The extension of the nationwide 6 p.m. curfew has been accompanied by a series of new measures to support businesses, announced on January 14 by French Finance Minister Bruno Le Maire. Here's a closer look at the government's measures to support small and medium-sized businesses during the health crisis.
70% of fixed costs for large SMEs covered
Businesses under administrative closure or in serious difficulty, belonging to the hotel-restaurant, tourism or sports hall sectors, with sales of over €1 million per month, will benefit from a subsidy of up to 70% of their fixed costs. This aid is in place for the entire 1st half of 2021, up to a maximum of 3 million euros.
"We're going to work with members of parliament on the best ways of lowering this 1 million euro threshold, which I know can be penalizing for a number of very specific small structures," said Bruno Le Maire. This aid will be added to the solidarity fund, and is intended to supplement the monthly aid of 10,000 euros, deemed insufficient for large structures.
The 3 million euro ceiling is the result of negotiations with the European Commission. " We will continue to negotiate with the European Commission to see if we can raise the ceiling further," said Bruno Le Maire.
Strengthening the solidarity fund
Companies in sector S1 bis, such as those operating in international tourist zones or in the passenger transport sector, which are not administratively closed but indirectly suffer the consequences of closures, will see an increase in the amount of the solidarity fund.
Thus, if they lose at least 70% of their sales, they can receivecompensation representing 20% of their 2019 sales, up to a maximum of 200,000 euros per month. This amount was previously limited to 10,000 euros per month, which was insufficient for larger structures.
Furthermore, sales generated by distance selling and/or takeaways will not be included in the calculation of the solidarity fund, as long as the fund is in place.
Finally, winegrowers affected by US customs sanctions will receive special support. They will be able to benefit from the solidarity fund in the following ways:
- Winegrowers who have lost 50% of their sales will be compensated for 15% of their 2019 sales, up to a maximum of 200,000 euros per month;
- Winegrowers who have lost 70% of their sales will be compensated for 20% of their 2019 sales, up to a maximum of 200,000 euros per month.
Extended repayment terms
All companies wishing to do so, whatever their sector of activity and whatever their size, will be able to benefit from an additional one-year deferral to start repaying their state-guaranteed loan. EMPs taken out in 2020 will therefore, if necessary, not be repaid until 2022. The postponement will not be automatic, however, but will require an appointment with one's bank advisor, who should then give his agreement as agreed between Bercy and the French Banking Federation. In total, over 638,000 PGEs have been subscribed, for a total of 130 billion euros.
Furthermore, with regard to loans granted prior to the health crisis, "banks will examine favorably and on a personalized basis any moratoria or deferrals of due dates required by companies still suffering from business restrictions", declared Bruno Le Maire.
In 2020, it will also be possible to defer depreciation of assets that are seldom used, such as nightclub equipment or, for example, restaurant ovens.
Finally, the partial-activity scheme remains in place for companies that are totally or partially closed, such as shops with a 6 p.m. curfew. Companies in the protected sectors will continue to benefit from the State's full reimbursement of wages paid to employees until the end of February.
This 100% coverage will subsequently be maintained for companies with an 80% drop in sales, while the remainder will have to pay 15%.