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The "Innovation Alliances" in Germany (a national example for EU research and innovation policy) 1. The Concept "Innovation Alliances" were introduced as a new instrument for research and innovation policy within the framework of the "High-Tech Strategy". They are strategic cooperation between science and business with a focus on specific application areas or future markets. Their objective is to achieve a 5-fold economic leverage of public funding by committing industry to a long-term investment of 5 Euros in R&I for 1 Euro of research funding from the Federal Government. 2. How this works in practice They are based upon a prior dialogue between the public and the private side and the identification of common aims and interests. There are no formal selection criteria, but a high level of synergy, contribution to policy objectives, critical mass and, in particular, industry initiative is required (which is reflected in a "position paper" by the leading companies). The public funding part is implemented by normal pre-competitive research projects following the usual rules for public research funding. The private share consists largely of "post-R&D-investments" which go beyond the research project, such as pilot plants or precommercial activities. For these investments, no further public research co-funding is provided. There is no formal legal agreement between the public and the private side. However, a binding effect is given by a prior, high-level commitment of the business community taken at board level of the leading companies and announced in their annual reports. Besides the public announcement, these commitments also are binding because they define internally their future R&D priorities and strategies. The commitments foresee that investments are to be made in Germany. For the SMEs in the supply network, the strategic commitment of leading enterprises reduces the risk of R&D investment decisions and facilitates further R&I-investments. A detailed accounting of the compliance with the commitment is not published because of restrictions concerning company investment data. However, accounting is ensured by regular reporting to the related ministry departments. 3. Progress achieved 9 innovation alliances have been created in 2007 and 2008 with a public contribution of EUR 600 million and more than EUR 3 billion from business, addressing areas such as Organic LEDs, Organic PV, Lithium-Ion-Batteries and Molecular Imaging. Participating companies are for example BASF, BOSCH, EVONIK, Volkswagen, Siemens AG, Carl Zeiss AG, Bayer Schering. So far, the BMBF considers the Innovation Alliances as a proven instrument for Innovation policy.