The landscape of EU funding

Deloitte’s Global Investment and Innovation Incentives (Gi3) team is specialised in grants, credits, and incentives for research and development (R&D) and sustainability. Using a uniquely coordinated international approach, Gi3 aims to create a significant impact on clients' bottom lines by helping them identify and secure appropriate funding opportunities.

Deloitte’s Gi3 team offers Chinese companies robust assistance in navigating the complex landscape of European grants and incentives. With a team of specialists, Deloitte provides comprehensive support throughout the entire process, from identifying funding opportunities to preparing applications and ensuring compliance with all regulatory requirements.

What are grants?

At the heart of these opportunities are grants—non-repayable funds provided by governments, organizations, or institutions to support specific projects and initiatives. These funds are typically directed toward fostering innovation, sustainability, and economic growth. For companies aiming to expand operations, invest in new technologies, or create innovative products and services, grants provide essential financial support. By securing these funds, businesses can ease financial constraints and expedite their growth and development.

For Chinese companies looking to enter the European market, EU funding provides numerous opportunities to reduce their cost and support their activities. Eligibility factors typically include project alignment with EU priorities, the project’s maturity, and its potential for economic and environmental impact, creating a pathway for Chinese companies to tap into European funding as they expand their presence. Chinese companies are qualified for funding if they establish a legal presence within an EU member state or associated country or form partnerships with EU-based entities. Additionally, sometimes they need to form consortia or partnerships with European entities, such as companies, research institutions, or universities, to strengthen their commitment to Europe. It’s also essential for the projects to align with the strategic priorities and objectives of the specific EU funding program, demonstrating the potential for significant economic, environmental, or social impact within the EU.

Some Chinese companies are already enjoying different types of EU grants.

EU funding: what is out there?

Here is a list of funding program within EU with which Gi3 has ample experience with different clients.

1. The Innovation Fund plays a vital role in supporting green technology by aiming to reduce greenhouse gas emissions through highly innovative technologies and large flagship projects. It offers up to 60% funding for both small-scale and large-scale projects, with a budget of EUR 10 billion over ten years. Annual calls are made for both small- and large-scale projects.
2. The H2 Bank supports the transition to renewable hydrogen production, focusing on green electricity and value chain development. The programme is structured around two main pillars: H2-Production and H2-Importation. In 2023, the pilot auction allocated €800 million at the EU level and €350 million for German projects, with a second auction anticipated soon.
3. For projects with a focus on environmental sustainability, the LIFE programme offers significant support, targeting projects in environmental protection, circular economy, climate action, and clean energy transition. It provides funding ranging from 60% to 95% for eligible projects, with a budget of EUR 5.4 billion over 2021-2027.
4. Horizon Europe is the EU's key funding programme for research and innovation, with a budget of EUR 95 billion over 2021-2027. It provides non-reimbursable cash grants for projects that align with the programme's themes, offering up to 100% funding for selected projects. Specific calls for proposals are updated annually, covering a wide range of research and innovation areas. For this program, consortia are usually required.
5. To stimulate growth, jobs, and competitiveness, the Connecting Europe Facility (CEF) promotes targeted infrastructure investments in energy, transport, and telecom sectors. It offers up to 75% funding, with a budget of EUR 33.71 billion for the period 2021-2027. Calls for proposals are updated annually, focusing on specific infrastructure needs across the EU.
6. For market-driven, transnational innovation, Eureka supports collaborative R&D projects with a bottom-up approach, encouraging a wide range of innovation areas. Projects typically range around EUR 1 to 2 million, requiring a consortium of at least two partners from two different Eureka countries. Ongoing initiatives ensure continuous support for diverse projects.
7. The European Structural and Investment Funds (ESIF) also contribute to the EU’s development goals by investing in job creation and promoting a sustainable and healthy economy and environment. More than 50% of EU funding is allocated to ESIF, which is jointly managed by the European Commission and EU countries to support regional development and cohesion.

Attractive grants in different EU member states to support energy transition

Different member states within the EU also award grants to potential Chinese companies active in these countries. For example, France, Italy, and Spain are actively participating in significant initiatives to support the development of battery technologies. France is part of the Important Projects of Common European Interest (IPCEI) on batteries, which aims to foster research and innovation across the battery value chain. This initiative allocates substantial funding to develop innovative and sustainable battery technologies. Similarly, Italy is also involved in the IPCEI on batteries, contributing to the advancement of battery technologies and supporting the entire value chain from raw materials to recycling. In Spain, the Strategic Project for Economic Recovery and Transformation (PERTE) for Electric and Connected Vehicles (VEC) includes significant investments in battery production and electric vehicle development. This initiative focuses on creating a competitive and sustainable battery ecosystem, positioning Spain as a key player in the battery industry. In terms of H2, France's national hydrogen plan, with a budget of €7 billion by 2030, aims to develop green hydrogen production, support industrial applications, and promote hydrogen mobility. Italy's National Hydrogen Strategy plans to invest €10 billion by 2030 to advance green hydrogen production, infrastructure, and applications across various sectors, including industry and transport. Similarly, Spain's Hydrogen Roadmap outlines a strategy to invest €8.9 billion by 2030 in green hydrogen production, infrastructure, and applications, positioning Spain as a leader in the hydrogen economy and driving the transition to a sustainable and low-carbon energy system.

Foreign Subsidies Regulation

Besides giving out grants, the EU is also taking a closer look at grants by other countries outside the EU. Thus, the Foreign Subsidies Regulation (FSR) addresses market distortions in the EU caused by subsidies from non-EU countries. It applies to all companies active in the EU, covering various financial supports like tax incentives, grants, and loans. Companies must notify the EU of mergers and acquisitions if their EU turnover exceeds €500 million and foreign contributions surpass €50 million over three years. Public procurement notifications are required for tenders over €250 million with foreign contributions exceeding €4 million in three years. The FSR aims to ensure fair competition by scrutinizing and mitigating the impact of foreign subsidies.

How can Deloitte help?

To maximize your chances of securing funding, Deloitte begins by identifying relevant grants and incentives that align with your specific projects and business goals. Next, their experts conduct an eligibility analysis to confirm your qualification for various funding programs, ensuring that your projects meet the necessary criteria. In the application preparation phase, Deloitte assists in crafting high-quality, compliant documentation that clearly communicates the value and impact of your projects, making it easier for decision-makers to assess and approve your applications. To further support your journey, Deloitte offers end-to-end project management, coordinating all aspects of the application process and ensuring the timely submission of required documents.

Compliance and reporting are key to maintaining eligibility, and Deloitte helps you navigate this regulatory environment, ensuring adherence to all reporting and audit requirements associated with the grants and incentives you receive. Additionally, Deloitte provides strategic advice on integrating grants and incentives into your broader business strategy, aligning them with your innovation and sustainability goals.

Securing government grants and incentives can significantly enhance your company’s ability to innovate, expand, and reach sustainability goals. With Deloitte’s expertise and support, Chinese companies can effectively access a wide range of funding opportunities in Europe, driving growth and development in new markets.

For more information on how Deloitte can help you to secure government grants and incentives for your projects in Europe, please contact xxxx. Deloitte’s specialists are ready to offer tailored support to guide you through the funding landscape and achieve your business objectives.