“Strengthening the Establishment and Operation of New Small and Medium-Sized Tourism Enterprises”: Frequently Asked Questions – Answers for Action

The Decision to Approve the Frequently Asked Questions – Answers file for the Action “Strengthening the Establishment and Operation of New Small and Medium Enterprises” of the Program “Competitiveness 2021-2027” for the convenience of interested parties.

TYPICAL CONDITIONS

1. Question: Can a enterprise apply for funding to an eligible investment SDR and then set up a branch with an additional SDR not included in the respective call annex?

Answer: No, as the business should operate exclusively in eligible KAD throughout the implementation of the investment plan and until the investment is repaid.

2. Question: A natural person participates with a percentage of 1% in E.U. which has activity code 55.10. Can he participate in a company under formation which will submit a request to the program “Strengthening the Establishment and Operation of new Small and Medium-sized Tourism Enterprises” under KAD 55.20?

Answer: According to the detailed invitation of the action “The participation of a Natural/Legal Person as a partner is not permitted if it already has a business activity in operation in the KAD (2-digit analysis) of the investment in the same or in another region, on the date of the announcement of the action”. Therefore, in the above case, he cannot participate.

3. Question: Is a Natural/Legal Person who participates in an inactive business with KAD 55.20, i.e. in a company that has not carried out commercial activity, has no revenue, does not employ staff, eligible to participate as a shareholder in a business for the submission of a proposal with KAD investment 55?

Answer: It is not eligible as according to the invitation “The participation of a Natural/Legal Person as a partner is not permitted if it already has a business activity in operation in the KAD (2-digit analysis) of the investment in the same or another region, on the date of the announcement of the action”.

4. Question: Are companies that will purchase existing tourist facilities from another company and implement an eligible investment eligible for the program?

Answer: The operation of an existing tourist facility is eligible as long as the new business does not have as a partner the company or partners of the business that operated the tourist facility, and the existing tourist facility has been discontinued at least 3 months before the date of the announcement of the Action.

5. Question: A natural person does not have participation as a partner/shareholder in a company with KAD 55, but is a legal representative or holds the position of President and/or the position of CEO in a company with KAD 55. Can he submit an application with a company under foundation that will have KAD 55?

Answer: He can submit an application as only as a legal representative or holding the position of President and/or the position of CEO he does not carry out business activity. Business activity is carried out by the partner/shareholder of a business.

6. Question: Is a proposal eligible where the business has started before 12 months with a unique KAD of the special status farmer?
Answer: Yes, it is eligible as long as they do not have an obligation to keep accounting books and do not carry out a business/commercial activity, as defined for the sector of farmers in article 2 par. 1a of Law 3874/2010, as applicable.

7. Question: How is the duration (6-year/12-year) of a lease/grant lease calculated?

Answer: The duration of the lease/grant should be 6 years (or 12 years) from the date of the announcement of the Action regardless of the start date of the lease. Lease starting e.g. 18/2/2024 should have a minimum expiry date of 17/12/2029 (6 years) or 17/12/2035 (12 years).

8. Question: For an investment project with a total budget of €100,000, what amount should be documented to cover the private participation at a rate of 60%?

Answer: According to the detailed invitation of the Action Chapter 4. BENEFICIARIES – TERMS & CONDITIONS as a standard condition is the presentation of evidence of securing the private participation of the proposed investment project at a rate of at least 60% of it. Therefore, if the subsidized budget of an investment project is €100,000 with a subsidy rate of 45%, DD €45,000, 60% of the private participation (€100,000-€45,000) should be documented, i.e. 60% of €55,000, i.e. €33,000.

9. Question: For an investment project with a total budget of €450,000, what amount should be documented to cover the private participation at a rate of 60%?

Answer: The documentation for covering the private participation at a rate of 60% is done in the proposed/requested subsidized budget of the investment project and not in the total requested.

Consequently, for a business plan with a proposed budget of €450,000 and a D.D. rate of 50%, the Public Expenditure amounts to €200,000, the proposed subsidized budget to €400,000 and the non-subsidized budget to €50,000. The private participation should be at least: 60%*€200,000 = €120,000. Otherwise, the standard condition for participation in the Action is not met.

10. Question: Can a business (newly established or under formation) implement its investment plan in a residence?

Answer: The company should implement its investment plan in an independent /
distinct business area.

GROUNDS FOR SUBMISSION/ENTRY – GRADING CRITERIA

11. Question: If the property belongs to a shareholder/partner of the company being established, what supporting documents is required to be provided when submitting the application to document ownership for investment purposes?

Answer: The existence of property for the purposes of investment is documented by presenting a copy of the title deed and a transfer certificate from the competent Mortgage Registry or a certificate of registration of a registrable deed from the competent Land Office. In the event that the property also belongs to a third party who does not participate in the company being established, written consent of this person in the form of a responsible declaration must be submitted, with which he expressly and unconditionally grants his consent for the use of the property for the purposes of the investment.

12. Question: How is the existence of rights of use on the investment property for an entity under establishment (a legal entity/company other than a sole proprietorship), in the event that it is not owned by a shareholder/partner of the enterprise under establishment, documented?

Answer: Since the business has not been established and the property belongs to a third party who is not a partner/shareholder of the business being established, its legal use is documented either by a concession agreement without consideration/loan or by a lease agreement between the owner of the property and the natural person who participates in or represents the business being established.

13. Question: How is the existence of rights of use on the investment property documented for a company established before the date of publication of the Detailed Invitation?

Answer: The existence of rights of use in the event that the property belongs to the legal entity is documented by presenting a copy of the title deed and a transfer certificate from the competent Mortgage Registry or a certificate of registration of a registrable deed from the competent Land Office. In the event that the property does not belong to the legal entity, its legal use is documented either by a concession agreement without consideration/loan or by a lease agreement between the owner of the property and the legal entity.

14. Question: Must the building permit have an issue date prior to the notice?

Answer: The building permit (or any other document referred to in the invitation submitted instead of the building permit) must have a date of issue prior to the submission of the application and be valid.

15. Question: In an existing building where small-scale work / renovation is to be carried out, is it a prerequisite that the small-scale work approval be submitted when submitting the proposal?

Answer: In the event that the investment plan foresees costs for buildings and other facilities, for which the issuance of a building permit is not required, a Responsible Declaration of the Legal Representative must be presented, where it will be confirmed that the issuance of a building permit is not required with a relevant detailed justification.

16. Question: Is a building permit issued in the name of the owner of the property and not a partner/shareholder of the investment entity eligible for either a business under establishment or a newly established one?

Answer: It is eligible if it appears from another document (e.g. title deeds, lease, concession) that the investment entity has the rights to use it.

17. Question: A business has a building permit for two houses. Can he modify the license and add another one?

Answer: For the case described in the question, it is required that the building permit has been revised or at least a request for its modification has been submitted by the date of submission of the financing application.

18. Question: Can the documentation of the same participation be done with bank account balances from foreign banks?

Answer: For proof of private participation, all financial institutions from EU countries, Switzerland and Great Britain that operate legally in their country of establishment are accepted.

19. Question: If more than one partner participates in either a newly established or an under-established business, can only one partner show bank balances?

Answer: Proof of the coverage of the Private Participation by one partner is accepted when submitting the financing application, provided that in the implementation of the investment all partners/shareholders have paid into the company’s capital the amount of the Private Participation attributable to them according to their percentage of participation in the corporate structure.

20. Question: Is the approval or intention of a loan in the name of the natural person/partner and not the company, in the case that it has not been established (Category A), to cover the same participation, acceptable?

Answer: In Category A (under establishment) the approval or intention of a Loan is acceptable in the name of the natural person who participates in the corporate structure either as a legal representative or as a partner, provided that the approval or intention of the Loan mentions the basic terms of lending, as defined in Appendix I of the Invitation.

21. Question: In order to cover the same participation, can funds of persons held in joint bank accounts with other beneficiaries be provided (bank account with joint beneficiaries)?

Answer: The coverage of the same participation can be done through bank balances from an account in which, in addition to the beneficiary, there are other co-beneficiaries.

22. Question: For a company under establishment, can the legal entity that participates in it, provide corresponding bank statements and a decision of the General Assembly for the participation in the payment / increase of the capital of the investment entity?

Answer: Yes, it is accepted to cover the private participation of a legal person who participates as a partner/shareholder in a company under establishment, with the presentation of the corresponding bank certificates, provided that they are accompanied by a relevant decision of a competent body on the commitment of funds to cover the same participation of the investment in the context of legal actions/procedures for this purpose depending on the legal form of the company. It is noted that the same applies to newly established businesses that participate as a partner/shareholder in the capital increase of the investment body.

23. Question: At what exchange rate will the Private Participation be calculated in case of foreign currency? With buy price, sell price or average price?

Answer: In the case of certificates in foreign currency, their conversion will be carried out based on the official exchange rate (based on the European Central Bank) that was in effect on the date of issue of the certificate presented and will be calculated based on the selling price.

24. Question: As documentation of private participation, can confirmations of bank accounts belonging either to a sole proprietorship of a shareholder of the investment entity, or to a business (legal entity) in which the shareholder of the investment entity participates be submitted?

Answer: Documentation of private participation with confirmation of bank accounts of other companies in which a shareholder of the investment entity participates as a natural person is not accepted.

25. Question: Can a start-up company (category A) established after the announcement of the Action prove the coverage of the Private Participation partly with the balances of the company’s current bank account (providing the corresponding documents required for the incorporation capital, e.g. minutes of the Board of Directors, proof of deposit of cash contributions, etc.) and partly with the balances of the bank accounts of natural persons who participate?

Answer: If the company has been incorporated after the date of the notice and capital has been paid by the partners at the time of its incorporation, then the proof of coverage of the Private Participation is acceptable partly through the already paid founding capital of the company (with presentation of all the relevant documents, as defined in Appendix I of the Action) and partly through bank balances of physical accounts of persons on the last day of the month preceding the
electronic submission of the proposal and average available balances of the preceding month prior to the month of submission of the funding application.

It is noted that for newly established companies proof of coverage of private participation is acceptable partly through the already paid share/corporate capital increase and partly through bank statements of the accounts of natural persons as defined in Annex I of the Action.

26. Question: For a company under establishment, by whom is the Responsible Media Declaration and the Responsible Declaration model C completed and what is the reference year of completion?

Answer: Y.D. they are completed by the representative of the company under establishment who is designated by the Responsible Declarations of point a/a 1 of Annex I and the reference year is the last closed management year, i.e. 2022.

27. Question: In the event that an associated/collaborating company had no staff during the years under review, what supporting document should be provided?

Answer: Since he had no staff and this is not documented by the company’s E3, then a relevant ID should be presented. by its legal representative.

28. Question: How will a business be able to receive the additional 10% grant rate as stated in the KEF. 8.2 “Assistance Rates – Financial Scheme” of the detailed Call for Action?

Answer: In order for the beneficiary company to receive the additional 10% in the event that the place of implementation concerns a fire, earthquake or flood affected area, it must declare to OPSKE the relevant gazette, as applicable, and/or the decision to document the classification of the investment implementation area in one of the above categories and its time validity. In the event that the place of implementation concerns remote areas or small islands, the definition of the Special Area (remote area or small islands) is made in accordance with the Directive “on the Community list of disadvantaged agricultural areas within the meaning of Directive 75/268/EEC (Greece)”, as applicable.

29. Question: Since a company has been established after the announcement of the Action and before the submission of the proposal, it must provide supporting documents of its legal status.

Answer: If the company has been established after the announcement of the Action, it is assessed as a company under formation and must provide the supporting documents listed in Appendix I of the Action invitation.

ELIGIBILITY OF EXPENDITURE

30. Question: According to the detailed call in Appendix I of the Submission Documents, it is stated that when submitting the financing application, two bids must be submitted for each expenditure in the category “Machinery – Equipment” (A/A 2) with a net value of more than €50,000. Does this requirement apply at an expense level or expense category?

Answer: This requirement is applied to every distinct physical object, at the level of (registration) expenditure in OPSKE, regardless of the subcategory to which it belongs. It is pointed out that the single expenditure for the same physical object should not be divided in order to avoid the specific obligation. If at least two (2) offers are not submitted, the said expense is rejected. Only in the case of not being able to present a second offer (e.g. special constructions, etc.) is one (1) submitted accompanied by relevant documentation.

IMPLEMENTATION PROCESS – MONITORING OF ACTIONS

31. Question: Is there an obligation to maintain the shareholder/corporate composition of the beneficiary company, after the completion of the investment (final payment)?

Answer: It is noted that, according to what is mentioned in Chapter 4 “BENEFICIARIES OF THE ACTION – TERMS & CONDITIONS OF PARTICIPATION” of the invitation, the corporate/shareholder composition and the legal form of the business should remain the same during the implementation, until the completion of the physical and financial object and the repayment of the investment. It is noted that according to chapter 14.2 OBLIGATIONS OF BENEFICIARIES AFTER COMPLETION OF THE DEED (LONG-TERM OBLIGATIONS) there is no such limitation.

32. Question: How many EMEs must the company have in order to reach the target for the additional 5% of the grant rate?

Answer: The business must commit to having 0.2 FTE of hired labor in the first year after the investment is completed.

33. Question: EME salaried work, the cost of which is subsidized by another Agency (e.g. OAED), is it counted towards the achievement of the goal related to the additional 5% aid rate?

Answer: No, waged labor subsidized by another body is not counted in the EME of the enterprise EME, e.g. OAED as this EME is indirectly subsidized through the Action due to the increase in public funding from 45% to 50%.

34. Question: What is the date of completion of the physical and financial object of the project?

Answer: The last action by the beneficiary (last invoice and/or last payment) defines the date of completion of the physical and financial object of the project.