
An extremely popular measure to deal with the consequences of the COVID-19 crisis was announced by the government. It is aimed at micro and small enterprises and consists of providing grants for financial aid. Below, we are presenting the details of the conditions and the application procedure.
The name of the programme is “Support for micro and small enterprises for overcoming the economical impact of the COVID-19 pandemic” and the goal is to provide operating capital to companies in the above categories that are supposed to have limited resources to ensure their normal functioning.
The programme is expected to start on 11th of May 2020 and the deadline for applications will be 30 days from the date of the announcement of the proposals. Expeditious application in this case plays a crucial role as project proposals will be funded until the resource, which amounts to 173 million BGN, is exhausted. If a project proposal is submitted, even if it is eligible, if the funds are exhausted, it will not be considered. Project proposals will be funded in the order in which they are received, as long as they meet the requirements, of course.
Let's take a more detailed look at the issues determining which persons could apply and therefore for what amount. Eligible applicants are juridical persons and sole traders registered under the Commerce Act or the Cooperatives Act with up to 50 employeesThe next requirement is that applicants must have been registered before 1 July 2019 and must have carried out business activities. They need to have recorded a minimum 20% decrease decrease in their turnover for the month of April 2020, compared to the monthly average turnover for 2019, and a minimum turnover for 2019 of BGN 30 000. Applicants should also have filed an annual tax return for 2019 with the NRA. The programme is open to applications from all sectors except those covered by the Rural Development Programme.
The question whose answer generates the most interest is the amount of the grant. The financial aid applied for must not exceed 10% of 2019 turnover. If your 2019 turnover is BGN 70 000, you could not apply for more than BGN 7 000. As we mentioned above, the minimum eligible annual turnover for 2019 is BGN 30 000, therefore the minimum aid is for the amount of BGN 3 000. The maximum amount of aid is BGN 10 000; that is, it is for all cases where the annual turnover for 2019 is equal to or exceeds BGN 100 000.
Regarding the application procedure, the most important thing is that the persons or their representatives (authorization is done by explicit power of attorney) have a qualified electronic signature (QES), as the whole procedure of filling in the forms will be online and will be done in the ISMM 2020 system.
In case it appears that there are any irregularities in the forms or missing documents, notifications will be sent to the applicants (again via the software mentioned above) and they will have 3 days to rectify the irregularities or submit the missing documents. It is very important that you or your representative check the system frequently, as the date of receipt of the notification will be the date on which it is sent to ISMM 2020.
In order to apply for a grant, it is necessary to submit specific documents as specified in the guidelines and explanations on the measure. The documents must prove that the applicants are eligible under the programme.
The expensesfor which the grant may be used are explicitly defined in the conditions for applications. These are limited to the costs of raw materials, consumables and supplies; external services (this includes overheads, a classic example of which is the cost of renting premises); staff costs (but this excludes costs for which 60/40 aid has been granted). An important point that was made in the draft conditions published on 15th of April 2020, in relation to activities for which costs have been incurred, is that they have not been started, actually completed or fully implemented before the date of the declaration of the state of emergency, 13th of March 2020. Should the expenditure incurred subsequently prove to be ineligible, it will be reimbursable.
Accurate declaration of both turnover and all other circumstances is of great importance, since if it is found that false information has been provided, resulting in the receipt of more financial assistance than is eligible, then all the assistance received will be subject to repayment, together with statutory interest.
KGK Law Firm can assist you in every aspect of the procedure, so do not hesitate to contact us if you need us.
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