Eligibility

Service Eligibility Guidance for Business Clients

As you are being provided support, which may include a grant, at no cost to your business, this falls under a European rule called ‘State Aid’. All businesses, called Small and Medium Enterprises (SME for short), are allowed to receive a certain amount of aid, described below, and they also need to be what is called an ‘Autonomous SME’.

If you have been trading for more than three years, you also must not be an ‘Undertaking in Difficulty’. Lastly, our funds are not allowed to support businesses in certain industries/sectors. A note about these prohibited sectors is at the end of this document.

We set out below the summary detail of each of these requirements, which you must read and make an appropriate declaration on your enrolment paperwork. Your advisor support you to ensure that both you and we are fully compliant with the regulations, and may ask you to provide additional information in some circumstances.

State Aid

Public funding − such as funding that supports services like ours − must not distort competition within the European Common Market. The European Commission regulates the levels of assistance that the public sector can provide to businesses − called “the State Aid rules”. For you to benefit from our service, and to comply with the State Aid rules, we use what’s called the De Minimis exemption.

Under the De Minimis exemption, your business can receive up to a total of €200,000 of De Minimis Aid in the current and the two previous financial years, and still comply with the State Aid rules. You should therefore keep a record of all the aid you have received from any publicly funded service.

State Aid includes the following:

  • Rent free periods on publicly owned facilities. If the value of the annual rental is not known, an estimate should be made. The value of the rental may be discounted;

  • Loans from any public body at below commercial rates (in this case, the amount of aid is equivalent to the interest saving to the company);

  • Local Authority assistance, eg capital grants and loans at below commercial rates; loan guarantees which lower the cost of capital of the applicant business and rent free periods;

  • Lottery funding (very exceptionally where a project does not involve commercial competition, it may not be necessary to cumulate).

Due to Coronavirus and the support being provided to businesses by the government may also come under State Aid rules and, if provided under the Temporary Framework is limited to €800,000, but this is separate to De Minimis aid. If you have any questions of category of aid, please dont hesitate to contact the GetSet Accelerate team who will be happy to help.

Are you an SME?

The size of the business depends on the number of full-time equivalent (FTE) employees and its financial performance, and if it is linked to any other business. All businesses must meet the FTE employee limits as well as either the turnover or balance sheet totals to be an SME.

The data to apply to the headcount of employees and the financial accounts are those relating to the last approved accounting period and calculated on an annual basis. They are taken into account from the date of closure of the accounts. The amount for turnover is calculated excluding VAT and other indirect taxes.

Anyone who works a minimum of 35 hours per week counts as 1 full time employee (FTE), and this includes business partners and directors. Those working less hours should be calculated pro-rata, and if you work more than 35 hours, it still counts as 1 FTE.

Apprentices or students who are engaged in vocational training and have apprenticeship or vocational contracts, and employees on maternity or parental leave, are not included in the count. You will be asked to declare your turnover on your enrolment form. Please be reassured that this information will not be shared externally and will be treated in complete adherence to GDPR rules.

Are you autonomous?

If you are part of a group or where company directors’ have interests in other companies this needs to be taken into consideration when deciding on the size of the company. The definition of an SME recognises three types of business, according to their relationship and links with any other businesses in terms of holdings of capital or voting rights or the right to exercise adominant influence. If you fall into Type 1, then you can skip the rest of this section and go straight to the next section Undertakings in Difficulty.

Type 1: Autonomous Business

An applicant business is autonomous if it:

  • Does not have a holding of 25% or more in any other business; and

  • Is not 25% or more owned by any business or public body or jointly by several linked businesses or public bodies, apart from some exceptions; and

  • Does not draw up consolidated accounts and is not included in the accounts of a business which draws up consolidated accounts and is thus not a linked business.

You will be asked to confirm that you are an autonomous business on your enrollment form. Should you not fall into this category, ie, the 25% threshold is reached or exceeded, your advisor will need to ask you for additional information in order to determine if you are eligible under a different category.

Undertakings in Difficulty

If your business is less than 3 years old, you cannot be deemed an undertaking in difficulty, and can skip this section, moving to the last part on eligible sectors on the next page.

In effect, a business is considered to be in difficulty when, without intervention by the State, it will almost certainly be condemned to going out of business in the short or medium term. Undertakings in difficulty as defined under the State Aid rules should not be supported, in accordance with Article 3.3(d) of the ERDF Regulation (EU) No 1301/2013.

The definition that must be used when assessing whether an undertaking constitutes an undertaking in difficulty is set out in the General Block Exemption Regulation (GBER), No 651/2014 , Article 2 para 18, and the relevant extract for SMEs is below:

“‘undertaking in difficulty’ means an undertaking in respect of which at least one of the following circumstances occurs:

a. In the case of a limited liability company (other than an SME that has been in existence for less than three years or, for the purposes of eligibility for risk finance aid, an SME within 7 years from its first commercial sale that qualifies for risk finance investments following due diligence by the selected financial intermediary), where more than half of its subscribed share capital has disappeared as a result of accumulated losses.

This is the case when deduction of accumulated losses from reserves (and all other elements generally considered as part of the own funds of the company) leads to a negative cumulative amount that exceeds half of the subscribed share capital. For the purposes of this provision, ‘limited liability company’ refers in particular to the types of company mentioned in Annex I of Directive 2013/34/EU (1) and ‘share capital’ includes, where relevant, any share premium.

b. In the case of a company where at least some members have unlimited liability for the debt of the company (other than an SME that has been in existence for less than three years or, for the purposes of eligibility for risk finance aid, an SME within 7 years from its first commercial sale that qualifies for risk finance investments following due diligence by the selected financial intermediary), where more than half of its capital as shown in the company accounts has disappeared as a result of accumulated losses. For the purposes of this provision, ‘a company where at least some members have unlimited liability for the debt of the company ‘refers in particular to the types of company mentioned in Annex II of Directive 2013/34/EU.

c. Where the undertaking is subject to collective insolvency proceedings or fulfils the criteria under its domestic law for being placed in collective insolvency proceedings at the request of its creditors.

d. Where the undertaking has received rescue aid and has not yet reimbursed the loan or terminated the guarantee, or has received restructuring aid and is still subject to a restructuring plan.

All parts of the test must be applied (as appropriate) in order to determine whether an organisation is an undertaking in difficulty. If your advisor thinks that this situation may apply to your business, it will be escalated to our Finance Director and we will require you to provide additional information.

Ineligible Sectors

These sectors are not eligible for GetSet for Growth support due to State Aid rules:

  • Aid to fisheries and aquaculture and primary agricultural production.

  • Aid towards the processing and marketing of agricultural products which assistance is passed to primary production.

  • Aid to the coal sector except for the purpose of training aid, research and development and environment aid.

  • Regional aid to the steel sector, shipbuilding and synthetic fibres sectors and transport.

Some elements of retail activity are restricted – if your business is in retail, please get in touch to discuss your project to ensure eligibility.