Development Law – Agri-Food 2026: who is eligible for funding for production and processing?

The minimum eligible amount of the investment plan is determined by the
size and legal form of the applicant. The classification of a business
as micro, small, medium-sized or large does not depend solely on its own
financial data, but also on any partner or linked enterprises.

The budget must be realistic

Meeting the minimum threshold does not mean that the business should
declare a larger investment than it can finance and
operate. The budget must be linked to:

• The unit’s actual production capacity.
• The ability to cover the own contribution.
• Access to bank financing or another lawful financing instrument.
• Projected sales and gross profit margin.
• The working capital required after completion.
• The ability to implement the project and pay the expenses on time.

There is no single funding rate for everyone.
Aid intensity depends on the location, the size
of the business, the type of investment, the category of expenses and
the incentive requested.

What determines the final rate

Example of correct interpretation

A small processing business may receive a different rate from
a micro primary-production unit, even if both investments
are implemented in the same Region. For this reason, the final amount of aid
is calculated only after analyzing the applicant, the region and the expenses.

The Development Law does not offer only a direct grant.
The appropriate incentive depends on the profitability of the business,
its tax position, the financing method and the ability
to pre-finance the investment.

The investment plan must qualify as an
initial investment. A single purchase
or the simple replacement of old equipment without a substantial change
to production operations is not sufficient.

The 2nd Call focuses on investments in
primary agricultural production and
the processing of agricultural products.
Eligibility is assessed not only by the business’s trade name,
but also by the product produced, the raw material and the processing output.

Indicative primary-production investments

• Agricultural production units.
• Greenhouse and other covered crops.
• Livestock facilities.
• Poultry units, where the specific conditions are met.
• Beekeeping investments covered by the call.
• Storage and support facilities for the production unit.
• Equipment for handling, sorting or initial processing of production.

Indicative processing investments

• Milk processing and standardization units.
• Cheese dairies and dairy-product units.
• Olive mills and olive-oil standardization units.
• Wineries and grape-processing units.
• Meat-processing units.
• Fruit and vegetable sorting, standardization and packaging units.
• Units processing cereals and other agricultural raw materials.
• Cold-storage and warehousing facilities forming part of the productive investment.

Expenses must be new, necessary, reasonable and
directly linked to the investment plan. It is not enough for them to fall
generally within an eligible category.

What is checked in each quotation

• The exact technical description of the equipment.
• Its connection to the production process.
• Capacity before and after the investment.
• The necessity and reasonable price of the expense.
• Compatibility with the required permits.
• The issue date and validity of the quotation.
• Avoidance of a binding order before the application.

An expense may be rejected even when it appears useful to
the business, if it is not directly linked to the initial investment,
was incurred prematurely or does not meet the specific conditions.

• Used equipment: As a rule, new, modern equipment is required.
• Day-to-day operating expenses: Raw materials, goods, bills, ordinary operating expenses
  and general working capital do not constitute a productive investment.
• Simple replacement: Replacing a machine without increasing capacity or substantially
  changing production is not sufficient.
• Expenses incurred before the permitted date: Binding orders, deposits and work carried out before
  submission may remove the incentive effect.
• Non-production equipment: Equipment without a documented link to operations and the
  production objective of the investment may be reduced or rejected.
• Overpriced or vague quotations: Quotations without technical specifications or with unreasonable costs
  create a risk of reductions.

The business must prove that it can cover the part of the investment
that is not funded under the Development Law. A high aid rate
does not mean that the investor needs only the remaining percentage.

In practice, sufficient financing is required to implement the project, pay
the expenses, cover VAT where it is not eligible, and operate the unit
until the aid is utilized.

How the financing can be covered

What the financing plan must include

• The unsupported portion of eligible expenses.
• The project’s ineligible expenses.
• VAT, when it is not an eligible cost.
• Possible price increases before the equipment is purchased.
• The working capital of the new or expanded unit.
• The period until certification and utilization of the aid.

The investment must retain its incentive effect. This means that
the investor must not have undertaken an irreversible commitment to
implementation before the permitted date.

The Development Law Business Plan is not a
general description of the business idea. It is the financial and
strategic documentation demonstrating that the investment can be implemented,
operate and generate a viable economic result.

What a well-developed Business Plan connects

• The applicant and the actual business activity.
• The product, production process and target market.
• The activity code and the eligibility of the activities.
• The budget and the technical specifications of the expenses.
• Production capacity before and after the investment.
• The own contribution and financing sources.
• Sales, cost and profitability forecasts.
• Working capital and actual cash requirements.
• The score, viability and ability to complete the project.

The file must demonstrate the applicant’s eligibility, the legality
of the facility, the maturity of the investment and the ability to finance it.
The exact supporting documents vary by applicant and plan.

Submission is carried out electronically through the Development Law
Information System. Entering the application is the final stage
of a process that must already have been completed technically and financially.

The evaluation is not limited to checking whether all files have been attached.
It examines whether the applicant, investment, financing and financial forecasts
form a complete and implementable plan.

The grant is not paid automatically upon the inclusion decision.
It is linked to implementation of the investment plan, payment of the
expenses and certification of the physical and financial scope.

What must occur before payment

• Implementation of the approved work and procurements.
• Lawful issuance and payment of invoices and supporting documents.
• Installation and operation of the equipment.
• Submission of a request for inspection or certification.
• Inspection of the physical and financial scope.
• Acceptance of any amendments or reductions.

The following are indicative examples. Final eligibility depends
on the applicant, product, region, expenses and the nature of the investment.

The preliminary assessment precedes preparation and submission of the file.
Its purpose is to determine in good time whether the investment can be supported
legally, technically and financially.

• Review of legal form and business size.
• Review of activity code, activity and product produced.
• Review of the implementation region and aid rate.
• Review of the initial-investment nature.
• Review of eligible expenses and quotations.
• Calculation of the own contribution and financing gap.
• Review of licensing and property maturity.
• Initial assessment of viability and profitability.