28.02.2024 Business law

PFR requests return of subsidies from the SMEs Financial Shield

The Polish Development Fund (PFR) clears the accounts of subsidies for small and medium-sized enterprises granted in connection with the COVID-19 pandemic. More and more often PFR attempts to recover funds spent under the SMEs Financial Shield. Some of the entrepreneurs who benefited from the support under the SMEs Shield have already received notices to return subsidies.

Notices to return subsidies – whom are they sent to?

PFR more and more often, usually before paying the last instalment, sends pre-judicial notices to entrepreneurs to return the entire subsidy obtained. It is often justified that there were irregularities in the statements given by entrepreneurs. It is currently estimated that several thousand entities benefiting from PFR subsidies under the SMEs Financial Shield could receive notices to return them.

As PFR informs, requests for clarification or return of part or all of the aid include, but are not limited to beneficiaries who:

  • when applying for financial support under Programme 1.0, as sole proprietors, contrary to their obligation did not take into account the links between them and civil-law partnerships that also applied for support under the Programme 1.0 and in which those sole proprietors had a status of a partner (approximately 500 entities); 
  • applied for support under Programme 1.0 despite having the status of a large enterprise in the light of the programme conditions of the Financial Shield 1.0 due to the size of the business carried out and/or ownership structure – in a situation where the support under Programme 1.0 was intended for micro-enterprises and SMEs (approximately 300 entities);
  • after the date of receipt of the financial subsidy, they adjusted sales revenues in the months taken into account when calculating the amount of the subsidy (approximately 2700 entities);
  • after the date of receipt of the financial subsidy, they adjusted the number of employees at the end of the month preceding the month of submission of the application (the number of employees on that date determined the amount of the subsidy for micro-enterprises) or at the end of 2019 – the condition for participation in Programme 1.0 was the employment status at the end of 2019 (approximately 1000 beneficiaries).

In some cases, PFR has already brought legal actions to recover the funds granted in full together with interest. The Ombudsman for SMEs stepped in to resolve irregularities in the settlement of subsidies by the PFR. The Ombudsman argues that the PFR should take into account the objectives of the government’s programmes, including the financial stabilisation of enterprises and protection of jobs. The SMEs Ombudsman also stresses that entrepreneurs should not be accused of providing false data when this was due to inaccurate rules or modification of rules when the programmes were in operations.

If you receive notice from PFR – we can help you

As already mentioned, the notices concern a large part of beneficiaries, and PFR is increasingly seeking legal action to recover the funds granted in full together with interest. Therefore, we offer you comprehensive assistance including defence against claims and representation in court proceedings.

If your organisation has already received a notice for payment or a lawsuit from PFR, we will help you analyse the matter and prepare your defence.

PFR notices – see how we can help!

Grzegorz Witczak Director of the Commercial Law and Property Department
TGC Corporate Lawyers
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