EIC Board welcomes Commission's FP10 proposal but flags key unresolved implementation questions
- ›The European Innovation Council Board supports the Commission proposal to expand the EIC as a standalone innovation pillar under FP10 and welcomes a reported budget increase of roughly 3.5 times.
- ›The Board praised retention of the Transition instrument, a strengthened Challenge model and provisions for an EIC Fund able to attract co investors and provide follow on financing.
- ›The Board asked for clarification on several operational and governance issues including the proposed ARPA like approach, the Transition instrument operation, synergies with the ERC and Pillar 2, the role in defence and dual use technologies, and the handling of exit proceeds.
- ›The Board said revenues from exits should reflow to the EIC Fund to finance follow on investments, and offered to provide more detailed advice during implementation.
EIC Board response to the Commission's FP10 proposal
The European Innovation Council Board has formally welcomed the European Commission proposal that expands the EIC into a standalone innovation pillar under the proposed 10th Framework Programme for Research and Innovation. The Board describes the proposal as broadly aligned with its earlier recommendations and highlights a substantial uplift in resources and autonomy intended to strengthen support for innovators across Europe.
What the Board welcomed
Key elements in the Commission proposal drew positive notice from the EIC Board. Most prominent is a reported increase in funding of about 3.5 times relative to the current envelope. The proposal also preserves the EIC as an integrated pathway to support projects from early stage research through to scaling and market entry. Other items highlighted by the Board include a more ambitious, demand driven Challenge model, an enhanced role for EIC Programme Managers, explicit recognition of the Transition scheme, provisions in the EIC Fund to enable follow on investment and the retention of an independent EIC work programme and Board.
Operational and implementation questions the Board wants clarified
While broadly supportive, the EIC Board identified several areas where the Commission's proposal requires further specification. The Board asked for clarity on how some of the new features would be implemented in practice. These areas will be important for legislators and for the design of the EIC's future governance and operations.
| Area | Board concern | Why it matters |
| ARPA like approach for EIC Challenges | Characteristics and governance of the proposed mission oriented, ARPA like model need specification | An ARPA like model implies faster, higher risk procurement and prototyping methods that differ from standard grant procedures and that require clear rules on flexibility and accountability |
| Role and operation of the Transition instrument | Clarify how Transition will act as an agile interface and whether fast tracking can happen outside formal calls | Transition is central to moving ideas from research to market readiness so procedures must balance speed, transparency and auditability |
| Synergies with European Research Council and Pillar 2 | Define boundaries and collaboration mechanisms with ERC and other Horizon pillars | Avoid duplication and ensure coherent support across fundamental research and competitiveness focused streams |
| Role in defence and dual use technologies | Operational and budgetary implications of supporting defence and dual use need full assessment | Defence related support raises legal, ethical and export control questions and requires alignment with the defence mini omnibus and national rules |
| Reflows from exits to the EIC Fund | Ensure revenues from exits can be reused by the Fund to provide follow on financing | Reflowing returns is important to sustain investment capacity but may face constraints from EU budgetary rules and accounting practices |
Explaining key concepts the statement references
Context for EIC reform and implications
The Commission's proposal comes at a moment when EU leaders are seeking to bolster strategic autonomy and industrial competitiveness. Expanding the EIC into a standalone innovation pillar responds to longstanding calls for more integrated support for deep tech and scaling. A roughly 3.5 fold budget uplift would materially increase the EIC's ability to back riskier deep tech projects and to provide follow on finance alongside the private sector. However, more money alone will not guarantee impact. The design of incentives, governance, cooperation with national and regional funds and legal frameworks for dual use and reflows will determine how effective the expanded EIC can be.
The Board also underlined the importance of preserving an independent EIC work programme and a Board composed of external experts. Those features are intended to keep the EIC responsive to innovators and to safeguard decisions from short term political step changes. At the same time, greater autonomy for programme managers and more mission oriented work will put a premium on robust oversight and transparency.
Risks and practical constraints to watch
Several practical constraints could limit the proposal's ambition. Allowing exit proceeds to be recycled inside an EU instrument encounters budgetary accounting rules that typically treat such returns as revenue to the EU budget rather than a revolving fund. State aid rules and financial regulation may require careful structuring of equity operations and co investment to avoid market distortion. Introducing defence and dual use activities raises legal, export control and ethical questions that need harmonised rules across Member States. Finally, scaling an ARPA like approach in the EU context will require changes to procurement and contracting that must pass legal scrutiny.
What happens next
The Commission proposal for FP10 must now be negotiated and agreed by the European Parliament and Member States. The EIC Board has said it will contribute more detailed advice as implementation questions are worked through in further Board meetings. Key actors in the coming months will include EISMEA that administers the EIC today, the EIC Fund and the European Investment Bank that already play roles in due diligence and investment advisory. Legislators will need to reconcile the operational needs flagged by the Board with EU budgetary, audit and legal frameworks.
Bottom line
The EIC Board welcomed the Commission's proposal to expand and resource the EIC as a standalone innovation pillar. The increase in budget and the focus on a stronger Challenge model and follow on finance are notable. At the same time the Board has sensibly pressed for practical clarifications on how an ARPA like approach, Transition operations, synergies with other research pillars, defence related support and the recycling of investment returns would work in practice. Those answers will determine whether the expanded EIC improves Europe’s ability to turn research into globally competitive companies or merely rebrands existing instruments.