The Subcomponent provides for establishment of a new refrigerated and/or dry-storage enterprise.

New storage enterprises for the following crops shall be financed:

• citrus fruits;
• stone fruits;
• berries;
• pome fruits;
• subtropical crops;
• nuts;
• vegetables;
• grains;
• melons and gourds;
• grapes.
  
  

The Subcomponent is available to an entrepreneurial legal entity in which the State holds no ownership interest, participation interest, or shares.

In addition, the potential beneficiary must be registered in:

• the Registry of Farms and Rural Enterprises
• the Registry of Economic Activities of the Legal Entity under Public Law - National Agency of Public Registry
  
  

Geographic Coverage

The Subcomponent applies in all municipalities of Georgia, except self-governing cities.

A grain storage enterprise may be financed in the cities of Batumi and Poti.

Agency co-financing: up to 40% of the total project cost, but not more than GEL 2,000,000.

In the case of cooperatives holding agricultural status, villages adjacent to the dividing line, and high-mountain settlements - up to 45%, but not more than GEL 2,000,000.

If the potential beneficiary/beneficiary uses the Preferential Agrocredit for Fixed Assets Component (except the Subcomponent for Timber-Harvesting Machinery), the amount of loan-interest co-financing actually paid/payable by the Agency for the beneficiary shall be deducted from the co-financing amount to be disbursed to the beneficiary under the project.

The total project cost must be at least GEL 500,000.

The submitted project must provide for establishment of a new refrigerated and/or dry-storage enterprise, and only fixed assets shall be co-financed:

• costs related to construction of buildings/structures, including value-added tax and the costs of transportation and installation of machinery/equipment;
• provision of the enterprise with the relevant utility connections.
  
  

Project Implementation Period

The Agency shall determine the project implementation period for the beneficiary.

The project implementation period shall not exceed 24 months from the date of execution of the agreement.

If the project is not completed within the prescribed periods, the Agency shall terminate the agreement executed with the beneficiary.

Criteria and Obligations

The storage capacity of the storage enterprise must be at least 500 tons;

The potential beneficiary must own the land plot on which implementation of the project is planned; the land plot must be free of attachment and registered with the Legal Entity under Public Law - National Agency of Public Registry; and, if acquired from the State subject to privatization conditions, such privatization conditions must have been fully satisfied and the land plot must constitute the purchaser's unconditional property.

See the prescribed standards for storage enterprises.

For the term of the agreement, the beneficiary shall encumber in favor of the Agency, by mortgage and pledge in accordance with the legislation of Georgia, the fixed assets created/acquired under the project (including buildings/structures).

The Agency's mortgage/pledge may rank second only where the first-ranking mortgagee/pledgee is the lending bank.

The potential beneficiary must have no outstanding tax liability to the State Budget. This requirement shall not apply where the amount of tax liability does not exceed GEL 1,000, collection of the tax liability has been deferred, or the obligation to pay it has been suspended by operation of law.

General Terms:

• Potential beneficiaries may participate if they have no ongoing contractual breach and/or litigation under projects/programs of the Rural Development Agency.
• The total cost of the submitted project must include the full amount of eligible costs under the Component.
• The cost of an audit report may be financed; co-financing shall not exceed 1% of the project cost and in any event shall not exceed GEL 20,000. The co-financing amount shall be included within the Agency co-financing limit applicable to the beneficiary.
• Any procurement contemplated by the project shall be carried out by the beneficiary only after execution of the agreement, from an entrepreneurial natural person and/or legal entity registered in accordance with the legislation of Georgia and/or through importation.
• Fixed assets to be purchased (plant/equipment/machinery/implements) must be new (not previously placed in service).
• A potential beneficiary may not participate in the Program, and co-financing shall not be disbursed to a beneficiary, if:
  • the potential beneficiary or existing beneficiary, or its founder, member, or shareholder, holds an ownership interest in a legal entity registered in accordance with the legislation of Georgia that supplies the relevant goods and/or services under the project;
  • the individual entrepreneur itself acts as the supplier of goods and/or services;
  • the potential beneficiary/beneficiary or its representative serves as a manager of the company supplying the goods and/or services.
  • Beneficiaries with whom a co-financing agreement is executed shall receive co-financing provided that, after this Resolution enters into force, they have no ongoing contractual breach and/or litigation under projects/programs of the Non-Entrepreneurial (Non-Commercial) Legal Entity - Rural Development Agency.
    
    

General Obligations:

• for three years from the date of disbursement of co-financing, not alienate the property created and financed under the project, any part of such property or related assets, or the land plot on which the project was implemented.

In the event of a breach, the Agency shall terminate the agreement and the beneficiary shall be required to refund the co-financing amount received.

• for three years from the date of disbursement of co-financing, ensure that the project operates solely in accordance with the intended purpose and profile established by the Program and/or the agreement.
• in the case of construction, submit, within the period determined by the Agency, the commissioning/acceptance certificate for the building/structure created under the project.
• submit information on project progress to the Agency at the intervals specified in the agreement.

In the event of a breach of the foregoing conditions, the Agency shall terminate the agreement and the beneficiary shall be required to refund the co-financing amount received, or the Agency may grant the beneficiary an additional period to perform the obligation.

Steps Required to Receive Co-Financing

List of documents to be submitted under the Co-Financing of Storage Enterprises Subcomponent

Co-financing shall be disbursed after performance of the obligations under the agreement is confirmed by the submitted audit report and by an on-site inspection conducted by the Agency.

In the case of construction, a construction permit issued in accordance with the legislation of Georgia must be submitted.

For construction/repair/reconstruction works with a value of at least GEL 200,000, the value of the completed works must be confirmed by:

• a report issued by a person accredited by the Legal Entity under Public Law - National Accreditation Body (Accreditation Center)
  or
• an expert report issued by the Legal Entity under Public Law - Levan Samkharauli National Forensics Bureau

Before co-financing is disbursed, the beneficiary shall, for the term of the agreement, mortgage in favor of the Agency, in accordance with the legislation of Georgia, the land plot on which the project was implemented.

The Agency's mortgage may rank second only where the first-ranking mortgagee is the lending bank.

During the term of the agreement, the Agency may conduct on-site inspections and documentary monitoring.

A completed application form and supporting documentation may be submitted in hard copy to the central office of the Rural Development Agency, its regional divisions, or information and consultation centers.

The foregoing documentation may also be submitted to the Agency by email at: document@rda.gov.ge .

The documentation must be accompanied by an application regarding submission of a new application.