To implement the National Plan for Economic Recovery (our initial note is available here), the Romanian government has enacted Government Emergency Ordinance no.130/2020 on certain measures for granting financial support from external non-repayable funds (“GEO 130”). The support scheme provides €1 billion in grants to various sectors of the economy, as follows:
- Qualifying beneficiaries: (i) small and medium enterprises (“SMEs”), which had no employees, as at December 31, 2019; (ii) authorized individuals (in Romanian: persoane fizice autorizate) and non-governmental organizations (“NGOs”) active in any industry sector listed under Schedule 1 of GEO 130; and (iii) authorized individuals and sole medical practitioners (in Romanian: cabinele medicale individuale) who dealt with patients diagnosed with COVID-19, have not benefited from the healthcare-related stimulus granted by Government Emergency Ordinance no. 43/2020, and which in each case meet the conditions set out in (2) below.
- Conditions to be met by the beneficiary: (i) they must have been operating for no less than one calendar year prior to the submission of the application; (ii) they must have had a turnover of no less than €5,000 in the financial year ended prior to the submission of the application; and (iii) they must continue to operate for no less than six months after receiving the grant.
- Amount and purpose: total amount of €100 million in the form of €2,000 grants per beneficiary, for the purpose of discharging rent, utilities, debt, stock supply, etc.
(B) Grants for working capital
- Qualifying beneficiaries: SMEs operating in the hospitality, tourism, transportation, events and art/creative industries and NGOs active in the education sector.
- Conditions to be met by the beneficiary: (i) they must contribute not less than 15% of the grant value to the working capital; (ii) they must obtain an emergency state certificate (“ESCs”) (our note on emergency state certificates is available in this link); (iii) they must have had an operating profit during at least one of the two financial years ending prior to the submission of the application; and (iv) they must maintain or increase the number of employees (other than seasonal or day workers) engaged at the date of the application for at least six months following the date of the receipt of grant.
Between August 1 and September 15, 2020, the Ministry of Economy will issue ESCs, on demand, to companies whose activity was affected by the COVID-19 pandemic during the state of emergency
- Amount and purpose: total amount of €350 million, divided as follows: (i) for SMEs with a turnover between €5,000 and €13,500 generated in the financial year ended December 2019, the grant value is €2,000; (ii) for SMEs with a turnover greater than €13,500 generated in the financial year ended December 2019, the grant value is 15% of the turnover, but no more than €150,000; and (iii) for affiliated companies that have submitted several applications, the aggregate value of the grant is up to €250,000; but if the NGO, as beneficiary, is an affiliated company and has submitted a single application, the grant value is a maximum of €150,000.
(C) Grants for investments
- Qualifying beneficiaries: SMEs active in industries such as pharma, food, auto, IT, construction, transport, tourism, education and healthcare. The full list of eligible sectors is provided in Schedule 3 of GEO 130.
- Conditions to be met by the beneficiary: (i) they must contribute not less than 15% of the total amount of the grant to the investment project, in the case of beneficiaries based outside of Bucharest and Ilfov County, and not less than 30% of the total amount of the grant to the investment project in the case of beneficiaries based in Bucharest – Ilfov County; (ii) they must have been operational for no less than one year prior to the submission of the application; (iii) they must have had an operating profit during at least one of the two financial years ending prior to the submission of the application; (iv) they must ensure project sustainability and continue operations for no less than three years after the expiry of the project’s implementation period; (v) they must obtain not less than 50% of the revenues budgeted in the business plan submitted with the grant application in its first two financial years of operation following the approval of the grant, and the 50% balance in the third year; and (vi) they must demonstrate reasonable investment costs.
- Amount and purpose: total budget of €550 million: €50,000-200,000 per project and beneficiary, depending on the financial needs of the project (to cover construction works, equipment, land, technology, environmental expenses, etc.).