Last Wednesday 29 March 2020 in the parliament held first reading the draft State Aid Act for rescuing or restructuring entrepreneurs (print 300). The project will now be handled by the Sejm Committee on Economic Affairs and Development.
The purpose of the Act is to assist entrepreneurs in financial difficulties. The project provides for tools to maintain liquidity within the time necessary to develop appropriate corrective actions and to finance these actions under the restructuring plan. The project provides, among others, for short-term loans (for the period 6 months) intended to save the undertaking. The amount of the loan will depend on the financial situation of the company.
The form of aid offered under this project is temporary restructuring support granted for the period up to 18 months
Another form of aid offered under this project is temporary restructuring support granted for the period up to 18 months. The aid granted will depend on the individual situation of the company. This type of aid is dedicated to companies which have the possibility to carry out the restructuring themselves, while they need support to be able to effectively carry out and complete the restructuring procedure.
The project also provides for restructuring aid. As the Ministry of Development explains, "it will be intended for entrepreneurs who would not bear the restructuring on their own, but have developed a plan for it, covering all the activities which are aimed at restoring the business's viability." Restructuring aid will finance this plan.
The condition for obtaining this form of aid is to have an own contribution to restructuring. The purpose of the restructuring aid is to remove the causes of the difficulties and not simply to compensate for the losses.
Furthermore, the proposed regulation introduces a new form of restructuring aid in the form of a reduction in the execution of an administrative fine.
Government has allocated support 120,000,000 PLN per year for a period 10 years. The money comes from the Treasury budget. It also provides for the possibility of a reduction in the restructuring of certain public-law claims of a total value 50,000,000 PLN A year.
Both small, medium and large enterprises in difficulty are in bankruptcy proceedings or are threatened with liquidation. Not all forms of aid are intended for all types of enterprises. However, the industry or the locations in which the company operates is irrelevant.
In order to receive aid, an entrepreneur in difficulty will have to submit a written application. The authority responsible for providing assistance will be the Minister responsible for economic affairs.
In contrast, State aid in the form of relief in the execution of the administrative fine will be provided by the authority which imposed the penalty. The Ministry’s Public Information Bulletin will inform the Minister responsible for Economic Affairs of the date of availability or exhaustion of the aid.
The Minister responsible for Economic Affairs will be able to entrust assistance to the Industrial Development Agency through an agreement.
We look forward to further work on the project. Let's hope it comes into force soon. The pandemic situation makes many companies want to benefit from this aid as soon as possible.