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Part Two: New Development Law 4399/2016
January 11 2017

Part Two: New Development Law 4399/2016

Types of aid

a) Tax exemption (exemption from the payment of income tax on earnings before tax as a percentage of the value of the expenditure supported by the investment project)
b) Grant (free of charge from the State to cover part of the expenditure supported)
c) Financial leasing subsidy (covering part of the leasing installments paid for the acquisition of new machinery and not exceeding 7 years)
d) Subsidy for the cost of the job creation (cover of new job costs)
e) Stabilization of income tax rate
f) Financial instruments (equity, loans)

Assisted expenses

The eligible regional aid for implementing the aid schemes is as follows:

a) tangible assets:

  • Buildings: the construction, expansion, upgrading of building facilities as well as special and auxiliary building facilities from 45% to 80% of the total eligible costs.
  • Purchase of all assets of a business: (buildings, machinery, equipment) if the plant has ceased to operate (machines and equipment are up to 7 years old).
  • Equipment: purchase and installation of new modern machinery and other equipment.
  • Leasehold Leases: provided that they become the lessee's ownership at maturity.
  • Modernization of special and mechanical installations: buildings are excluded.

 

b) Intangible assets:

  • Technology transfer: through the purchase of intellectual property rights, licenses, patents, know-how and unpatented technical knowledge.
  • Security and control systems: quality, certification, supply and installation of software and systems for organizing the business.

 

c) Salary cost of new jobs: refers to jobs created as a result of the implementation of the investment plan and for a period of 2 years
The eligible expenses outside regional aid for the implementation of the aid schemes are as follows:

  • Start-up for very small and small businesses.
  • Advisory services to SMEs.
  • Innovation for SMEs.
  • Process and Organizational Innovation for SMEs.
  • Innovation clusters.
  • Energy efficiency measures.
  • High-efficiency cogeneration from RES.
  • Self-production of electricity or heat from RES as well as for the production of electricity from small hydroelectric projects.
  • Installation of efficient district heating and cooling systems.

 

Schemes for investment project support

1. Aid for mechanical equipment
The objective is to speed up the integration of enterprises of all types without a competitive procedure and to pay the aid directly by conducting administrative checks on mechanical equipment.
Under this scheme, expenditure on mechanical equipment and means of transport used within the unit is supported.
2. General Entrepreneurship
The objective is to support businesses of all types, for the full range of eligible expenses provided for by the General Excise Regulation (GAC).
It concerns all investment projects defined in the provisions of the law.
3. New Independent SMEs
The objectove is to specifically strengthen new independent small and medium-sized enterprises through increased benefits.
It concerns enterprises under establishment or start-ups set up within the last seven years from the date of submission of the application.
4. Innovative investments for SMEs
The objective is to establish or strengthen the innovative nature of products or processes through the continuous commitment to innovation of the assisted enterprises
5. Synergies and Networking: Business Clusters
The aim is to strengthen the competitiveness of the companies involved in the schemes through defined collaborative projects related to production, productivity and marketing.
6. Intermediate Financial Institutions - Holdings Funds
The objective is to set up and participate the Greek State in Participation Funds, aiming at the greatest possible leverage of resources with private sector resources.
7. Integrated Spatial and Branch Plans
The objective is to increase - but also protect - employment, and regional convergence by exploiting the comparative advantages of an area and enhancing local interconnections.
8. Major investments
The objective is to create an investment environment that will facilitate the implementation of very large investment projects.

The specific categories of aid are granted to the following categories of undertakings:

  • in extrovert, with an increase of 10% on average on average over the last 3 years,
  • to innovative, with research costs exceeding 10% of operating costs (over a year over the last 3 years)
  • to those that are merging,
  • to those with an increase in their employment of more than 10% in the last 3 years
  • in Cooperatives, Social Cooperative Enterpises of Law 4019/2011 (Α`216), as well as in Producer Groups (POs), Rural Partnership and Cooperative Societies (SA) 4015/2011,
  • in enterprises operating in the fields of Information Technology and Communication and Agri-Food,
  • in companies that achieve increased value added, defined by ELSTAT, in relation to the average of their industry,
  • in companies to establish units in Industrial Areas, Business Parks, Technological Parks,
  • in these, which operate in Special Areas (mountain, border, with a large population decline, islands with a population of <3,100 inhabitants, etc.). Borderline means the areas within 30 km of the border, as well as the islands of the North Aegean Region, Samothraki and the Dodecanese Islands,
  • businesses operating in islands with particularly high migratory flows and in particular: Agathonisi, Kalymnos, Kastelorizo, Kos, Leros, Lesvos, Samos, Symi, Chios.

 

Investment projects subject to the aid schemes
Aid schemes under this Law shall be subject to investment plans of all sectors of the economy subject to the provisions of the law.
In the tourism sector, there are investment projects that concern:

  • Establishment or expansion of hotel units of at least three (3) stars.
  • Modernization of integrated hotel units belonging to or upgraded to a category of at least three (3) stars after five years from the date of commencement or from the date of completion of the previous investment.
  • Establishment, expansion or modernization of an integrated form of tourist camping (camping) belonging or upgraded to a category of at least 3 stars.
  • Establishment and modernization of integrated hotel units within designated traditional or listed buildings that belong to or are upgraded to a category of at least 2 stars.
  • Complex tourist accommodation as defined in L. 4276/2014 (A '155) except for that part relating to transfer or long-term lease of buildings and facilities. Provided that they are submitted as single investment projects under the provisions of the law.
  • Facilities of special tourist infrastructure (conference centers, golf courses, tourist ports, ski resorts, thematic parks, healing tourism facilities, sports tourism centers, mountain huts) as defined in L. 4276/2014 (A '155).
  • Agrotourism and Wine Tourism Facilities when submitted by business clusters.
  • Establishment of youth hostels under the conditions stated by the law.

 

Investment projects relating to the energy sector:

  • Small hydropower plants (up to 15 MW)
  • High efficiency cogeneration units from RES
  • Hybrid RES stations in Non-Interconnected Islands (up to 5 MW)
  • Heat and Refrigeration Production from Renewable Energy Sources.
  • Energy-efficient district heating and cooling systems.
  • Production of sustainable biofuels as well as production of existing biofuel production plants, conditional.

 

Other investment projects under the aid schemes are:αι:

  • Processing and marketing of agricultural products
  • Fisheries and aquaculture
  • Agriculture

 

Content of investment plans
Investment projects must concern:

  • creating a new unit
  • the expansion of an existing unit
  • the diversification of one unit production to new additional products
  • the fundamental change in the overall production process of an existing unit.
  • the acquisition of the closed unit asset set.

 

Aid rates and heights
The aid rate is based on the size of the enterprise and the region it belongs to and ranges from 10% to 55%.
The percentage of the investor's own contribution to the investment receiving aid in the form of a capital grant can not be less than twenty-five percent (25%) of the aided expenditure.
The minimum amount of investment in legal aid is defined, based on the size of the business, as follows:

  • For Large Enterprises, the amount of five hundred thousand euros (500,000.00).
  • For medium enterprises, cooperatives and cluster, in the amount of two hundred and fifty thousand euros (250,000.00).
  • For Small Businesses, the amount of one hundred and fifty thousand euros (150,000.00).
  • For Very Small Business, in the amount of hundred thousand euros (100,000.00).
  • For Social Cooperative Enterprises, in the amount of fifty thousand euros (50.000,00).

 

Submission of investment plans
When submitting the application for inclusion in the Investment Law, no "special" supporting documents, such as, for example, are required. building permit, environmental permits, etc.

Read more Part One: New Development Law 4399/2016