European Commission has approved the last part of the Polish Financial Shield program for large enterprises and certain medium-sized enterprises (SMEs) in connection with COVID-19 outbreak. Application may now be submitted via a form provided by the PFR (Polish Development Fund). Overall budget of PFR Financial Shield Support Scheme for Large Enterprises amounts to approximately PLN 25 billion.
Available forms of financing
Under the PFR Financial Shield Support Scheme for Large Enterprises, the aid may take the form of:
- liquidity financing – interest-bearing and returnable loan granted for up to 4 years up to PLN 1 billion;
- preferential financing – interest-bearing, partially non-returnable preferential loan granted for up to 4 years up to PLN 750 million;
- investment financing (on market and aid terms) – through acquisition or subscription of equity instruments (ordinary and preferred shares in public and private companies) and hybrid capital instruments (convertible bonds and loans) up to PLN 1 billion.
General financing conditions:
Participation in the PFR Financial Shield Support Scheme for Large Enterprises may only be applied for:
- large entrepreneurs with (i) more than 249 employees or (ii) annual turnover in 2019 exceeding EUR 50 million and total assets exceeding EUR 43 million;
- SMEs
with more than 150 employees, with
annual turnover in 2019 exceeding PLN 100 million and
- whose financing gap according to the financial projections exceeds PLN 3.5 million and who exhausted financing possibilities from the PFR Financial Shield Scheme for SMEs or
- the financing applies to the Sector Scheme in connection with COVID-19.
It should be noted that as it relates to the Financial Shield, the size of an entrepreneur is measured by including the data of related parties.
To participate in the Scheme at least one of the following conditions shall be fulfilled:
- entrepreneur recorded decrease in turnover (sales revenues) of at least 25% in any month after 1 February 2020 compared to the previous month or corresponding month of the previous year as a result of COVID-19;
- an entrepreneur has lost ability to manufacture or provide services or to receive products or services by contracting parties, due to unavailability of components or resources in connection with COVID-19;
- entrepreneur does not receive payments for sales as a result of COVID-19 exceeding 25% of total receivables;
- entrepreneur does not have access to capital market or credit limits in relation to new contracts due to financial market disruptions;
- entrepreneur participates in the Sector Scheme in connection with COVID-19.
In addition, the Scheme may be applied for by entrepreneurs, who:
- are registered in Poland;
- have a tax residence in the EEA country and whose beneficial owner within the meaning of AML Law is not a tax resident of a tax haven;
- operated as at 31 December 2019;
- are not in arrears with payments of taxes and social security contributions;
- have not opened liquidation or against whom insolvency or restructuring proceedings have not been opened.
Finally, only enterprises that were not in economically difficult situation on 31 December 2019 are eligible for aid under liquidity financing, preferential financing and investment financing on an aid terms.
If you are interested in the Financial Shield solutions for Large Enterprises, we are at your disposal.
Marta Skrodzka
Tax Manager – Tax Adviser
E: mskrodzka@asbgroup.eu
