Farmhouses and Restaurants) Regulations, 2010 (rziezeturistoranti)

L.N. 531 of 2010

MALTA ENTERPRISE ACT

(CAP. 463)

Loan Interest Rate Subsidy (Guest Houses, Hostels, Hotels,

Farmhouses and Restaurants) Regulations, 2010

IN exercise of the powers conferred upon him by article 5 of the

Malta Enterprise Act, the Minister of Finance, Investment and the

Economy has made the following regulations:-

(1) The title of these regulations is Loan Interest Rate

Subsidy (Guest Houses, Hostels, Hotels, Farmhouses and

Restaurants) Regulations, 2010.

(2) These regulations shall be deemed to have come into force

on the 1st October, 2010.

In these regulations, unless the context otherwise requires

"the Act" means the Malta Enterprise Act;

"bank" means a bank in terms of the Banking Act;

"the Corporation” means the Malta Enterprise established under

the Act;

"eligible costs" means expenditure of a capital nature, incurred

as part of an eligible investment project;

"eligible investment project" means a project for the

refurbishment or upgrading of a guest house, hostel, hotel, farmhouse

or restaurant, or for the acquisition of new machinery, apparatus or

instrument to be used in the operation of a guest house, hostel, hotel,

farmhouse or restaurant, such project being approved by the

Corporation under these regulations and as may be prescribed in the

Guidelines, in respect of which project eligible costs have been

incurred and which new machinery, apparatus or instrument are

retained within the business for at least five years or such other

shorter period as the Corporation may deem appropriate in view of

the nature of the project

Provided that an investment project shall not be treated as an

eligible investment project if it is linked to

(a)

purchase of land or property;

(b)

wages;

(c)

operating expenses;

"farmhouse" means a holiday premises which is

constructed and finished to represent a typical Maltese farmhouse,

located in an area compatible with a farmhouse environment;

"financial institution" means financial institution as defined in

the Financial Institutions Act;

"Guidelines" means such guidelines as may be published by the

Corporation from time to time in terms of the Act;

"guest house" means a guest house as defined and licensed to

operate as such in terms of the Malta Travel and Tourism Services Cap. 409.

Act;

"hostel" means a hostel as defined and licensed to operate as

such in terms of the Malta Travel and Tourism Services Act;

"hotel" means a hotel as defined and licensed to operate as such

in terms of the Malta Travel and Tourism Services Act;

"large undertaking", "medium-sized undertaking", "small

undertaking" shall have the meaning attributed to them by Annex I of

Commission Regulation (EC) No 800/2008 of 6 August 2008

declaring certain categories of aid compatible with the common

market in application of Articles 87 and 88 of the Treaty (General

Block Exemption Regulation);

"restaurant" means a catering establishment as defined under

the Catering Establishments Regulations, and licensed to operate as S.L. 409.15

such in terms of the Malta Travel and Tourism Services Act;

"undertaking" means an undertaking as defined in the Act.

(1) Where the Corporation is satisfied that an Loan interest

undertaking which carries out, in Malta, a trade or business consisting subsidy.

mainly of the operation or management of a guest house, hostel,

hotel, farmhouse or restaurant, intends to carry out an eligible

investment project, as shall have been approved by the Corporation,

the Corporation may subsidise the rate of interest payable by the

undertaking on loans which the said undertaking may take out in

order to finance eligible costs to be incurred as part of such an eligible

investment project

Provided that this benefit shall be calculated on the eligible

costs incurred as from 1st June 2010 till the 31st December 2013.

(2) The subsidy referred to in subregulation (1) shall be such

as to ensure that the rate of interest effectively borne by the

undertaking shall not exceed the rate of interest that shall be arrived at

by deducting between one and three percentage points from the rate

of interest charged by the bank or the financial institution.

(3) The loan interest rate subsidy that may be granted in terms

of this regulation shall be applicable only to interest payable during

the first five years of a loan period on a loan amount that shall not

exceed the sum of seven million euro (€7,000,000) in the case of an

undertaking operating as a guest house, hostel, hotel or a farmhouse

and on a loan amount that shall not exceed the sum of five hundred

thousand euro (€500,000) in the case of an undertaking operating as a

restaurant.

(4) Loans which qualify for the interest rate subsidy

contemplated by this regulation shall be loans provided by banks and

other financial institutions.

The assistance granted in terms of regulation 3 shall not

exceed fifty per cent (50%) of eligible costs in the case of small

undertakings, forty per cent (40%) of the eligible costs in the case of

medium-sized undertakings and thirty per cent (30%) of eligible costs

in the case of large undertakings.

Applications for assistance under these regulations shall

reach the Corporation by not later than the 31st December, 2013.

€0.28