Universities across Europe breathed a sigh of relief this week as the European Commission clarified its position on funding the costs of research.
UK universities had feared that a full-cost model of calculating costs of research projects in Europe's £12 billion Framework Six programme could reduce by half the funding they were expecting to receive for collaborations with European institutions - forcing many of them to pull out.
But Megan Richards, head of the unit for regulatory and cross-cutting matters in the commission's research directorate general, has resolved the issue after negotiations with the Office for Science and Technology.
Ilse Vickers, director of European research for University College London and an adviser to Universities UK, said she was delighted that a resolution had been achieved before the commission's summer recess.
Over the past month, the commission and university grant administrators have fought over how research costs should be calculated for FP6 projects.
Dr Vickers and other research officers had become increasingly alarmed after a June seminar at UCL. The commission's Jean David Malo had told delegates - many of whom had made multimillion-pound proposals to FP6 - that they had to use a full-cost model.
At the heart of the dispute was what it meant for universities to identify the indirect costs of research. Mr Malo had implied that if universities could identify such costs - such as lighting, laboratory equipment and technicians - they had to use the full-cost model, even if they could not calculate the cost at project level.
But he has been overruled by Ms Richards, who has agreed that if universities cannot quantify indirect costs, they can use the additional cost model, which they have used before. This funds full direct costs with an extra 20 per cent for indirect costs.
Pierre Espinasse, deputy director of research services at Oxford University, welcomed the statement. But he said there were still issues about universities' status as public bodies, and who could audit them, that needed clarification.