Processing plant grant: terms and co-financing

This is the largest grant by amount for manufacturing businesses within the eRobota programme. It is governed by a separate Cabinet of Ministers Resolution No. 739 of 24 June 2022. Micro, small and medium-sized enterprises and sole proprietors operating in Section C (Manufacturing) of the national classification of economic activities may apply, except state-owned and municipal ones.

Amount and co-financing share

One recipient can obtain up to UAH 8 million. For those replacing fixed assets destroyed or damaged by the aggression the ceiling is higher, up to UAH 16 million, but no more than the damage sustained.

The grant always requires co-financing. The state share depends on the project:

• up to 50 per cent – the base rule for most applicants;
• up to 70 per cent – if you buy fixed assets whose country of origin, per the certificate, is Ukraine;
• up to 80 per cent – for territories of possible or active hostilities, for makers of unmanned aerial vehicles and their parts, for printing, and for restoring destroyed capacity.

The applicant’s share can be met from own or borrowed funds, but there is a limit: the own, non-borrowed contribution must be at least 20 per cent of the project cost. Financing your whole half with a loan is not possible.

What the money is for

• purchase of production fixed assets: machinery, equipment, power tools;
• their delivery and commissioning, including software;
• intangible assets and applied development to bring an innovative product into serial production;
• post-harvest handling equipment – for perennial crop growers registered in the State Agrarian Register.

Construction, raw materials and wages are not covered. The equipment cannot be disposed of until the agreement is fulfilled. If it is second-hand, a valuation by a certified valuer is mandatory.

Recipient’s obligations

The grant agreement has two mandatory conditions. The first is to pay taxes, duties and the unified social contribution equal to the grant received within three years. The second is to create at least five full-time jobs and pay unified social contribution for those employees of at least 20 per cent of the grant amount. If an employee leaves, a replacement is hired within a month. On a shortfall the difference is repaid, and if the business is liquidated the grant is repaid in full.

How selection works

The application with a business plan is filed through Diia, with an authorised bank chosen. These are banks in which the state holds more than 50 per cent of the shares. The bank checks the applicant, assesses the business plan and holds a video-recorded interview. To get the grant you need more than 25 points under criteria approved by an order of the Ministry of Economy. The Ministry of Economy and the State Employment Centre decide within 20 working days of the closing date. There are several closing dates a year, and a funding cap can be set for each.

After the decision you have 10 working days to open a bank account and pay in your share. The grant arrives only after that.

Typical grounds for refusal

• Incorrect calculations in the business plan or discrepancies between the application, the plan and the documents.
• Equipment is to be bought from a related party or a company that was related within the past 12 months.
• The premises do not match the declared activity.
• The bank cannot confirm the lawful origin of the own contribution.
• No certificate of origin where 70 per cent is claimed for Ukrainian equipment.
• The applicant declined the interview or its video recording.

If your own share falls short, part of it can be borrowed under Affordable Loans 5-7-9%, where manufacturing is a priority area. How to weigh the two instruments is explained in Grant or subsidised loan.