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1. PRIMA-IS shall be considered to be a funding body as defined in Article 2, point (11), of Regulation (EU) No 1290/2013 and in Article 2, point (14), of Regulation (EU) 2021/695, as applicable, and shall provide financial support to indirect actions referred to in Article 6(1), point (a), of this Decision in accordance with the rules set out in the relevant Regulations and subject to the derogations set out in this Article.

2. In accordance with Article 17(2) of Regulation (EU) 2021/695 and by way of derogation from Article 9(1), point (b), of Regulation (EU) No 1290/2013, and from Article 22(2) of Regulation (EU) 2021/695, the minimum number of participants shall be three legal entities established in three different countries considered to be Participating States by the submission deadline under the relevant call for proposals, of which at least one is established:

(a) in a Member State or in a third country associated to Horizon 2020 or Horizon Europe, as applicable, which does not fall under point (b) of this Article;

(b) in a third country listed in Article 1(2), or in a third country bordering the Mediterranean Sea.

3. By way of derogation from Article 9(3) of Regulation (EU) No 1290/2013 and from Article 22(2) of Regulation (EU) 2021/695, in duly justified cases provided for in the annual work programme, the minimum condition shall be the participation of one legal entity established in a Participating State by the submission deadline under the relevant call for proposals.

4. By way of derogation from Article 10(1) and (2) of Regulation (EU) No 1290/2013 and from Article 23(1) and (2) of Regulation (EU) 2021/695, the following participants shall be eligible for funding by PRIMA-IS:

(a) any legal entity established in a Participating State or created pursuant to Union law;

(b) any international European interest organisation, as defined in Article 2(1), point (12), of Regulation (EU) No 1290/2013 for activities of PRIMA funded under Article 3(1), point (a), of this Decision or any international European research organisation, as defined in Article 2, point (15), of Regulation (EU) 2021/695 for activities of PRIMA funded under Article 3(1), point (b), of this Decision.

5. In the case of a participating international organisation or of a participating legal entity established in a country that is not a Participating State, neither of which is eligible for funding in accordance with paragraph 4, funding by PRIMA-IS may be granted provided that at least one of the following conditions is fulfilled:

(a) participation of the international organisation or legal entity concerned is deemed to be essential by PRIMA-IS for implementing the action;

(b) participation of such entities is foreseen in the annual work programme and the possibility of such funding is provided for under a bilateral scientific and technological agreement or under any other arrangement that ensures the protection of the financial interests of the Union, which is concluded between the Union and the international organisation or, for an entity established in a country that is not a Participating State, the country in which that legal entity is established.

6. Without prejudice to Regulation (EU, Euratom) 2018/1046, the applicable model grant agreement may lay down that legal entities established in countries which are not Participating States and which receive funding from PRIMA-IS shall also provide appropriate financial guarantees.

7. The Union shall conclude agreements with third countries that provide for the protection of the financial interests of the Union.