Treasury Support Line for Micro and Small Companies

The economic impact of the COVID-19 disease outbreak on the tourism sector and the unpredictability of its duration, justified the creation of a line of financing that acts in complementarity with other support measures for companies approved by the Government, in order to respond to the temporary needs of having an operating fund for micro and small companies, safeguarding their full activity and their capital.

Thus, the Law approving the State Budget for 2021 determined the creation of a treasury support line for micro and small businesses (MPE Support Line) that are in a situation of business crisis, under the terms provided for in the Decree-Law No. 6-C/2021, of January 15th, in its current wording.

Consequently, on September 14, 2021, Ordinance No. 192-A/2021 entered into force, which regulates the Treasury Support Line for Micro and Small Companies, aimed for Micro and Small Businesses and Entrepreneurs, with PME certification and organized accounting.

This line, managed by IAPMEI – Agency for Competitiveness and Innovation, has an initial allocation of €100,000,000 to finance treasury needs, in the form of a refundable subsidy, with a maximum support limit of €75,000 for small business companies and €25,000 for micro companies, corresponding to the value of €3,000 for each job in the company in the month immediately preceding the submission of the application, multiplied by three.

The financial support is repaid within a maximum period of 4 years from the date of the respective contract, including a grace period of up to 12 months and a fixed interest rate of 1.5%.

Companies that use this credit line undertake to maintain the number of jobs, existing on October 1, 2020, for a minimum period of 1 year after the granting of the financing, and it is not possible, during this period, to advance with collective dismissals, dismissals for extinction of the work position or dismissal due to inadequacy.

The beneficiary entities will also not be able to make distributions of dividends while the grace period of the loan capital is in force.

As eligibility conditions for beneficiaries, are companies that, at the time of application, meet the following conditions:

– Start of activity after January 1, 2019 and until September 30, 2020;

– Regularized situation with AT, Social Security, IAPMEI, Banking institutions and Banco Português de Fomento, SA;

– Not having an entity with headquarters or effective management in countries, territories or regions with a clearly more favourable tax regime (offshores);

– Do not have financing operations, approved or contracted, within the scope of a credit line or sub-line with a mutual guarantee created or supported by the Fundo de Contragarantia Mútuo to support the normalization of the activity of companies, at the date of submission of the application;

– Have made mandatory registration in the Central Register of the Effective Beneficiary (if applicable).

Micro and Small Companies that meet the conditions described above can already submit their application, from September 15, 2021, in electronic format, drafted and approved by IAPMEI, IP, with support granted until 31 December 2021.

The information provided in this information note is provided in a general and abstract manner, not substituting the use of appropriate legal advice for the resolution of specific cases. If you want additional clarification, please contact us using the available means.