Financial support for companies, soaring energy costs… How is France supporting companies in need?
In the context of the war in Ukraine and surging energy costs, financial support has been implemented in France by decrees, published in July 2022 and September 2022, to help high energy consumers that experienced an increase in energy prices between March 2022 and December 2022. The types of energy concerned: gas and electricity.
Who is eligible?
Based on these decrees, the plan has four eligibility periods:
- March through May 2022
- June through August 2022
- September through October 2022
- November through December 2022
To be eligible, consumers must:
- Have been created before December 1, 2021, and have no energy production or financial and credit activity;
- Be a high energy-consuming company, i.e., having gas and/or electricity charges account for at least 3% of their 2021 turnover;
- Have gas and/or electricity costs double during the eligible period compared to the average price for the year 2021;
- Meet the conditions relating to EBITDA that will determine if the company can be eligible for a plan capped at 2, 25, or 50 million euros.
1st plan capped at 2m euros:
To be eligible, the company must:
- Have a negative EBITDA during the eligible period;
OR
- Have a decrease of 30% in EBITDA during the eligible 2022 period compared to the same period in 2021. However, this condition of a 30% decrease is only required for the March to May 2022 period and not for the subsequent periods, as a decrease in EBITDA is sufficient.
This assistance, limited to €2m at the group level, is equal to 30% of the “Eligible Energy Cost” for the period.
Eligible Energy Cost = Energy Consumption Volume during eligible 2022 period limited to 70% of 2021 consumption during same period * [Monthly Energy Unit Price from eligible 2022 period – Doubled Average 2021 Unit Price]
2nd plan capped at 25m euros:
To be eligible, the company must:
- Have a negative EBITDA during the eligible period
AND
- Have an increase in energy cost during the eligible period that is more than or equal to 50% of the absolute value of EBITDA.
This assistance, limited to €25m at the level of the group and 80% of the negative EBITDA, is equal to 50% of the “Eligible Energy Cost” for the period.
3rd plan capped at 50m euros:
The eligibility conditions are the same as the plan capped at 25m euros, but this plan is dedicated to activities listed in Appendix 1 of the decree. Mainly industrial and manufacturing sectors are concerned.
This assistance, which is limited to €50m at group level and 80% of the negative EBITDA, is equal to 70% of the “Eligible Energy Cost” for the period.
How to request this aid?
In our experience with the subject, this financial support is quite complex and time consuming to request.
The deadlines to file the requests are:
- March through May 2022 period – before December 31, 2022
- June through August 2022 period – before December 31, 2022
- September through October 2022 period – between November 15 and January 31, 2023
- November through December 2022 period – between January 16 and February 24, 2023
All the information and documents to complete the request are available here .
In order to file, each company must provide a(n):
- Sworn statement from the company justifying that it adheres to the eligibility conditions;
- Certificate from a chartered accountant or a legal auditor;
- Excel file of the financial support calculation;
- Excel file of EBITDA;
- 2021 and 2022 trial balances;
- All energy invoices from 2021 and from the eligible 2022 period in one document.
Please note that this fixed-cost support requires a certificate from a legal auditor or chartered accountant. Therefore, companies must anticipate the time and cost of requesting this document, as this request must be made in advance to meet the deadline.
We are carefully following this topic at Primexis and will continue to keep you updated.
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