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ORDER OF THE GOVERNMENT OF THE REPUBLIC OF ARMENIA

of March 26, 2020 No. 355

About approval of the first action for neutralization of economic consequences of coronavirus

Accepted on March 26, 2020

Assuming as a basis part 4 of article 146 of the Constitution of the Republic of Armenia, the Government of the Republic of Armenia decides:

1. Approve the first action for neutralization of economic consequences of coronavirus according to Appendix.

2. Charge to the Minister of Finance of the Republic of Armenia and suggest the chairman of the Central bank of the Republic of Armenia to provide procedure for use of instruments of the help, stipulated in Item 9 Appendices to this Resolution till March 31, 2020, having fixed in it also mechanisms of public and transparent implementation of process, including publication of the list of the business entities using the help.

Prime Minister of the Republic of Armenia

N. Pashinyan

Appendix

to the Order of the Government of the Republic of Armenia of March 26, 2020 No. 355

First action for neutralization of economic consequences of coronavirus

1. Purpose of action and help

1. The purpose of action is the help of the RA to certain business entities (further – business entities) for risks mitigation connected with the current feasibility at the last predicted as a result of spread of coronavirus.

2. The purpose of the help is creation for business entities of possibility of temporary availability of financial resources to reaction to changeable conditions of demand, opposition to external challenges and, respectively, implementation of actions for continuation of activities and reorganization and adaptation to the changed economic situation and refining of the development strategy.

2. Circle of business entities

3. In sense of this action the organization is considered business entity or the individual entrepreneur registered and performing the actual activities in the territory of RA (except for banks, credit institutions, pawnshops and insurance companies, exchange bureaus of foreign currency, the organizations which are engaged in purchase and sale of securities, the investment organizations, investment funds, organizers of lotteries and games with prize and persons who are engaged in other similar activities) which performed trading activity in the territory of RA at least, than within the last year, has good credit and tax history, that is the size of the overdue tax liabilities for the complete accounting periods entering in the last 365 days did not exceed 1 percent of the obligations paid for the last 365 days, but no more than 50 thousand dram.

3. Help forms

4. The help is provided to business entities in the form of joint financing, refinancings and subsidizings of interest rate for purpose-oriented loans received from banks or credit institutions operating in the territory of RA (further – the financial organization). The purpose of the provided forms of the help is the decision:

1) joint financing: tasks on partial neutralization of insufficient level of measure of providing, currency risk at business entity as regards the credit, and also to partial expense reduction as regards percent;

2) refinancing: tasks of complete neutralization of currency risk at business entity as regards the credit, and also to partial expense reduction as regards percent;

3) subsidizing: task of essential decrease in interest expenses at business entity as regards the credit.

5. For each business entity only one of help forms is applicable.

4. The purpose of the credits obtained on instruments of the help

6. Forms of the help are applicable to the loans which are granted to business entities for the purpose of implementation only of one of the following expenses:

1) the salary to the staff of business entity or the payments equated to it, but in the amount of no more than 500 000 dram a month for each employee, no more than for three months (further – the credits for employees);

2) payment in the government or local authority budget of taxes, duties and obligatory payments no more than in three months (further – the credits on taxes, duties and obligatory payments);

3) purchase or import of raw materials provided that all amount of raw materials shall be used in the Republic of Armenia for the purpose of receipt of finished goods, and the business entity owns necessary and corresponding production capacities (further – the credits for raw materials);

4) purchase or import of new devices and the equipment provided that these devices and the equipment shall be used for the purpose of production organization or expansion of production in the Republic of Armenia;

5) payment of public services (implementation of expenses as regards the electric power, waters, gas, communication and telecommunications, but in the amount of no more than 5 000 000 dram of RA a month on each service, no more than for three months (further – the credits on utility payments);

6) import of products and drugs by the business entities carrying on business provided that the imported goods shall be implemented in Armenia (further – the credits for food).

5. The main requirements for the loans granted on instruments of the help

7. The loans granted using instruments of the help shall conform to the following requirements:

1) currency – dramas of RA, for the instrument of joint financing the part provided by the financial organization can be expressed also in foreign currency;

2) term – up to 24 months;

3) maximum amount of the loans granted on the instrument of the help on one business entity – equivalent 500 million to dramas of RA, and the sizes of maximum amount of joint financing or refinancing of one business entity cannot exceed 250 million dram of RA;

4) procedure for use of borrowing facilities – only wire and bank transfers;

5) the maximum actual interest rate from 0% to 6% per annum (no more than 6%), depending on the rule established by this action for the used instrument of the help.

8. The loans will be granted by all commercial banks and credit institutions operating in the territory of RA.

9. The procedure for use of instruments of the help will be approved by the order of the Government RA which will establish details of requirements to credit institutions, to receivers of the help, and also the procedure of ensuring target use of means and accomplishment of obligations assumed in relation to the state within the action, and responsible for supervision of them.

6. Description of content of instruments of the help

10. For the purpose of receipt of the credit within this action each business entity corresponding to conditions, the provided actions can submit the application to the financial organization in case of which satisfaction at the request of the borrower according to the rules established by this action it will be performed:

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