EMERGENCY MEASURES - Support could also be granted for capital expenditure (No. 877)

According to the Czech-Moravian Guarantee and Development Bank (hereinafter “Bank”) Friday’s announcement all applications for the COVID interest-free loan were suspended. The applications already received will now be assessed so that the first loans can be granted within 14 days.

Small and medium-sized entrepreneurs who find themselves in financial difficulties due to the coronavirus pandemic can also get a loan to cover planned or realized investments through the Bank. Although it is not a financial instrument prepared for an ongoing pandemic, it may be an interesting alternative for many entrepreneurs that expect a slump in the future revenues.

The provided loan can be used to finance the eligible costs of tangible fixed assets - the purchase of machinery and equipment, the purchase and technical improvement of constructions and the purchase of land. Intangible fixed assets are also eligible expenditure.

The loan is interest-free with no administrative fees and amounting from CZK 1 to 45 million or up to 45% of eligible project´s expenditure. The maturity of the loan is up to 7 years or 10 years (if the loan is mainly intended for the purchase of real estate) and the Bank allows postponement of payments up to 3,5 years. One of the conditions for obtaining the loan is the simultaneous financing of the project through a commercial loan provided with by one of the Bank’s contractual partners in the amount of at least 20%. The Bank provides a financial contribution of up to CZK 2 million to cover interest on commercial loans. Projects can be implemented anywhere in the Czech Republic except the capital city of Prague.

All related documents are listed on the above link and KODAP advisors are ready answer your questions regarding preparation of the application.

Further pandemic-related tax, legal and economic information can be found on the Pandemic Information section of our website.

publikováno 25.03.2020