ACCESS TO FINANCE REGULATIONS

ACCESS TO FINANCE

SUBSIDIARY LEGISLATION 463.39

ACCESS TO FINANCE REGULATIONS

1 st December 2020

LEGAL NOTICE 71 of 2021.

The title of these regulations is the Access to Finance

Regulations.

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

ACCESS TO FINANCE

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

carrying out an eligible investment project in Malta in accordance with

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

ACCESS TO FINANCE

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.