Notice

Guidance for applicants

Updated 19 April 2024

1. The C-LEO programme 

This call is now open and the online expression of interest (EoI) form should be completed by midday BST on Wednesday 8 May 2024.

The UK Space Agency Connectivity in Low Earth Orbit (C-LEO) programme will provide up to £160 million of grant funding and contract awards over the next 4 years to UK companies and researchers to develop innovative satellite communications technology.  

This first C-LEO call will provide up to £60 million in funding support over the next 4 years. 

The objective of the C-LEO programme is to future-proof the UK’s competitive edge in the high-value satellite communication sector by enabling its diversification into the high-growth and strategically important high-volume constellation market, including:    

• to accelerate the commercialisation and rapid industrialisation of key technologies and industry capabilities necessary for UK firms to meet demand for high-volume constellation production
• to enable UK firms to secure a significant and sustained share of the high-value contracts due in the next 4 to 5 years that will drive the future sector supply chain
• to develop the UK’s on-shore industrial capabilities in R&D-intensive activities of the constellation value chain
• to catalyse private sector investment in UK high-volume constellation sector by signalling the UK’s commitment to the long-term growth of the satellite communication sector

1.1. Strategic context 

The National Space Strategy has set a vision to make the UK one of the world’s most innovative and attractive space economies. The UK Space Agency has an essential role in delivering this. We help the UK to harness the power of space to benefit our people, planet and shared prosperity, by: 

• catalysing investment – supporting projects that multiply the value of non-government contracts and capital secured by the UK space sector
• delivering missions and capabilities that meet public needs and advance our understanding of the universe
• championing space – advocating for the sustainable use of space, encouraging other sectors to use space solutions, and inspiring people into science, technology, engineering and mathematics (STEM) education and careers

To do this, we deliver an exciting portfolio of activities from helping companies to build space infrastructure and bring new services to market, to co-funding cutting edge research and reaching out to schools.  

The C-LEO programme is strongly aligned with 3 of the 4 core pillars of the Strategy: unlocking growth in the UK space sector; growing the UK as a science and technology superpower; and developing resilient space capabilities and services. 

1.2. Outline of the process

The C-LEO programme will provide up to £160 million over the next 4 years to UK entities through a series of annual calls. The programme will provide funding through 2 different routes:

• in the form of grants awarded directly by UK Space Agency (‘the national grant route’)
• in the form of contracts awarded by the European Space Agency (ESA), as part of the wider Advanced Research in Telecommunications Systems (ARTES) programme (‘the ARTES contract route’)

For both routes, successful applicants will need to contribute match funding at the appropriate level based on the size of the applicant organisation. See further details below.

The UK Space Agency is seeking to award funding of around £5 million to £20 million per project to a handful of projects through this first call. These sums would need to be match funded by the applicant organisation. For example, an applicant organisation that is eligible for a 40% match funding rate that was seeking C-LEO funding support of £800,000 for a proposal would need to contribute £1.2 million in match funding (equating to a total project cost of £2 million).

1.3. Scope

This funding will be targeted towards proposals for innovative satellite communication technology in the following five technology areas:

• on-board (regenerative) processing (OBP)
• active antennas
• optical inter-satellite links (OISL)
• networking and routing
• user terminals (UT)

This funding will be targeted towards proposals with technology readiness levels (TRL) of between 4 and 6, with the aim being to raise the proposal to TRL 7 and above. The funding of higher TRL proposals will be considered.

By the end of the funded project, there must be a tangible improvement in the TRL of the technology or a demonstration of advancement in approach (engineering method, technical competence etc).

1.4. Eligibility

Eligibility requirements to receive C-LEO funding are:

• organisations must be UK-based
• commercial companies must have a UK registration at Companies House
• Successful applicants must have a UK bank account and all grant payments will be made in UK Sterling (as per the grant funding agreement). All ESA ARTES contract awards will be paid in Euros. Further details on ESA exchange rates can be found in Section 5.1 below.

If you are considering moving to the UK, or you do not have a UK registration, you can seek further guidance from the team by emailing C-LEO@ukspaceagency.gov.uk.

You may partner with non-UK companies, but these must either be self-funded or be funded by other ESA delegates. This requirement refers to project participants and does not represent a domestic input requirement for goods and services purchased to deliver your project.

1.5. Differences in match funding rates

This programme will provide funding through 2 different routes: a national grant route and an ARTES contract route. The match funding rates for those 2 routes are different, as set out in the table below:

	National rate	National rate with collaboration uplift	ARTES (up to these values)
Small enterprises	45%	60%	75%
Medium enterprises	35%	50%	75%
Large enterprises	25%	40%	50%

Percentage (%) is the proportion of eligible project costs.

Match-funding rates are calculated based on the size and nature of the applicant organisation. Further information on match funding rates is available in sections 4.2 and 5.1 below.

Applicants are given the choice at the expression of interest (EoI) stage to indicate whether they would like to be considered for the national grant route or the ARTES contract route or both. 

For applicants that are successful at the application stage and would like to be considered for both routes, the UK Space Agency will decide which funding route their proposal will be funded from. The UK Space Agency will consider the following when taking this decision:

• preference of the applicant, as stated in the EoI or application form
• availability of funds
• technology area and corresponding technical expertise within the UK Space Agency/ESA
• size of organisation and corresponding match funding differential between the 2 routes

2. How to apply

2.1. The call process

The C-LEO programme will provide funding through a series of annual calls, with funding provided either through UK Space Agency-administered grants or ESA-administered contracts.

The table below sets out the expected timescales for this first annual call process:

Stage of call	Date
Expression of interest opens	27 March 2024
Expression of interest closes	8 May 2024
Applicants notified of outcome	Mid-May 2024
Deadline for applications submission	End of June 2024
Applicants notified of outcome	Mid-July 2024
ARTES applicants to register on ESA-STAR and complete ESA outline proposal	September 2024
National grants to be signed by	August 2024
ARTES applicants to complete ESA full proposal	November 2024

We ran an online webinar on 4 April 2024 which was recorded for those who were unable to attend. During the webinar, we went through how to fill in the EoI form.

Watch the recording of the webinar.

We will also be running an in-person networking event (date to be confirmed) as an opportunity for potential applicants to network, share ideas and build consortia.

2.2. Submitting an EoI form

This first C-LEO call will require applicants to complete a short online EoI form within a 6-week period. If the applicant is a consortium or collaborative bid, the lead partner should complete and return the EoI form.

This call is now open and online Expression of Interest forms should be completed by midday BST on Wednesday 8 May 2024. Proposals received after this time will not be considered.

This is a short form that asks for a high-level overview of the proposal. Guidance on completing the form is provided within the form itself. Any additional questions on how to complete this form should be sent via email to C-LEO@ukspaceagency.gov.uk.

Expressions of Interest will be reviewed by the UK Space Agency and any proposals removed that do not meet the project eligibility criteria. This could include the removal of proposals that do not target the 5 satellite communication technology areas that this call is focused on, or proposals from organisations that are not eligible for this funding support.

Applicants that are successful at the Expressions of Interest stage will then be invited to the application form stage and given 6 weeks to complete an application form.

Applicants will be asked to indicate within their Expressions of Interest whether they’d like their proposal to be considered for the national grant funding route, the ARTES contract route or both.

3. The application form stage

3.1. Submitting an application form

Applicants that are successful at the Expressions of Interest stage will need to complete the application form in full, which includes a number of annexes. These have been published online for transparency – please do not complete this application form and annexes until explicitly asked to by the UK Space Agency.

The full list of documents to be completed at the application form stage are as follows:

• Application form
• Annex A: Subsidy control (within the application form)
• Annex B: Milestone detail (within the application form)
• Annex C: Budget form
• Annex D: Catalysing Investment Assessment
• Annex E: Overheads form
• Annex F: National security questionnaire
• Annex G: Project Impacts form

In addition, applicants should read and understand the following guidance documents:

• Guidance note A: Grant application checklist
• Guidance note B: Frequently asked questions
• Guidance note C: Grant funding agreement template
• Guidance note D: Grant offer letter template
• Guidance note E: Overheads
• Guidance note F: Security extranets

All guidance notes should be read before completion of the application form.

3.2. How applications will be assessed

Completed application forms will be assessed by the UK Space Agency with the support of external reviewers.

As part of completing an application, applicants must review and accept the terms of the UK Space Agency’s published grant funding agreement (GFA) (Guidance note C).

Applicants may be asked for further evidence or clarifications after their application has been submitted.

The UK Space Agency reserves the right in its absolute discretion to: 

• waive or change the requirements, including the timetable, of this funding opportunity from time to time through a formal amendment, initiated by the Agency
• seek clarification in respect of a participant’s proposal
• disqualify any participant that does not submit a compliant proposal in accordance with the instructions in this funding opportunity
• disqualify any applicant that is guilty of misrepresentation in relation to its proposal or the proposal process
• withdraw this funding opportunity at any time, or to re-invite proposals on the same or any alternative basis
• disqualify applicants where support may conflict with the government’s foreign policy and international commitments or may pose a threat to national security
• choose not to support any proposal as a result of the proposal review process and the findings of due diligence (including sound financial management)

Financial checks will be undertaken, such as business viability, and all successful applicants will be expected to demonstrate sound financial and programme management procedures.

The criteria (and their respective weighting percentage) for the assessment of application forms will be as follows:

1. Disruptive technology: 10%

This will assess the potential for the proposed outputs to cause significant change to the space sector, for example through radically reducing costs or times, improving the quality of existing capabilities or creating entirely new capabilities and business models.   High scoring proposals will demonstrate they are comprehensive with excellent disruptive technology potential, enable the LEO supply chain and market, improve existing capabilities and enable new capabilities and business models.

Moderate scoring proposals will demonstrate positive disruptive technology potential, have a positive impact on the LEO supply chain and demonstrate potential to improve on existing capabilities.  

Low scoring proposals will demonstrate a minimal disruptive technology potential and minimal benefits to the LEO supply chain.

2. Catalysing investment: 15%

This will assess how this proposal demonstrates good value for money in terms of job creation, retention and investment into the UK Space economy. Specific metrics include:

• the amount of match funding provided
• additional revenue generated
• private investment generated
• internal investment of funds
• additional jobs created

There should also be provision of satisfactory evidence for wider economic, social or environmental benefits accruing to the UK public. There should be a satisfactory financial return to the UK space sector, including to the lead applicant and their partners and supply chains.

The bulk of the evidence for this criteria should be provided in Annex D, with additional comments within the application form.

High scoring proposals will provide excellent, detailed evidence of the benefits that the government funding would enable them to achieve and the impact on the UK economy, including excellent value for money, prospects for job generation and contract opportunities. This includes a coherent and coordinated strategy to catalyse investment through new investment or contract revenue and include a quantitative assessment as to the potential scale of additional revenue and investment unlocked because of further developing the project. The costs of any activities proposed for grant funding will be fully justified and clearly linked to the outcomes and benefits, articulating why public funding is essential to the project delivery. Risk, maturity and uncertainty will be well developed and clear in regard to the projects benefits and investment realisation plan.  

Moderate scoring proposals will provide some evidence of the benefits that the government funding would enable them to provide to the UK economy and some justifications for grant funding are adequately linked to outcomes and benefits. The proposal will include direction and aims to catalyse investment although without a robust strategy. The proposal will have an acceptable prospect of job generation, some value for private investment catalysed, some wider benefits to UK economy and some value for money.

Low scoring proposals will provide little, poor or no evidence of the benefits that the government funding would enable them to provide to the UK economy or the costs of any activities proposed for grant funding are poorly justified and not linked to outcomes and benefits. There will be little to no evidence of a strategy to catalyse investment, poor or no prospect of job generation, poor or no value for private investment catalysed, poor or no wider benefits to UK economy and poor or no value for money.

3. Innovation: 5%

This will assess what product, technology or service is being proposed, including whether it is novel or can be applied in a novel setting. Additionally, a demonstration of innovation in either the approach or the technology.

Consider whether the goal of the programme is challenging enough to warrant support, as well as whether it is a suitable innovation target.

High scoring proposals will provide a strong technical case with realistic project deliverables, including strong consideration given to the technical or scientific risks of the project. The case will outline how the proposed product or solution is novel or innovative. Highly innovative work proposed, new to space and very novel, excellent demonstration of technology benefits, alternative or additional applications for technology considered and incorporated in the proposal.

Moderate scoring proposals will provide a technical case with realistic project deliverables, with some information about the technical or scientific risks of the project. The case will include some information about how the proposed product or solution is novel or innovative. Some level of innovation proposed, relatively new to space or novel technology, fair demonstration to support UK government input.

Low scoring proposals will include a poor technical case with limited or unrealistic project deliverables, with little information about the technical or scientific risks of the project. Minimal or no information will be included about the technological development to date. There is no reference to the impact of technical risks on milestones. Limited or no information about how the proposed product or solution is novel or innovative. Unsuitable work proposed, not new to space or novel, poor demonstration of innovation.

4. Market readiness: 20%

This will assess the current and proposed technology readiness level (TRL) of the development. In addition, an assessment of the manufacturing readiness level (MRL) will be made to assess their plans and ability to manufacture at scale.

High scoring proposals will demonstrate high applicability to space, an excellent range of further applications or development, positive and widespread impact on others from this technology and timely activity.   

Moderate scoring proposals will demonstrate an applicability to space, good potential for further application, measurable benefit over alternative technologies, positive impact on others from this technology and timely activity.

Low scoring proposals will provide a basic technology concept / application formulated but significant further development required. Market opportunities are not addressed and minimal demonstration of an ability to volume manufacture the final product.

5. Project management: 15%

This will assess the fundamental project management of this project, including a methodical approach to cost, quality and schedule. In addition, there should be a well-considered approach to the project, with clear goals. Risks should be clearly identified, and mitigation strategies put in place.

High scoring proposals will demonstrate excellent project management, thorough Gantt chart and resources are completely considered.

Moderate scoring proposals will demonstrate an acceptable project management, adequate Gantt chart, resources are considered and the approach is well considered/thought through.

Low scoring proposals will provide limited detail about project management, undeveloped Gantt chart and resources are not considered.

6. Quality of team and proposal: 15%

This will assess the suitability, competence and experience of the team proposed to carry out the work described. It includes the established partner(s) in the proposal, the quality of that relationship, and any additional value this might generate for the UK space sector (for example, new supply chains, links to non-space sectors, new partnerships/consortia). The applicant should show that their proposal will increase the competitiveness and resilience of the UK LEO supply chain.

High scoring proposals will demonstrate an excellently written and structured, high-quality proposal, a quality team with highly relevant experience, excellent collaboration representing a good blend of experience and ability to support the project and clear and substantive added benefit to the UK space sector.

Moderate scoring proposals will demonstrate an acceptable quality of the proposal, acceptably written and structured, a team with experience in the field, good collaboration representing a blend of experience and ability to support the project and some added benefit to the UK space sector.

Low scoring proposals will provide a poor-quality proposal, poorly written and structured, a team with little experience in the field or completely new to the field, poor/limited collaboration that introduces some value to the project and no added benefit to UK space sector.

7. Business case and route to market: 20%

This will assess whether the bidder can demonstrate an application to space which fits into an existing or new business model. It includes an assessment of how detailed the market research and market share analysis has been. Letters of support can be provided and sent as PDFs along with the completed application form and annexes.

High scoring proposals will demonstrate a highly developed business case, route to market or exploitation plan along with thorough evidence of market share analysis and research.

Medium scoring proposals will have a partially developed business case, route to market or exploitation plan and some evidence of market share research.

Low scoring applications provide an unclear business case, route to market or exploitation plan and poor/incorrect analysis of market research.

To achieve the programme’s objectives, we will fund a balanced portfolio of high-scoring projects across a variety of technologies.

3.3. Project milestone and deliverables plan

Applicants must set out payment plans noting that:

• payments will be made in arrears on acceptance of progress reports, deliverables and final reporting
• payment to be made once costs have been incurred
• should actual costs incurred be greater than the value of the milestone value, these costs will be borne by the grant recipient, unless the additional expenditure has been agreed with the UK Space Agency ahead of the costs being incurred and a grant change notice (GCN) executed
• payment of the grant will be made in the form of staged payments together with a final payment on successful completion of the project. To reduce administrative burden please ensure a proportionate number of milestone linked payments
• the first milestone should reflect a significant stage in the project and cannot be made on completion of the kick-off meeting (T+0) as this is not eligible for a milestone payment value
• payment plans must be constructed to include and reflect major project stages and intermediate deliverables
• the work package structure should be outlined and clearly linked to the relevant milestone/deliverables, for example, through a Gantt chart or an equivalent project plan. Critical paths and dependencies should be outlined where possible

The milestone and work package plan will be captured using information in the financial template (Annex C) such as Gantt charts and further schedule details. 

3.4. Additional requirements

• all project members must have in place and provide evidence of appropriate anti-bribery and anti-corruption policies
• all project members must provide evidence of a process for declaring and managing conflicts of interest
• all project members must be able to provide evidence that they are GDPR compliant
• projects must comply with the security requirements laid out in the grant funding agreement -projects cannot work in areas that are in active conflict and any travel to overseas must comply with FCDO recommendations
• the UK Space Agency will not fund licensing or regulatory compliance activities, either in the UK or overseas
• projects must pass due diligence checks on company viability (financial standing assessment, governance, conflicts of interest, technical expertise)
• formal teaming, or equivalent agreements between project partners must be in place within 60 days of grant signature
• projects must comply with the rules stated in this guidance document both during the pre-award and post-award delivery period

4. Successful proposals to be funded by national grants

Applicants who are successful at the application form stage will also be informed whether they will be receiving funding support through UK Space Agency-administered national grants or through ESA-administered ARTES contracts.

For those successful applicants that will be receiving UK Space Agency-administered national grants, they will begin discussions with UK Space Agency on project definition and finalisation of their grant funding agreement (see Guidance Note C: Grant Funding Agreement template).

4.1. Grant funding agreement

Applicants must sign up to the grant funding agreement (GFA) terms as set out in the grant funding agreement. This is in Guidance Note C.

No material changes to the grant funding terms will be considered.

Minor changes may be considered if an applicant can demonstrate that agreeing to the provision within the grant funding agreement would result in the applicant breaching their statutory or regulatory obligations. Grant applicants wishing to propose changes should not make changes directly to the templates, but instead contact UK Space Agency via email at C-LEO@ukspaceagency.gov.uk to seek approval for any changes. This would need to be finalised prior to the award of funding.

The UK Space Agency requires that all partners in consortia sign a collaboration agreement (CA) within 60 days of grant commencement date. The CA should as a minimum reference the terms of the grant offer letter and GFA, specify the work division, intellectual property arrangements and a dispute rectification process. The UK Space Agency will, in the event of a dispute between partners, expect for the dispute to be resolved within the terms of the CA.

A draft grant offer letter (GOL) has also been included (Guidance Note D) to demonstrate the terms that successful applicants will be required to sign up to. This should be reviewed by applicants. Inclusion of the draft offer letter does not constitute any offer of work or payment by the UK Space Agency at this stage and is provided for information purposes only.

All organisations in receipt of UK Space Agency-administered grant funding must abide by the UK government Code of Conduct for Recipients of General Grants.

Grant payments will be made following successful completion of applicable milestones and will be made to the prime organisation only.

Milestone completion criteria will be agreed, linked to each milestone deliverable, with evidence required to demonstrate that each milestone has been completed successfully and costs have been expended in accordance with the principles set out in this document and the information in Annexes B and C. 

4.2. Match funding rates for national grants

Commercial organisations

Subsidies given under these categories are regarded as experimental development and subject to maximum subsidy ratios set out as follows:

Size of enterprise	Without enterprise collaboration uplift	With enterprise collaboration uplift (requires at least 1 small to medium-sized enterprise (SME) or at least one research and knowledge dissemination organisation)
Small	45% of the eligible project costs	60% of the eligible project costs
Medium	35% of the eligible project costs	50% of the eligible project costs
Large	25% of the eligible project costs	40% of the eligible project costs

For the purposes of subsidy control, the following definitions are applicable:

• a small enterprise has an annual turnover below £10.2 million, a balance sheet total below £5.1 million and the average number of employees must not be more than 50
• a medium enterprise has an annual turnover below £36 million, a balance sheet total below £18 million and the average number of employees must be no more than 250
• a large enterprise has an annual turnover above £36 million, a balance sheet total above £18 million and the average number of employees is above 250

To qualify, 2 of the 3 conditions in the above definition must be met.

As the table above makes clear, enterprises may receive a 15% uplift to the subsidy ratios where the project involves collaboration (‘collaborative uplift’):

• between enterprises where at least 1 of the enterprises is an SME
• between an enterprise and 1 or more research and knowledge dissemination organisation, which must have the right to publish its own research results

This uplift can be applied if your collaboration involves international entities.

In exceptional circumstances, the UK Space Agency reserves the right to adjust the value or duration of the grant funding available. No more than 10% of the total grant value can be spent on travel and subsistence.

If your proposed project involves a consortium of project partners (ie, more than 1 organisation contributing to delivery), then match funding in this call is required from each participant within the consortium at the relevant level. For example, a project involving a medium enterprise and 2 small enterprises can apply the uplift for collaboration, meaning the medium enterprise is required to contribute 50% match funding and the small enterprises are required to contribute 40% match funding each.  

Subcontractors are not required to provide match funding, but all subcontractor costs should be included on a cost recovery basis. A maximum of 50% of the total grant award can be spent on subcontracting costs.

Research organisations

Please note in this call that only 30% of the total grant funding can be awarded to research organisations.

Research organisations engaged in economic activity (ie, putting goods or services on the market) as part of their project will be treated as commercial enterprises as per the section above.

When referring to research organisations, the UK Space Agency uses the definition from the framework for state aid for research and development and innovation which states:

‘research and knowledge dissemination organisation’ or ‘research organisation’ means an entity (such as universities or research institutes, technology transfer agencies, innovation intermediaries, research-oriented physical or virtual collaborative entities), irrespective of its legal status (organised under public or private law) or way of financing, whose primary goal is to independently conduct fundamental research, industrial research or experimental development or to widely disseminate the results of such activities by way of teaching, publication or knowledge transfer. Where such entity also pursues economic activities, the financing, the costs, and the revenues of those economic activities must be accounted for separately. Undertakings that can exert a decisive influence upon such an entity, for example in the quality of shareholders or members, may not enjoy a preferential access to the results generated by it.

Within the UK Space Agency, this means:

• universities
• non-profit research and technology organisations (RTOs), including catapults
• public sector organisations (PSOs)
• public sector research establishments (PSREs)
• research council institutes
• research organisations (ROs)
• charities

This list is not comprehensive and is subject to change and exceptions.

Research organisations undertaking non-economic activity will be funded as follows:

• universities: up to 80% of full economic costs
• all other research organisations: up to 100% of eligible costs

Research organisations should be non-profit distributing to qualify. They should explain how they will disseminate the output of their project research as outlined in the application.

4.3. Subsidy control

The UK Space Agency supports organisations to invest in research, development and innovation. The support we provide is consistent with the UK’s international obligations and commitments to subsidy control. The UK is now under a national subsidy control regime, but in certain circumstances European Union State aid rules may apply.

It is the responsibility of all applicants to ensure that they are complying with the relevant subsidy control requirements and you may need to seek your own independent legal advice. 

Before providing C-LEO funding support as national grants, the UK Space Agency must ensure that the subsidy scheme meets the terms of the principles as determined in the Subsidy Control Act 2022. 

Specific conditions for applicants in Northern Ireland

Applicants based in Northern Ireland will be subject to European Commission State Aid rules rather than the Subsidy Control Act 2022. Grant information for successful Northern Irish applicants will be published in the European Commission State Aid transparency database.

It is important to note that state aid policy is currently the responsibility of the European Union. The European Court of Justice holds sole competence over the presence of state aid or otherwise.

The subsidy control regime is based on where the economic activity is undertaken, rather than where the organisation itself is registered.  For example, activity undertaken in England by a Northern Irish company would be subject to the Subsidy Control Act, rather than state aid.

Where state aid applies, UK Space Agency expects C-LEO projects to fall within the General Block Exemption Regulations (GBER) Article 25, though your proposal should identify the correct state aid treatment for your project.

The UK Space Agency is unable to award grant funding to organisations meeting the condition known as undertakings in difficulty. State aid rules consider an undertaking to be in difficulty in a number of circumstances, as defined by GBER regulations. You should pay particular attention to the situation where more than half of an undertaking’s subscribed share capital has disappeared as a result of accumulated losses. This is the case when deduction of accumulated losses from reserves (and all other elements generally considered to be part of the funds owned by the company) leads to a negative cumulative amount that exceeds half the value of subscribed share capital.

For the purposes of this provision, ‘limited liability company’ refers in particular to the types of company mentioned in Annex I of Directive 2013/34/EU (1) and ‘share capital’ includes, where relevant, any share premium. This rule applies to all limited liability undertakings except an SME less than 3 years old. For more detail read about undertakings in difficulty.

However, the information given is not a substitute for taking legal or professional advice, which is the responsibility of the applicant. We cannot accept any liability for actions arising from the use of our guidance. the UK Space Agency cannot be held responsible for the contents of any pages referenced by an external link.

If the European Commission considers a business or any undertaking to have been in receipt of state aid due to ineligibility for exemption under GBER, that undertaking is likely to be required to repay any aid received to the value of the gross grant equivalent.

4.4. Costs and expenditure

Cost recovery

The funds from grant funding are on a cost recovery basis only. Grants are solely intended to cover the cost of delivering the agreed activity or goal. Any surplus funds not spent will be lost to the project unless there are alternative arrangements agreed.

Grantees cannot receive any funding from other grants/contracts to undertake the same activities.

Grant funding cannot be rolled over between financial years without explicit consent from the UK Space Agency.

All partners must use a separate, project-specific, bank account or project accounting code for project funds to enable a clear audit trail.

Eligible expenditure

Invoicing

The UK Space Agency will only pay on actuals therefore we expect invoices may differ from forecasts. Should actual costs incurred be greater than the value of the milestone value, these costs will be borne by the grant recipient, unless the additional expenditure has been agreed with the UK Space Agency ahead of the costs being incurred and a grant change notice (GCN) executed. The invoice should exclude VAT. See further invoicing and milestone guidance template in Annex C, Annex E and Guidance Note E.

Staff costs

Staff costs must be calculated on a cost recovery basis only and broken down by pay costs and overheads separately.

Pay costs

Pay costs are calculated based on your PAYE records. This is to include gross salary, employer National Insurance (NI) contributions and employer pension contributions. For any PAYE elements outside of that please check eligibility ahead of applying. Non-PAYE costs or pay allocated margins or cost allocations are not eligible. Examples that are ineligible include but are not limited to:

• any profit margins
• commercial charge-out rates
• allowances for bonuses and benefits in kind
• business development

These pay rates will be subject to checks during the negotiation stage by internal or external teams to ensure that day rates reflect actual costs. High payroll costs will be challenged and evidence (such as pay slips) must be provided to justify that the rate is on a cost recovery basis only.

When making grant claims against labour costs, actual costs claimed must be supported with timesheets of those individuals who have worked on the project. If this level of detail is not achievable then any other arrangements should be agreed in writing during the due diligence checks and subject to Agency approval.

In the budget breakdown in Annex C, you are asked to provide a pay cost per day. Using actual gross monthly payroll costs, please assume 260 working days in the year, less annual leave and public holiday entitlements.

Overheads

Full overhead recovery or full absorption costing is not eligible.

We understand that organisations calculate overheads in different ways. This section offers 4 options for overhead costs:

1. no overheads. You can select this option if you are not incurring or claiming grant for your overheads
2. the 20% of labour costs option allows you to claim 20% of your project pay costs as overhead. This includes both direct and indirect overhead. Selecting this option allows us to review a successful grant application much faster as no further documentation is needed from you
3. the calculate overheads option asks you to complete calculations for claiming direct and indirect overheads. Any value claimed under this method will need to be reviewed by our project finance team if your application is successful. This is so we can assess the appropriateness of the overhead value you are claiming
4. where an organisation qualifies and applies for full economic cost (FEC) recovery, your application should be supported by the latest signed off transparent approach to costing (TRAC) return or equivalent financials to support the requested amount. Academic partners will be funded in all cases at 80% of FEC

Please note that once the overhead is calculated and approved it cannot be exceeded at any time throughout the project life.

For option 3 you must complete the overhead calculation spreadsheet and return with your application form. Full guidance and the spreadsheet are provided in Annex E and Guidance Note E.

VAT rules

Where money is given freely to an activity and the donor receives nothing tangible in return, the activity is treated as non-business for VAT purposes and is outside the scope for VAT. The UK Space Agency grant funding is outside the scope for VAT. Any VAT incurred within the project costs cannot be passed to the UK Space Agency. This includes both input and output VAT whether recoverable or non-recoverable from HMRC.  

Travel and subsistence

The following outlines the guidelines for travel and subsistence costs. Value for money must always be considered. If for any reason the set limits cannot be adhered to (for example, to accommodate a reasonable adjustment), you must seek prior written approval from the UK Space Agency. No claims for alcohol will be accepted.

The UK Space Agency reserves the right to not settle claims which have breached these guidelines. All expenditure must be supported by actual, itemised receipts.

Limits:

• accommodation: £140 per night
• breakfast: £5.50
• lunch: £5.50
• dinner: £16.50

Travel:

• all travel claimed must be using economy rates
• tolls, ferry costs, parking and congestion charge: receipted costs for ferries, and tolls bridges and roads unavoidably incurred during your business journey may be claimed. Reasonable parking charges may be claimed. Receipted congestion charges unavoidably incurred on your business journey may be claimed.

Ineligible expenditure

The following costs are ineligible: 

• payment that supports for lobbying or activity intended to influence or attempt to influence Parliament, government or political parties, or attempting to influence the awarding or renewal of contracts and grants, or attempting to influence legislative or regulatory action
• using grant funding to petition for additional funding
• payments for activities of a political or exclusively religious nature
• goods or services that the grant recipient has a statutory duty to provide
• payments reimbursed or to be reimbursed by other public or private sector grants
• contributions in kind (ie, a contribution in goods or services, as opposed to money)
• depreciation, amortisation or impairment of fixed assets owned by the grant recipient
• the acquisition or improvement of fixed assets by the grant recipient (unless the grant is explicitly for capital use – this will be stipulated in the grant offer letter)
• interest payments (including service charge payments for finance leases)
• gifts to individuals
• entertaining (entertaining for this purpose means anything that would be a taxable benefit to the person being entertained, according to current UK tax regulations)
• statutory fines, criminal fines or penalties, or liabilities incurred before the issue of this funding agreement unless agreed in writing by the UK Space Agency
• employee paid benefits and bonuses
• alcohol

4.5. Due diligence

The UK Space Agency will conduct due diligence on grant applications as required using internal and, where necessary, external subject matter experts. The scope and degree of due diligence will be determined by the value, nature and complexity of the grant scheme. All applications will be subject to basic checks such as credit reports and Companies House checks. 

Post-award due diligence

Post-award due diligence may include, but is not limited to:

• technical assessment of milestone deliverables against acceptance criteria to allow milestone payments to be released
• financial: assessment of expenditure for each milestone payment and reporting on planned costs, follow up review of financial standing/health if it is a multi-year project
• commercial: change management including any variations to time, cost, scope, or GFA terms; review of milestone deliverables as required
• programmatic: project progress and impacts of any delays, risk assessment and mitigation activity
• end of project review: has the technical and economic value been realised? Lessons learned and continuous improvement
• UK Space Agency-commissioned and funded financial audit of grant recipient and costs (if applicable project partner)

Grant applicants who opt to work with project partners (ie, organisations involved in delivery of the project under a flow down agreement rather than a subcontractor), will assume all responsibility for partner due diligence.

Applicants will need to demonstrate they have carried out a sufficient level of due diligence with regard to their proposed project partners and subcontractors. Applicants will need to demonstrate they have carried out minimum checks at proposal stage, which may require further scrutiny if the proposal is to be funded.

To meet this requirement, applicants can provide evidence of due diligence carried out supported by the resulting information or submit a partner reasonable assurance statement. The evidence should be consistent with the checks that we would conduct on our grant recipients, for example, financial standing, technical ability and scrutiny of the breakdown of costs. Any costs associated with project partner due diligence is considered a bidding cost and is to be borne by the applicant.

Applicants must provide evidence that they, and project partners have in place of appropriate anti-bribery and anti-corruption internal policies, and a process for declaring and managing conflicts of interest. 

Annual audit of project costs

All grant awards greater than £250,000 may be subject to an external annual audit to ensure that costs claimed from the grant funding have been expensed on agreed project related expenditure and comply to UK Space Agency grant funding policies (eg, match funding). The auditor will be appointed by the UK Space Agency. All subcontractors and partners must provide access to project relevant expenditure. Therefore, grant recipients must maintain, and be able to provide upon request, any supporting evidenced as deemed necessary, such as:

• timesheets (prime and, where applicable, partners)
• staff costs (contractors)
• all receipts (including travel and subsistence)
• all partner and subcontractor invoices
• breakdown of overhead costs
• breakdown of capital usage (eg, licence, data costs)

The UK Space Agency reserves the right to conduct ad-hoc audits throughout the life of the project.

4.6. Reporting requirements

Following an award and completion of grant agreement formalities, projects will be expected to start as soon as possible, and no later than 3 weeks after grant signature. The UK Space Agency will assign a project coordinator to oversee the projects with the following methodology: 

• the project coordinator will initiate each project normally by teleconference via a kick-off meeting which should be accompanied by a short presentation on the project by the project team
• the grant recipient will provide short progress reports to the coordinator, and the schedule for these will be agreed at the project kick-off meeting and are normally at 4 or 6 weeks. A template will be made available at kick off
• the grant recipient will schedule a mid-term progress meeting, as well as any with the project coordinator. projects should include other technical review points (eg, preliminary/critical design reviews) to enable planning and obtaining of relevant expert input
• the grant recipient will provide milestone/deliverables within the proposal using the template provided in Annex C
• the grant recipient will provide reporting on the progress of the project to evidence the milestone/deliverable has been met. On acceptance from the project coordinator of the evidenced milestone/deliverable and supporting financial evidence, the grant recipient will be invited to provide an invoice detailing the spend against each budgetary category for that milestone/deliverable
• at the end of the project, a final report (not containing intellectual property) and an executive summary are to be provided to the UK Space Agency. The executive summary must not contain any confidential information, as this may be uploaded onto the UK Space Agency website. All other reports should be marked ‘commercial in confidence’ where applicable.

5. Successful proposals to be funded by ARTES contracts

Applicants who are successful at the application form stage will be informed whether they will be receiving funding support through UK Space Agency-administered national grants (see section 4 above) or through ESA-administered ARTES contracts.

For those applicants that secure provisional approval for an ESA-administered ARTES contract, they can start the process of applying to ESA. Applicants in this position will be provided with further guidance and support from the UK Space Agency.

Please check the ESA eligibility rules before applying. Further details about how to apply to ESA can be found here.

5.1. Match funding rates for ARTES contracts

Commercial organisations

Subsidies given under these categories are regarded as experimental development and subject to maximum subsidy ratios set out as follows:

Technology readiness level (TRL)	Maximum funding level for small and medium enterprises	Maximum funding level for large enterprises
Up to 9	75%	50%

In exceptional circumstances, the UK Space Agency reserves the right to adjust the value or duration of the contract funding available. No more than 10% of the total contract value can be spent on travel and subsistence.

If your proposed project involves a consortium of project partners (ie, more than 1 organisation contributing to delivery), then match funding in this call is required from each participant within the consortium at the relevant level. For example, a project involving a large enterprise and 2 small enterprises will mean that the large enterprise is required to contribute 50% match funding and the small enterprises are required to contribute 25% match funding each. 

Research organisations

Please note in this call that only 30% of the total contract funding can be awarded to research organisations.

Research organisations engaged in economic activity (ie, putting goods or services on the market) as part of their project will be treated as commercial enterprises as per the section above.

When referring to research organisations, the UK Space Agency uses the definition from the framework for state aid for research and development and innovation which states:

‘research and knowledge dissemination organisation’ or ‘research organisation’ means an entity (such as universities or research institutes, technology transfer agencies, innovation intermediaries, research-oriented physical or virtual collaborative entities), irrespective of its legal status (organised under public or private law) or way of financing, whose primary goal is to independently conduct fundamental research, industrial research or experimental development or to widely disseminate the results of such activities by way of teaching, publication or knowledge transfer. Where such entity also pursues economic activities, the financing, the costs, and the revenues of those economic activities must be accounted for separately. Undertakings that can exert a decisive influence upon such an entity, for example in the quality of shareholders or members, may not enjoy a preferential access to the results generated by it.

Within the UK Space Agency, this means:

• universities
• non-profit research and technology organisations (RTOs), including catapults
• public sector organisations (PSOs)
• public sector research establishments (PSREs)
• research council institutes
• research organisations (ROs)
• charities

This list is not comprehensive and is subject to change and exceptions.

Research organisations undertaking non-economic activity will be funded as follows:

• universities: 100% (up to 30% of the total project cost)
• all other research organisations: up to 100% of eligible costs

Research organisations should be non-profit distributing to qualify. They should explain how they will disseminate the output of their project research as outlined in the application.

Exchange rates

Successful applications under the ESA-administered ARTES contracts route will need to comply with the ESA requirements highlighted in the financial proposal. Further information can be found on ESA’s website.

Currency and Conversion Rates
Financial proposal(s) shall be presented in Euros.
For any tenderer or proposed subcontractor(s) located in countries not participating in the Euro, the exchange rate shall be stated in the PSS forms and shall be clearly explained in Exhibit A to form PSS-A2. Any other factors (eg, hedging costs, forward buying rates, etc) used for the purpose of its calculation shall be indicated.
The tenderer shall summarise, in this section, the conversion rates applied (if any) and explicitly state that the required details have been provided in form PSS-A2 and its Exhibit A for the countries/entities concerned.
Should the countries to which tenderer(s) belong adopt the Euro following the submission of the proposals, the applicable conversion rates shall be those then adopted by the appropriate european authorities.
The tenderer shall state its acceptance of the definition of the applicable conversion rates should the countries to which tenderers belong adopt the Euro following the submission of the proposals.

5.2. Additional ESA contract steps

Submitting an application for National Delegate support

If you are successful through the expression of interest and application stages, and are selected to proceed through the ESA ARTES route, you will then need to apply for an ESA contract award. To do this, you must submit an outline proposal to ESA by the closing date stipulated in the National Delegate approval outcome.

What is National Delegate support 

Applicants must demonstrate national support prior to applying to ESA. This is called ‘National Delegate support’, as the UK delegates its national support to a named member of staff within the UK Space Agency. A successful application to the UK Space Agency C-LEO programme will result in provisional National Delegate Support.

Registering with ESA

Successful applicants will need to register their entity on ESA-STAR (ESA’s System for Tendering And Registration) before proceeding through the ESA ARTES route. Read further information on the registration process.

Provisional National Delegate support

Once you have received this approval, your proposal can be progressed with ESA. You will be invited to submit an outline proposal to ESA. Once they have reviewed and if ESA are content, ESA will invite you to submit a full proposal.

ESA full proposal

You will need to submit your full proposal to the UK Space Agency in the first instance. We will review your documents to ensure that they are aligned with the application you submitted at the previous stage.

Once this review is complete, we will issue the authorisation of funding letter to ESA setting out our funding support. We will send you a copy, too. Once you have received this letter, you can then submit your full proposal to ESA, who will begin their formal consideration.

Please note, if you do not provide the required information by the date agreed, you may not receive your letter in time.

We expect you to stay in touch throughout the life of the programme, from contracting to completion. We expect to publicise most funding awards in coordination with winning companies and to be kept informed of any changes or developments for the duration of the project. This ensures we can support you if any adjustments are needed.

If you have any questions about the status of an existing ARTES project, please contact the team via email on telecoms@ukspaceagency.gov.uk.

Please note, as previously stated, ESA will award contracts rather than grant funding and an additional application to ESA will be required if selected for UK National Delegate support.

5.3. Costs and expenditure

Cost recovery

The funds from contract funding are on a cost recovery basis only. Contracts are solely intended to cover the cost of delivering the agreed activity or goal.  Any surplus funds not spent will be lost to the project unless there are alternative arrangements agreed.

Contractors cannot receive any funding from other grants/contracts to undertake the same activities.

Contract funding cannot be rolled over between financial years without explicit consent from the UK Space Agency.

All partners must use a separate, project-specific, bank account or project accounting code for project funds to enable a clear audit trail.

Expenditure

Travel and subsistence

The following outlines the guidelines for travel and subsistence costs. Value for money must always be considered. The UK Space Agency will only support reasonable travel and subsistence costs. No claims for alcohol or entertainment will be accepted.

All projected expenditure must be recorded in the relevant ESA proposal. The UK Space Agency reserves the right not to support projects where costs appear excessive, and any challenges may delay your application to ESA.

The UK Space Agency reserves the right to not settle claims which have breached these guidelines. All expenditure must be supported by actual, itemised receipts.

If you are in any doubt about what is reasonable you should contact the team.

Essential non-UK spend requests

Products and services from non-UK suppliers that are considered essential to deliver successful projects may be included in proposals. However, all proposals must demonstrate their value to the UK and non-UK spend requests are unlikely to score highly against other, UK-based activities. Any non-UK spend requests should be clearly stated in your initial application. Late requests will not be considered if they have not been declared and approved at the applications stage.

Ineligible expenditure

The following costs are ineligible: 

• payment that supports for lobbying or activity intended to influence or attempt to influence Parliament, government or political parties, or attempting to influence the awarding or renewal of contracts and grants, or attempting to influence legislative or regulatory action
• using contract funding to petition for additional funding
• payments for activities of a political or exclusively religious nature
• licensing or regulatory compliance activities, either in the UK or overseas, including spectrum filings
• goods or services that the contract recipient has a statutory duty to provide
• payments reimbursed or to be reimbursed by other public or private sector contracts or grants
• contributions in kind (ie, a contribution in goods or services, as opposed to money)
• depreciation, amortisation or impairment of fixed assets owned by the contract recipient
• the acquisition or improvement of fixed assets by the contract recipient (unless the contract is explicitly for capital use – this will be stipulated in the authorisation of funding letter)
• interest payments (including service charge payments for finance leases)
• gifts to individuals
• entertaining (entertaining for this purpose means anything that would be a taxable benefit to the person being entertained, according to current UK tax regulations)
• statutory fines, criminal fines or penalties, or liabilities incurred before the issue of this funding agreement unless agreed in writing by the UK Space Agency
• employee paid benefits and bonuses
• alcohol

5.4. Due diligence

The UK Space Agency and ESA will conduct due diligence on contract applications as required using internal and, where necessary, external subject matter experts. The scope and degree of due diligence will be determined by the value, nature and complexity of the contract. All applications will be subject to basic checks such as credit reports and Companies House checks. 

Post-award due diligence

Post-award due diligence may include, but is not limited to:

• technical assessment of milestone deliverables against acceptance criteria to allow milestone payments to be released
• financial assessment of expenditure for each milestone payment and reporting on planned costs, follow up review of financial standing/health if it is a multi-year project
• commercial change management including any variations to time, cost, scope, or contract terms; review of milestone deliverables as required
• project progress and impacts of any delays, risk assessment and mitigation activity
• end of project reviews - has the technical and economic value been realised? Lessons learned and continuous improvement
• UK Space Agency-commissioned and funded financial audit of contractor and costs (if applicable project partner)

Contractors who opt to work with project partners (ie, organisations involved in delivery of the project under a flow down agreement rather than a subcontractor), will assume all responsibility for partner due diligence.

Applicants will need to demonstrate they have carried out a sufficient level of due diligence with regard to their proposed project partners and subcontractors. Applicants will need to demonstrate they have carried out minimum checks at proposal stage, which may require further scrutiny if the proposal is to be funded.

To meet this requirement, applicants can provide evidence of due diligence carried out supported by the resulting information or submit a partner reasonable assurance statement. The evidence should be consistent with the checks that we would conduct on our contractors, for example, financial standing, technical ability and scrutiny of the breakdown of costs. Any costs associated with project partner due diligence is considered a bidding cost and is to be borne by the applicant.

Applicants must provide evidence that they, and project partners have in place of appropriate anti-bribery and anti-corruption internal policies, and a process for declaring and managing conflicts of interest. 

6. Further guidance

6.1. Value for money assessment

The UK Space Agency works to ensure that our investment in space brings about real benefit to the UK and its people.  As part of this, our principal metric by which the UK Space Agency measures its success, the North Star Metric, is the level of total investment and contract revenue we help to bring into the UK space sector. This helps us to ensure we are delivering the National Space Strategy, and informs how we prioritise our resource, select the projects we invest in, and make the case for future public spending on space.

What is the North Star Metric?

The North Star Metric is a quantitative metric which measure the level of revenue and investment in the UK Space Sector which can be attributed to UK Space Agency supported. Data is gathered as an agreed requirement of UK Space Agency grants and contracts from the recipients of those grants and contracts.

Why is this data being collected?

The UK Space Agency works to ensure that our investment in space brings about real benefit to the UK and its people. The North Star Metric forms a part of the data collection from projects to help the UK Space Agency assess the public value for money of proposals,

Consistent monitoring and evaluation of our programmes is vital so we understand how well we are delivering the UK Space Agency’s objectives. This in turn helps us to ensure we are delivering the National Space Strategy, and informs how we prioritise our resource, select the projects we invest in, and make the case for future public spending on space.

We therefore require, as a condition of funding, that all recipients report the benefits they receive as a result.

The data allows the Agency to show the benefits of the UK Space Sector and UK Space Agency spending, these benefits justify UK Space Agency spending.

The North Star Metric forms a part of the of the project data collection, and the data collected will help to inform the assessment of the ‘catalysing investment’ evaluation criteria.

What data will be collected?

Reporting will primarily involve four key elements:

• match funding realised
• new internal investment above match funding
• total private investment
• FTE jobs created and protected

This information will be collected via the table in Annex D. Please note that data will not be shared with other companies and that it will be held securely in an anonymised form so that you cannot be directly identified.

In addition, as detailed in Annex D proposals are asked to provide further contextual information to help understand wider economic and social benefits that are expected to arise due to project funding. Expected benefits should be described and, where appropriate and possible, quantified, within applications.

6.2. Project impact monitoring

The UK Space Agency is a public body, and it is natural that there is increasing scrutiny of our investments. The government expects, and the public deserves, visibility on how this money is being spent. We want to show the impact that UK Space Agency investments are having for our innovative companies, and most importantly how they are helping to achieve our national goals.

To help quantify these impacts the UK Space Agency is expanding its monitoring and evaluation framework, with the aim of collecting data annually from our applicants and funded partners via the ‘project impact’ questions. The data will be aggregated to help build a complete picture of the impact the businesses, organisations, and individuals we support are making to the wider UK economy and society.

The project impact questions help quantify the impact of UK Space Agency-funded programmes. The data will be aggregated to help build a complete picture of the impact the businesses, organisations, and individuals we support are making to the wider UK economy and society. By providing regular and quality impact data to the UK Space Agency, organisations are enabling the UK Space Agency to better understand the impact of our support. It will help us identify success stories and provide evidence to government and the public of the value of supporting innovative businesses. This evidence will also allow the UK Space Agency to design compelling future programmes that will support space investment in the areas with the most impact for the UK economy, the wider society, and the environment.

In the future we also aim to provide data and insights back to our customers. This will give them a greater understanding of their project and business compared to others, helping them to grow and demonstrate their successes.

Please note that answers provided to the project impact questions are not a substitute for the information provided in Annex D, which will inform the UK Space Agency’s assessment of the ‘catalysing investment’ criteria (see above). The data collected via project impact questions are not scored and do not form any part of the assessment of your application.

Applicants are asked to complete the project impact questions within the UK Space Agency application form and Annex G.

As a condition of funding, projects will be asked to review and update their answers to these questions throughout the project and after it has finished. This is to enable recipients and the UK Space Agency to monitor and evaluate the impact of the project. The monitoring is most likely to happen on an annual basis and will be designed to minimise the burden on grant recipients. We will make use of administrative data from regular project reporting to reduce the need of providing the same data more than once. There may be occasions where we would change questions or methods of data collection to ensure it is the most suitable for the programme.

Your data will be treated in strict confidence in line with the provisions of Section 39 of the Statistics and Registration Services Act 2007, Data Protection Legislation (including the General Data Protection Regulation and the Data Protection Act 2018) and the Code of Practice for Statistics.

6.3. National security

The threat to space is real and coming increasingly closer to the UK space industry as attempted breaches have demonstrated. Everyone needs to protect assets and services from adversaries, incorporating Secure by Design principles as projects, processes and systems are developed. Demonstrating a commitment to security is critical to the ongoing success of any business. Ensuring secure, robust and recoverable services and services can provide a competitive advantage in the marketplace and avoids unnecessary costly retrofitting.  

The UK Space Agency works with the space industry to improve security and resilience to attack. For this to be achieved grant recipients must satisfy the below.

Stage 1:  

As part of the application process applicants must complete the National Security questions at Annex F and return as part of the grant application.

Where there is a consortium of partners included on a project, the questionnaire should be completed in the name of the lead partner. Only those deemed successful at the grant stage will be engaged by the UK Space Agency National Security team. 

All successful grant recipients must:  

Stage 2a:  

Apply for a free login for the UK Space Agency security extranet (Resilience Direct- See Guidance Note F for further guidance) to obtain security alerts and other communications. Access guidance and other useful information tailored for the space sector.  

Stage 2b:  

Undertake measures that are appropriate and proportionate for the purposes of identifying the risks of security compromises occurring.  Plans detailing how this will be achieved must be submitted to resilience@ukspaceagency.gov.uk by 1 month of grant commencement.   

Stage 3: 

Undertake measures that are appropriate and proportionate for the purposes of:

1. reducing the risks of security compromises occurring
2. preparing for the occurrence of security compromises. 

Mitigation, response and recovery plans must be submitted to resilience@ukspaceagency.gov.uk within 6 months of the grant funding agreement being signed. Plans should include an annex or separate plan (proportionate to the company/project size and level of risk) detailing specific activity planned in response to a cyber security attack. 

Contents of plans  

The security questions at Annex F and completed at the start of this funding provides a summary of what is expected within plans. Other guidance can be found on the secure extranet as covered at stage 2a and the National Cyber Security Centre.

Please contact resilience@ukspaceagency.gov.uk for any advice and assistance. 

6.4. Confidentiality

The procedure for handling and assessing the bids and notifications will be as follows: 

• all proposals and notifications will be held in confidence by UK Space Agency, except to be shared with evaluation panellists
• information relating to the proposals may also be shared with other UK government departments, agencies and arm’s length bodies
• summary information on all successful proposals who receive grant funding will be made public, including the summary of the proposal (from the application form), the amount of grant funding awarded and the identities of organisations involved
• for those bids not recommended by for funding, documentation will be retained by the UK Space Agency for reference. The proposals will not be visible to any others, and the names of any unsuccessful bidders will not be published
• all other documentation relating to bids selected for funding will remain confidential within the UK government

Information submitted as part of a proposal, or subsequent commercially sensitive information submitted as part of the grant agreement, will not be disclosed by us save for in so far as we consider necessary, in our absolute discretion, to comply with our legal obligations under the Freedom of Information Act 2000, Environmental Information Regulations 2004 or any other legal act, requirement or obligation. Where permitted by law, we will attempt to notify you of any such disclosure. 

6.5. Data protection

How will the data be collected?

When beginning the grant recipients will be asked to provide name and contact details of the person in your organisation who will be responsible for providing this information.

The data is to be reported at regular grant or contract management meetings on no less than every 6 months from the start of the activity covered by this agreement.

At the end of the grant or contract period the grant manager will decide a reasonable date with the grant or contract recipient at which time further data collection will be reasonable. Data will be required for at least 5 years after the completion of the activity covered by this agreement.

Where the length of benefit realisation would be longer than 5 years, the UK Space Agency may require an extended reporting period. This is to ensure that we are capturing the full benefits of an activity that has a long time period before those benefits are realised. Where this is the case the UK Space Agency will agree with grant recipients beforehand at the time at which a further request for information is sensible.

How will data privacy be maintained?

The information provided will only be used by the UK Space Agency and not shared with any other parties. Aggregate information may be presented more widely but this will be fully anonymised and not be attributable to any individual organisation.

In addition, this information is being used to assess the Agency’s impact on the space sector and is not intended to be used as a way to evaluate how the grant is being managed.

Definitions of the data to be collected

The below table contains definitions for the data we are looking to collect. Information should be reported both on financial information from the grant or recipients own company but also, if known, other companies who may have benefited from the grant or contract (for example, spinout companies that have been able to take advantage of a new technological development).

Direct benefits should always be reported. Follow-on or spillover benefits should also be reported where there is strong evidence that the spillover benefit would not have occurred in the absence of UK Space Agency funding and is attributable to the grant or contract.

Term	Definition
Private investment	Money invested by companies, individuals, or financial organisations through the following vehicles: equity; grant; prize; debt or alternative finance sources, excluding funding provided by the UK Space Agency directly or via ESA. The source of the investment can be either foreign or domestic.
Internal investment	Investment within a company, or from a parent company to its subsidiary, to cover R&D, capital expenditures and other non-capital expenditures such development of intellectual property.
Total income	Additional income generated from creation of goods and services, as a result of the specified grant or contract. In the longer term this may also include income generated from royalties and licenses.

Attribution to UK Space Agency support

Data should only be reported where it could be reasonably stated that the revenue and/or investment in question would not have occurred without the UK Space Agency’s funding. Where the revenue and/or investment may have only been partially realised in the absence of the UK Space Agency’s funding, best efforts should be made to estimate the proportion of contract revenue and/or investment which can have been said to have occurred as a result.

Examples of information that should be reported

Private investment:

• equity investment from a venture capital fund which can be attributed to the development of a new technology funded by the grant or programme
• awarding of a grant from non-government organisations to further develop an idea which was initially funded by the grant or contract
• foreign direct investment that can be attributed to a company experiencing growth as a direct result of receiving the UK Space Agency grant or contract

Internal investment:

• a parent company diverting funds toward the company to aid in the delivery of the programme originated by the grant or contract
• the purchase of large capital equipment to further research initially aided by the grant or contract
• investment of R&D funds within the company to exploit and idea initially proposed as part of the grant or contract programme

Total income:

• direct sales of any good or services which have been developed by grant or contract funding
• income of spinout companies which have been established using a technology developed by the grant or contract funding
• total income of sub-sectors of the space market which have been newly developed as a result of the grant or contract funding
• partial attribution of the revenue received from a future government contract which would not have been won without the development of a technology developed as part of the grant or contract programme

Additional impact on investment that cannot be quantified:

• a qualitive description of the investment benefit generated from grants which have a negligible direct impact on investment, but these grants are critical to compliment company technology strategies
• a description of how the human capital improvements brought about by the grant or contract would lead to a more highly skilled workforce attracting investment in the UK space industry from foreign investors
• an assessment of how a technology developed by the grant has led to wider developments in the technological ecosystem which have generated their own investments and revenue

Examples of information that should not be reported

Private investment:

• grant funding received from the UK Space Agency – the Agency does not measure it’s grants success by the awarding of further grant in the future
• full attribution of equity investment that can only be partially attributed to the grant or contract – if a grant or contract contributed to but is not the direct cause of receiving the investment then best efforts should be made to state the exact contribution of the grant or contract

Internal investment:

• match funding invested as a requirement of the grant – this information should be reported but in the separate field provided
• funds redirect to divisions within organisations which in truth would have gone ahead without the grant or contract funding – if the grant or contract is part of a wider programme or division which receives additional funding this should only be counted if there is strong evidence these funds would not have been reallocated without the grant or contract being received

Total income:

• grant or prize funding received from government or non-government organisations - this is considered private investment
• the value of the grant or contract itself – this should be reported in the separate field provided

Additional impact on investment that cannot be quantified:

• qualitive assessment of benefits that can reasonably be quantified – this field is a compliment to the other information provided and not a replacement

If you have any specific questions on this requirement, please contact the UK Space Agency programme manager or named UK Space Agency contact.

6.6. Further detail on subsidy control relating to national grants 

The UK Space Agency supports organisations to invest in research, development and innovation. The support we provide is consistent with the UK’s international obligations and commitments to Subsidy Control. These include:

• WTO rules
• the EU-UK Trade and Cooperation Agreement (TCA), (see EU-UK TCA summary and DBT (Department for Business & Trade) guidance)
• in certain circumstances (eg, under the Northern Ireland Protocol) EU State aid regulations may also be applied
• other bilateral UK FTAs (Free Trade Agreements) where relevant
• Subsidy Control Act 2022

What is a subsidy?

For the purposes of UK international commitments, a subsidy is a measure which: 

• is given by a public authority. This can be at any level: central, devolved, regional or local government or a public body
• makes a contribution (this could be a financial or an in-kind contribution) to an enterprise, conferring an economic advantage that is not available on market terms. Examples of a contribution are grants, loans at below market rate, or a loan guarantee at below market rate or allowing a company to use publicly owned office space rent free. An enterprise is anyone who puts goods or services on a market. An enterprise could be a government department or a charity if they are acting commercially.
• affects international trade. This can be trade with any World Trade Organisation member or, more specifically, between the UK and a country with whom it has a Free Trade Agreement. For example, if the subsidy is going towards a good which is traded between the UK and the EU this could affect trade between the EU and the UK. It is not necessary to consider whether the subsidy could harm trade, just whether there could be some sort of effect. Subsidies to very local companies or a small tourist attraction are unlikely to be a problem as this is unlikely to affect international trade.

The Subsidy Control regime (or where relevant EU State aid regulations) is designed to prevent unfair advantages and distortion of trade. Read more about complying with the UK’s international obligations on subsidy control.

More information on the principles of awarding subsidies can be found in the DSIT guidance.

Commercial entities

The following table summarises the maximum intervention thresholds allowable level of support under UK Space Agency grant calls. The subsidy categories provided match the definitions used by the European Commission state aid regime paragraphs 83 to 98.

Subsidy category	Level of support available: Micro/SE	Level of support available: ME	Level of support available: LE
Fundamental research	100%	100%	100%
Feasibility study	70%	60%	50%
Industrial research	70%	60%	50%
Industrial research projects involving collaboration/dissemination	85%	75%	65%
Experimental development	45%	35%	25%
Experimental development projects involving collaboration/dissemination	60%	50%	40%

For the purposes of subsidy control, the following definitions are applicable:

• a small enterprise has an annual turnover below £10.2 million, a balance sheet total below £5.1 million and the average number of employees must not be more than 50
• a medium enterprise has an annual turnover below £36 million, a balance sheet total below £18 million and the average number of employees must be no more than 250
• a large enterprise has an annual turnover above £36 million, a balance sheet total above £18 million and the average number of employees is above 250

To qualify for any category, the company must meet at least two of the above conditions (staff headcount, turnover or balance sheet total) within both the current financial year and the year previous.  

Anything above the limits for a medium sized company is designated as a large company. For more information on company sizes, please refer to the company accounts guidance. This is a change from the EU definition unless you are applying under state aid. 

Other sources of public funding are not eligible as a private venture (PV)/match funding contribution. 

Academic partners will be funded in all cases at 80% of Full Economic Cost (FEC). 

Previous project subsidies

In accordance with paragraph 10.36 of the subsidy control statutory guidance, cumulation rules apply for any award issued under this call. This limits the Agency’s ability to fund projects that have received previous project funding that exceeds the limits of the scheme. To accurately assess compliance with the financial thresholds laid down in the streamlined schemes, all applicants are to identify any previous project funding from any public body over the last 3 years. Any applicant that has received over £10 million in total (including that been sought under this call) that would deem the award a subsidy of particular interest, in accordance with the statutory guidance, will be ineligible for this call.

Before awarding subsidies, the UK Space Agency must ensure that the subsidy scheme meets the terms of the principles as determined in the Subsidy Control Act 2022.

The principles are that: 

• subsidies should pursue a specific public policy objective to remedy an identified market failure or to address an equity rationale such as local or regional disadvantage, social difficulties, or distributional concerns (“the objective”)
• subsidies should be proportionate to their specific policy objective and limited to what is necessary to achieve the objective
• subsidies should be designed to bring about a change of economic behaviour of the beneficiary that is conducive to achieving the objective and that would not be achieved in the absence of subsidies being provided
• subsidies should not normally compensate for the costs the beneficiary would have funded in the absence of any subsidy
• subsidies should be an appropriate policy instrument to achieve a public policy objective and that objective cannot be achieved through other less distortive means
• subsidies’ positive contributions to achieving the objective should outweigh any negative effects, in particular the negative effects on trade or investment between the parties
• subsidies should be designed to achieve their specific policy objective while minimising any negative effects on competition or investment within the United Kingdom

To ensure this competition provides funding in line with the UK’s obligations and commitments to Subsidy Control, the intervention rates shall apply unless: 

1. the bidder seeks to claim exemption from having to make a contribution under the minimal financial assistance allowance (previously known as de-minimis under state aid and small amounts of financial assistance under trade and co-operation agreement) rules
2. the bidder is a research or public sector organisation or charity

When referring to research organisations, the UK Space Agency uses the definition from the framework for state aid for research and development and innovation which states: 

‘research and knowledge dissemination organisation’ or ‘research organisation’ means an entity (such as universities or research institutes, technology transfer agencies, innovation intermediaries, research-oriented physical or virtual collaborative entities), irrespective of its legal status (organised under public or private law) or way of financing, whose primary goal is to independently conduct fundamental research, industrial research or experimental development or to widely disseminate the results of such activities by way of teaching, publication or knowledge transfer. Where such entity also pursues economic activities, the financing, the costs, and the revenues of those economic activities must be accounted for separately. Undertakings that can exert a decisive influence upon such an entity, for example in the quality of shareholders or members, may not enjoy a preferential access to the results generated by it.

Within the UK Space Agency, this means:  

• universities - higher education institutions
• non-profit research and technology organisations (RTOs), including “catapults”
• public sector organisations (PSOs)
• public sector research establishments (PSREs)
• research council institutes
• research organisations (ROs)
• charities

This list is not comprehensive and is subject to change and exceptions

Research organisations undertaking non-economic activity will be funded as follows:  

• universities: 80% of full economic costs
• all other research organisations: 100% of eligible costs

Research organisations should be non-profit distributing to qualify. They should explain how they will disseminate the output of their project research as outlined in the application.  

Research organisations which are engaged in economic activity as part of the project will be treated as business enterprises for the purposes of funding. 

Public sector organisation or charity  

Public sector organisations and charities can work with businesses to achieve innovation through knowledge, skills, and resources. These organisations must not take part in any economic activity or gain economic benefit from a project. They can apply for 100% of funding for their eligible costs under the following conditions:  

• they are undertaking research (this may be experimental, theoretical, or critical investigation work to gain knowledge, skills or understanding vital to the project)
• they meet requirements for dissemination of their project results, and they state in the application how they will do this
• they include their eligible costs for research purposes in the total research organisation involvement
• they make sure they are not applying for funding towards costs which are already being paid by the public purse such as labour and overheads

Third sector  

Third sector organisations are primarily voluntary and community, such as associations, self-help groups, mutuals and cooperatives. Third sector organisations can be non-funding partners in a project.  

Bidders must identify the work proposed, and this must be consistent with the work programme described in the technical case. Note that the company size defines the maximum ‘intervention’ rate (and hence the minimum required PV level) that is permitted. Bidders will be expected to justify the category of work selected. 

Bidders must ensure that they supply the correct information that allows UK Space Agency to award grants within the scheme. It is the responsibility of the grant funder to ensure compliance with the relevant subsidy control rules and the bidder to assist the funder in doing this by acting within the terms and conditions of the scheme.

Further guidance about subsidy control is available on the gov.uk website.