Development Law

Manufacturing – Supply chain – Development Law 4887/2022

Investment amount to qualify
>150.000.000

Subsidy
15%-70%

Deadline
2023-09-29

The programme

Purpose of this scheme is to support investment projects belonging to the sector of Processing, with the exception of the processing of agricultural products for which a special scheme is established, and investment projects in the supply chain, aiming at technological, productive, administrative and organisational upgrading, as well as innovative and extroverted development and growth, in order to strengthen the competitive position of enterprises in the domestic and international market.

Who it concerns

The scheme applies to investment projects in the manufacturing sector other than processing of agricultural products and the creation of logistics facilities.

Τα επενδυτικά σχέδια πρέπει να έχουν ολοκληρωμένο χαρακτήρα αρχικής επένδυσης.

Investment projects must have the integrated character of an initial investment.

Επιλέξιμες επιχειρήσεις

Eligible are companies that are established or have a branch in Greek territory at the time of commencement of the investment project and have one of the following forms:

trading company,
cooperative,
Social Cooperative Enterprises (SPs) of 4430/2016 (A 2015)), Agricultural Cooperatives (AC), Producer Groups (POs), Agricultural Corporate Partnerships (ACPs) of Law 4384/2016 (A 78),
companies being formed or merged, with the obligation to have completed the disclosure procedures before the start of work on the investment project,
joint ventures engaged in commercial activity
public and municipal enterprises and their subsidiaries, provided that:
- they are not entrusted with the service of a public purpose,
- they are not exclusively entrusted by the State with the provision of services,
- δεν επιχορηγείται η λειτουργία τους με δημόσιους πόρους για το διάστημα τήρησης των
  μακροχρόνιων υποχρεώσεων του άρθρου 22.

Μη επιλέξιμες επιχειρήσεις

The following are not eligible and are excluded from aid under this scheme:

undertakings which are subject to pending aid recovery proceedings at the time of the submission of the investment project application (Deggendorf principle),
firms in difficulty, as defined in paragraph 18 of Article 2 of the General Tax Code (Article 1(4)(c) of the General Tax Code),
enterprises which in the two (2) years preceding the submission of the application for aid:
- have relocated the business establishment in which the initial investment for which aid is requested is to be carried out, or
- refuse to commit not to relocate the above business establishment for a period of two (2) years after the completion of the initial investment,
enterprises implementing investment projects carried out on the initiative and on behalf of the State, on the basis of a relevant contract for the execution of a project, concession or provision of services.

Eligible investment projects

The main objective is to provide a comprehensive framework of incentives with the key objective of generating business initiatives for existing, start-up or incipient enterprises intending to make an initial investment in one of the following eligible ways:

Create a new unit
Capacity expansion of an existing unit
Diversification of a unit's output into products or services that have never been produced in it
Θεμελιώδης αλλαγή του συνόλου της παραγωγικής διαδικασίας υφιστάμενης μονάδας

Highlights

For single investment projects submitted under this scheme involving the cultivation and processing of agricultural products, where the operation does not result in an agricultural product, only the part relating to the processing activity shall be supported
For investment projects of transport services with supply chain management to third parties (logistics - CN code 52.29.19.03):
- the provision of services to companies within the same group may amount to up to 30% of the total services provided
- their place of establishment should be distinct from the premises of other business activities of the company or group companies
For the establishment, expansion or modernisation of supply chain service units, a prerequisite, if they do not exist, is the implementation of investment projects for the installation and commissioning of integrated information and communication systems - telematics, to support the storage, loading and unloading and general management of materials and goods.

Program budget

The body's participation in the total eligible costs of the investment project can be done either through own funds or through external financing, provided that twenty-five percent (25%) of it does not contain any state aid, public support or provision (Article 14 par. 14 G.A.K.).

The same participation can also consist of external funding. The alternative ways of covering equity capital are:

Increase in share or company capital from new cash contributions
Capitalization of existing taxable reserves and retained earnings
Use of existing taxable reserves and retained earnings
Asset disposal
Bank loan

Amount of subsidy

The minimum eligible investment project size for the inclusion of investment projects in the present aid scheme is defined on the basis of the size of the entity, i.e:

large enterprises , in the amount of one million (1.000.000) euro,
medium-sized enterprises , in the amount of five hundred thousand (500,000) euros,
small businesses , in the amount of two hundred and fifty thousand (250,000) euros,
micro-enterprises , in the amount of one hundred thousand (100,000) euros,
for the Social Cooperative Enterprises (SCE) of Law 4430/2016 (A'205), as well as the Agricultural Cooperatives (DP), the Producer Groups (POs) and the Agricultural Partnerships (ABP) of the Law. 4384/2016 (A' 78) in the amount of fifty thousand (50,000) euros.

Types of aid

Tax exemption (exemption from payment of income tax on the pre-tax profits realised, which arise under the relevant tax legislation, from all the activities of the company, minus the tax of the legal person or legal entity on the profits distributed or assumed by the partners)

The investing entity may use the entire amount of the tax exemption aid to which it is entitled within fifteen (15) tax years from the year in which the right to use the benefit is established

Subsidy, which consists in the free provision by the State of a sum of money to cover part of the supported expenditure of the investment project and is determined as a percentage of the costs of the investment project
Leasing subsidy, which consists in the coverage by the State of part of the leasing instalments paid for the acquisition of new machinery and other equipment. The leasing subsidy may not exceed seven (7) years
The subsidy will be paid every six months and after each instalment of the rent is paid by the investing company
Subsidization of the cost of employment created

The aid rates for the eligible costs of the initial investment will be granted on the basis of the intensity ceilings of the Regional Aid Map as follows:

a. For micro and small enterprises, the aid rates for all types of incentives other than grants are granted at the maximum rate laid down in the Regional Aid Map.

The grant incentive is awarded at eighty percent (80%) of the Regional Aid Charter ceiling.

An increased grant rate (up to the maximum rate of the Regional Aid Charter) is granted for investment projects that:

They are implemented in the following areas:
- Mountainous areas, according to the classification of EL.STAT., except the municipal units that form part of the urban complex of Athens,
- areas located up to thirty (30) kilometres from the border,
- islands with a population of less than three thousand one hundred (3,100) inhabitants.
areas affected by natural disasters, in accordance with a decision of the Governmental State Aid Committee

They are implemented:

at Industrial and Business Areas (IBAs), Business Parks (B.E.P.), with the exception of Intermediate Business Parks (IBAs), Technology Parks and Innovative Activity Host Centres (IACCs) and Organised Hosts of Manufacturing and Business Activities (O.I.M.E.D.) and do not concern the modernisation or extension of existing structures of the assisted firm
in buildings classified as listed buildings
relate to the reopening of industrial units thathave ceased operations at least two (2) years before the date of submission of the application. The value of the fixed equipment of the industrial unit to be reopened must cover at least fifty percent (50%) of the eligible costs of the investment project.

b. For medium and large enterprises the aid rates for all types of incentives other than grants shall be granted at eighty percent (80%) of the ceiling of the Regional Aid Map.

Increased aid rates (up to the maximum rate of the Regional Aid Map) are granted for the investment projects implemented:

They are implemented in the following areas:
- Mountainous areas, according to the classification of EL.STAT., except the municipal units that form part of the urban complex of Athens,
- areas located up to thirty (30) kilometres from the border,
- islands with a population of less than three thousand one hundred (3,100) inhabitants.
- areas affected by natural disasters, in accordance with a decision of the Governmental State Aid Committee

They are implemented:

in Industrial and Business Areas (IBAs), Business Parks (BPs), with the exception of Intermediate Business Parks (IBAs), Technology Parks and Innovative Activity Hosts (IACHs) and Organised Hosts of Manufacturing and Business Activities (O.I.M.E.D.) and do not concern the modernisation or extension of existing structures of the assisted firm
in buildings classified as listed buildings
relate to the reopening of industrial units that have ceased operations at least two (2) years before the date of submission of the application. The value of the fixed equipment of the industrial unit to be reopened must cover at least fifty percent (50%) of the eligible costs of the investment project.

Special remarks

For the North Aegean Region the maximum aid rate is set for large enterprises at 55%, for medium-sized enterprises at 65% and for small and micro enterprises at 75%. These rates are considered for the time being to be the ceilings of the Regional Aid Map.
For investment projects implemented in the De-lignification Zones, which according to Law no. 4759/2020 are the Regional Units of Florina and Kozani and the Municipality of Megalopolis, the aid rates are the maximum of the Regional Aid Charter, depending on the size of the enterprise
For investment projects implemented in the Regional Units of Kastoria and Grevena and the Municipalities of Tripoli, Oichalia and Gortynia, the grant rate for small and micro enterprises set out in 90% and for medium-sized and large enterprises, the rate of tax exemption at 90% of the ceiling of the Regional Aid Map

Restrictions

The total amount of aid per submitted investment project can reach up to €3,000,000
The aid granted to each body, including aid to cooperating or associated enterprises may not exceed a cumulative total of 20 million euro. euros for an individual enterprise, and 30 million. euros for all related and cooperating undertakings, subject to the restrictions laid down in Article 4 of the General Tax Code.
The ceilings are increased by 50% where the aid is granted in the form of a tax exemption
For investment projects that do not meet the condition of being an integrated initial investment project, the aid granted may not exceed EUR 1 million (EUR 1 000 000).

Aid rates

These restrictions shall apply to investment projects subject to the provisions of this Regulation for a period of three (3) years from the date of the entity's application for the inclusion of its investment project.

Expenses subsidized

The investment projects covered herein may receive aid for eligible costs:

Regional in nature for initial investment, either independently or in combination with non-regional aid from the other sections of the G.A.K. and other European Union Regulations or
Exclusively non-regional from the other sections of the GAC and other European Union Regulations, in schemes provided for in Part B.

Regional investment aid

Regional aid is granted in accordance with the Regional Aid Charter for:

Initial investment:
- The investment in tangible and intangible assets in connection with the creation of a new business establishment, the expansion of the capacity of an existing business establishment, the diversification of the production of a business establishment into products that have never been produced in it, or the fundamental change of the entire production process of an existing business establishment.
- The acquisition of assets belonging to a business establishment that has closed or would have closed had it not been purchased and which is purchased by an investor unrelated to the seller and excludes a simple acquisition of the shares of a business.
Initial investment for new economic activity:
- The investment in tangible and intangible assets related to the creation of a new business establishment, or the diversification of the business establishment's activity, provided that the new activity is not the same or similar to that previously carried out in the establishment.
- The acquisition of the assets belonging to a closed business establishment which is purchased by an investor unrelated to the seller, provided that the new activity to be carried on using the acquired assets is not the same or similar to that practiced in the business establishment prior to the purchase.

Eligible expenditure for regional aid

Tangible assets

Construction, expansion, modernization of building facilities and special and auxiliary building facilities and the shaping of the surrounding area. The cumulative total may not exceed 45% of the total eligible costs.
For investment projects in the tourism sector, the rate is set at 60% for building costs, for investments in the logistics sector to 70% also for the building costs of these investment projects, while for investment projects for plant production in greenhouses the rate is 60%. Finally, for buildings classified as listed buildings, the rate is 80%.
Purchase of all or part of the existing fixed assets, such as buildings, machinery and other business establishment equipment, under the following conditions, which must be cumulative:
- the business establishment is closed,
the purchase is made by the entity of the investment plan, which is not related to the seller of the business establishment of approx. i unless it is a small business, which is acquired by an employee of the original owner,
the relevant transaction is carried out under normal market conditions. The cost of assets which have previously been subsidised or supported by development laws or other aid schemes prior to their purchase shall be deducted from this eligible expenditure
Purchase and installation of new modern machinery and other equipment, technical installations and means of transport that move within the area of the integrated unit
Leases for financial leasing of new modern machinery and other equipment
Modernization of special non-building facilities and mechanical facilities

Intangible assets

Transfer of technology, purchase of intellectual property rights, licenses, patents, know-how and unproprietary know-how
Quality assurance systems, certifications, software supply and installation and business organization systems

For large enterprises, the aided expenditure on intangible assets may not exceed thirty percent (30%) of the total aided regional aid expenditure. For SMEs the maximum percentage is fifty percent (50%).

Wage cost

The wage costs of new jobs created as a result of the implementation of the investment plan are subsidized, calculated for a period of two (2) years from the creation of each position.

Conditions for wage cost support

1. Mandatory net increase in the number of Annual Work Units (AWUs) compared to the AWUs of the previous 12 months from the date of application for membership

2. The filling of jobs should be within 3 years from the date of completion and start of production operation

3. Each job created through the investment shall be maintained in the assisted establishment concerned for a minimum period of at least five (5) years for large enterprises, at least four (4) years for medium-sized enterprises and at least three (3) years for small enterprises, from the date on which it is first created.

Eligible expenditure other than regional aid:

Consultancy fees for SMEs
Only for new small and medium-sized enterprises and up to €50,000 (up to 5% of total eligible costs)
Expenses for research and development projects (expenses for personnel, buildings, instruments, equipment, etc.)
Innovation expenditure for SMEs
They concern a budget of up to 20% of the total supported costs and up to 200.000 EUR
Expenditure on procedural and organisational innovation
They concern a budget of up to 10% of the total supported costs and up to 100,000 euros
Expenditures for the protection of the environment
Investment costs for energy efficiency measures
Investment costs for co-production of high efficiency energy from RES
Expenditures for energy production from RES
Vocational training expenses