Investment aid for producing goods relevant to combating Covid-19

The Ministry of the Economy can grant financial aid to businesses investing in the production of goods relevant to combating the Covid-19 pandemic.

Who is concerned

Eligible businesses

Any business that holds a business permit (autorisation d'établissement) carrying out an investment project for the production of relevant goods in the fight against the Covid-19 pandemic

Certain businesses are excluded from the aid scheme; these are:

  • businesses that were in difficulty before 1 January 2020.
    A "business in difficulty" refers to any undertaking that fulfils at least one of the following conditions:
    • if it is a limited liability company (SARL, SA or SCA) other than an SME that has been in existence for less than 3 years, when over half of its subscribed share capital has been lost due to accumulated losses.
      This is the case when deduction of accumulated losses from reserves (and all other elements generally considered as part of the company's own funds) leads to a negative cumulative amount that exceeds half of the subscribed share capital; or
    • in the case of a company where at least some members have unlimited liability for the debt of the company (partnerships or limited partnerships) other than an SME that has been in existence for less than 3 years, where more than half of its own capital as shown in the company accounts has been lost due to accumulated losses; or
    • if the business has been subject to collective insolvency proceedings or fulfils the criteria under Luxembourg law for being placed in collective insolvency proceedings at the request of its creditors; or
    • when the business 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;
  • businesses that have been convicted at least twice in the past four years for illegal work or employing a non-EU illegal resident.

Eligible projects

The investment projects may relate to:

  • vaccines;
  • medication and treatment;
  • medical devices and hospital and medical equipment, including respirators and protective clothing and equipment, and diagnostic tools;
  • disinfectants;
  • tools for collecting and processing data, etc.

Prerequisites

The amount of aid is based on the business' eligible costs.

'Eligible costs' are the undertaking's investments in tangible and/or intangible assets:

  • connected with producing Covid-19-related goods such as:
    • medication, including vaccines, medical treatments and intermediate products;
    • active pharmaceutical substances and raw materials;
    • medical devices;
    • hospital and medical equipment, including respirators, protective clothing and equipment, diagnostic tools, and the necessary raw materials;
    • disinfectants and their intermediate products, and the chemicals necessary for their production;
    • tools for collecting and processing data;
  • costs relating to commissioning tests for new production facilities.

Deadlines

Aid applications must be submitted no later than 15 December 2020.

The request for a loss coverage guarantee must be submitted no later than 15 months after the 5th anniversary of the project closure date.

How to proceed

Filing an application

Applicants or their representative must complete the form and print it.

A person authorised to commit the company must sign the document.

The application, along with its supporting documents, can be sent to the Ministry of the Economy either electronically as a scan (covid.rdi@eco.etat.lu) or by post.

Sending the application electronically is the preferred option.

If the application is sent by post, the envelope should be addressed as follows:

Ministère de l’Economie
Direction générale - Recherche, propriété intellectuelle et nouvelles technologies (Direction de la Recherche et de l'Innovation)
19-21, boulevard Royal
L-2449 Luxembourg
Luxembourg
Postal address: L-2914 Luxembourg

On request, the company may also benefit from loss coverage of 30 % of its losses. However, this cover may not exceed EUR 500,000 in respect of production maintained over at least 5 years.

Supporting documents

The application must contain:

  • the name and size of the business in accordance with Annexe I of Regulation (EU) No 651/2014;
  • a description of the project detailing its relevance to the fight against Covid-19;
  • the start and end dates of the project;
  • a description of the economic and financial impact that the investment project will have on the business, and its effects on supply at national and European level;
  • the location of the project;
  • a list of costs of the project;
  • the amount of aid necessary for the investment and related operations;
  • if appropriate, justification of the need for loss coverage in relation with the investment.

The aid application may contain any other document deemed useful by the business and allowing the Minister to assess the merits of the application for aid.

Furthermore, the Ministry of the Economy may request any other document in order to facilitate the processing of the application.

Amount of aid

Direct subsidy

The amount of aid is calculated on the basis of the eligible costs, and may not exceed 80 % of the eligible costs.

It may be increased by 15 % of the eligible costs if the investment is completed within 2 months of the aid being granted or if another Member State grants aid for the same eligible costs.

Loss coverage guarantee

The amount of the loss to be compensated will be determined no later than 15 months after the 5th anniversary of the project completion date, and will correspond to the difference between:

  • on the one hand, the amount of:
    • eligible investment costs;
    • the opportunity cost of 10 % per year on the investment cost, over a maximum of 5 years;
    • the operating costs, over a maximum of 5 years;
  • and on the other hand, the amount of:
    • the capital grant received;
    • any other aid granted within the framework of the same investment project;
    • the revenue, over a maximum of 5 years;
    • the final value of the project.

The amount may not exceed EUR 500,000 per project if production has been maintained for at least 5 years after the completion of the project. If the company stops production before then, the maximum amount of loss coverage will be calculated on a pro-rata basis.

Payment of financial aid

This investment aid will be paid in the form of a capital subsidy once the project has been completed.

One or more advance payments may be made while the investments for which the aid has been granted are in hand.

Loss coverage also takes the form of a capital subsidy.

Cumulation of aid

This aid cannot be cumulated, for the same eligible costs, with the aid in favour of research and development projects connected with combating Covid-19.

The aid may be cumulated with:

  • with the de minimis aid, as long as the cumulation does not result in exceeding the most favourable maximum amount of aid provided for in the corresponding schemes;
  • the other types of aid in favour of research and development, as long as the cumulation does not result in exceeding the most favourable maximum amount of aid provided for in the corresponding schemes;
  • any other public funding, including from the European Union, as long as the cumulation does not result in exceeding the most favourable maximum amount of aid provided for in the corresponding schemes.

Disclosure of the financial aid

All individual amounts of aid granted are posted on the European Commission's transparency website at the latest within 12 months of being granted, in accordance with Annex III of Commission Regulation (EU) No 651/2014 of 17 June 2014. More specifically, granting authorities are required to publish the following information with regard to the individual amounts of aid awarded:

  • name of the beneficiary;
  • ID (VAT/identification number) of the beneficiary;
  • company type (SME/large company) at the time of granting (signature of the decision) the financial aid;
  • the beneficiary's region under NUTS II;
  • NACELUX Rev. 2 group activity sector;
  • the aid element, the amount of aid expressed in local currency;
  • financial aid instrument;
  • date on which the aid is granted;
  • purpose of the aid;
  • granting authority.

Obligations

The investment project must be completed within 6 months of the aid being granted.

Completion of the project is noted by the Minister.

Litigation

All decisions on refusing or partially refusing aid and all decisions on the reimbursement of aid are administrative decisions. Anyone concerned by such a decision may contest it via the usual means of appeal (non-contentious appeal, judicial appeal), provided the applicable legal deadlines are complied with.

Sanctions

If the project is not completed within 6 months of the aid being granted, the beneficiary will be required to repay, for each month of late completion, 25 % of the amount of aid received, unless the delay is due to factors beyond the beneficiary's control.

Beneficiary businesses that were granted aid shall be obliged to repay said aid if, before the project completion date agreed with the state, they:

  • abandon or transfer to third parties, for no objective reason, all or part of the project; or
  • manage the project improperly or not in accordance with generally accepted management rules; or
  • make fundamental changes to the objectives and methods of the project.

The aid may also be lost if, within a period of 5 years from the date of the full payment of the capital subsidy, the funds:

  • are allocated to other uses; or
  • are not used or are used for purposes and conditions other than those agreed with the State.

unless the beneficiary receives prior agreement from the Minister and the transfer, abandon or change in use is caused by force majeure or circumstances beyond the beneficiary's control.

Beneficiaries are also required to repay the aid if:

  • aid was obtained based on false or incomplete information provided;
  • the aid is found to be incompatible with the Grand Ducal regulation.

Reimbursement covers the amount of aid paid plus interest at the legal rate applicable at the time of granting, before expiry of a period of 3 months from the date of the ministerial decision on reimbursement, unless the decision provides for a different deadline.

A beneficiary of aid obtained on the basis of knowingly false or incomplete information shall be liable to a prison term of between 4 months and 5 years and a fine of between EUR 251 and 30,000 in addition to being required to reimburse the aid received.

 

Forms / Online services

Aide à l’investissement en faveur de la production de produits pertinents pour la lutte contre le COVID-19

Les informations qui vous concernent recueillies sur ce formulaire font l’objet d’un traitement par l’administration concernée afin de mener à bien votre demande.

Ces informations sont conservées pour la durée nécessaire par l’administration à la réalisation de la finalité du traitement

Les destinataires de vos données sont les administrations compétentes dans le cadre du traitement de votre demande. Veuillez-vous adresser à l’administration concernée par votre demande pour connaître les destinataires des données figurant sur ce formulaire. Conformément au règlement (UE) 2016/679 relatif à la protection des personnes physiques à l'égard du traitement des données à caractère personnel et à la libre circulation de ces données, vous bénéficiez d’un droit d’accès, de rectification et le cas échéant d’effacement des informations vous concernant. Vous disposez également du droit de retirer votre consentement à tout moment.

En outre et excepté le cas où le traitement de vos données présente un caractère obligatoire, vous pouvez, pour des motifs légitimes, vous y opposer.

Si vous souhaitez exercer ces droits et/ou obtenir communication de vos informations, veuillez-vous adresser à l’administration concernée suivant les coordonnées indiquées dans le formulaire. Vous avez également la possibilité d’introduire une réclamation auprès de la Commission nationale pour la protection des données ayant son siège à 15, boulevard du Jazz L-4370 Belvaux.

En poursuivant votre démarche, vous acceptez que vos données personnelles soient traitées dans le cadre de votre demande.

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