Library FAQ
What is an 'Intermediary Vehicle'?
Intermediary Vehicle means any subsidiary or other company, entity or arrangement (such as a limited partnership, unit trust or trust) in which the Company, for the account of a Compartment, holds any direct or indirect interest for the purpose of structuring...
What is the 'Investment Committee'?
Investment Committee means the investment committee of the External AIFM at the level of the External AIFM in charge of making all investments and divestment decisions, composed exclusively of officers, directors, delegates, members, employees or agents of the...
What is 'TRL' as used in the guidelines?
TRL means technology readiness levels pursuant to the Horizon Europe Work Programme general annexes.
What must the EIC Fund Final Recipient confirm regarding the ethics self-assessment?
The EIC Fund Final Recipient must confirm in the EIC Fund Agreement that the information provided in compliance with the Checklist (Horizon Europe ethics self-assessment guidance) is still accurate or provide updated information.
Who are 'Qualified Investors' under these guidelines?
Qualified Investor means an investor deploying privately sourced funds in an EIC Fund Final Recipient with demonstrable know-how and experience in the relevant market, technology and jurisdiction, who adds to Company due diligence and provides crucial support...
Who are 'Sanctioned Persons'?
Sanctioned Persons means any individual or entity listed in or otherwise subject to one or more Sanctions.
Who associated with the EIC Fund Final Recipient must also not be in an exclusion situation?
Natural or legal persons who are members of the administrative, management or supervisory body of the participant, those with powers of representation, decision or control regarding the EIC Fund Final Recipient, and beneficial owners as defined in Article 3(6)...
Can the EIC Fund appoint board members or experts to investee companies?
Yes. Subject to Board policy, the External AIFM may ensure qualified representatives or independent experts are appointed as voting board members of Final Recipients; such appointments are considered case by case during due diligence and included in legal docu...
How are exit (divestment) decisions made?
Exit decisions are made by the External AIFM in full discretion, in accordance with regulatory requirements, market practice and the Compartment’s Investment Guidelines. The Compartment generally acts as a patient investor.
How does the Adviser exercise shareholder voting rights on behalf of the EIC Fund?
Investment officers of the Adviser may be appointed by the External AIFM as Appointed EFFR Shareholder Representatives to act as proxies and exercise voting rights strictly in accordance with prior written voting instructions recorded in a Proxy Appointment; t...
How is intellectual property (IP) managed for EIC Accelerator operations?
EIC Accelerator operations are exempt from Horizon Europe IP obligations except where no investment component is awarded, no investment agreement is concluded, or the operation is terminated early. Within applicable national law, investees and co-investors are...
How should the Compartment coordinate exits with co-investors?
Divestment should generally occur alongside the lead investor or one of the lead investors. The Compartment should seek to divest with co-investors unless there are justified reasons to extend participation (e.g., to obtain a blocking minority) and should pref...
Under what conditions can the Compartment make follow-on investments?
Follow-on investments are possible only subject to an ex ante amending award decision by the EU Commission and only in exceptional cases, notably where a follow-on is necessary to secure a blocking minority or majority to protect European interests as identifi...
What acknowledgment regarding publication of information must EIC Fund Final Recipients include in their EIC Fund Agreement?
Each EIC Fund Agreement must acknowledge that the EIC Fund and/or the Adviser may communicate information regarding the EIC Fund Final Recipient (irrespective of the amount of support), and that the EIC Fund may provide or publish information including, but no...
What activities are excluded from EIC Fund investments?
Excluded activities include: production or activities involving harmful or exploitative forced labour or harmful child labour; production or trade illegal under host country laws or international conventions; pornography or prostitution; production/trade in wi...
What additional requirements must follow-on investments satisfy?
Follow-on investments must not crowd out smaller investments and must fulfil Horizon Europe requirements for EIC blended finance support (i.e., beneficiaries are SMEs or, exceptionally, small mid-caps; continued EIC support is necessary; InvestEU support not y...
What exit routes does the Compartment consider?
Exit routes are set case by case in cooperation with co-investors and may include initial public offerings (IPOs), management buy-outs, secondary sales, or liquidations.
What happens to additional investments awarded to Horizon 2020 EIC Pilot operations?
Where the EU Commission awards an additional investment to a Horizon 2020 EIC Pilot operation following an EIC Call for proposals, that additional investment is transferred under the Compartment.
What is the required written acknowledgment text for EIC Fund Final Recipients?
“[EIC Fund Final Recipient] hereby acknowledges that [this] investment [is]/[has been] provided by the EIC Fund set up under the European Innovation Council. The purpose of the European Innovation Council is to identify, develop and deploy breakthrough technol...
What is the typical investment duration and perspective of the Compartment?
The Compartment invests patient capital with a long perspective on return—typically seven (7) to ten (10) years on average, with a maximum of fifteen (15) years in general. The main objective is impact investment while planning for a positive return.
What limitations arise from the equity and quasi-equity nature of the Compartment’s investments?
Because investments are equity or quasi-equity, the EIC Fund will typically have no or limited remedies or exit/repayment possibilities if a Final Recipient fails to meet eligibility/exclusion criteria or breaches terms of the EIC Fund Agreement.
What measures are used to align investor and management interests and prepare for exit?
Alignment and exit preparation include implementing incentive programs (e.g., employee stock ownership plans), defining sector-relevant key metrics and plans to optimize them for exit, and identifying and engaging a pool of potential acquirers leading up to an...
When should the Compartment consider divesting?
The Compartment should divest when companies can be financed from market sources including InvestEU because EIC support is no longer needed. Less favourable exit scenarios (including exiting below the initial investment) should be considered if customary strat...
Who composes the Advisory Committee and what is its role?
The Advisory Committee is created by the External AIFM and is composed of External AIFM staff, external experts, two EU Commission representatives as observers (to interpret the Investment Guidelines and provide policy steer especially on EU economic security)...