Enterprise Finance Guarantee (EFG) Business Sectors
The Enterprise Finance Guarantee (EFG) is subject to sector restrictions arising from the EU De Minimis Aid rules, the Industrial Development Act 1982 (which provides the statutory basis for EFG) and also for national policy reasons.
All individual decisions on the use of EFG, including application of the sector and other eligibility criteria, are made by the participating lenders based on the information provided by potential borrowers. After making the commercial decision to lend according to their own criteria, all lenders use a web portal provided by BIS to administer the eligibility criteria.Neither BIS nor Capital for Enterprise Ltd (CfEL) can advise on individual eligibility queries.
Since the start of the EFG in January 2009, and in light of changes to the De Minimis Aid Rules, certain sectoral restrictions have been lifted to ensure EFG is available to as many viable businesses as possible. These are listed below along with those sectors where certain or full restrictions remain.
Overview of Sector restrictions lifted
Authors, music composers and certain other own-account artists
- Self-employed artists, authors, composers, playwrights, musicians, actors, theatrical companies, etc, are now eligible.
- Commercial and graphic artists are eligible.
Betting and gambling
- Betting shops, totalisers, casinos, lotteries, bingo halls and amusement halls are now eligible.
Commission Agents
- Those primarily engaged in acting as intermediaries between sellers and buyers or in conducting business on another company’s behalf are now eligible, including where:
- Firms that provide a business service to a range of clients but take their fee as a proportion of the business passing through, such as shipping and export agents or employment agencies, are eligible.
- The agent merely puts the seller in contact with a buyer without buying and reselling the products themselves.
- The agent acts for a single principal or single group of companies.
Medical and health services
- All activities where registered and unregistered medical or other healthcare personnel use their skills to treat patients by the private / independent sector providers are now eligible. This includes all alternative therapies.
- Rest or convalescent homes, nursing homes and fitness and health clinics and firms offering health advice are eligible.
Owning and dealing in real estate
- Activities related to owning and dealing with real estate including those of land and estate owners, property investment companies and those that derive their income from owning and letting their own property are now eligible for EFG.
- Building firms that buy land or property to develop or refurbish and who either employ the building workers themselves or sub-contract the work are eligible.
Postal services
- The collection, transport and delivery of letters and mail-type parcels and packages by courier, parcel and messenger service are eligible.
Professional sports players and sporting organisations
- Sports instruction and sports facilities are eligible.
- Professional sports clubs are eligible.
- Organisations that involve activities to promote sport in general are now eligible.
Ticket agents
- All ticket agents including those who block book tickets are now eligible.
Tied public houses
- Public houses where a brewery or drinks supplier owns or leases the premises, gives financial support, has any control or offers any incentive to the applicant to stock their product were previously not eligible. This restriction has now been lifted and tied public houses should be treated as any other independent business.
Veterinary Services
- Veterinary professionals and practices are now eligible for EFG.
Other Sectors
The following sectors are no longer excluded from De Minimis aid and therefore are eligible for EFG:
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Automotive
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Steel
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Shipbuilders
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Synthetic fibres
Overview of eligible sectors with partial restrictions
Aid for Export, using EFG funding abroad, and the preferential use of domestic over imported goods
- Aid to export-related activities towards third countries or Member States, namely aid directly linked to the quantities exported, to the establishment and operation of a distribution network or to other current expenditure linked to export activity is ineligible for EFG.
- Aid that is contingent upon the use of domestic over imported goods is also ineligible for EFG.
- However, companies which happen to export as part of their business may be eligible for EFG.
Agriculture (including Horticulture)
1) Activities related to primary agricultural production is now eligible but the maximum eligible loan amount is in the region of €56,250 (varies according to loan term and value).
Exception:
- When the amount of aid is fixed on the basis of the price or quantity of products put on the market.
2) Loans for the processing and marketing of agricultural products (beyond simply preparation for sale and packaging) are eligible for EFG.
Exceptions:
Banking, finance and associated services
- Any activity that involves a decision on and/or granting of finance to clients, such as banks, deposit takers and building societies; companies involved in granting loans, mortgages, hire purchase or credit services; mortgage brokers that are attached to banks; venture capitalists; seed corn finance companies and stockbrokers is not eligible for EFG.
- Accountants, auditors, management service companies such as bookkeeping firms, tax advisers, management consultants, business advisers and companies that provide services to small firms on financial matters without actually supplying funds, including financial advisors and mortgage brokers, who are independent of banks and insurance companies, are eligible for EFG.
Education
- Formal education is excluded.
- Businesses offering courses that lead to vocational qualifications and skills (i.e. those skills and qualifications directly usable in a job) are eligible, as are nursery schools, day schools and playgroups for young children and sports coaching.
Forestry
- Forestry, as defined by EU guidelines, is theproduction of standing timber as well as the extraction and gathering of wild growing forest materials including products which undergo little processing, such as wood for fuel and industrial use
- Activities aimed at directly contributing to maintaining and restoring the ecological, protective and recreational function of forests, biodiversity and healthy forest ecosystem may now be eligible for EFG subject to the relevant EU guidelines.
Fisheries
Activities related to the production, processing and marketing of fisheries products is now eligible for EFG but the maximum eligible loan amount is in the region of €225,000 (varies according to loan term and value).
Exceptions – when the aid:
- Amount is fixed on the basis of price or quantity of products put on the market.
- Increases fishing capacity, expressed in terms of tonnage or power, unless it concerns aid for modernisation and improving safety standards.
- Is for the purchase or construction of fishing vessels
Insurance and associated services
- Insurance companies and any companies attached to insurance companies are not eligible for EFG.
- Insurance agents and brokers that do not provide insurance themselves and that are independent of insurance companies are eligible for EFG.
Transport
- Rail, water and air transport are now fully eligible
- Road transport sector is now eligible, but with restrictions:
- The road freight and passenger sector - is eligible but the maximum eligible loan amount is in the region of €750,000 (will vary according to loan term and value)
- The acquisition of road freight transport vehicles is excluded under De Minimis aid rules
Overview of excluded sectors
Coal
This sector is specifically excluded from the De Minimis aid rules and is therefore ineligible for EFG.
Public administration, national defence and compulsory social security
All publicly owned bodies and companies are ineligible.
