European innovation policy is strongly rooted in the industrial policy of the European Union (EU) as well as policy on Information and Communication Technology (ICT). Already at the beginning of the 1980s, Europe experienced a growing gap in innovation vis-à-vis the United States of America and Japan, which led to the creation of the European network for market oriented industrial research (EUREKA) as an intergovernmental initiative in 1985 with a strong focus on ICT research. The two main founders of EUREKA were the former Heads of State François Mitterrand (FRANCE) and Helmut Kohl (GERMANY). The European Community (the predecessor of the EU) and eighteen additional countries, including Switzerland, were the founding members.
An important further step was the report 'Europe and the Global Information Society' (also called the Bangemann report) from 1994, which called for an increased role of the EU in ICT and marks this as an integral component in sustaining the Single Market. The report advocated for a liberalisation of telecommunications for precedence to be given to the private sector in advancing innovation in the ICT sector. In addition, the report proposed an action plan for establishing a partnership between the private and public sectors to carry Europe forward towards becoming an information society. .
The Lisbon Strategy marked another important step in European innovation policy, as innovation was given a new role as the motor for economic change and growth. The Strategy intended to deal with the low productivity and stagnation of economic growth in the EU through the formulation of various policy initiatives to be taken by all member states. A translation of the Lisbon Strategy into concrete measures led to the extension of the Framework Programmes for Research and Technological Development into FP7, and the creation of European Technology Platforms (ETP) and Joint Technology Initiatives (JTI). These were to serve as an impetus to achieving the target of spending at least 3% of the Gross Domestic Product (GDP) for research and technological development.
In 2006, the EC published its communication 'Putting knowledge into practice: A broad innovation strategy for the EU'. The launch of this strategy under the Finnish Presidency of the Council of the EU in 2006 put greater emphasis on demand-driven innovation, whereas the previous EC communication 'More Research and Innovation' (2005) addressed supply-driven innovation in a more traditional way.
As a follow-up to the Europe 2020 strategy, the EC published the communication 'Europe 2020 Flagship Initiative Innovation Union' on 6 October 2010. The communication set out 34 action points, which would form the EU innovation policy agenda for the next decade and hence also the policy framework for the European Framework Programme for Research and Innovation from 2014 to 2020 (Horizon 2020). The communication saw innovation as a crosscutting policy with a high priority. In the current EC, no fewer than sixteen portfolios touch directly or indirectly upon innovation. Topics range from research, ICT, energy, health, environment, education, employment, Small and Medium Enterprise (SME) policy, competitiveness and internal market. A major change pertained to the main responsibility for innovation policy, which moved from the Directorate-General for Enterprise and Industry (DG ENTR) to the Directorate-General for Research and Innovation (DG RTD). However, DG ENTR remained responsible for 'industrial innovation policy' as well as for 'SME policy'. This policy area included the Enterprise Europe Network (EEN), the only part of the Competitiveness and Innovation Programme (CIP) in which Switzerland participated from 2007 to 2013.
Horizon 2020: 'from research to retail'
Innovation is embedded throughout two out of the three parts of Horizon 2020: 'Industrial Leadership' and 'Tackling Societal Challenges'. Intelligent Energy Europe (IEE) is part of the energy theme in the Specific Programme 'Tackling Societal Challenges' of Horizon 2020. The ICT Policy Support Programme (ICT-PSP) is carried out under the ICT theme in the 'Leadership in enabling and industrial technologies' part of Horizon 2020. The eco-innovation market replication projects (between 2007 to 2013 part of CIP) are found under the 'Climate action, resource efficiency and raw materials' challenge of Horizon 2020. The European Institute of Innovation and Technology (EIT), created in 2008, is also included as part of Horizon 2020. Furthermore, demonstration and market replication programme has been carried out in a new dedicated SME instrument, implemented under Horizon 2020. The SME instrument has strong links to EEN.
EEN however is funded under the European Programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME). The €1.4 billion of the COSME budget are allocated for financial instruments for both equity and debt. Financial instruments will be the most important activity of the programme (59% of the total budget). There is no overlap but complementarity with the financial instruments of Horizon 2020. Financial instruments of Horizon 2020 are exclusively used for financing research and innovation projects, whereas financial instruments in COSME cover a broader range of entrepreneurial activities. Switzerland is not associated to COSME, but has stayed part of EEN.