INTEREST RATE SUBSIDY, REGULATIONS

INTEREST RATE SUBSIDY

SUBSIDIARY LEGISLATION 463.31

INTEREST RATE SUBSIDY, REGULATIONS

1 st September 2019

LEGAL NOTICE 285 of 2019.

The title of these regulations is the Interest Rate Subsidy,

Regulations.

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 as defined in

the Guidelines;

"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;

"large undertaking", "medium-sized undertaking", and

"small undertaking" shall have the meaning attributed to them

in the Guidelines;

"tangible assets" means fixed physical assets in relation

to the creation of an undertaking, or extension of an existing

undertaking, or engagement in activity involving fundamental

product or production process change; and

"undertaking" means an undertaking as defined in the

Act.

(1)

Where the Corporation is satisfied that an

undertaking which carries out in Malta, an eligible investment project,

as shall have been approved by the Corporation in accordance with the

terms and conditions set out in the Guidelines, 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 the

procurement of qualifying tangible assets.

(2)

The subsidy shall not exceed an interest rate equivalent

to three percent (3%) per annum. In any case 1% of the interest rate

INTEREST RATE SUBSIDY

charged by the bank must be paid by the beneficiary. Irrespective of

the term of the loan the subsidy shall only be available up to the tenth

(10th) year from the date of the initial drawdown.

(3)

Loans which qualify for the interest rate subsidy

contemplated by this regulation shall be loans provided by banks

licenced to operate in Malta.

(1) Undertakings supported through this measure

shall be SMEs as well as large undertakings. To be eligible for aid

through this incentive, an undertaking must operate from Malta and be

incorporated in the European Union as a partnership en nom collectif,

en commandite or a limited liability company, co-operative, family

business or similar set-up.

(2)

The loan covered by the subsidy shall be used to procure

tangible assets.

The assistance granted in terms of regulation 3 shall be

calculated at the Net Present Value at time the aid is awarded and the

total assistance shall not exceed the percentage as established below -

(a)

thirty per cent (30%) of eligible costs in the case

of small undertakings;

(b)

twenty per cent (20%) of the eligible costs in the

case of medium-sized undertakings; and

(c)

ten per cent (10%) 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 2022.