The Government adopted a resolution of the Cabinet of Ministers of Ukraine dated March 3, 2021, № 200 “On approval of the Criteria for assessing the eligibility of state aid to economic entities to overcome the consequences caused by the coronavirus disease COVID-19”.
The document was developed by the Antimonopoly Committee of Ukraine together with the European Union Project “Support to the Antimonopoly Committee of Ukraine in Implementing State Aid Rules” (SESAR), the Ministry of Economic Development, Trade and Agriculture of Ukraine, and the Ministry of Finance of Ukraine.
The key task of the resolution is to create legal and organizational mechanisms for implementing the provisions of the Law of Ukraine “On State Aid to Business Entities” in terms of assessing the eligibility of state aid for temporary measures to support the economy in coronavirus COVID-19.
According to the resolution, the following is considered admissible:
- the assistance of up to € 400,000 for all businesses affected by quarantine measures that impede economic activity;
- investment aid for the production of relevant goods related to the prevention, occurrence, spread, treatment, and prevention of coronavirus COVID-19;
- assistance in the form of new guarantees for individual loans;
- assistance in the form of compensation of interest rates on loans;
- assistance in the form of deferred tax and/or social security contributions;
- partial unemployment benefits for the period of quarantine.
In particular, investment state aid for the production of relevant goods related to the prevention, occurrence, spread, treatment, and prevention of COVID-19 is eligible if all of the following conditions are met:
1) investment state aid is provided for the production of relevant goods related to the prevention, emergence, spread, treatment, and prevention of COVID-19, such as medicines (including vaccines), their intermediates, active pharmaceutical ingredients, and raw materials; medical devices, medical equipment (including fans, protective clothing and equipment, as well as diagnostic tools) and the necessary raw materials for their production; disinfectants and their intermediates and raw chemical materials necessary for their production; data collection (processing);
2) investment state aid is provided in the form of direct subsidies, tax benefits, deferral or installment payment of taxes, fees, or other mandatory payments during the quarantine period, but not later than six months after the abolition of quarantine;
3) investment state aid for the implementation of projects initiated before the beginning of the quarantine period should be necessary to accelerate the implementation or expand the scope of projects.
In such cases, only additional costs related to speeding up the implementation or expanding the scope of projects are eligible;
4) the investment project must be completed within six months after the abolition of quarantine. If the investment project is not completed within six months, the recipient shall reimburse the state aid to the state aid for 25 percent of the amount of aid provided in the form of direct grants or tax benefits, unless the delay is due to factors beyond the aid recipient;
5) eligible costs relate to all investment costs necessary for the production of goods referred to in subparagraph 1 of this paragraph, and costs related to the trial periods of new production facilities. The maximum amount of state aid should not exceed 80 percent of eligible costs;
6) the maximum allowable amount of state aid in the form of direct subsidies or tax benefits may be increased by an additional 15 percent if the investment is made within two months after the date of state aid or the date of application of the tax benefit;
7) investment state aid under this measure should not be combined with other investment state aid for the same costs;
8) investment state aid cannot be provided to economic entities that were already in a difficult situation as of December 31, 2019.