S.L. 463.5 Art. 2Interpretation.

In these regulations, unless the context otherwise requires:

"the Act" means the Malta Enterprise Act;

"aid intensity" means the gross aid amount expressed as a percentage of the eligible costs, before any deduction of tax or other charge; "the Corporation" means the Malta Enterprise Corporation established under the Act; "eligible costs" means expenses incurred by an undertaking:

(a) to carry out industrial research or experimental development: Provided that the eligible costs considered by this paragraph shall only be applicable to undertakings which qualify for assistance under these regulations until the 30th June, 2014;

(b) to carry out technical feasibility studies preparatory to industrial research or experimental development: Provided that the eligible costs considered by this paragraph shall only be applicable to undertakings which qualify for assistance under these regulations until the 30th June 2014;

(c) to carry out feasibility studies in preparation for an industrial research or an experimental development project having the start of works happening on or after the 1st November, 2014;

(d) to obtain and validate patents and other industrial property rights;

(e) to carry out industrial research and experimental development projects as well as to carry out feasibility studies in preparation for industrial research or experimental development projects, having the start of works happening on or after the 1st November 2014, in accordance with the terms and conditions set out in the

*see regulation 1(2) of these Regulations, as originally promulgated. Guidelines;

"effective collaboration” means collaboration between at least two independent parties to exchange knowledge or technology, or to achieve a common objective based on the division of labour where the parties jointly define the scope of the collaborative project, contribute to its implementation and share its risks, as well as its results. One or several parties may bear the full costs of the project and thus relieve other parties of its financial risks. Contract research and provision of research services are not considered forms of collaborations: Provided that this definition shall be applicable to industrial research and experimental development projects having the start of works happening on or after the 1st November, 2014; "experimental development" means the acquiring, combining, shaping and using of existing scientific, technological, business and other relevant knowledge and skills for the purpose of producing plans and arrangements or designs for new, altered or improved products, processes or services but shall not include the routine or periodic changes made to products, production lines, manufacturing processes, existing services and other operations in progress, even if such changes may represent improvements. The experimental production and testing of products, processes and services are also eligible, provided that these cannot be used or transformed to be used in industrial applications or commercially: Provided that the following definition for "experimental development" shall be applicable to research and development projects having the start of works happening on or after the 1st November, 2014: "experimental development" means acquiring, combining, shaping and using existing scientific, technological, business and other relevant knowledge and skills with the aim of developing new or improved products, processes or services. This may also include, for example, activities aiming at the conceptual definition, planning and documentation of new products, processes or services:

Provided that experimental development may comprise prototyping, demonstrating, piloting, testing and validation of new or improved products, processes or services in environments representative of real life operating conditions where the primary objective is to make further technical improvements on products, processes or services that are not substantially set. This may include the development of a commercially usable prototype or pilot which is necessarily the final commercial product and which is too expensive to produce for it to be used only for demonstration and validation purposes: Provided further that experimental development does not include routine or periodic changes made to existing products, production lines, manufacturing processes, services and other operations in progress, even if those changes may represent improvements; "feasibility study" means the evaluation and analysis of the potential of a project, which aims at supporting the process of decision-making by objectively and rationally uncovering its strengths and weaknesses, opportunities and threats, as well as identifying the resources required to carry it through and ultimately its prospects for success: Provided that "feasibility studies" in the above definition refers to feasibility studies in preparation for industrial research and experimental projects as contemplated by these regulations: Provided also that the above definition for "feasibility study" in preparation for industrial research and experimental development projects shall be applicable to feasibility studies in preparation for industrial research and experimental projects having the start of works happening on or after the 1st November 2014, in accordance with the terms and conditions set out in the Guidelines: Provided further that the applicable definition for technical feasibility studies preparatory to industrial research and experimental development for research, development and innovation projects approved by the Corporation till the 30th June 2014, is provided in the Guidelines applicable at the time; "the Guidelines" means such guidelines as may be published by the Corporation from time to time in terms of the Act; "industrial research" means the planned research or critical investigation aimed at the acquisition of new knowledge and skills for developing new products, processes or services or for bringing about a significant improvement in existing products, processes and services: Provided that industrial research comprises the creation of components parts of complex systems, and may include the construction of prototypes in a laboratory environment or in an environment with simulated interfaces to existing systems as well as of pilot lines, when necessary for the industrial research and notably for generic technology validation; "large undertaking", "medium-sized undertaking", "small undertaking" and "micro undertaking" shall have the meaning attributed to them by Annex I of Commission Regulation (EC) No 800/2008 of the 6th August, 2008 declaring certain categories of aid compatible with the common market in application of Articles 87 and 88 of the Treaty (General Block Exemption Regulation):

Provided that for industrial research and experimental development projects as well as for feasibility studies in preparation for industrial research or experimental development projects having the start of works happening on or after the 1st November 2014, " "large undertaking", "medium-sized undertaking", "small undertaking" and "micro undertaking" " shall have the meaning attributed to them by Annex I of Commission Regulation (EU) No 651/2014 of 17 June 2014 declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty; "research organisation" means an entity, such as university or research institute, irrespective of its legal status (organised under public or private law) or way of financing, whose primary goal is to conduct fundamental research, industrial research or experimental development and to disseminate their results by way of teaching, publication or technology transfer; all profits are reinvested in these activities, the dissemination of their results or teaching; undertakings that can exert influence upon such an entity, in the quality of, for example, shareholders or members, shall enjoy no preferential access to the research capacities of such an entity or to the research results generated by it;

"research and knowledge-dissemination 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 industrial research or experimental development or to widely disseminate the results of such activities by way of teaching, publication or knowledge transfer: Provided that where such entity also pursues economic activities the financing, the costs and the revenues of those economic activities must be accounted for separately: Provided further that undertakings that can exert a decisive influence upon such an entity, in the quality for example, shareholders or members may not enjoy preferential access to the results generated by it: Provided finally, that the above definition for "research and knowledge-dissemination organisation" shall be applicable to industrial research and experimental development projects having the start of works happening on or after the 1st November 2014 in accordance with the terms and conditions set out in the Guidelines; "start of works" means the earlier of either the start of construction works relating to the investment, or the first legally binding commitment to order equipment or any other commitment that makes the investment irreversible:

Provided that buying land and preparatory works such as obtaining permits and conducting feasibility studies are not considered start of works: Provided further that for take-overs, "start of works" means that moment of acquiring the assets directly linked to the acquired establishment; "undertaking" means an undertaking as defined in the Act except for the purposes of tax credits granted under regulation 3 where undertaking shall mean:

(a) a partnership constituted under the Companies Act, being a partnership or en nom collectif, en commandite a limited liability company; or

(b) a body of persons constituted, incorporated or registered outside Malta, and of a nature similar to the aforesaid partnerships and registered as an oversea company in accordance with the Companies Act; or

(c) a co-operative society duly registered as such under the Co-operative Societies Act: Provided that for industrial research and experimental development projects having the start of works happening on or after the 1st November 2014, "undertaking" shall have the same meaning as assigned to it in paragraphs (a) to (c) under the definition "undertaking" above: Provided also that, for feasibility studies in preparation for industrial research and experimental development projects having the start of works happening on or after the 1st November 2014, "undertaking" shall have the same meaning as defined in the Act.