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Grant Fund

What is the Small Business Grant Fund?

The Small Business Grant Fund (SBGF) is a Local Authority administered grant programme that allows awards of £10,000 for eligible businesses in England.  It is open to businesses that on 11 March 2020 would have qualified for Small Business Rates Relief (including those in the £12,000 - £15,000 taper) or would qualify for the Rural Rate Relief Scheme.

The SBGF excludes:

  • properties which are considered to be for personal use (such as private stables, beach huts and moorings);
  • car parks and parking spaces;
  • businesses which were in liquidation or dissolved at 11 March 2020;
  • businesses which are not ratepayers; and
  • businesses which do not meet the relevant State aid exemption (see below). 

Further details of the conditions attached to the fund can be found in the Government guidance

What is the Retail, Hospitality and Leisure Grant Fund?

The Retail, Hospitality and Leisure Grant Fund (RHLGF) is a Local Authority administered grant programme allowing awards of:

- £10,000 for properties with a rateable value of £0-£15,000; and

- £15,000 for properties with a rateable value of £15,001-£51,000

to eligible businesses in England. 

It is open to businesses that as at 11 March 2020 would have qualified for the Expanded Retail Discount (including charities which would be within the Expanded Retail Discount had their payable rates not been reduced to nil).

The RHLGF excludes:

  • properties with a rateable value above £51,000;
  • businesses that are eligible for SBGF;
  • properties which are considered to be for personal use (such as private stables, beach huts and moorings);
  • car parks and parking spaces;
  • businesses which were in liquidation or dissolved at 11 March 2020;
  • businesses which are not ratepayers; and
  • businesses which do not meet the relevant State aid exemption (see below)

Further details of the conditions attached to the fund can be found in the Government guidance.

State aid law

Although the UK has left the European Union on 31 January 2020, the European State Aid rules still apply during the Transition Period (currently due to expire on 31 December 2020).

Payment of this grant constitutes State Aid, which is expected to be lawful on the basis that shall meet a scheme notified by the UK under 3.1 of the European Commission's Temporary Framework

To comply with this scheme you will be required to confirm that the award shall comply with 3.1 of the Temporary Framework, including that:

(a)        The amount of aid received by the business (including the wider business group ) under 3.1 of the Temporary Framework does not exceed €800,000 (£711,200 at April 2020);

(b)        The business is not an "undertaking in difficulty" (see below) at the date of this award (or was not on the 31 December 2019 and has faced difficulty as a result of the Covid-19 outbreak); and

(c)        the business is not active in the processing and marketing of agricultural products (or if the business is active in such a sector it agrees to ensure the support is not passed on to any primary producers of agricultural products).

If you would prefer to receive the aid on the basis of the De Minimis Regulation 1407/2013 please let us know.

The UK State aid guidance can be found at https://www.gov.uk/guidance/state-aid

Undertaking in Difficulty

The 'Undertaking in Difficulty' test can be found at Article 2(18) of the General Block Exemption Regulation which reads:

‘undertaking in difficulty’ means an undertaking in respect of which at least one of the following circumstances occurs:

(a) In the case of a limited liability company (other than an SME that has been in existence for less than three years or, for the purposes of eligibility for risk finance aid, an SME within 7 years from its first commercial sale that qualifies for risk finance investments following due diligence by the selected financial intermediary), where more than half of its subscribed share capital has disappeared as a result of accumulated losses. This is the case when deduction of accumulated losses from reserves (and all other elements generally considered as part of the own funds of the company) leads to a negative cumulative amount that exceeds half of the subscribed share capital. For the purposes of this provision, ‘limited liability company’ refers in particular to the types of company mentioned in Annex I of Directive 2013/34/EU ( 4 ) and ‘share capital’ includes, where relevant, any share premium.

(b) In the case of a company where at least some members have unlimited liability for the debt of the company (other than an SME that has been in existence for less than three years or, for the purposes of eligibility for risk finance aid, an SME within 7 years from its first commercial sale that qualifies for risk finance investments following due diligence by the selected financial intermediary), where more than half of its capital as shown in the company accounts has disappeared as a result of accumulated losses. For the purposes of this provision, ‘a company where at least some members have unlimited liability for the debt of the company’ refers in particular to the types of company mentioned in Annex II of Directive 2013/34/EU.

(c) Where the undertaking is subject to collective insolvency proceedings or fulfils the criteria under its domestic law for being placed in collective insolvency proceedings at the request of its creditors.

(d) Where the undertaking 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.

(e) In the case of an undertaking that is not an SME, where, for the past two years:

(1) the undertaking's book debt to equity ratio has been greater than 7,5; and

(2) the undertaking's EBITDA interest coverage ratio has been below 1,0.

The Council shall ask for a confirmation of the above at the point of the award, but may ask you for further details in due course, so we recommend retaining relevant information.

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