Covid-19 Credit Guarantee Scheme 2020.

JurisdictionIreland
CitationIR SI 325/2020

Notice of the making of this Statutory Instrument was published in

“Iris Oifigiúil” of 1st September, 2020.

ARRANGEMENT OF SCHEME

TABLE OF CONTENTS

PART 1

PRELIMINARY AND GENERAL

1. Citation

2. Interpretation and Definitions

PART 2

OVERVIEW OF THE CREDIT GUARANTEE SCHEME

3. Objective and Application of the Credit Guarantee Scheme

4. Powers of Minister

5. Guarantee and Facility Term

6. Financial Product Values

7. Eligible Credit

8. Premium Charge

9. Pricing Discount

10. Temporary Framework

11. Data Protection

PART 3

APPROVAL OF FINANCE PROVIDERS TO THIS SCHEME

12. Participating Finance Provider’s Legal Agreement

13. Review Process

14. Recommendation by Operator

I, Leo Varadkar, Minister for Business, Enterprise and Innovation, in exercise of the powers conferred on me by section 5 of the Credit Guarantee Act 2012 (No. 26 of 2012) (as amended by the Credit Guarantee (Amendment) Acts 2016 and 2020 (No. 1 of 2016 and No. 5 of 2020)) (as adapted by the Jobs, Enterprise and Innovation (Alteration of Name of Department and Title of Minister) Order 2017 (S.I. No. 364 of 2017)) with the consent of the Minister for Finance and of the Minister for Public Expenditure and Reform, hereby make the following Scheme:

PART 1 – Preliminary and General

1. Citation

This Scheme may be cited as the Covid-19 Credit Guarantee Scheme 2020.

2. Interpretation and Definitions

In this Scheme:

“2012 Act” means the Credit Guarantee Act 2012 ;

“all sums due security” means, with respect to a participating enterprise and a participating finance provider, a security interest that secures payment of any and all amounts due from time to time by that participating enterprise to that participating finance provider;

“Co-Operation Agreement” means the agreement to be entered into between (1) the Minister for Business, Enterprise and Innovation and (2) the Strategic Banking Corporation of Ireland, to be made pursuant to section 7 of the 2012 Act, in relation to the operation of this Scheme and, as applicable, any subsequent agreement into which the Minister enters for this purpose;

“Commission Decision” means the decision of the European Commission in respect of state aid measures notified by the State to the European Commission under the Temporary Framework in respect of this Scheme;

“data protection law” means the GDPR, the Data Protection Acts 1988 to 2018, the ePrivacy Directive (as amended), the European Communities (Electronic Communications Networks and Services) (Privacy and Electronic Communications) Regulations 2011 ( S.I. No. 336 of 2011 ), and any other applicable laws relating to data privacy and any relevant transposition of, or successor or replacement to, those laws (including, when it comes into force, the successor to the ePrivacy Directive);

“ePrivacy Directive” means Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector (Directive on privacy and electronic communications);

“finance agreement” has the meaning ascribed to it in the 2012 Act;

“finance provider” has the meaning ascribed to it in the 2012 Act;

“financial product” has the meaning ascribed to it in the 2012 Act;

“GDPR” means Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC;

“invoice finance facility agreement” has the meaning ascribed to it in the 2012 Act;

“negative recommendation” has the meaning ascribed to it in section 14(1)(b);

“Operator” means the Strategic Banking Corporation of Ireland, a private company limited by shares established pursuant to the Strategic Banking Corporation of Ireland Act 2014 and incorporated with registered number 549539, being the entity appointed for the time being by the Minister pursuant to the Co-Operation Agreement to, inter alia, perform the functions of the Operator under this Scheme, or such other entity as may be appointed by the Minister for such purpose pursuant to section 7 of the 2012 Act from time to time;

“operating model” means the written manual, which the Operator shall put in place, setting out the operating model by which this Scheme shall operate as between the Operator and the participating finance providers and which shall be provided to each participating finance provider;

“participating enterprise” means a qualifying enterprise that has entered into a qualifying finance agreement with a participating finance provider;

“participating finance provider” shall be construed in accordance with section 2 of the 2012 Act, provided that, for this purpose, references to “a credit guarantee scheme” in sections 2(3)(a) and 2(4) of the 2012 Act shall instead be deemed to be references to this Scheme;

“participating finance provider’s legal agreement” has the meaning ascribed to it in section 4(2);

“personal data” has the meaning given to that term in data protection law;

“positive recommendation” has the meaning ascribed to it in section 14(1)(a);

“premium” has the meaning ascribed to it in section 8(1);

“qualifying enterprise” shall be construed in accordance with section 3(1A) of the 2012 Act;

“qualifying finance agreement” has the meaning ascribed to it in the 2012 Act, provided that, in the definition of this term in section 1 of the 2012 Act, references to “a credit guarantee scheme” shall instead be deemed to be references to this Scheme;

“quantum recommendation” has the meaning ascribed to it in section 14(2); and

“Temporary Framework” means Communication C(2020)18631 of the European Commission entitled “Temporary Framework for state aid measures to support the economy in the current COVID-19 outbreak”, as adopted by the European Commission on 19 March 2020 and as amended on 3 April 2020 (C(2020) 2215)2 , 8 May 2020 (C(2020) 3156)3 and 29 June 2020 (C(2020) 4509)4 and as may be further amended from time to time.

PART 2 - Overview of the Credit Guarantee Scheme

3. Objective and Application of the Credit Guarantee Scheme

(1) The principal objective of this Scheme is to facilitate the provision of financial products to participating enterprises in response to the economic difficulties caused by Covid-19 in a manner that complies with the Commission Decision.

(2) Subject as herein provided, this Scheme applies to all classes of qualifying finance enterprise, finance provider, financial product and finance agreement permissible under the Credit Guarantee Acts 2012 to 2020.

4. Powers of Minister

(1) Under this Scheme, the Minister may, subject to the conditions specified in section 4(3) and any additional conditions imposed by the Credit Guarantee Acts 2012 to 2020, guarantee the obligations of one or more participating enterprises under one or more qualifying finance agreements in favour of the corresponding participating finance providers.

(2) Any guarantee given under section 4(1) shall be documented in a written agreement to be made between the Minister and the corresponding participating finance provider (in this Scheme referred to as a “participating finance provider’s legal agreement”).

(3) In addition to the limitation imposed by section 4(2) of the 2012 Act on any guarantee given under section 4(1), the Minister shall not be liable under a guarantee given under section 4(1) in respect of any amount advanced to or paid to or for the benefit of a participating enterprise pursuant to a qualifying finance agreement entered into between a participating finance provider and the corresponding participating enterprise after 31 December 2020, or such later date as the Minister may appoint by order made under section 4A(1)(a)(ii) of the 2012 Act.

5. Guarantee and Facility Term

(1) As required by section 4A(1)(a) the 2012 Act, any guarantee given under section 4(1) shall be entered into by the Minister on or before 31 December 2020 or such later date as the Minister may appoint by order made under section 4A(1)(a)(ii) of the 2012 Act.

(2) As required by section 4A(1)(b) the 2012 Act, no guarantee given under section 4(1) may exceed a maximum duration of six years from the date that the corresponding participating finance provider’s legal agreement is entered into.

(3) A qualifying finance agreement may be entered into by a participating finance provider for whatever term is deemed appropriate by that participating finance provider provided that a qualifying finance agreement shall not be for a term that is less than three months nor more than six years.

6. Financial Product Values

(1) The credit amount in respect of each qualifying finance agreement which benefits from a guarantee given under section 4(1) shall be within the applicable limit specified in the Commission Decision and shall be:

(a) at least €10,000 (ten thousand euro), and

(b) not greater than €1,000,000 (one million euro).

(2) Qualifying enterprises may apply for more than one qualifying finance agreement during the duration of this Scheme provided that the aggregate credit amounts pursuant to the qualifying finance agreement or qualifying finance agreements which that qualifying enterprise and/or any related company of that qualifying enterprise (within the meaning of the Companies Act 2014 ) has or have entered into and which benefit from a guarantee given under section 4(1), do not exceed, in aggregate, the maximum credit amount that may be advanced under a qualifying finance agreement pursuant to section 6(1).

7. Eligible Credit

(1) Subject to subsection (2), any guarantee given under section 4(1) may only be granted in respect of:

(a) in the case of a qualifying finance agreement providing for a credit amount not greater than €250,000...

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