France – Simplification and extended deadline for energy-intensive businesses to apply for a subsidy
Your company may receive a subsidy from the Government if it is losing money because of soaring gas and electricity price.
CALCULATION OF THE AMOUNT OF THE SUBSIDY
Depending on its situation, the amount of financial support that your business may get is as follows. This aid corresponds to a percentage of the eligible costs:
30 % of eligible expenses
If your company’s earnings before taxes, depreciation, and amortization (EBITDA) is down in 2022 compared to 2021, or it experienced an operating loss in 2022 compared to 2021. You may receive up to EUR2 million.
50 % of eligible expenses
If your company’s EBITDA is negative and its operating loss does not exceed twice the eligible expenses. The maximum amount of the subsidy is 80% of the amount of the losses. This aid can be up to EUR25 million.
70 % of eligible expenses
Capped at EUR50 million, this aid can be granted if your company meets the following requirements:
- Its EBITDA is negative, and its operating loss does not exceed twice the eligible expenses.
- It is operating in one of the most competitive industries worldwide as referenced in a list that the Government maintains. These industries and sub industries include the leather clothing manufacturing industry, the aluminum manufacturing industry, the steel industry, etc.
Note: the amount of the subsidy is capped at 80% of the losses.
If your company is part of a group of companies, the amount of the financial support is based on the Group’s consolidated financial information.
BUSINESSES THATE ARE ELIGIBLE FOR THE FINANCIAL SUPPORT
To qualify for financial assistance from the Government, your business must meet the following requirements:
- Be formed or incorporated before December 1st, 2021.
- Be a resident of France for income tax purposes.
- Have as main activity an activity other than the production of electricity or heat, banking.
- Be an energy-intensive business. For this purpose, your company’s gas / electricity purchases in 2021 taxes included but deductible VAT excluded must represent at least 3% of your sales.
- Must have experienced a 100% increase of the gas and/or electricity price during the eligible period compared to a 2021 average price.
- To not be in bankruptcy filing proceedings, legal redress, or judicial liquidation.
- To not have any payroll tax or income tax liabilities balance due as of December 31, 2021. The followings are not tax debt due: tax liabilities that you paid while you were in the process of filing your application for subsidy or that you are paying by installment as part of a payment plan agreement.
- To not be formed or incorporated in the French Overseas territories (COM). This Government measure is not applicable in the COM.
To make it easier for your company to qualify for the financial support, you’re allowed to determine the decrease of your EBITDA or the negative EBITDA month by month or quarter by quarter in the eligible period.
If your company is eligible, the Government will accept corrected electricity and gas bills that you may receive later and that were not known to you when you were filing your application for financial support.
APPLICATION DEADLINE
You may apply for financial support by logging into your professional taxpayer account. The following is the due dates to apply for financial support for your business:
- Décembre 31, 2022 : March to August 2022 eligible period
For the September to December 2022 eligible period, the filing dates will be communicated later.
Soaring electricity and gas prices has been the first consequences of the war in Ukraine. They have already significantly increased in 2021. For example, on March 7 2022 electricity and gas prices were as follows:
> Gas: EUR224.6/MWh compared to EUR46/MWh in 2021.
> Electricity: EUR540/MWh compared to EUR109/MWh in 2021.
The energy price spike has heavily impacted energy-intensive industries and businesses. They include businesses that are in a highly competitive global market and highly competitive industries.
As part of its economic and social resilience initiative, the Government set up the “gas/electricity financial support known as Aide Energo”. The goal is to support financially energy-intensive businesses that have been severely impacted by the energy price spike.