Funded circular economy investments aim at significant positive environmental impacts by increasing material circulation and promoting business and employment growth in different sectors, both in Finland and internationally. A company applying for an investment grant may also be a company operating only on the Finnish market. However, the application must describe how the investment will affect the investor's business operations and how many jobs it will provide, as well as the indirect impact that the investment may have on other businesses.

We fund companies of all sizes registered in Finland that operate in mainland Finland and have the financial capacity to cover the investment's self-financing share and continuous profitable operations.

Yes. All companies registered and operating in Finland may apply, regardless of age, size and ownership base.

No. The investment grant is intended for circular economy investments in mainland Finland.

Yes.

Joint ventures may be financed at the discretion of Business Finland. For joint projects, all beneficiaries must commit to the full implementation of the project. In other words, they cannot be only service-providing parties to the project. In the joint project, the parties must have a joint project plan in which each party's share of the project and costs is described. Public procurement legislation cannot be circumvented by joint projects. All parties to the joint project must participate in the management of the project and in the coordination of activities, unless they have chosen from amongst themselves a body for carrying out these activities. Each party submits its own parallel application to Business Finland and is responsible to the grantor for all activities carried out in the project. Prior to the start of the project, the parties must enter into a mutual agreement in accordance with Article 7(3) of the Act on Discretionary Government Transfers. In the agreement, the parties must, amongst other conditions, agree on the implementation of the project and the roles of the various parties involved in the implementation of the project, financial contributions and the internal and external flow of information and notifications regarding the project. If the project is subject to a claim for recovery, all parties to the project are responsible for this.

No.

Business Finland’s circular economy funding is intended for innovative circular economy investments that:

• increase the level of environmental protection beyond European Union standards or
• increase waste recycling through a solution that goes beyond the latest level of technological development in the sector.

The application for funding must set out the solution that exceeds the standards; and what would be a solution with equivalent capacity in line with EU standards or the level of technological development of the sector.

The circular economy grant of the Ministry of Economic Affairs and Employment is suitable for situations where a company needs support to establish the conditions for its circular economy investment or other research and investigation related to circular economy. The ministry’s circular economy grant can be used to develop investments in Finland or for smaller circular economy investments. The application for funding must include an adequate impact assessment of the project’s innovation, employability, and contribution to the development of circular economy. The application for funding does not require a comprehensive explanation of the exceeding of the level of environmental protection or of the state of technical development of the sector.

The grant from the Ministry of Economic Affairs and Employment is de minimis aid, and the maximum permissible sum of the de minimis aid to a company is 200,000 euros over the current and two previous fiscal years. Business Finland's circular economy investment grant is not considered de minimis aid.

The applicant's financial situation is examined on the basis of its latest confirmed financial statements and other relevant financial information. If the latest financial statements have not been submitted to the Finnish Patent and Registration Office, it must be submitted to Business Finland.

Business Finland will also use the obligation management report from the Finnish Tax Administration and the Rating Alfa information received from Suomen Asiakastieto Oy to assess the company's financial situation.

The circular economy investment grant is not intended for companies that were in difficulty as defined by the European Union on 31 December 2019. However, with the amendment to this EU regulation made at the start of July 2020, businesses that have come into difficulty between 1 January and 30 June 2021 will be able to apply for investment grants. Business Finland considers the overall application in the assessment, and evaluates how the company's overall financial situation affects the conditions for profitable business operations.

Business Finland uses the European Commission's definition of an undertaking in difficulty. An undertaking firm in difficulty is one that:

1. is in bankruptcy or reorganization proceedings, or
2. has received rescue or structural change support and has not yet paid it back, or
3. has lost more than half of its subscribed share capital due to accumulated losses, or
4. exceeds or falls below certain thresholds (book debt to equity ratio and EBITDA interest coverage ratio)

If the company is less than 3 years old SME, it is considered to be in difficulty based on points 1-2 alone. For SMEs over 3 years of age, points 1-3 are assessed. For large companies, all points 1-4 are evaluated. According to point 4 a large enterprise will be considered a firm in difficulty if, for the last two years:

1. It's book debt to equity ratio has been greater than 7,5 and
2. It's EBITDA interest coverage ratio has been below 1,0.

If the company was an undertaking in difficulty according to its most recently adopted financial statements but the situation has since been rectified, the company may prove that its circumstances have improved by providing an auditor's statement to this effect. The statement must show that the company is not an undertaking in difficulty based on the criteria presented above.

If the company has a tax debt, it can be granted funding if the company has a payment arrangement with the Finnish Tax Administration for the service of tax debts. Funding may not be granted to an organization that has neglected reporting or to an organization not included in the prepayment register.

The funding will be given as a grant, the amount of which will be determined case-specifically on the basis of comparative calculations from the customer, unless additional costs of a solution that exceeds EU standards or the level of technical development of the sector can be identified separately from the total investment costs.

Maximum aid levels for additional investment costs are 45% for small and medium enterprises and 35% for large enterprises (including midcap enterprises). The maximum amount of an individual grant  may not exceed EUR 15 million per company and per project.

The applicant must be able to demonstrate to Business Finland that it has sufficient overall funding for the project period. As Business Finland funding is usually paid retrospectively, the recipient must therefore be able to pay the costs of the project themselves first.

The funding is intended for innovative circular economy investments that improve the level of environmental protection beyond European Union standards or increase waste recycling through a solution that goes beyond the latest level of technological development in the sector.

Funded circular economy investments aim at significant positive environmental impacts by increasing material circulation and promoting business and employment growth in different sectors, both in Finland and internationally. In order for an investment to be eligible for funding, it must directly contribute to increased recycling or to exceeding environmental standards.

The funding may be granted to investments related to industrial construction, investments to improve the circular economy of business ecosystems, investments in the construction of digital solutions or investments in the recycling and reuse of waste.

The key goal in the circular economy is to keep products, materials and their value in the economic cycle for as long as possible. Efficiency is improved and value increases when materials and products are designed and manufactured for long-lasting use and reuse, and can be combined with services. The purpose of the circular economy is to change conventional operating and production practices and to provide opportunities for companies adapting to change and investing in a new way of operating. Green growth may consist of a completely new type of business and create new businesses, but there are also opportunities in conventional energy-intensive and resource-intensive industries. Companies play a key role in growth, but green growth also requires changes in consumption in addition to production. Central government, regional government and local government act as enablers, creating conditions for green growth.

For the purposes of the definitions provided in the European Union General Block Exemption Regulation (GBER), 'environmental protection' means any measures aimed at remedying or preventing harm to the physical environment or natural resources caused by the beneficiary's own operations, reducing the risk of such harm, or promoting the rational use of natural resources.

A business ecosystem is a network in which private and public actors collaborate and create complementary services or products or develop production resources.

In the definitions provided in the GBER, 'latest developments in the sector' refer to processes where the reuse of a waste product in the manufacture of the finished product is an economically viable and normal practice. The term 'latest developments in the sector' will be considered, where appropriate, from the point of view of the union's technology and internal market.

For the purposes of the definitions provided in the European Union General Block Exemption Regulation (GBER), 'EU standards' refer to

(a) A mandatory EU standard establishing the level of environmental protection to be achieved by individual undertakings; or

(b) The obligation to use the best available technology (BAT) in accordance with Directive 2010/75/EU (1) of the European Parliament and of the European Council, and to ensure that pollutant emission levels are not higher than they would be when using BAT;

• Where emissions levels related to BAT are defined in implementing acts adopted under Directive 2010/75/EU, those levels will apply for the purposes of this regulation
• If these levels are indicated as a range, the level at which the requirement for BAT is first achieved will apply.

For the purposes of the definitions in the GBER, 'recycling' refers to a recovery business in which waste materials are reprocessed as products, materials or substances, either for the original purpose or for other purposes. It includes the reprocessing of organic matter, but does not include either energy recovery or reprocessing into materials used as fuels or for earth-filling operations.

For the purposes of the definitions in the GBER, 'reuse' refers to measures for allowing products or parts that are not waste to be reused for the same purpose for which they were designed.

The funding is based on the Act on Discretionary Government Transfers (688/2001), the act on general conditions for support for economic activities (429/2016) and the government decree on grants to enterprises to promote the circular economy and sustainable green growth (1197/2020).

The aid scheme for investments in the circular economy is based on Articles 36 and 47 of the GBER (European Commission regulation concerning the provision of certain forms of aid compatible with the internal market in accordance with Articles 107 and 108 of the EU treaty 651/2014 (OJ L 187, 26 June 2014, p.1).

For aid granted under Article 36 of the GBER, it must be made possible that the beneficiary can

• Improve the environmental performance of its activities by exceeding applicable EU standards, whether or not there are binding national standards in force that are more stringent than the EU standards, or
• Improve the environmental performance of its activities in the absence of EU standards.

No aid will be granted in cases where investments are made to ensure that undertakings comply with EU standards that have already been adopted but which have not yet entered into force. By way of derogation from the previous criterion, aid may be granted for

(a) The purchase of new transport equipment for road, rail, inland waterway and maritime transport in accordance with approved EU standards, provided that the purchase is carried out before the entry into force of the standards in question and they are not applied after they have become mandatory to vehicles purchased before the date in question;

(b) Retrofitting existing means of transport for road, rail, inland waterway and maritime transport, provided that EU standards were not yet in force on the date of entry into service of those means of transport and they are not applied retroactively to the vehicles in question after they have become mandatory.

Eligible costs are only the additional investment costs necessary to exceed the applicable EU standards or to improve the level of environmental protection in the absence of EU standards. Costs not directly linked to the achievement of a higher level of environmental protection are not eligible.

Investments supported under Article 47 of the GBER must enable the latest level of technological development in the sector to be exceeded.

The aid is intended for the recycling and reuse of waste produced by operators other than the beneficiary. Therefore, investments related to the recycling and reuse of the beneficiary's own waste cannot be supported under this article.

Otherwise, recycled or reused materials would be disposed of or used in a less environmentally friendly manner. The article is not applicable to waste recovery operations other than recycling aid.

Eligible costs are only the additional investment costs incurred in carrying out an investment leading to better or more efficient recycling or reuse operations compared to a conventional reuse and recycling process with equivalent capacity that would be created without aid.

The investment must not merely increase demand for recyclable materials without increasing material collection.

The aid must not indirectly relieve polluters of the costs they should bear under EU law or of costs that should be considered normal business operating costs.

No. The grant is intended for investment projects. Feasibility studies and other studies are not acceptable costs under the GBER. However, in connection with investments, the financing may be used to finance the implementation planning of the investment in accordance with the GBER.

Service purchases made from group and interest companies can be approved without cover. In order to establish lack of cover, the group and interest company organizes project accounting and time monitoring in accordance with the financing terms and conditions and settles their costs of the project using forms obtained from Business Finland.

Salaries paid under effective working time from persons involved in the project and subject to withholding tax are eligible costs. As a rule, executive and administrative salaries are general expenses, but when the work performed directly relates to the development activities defined for the project, salary costs can also be accepted as project costs. General expenses are not eligible costs for investment projects.

In circular economy investment projects, the sender of the application must have the right to conclude agreements on behalf of the company. This is different from Business Finland's other funding services.

If the autograph clause does not allow for exclusive representation, the application must be accompanied by a power of attorney signed by the persons entitled to sign the application.

A separate project plan (see separate project plan guide) is required as an appendix to the application, which describes various factors in more detail, such as the following:

1. Objectives, implementation, resources, timetable, costs and funding
2. Calculations of both the cost of the investment to be applied for and the cost of a comparable investment in accordance with EU standards or in line with the level of technical development of the sector for the purpose of determining the eligible part and the amount of aid, unless the costs of the additional, eligible part of the total investment can be identified; and
3. Profitability calculations for both the investment applied for (without aid and with the aid) and comparable investment in line with EU standards or the level of technical development of the sector in order to assess the necessity of the aid.

The application can be supplemented through the online services once it has been entered in Business Finland's system. Additional information should not be sent by email. We will contact the applicant if we need more information to process the application.

The application can be withdrawn before a decision has been made by sending an email to Business Finland's registry office at kirjaamo@businessfinland.fi. In the subject line of the message, write "Application withdrawal xxxx/31/2020" and the name of the applicant organization. (xxxx/31/2020=document number). In the message field, state briefly: We are withdrawing our application. Best regards, N.N.

The aim is to process applications during May and June. Applications differ, and some require more research before a decision can be made. We will make every effort to ensure that applicants receive funding decisions quickly.

It is essential that the grant is applied for from Business Finland before the project is started.

The acquisition of fixed assets, the start of construction, modification or improvement work financed by the aid and the conclusion of a binding investment decision will be considered commencement of the investment project. For the purposes of the GBER, 'commencement of work' means either the commencement of investment-related construction work or the first legally binding commitment to order equipment or any other commitment that makes the investment irreversible, depending on whichever occurs earlier. The purchase of land and preparatory work such as obtaining permits and carrying out feasibility studies will not be considered as commencement of the work.