Temporary amendments to business development aid
By decree of 15 October, the Government has enabled the granting of business development aid in the form of so-called temporary state aid for a maximum of EUR 800,000 per company. In addition, the decree allows the granting of aid to small companies that have been in difficulties before 1 January 2020. The temporary amendments will be in force from 19 October to 31 December 2020.
The amendment to the decree is based on the European Commission’s communication on the temporary framework on state aid measures and Finland’s state aid scheme. The purpose of the amendments is to help companies overcome the difficulties caused by the coronavirus epidemic. ELY Centres are responsible for granting business development aid to companies.
Development aid can be granted as temporary state aid
Under the current Government Decree on Discretionary Government Transfers to Develop Business Operations, the granting of aid as temporary state aid is only possible in the event of market and production disruptions. The amendment to the decree allows the granting of business development aid in the form of temporary state aid for a maximum of EUR 800,000 in accordance with the Finnish state aid scheme, including in cases where basic business development aid is granted to companies for development measures or investments.
The business development aid granted by the ELY Centres can therefore also be granted to companies, which were previously disqualified because of meeting the de minimis aid quota. De minimis aid refers to small amounts of aid that may be granted to companies for a maximum of EUR 200,000 over three fiscal years.
Granting of development aid to small companies in difficulty before 1 January 2020
The amendment to the decree also makes it possible to grant development aid under the Finnish state aid scheme to small companies, which have been in difficulties before 1 January 2020. The condition for granting aid to a small company in difficulty would be that the company is not involved in bankruptcy or restructuring proceedings at the time the aid is granted and that it has not received rescue aid or restructuring aid. In this context, a small company is defined as employing fewer than 50 employees and having an annual turnover or balance sheet total of less than EUR 10 million.
Although the amendment to the decree provides for the possibility of granting development aid to a company in difficulty, the decree does not change the general conditions for granting aid under the Government Decree on Discretionary Government Transfers to Develop Business Operations. The granting of aid will continue to require that the company is assessed to have the conditions to continue profitable operations, that the aid is estimated to have a considerable impact on the implementation of the project and that the project is considered significant for the development of the company’s operations.
The amendments will be in force from 19 October to 31 December 2020.
Emmi Äijälä, Senior Specialist, Ministry of Economic Affairs and Employment, tel. +358 29 504 7216
Raimo Puhto, Senior Specialist, Ministry of Economic Affairs and Employment, tel. +358 29 506 3688