Access to Finance Regulations, 2021

L.N. 71 of 2021

MALTA ENTERPRISE ACT

(CAP. 463)

Access to Finance Regulations, 2021

IN EXERCISE of the powers conferred by article 5 of the Malta

Enterprise Act, the Minister for Energy, Enterprises and Sustainable

Development, after consultation with the Malta Enterprise Corporation

and with the concurrence of the Minister for Finance and Employment,

has made the following regulations:-

(1) The title of these regulations is the Access to Finance

Regulations, 2021.

(2)

These regulations shall be deemed to have come into force

on 1 st December 2020

In these regulations, unless the context otherwise requires

"Act" means the Malta Enterprise Act;

"Corporation" means Malta Enterprise established under

the Act;

"eligible investment project" means an initial investment

project in a qualifying economic activity as defined in the

Guidelines;

"guidelines" means such guidelines as may be published by

the Corporation from time to time in terms of the Act;

"relocation" means a transfer of the same or similar activity

or part thereof from an establishment in one contracting party to

the EEA Agreement (initial establishment) to the establishment

in which the aided investment takes place in another contracting

party to the EEA Agreement (aided establishment). There is a

transfer if the product or service in the initial and in the aided

establishments, serves at least partly the same purposes and

meets the demands or needs of the same type of customers, and

jobs are lost in the same or similar activity in one of the initial

establishments of the beneficiary in the EEA;

"small and medium sized enterprise (SME)" or "(SMEs)"

shall have the same meaning as assigned to it by Annex 1 of

Commission Regulation (EU) No 651/2014 of 17 June 2014;

"start of works" means the earlier of either the start of

construction works relating to the investment, or the first legally

binding commitment to order equipment or any other

commitment that makes the investment irreversible. Buying land

and preparatory works such as obtaining permits and conducting

feasibility studies are not considered "start of works". For take-

overs, "start of works" means the moment of acquiring the assets

directly linked to the acquired establishment;

"the same or a similar activity" means an activity falling

under the same class (four-digit numerical code) of the NACE

Rev. 2 statistical classification of economic activities as laid

down in Regulation (EC) No 1893/2006 of the European

Parliament and of the Council of 20 December 2006 establishing

the statistical classification of economic activities NACE

Revision 2 and amending Council Regulation (EEC) No 3037/90

as well as certain EC Regulations on specific statistical domains;

"undertaking" shall have the same meaning as assigned to it

in the Act.

(1) Where the Corporation is satisfied that an SME is Qualifying

carrying out an eligible investment project in Malta in accordance with enterprises.

the terms and conditions set out in the Guidelines, the Corporation

may support the eligible undertaking with a guarantee to be used

against a bank loan.

(2) Applications must be submitted prior to the commencement

of the investment project giving the Corporation reasonable time to

evaluate prior to the intended start of works.

(3) The beneficiary shall provide a financial contribution of at

least twenty-five per cent (25%) of the eligible costs either through its

own resources or by external financing in a form which is free of any

public support.

(4) The undertaking must not have carried out a relocation to

the establishment in which he initial investment for which aid is

requested is to take place in the two (2) years preceding the application

for aid and it must commit that it will not carry out a relocation up to a

period of two (2) years after completion of the supported initial

investment.

(5) The investment made shall be retained in Malta for a

minimum period of at three (3) years after completion of works. This

shall not prevent the replacement of plant or equipment that has

become outdated or broken within this period, provided that the

economic activity is retained in the area concerned for the relevant

minimum period.

(1) Eligible undertakings may be supported through a

guarantee to be used against a bank loan required for

(a)

the setting up of a new establishment; or

(b) the extension of the capacity of an existing

establishment.

(2) The support may be used to finance construction works,

furbishing and finishing of buildings and industrial structures, and

acquisition of plant, machinery and equipment as prescribed in the

guidelines.

(3) The value of the guarantee shall not exceed ten million euro

(€10,000,000).

Support shall be limited to a value of aid that does not

exceed twenty per cent (20%) of eligible costs if the applicant is a

medium-sized enterprise or thirty per cent (30%) of eligible costs if the

applicant is a small enterprise.

(1) Applications for assistance under these regulations

shall reach the Corporation before 31 st October 2021.

(2) No assistance under these regulations shall be awarded by

the Corporation after 31 st December 2021.

€0.27