicants will need to demonstrate they have carried out a sufficient level of due diligence with regard to their proposed project partners and subcontractors. Applicants will need to demonstrate they have carried out minimum checks at proposal stage, which may require further scrutiny if the proposal is to be funded.

To meet this requirement, applicants can provide evidence of due diligence carried out supported by the resulting information or submit a partner reasonable assurance statement. The evidence should be consistent with the checks that we would conduct on our Grant Recipients, for examples, financial standing, technical ability and scrutiny of the breakdown of costs. Any costs associated with project partner due diligence is considered a bidding cost and is to be borne by the applicant.

Applicants must provide evidence that they, and project partners have in place of appropriate anti-bribery and anti-corruption internal policies, and a process for declaring and managing conflicts of interest. 

6.12 How will the data be collected?

When beginning the grant or contract recipients will be asked to provide name and contact details of the person in your organisation who will be responsible for providing this information.

The data is to be reported at regular grant or contract management meetings on no less than every 6 months from the start of the activity covered by this agreement.

At the end of the grant or contract period the grant manager will decide a reasonable date with the grant or contract recipient at which time further data collection will be reasonable. Data will be required for at least 5 years after the completion of the activity covered by this agreement.

Where the length of benefit realisation would be longer than 5 years, the UK Space Agency may require an extended reporting period. This is to ensure that we are capturing the full benefits of an activity that has a long time period before those benefits are realised. Where this is the case the UK Space Agency will agree with grant recipients beforehand at the time at which a further request for information is sensible.

6.13 How will data privacy be maintained?

The information provided will only be used by the UK Space Agency and not shared with any other parties. Aggregate information may be presented more widely but this will be fully anonymised and not be attributable to any individual organisation.

In addition, this information is being used to assess the Agency’s impact on the space sector and is not intended to be used as a way to evaluate how the grant is being managed.

6.14 Definitions of the data to be collected

The below table contains definitions for the data we are looking to collect. Information should be reported both on financial information from the grant or recipients own company but also, if know, other companies who may have benefited from the grant or contract for example spinout companies that have been able to take advantaged of a new technological development.

Direct benefits should always be reported. Follow-on or spillover benefits should also be reported where there is strong evidence that the spillover benefit would not have occurred in the absence of UK Space Agency funding and is attributable to the grant or contract.

Term	Definition
Private Investment	Money invested by companies, individuals, or financial organisations through the following vehicles: equity, grant, prize, debt or alternative finance sources – excluding funding provided by the UK Space Agency directly or via the European Space Agency. The source of the investment can be either foreign or domestic.
Internal Investment	Investment within a company, or from a parent company to its subsidiary, to cover R&D, capital expenditures and other non-capital expenditures such development of intellectual property.
Total Income	Additional Income generated from creation of goods and services, as a result of the specified grant or contract. In the longer term this may also include income generated from royalties and licenses.

6.15 Attribution to UK Space Agency support

Data should only be reported where it could be reasonably stated that the revenue and/or investment in question would not have occurred without the UK Space Agency’s funding. Where the revenue and/or investment may have only been partially realised in the absence of the UK Space Agency’s funding, best efforts should be made to estimate the proportion of contract revenue and/or investment which can have been said to have occurred as a result.

6.16 Examples of information that should be reported

Private Investment

• Equity investment from a venture capital fund which can be attributed to the development of a new technology funded by the grant or programme
• Awarding of a grant from non-government organisations to further develop an idea which was initially funded by the grant or contract
• Foreign direct investment that can be attributed to a company experiencing growth as a direct result of receiving the UK Space Agency grant or contract

Internal Investment

• A parent company diverting funds toward the company to aid in the delivery of the programme originated by the grant or contract

• The purchase of large capital equipment to further research initially aided by the grant or contract
• Investment of R&D funds within the company to exploit and idea initially proposed as part of the grant or contract programme

Total Income

• Direct sales of any good or services which have been developed by grant or contract funding

• Income of spinout companies which have been established using a technology developed by the grant or contract funding

• Total Income of sub-sectors of the space market which have been newly developed as a result of the grant or contract funding
• Partial attribution of the revenue received from a future government contract which would not have been won without the development of a technology developed as part of the grant or contract programme

Additional Impact on Investment that cannot be quantified

• A qualitive description of the investment benefit generated from grants which have a negligible direct impact on investment, but these grants are critical to compliment company technology strategies

• A description of how the human capital improvements brought about by the grant or contract would lead to a more highly skilled workforce attracting investment in the UK Space industry from foreign investors.

• An assessment of how a technology developed by the grant has led to wider developments in the technological ecosystem which have generated their own investments and revenue.

6.17 Examples of information that should not be reported

Private Investment

• Grant funding received from the UK Space Agency – The Agency does not measure it’s grants success by the awarding of further grant in the future
• Full attribution of equity investment that can only be partially attributed to the grant or contract – If a grant or contract contributed to but is not the direct cause of receiving the investment then best efforts should be made to state the exact contribution of the grant or contract.

Internal Investment

• Match funding invested as a requirement of the grant – This information should be reported but in the separate field provided
• Funds redirect to divisions within organisations which in truth would have gone ahead without the grant or contract funding – If the grant or contract is part of a wider programme or division which receives additional funding this should only be counted if there is strong evidence these funds would not have been reallocated without the grant or contract being received

Total Income

• Grant or prize funding received from government or non-government organisations – This is considered private investment

• The Value of the grant or contract itself – This should be reported in the separate field provided

Additional Impact on Investment that cannot be quantified

• Qualitive assessment of benefits that can reasonably be quantified – This field is a compliment to the other information provided and not a replacement

If you have any specific questions on this requirement, please contact the UK Space Agency programme manager or named UK Space Agency contact.

  

6.18 Subsidy Control Guidance for Grant Applicants

1. The UK Space Agency (UKSA) supports organisations to invest in research, development and innovation. The support we provide is consistent with the UK’s international obligations and commitments to Subsidy Control (see further information at Annex A).  

2. Before awarding subsidies, the UK Space Agency must ensure that the subsidy scheme meets the terms of the principles as determined in the Subsidy Control Act 2022: 

The principles are that: 

• subsidies should pursue a specific public policy objective to remedy an identified market failure or to address an equity rationale such as local or regional disadvantage, social difficulties, or distributional concerns (“the objective”) 
• subsidies should be proportionate to their specific policy objective and limited to what is necessary to achieve the objective 

• subsidies should be designed to bring about a change of economic behaviour of the beneficiary that is conducive to achieving the objective and that would not be achieved in the absence of subsidies being provided 

• subsidies should not normally compensate for the costs the beneficiary would have funded in the absence of any subsidy 
• subsidies should be an appropriate policy instrument to achieve a public policy objective and that objective cannot be achieved through other less distortive means 
• subsidies’ positive contributions to achieving the objective should outweigh any negative effects, in particular the negative effects on trade or investment between the Parties 
• Subsidies should be designed to achieve their specific policy objective while minimising any negative effects on competition or investment within the United Kingdom.

1. To ensure this competition provides funding in line with the UK’s obligations and commitments to Subsidy Control:  

The intervention rates detailed in Annex A shall apply unless: 

a) the bidder seeks to claim exemption from having to make a contribution under the Minimal Financial Assistance Allowance (previously known as de-minimis under State Aid & Small Amounts of Financial Assistance under Trade & Co-operation Agreement) rules. 

b) the bidder is a research or public sector organisation or charity:  

 

When referring to research organisations, the UK Space Agency uses the definition from the Framework for state aid for research and development and innovation which states:  

 

“‘research and knowledge dissemination organisation’ or ‘research organisation’ means an entity (such as universities or research institutes, technology transfer agencies, innovation intermediaries, research-oriented physical or virtual collaborative entities), irrespective of its legal status (organised under public or private law) or way of financing, whose primary goal is to independently conduct fundamental research, industrial research or experimental development or to widely disseminate the results of such activities by way of teaching, publication or knowledge transfer. Where such entity also pursues economic activities, the financing, the costs, and the revenues of those economic activities must be accounted for separately. Undertakings that can exert a decisive influence upon such an entity, for example in the quality of shareholders or members, may not enjoy a preferential access to the results generated by it.”  

 

Within the UK Space Agency, this means:  

• universities – higher education institutions  
• non-profit research and technology organisations (RTOs), including “catapults”.  
• public sector organisations (PSOs)  
• public sector research establishments (PSREs)  

• research council institutes  

• research organisations (ROs)  
• charities.  

This list is not comprehensive and is subject to change and exceptions.

 

Research organisations undertaking non-economic activity will be funded as follows:  

• universities: 80% of full economic costs  
• all other research organisations: 100% of eligible costs.  

 

Research organisations should be non-profit distributing to qualify. They should explain how they will disseminate the output of their project research as outlined in the application.  

Research organisations which are engaged in economic activity as part of the project will be treated as business enterprises for the purposes of funding 

 

6.19 Public sector organisation or charity  

Public sector organisations and charities can work with businesses to achieve innovation through knowledge, skills and resources. These organisations must not take part in any economic activity or gain economic benefit from a project. They can apply for 100% of funding for their eligible costs under the following conditions:  

• they are undertaking research (this may be experimental, theoretical or critical investigation work to gain knowledge, skills or understanding vital to the project)  

• they meet requirements for dissemination of their project results and they state in the application how they will do this  

• they include their eligible costs for research purposes in the total research organisation involvement  
• they make sure they are not applying for funding towards costs which are already being paid by the public purse such as labour and overheads.  

 

6.20 Third sector  

Third sector organisations are primarily voluntary and community, such as associations, self-help groups, mutuals and cooperatives. Third sector organisations can be non-funding partners in a project.  

Bidders must identify the work proposed, and this must be consistent with the work programme described in the technical case. Note that the company size defines the maximum ‘Intervention’ rate (and hence the minimum required PV level) that is permitted (see Annex A). Bidders will be expected to justify the category of work selected. 

1. Bidders must ensure that they supply the correct information that allows UK Space Agency to award grants within the scheme. It is the responsibility of the grant funder to ensure compliance with the relevant Subsidy Controls rules and the bidder to assist the funder in doing this by acting within the terms and conditions of the scheme. Further guidance about subsidy control is available on the gov.uk website: 

https://www.gov.uk/government/publications/complying-with-the-uks-international-obligations-on-subsidy-control-guidance-for-public-authorities 

 

7. Annex A – Subsidy Control  

7.1 Subsidy Control (and State aid where relevant) 

The UK Space Agency supports UK based businesses to invest in research, development, and innovation. The support we provide is consistent with the UK’s international obligations and commitments to Subsidy Control. These include: 

• WTO rules 

• the EU-UK Trade and Cooperation Agreement (TCA), (see EU-UK TCA summary and BEIS (Dept. for Business, Energy & Industrial Strategy) guidance) 
• in certain circumstances (e.g. under the Northern Ireland Protocol) EU State aid regulations may also be applied 
• other bilateral UK FTAs (Free Trade Agreements) where relevant 
• Subsidy Control Act 2022.

7.2 What is a subsidy? 

For the purposes of UK international commitments, a subsidy is a measure which: 

1. Is given by a public authority. This can be at any level; central, devolved, regional or local government or a public body. 

2. Makes a contribution (this could be a financial or an in-kind contribution) to an enterprise, conferring an economic advantage that is not available on market terms. Examples of a contribution are grants, loans at below market rate, or a loan guarantee at below market rate or allowing a company to use publicly owned office space rent free. An enterprise is anyone who puts goods or services on a market. An enterprise could be a government department or a charity if they are acting commercially. 

3. Affects international trade. This can be trade with any World Trade Organisation member or, more specifically, between the UK and a country with whom it has a Free Trade Agreement. For example, if the subsidy is going towards a good which is traded between the UK and the EU this could affect trade between the EU and the UK. It is not necessary to consider whether the subsidy could harm trade, just whether there could be some sort of effect. Subsidies to very local companies or a small tourist attraction are unlikely to be a problem as this is unlikely to affect international trade. 

The BEIS Subsidy Control regime (or where relevant EU State aid regulations) are designed to prevent unfair advantages and distortion of trade: Complying with the UK’s international obligations on subsidy control 

More information on the principles of awarding subsidies can be found in the BEIS guidance. 

7.3 Subsidy Control Categories and Intervention Thresholds  

 

This award is being offered under the Research, Development and Innovation Streamlined Subsidy Scheme in accordance with section 10(4) of the Subsidy Control Act 2022. Projects funded as part of the International Bilateral Fund qualify as “industrial research” or “experimental development”, where

• “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 for bringing about a significant improvement in existing products, processes or services
• “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

Subsidies given under these categories and subject to maximum award amounts and subsidy ratios set out in the Research, Development and Innovation Streamlined Subsidy Scheme. These are as follows:

	Industrial Research	Experimental Development
Small Enterprises	70% of the eligible project costs	45% of the eligible project costs
Medium Enterprises	60% of the eligible project costs	35% of the eligible project costs
Large Enterprises	50% of the eligible project costs	25% of the eligible project costs

Enterprises may receive a 15% uplift to the subsidy ratios where the project involves collaboration between enterprises, where as least one of the enterprises is an SME, or between an enterprise and one or more research and knowledge dissemination organisation, which must have the right to publish its own research results.

For the purposes of subsidy control, the following definitions are applicable:

Applicants should note that the maximum award amount for both industrial research and experimental development projects is £3,000,000 per enterprise per project.

7.4 Disclaimer 

This guidance is not a substitute for taking independent legal advice on your eligibility status, before applying for funding. Every applicant is responsible for securing their own independent legal advice to ensure they are lawfully eligible.  

Please note the UK Space Agency is unable to award organisations that are considered to be ailing and insolvent companies. We will conduct financial viability and eligibility tests to confirm this is not the case following the application stage. 

If you see an error in this guidance :

Email: <Commercial@ukspaceagency.gov.uk >