Grants can be awarded as donations to third parties that are engaged in external aid activities.
The Financial Regulation and its Implementing Rules establish the principle of transparency for grants. Annual programmes for grants are published at annually at the beginning of the year (except for crisis management and humanitarian aid operations).
Grants are based on the reimbursement of the eligible costs, in other words, costs effectively incurred by the beneficiaries that are deemed necessary for carrying out the activities in question. The results of the action remain the property of the beneficiaries. Grants are subject to a written agreement signed by the two parties and, as a general rule, require co-financing by the grant beneficiary. Since grants cover a very diverse range of fields, the specific conditions that need to be fulfilled (eligibility, etc.) may vary from one area of activity to another.
Procurement procedures are launched to purchase a service, goods or work in exchange for remuneration. Procurement procedures are governed by specific rules which vary depending on the nature of the contract (service, supplies, work) and the threshold.
In the case of a contract, the Contracting Authority receives the product or service it needs in return for payment
In the case of a grant, it makes a contribution either to a project carried out by an external organisation or directly to that organisation because its activities contribute to Community policy aims.