Authority to perform income-generating activities (IV) has been obtained in the Finance Act. IV is budgeted separately, i.e. in a separate sub-account in the Finance Act in accordance with section 2.6.8.1 of the Ministry of Finance's Budget Guidelines.
As a publicly financed institution, AU is subject to a requirement that it must not engage in unfair price competition. Pricing must be such that it does not distort competition with regards to private-sector or public-sector competitors and such that all direct and indirect costs are recovered.
If a project is primarily not research, but is a natural offshoot of AU activities of commercial interest, it will be considered IV.
When is a project an IV project?
The following conditions must be met for a project to be an IV project:
- Clients must not be obligated to take delivery of the goods or services in question.
- The institution must be able to separate the production of goods or services called for by income-generating activities from the institution’s other tasks.
- The areas of income-generating activities must derive naturally from the institution’s general activities (i.e. they must fall within natural areas of expertise at the institution).
- The price of individual goods or services must be such that it does not constitute distortion of competition with private or public-sector competitors, and such that long-term average costs are covered. The established overhead rate and price calculation form must be used.
Commercial activity?
Commercial or non-commercial activity?
If you are to start a new externally financed project at AU, here is information about what you need to be aware of in the application phase and when drawing up contracts. This quick guide about commercial and non-commercial activities is intended to help you and your department (Aarhus BSS, NAT, TECH, HE)/school (Arts) avoid costly financial surprises during the project, and to help ensure that AU complies with the external rules for the area.
Quick guide: commercial or non-commercial activity
Why define the project?
It is important to establish whether your project is a commercial or a non-commercial activity, as this has an influence on the rules applying in relation to:
- rights to research data
- compensation claims
- calculation of overheads
- co-financing options
- VAT liability
How is the project defined?
The project is defined as either a commercial or a non-commercial activity, based on information in the application and the contract on the nature of the project and on project-related rights and finances. The mini-guide contains more information about the specific parameters for the distinction, and there are also examples of commercial and non-commercial activity.
