The State Aid Fund for Business provides financial support to large and medium-sized enterprises affected by COVID-19 outbreak investing in:

  • corporate debt securities,
  • equity securities,
  • providing loans for working capital of enterprises.

The financial aid will be provided to those companies that are unable to obtain the financing they need in financial markets and are therefore experiencing serious difficulties in continuing their activities. The Fund will provide loans till the end of 2020 and will invest in equity securities till June 2021.

Investment strategy is available here.


Financial aid criteria

The applicant company shall meet the following criteria:

  • the company shall operate in the Republic of Lithuania. This means that jobs created by the company shall be in Lithuania and / or taxes shall be paid to institutions of the Republic of Lithuania;
  • the company shall be a large or a medium-sized enterprise;
  • the company shall not have been considered a company in difficulty on 31 December 2019;
  • the company has submitted its financial statements to the Centre of Registers for the last 2 years;
  • the company has not been included in the list of unreliable taxpayers;
  • without state aid, the company would face serious difficulties in continuing its activities;
  • the company cannot obtain the necessary financing in financial markets;
  • the company’s managers and / or shareholders meet reputational requirements (cannot be declared to have committed a serious, very serious or intentional crime against the economy, the financial system, etc.).

Sectors that are not eligible for the Fund measures:

  • weapons and ammunition;
  • tobacco and tobacco products;
  • manufacture of alcoholic beverages and related products (except manufacture of non-distilled alcoholic beverages), processing and specialized trade;
  • gambling and betting;
  • financial services and insurance;
  • companies, 25% or more of which are owned by the state or municipalities;

The priority shall be given to companies according to the following criteria:

  • priority shall be given to companies affected by the COVID-19 outbreak and included in the List of Affected Companies published by the State Tax Inspectorate under the Ministry of Finance of the Republic of Lithuania;
  • the importance of the company at the sector level shall be assessed, also assessing taxes paid by the company till 16 March 2020 and its payroll.

Methods of provision of the financial aid and its size

When choosing a financing instrument, a company shall assess how the provision of the aid will change the company’s financial condition and its indicators. The maximum duration of the aid is 6 years.

  • Should the financial condition and indicators of the company deteriorate significantly when financed under a debt instrument, the company should choose a share capital rather than a debt instrument.
  • If the support is needed for a longer period of time, and the company’s debt financial indicators are good enough, the recommendation is to choose aid in the form of debt securities.
  • If the company’s debt financial indicators are not good, the recommendation is to opt for aid in the form of shares and hybrid instruments that have or may have characteristics of share capital or in the form of share capital instruments (convertible bonds, mezzanine loans, preferred shares or ordinary registered shares).
Loans Debt securities Shares and hybrid instruments
EUR 300 000 to EUR 2 million Starting from EUR 1 million  

If support is needed for a short term, and the company’s debt financial indicators are sufficiently good.

Loans and bonds to one company cannot exceed 25% of its turnover in 2019.

The sum of funds for recapitalization may not exceed the difference that has formed in the company’s capital structure during the period from 31 December 2019 till the date of the decision to invest.

A subordinated loan to a large enterprise cannot exceed 8.4 % of its turnover in 2019 and to a medium-sized enterprise - 12.5% of its turnover in 2019.

Interest rates shall take into account the following:

  • the duration of the investment;
  • investment lending risk and the quality of a collateral;
  • the required Fund’s investor return;
  • the expected level of insolvency of the Fund’s portfolio investments;
  • the management fee payable to the Fund Manager (General Partner);
  • minimum requirements of the European Commission for investment interest.

How to apply?

Having decided to apply for support, the company shall complete an application (download an application form).

The application shall provide information about the company, its shareholders and managers, the need for financing, operating forecasts for several years, its financial condition in the last three financial years, etc., which shall be as detailed as possible.

The application can be submitted here.

Evaluation of applications and decision-making

Phase I. A preliminary decision on whether a company is eligible for financing

Having evaluated the company’s application, the Fund shall make a preliminary decision on the company’s eligibility for financing. Having made a preliminary favourable decision, the Fund shall determine the following:

  • the ways and the extent to which the Fund could finance the company;
  • the additional information and / or documents which the Fund may need when making a decision regarding the financing of the Applicant, including documents, the preparation of which requires the involvement of reliable partners.

Term: 5 business days

Given the fact that the Fund’s decisions must be taken as promptly and objectively as possible, when applying to the Fund with their final application, Applicants may be asked to provide an opinion, evaluation or conclusion of property appraisers, lawyers or auditors selected by the Fund and recognized as reliable partners on certain issues (i.e. due diligence). The Fund shall not reimburse or compensate the costs incurred by Applicants in cooperation with reliable partners of the Fund.

Phase II. Final decision on financing the company

The Fund shall make the final decision to finance or to refuse to finance the Applicant and, having decided to finance the Applicant, the Fund shall determine the following:

  • the ways and the extent to which the Fund agrees to finance the Applicant;
  • a timetable for financing actions;
  • the main conditions of the proposed financing, including the main provisions of agreements and other documents required for granting financing, or drafts of such documents;
  • the conditions which shall be met before granting financing or its part, or after the financing has been granted, if necessary.

Term: 5 business days*.

*If additional documents are requested, the term shall be counted from the moment of their submission.


Last updated: 28 10 2020