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Public Competition for Support Instrument: Co-financed grants for start-ups and spin-off companies – STARTUP 3!

DATE

September 8, 2021

Categories

Pursuant to Article 25 paragraph 4 of the Law on Innovation Activity (“Official Gazette of the Republic of Macedonia” No. 79/13, 137/13, 41/14, 44/15, 6/16, 53/16, 190/16 and 64/18) and the Rulebook on the support instrument – co-financed grants for newly established start-up and spin-off companies, the Innovation Fund on April 28, 2021, announces a Public Competition for financing under the support instrument “Co-financed grants for newly established start-up and spin-off companies “.

Purpose of the support instrument

This Instrument is expected to encourage the development of a culture of risk-taking and innovation, to provide support to legal entities wishing to develop a new or improved product, process, and / or service, as well as to encourage the commercialization of results. from research conducted within higher education or scientific research institutions.

Support will be given to projects that have at least a “proof of concept” and a clear ambition for commercialization.

The instrument supports projects that are in the confirmed concept phase up to the pre-commercial (pre-market) phase.

Activities eligible for funding

  • research and development activities;
  • development of pilot lines / product / s and / or service / s;
  • activities for testing and validation of new and / or improved products / services / processes;
  • market testing and validation activities for potential users;
  • activities related to the protection of intellectual property and
    design.

Applicant eligibility criteria

  • to be a trade company established in accordance with the Law on Trade Companies and registered in the Central Register of the Republic of Northern Macedonia or a team consisting of a maximum of 5 (five) members – individuals;

In case a company appears as an applicant, it should meet the following eligibility criteria:

  • the annual income of the applicant should not exceed 1,000,000 (one million) euros in denar counter value, according to the financial reports for the previous two fiscal years;
  • the average number of employees should not exceed 250 employees;
  • no more than 6 (six) years have passed from the moment of registration of the company to the moment of submitting a project proposal to the Fund;
  • the trade company is owned by a natural and / or legal entity (which is not state-owned), / association or foundation and / or institution that performs higher education, ie scientific research activity (with ownership share in the applicant up to 20%);
  • the applicant or his partners / shareholders are not directly or indirectly owners of over 20% in another / and trade company / and whose individual annual income exceeds 1,000,000 (one million) euros in denar counter value in the previous two fiscal years and whose average individual number of employees does not exceed 250 employees, except in case of connection with a higher education, ie scientific-research institution;
  • no bankruptcy proceedings or liquidation proceedings have been initiated against him;
  • to have settled due liabilities on the basis of public duties and contributions;
  • no proceedings have been initiated against him for forcible execution of overdue monetary claims;
  • in accordance with the Law on State Aid Control and the Decree on the conditions and the procedure for granting de minimis aid to meet the following conditions:
  • not to have accumulated more than 200,000 (two hundred thousand) Euros of minor assistance for a period of three fiscal years, including the requested amount of funds from the Fund;
  • not to have accumulated more than 100,000 (one hundred thousand) euros of minor assistance for a period of three fiscal years, including the requested amount of funds from the Fund, if the company is active in the road transport sector;
  • is not in difficulty (a company in difficulty is an enterprise that is unable to meet its obligations from its own resources or with funds it may receive from its owner / shareholders or creditors to stop losses, which without external intervention from providers will certainly lead to short-term and long-term cessation of operation of the enterprise), and
  • not to be engaged in coal production.

In case a team appears as an Applicant and whose project proposal has passed the selection phase, the Applicant is obliged within 30 calendar days after receiving the Notice of Project Selection, to establish a company in which at least 51 % of the team members, which company will assume all rights and obligations in relation to the implementation of the Project and which will meet the eligibility criteria of this article.

Eligible financing costs

  • Gross salaries with included salary supplements defined in accordance with the Law on Labor Relations (holiday work, Sunday work, shift work, night work, etc.) for persons who are or will be employed by the user and directly participate in the project. The amounts of gross salaries for the employees engaged in the project should correspond to the established practices of the beneficiary before the start of the project, reduced by the amount of potential state subsidy received on the basis of salary;
  • Procurement and / or rental of equipment and consumables for research and development;
  • Subcontracting research and development services (eg testing, laboratory services, etc.);
  • Hiring experts / advisors for research and development;
  • Hiring consultants for needs directly related to the project results (expertise in innovation management, financial management, asset mobilization, business development, marketing expertise for market testing and validation of potential beneficiaries, legal affairs, protection of intellectual property, etc.);
  • Preparation and filing of a patent, trademark and / or industrial design application
  • Office and business support (rental of office space, overhead costs, bank fees, accounting services, hosting and other types of operating costs related to the project implementation) in a maximum amount of 15% of the total project budget.

Ineligible financing costs

  • costs for procurement of goods, services and works from domestic public enterprises, except overhead costs;
  • interest or debt costs on the other side;
  • expenses and provisions for past or possible future losses or debts;
  • coverage of losses due to currency exchange, fees and penalties;
  • food and catering costs;
  • staff recruitment costs (costs for posting advertisements, commissions from employment agencies, costs related to the selection of candidates, etc.) and relocation costs;
  • purchase of land or buildings, including renovation;
  • cash payment from the designated account of the project;
  • export activities (costs directly related to the export of products, establishment and operation of a distribution network, etc. or for other current costs of the applicant related to export activities);
  • annual patent maintenance fees (with the exception of well-justified cases estimated as an allowable cost when evaluating project proposals);
  • salary supplements in the form of recourse for annual leave, thirteenth salary, work success, etc .;
  • costs for consulting services provided by the owner / s of the user as well as the authorized persons of the User (manager / director);
  • costs for consulting services provided by persons employed by the Beneficiary;
  • rental of business premises from a lessor that participates in the project activities or is a person related to a user;
  • procurement of freight transport vehicles by companies that perform freight road transport for rent or compensation;
  • procurement of passenger vehicles (with the exception of well-justified cases assessed as an allowable cost when evaluating project proposals);
  • costs for procurement of used equipment;
  • value added tax (VAT) for all procurements referred to in paragraph 1 of this Article;
  • direct marketing costs and
  • costs for realization of activities that were previously financed from other sources.

Amount of financial support per application

Through this instrument, the Fund for Innovation and Technological Development (hereinafter “the Fund”) provides:

  • up to 90% (ninety percent) of the total project budget, but not more than 40,000 (forty thousand) euros in denar counter value for companies up to 3 (three) years of existence until the moment of application or for a company that will be established within 30 days after receiving the Notification for selection of a project proposal (in case when a team appears as an applicant), ie
  • up to 85% (eighty five percent) of the total project budget, but not more than 60,000 (sixty thousand) euros in denar counter value for companies with over 3 (three) and less than 6 (six) years of existence until the moment of application.

The remaining amount (10% (ten percent) or 15% (fifteen percent)) of the total project budget should be provided by the applicant.

Project duration

The duration of the project can be up to 12 (twelve) months.

Criteria for evaluation of a project proposal

  • Degree of innovation;
  • Project quality;
  • Project team capacity;
  • Market potential;
  • Impact.

Criteria and sub-criteria for project evaluation are listed in the form – Evaluation table

Total budget for public competition

The total budget for the public competition is 2 million euros in denar counter value.

Return mechanism

The funds approved under this financial support instrument do not provide for a repayment mechanism.

Manner of application

You can download all the application forms by clicking on the button “Download documentation”

When applying, submit:

  • project application;
  • project budget;
  • statement of the Applicant for acceptance of the terms of the Fund;
  • environmental questionnaire and
  • Notarized statement for ownership – founding structure of the applicant (except in the case when the applicant is a team, it is submitted after the establishment of the company).
  • short biographies of the persons who composed the project team engaged in the project (maximum for 5 (five) people).

The project application, project budget and CVs should be submitted in Macedonian and English (in PDF and Excel format) and attached to the application form by clicking on the “Apply” button.

Other documentation related to the applicants should be submitted only in Macedonian language.

Deadline for application

The deadline for applying for the public competition for co-financed grants for start-ups and spin-off companies is until 12.06.2021. until 14.00.

Additional information

For all additional information you can:

  • to contact the e-mail address: startapuvaj3@fitr.mk
  • to call the telephone number: 02 3145 258

Frequently Asked Questions

1. Is it acceptable for the experts / consultants that we would hire for the realization of the project to be foreigners?

Yes, for the realization of the project you can hire outsiders, natural or legal, from the country and from abroad.

2. Do all items in the project budget have to be completed?

You fill in the project budget only in those items where you anticipate costs for the realization of the project. Not all items need to be completed.

3. Can I provide the necessary own participation through a bank loan?

Own participation can be secured from own funds or credit from commercial banks. Only funds received from the Fund on any other basis or any other form of state aid are not eligible as co-financing by the applicant.

4. Can the project team have one member?

According to the rulebook of this call, a project team can apply, which means a minimum of two, and a maximum of 5 (five) members-individuals. If the project team is selected for co-financing, it will have 30 days to establish the company with an ownership structure of at least 51% of the project team.

5. In what language should the video to be submitted with the application be?

Given that the projects are being evaluated by the Investment Approval Committee, composed of 5 foreign experts, the video needs to be recorded in English.

6. Can the same team apply for multiple projects?

Of course you can, but pay attention to the percentage of people engaged, as well as whether the same team will have the capacity to implement several projects at the same time.

7. What does the term “confirmed concept” mean?

“Confirmed concept” is the implementation of a specific method or idea in order to demonstrate its sustainability or to prove that it has the potential for practical application. The level of development of the concept is different for each industry, ie a separate project can be demonstrated in a different way.

8. Should the grant recipient immediately and fully secure his / her share of the co-financing from the very beginning of the project?

The beneficiary of the co-financed grant is not obliged to provide its part in full before the start of the project implementation. According to the text of the call and the rulebook for the instrument, the funds are paid on a quarterly basis, in accordance with the approved project budget in advance for each quarter. The applicant pays its own co-financing 10% or 15% of the amount provided for the quarter, after which the funds from FITR are paid from the approved budget for the quarter.

9. According to the planned costs for the activities for the project proposal with which we want to apply, when procuring the goods and services that exceed a certain amount when the bids need to be collected?

Bids do not need to be submitted in the application process, but it would be useful to have them as this way you can more accurately predict the budget.

10. Is the cost of renting space an acceptable cost?

Office and business support, including rental of office space, overhead costs, bank fees, accounting services, hosting and other types of administrative costs up to a maximum of 15% (fifteen percent) of the total project budget are considered eligible costs. The funds for office and business support are allocated on a quarterly basis, as a total amount, for the substitutions for which there is evidence of incurred cost.

11. Is there a conflict of interest when renting space?

Business premises cannot be rented from a lessor who participates in the project activities or is a person related to a user.

12. Can a company that has already won a grant from a previous FITR call and meets the eligibility criteria apply for the call?

A company that is already financially supported under another call of the Fund can participate in the call if it meets all the eligibility criteria, but the project proposal must be different from the one for which it has already received a co-financing grant.

13. Can existing employees be hired for the project?

If the people who will be engaged in the project are already employed in the company, you can include them in the project

the budget in the item salaries.

14. What if one of the employees changes during the project?

Given that the capacity of the project team is one of the criteria when evaluating the application, the employee must be replaced by a person with appropriate qualifications, a request for change will need to be submitted to the FITR monitoring team, which will forward it for approval by by the Investment Approval Committee.

15. What if the project needs changes during the project duration?

Any change in the project application and the project budget (changes in the action plan, key people in the project, reallocation of funds in the amount of more than 15% (fifteen percent) between the budget items of the total project budget, etc.) should be prior approved by the Committee on the basis of a request submitted by the Beneficiary with an attached revised project budget.


At the same time, we inform you that in order to increase your opportunities for obtaining financial resources, our Business Center provides FREE MENTORING SUPPORT for all interested companies, in the process of preparing your proposal application.

The realization of the right to free mentoring support is obtained according to the principle – “first reported, first served”. To take advantage of this great opportunity, all you need to do is fill out the application form, which you can access by simply clicking on the following link:

https://docs.google.com/forms/d/1QQ7Z2Kt48y2HGAnbLIuHE4OHfLVqtCgjdoppEIQT8kU/viewform?ts=609a84f4&edit_requested=true

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