Under EU state aid rules, a company is in difficulty if at least one of the following five conditions is met:

1. It is a limited liability company that has lost more than half of its subscribed share capital due to accumulated losses.
2. It is a general partnership or a limited partnership (or any other company in which the liability of at least some of the shareholders for the company's debt is not limited) and which has lost more than half of its own funds according to the accounts as a result of accumulated losses, or it fulfils the conditions laid down by national law for filing for bankruptcy or business restructuring proceedings at the request of creditors.
3. The company has been placed in bankruptcy or business restructuring proceedings due to insolvency.
4. The company has received a so-called rescue aid and has not yet repaid it, or has received restructuring aid and is the subject of a restructuring plan.
5. In addition to the conditions set out above, large companies are also considered to be in difficulty in cases where, based on the two previous approved annual financial statements, both of the following conditions are met: the company's gearing has been above 7.5 and the company's EBITDA to net financial expenses ratio has been below 1.0.

If the company is less than 3 years old, the company is considered to be in difficulty only on the basis of section 3.

The difficulties of companies belonging to the group are examined from the perspective of the entity formed by Business Finland's client company and units under the same control. If the consolidated financial statements are not available, Business Finland will ensure that the prohibition on granting support to companies in difficulty is complied with in these cases as well.

Business Finland audits the company's equity at the time of the financing decision, also in the middle of the financial year. Even if the company was not in difficulty according to the previous financial statements, the equity situation is reviewed for the current financial year. 

Memorandum of the Ministry of Economic Affairs and Employment: Restrictions and definition of support for a company in difficulty in EU state aid rules.