Small businesses with the opportunity to apply for BGN 50,000 in aid

19.02.2021

SMALL BUSINESSES WITH THE OPPORTUNITY TO APPLY FOR BGN 50,000 IN AID

The Ministry of Economy is about to announce a procedure for selection of projects "Support for small enterprises with a turnover of over BGN 500,000 to overcome the economic consequences of the COVID-19 pandemic."

The purpose of the procedure is to provide operating capital for Bulgarian small businesses, which realized a turnover of over BGN 500,000 for 2019, to deal with the consequences of the COVID-19 pandemic.

Consultancy Center - Berkovitsa summarizes the preliminary information about the requirements of the procedure.

It is envisaged that the available budget under the procedure will be divided proportionally by sectors of economic activity according to Classifier of economic activities-2008 on the basis of statistical data on the number of small enterprises with a turnover of over BGN 500,000 in each of the sectors.

BGN 50 thousand is the maximum amount of the requested grant for an individual project.

The sectors of economic activity and the respective budget for them will be listed in the Guidelines for applying for the procedure. In case the budget for one of the sectors is not used, the Managing Authority reserves the right to redirect the free resource to those sectors for which the available funding is not enough.

The projects under the procedure should be implemented on the territory of Bulgaria.

Admissibility

1) Applicants who are legal entities or sole traders, registered according to the Commercial Law or the Law on Cooperatives.

2) Applicants who have at least two completed financial years (2018 and 2019) before the date of announcement of the procedure, within which they have carried out business activities;

(In connection with the requirement that the candidates have carried out economic activity in 2018 and 2019, in case the applicant has submitted a Declaration for an enterprise with income and expenses below BGN 500 or without activity for 2018 and/or 2019 to the NSI, it will be considered inadmissible under the procedure.)

(3) Applicants who meet the requirements for a small enterprise under the Small and Medium-sized Enterprises Act and the Commission Recommendation of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises (OJ L 124, 20.5.2003, p. 36).

4) Candidates should have realized a turnover for 2019 equal to or exceeding BGN 500,000.

5) Applicants may participate in the project selection procedure and receive a grant if they are not ineligible applicants under the demarcation line with other EU-funded plans and programs.

6) Candidates who have registered for a total of three months, selected by them, in the period from 01.02.2020 to the month preceding the month of application, an arithmetic mean decrease of at least 20% compared to the arithmetic mean turnover for the same three months for 2019.

7) Applicants who, as at 31 December 2019, are not subject to collective insolvency proceedings under national law and have not received rescue or restructuring aid or are no longer subject to collective insolvency proceedings under national law at the time the aid is granted and have not received rescue or restructuring aid.

Ineligible activities are those that were started and physically completed or fully implemented before 01.02.2020, regardless of whether all related payments have been made. Activities necessary to address the shortfall or lack of liquidity resulting from the COVID-19 epidemic are eligible.

The working capital funds provided under the procedure are in the form of a lump sum in the amount of BGN 50,000 and should be used to cover the current operating costs of the candidates: - raw materials and consumables; external services (including overheads) - personnel (including remuneration costs and costs for social security and health contributions at the expense of the employer), the value of which is calculated in the value of the production/service provided.

Ineligible costs include:

  • costs for activities that were started and physically completed or fully implemented before 01.02.2020, regardless of whether all related payments have been made;
  • for acquisition of tangible and intangible fixed assets;
  • costs of goods intended for sale;
  • costs for refundable VAT;
  • for taxes and fees;
  • expenditures financed by public funds;
  • costs of recovering support received from financial instruments financed by public funds;
  • for repayment of loans, interest on loans, bank fees;
  • for lease payments;
  • staff costs for applicants who have received public funding for staff (whether the funding is for part or all of the company's staff) during the period of eligibility of costs (after 01.02.2020 and until the final date of project implementation );
  • costs for second-hand raw materials, second-hand materials and second-hand consumables;
  • costs for the production, processing and sale of tobacco and tobacco products;
  • for preparation of a project proposal, project management and implementation;
  • expenditure declared ineligible under CMD № 189/2016 for the adoption of national rules on eligibility of expenditure under operational programs co-financed by the European Structural and Investment Funds (ESIF);
  • costs that do not fall within the eligible costs needed to address the shortfall or lack of liquidity resulting from the COVID-19 epidemic;

The duration of implementation of each project should not exceed 3 months from the date of entry into force of the administrative contract for the provision of grants.

A project selection procedure with one application deadline will apply, with a minimum deadline for submitting project proposals of 20 days from the date of announcing the project selection procedure.