Florin Banateanu October 2011 EU funds for private sector in Romania – opportunities and practical features

Florin Banateanu

October 2011

EU funds for private sector in Romania –opportunities and practical features

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Why more opportunities in Romania?

In current economic environment, the best to use money is from non-reimbursable sources (EU funds, national budget)

What is Romania’s competitive advantage compared to other more developed EU member states?

Structural funds - about 19.2 billion euro – most of them to be absorbed between 2012-2015

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EU support to Romania: Structural Funds

Cohesion Fund (CF)• large transport + environment projects

STRUCTURAL FUNDS

European Regional Development Fund (ERDF): • infrastructure + local development • new jobs• health + education

European Social Fund (ESF)• employment + training

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What can be financed from EU funds……..

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Acquisition of tangibles: buildings,

equipment, land

Acquisition of intangibles: patents,

trade marks, know how

R&D

IT

HRHRAccessing new markets

Standardization


…and what cannot be financed from EU Funds

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Shipbuilding

Coal and steel industry

Fiber industry

Export

Alcoholic beverages

Banking and financial activities

Guns and ammunitionsTobacco


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SOP Increasing Economic Competitiveness, priority axes:

1 – Productive investments, consisting in tangibles and intangibles (maximum

grant: 5 mil Euro - large enterprises; 1,5 mil Euro - SMEs)

2 – R&D (maximum grant: 9,5 mil Euro – partnerships universities / research

institutes / enterprises)

3 – IT Development (for SMEs; maximum grant : 1,5 ml Euro)

4 – Increasing energy efficiency and security of supply (enterprises, utility

operators; maximum grant: 20 ml Euro)

Available budget: ~ 724 ml Euro

Financing sources of interest for private sector - EU Funds


Financing sources of interest for private sector - EU Funds (cont)

SOP HR Development – Key Areas of Intervention (KAI):

KAI 1.2 – Quality in higher education

KAI 2.2 – Preventing and correcting early school leaving

KAI 2.3 – Vocational training

KAI 6.4 – Transnational initiatives on inclusive labor market

Maximum grant : 500.000 Euro (individual projects), 5 mil Euro (strategic projects)

Eligible beneficiaries: all types of companies

Only trainers authorized by Romanian authorities (CNFPA) may be used


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All the above KAIs will be launched in October – November 2011


Financing sources of interest for private sector - EU Funds (cont)

Regional Operational Programme:

KAI 4.1 – Development of sustainable business support structures of regional and

local importance (max. grant ~ 400.000 – 20.000.000 Euro )

KAI 4.3 – Support the development of micro-enterprises (max. grant ~ 24.000 –

700.000 Euro)

KAI 5.2 – Creation, development, modernization of the tourism infrastructure for

sustainable valorization of natural resources and for increasing the quality of

tourism services (max. grant ~ 170.000 – 20.000.000 Euro)


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• KAI 4.1 – open call only for South and N –E Regions• KAI 4.3 – For the moment this call is suspended – should be re-launched soon• KAI 5.2 – open call only for S –E Region


EU grants: basic conditions

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Maximum 3 years to spend the funds

Public procurement mandatory (i.e. at least a comparison of offers) for any acquisition

Goods purchased: new only

General level of support:- Up to 40% in Bucharest &Ilfov county- Up to 50% in the rest of the territory


EU grants: general requirements

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Eligible Project

• implemented on Romania’s territory • includes eligible activities • activities not financed from other public funds• duration according to requirements• clear & measurable results

Eligible applicant

• Romanian company; • eligible scope of activity • eligible size and type of company• no outstanding liabilities to State / local budget • not bankrupt or under liquidation • registered profit at end of year prior to application.


Financing sources of interest for private sector - National Funds

State Aid Schemes for promoting regional investments (GD 1680/2008 and GD 753/2008) grants up to 50% of the total investment cost:

•Investments of 5-10 mil Euro conditioned to generate at least 50 new jobs

•Investments of 10-20 mil Euro conditioned to generate at least100 new jobs

• Investments of 20-30 mil Euro conditioned to generate at least 200 new jobs

• Investments over 30 mil Euro conditioned to generate at least 300 new jobs

Maximum grant amount for this situation is limited to 28 mil Euro

• Investments over 100 mil Euro conditioned to generate at least 500 new jobs

For investments over 50 mil Euro, EC approval is mandatory

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What KPMG Advisory Department can do to assist you

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Analysis Analysis Advice on potential financing opportunities

Advice on potential financing opportunities

Preparation of application filePreparation of application file

Advice during the application processAdvice during the application process

Assistance in project implementation

Assistance in project implementation

Phase 1Phase 1 Phase 2Phase 2

we identify and evaluate project ideas and line them up with corresponding national and local financing programs

we identify the available financing instruments, based on project ideas;

we prepare the report on all potential financing opportunities corresponding to the needs of the client

we assist in preparing the application dossier and the required accompanying documentation (business plan, cost/benefit analysis etc.)

we monitor the application evaluation process

we assist in answering the clarification requests from the Management Authority

project implementation, i.e.:

oAssist in preparing the reimbursement applications

oPublic procurement

© 2011 KPMG Romania S.R.L., a Romanian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Romania.

The KPMG name, logo and ‘cutting through complexity’ are registered trademarks or trademarks of KPMG International Cooperative (KPMG International).

Thank you!

Florin BFlorin Băănnăţeăţeanu anu Director, Public Sector Advisory ServicesDirector, Public Sector Advisory Services

[email protected]@kpmg.com

Daniela NemoianuDaniela NemoianuExecutive Partner, Advisory ServicesExecutive Partner, Advisory Services

[email protected]@kpmg.com

www.kpmg.rowww.kpmg.ro

Documents

Florin Banateanu October 2011 EU funds for private sector in Romania – opportunities and practical features