The Rules for Participation allow any third country to participate in the Framework Programme. There is no need for a formal Science and Technology Co-operation Agreement – unless participation is limited in the annual workprogramme – and thus NZ participates under exactly the same conditions as Australia, the USA and Canada (amongst others).
In principle, there is nothing to prevent NZ participation in most of the FP7 activities. There are notable exclusions though: it’s hard to see a case for the involvement of a NZ organization in the Ideas programme through the European Research Council. That said, the issue of participation is less about a right to participate than the opportunity to be part of a contract or consortium.
In FP7, you are either a signatory to the grant agreement (contract), or not. There are no associate roles, as in FP5. In signing the formal contract with the EC and the rest of your consortium, you agree to abide by the terms and conditions of the EC contract, and share equal rights and responsibilities with your partners with respect to delivering the project.
The only other possibility for involvement is as a sub-contractor. In this role, you will provide a service (according to the EC grant agreement, this cannot be a fundamental part of the project) on behalf of one of the partners. Since the intellectual property /knowledge generated in providing this service is legally wholly owned by the partner (and in turn the consortium), you may charge a market rate for this service provision.
In short, this means the following:
Partner
Sub-contractor
The decision to participate as a sub-contractor is one that must be considered on a case by case basis. The short-term desire for funding should be weighed against the long-term opportunities to exploit intellectual property. Just be sure that the decision is yours: sometimes co-ordinators will try to push organizations into one role that doesn’t fit with the aims of the organisation.