By Julien Sudre, founder of Grant360, grant writer with more than a hundred applications written, and provider of Horizon Europe project management services. Updated 3 October 2026.
You can subcontract defined Horizon Europe project tasks when the outsourcing is justified, appropriately documented and consistent with your Grant Agreement. The practical priorities are to classify the work correctly, explain it in the project plan, demonstrate value for money, prevent conflicts of interest and retain responsibility for delivery.
This guide follows the subcontracting process for collaborative Horizon Europe projects. Its financial examples concern grants reimbursing actual costs. Always start with your signed agreement and call conditions: the European Research Executive Agency explains that the Grant Agreement defines the work you commit to carry out.
What counts as subcontracting in Horizon Europe?
Subcontracting means paying an external organisation to implement an action task assigned to your organisation. The subcontractor has a commercial relationship with you; you remain the beneficiary responsible for the work.
The useful question is: "Are we buying something that helps us perform our task, or paying someone else to perform the task?"
Consider a project developing a diagnostic device. Buying reagents helps the beneficiary perform laboratory work. Commissioning an external laboratory to perform a defined validation task is a different arrangement. The classification follows the work entrusted to the provider, rather than the provider's name or the wording of its invoice.
Before requesting quotations, write down the task reference, the expected output and what your team will still do. This short description gives the scientific lead, finance team and procurement team a shared basis for the decision.
How do you distinguish subcontracting from purchases and external personnel?
Classify external support by its function in the project and the working relationship involved. An invoice alone does not establish the correct budget category.
Use these examples as decision aids:
- Purchase of goods or services: venue hire and catering for a workshop run by the beneficiary. Examine whether the provider supplies supporting inputs.
- Subcontracting: an external organisation implements a defined stakeholder consultation task. Examine whether it takes responsibility for an action task.
- External personnel: an individual works within the beneficiary's team. Examine whether the contractual arrangement meets the applicable personnel-cost conditions.
- Affiliated entity: a legally linked organisation participates in the action. Examine whether its role is identified under the Grant Agreement.
For example, renting a survey platform and commissioning someone to design, conduct and analyse a project survey are different scopes. Likewise, a software licence and an outsourced software-development task require different assessments.
These examples are decision aids, not automatic classifications. Read the contract alongside the work plan before assigning the cost category.
Which project tasks can you subcontract?
Use subcontracting for a justified, bounded contribution while retaining the consortium's capacity to deliver the project. The Commission's application template for Research and Innovation Actions (RIAs) and Innovation Actions (IAs) asks applicants to justify subcontracted tasks and states that core tasks should not be subcontracted. See Part B, table 3.1g.
A specialised validation service can make sense when a beneficiary needs a facility or accreditation it does not possess. An independent assessment can also have a clear purpose when independence is important to the method.
However, "technical work" and "core work" are not interchangeable. Assess the proposed scope rather than treating every activity involving research, software or a prototype as automatically forbidden. A subcontract may generate results; plan the intellectual property (IP) arrangements accordingly.
A useful design test is to ask what remains of the beneficiary's contribution after outsourcing. If its role becomes little more than passing invoices through the project, reconsider the consortium structure.
Can the coordinator outsource project management?
The coordinator must retain its contractual coordination duties, even when it buys supporting services. Article 7 of the Commission's Model Grant Agreement restricts delegation and subcontracting of the coordinator's specified duties, subject to its stated exceptions.
Distinguish support from responsibility. A tool may help collect reporting inputs; a consultant may help organise information. Those arrangements do not transfer the coordinator's duty to check, submit and manage the required information and payments.
For example, a reporting dashboard can reveal a missing partner contribution. Someone within the consortium must still decide how to resolve the issue and ensure that the report is complete.
Define the service scope around the support actually needed. Avoid a vague contract promising to "take over coordination". For the wider role, read what a Horizon Europe coordinator does.
How should you explain subcontracting in the proposal?
Describe the task, justify the outsourcing and provide a credible cost estimate. The RIA/IA application template provides a dedicated subcontracting table for each participant.
A useful justification answers four questions: what will be delivered, why an external provider is needed, how the estimate was obtained and who will supervise acceptance.
For example, an illustrative proposal entry could read:
External laboratory validation of 120 samples under Task 4.3. The beneficiary will develop the protocol and interpret the findings; the laboratory will perform the accredited measurements. The estimated €24,000 budget is based on preliminary market quotations. The beneficiary's validation lead will check completeness and accept the dataset and test report.
This is an original drafting example, not Commission wording or a price benchmark. Its value is the connection between scope, cost and retained responsibility.
Before submission, reconcile the work-package description, subcontracting table and budget. An evaluator should be able to understand the arrangement without reconstructing it from scattered passages.
Do you always need a competitive tender?
Competitive selection is the recommended default, but grant eligibility does not invariably require a formal tender. You must demonstrate best value for money or, where appropriate, lowest price, and avoid conflicts of interest. Public contracting authorities must also follow applicable national procurement law.
The Annotated Grant Agreement (AGA), Article 6.2.B explains that other evidence can establish compliance. There is no universal "three quotations" rule for all beneficiaries.
For a specialist testing contract, compare providers against the same specification: method, accreditation, turnaround time, data format and price. A cheaper offer that cannot deliver the required test is not necessarily better value.
If you use one provider, record the market evidence and reasons for your choice before signing. Familiarity with a supplier is not, by itself, a convincing explanation of value for money.
Can you subcontract to a consortium partner or an affiliated company?
Do not use subcontracting to invoice work between beneficiaries in the same grant. Participating affiliated entities should likewise declare their own costs. The AGA describes exceptional possibilities for non-participating affiliates, subject to eligibility conditions.
If a consortium partner is better placed to perform a task, first examine a task and budget reallocation. For a related company, disclose the relationship and assess the appropriate participation route before ordering work.
For example, a beneficiary's sister company might have the required facility. That does not make the proposed contract automatically acceptable. Record the relationship, consider alternatives and seek guidance where eligibility is uncertain.
What if subcontracting becomes necessary after grant signature?
An amendment is one route; a simplified approval procedure may also be available. Under that procedure, new subcontracting is flagged in the periodic report. Approval is not guaranteed, and restrictions may apply under the call.
The AGA explains these routes in Article 9.3.
Suppose a planned testing facility becomes unavailable halfway through the project. Record the operational problem, the proposed replacement scope, its cost and its effect on delivery. Discuss the approval route with the coordinator and granting authority before committing expenditure where possible.
Maintain this record as the decision develops. A clear chronology is more useful than trying to reconstruct the justification at the reporting deadline. This is one reason to keep continuous reporting up to date.
How does subcontracting affect your project budget?
In actual-cost grants, eligible subcontracting is declared as a direct cost and excluded from the indirect-cost calculation. See Article 6.2.E of the AGA and the applicable financial provisions of your agreement.
Here is an original calculation illustrating the standard Horizon Europe 25% indirect-cost treatment:
- Eligible expenditure included in the 25% calculation base: a €40,000 direct cost generates €10,000 in indirect costs, for a combined amount of €50,000.
- Eligible subcontracting: a €40,000 direct cost generates €0 in indirect costs, for a combined amount of €40,000.
The €10,000 difference is a calculation, not a measure of profit or proof that internal delivery is preferable. Compare staff availability, quality, timing and the full cost of supervising external work. The grant's funding rate also affects the reimbursement.
This table is not a lump-sum payment calculation. For a lump-sum grant, use the applicable agreement and work-package completion rules rather than treating supplier invoices as individually reimbursed costs.
What should your subcontract and evidence file contain?
Build an evidence file that connects the project task to the selection decision, contracted output, accepted work and declared cost. An invoice should be the end of that chain, not its entire substance.
As a practical filing structure, keep:
- The scope, task reference, justification and approval record.
- Market evidence, offers, assessment and conflict-of-interest checks.
- The signed contract, timetable, acceptance criteria and payment terms.
- Outputs, review comments, acceptance records, invoices and accounting evidence.
The contract should address confidentiality, relevant ethics and security requirements, result ownership or access, and the required audit rights. Where personal data are processed, address the General Data Protection Regulation (GDPR) and the parties' respective responsibilities.
For a software task, specify access to source code, documentation, dependencies and maintenance arrangements. For laboratory work, specify the protocol, raw-data format and acceptance checks. These details make the output usable after the supplier has been paid.
For the broader preparation process, read how to prepare for Horizon Europe audits.
How can you use subcontracting effectively throughout the project?
Treat subcontracting as a delivery decision with a named owner, clear scope and traceable evidence. Define the need early, select the provider on defensible grounds and check the output against the contract before accepting it.
The strongest arrangements connect five elements: the project task, the reason for outsourcing, the selection decision, the accepted output and the budget treatment. Review that connection whenever the scope or provider changes.
Used this way, subcontracting gives the consortium access to specialist capacity while preserving accountability. Integrate it into your wider Horizon Europe project management process, from proposal preparation to final reporting.