The 5 Frascati Criteria: The Key to the Research Premium

In a Nutshell

• The five Frascati criteria determine whether a project qualifies as research and development
• Novelty, creative activity, uncertainty, systematic approach, and reproducibility must all be met
• The distinction between experimental development and sophisticated engineering is often decisive in practice
• Careful documentation of the criteria strengthens the research premium application

The Austrian research premium is a powerful instrument, but it requires precise delineation. Not everything that is technologically sophisticated counts as research and experimental development (R&D). The basis for assessment is formed by the five Frascati criteria.

1. Novelty: Going Beyond the Known

The project must aim to expand the state of knowledge in an industry. It's about objective novelty - a solution that is not obvious to experts in the field.

• Positive example: A company develops a novel, biodegradable composite material for aviation that withstands extreme pressure conditions for which no material specifications previously existed.
• Negative example: The purchase and installation of a modern standard production machine that is "new" to the company but corresponds to the current state of the art on the market. Subjective novelty is not sufficient.

2. Creative Activity: Originality Over Routine

New concepts, theoretical models, or technical solutions must emerge. Pure routine improvements or standard adjustments are excluded.

• Positive example: Creating an entirely new software architecture for real-time processing of sensor data in autonomous vehicles to significantly reduce latency below what was previously possible.
• Negative example: Simple bug fixing in an existing software system or adding standard features that can be implemented with known tools.

3. Uncertainty: The Calculated Risk

Both the outcome and the effort must be uncertain at the outset. If it is certain that the project can be successfully completed using known methods, the R&D component is missing.

• Positive example: A chemical process is to be transferred from lab-scale formulation to a pilot plant through up-scaling. It is uncertain whether chemical stability will be maintained at large scale.
• Negative example: Planning a standard high-rise building using proven structural methods. Even though the project is complex, the technological outcome is certain.

4. Systematic Activity: A Plan with Method

R&D is a planned process. Everything must be documented - from the hypothesis through the test series to the result.

• Positive example: A structured project plan with defined milestones, in which every test series for optimising an energy recovery system is documented in detail.
• Negative example: An accidental invention that arose through a mishap in the laboratory, without any prior systematic research question or plan.

5. Transferable and Reproducible: Securing Knowledge

The results must be comprehensible to other specialists. The knowledge gained must be documented and made usable within the company.

• Positive example: An internal wiki or technical reports that describe the failed and successful test series of a new engine control system so that other engineers can build upon them.
• Negative example: A project whose success depends exclusively on the secret specialist knowledge of a single employee, without any documentation of the methodology.

Experimental Development vs. Sophisticated Engineering

In practice, the line between experimental development and industrial engineering is often blurry - and this distinction frequently determines whether a research premium application succeeds.

Sophisticated engineering encompasses all technical work necessary to start a production process or to bring a system to smooth operation. When the product is essentially defined and the goal is merely market readiness or manufacturing optimisation, it is engineering - even if the calculations are highly complex.

Experimental development begins where engineering reaches its limits. As soon as new scientific-technological insights must be gained to solve a problem, or feedback loops back into research are needed because the system doesn't work as expected, we are in the realm of R&D.

• Engineering example: Adapting an existing conveyor system to the spatial conditions of a new customer (technically difficult but methodologically known).
• Development example: Developing an entirely new gripper technology for this system, because conventional tools would destroy the specific surface properties of the new transport goods and the suitable material and pressure must first be determined experimentally.

Important note: These distinctions are critical for the FFG expert opinion. The uncertainty and novelty aspects should be documented with particular care.

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The research premium is one of Austria's most attractive funding instruments. StartMatch supports companies throughout the entire application process: from identifying eligible projects to creating compliant application texts and calculating the assessment base.

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