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Brexit Preparations

Dáil Éireann Debate, Tuesday - 22 October 2019

Tuesday, 22 October 2019

Ceisteanna (268)

Robert Troy

Ceist:

268. Deputy Robert Troy asked the Minister for Business, Enterprise and Innovation further to Parliamentary Question No. 305 of 15 October 2019, the exact EU state aid rules that apply to export credit insurance that members states must adhere to; the state aid thresholds that exist; and the specific EU regulations that pertain to this area. [43531/19]

Amharc ar fhreagra

Freagraí scríofa

The cover of marketable risks by export credit agencies is prohibited under State aid rules as these are risks that private insurance companies are willing to cover for countries within the EU and the majority of OECD countries. State insurers cannot be given advantage over private credit insurers. Where export credit insurance is provided by state insurers, it would involve state resources, which may give the insurers and, in turn, the exporters, a selective advantage which could distort or threaten to distort competition and could affect trade between member states. Therefore, State aid would be deemed to be present.

There are a number of existing schemes that may be accessed by exporters immediately to mitigate the impact of Brexit on their businesses. These include the Brexit Loan Scheme and Future Growth Loan Scheme.

The Brexit Loan Scheme provides affordable financing to businesses that are either currently impacted by Brexit or will be in the future. The Scheme is delivered by the Strategic Banking Corporation of Ireland (SBCI) through Bank of Ireland, Ulster Bank and AIB and makes €300 million available to eligible businesses with up to 499 employees at an interest rate of 4% or less.

Loans can be used for future working capital requirements, or to fund innovation, change or adaption of a business to mitigate the impact of Brexit.

Brexit Loan features include:

- Loan amount from €25,000 up to a maximum of €1,500,000

- Loan term of up to 3 years

- Loans less than €500,000 will be unsecured

- Interest rate of 4% or less.

The Future Growth Loan Scheme provides affordable financing to Irish businesses and the primary agriculture and seafood sectors to support strategic long-term investment in a post Brexit environment. The Scheme, which is delivered by the Strategic Banking Corporation of Ireland (SBCI) through Bank of Ireland, Ulster Bank, KBC and AIB makes €300 million available to eligible businesses with up to 249 employees at an interest rate of 4.5% or less for loans up to €249,999 and 3.5% and less for loans greater than or equal to €250,000.

Loans can be used for investment in tangible or intangible assets for the purpose of process and organisational innovation or investment in tangible and intangible assets on agricultural holdings linked to primary agricultural production.

The features of the Future Growth Loan include:

- Loan amount from €100,000 (€50,000 for primary agriculture) up to a maximum of €3,000,000

- Loan term from a minimum of 8 years to a maximum of 10 years

- Loans less than €500,000 will be unsecured

- Interest rate of 4.5% for loans up to €249,999 and 3.5% and less for loans greater than or equal to €250,000.

Enterprise Ireland and the Local Enterprise Offices also provide supports specifically to help companies to diversify their markets. These supports include the Local Enterprise Offices Technical Assistance for Micro-Exporters (TAME) Grant. This grant supports clients to explore and develop new export market opportunities. With a focus on helping companies to diversify, this scheme is a matched-funding opportunity with up to €2,500 available.

The Enterprise Ireland Market Discovery Fund incentivises companies to undertake market research and develop viable and sustainable market entry strategies in new geographic markets. The Market Discovery Fund provides support towards internal and external costs incurred when researching new markets for products and services. Support can be provided over an 18 month period from project start date to project end date. Support for Market Discovery Fund applies when eligible companies are either looking at a new geographic market for an existing product/service or an existing geographic market for a new product/service.

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