Accessible public aid for enterprises-tailored solutions + where to find them


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Learning Outcomes

Objectives and goalsClick to read  

At the end of this module you will be able to:

Get a knowledge what the public aid is 
Know types and form of the public aid
Learn the rules to get the public assistance
Find out where to get the aid you just need

Public aid fundamentals

What’s the public aid?Click to read  

The State aid is one given to an entrepreneur by the state or from state funds, on terms more favourable than those offered on the market. Since the state aid can distort the rules of competition, it is allowed only in specific cases and under specific rules.

We are talking about public assistance, when all of 4 prerequisites occur:

→ 1. Support is granted by the State or comes from State funds
→ 2. It is granted on terms more favourable than those offered in the market
→ 3. It is selective in nature (it favours a certain company or companies or the production of certain goods)
→ 4. Threatens to disrupt or distorts competition and affects trade between the EU Member States

Types and forms of the public aidClick to read  

Types of the public aid:

1. Horizontal - It is directed to all entrepreneurs, regardless of their place of business and sector of the economy, in order to solve a specific problem applies to aid in such areas as research, development, innovation, environmental protection and employment. 
Note: Horizontal nature is also de minimis aid, which can be granted without sectoral or regional restrictions. It is not "strictly" state aid. 

2. Regional - Aid intended to support the development of the least developed regions by promoting investment and job creation, in exceptional cases by granting operating aid.

3. Sectoral – the State aid granted exclusively to entrepreneurs in a specific economic sector (e.g., transport), as well as in sensitive sectors: coal industry, iron and steel industry, shipbuilding industry. To state aid granted in these sectors, due to their specific nature and the problems that occur (concerning, for example, overcapacity, capital-intensive nature of investments), different, more restrictive rules of state aid than the general rules often apply.

Public aids forms

 

The Public aid termsClick to read  

Aid programs contain the legal basis for granting specific support to entrepreneurs and, at the same time, define the principles and conditions for granting support, among other things:
• the circle of beneficiaries,
• the form of support (grant, tax payment installment, guarantee, surety, etc.),
• purpose (e.g., for training, research and development, environmental protection, increasing employment, restructuring),
• granting authorities,
• maximum amount of suport,
• duration of the program.

The state aid terms – legal acts of the European Union

• The Treaty on the Functioning of the European Union (art.107 and 108).

• The EU Commission’s Decree (EC) No. 800/2008 of August 6, 2008 declaring certain types of aid compatible with the common market in application of Articles 87 and 88 of the Treaty (General Block Exemption Regulation) 

The state aid terms - Solutions of Poland, Greece, Croatia, Spain and Italy.

POLAND

Poland introduced assistance for entrepreneurs in the form of the Anti-Crisis Shield and the Financial Shield.
The solutions adopted included : 
- exemptions from social security contributions, 
- financing of salaries and social security contributions,
- downtime benefits

GREECE

In Greece, the most important support mechanism for entrepreneurs was the repayable advance, which was paid in 7 cycles. The effectiveness of this measure was that the criteria for assistance were based mainly on losses recorded by entrepreneurs. 
Others: 
- guarantees of new working capital credits,
- credits,
- subsidies

CROATIA

Aid solutions for entrepreneurs in Croatia included:
-deferred and partial payment of customs duties, including income tax, 
- loans and credits,
- remuneration subsidies in the most affected industries.

SPAIN

Aid solutions for entrepreneurs in Spain included:
-financial guarantees and tax deferrals,
-loans,
-extension of commercial mortgages,
-temporary exemptions (ERTE).

ITALY

In Italy, assistance to entrepreneurs has mainly been in the form of financial support for loan repayment and the adoption of legal solutions to facilitate their acquisition, in order to ensure liquidity. 
Others:
- tax exemptions and concessions,
- subsidies.
 

 

 

Where to find information about the public aid?Click to read  

Where to find information about the public aid? – The European Union Financial Aid

The European Guarantee Fund - The fund set up by the European Investment Bank with contributions from EU member states to protect businesses affected by the COVID-19 crisis. Through guarantees, the fund enables loans, guarantees, asset-backed securities, equity instruments and other financial instruments to be made rapidly available mainly to small and medium-sized enterprises. 
https://www.eib.org/en/press/all/2021-147-european-guarantee-fund-accelerates-access-to-recovery-funding-for-eu-companies.htm?lang=pl 

The European Investment Fund and European Commission- Program- Loan Guarantees (COSME)
The COSME program is a European Commission program to support European micro, small and medium-sized enterprises. The program is managed by the European Investment Fund under what is known as an entrustment agreement with the European Commission. https://www.eif.org/news_centre/search/index.htm?keywords=COSME 
https://www.eif.org/news_centre/search/index.htm?keywords=covid-19

The European Commission. The state aid rules.
 https://ec.europa.eu/competition/state_aid/legislation/practical_guide_gber_en.pdf

European Commission. State aid for 2021: Commission expands the scope of the General Block Inclusion Regulation - Frequently Asked Questions.
https://ec.europa.eu/commission/presscorner/detail/en/qanda_21_3805

Ashurst.com. 2020 COVID-19 impact: navigating EU state aid.  
https://www.ashurst.com/en/news-and-insights/legal-updates/the-impact-of-covid-19-navigating-eu-state-aid

European Commission. State aid for 2020: Commission gives green light to pan-European guarantee fund to allow up to €200 billion in funding for companies affected by the coronavirus pandemic in 21 member states.  
https://ec.europa.eu/commission/presscorner/detail/en/ip_20_2407

Eif.org. 2020 COSME Loan Guarantee Facility (LGF).
https://www.eif.org/what_we_do/guarantees/single_eu_debt_instrument/cosme-loan-facility-growth/index.htm

POLAND

The State aid provided to entrepreneurs in Poland is monitored by the President of the UOKiK, who has got the System for the Provision of Data on State Aid (SUDOP). The SUDOP database contains information on aid measures implemented in Poland, aid granted under aid measures implemented in Poland, any public aid and de minimis aid granted to a given beneficiary.

Useful links:
https://uokik.gov.pl/unijne_akty_prawne_w_zakresie_pomocy_publicznej.php#faq334
https://sudop.uokik.gov.pl/home
https://www.gov.pl/web/tarczaantykryzysowa
https://instrumentyfinansoweue.gov.pl/

GREECE

Useful links:
https://elevategreece.gov.gr/
https://www.gov.gr/en/sdg/funding-business/finance-at-national-level/low-interest-rate-working-capital-loan-public-guarantee/entrepreneurship-fund-ii-tepikh-ii
https://endeavor.org.gr/
https://www.thehellenicinitiative.org/entrepreneurship-economic-development/
https://www.refugee.info/greece/setting-up-a-company-in-greece-greek-entrepreneurship/funding-my-business?language=en
https://www.enterprisegreece.gov.gr/

CROATIA

Useful links:
https://mjera-zrm.hzz.hr/korisnici-potpore/
https://www.sssh.hr/hr/vise/nacionalne-aktivnosti-72/rezultati-istrazivanja-sssh-o-utjecaju-pandemije-na-mentalno-zdravlje-radnika-4767
https://www2.deloitte.com/hr/hr/pages/tax/articles/vlada-prijedlog-mjera-gospodarstvo-koronavirus.html
https://www.rtl.hr/vijesti/arhiva/ekonomski-institut-zagreb-proveo-je-prvu-studiju-o-utjecaju-pandemije-na-poslovanje-mikropoduzeca-te-malih-i-srednjih-poduzeca-u-hrvatskoj-f825978a-b9f4-11ec-bf1e-0242ac13001e

SPAIN

Useful links:
https://www.lamoncloa.gob.es/consejodeministros/Paginas/enlaces/120321-enlace_ayudas.aspx
https://www.hacienda.gob.es/es-ES/CDI/Paginas/SistemasFinanciacionDeuda/AyudasCOVID/Linea-COVID.aspx
https://www.wolterskluwer.com/es-es/expert-insights/ayudas-para-pymes-y-autonomos-por-el-coronavirus

ITALY

Useful links:
https://www.camera.it/temiap/documentazione/temi/pdf/1211696.pdf?_1586257783260
https://www.agenziacoesione.gov.it/news_istituzionali/aiuti-di-stato-imprese-covid-19/?print-posts=pdf

Conclusions

Key takeawaysClick to read  

Tip 1: the State aid is aid granted to an entrepreneur by the state or by means of the state resources.
Tip 2: the State aid is divided into horizontal, regional and sectoral.
Tip 3: As part of the public aid, an entrepreneur may receive: grants, tax relief, loans, capital and investment subsidies, guarantees and warranties.
Tip 4: The aid rules are contained in various aid programmes adopted by means of legal acts (laws, regulations). 
 



Description:

The State aid is granted to an entrepreneur by the state or with the state funds, on terms more favorable than those offered in the market. Since the state aid can threaten to distort the rules of competition, it is allowed only in specific cases and under specific rules.
Therefore, it is worthwhile to learn about the types and conditions of the public aid that can support an entrepreneur in difficulty.


Keywords

State aid, availability, rules, forms of aid


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