This Report presents the results of an Interim Evaluation in compliance with Article 13 of the Decision (862/2010/EU) of the European Parliament and Council concerning the participation of the Union in a Joint Baltic Sea Research and Development Programme (BONUS) undertaken by several Member States.

Purpose of the report : the Decision requires the Commission to undertake an Interim Evaluation of BONUS no later than 31 December 2014 to assess progress towards the objectives set out in the Decision, as well as proposing recommendations to further enhance integration, quality and efficiency of implementation (including scientific, management and financial integration). The Interim Evaluation also assesses to what extend the financial contributions from the Participating States are appropriate, given the demands of their national research communities.

An Independent Panel with five experts has undertaken the Interim Evaluation of BONUS and their findings are provided within a detailed Evaluation Report.

This Report summarises the main conclusions of the Interim Evaluation and includes the Commission's observations.

Baltic Sea ecosystem and the programme’s objectives : the Baltic Sea is unique: semi-land locked, one of the world’s largest brackish water bodies, partially covered by winter ice, surrounded by nine States, eight of whom are EU Members. The Baltic Sea environment has been seriously affected by many pressures; both natural and man-made. These include pollutants such as dumped chemical weapons and heavy metal compounds. Also high levels of nutrients are linked to oxygen depleted dead zones, algal blooms and impacts on the natural fauna and flora. The unique biodiversity of the Baltic Sea Region has been further affected by the introduction of non-endemic alien organisms, fishing, maritime traffic, offshore activities, changing weather patterns, growing economies with increasingly intense agricultural practices and expanding coastal populations.

These pressures have seriously reduced the capacity of the Baltic Sea to provide the sustainable goods and services upon which the region depends directly and in terms of social, cultural and economic benefits.

Against this background, it has been considered that s cience can address these challenges and provide solutions to the urgent environmental problems facing the Baltic Sea. As a consequence, BONUS was established following the Decision of the European Parliament and Council as a joint undertaking of Denmark, Germany, Estonia, Latvia, Lithuania, Poland, Finland and Sweden (“the Participating States”) with the participation of the EU.

The overall objective of BONUS is to enhance the Baltic Sea Region's research capacity so as to underpin the development and implementation of 'fit-for-purpose' regulations, policies and management practices, to respond effectively to the major environmental and key societal challenges the region faces now and will face in the coming years.

This interim evaluation report covers progress of BONUS towards achieving its objectives.

Main conclusions from the interim evaluation report : on the basis of the evaluation report carried out by experts, the Commission considers that BONUS is progressively achieving its objectives and has successfully established an integrated Research and Development Programme to tackle the challenges facing the Baltic Sea .

BONUS overcomes fragmentation of research programmes, brings together a variety of skills and focuses this effort on creating the essential knowledge and innovative solutions to overcome the Baltic Sea's environmental problems.

BONUS's macro-regional approach to the Baltic and its catchments has enabled stronger impact than a broader programme directed towards the EU as a whole could have achieved. The establishment of closer links between BONUS and the Baltic Sea Region Programme further enhances the impact and is in line with the objectives of Horizon 2020, which also seeks to further enhance synergies between research and European Structural and Investment Funds.

BONUS integrates research programming, supports establishment of a European Research Area and contributes to several key policies, notably:

the EU Strategy for the Baltic Sea Region, the EU Marine Strategy Framework Directive, the EU Common Fisheries Policy and the HELCOM Baltic Sea Action Plan.

Whilst a durable integration has been achieved with a particularly high level of scientific and managerial integration, there have been difficulties concerning financial integration .

Recommendations from the expert group : to strengthen the potential outcomes of BONUS, the Evaluation Report recommends to:

develop a synthesis of the research supported by BONUS since its start as an ERANET until its current status as an Article 185. This should highlight the achievements and impacts; move towards the pooling of national funds to reduce the number and complexity caused by different funding streams. This would ensure more efficient management, reduce time to grant and overcome difficulties associated with applying common funding rules within national administrations; take steps to increase the provision of in-kind infrastructure contributions to BONUS projects. For example, national administrations could provide incentives to partly subsidise the provision of infrastructure to BONUS. If the in-kind provision of infrastructure cannot be increased, further national cash contributions will be necessary to ensure that BONUS is fully implemented; take steps to ensure that BONUS projects build synergies and network with other projects and initiatives within the Baltic Sea Region; increase the interaction between the BONUS Advisory Board and the Steering Committee by, for example, virtual online meetings; focus communications which highlight the impacts arising from BONUS towards the needs of specific stakeholder groups: institutions, conventions, policies, Directorates-Generals of the Commission, ministries and regional authorities, including those responsible for regional development; the Participating States and the Commission should strengthen strategic communication on the potential of BONUS funded research results for policy to the different Directorates-Generals involved and within Horizon 2020; improve the monitoring of BONUS by more systematic acquisition and analysis of data on the outcomes and impacts arising from BONUS by for example ensuring the regular effective surveying of stakeholders’ opinions and by tracking the trends in the total amount and proportion of national funds channelled through BONUS; target the communication of calls for proposals towards SMEs and provide additional support towards applications by SMEs and facilitate their incorporation within developing project consortia.

Commission feedback : overall, the Commission accepts these recommendations. Their implementation will be followed up as part of the Commission's oversight of the BONUS programme.

Recommendations concerning the provision of national funds are considered particularly important. Separate administration of national funds for domestic beneficiaries has caused a less efficient structure . The lack of a 'real common pot' to pool national funds risks insufficient national funding being available to support successful beneficiaries from certain countries within later BONUS calls.

To avoid this, the Participating States must be able to ensure that sufficient national funding is available to support all beneficiaries within successful BONUS projects. Early indications also show a potential shortfall in the value of national in-kind infrastructure contributions provided. Any shortfall will need to be addressed by either providing more in-kind infrastructure for free use within BONUS projects or by increasing national cash contributions. Otherwise, a serious shortcoming will be that BONUS is not be implemented to the programmes expected full financial value of EUR 100 million.

Also, in line with these recommendations, the Commission will seek to more systematically acquire and analyse relevant data to improve monitoring of the impacts arising from the BONUS programme and will strengthen the communication of relevant outcomes towards relevant services within the Commission.

PURPOSE: to allow the Community’s participation in a Joint Baltic Sea Research and Development Programme (BONUS-169) undertaken by several Member States.

LEGISLATIVE ACT : Decision No 862/2010/EU of the European Parliament and of the Council on the participation of the Union in a Joint Baltic Sea Research and Development Programme (BONUS) undertaken by several Member States

CONTENT: following a first reading agreement with the European Parliament, the Council adopted this decision approving Community participation in a research project in the Baltic Sea ("BONUS-169 programme") undertaken by several EU countries. BONUS-169 is a joint research programme undertaken by eight EU Baltic Sea Member States (Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Poland and Sweden) in support of sustainable development of the Baltic Sea region.

Objectives of BONUS : BONUS shall enhance the Baltic Sea Region’s research capacity to underpin the development and implementation of ‘fit-for-purpose’ regulations, policies and management practices, to respond effectively to the major environmental and key societal challenges which the region faces and will face in the coming years and to improve the efficiency and effectiveness of the Baltic Sea Region’s fragmented environmental research programming and approach by integrating the research activities in the Baltic Sea System into a durable, cooperative, interdisciplinary well-integrated and focused multi-national programme.

BONUS shall also contribute to the establishment and structuring of the European Research Area in the Baltic Sea Region. It aims to support scientific development and innovation by providing the necessary legal and organisational framework for trans-national cooperation between the Baltic Sea States on environmental research in the Baltic Sea region.

Relevance for Union policies : while largely focused on environmental research, BONUS cuts across a number of related Union research programmes on a range of human activities having accumulated impacts on ecosystems such as fisheries, aquaculture, agriculture, infrastructure (including in the field of energy), transport, training and mobility of researchers as well as socioeconomic issues. BONUS is of considerable relevance to a number of Union policies and directives including the Union Strategy for the Baltic Sea Region; the Common Fisheries Policy; the Common Agricultural Policy, water policy, and marine environmental policy, as well as international commitments of the Union such as the HELCOM Baltic Sea Action Plan. As a result, many other areas of Union policy will benefit from BONUS.

Implementation of BONUS : BONUS will be implemented by the Baltic Organisations’ Network for Funding Science (BONUS EEIG) in two phases, namely, a strategic phase followed by an implementation phase in accordance with Annex I.

Strategic phase : the strategic phase of BONUS shall last up to 18 months. It shall prepare the implementation phase. During the strategic phase, BONUS EEIG shall deal with the strategic development of BONUS to ensure that an optimal integration of Baltic Sea System research can be achieved. It shall seek to strengthen the involvement of stakeholders and user groups to ensure that the research is relevant to policy and management, and that the prioritisation of research themes is driven by policy needs and the full involvement of scientists and their respective research institutions, as well as the broad stakeholder communities shall be actively sought. During the strategic phase of BONUS, the involvement of additional sector-oriented funding agencies should be sought to further enhance the integration of research addressing cross-sectoral end-user needs and to ensure the effective use and uptake of results for policy and resource management arrangements across a wide array of economic sectors. The Commission may, if appropriate, make recommendations for improving the Strategic Research Agenda. At the end of the strategic phase, the Commission will verify that the Strategic Research Agenda, Stakeholders Consultation Platforms and implementation modalities are in place for BONUS to enter the implementation phase. Implementation Phase : this shall last for a minimum period of 5 years. Provided that the specified conditions are in place and the ex-ante audit of BONUS EEIG is positive, the Commission and BONUS EEIG shall conclude the Implementation Agreement. During the implementation phase joint calls for proposals shall be published and carried out with a view to funding strategically targeted BONUS projects addressing the objectives of BONUS. The topics shall be taken from BONUS Strategic Research Agenda, respect as far as possible the established roadmap and cover research, technological development and training and/or dissemination activities.

Union financial contribution : the EU shall make a financial contribution not exceeding EUR 50 million for the entire duration of BONUS in accordance with Regulation (EC) No 1906/2006 during the strategic phase and in accordance with the Financial Regulation during the implementation phase. Within that ceiling, the Union financial contribution shall match the contribution of the Participating States.

The Union financial contribution for the strategic phase shall not exceed EUR 1.25 million and match, within that limit, the contribution of the Participating States. The commitment of the Union to contribute to the strategic phase shall be conditional upon an equivalent commitment from the Participating States.

The Union financial contribution for the implementation phase shall not exceed EUR 48.75 million and match, within that limit, the contribution of the Participating States. That ceiling may be increased by any amount remaining after the implementation of the strategic phase. During the implementation phase, up to 25 % of the contribution from the Participating States may consist in providing in-kind infrastructure contribution.

The Union financial contribution for the implementation phase shall be conditional upon (a) the establishment by the Participating States of the Strategic Research Agenda, Stakeholders Consultation Platforms and the implementation modalities referred to in the text and (b) demonstration by BONUS EEIG of its capacity to implement BONUS, including receiving, allocating and monitoring the Union financial contribution.

Annual reporting and evaluation : the Commission shall include a report of the activities of BONUS in the annual report on the Seventh Framework Programme. It will carry out an interim evaluation of BONUS no later than 31 December 2014, which will cover progress towards the objectives, as well as the recommendations of BONUS on the most appropriate ways to further enhance integration and the quality and efficiency of the implementation, including scientific, management and financial integration and whether the level of the financial contributions of the Participating States is appropriate, given the potential demand from their national research communities. The Commission shall communicate the conclusions of its interim evaluation, accompanied by its observations, to the European Parliament and the Council.

ENTRY INTO FORCE: 3 October 2010.

The European Parliament adopted by 630 votes to 14, with 6 abstentions, a legislative resolution on the proposal for a decision of the European Parliament and of the Council on participation by the Community in a Joint Baltic Sea Research and Development Programme (BONUS-169) undertaken by several Member States.

It adopted its position at first reading under the ordinary legislative procedure (formerly known as the codecision procedure). The amendments adopted in plenary are a result of a compromise reached between the European Parliament and the Council.

They amend the Commission proposal as follows:

Implementation of BONUS : according to the amended text, the strategic phase of the Programme shall last up to 18 months . Parliament stressed the need to encourage an adequate participation of SME. They also state that the grant and payment of financing to participants in BONUS shall comply with common rules in line with the Seventh Framework Programme . Projects shall be selected according to the principles of equal treatment, transparency, independent evaluation, co-financing, no-profit, financing not cumulated with other Union sources, as well as the principle of non-retroactivity.

Conditions for the Union contribution : Parliament added here that the Union financial contribution for the implementation phase shall be conditional upon, inter alia, the establishment by the participating Member States of the Strategic Research Agenda, Stakeholders Consultation Platforms and the implementation modalities referred to in the text as well as the progress made towards the achievement of objectives and deliverables set out in Annex I, section 2 (strategic Phase.) The Commission may, if appropriate, make recommendations for improving the Strategic Research Agenda.

Evaluation : in the light of an interim evaluation conducted by the Commission, assisted by independent experts with a good knowledge of the local conditions, the Commission should assess the quality and efficiency of the implementation of BONUS and progress towards the objectives set, as well as conduct a final evaluation.

Annexes : it is stipulated that the BONUS EEIG shall be the recipient and administrator of the Union contribution. A Participating State may decide to administer its own national funding and to devote its cash contribution exclusively to domestic research that is selected at central level or to have its cash contribution administered centrally by the BONUS EEIG.

The Council took note of a presidency progress report ( 9423/10 ) on a decision aimed at approving Community participation in a research project in the Baltic Sea ("BONUS-169 programme") undertaken by several EU countries.

BONUS-169 is a joint research programme undertaken by eight EU Baltic Sea Member States (Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Poland and Sweden) in support of sustainable development of the Baltic Sea region.

Its main objective is to provide an effective response to key challenges in the region in relation to environmental protection and sustainable development, tourism, aquaculture, food safety, maritime transport and socio-economic issues.

A first reading agreement with the European Parliament is expected to be confirmed after the vote at the EP plenary assembly in mid-June, thus allowing the EU to contribute up to EUR 50 million for the whole duration of the project.

BONUS-169, which is in line with the objectives of the European strategy for maritime research and the Union's strategy for the Baltic Sea region, is to be considered as a pilot case for other similar regional initiatives.

The Committee on Committee on Industry, Research and Energy adopted the report drawn up by Lena EK (ALDE, SE) on the proposal for a decision of the European Parliament and of the Council on participation by the Community in a Joint Baltic Sea Research and Development Programme (BONUS-169) undertaken by several Member States. It recommended that the European Parliament’s position at first reading under the ordinary legislative procedure (formerly known as the codecision procedure) should be to amend the Commission proposal as follows:

Name : the Joint Baltic Sea Research and Development programme is referred to as BONUS throughout the text.

Implementation of BONUS : the strategic phase of the Programme shall last up to 18 months . Members stressed the need to encourage an adequate participation of SME. They also state that the grant and payment of financing to participants in BONUS shall comply with common rules in line with the Seventh Framework Programme.

Conditions for the Union contribution : the committee added here that he Union financial contribution for the implementation phase shall be conditional upon, inter alia, the establishment by the participating Member States of the Strategic Research Agenda, Stakeholders Consultation Platforms and the implementation modalities referred to in the text as well as the progress made towards the achievement of objectives and deliverables set out in Annex I, section 2 (strategic Phase.) The Commission may, if appropriate, make recommendations for improving the Strategic Research Agenda. There must also be a commitment by each participating State to contribute its share of the financing to BONUS and the effective payment of their financial contribution, in particular the funding of participants in the BONUS projects selected following the calls for proposals.

Annexes : the committee made some amendments to the Annexes. It states that The BONUS EEIG shall be the recipient and administrator of the Union contribution. A Participating State may decide to administer its own national funding and to devote its cash contribution exclusively to domestic research that is selected at central level or to have its cash contribution administered centrally by the BONUS EEIG.

The Commission made a brief presentation on the proposal for combating the negative impact of pollution, climate change, acidification, overexploitation and biodiversity loss in the Baltic Sea by means of a joint research and development project (the "BONUS-169" programme) undertaken by EU Baltic Sea countries.

PURPOSE: to allow the Community’s participation in a Joint Baltic Sea Research and Development Programme (BONUS-169) undertaken by several Member States.

PROPOSED ACT: Decision of the European Parliament and of the Council.

BACKGROUND: the Baltic Sea ecosystem is seriously impacted by many natural and human-induced pressures. The sea and coasts are particularly affected by combined and increasing negative impacts from pollution, eutrophication, climate change, acidification, invasive alien species, overexploitation of living resources and loss of biodiversity.

Although many research activities are taking place in the Baltic Sea region, these efforts remain, to a large degree, uncoordinated and lack a jointly agreed regional action plan.

Given the limited research possibilities available at national, regional or local level to individually meet the complex environmental challenges of the Baltic Sea region as a whole, action at Community level in the Baltic Sea region is urgently called for.

To respond to this, the Commission is presenting this proposal on the participation of the Community in a joint research and development programme for the Baltic (BONUS-169) to be undertaken by several Member States. By bringing together all 8 EU Baltic Sea Member States, this initiative aims to achieve sustainable coordination and cooperation among their research policies and scientific communities in tackling common European challenges and thus to make a significant contribution to the structuring of the European Research Area (ERA) in the Baltic Sea Region by removing barriers between nationally funded research programmes.

IMPACT ASSESSMENT: three policy options have been considered for meeting the general and specific objectives of the initiative. These are:

Policy option 1: continuation of policies so far developed under FP 7 (“business as usual”);

Policy option 2: recourse to regionally-oriented trans-thematic call(s) under the Framework Programme;

Policy option 3: recourse to Article 169 with three alternative approaches (A, B and C) varying in the extent and depth of the strategic orientation and the stakeholder involvement in the streamlining and implementation of the calls for proposals

Policy option 3 through approach A – recourse to Article 169 with a focus limited to marine research and with the immediate launching of science-driven calls for proposals, Policy option 3 through approach B – recourse to Article 169 with a focus broadened to include the Baltic Sea drainage basin and with a strategic vision and roadmap to be developed prior to the start of the initiative and Commission proposal, Policy option 3 through approach C – recourse to Article 169 with a focus broadened to include the Baltic Sea drainage basin and with a strategic vision and roadmap developed during the first phase of the initiative.

Policy option 3 through approach C is the preferred option since it can effectively address the shortcomings identified above by achieving long-lasting and durable integration at Member State, institutional and research community level. The Community contribution would ensure that truly European interest would be reflected in the working programme of the initiative, building upon, but not being limited by, activities addressed at purely national level.

CONTENT: the purpose of this proposal is to establish the participation of the Community in a Joint Baltic Sea Research Programme (BONUS-169) undertaken by all eight EU Baltic Sea Member States (Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Poland, and Sweden) in support of the Baltic Sea region’s sustainable development. There will be scope for participation of the Russian Federation in the Joint Research Programme provided that the necessary legal requirements are met. BONUS-169 will provide scientific outputs to facilitate the implementation of ecosystem-based management in the Baltic Sea region and support the development and implementation of 'fit-for-purpose' ecosystem-based regulations, policies and management practices aimed at safeguarding the sustainable use of the ecosystem’s goods and services. BONUS-169 will integrate the national research programmes and activities of the 8 Baltic Sea States into a single joint research programme and support, in particular, the research and environmental objectives of the Baltic Sea Strategy (see COM(2009)0248 ), the Marine and Maritime Strategy and the Water Framework Directive .

In order to reach its objectives, BONUS-169 will be implemented in two distinct phases:

an initial strategic phase , lasting two years, during which appropriate consultation platforms for active stakeholder involvement will be set-up, a strategic research agenda prepared, and precise implementation modalities will be further broadened and developed; an implementation phase , of minimum 5 years, during which a minimum of three joint calls will be launched in view of funding strategically targeted BONUS-169 projects specifically addressing the objectives of the initiative.

Since the future success of BONUS-169 will depend to a large extent upon the achievement of the objectives set out for the strategic phase, the Commission will evaluate the maturity and readiness of the initiative and, provided that the results of the evaluation of are positive, the Commission and the BONUS EEIG shall conclude the implementation agreement. The participating states have agreed that the Baltic Organisations Network for Funding Science, BONUS EEIG, established in Helsinki, Finland, will be the dedicated BONUS-169 implementation structure.

BUDGETARY IMPLICATION: the budgetary implications of this horizontal proposal are already mentioned in the legal basis of FP7 as well as in the "Cooperation" Specific Programme of FP7. The agreement to be concluded between the Commission and the dedicated implementation structure shall ensure that the financial interests of the Community are protected. The Community shall make a financial contribution of up to EUR 50 million for all the duration of BONUS-169 shall match the contribution of the participating states, bringing the total expected budget for the initiative to EUR 100 million .

The strategic phase will be implemented by a grant according to the rules set out in this Decision and on Regulation (EC) no 1906/2006 of the European Parliament and of the Council laying down the rules for the participation of undertakings, research centres and universities in actions under the Seventh Framework Programme and for the dissemination of research results (2007-2013). For 2010 , the contribution from DG RTD for the strategic phase will amount to EUR 1.25 million (the participating states have to contribute an equivalent amount).

The implementation phase will be implemented by indirect centralised management, according to the provisions of Art. 54(2) (c) of the Financial Regulation. According to the Financial Regulation, the Commission will first obtain evidence of the existence and proper operation of, inter-alia , grant-award procedures, an internal control system, an adequate accounting system within the entity to which it entrusts implementation, and an independent external audit.