Coronavirus: Guidance for businesses
The impact of coronavirus (COVID-19) on business activity in Finland is considerable. Through various measures, the Government is seeking to ensure that businesses will be able to continue operating on a viable basis after the coronavirus crisis is over.
We have assembled important information here for businesses, including details of who to contact.
Enterprise Finland’s Talousapu financial assistance service offers advice to businesses facing payment difficulties and provides information on what to do in various situations caused by the coronavirus crisis. The national phone number of this service is +358 29 502 4880, and it is open Monday–Friday 9.00–16.00. More information on Suomi.fi
Advice also from
- Suomen Yrittäjät
- TE Offices
- Finland Chamber of Commerce
- Business Mentors Finland
- Business advisers of Finnish Enterprise Agencies and development companies (in Finnish)
Support for business costs
The objective of business cost support is to help companies in the difficult economic situation caused by the coronavirus. The Government is now proposing amendments to the Act on Support for Business Costs, which would make it possible to grant aid more flexibly, especially to sole entrepreneurs and small enterprises.
The Government submitted its legislative proposal to Parliament on 4 March 2021. After Par-liament’s consideration, the President of the Republic will approve the Act. Consequently, the State Treasury could start accepting applications from companies and sole entrepreneurs at the end of April. The basic conditions of the aid will remain unchanged.
Fall in turnover is a condition for receiving business cost support
The third round of business cost support is intended for companies whose turnover has fallen by more than 30% due to the coronavirus pandemic between 1 November 2020 and 28 February 2021, compared with the corresponding period in 2019–2020.
All companies can apply for business cost support. The Government will later issue a decree on the sectors that can apply for support without providing further justification. If a company does not operate in one of the sectors defined in the decree, it must justify the need for support and provide an account of the loss of turnover due to COVID-19. The decree will include the sectors where turnover has decreased by at least 10% during the period.
Sole entrepreneurs to apply for support at State Treasury
Support for sole entrepreneurs will be part of the business cost support. Municipalities will not organise a separate application round of support for sole entrepreneurs.
A minimum support of EUR 2,000 will be paid to sole entrepreneurs if they meet the conditions for it. The amount of support will be based on the decrease in the company’s turnover and actual costs.
To be eligible for business cost support, the company must have a Business ID. The company must also have eligible expenses of at least EUR 2,000 during the support period. As before, there will be no lower limit on the turnover of the company.
State Treasury: Business cost support
New compensation to companies for closure of customer premises
The Government proposes that companies be paid compensation if they, due to an Act or an official order, have to keep their premises closed in order to stop the spread of the coronavirus. This new form of compensation would apply to small and micro-sized enterprises that employ a maximum of 49 employees. The Government will prepare a separate compensation for larger companies as soon as possible.
The Government submitted the proposal to Parliament on 18 March 2021. The proposal supplements the proposal on the third application round for business cost support, which is currently under consideration by Parliament. The Act is due to enter into force on 12 April 2021. Companies would apply for the compensation at the State Treasury. Applications for the compensation could be accepted from the beginning of May.
This new form of compensation would apply to restaurants and other food and beverage service businesses that are closed from 9 to 28 March 2021 under the Act on Accommodation and Catering Operations. However, meals may be sold for takeaway. The amount of compensation would be based on that part of the company’s operations that the closure applies to.*
Compensation could also be paid to companies that the municipality or the Regional State Administrative Agency have the power to close under the Communicable Diseases Act. Such establishments include sports facilities, gyms, public saunas, swimming pools, spas and indoor playgrounds.
The compensation would be paid to companies for the period of closure if they are closed for more than 15 days. If a company has restricted the number of customers in its premises but has not closed completely, it would not be entitled to compensation. These companies can apply for business cost support.
The amount of compensation would be based on the company’s costs in February 2021 and the share of the company’s business operations that the closure affects. Compensation would be paid for 100% of payroll costs and for 70% of other costs, such as rent. Previously granted coronavirus support would be taken into consideration and the maximum amount of aid could not exceed EUR 1.8 million as per the EU State aid rules.
Loans and guarantees
Contact your bank or finance provider
If your business is temporarily in financial difficulty, you should take early action by first contacting your bank or other business finance provider.
The banks have already announced they are ready to consider loan repayment holidays and payment rescheduling due to the exceptional situation caused by the coronavirus epidemic. The Government is also taking action to improve the ability of banks to provide business financing.
Finnvera offers guarantees and loan repayment holidays
Finnvera is a state-owned company that provides specialised financing. It primarily offers various guarantees as security for business finance provided by banks. All types of companies are eligible for Finnvera's financing. Associations and non-profit foundations are not eligible, however.
If your business has a loan from Finnvera, Finnvera can grant loan repayment holidays on a flexible basis according to your needs.
Finnvera also grants guarantees on new loans. In such cases, you should first contact your own bank, as the bank will apply for a guarantee on behalf of your business. A Finnvera guarantee can cover 80 per cent of a bank loan if your business is entered in the Trade Register. Finnvera guarantees cannot be granted if you are self-employed but do not have your own company (‘kevytyrittäjä’, literally ‘light self-employed’), or if you work directly through a tax card, for example as a freelancer.
The guarantees are not a form of direct financial support. Finnvera charges a fee for its guarantees, and it uses these fees to cover its share of the credit losses that can occur when guarantees are given as security for loans. Guarantees of up to EUR 1 million are granted mainly without any security requirements. The fee charged depends on, for example, the loan period and the risk classification, which is based on the applicant company’s financial statements data. The charges made must also comply with EU regulations and the rules on government support. Finnvera is not permitted to compete with banks over financing charges.
Apply for Business Finland’s RDI loans
Business Finland has introduced a new research, development and innovation loan (RDI loan). This will be available to limited companies of all sizes (limited liability companies and public limited companies) and in all sectors.
The loan is intended for all companies operating in labour-intensive sectors in Finland that are suffering from business disruptions caused by the coronavirus crisis. The purpose of this loan finance is to help companies keep their employees in work during the crisis and also to encourage companies to explore opportunities for providing new jobs in Finland after the crisis is over.
Be part of Tesi’s funding programme
Tesi (Finnish Industry Investment Ltd) is a state-owned investment company specialising in the venture capital and private equity market. It is launching a funding programme to ensure that medium-sized companies that have run into temporary difficulties due to the coronavirus epidemic will be able to stay in business. Dealing with medium-sized companies, the programme will focus on businesses that are highly important in Finland in terms of their employment impact and turnover (turnover of at least EUR 10 million, more than 50 employees, profitable business operations before the crisis and potential for this in the future too). The investments will vary between EUR 1 million and EUR 10 million. The Tesi programme covers limited liability companies and public limited companies.
The aim is to prevent viable businesses going bankrupt as a consequence of a highly exceptional crisis that has had nothing to do with their operations. Tesi’s stabilisation programme will invest in businesses that are in a good position to overcome the financial difficulties caused by the coronavirus epidemic but require additional funding. This programme to deal with the liquidity problems faced by businesses complements the follow-on funding that Tesi announced earlier.
Investments to be made from this temporary programme offer a faster track to helping businesses cope with their liquidity crisis. Applications for this stabilisation funding will be taken on the Tesi website from Tuesday 14 April 2020. At the same time Tesi will also publish further details about the programme and the funding application process.
Apply to Tesi’s Venture Bridge programme
Through its Venture Bridge programme, Finnish Industry Investment (Tesi) invests in technology companies looking for international growth that have previously raised at least seed financing from professional venture capital investors and that have had to postpone their next external financing round due to the coronavirus situation.
Tesi will make the investments together and on equal terms with professional venture capital investors. The investments are made as convertible loans, which will be converted to equity in the next investment round. In this manner, the investments can be made quicker than in equity investments. Tesi’s Venture Bridge investments will be EUR 0.25–2 million in size and private investors will invest at least the same amount of capital in the company.
The Venture Bridge programme will supplement Tesi’s direct venture capital investments and will temporarily expand Tesi’s investment focus to early-stage venture capital financing. In addition to the Venture Bridge programme, Tesi will increase its investment volume for larger, later-stage venture capital financing rounds by, for example, utilising EFSI, its joint investment programme with the European Investment Bank.
Unemployment benefit to be available to entrepreneurs and self-employed
Entrepreneurs are temporarily entitled to labour market support to deal with the sudden and unforeseen decline in demand due to the coronavirus epidemic. This solution applies to all entrepreneurs regardless of the type of business.
Labour market support may be paid for the period of 16 March 2020 –30 June 2021 on the basis of a temporary provision due to the COVID-19 pandemic. After the end of that period, an entrepreneur must meet the usual conditions to be entitled to the unemployment security of entrepreneurs. For example, a decline in the workload or income of a full-time entrepreneur alone does not normally entitle the entrepreneur to unemployment benefit.
Support by sector
Temporary support for rural enterprises and agriculture for financial difficulties caused by the coronavirus pandemic
Temporary support for rural enterprises and agriculture helps companies whose financial situation has deteriorated due to market and production disruptions caused by the coronavirus pandemic. This form of support is intended to help companies adapt to the emergency conditions caused by the COVID-19 crisis and to continue profitable operations, and to secure jobs in the transition towards normal conditions.
Flexibility in the company's activities
Supporting businesses in their tax affairs
Entrepreneurs and self-employed persons and businesses in general, and their accountants too, may encounter difficulties in managing tax affairs as a result of the coronavirus situation. In cases of illness, for example, you can ask the Tax Administration for extra time to file your business’s tax return, and the charge for a late VAT return can be waived if there are justified special reasons for doing so.
If your business is in financial difficulty, you can request a rearrangement of your tax payments under new, more suitable terms. Note that you can also apply for changes to your tax prepayments in the Tax Administration’s ‘MyTax’ service if it looks like your business’s performance will fall short of the estimates made earlier.