Liquidity Measures
Capital subsidy in the form of an advance
Government Measure
Certain companies can make an application for financial aid in the form of a reimbursable advance (up to a maximum of €500k) to cover operating expenses and rental costs incurred during the period from 15 March 2020 to 15 May 2020.
The aid shall be repaid based on a negotiated repayment plan that takes into account the income generated by the company in the financial year in which the aid was granted and over the following financial years. The advance must be repaid at an interest rate at least equal to the net value rate applicable at the time the aid was granted. The aid repayment will start no earlier than twelve months after the first payment of the repayable advance, unless requested otherwise by the company.
Eligibility
Artisanal, industrial and commercial companies with a business licence (whether SMEs or large companies).
The conditions to benefit from the aid are as follows:
- there must be an unforeseeable event (i.e., the COVID-19 outbreak) whose harmful or damaging impact on the economic activities of the company over a given period has been considered by Grand Ducal Regulation;
- the company must encounter temporary financial difficulties;
- the company was already conducting its business activities before the unforeseeable event; and
- there must be a causal link between those financial difficulties and the unforeseeable event in question.
Supervising Authority
Minister for Middle Classes, Minister for Economic Affairs.
Availability Date(s)
The relevant application must be submitted in writing by no later than 15 August 2020 and the aid is expected to be granted before 1 October 2020.
Moratorium granted by certain banks on the repayment of existing loans
Government Measure
The Luxembourg Government has agreed with some banks that they will grant clients, on a case by case basis, a moratorium and postpone the repayment dates of existing bank loans to avoid cash flow difficulties.
Eligibility
SMEs and large companies.
Supervising Authority
Finance Ministry and various financial institutions (e.g., Spuerkeess, BIL, BGL BNP Paribas, Banque de Luxembourg, ING, and Banque Raiffeisen, etc.)
Availability Date(s)
Until further notice
Relaxing of SNCI loan and credit terms
Government Measure
SNCI has agreed to automatically postpose (for six months) capital repayments with 31 March 2020 and 30 June 2020 due dates for direct and indirect loans made by SNCI. As this is an automatic postponement, no action is required from companies to benefit from this measure. The term of each loan benefitting from this moratorium is automatically extended by six months
Eligibility
SMEs and large companies.
Supervising Authority
SNCI (Société Nationale de Crédit et d’Investissement—National Credit and Investment Society)
Availability Date(s)
Available for capital repayments due in March 2020 and June 2020
State guarantee scheme for new bank loans (State Guarantee Scheme)
Government Measure
The Luxembourg State will serve as an 85% guarantor for a maximum period of six years in respect of new bank loans taken out by eligible SMEs and large companies. The Luxembourg Government has allocated a total budget of €2.5b for the State Guarantee Scheme
Eligibility
SMEs and large companies. The State Guarantee Scheme is limited to businesses that were financially viable before 18 March 2020.
In order for a company to benefit from the State Guarantee Scheme, the company’s bank will, in principle, notify the State Treasury of the granting of the loan in respect of which the Luxembourg State is to act as guarantor.
For more information on eligibility conditions please see this link
Supervising Authority
Financial institutions, Finance Ministry, Ministry of Economy
Availability Date(s)
Available for loans granted between 18 March 2020 and 31 December 2020
Special anti-crisis financing (SACF)
Government Measure
Eligible SMEs and large companies may be entitled to SACF, being loans part funded by SNCI and part funded by the company's bank. SNCI will make indirect loans of between €12.5k and €16.6m to fund up to 60% of the total loan amount with the company's bank funding the balance (i.e., at least 40% of the total loan amount). The maximum duration of the SACF is five years with an initial grace period on the repayment of the capital of up to a maximum two years.
Eligibility
SMEs and large companies which have a business licence.
Indirect loans from the SNCI are disbursed upon request of the company's bank.
For more information please see this link
Supervising Authority
Financial institutions and SNCI (Société Nationale de Crédit et d’Investissement—National Credit and Investment Society)
Availability Date(s)
SACF will be granted until 31 December 2020
SME guarantees in collaboration with banks active in corporate finance
Government Measure
The Luxembourg Chamber of Commerce via its “Mutualité de Cautionnement” will help SMEs facing financial difficulties and especially liquidity problems by providing guarantees for SMEs that need credit or a bank loan from banks active in corporate financing to obtain new working capital lines. The guarantee will be up to 50% of the credit or loan amount and will be subject to a maximum amount of €250k per guarantee.
SME’-s must apply directly to their banks to obtain financing guaranteed by the Luxemburg Chamber of Commerce under this scheme. A procedure for reviewing applications within 48 hours of submission has been put in place.
Eligibility
SMEs.
Supervising Authority
Financial institutions, SNCI (Société Nationale de Crédit et d’Investissement—National Credit and Investment Society), Luxembourg Chamber of Commerce
Further information can be requested via the following number: +352 42 39 39 445 or e-mail address:covid19@houseofentrepreneurhip.lu
Availability Date(s)
Currently being implemented and to remain in place until further notice.
Funding over five years for the SME Mutual insurance fund and the Surety mutual insurance fund (“Mutualité de cautionnement”)
Government Measure
Aid enabling the mutual insurance funds of professional chambers to expand coverage provided to SMEs.
Eligibility
SMEs.
Supervising Authority
SNCI (Société Nationale de Crédit et d’Investissement)—National Credit and Investment Society), Luxembourg Chamber of Commerce and Mutual Guarantee Scheme for SMEs—Trade (Mutualité de Cautionnement et d’aide aux Commerçants—MCAC)
Availability Date(s)
Currently being implemented and to remain in place until further notice
Investment aid for the production of products relevant to the fight against COVID-19
Government Measure
In order to support certain companies that reorient their production chains to manufacture products relevant to the fight against COVID-19 (e.g. protective masks or hydro-alcoholic gel), up to 100% of the investment costs linked to such reorientation will be borne by the General Directorate for Small and Medium-Sized Enterprises through the so-called "de minimis" aid.
Eligibility
SMEs and very small companies that redirect their production chains to manufacture products relevant to the fight against COVID-19.
Supervising Authority
Ministry of the Economy General Directorate for Small and Medium-Sized Enterprises (phone: (+352) 2477-4705; email: info.aide.pme@eco.etat.lu)
Availability Date(s)
Limited to the duration of the state of crisis period
Financial support for companies carrying out investments or R&D projects for medical equipment helping to combat the COVID-19 outbreak
Government Measure
The Luxembourg government has agreed to fund up to 100 % of the costs for fundamental research projects and 80% of the costs for industrial research or experimental development projects aimed at producing/developing medical devices and equipment to help combat the COVID-19 outbreak.
Eligibility
SMEs and large companies that hold a business permit and are carrying out an eligible project to help combat the COVID-19 outbreak. The eligible project must have started after 1 February 2020.
For projects that began before 1 February 2020, aid may only be applied for if it would make it possible to accelerate the work in hand or if the scope of the project could be extended. In these cases, only the additional costs involved in accelerating the work or extending the scope of the project are subject to this scheme
For further information and the application form, please click here.
The application form, along with the supporting documents, can be submitted electronically at covid.rdi@eco.etat.lu or be sent by post.
Supervising Authority
Ministry of the Economy General Directorate for the Research, Intellectual Property and New Technologies (Direction de la Recherche et de l'Innovation)
Availability Date(s)
Applications must be submitted during the state of crisis period
Financial aid to invest in equipment intended to set up a teleworking system
Government Measure
Eligible companies can apply for financial aid to invest in equipment to enable their employees to telework during the COVID-19 outbreak in order to reduce the spread of COVID-19. Such financial aid is linked to the General Investment Aid Scheme granted by the General Directorate for Small and Medium-Sized Enterprises of the Ministry of the Economy.
Eligibility
SMEs and very small companies that invest in equipment aimed at allowing their employees to telework during the COVID-19 outbreak.
Supervising Authority
Ministry of the Economy General Directorate for Small and Medium-Sized Enterprises (phone: (+352) 2477-4705; email: info.aide.pme@eco.etat.lu)
Availability Date(s)
Limited to the duration of the state of crisis period