-
Special
Loan Guarantee Scheme
-
SME
Loan Guarantee Scheme
- SME
Export Marketing Fund
- SME
Development Fund
Special Loan Guarantee Scheme (SpGS)
Eligibility
Application
Procedures
Guarantee
Amount and Period
Other
Information
Enhanced Measures
Extension of the Scheme (from 1 January – 30 June 2010)
Extension of the Scheme (from 1 July – 31 December 2010)
SME Loan Guarantee Scheme (SGS)
Eligibility
Application
Procedures
Use
of Loans
-
Business Installations and Equipment Loan Guarantee
- Working Capital Loan Guarantee
Guarantee
Amount and Period
Other
Information
SME Export Marketing Fund (EMF)
Eligibility
Amount of Grant
Application Procedures
Amendment/Cancellation of Applications
Application Result
Others
General
Eligibility
Types of Projects
Budget, Grant and Contributions
Application
Vetting
Implementation of the Project
Special Loan Guarantee Scheme
The Special Loan Guarantee Scheme (SpGS) aims to help enterprises secure loans from participating lending institutions (PLIs) for meeting general business needs to tide over the liquidity problem during the global financial crisis with the Government acting as the guarantor.
SpGS is a time-limited scheme which is open for applications since 15 December 2008. The application period will be extended up to 31 December 2010.
Eligibility
Enterprises with substantive business operation (note 1) in Hong Kong and registered in Hong Kong under the Business Registration Ordinance (Chapter 310), except listed companies, lending institutions and their associates.
Other requirements
note 1: The applicant should have substantive business operations in Hong Kong. In this connection, an enterprise holding a shell business registration or having most of its main business operations outside Hong Kong will not be regarded as having substantive local business operations. For details, please refer to the "Guideline on the requirement of "substantive business operation" under the Special Loan Guarantee Scheme and SME Loan Guarantee Scheme".
Personal guarantee is required of the owner or, in the case of a limited company, shareholders (whether an individual or firm) together holding more than 50% of the equity interest of the enterprises. The loans should also not be used for repaying, restructuring or repackaging other loans.
Application Procedures
Yes. As long as your company has been and remains duly registered under the Business Registration Ordinance, has substantive business operation in Hong Kong and has met other eligibility criteria as stated above, it will be eligible to apply for the SpGS.
All enterprises interested in applying for a loan under SpGS should complete an Application Form and lodge through the PLIs. The application procedure is simple and involves no charges. The application form can be downloaded at this homepage. The relevant PLI will assess your application and determine whether the loan application requires the guarantee of the SpGS. If so, the PLI should endorse and send in the application form and relevant documents to Trade and Industry Department.
No. All applications for guarantee under the
Scheme are free of charge.
Documents needed may include:
In addition, a limited company is required to
pass its latest audited accounts and an unlimited company its latest financial
statements to the PLI concerned at the time of lodging the loan application.
The PLI may also accept latest available audited accounts from a limited
company or latest available financial statements from an unlimited company
instead if it is consistent with the prevailing practice of the PLI in respect
of loans granted outside the SpGS.
This requirement will not apply to enterprises that are established for less than 18 months at the date on which the loan application is received by the PLI concerned, though the PLI will also assess their current credit and financial information. For these enterprises, they are required to produce documentary proof on their date of establishment.
Guarantee
Amount and Period
The maximum amount of guarantee for an enterprise is 80% of the approved loan, subject to a maximum loan amount of $12 million. Within this limit, an enterprise may obtain from the PLIs a revolving credit line of up to $6 million.
The maximum guarantee period for each loan is 60 months after the start date (note 2), or up to 31 December 2015, whichever is earlier.
note 2: For term loans, it means the date on which any funds are first withdrawn against the approved loan. For revolving loans, it means the date on which the funds are made available for use by the enterprise.
In respect of a term loan, the PLIs may grant a grace period in the first six months, during which the enterprise may pay the interest only. Thereafter, the loan should be repaid to the PLI by installments over a maximum of 54 months or up to 31 December 2015, whichever is earlier. The period between each repayment of principal should not exceed three months.
In respect of a revolving credit line, the repayment should be made to the PLI over a maximum of 60 months or up to 31 December 2015, whichever is earlier. There will not be any fixed repayment period for revolving loans, but the PLIs are encouraged to term-out the loans at a suitable juncture to ensure an orderly repayment of the outstanding loan before expiry of the guarantee period.
Other Information
No. The Government will rely on participating lending institutions to exercise their usual prudent professional judgment in assessing applicants' creditworthiness.
Under the market driven principle, there is no standard interest rate for loans under the SpGS. The interest rate shall be a matter of the commercial decision between individual lending institutions and borrowers. However, the Government has asked participating lending institutions to take into account Government's guarantee when they decide on the interest rates to be charged.
Yes. The Government may issue more than one guarantee in favour of the same or different participating lending institutions with respect to an enterprise, as long as the cumulative maximum amount of loan issued to the enterprise does not exceed the ceiling.
Yes. SGS and SpGS will be operated concurrently. An enterprise can obtain a Guarantee under both schemes provided that it is eligible for and fulfill all the terms and conditions respectively.
PLIs may refer to "Guide to Application" which is available for downloading from SpGS website.
For more information about the SpGS, please contact banks or financial institutions which have participated in the Scheme. A list of participating lending institutions can be obtained from this homepage. Alternatively, you may contact the Trade and Industry Department at :
| Tel: |
(852) 2398 5132 * |
| Fax: |
(852) 3690 1767/ 3741 2177 |
| Email: | |
| Website: |
* All telephone conversations on the enquiry hotlines of the Trade and Industry Department shall be recorded to ensure service quality. The recorded conversations will be kept for 90 days. Members of the public may request for conversations relevant to them recorded in 90 days on a CD, at a charge of $50 per CD.
Enhanced Measures (with effect
from 15 June 2009)
The enhanced measures include :
note 3: For enterprises which had successful applications prior to the implementation of the enhancement measures, the maximum amount of guarantee may be less than $9.6 million and $4.8 million respectively. For example, if an enterprise has already taken out a $6 million loan under 70% guarantee ratio, the maximum amount of loan guarantee that it may obtain with the $12 million loan ceiling would be $6 million x 70% + $6 million x 80% = $9 million.
The enhanced measures were implemented with effect from 15 June 2009.
The effective date of the enhanced measures for each PLI depends on the date of signing and returning the Supplemental Deed to TID. Different PLIs may have different effective dates. PLIs should check their respective effective dates before submitting applications to TID. Applications submitted to TID before the effective date will be processed under the old rules (i.e. 70% guarantee, $6 million loan ceiling, and 3 years guarantee period).
No. The 80% guarantee ratio will only apply to applications submitted to TID after the effective date (please see question 19 for the meaning of effective date).
No, details are set out as follows :
Enterprises with substantive business operation (note 1) in Hong Kong and registered in Hong Kong under the Business Registration Ordinance (Chapter 310), except listed companies, lending institutions and their associates. Other requirements -
No. The maximum amount of loan that each enterprise may obtain is $12 million. It is not acceptable to obtain a larger loan even if the PLI is willing to accept a lower guarantee ratio.
PLIs that want to apply for loans exceeding $12 million with a lower guarantee ratio may consider the SME Loan Guarantee Scheme (SGS) instead. The guarantee ratio under SGS is 50%. It does not have any limit on the amount of loan to be granted by the PLIs, provided the maximum amount of guarantee for each borrower does not exceed $6 million.
A grace period of six months will continue to be allowed for non-revolving loans, during which the borrower may repay interest only. Thereafter, the loan should be repaid over a maximum of 54 months.
Extension of the Scheme (from 1 January – 30 June 2010)
The application period for the SpGS is extended to 30 June 2010.
No, the features of the SpGS will remain unchanged. Details
are as follows:
No, please refer to question 21 for
details.
No, all applicants must duly complete the application form and have them submitted through the PLIs. Relevant details and the list of PLIs have been uploaded to the webpage of SME Funding Schemes.
Extension of the Scheme (from 1 July – 30 December 2010)
The application period for the SpGS will be further extended to 31 December 2010. This will be the last extension. Trade and Industry Department will stop receiving new applications from the PLIs with effect from 1 January 2011.
No. Details are set out in questions 25, 26 and 27.
SME Loan Guarantee Scheme
The SGS is a loan guarantee scheme whereby the Government acts as the guarantor of individual small and medium enterprises (SMEs) to facilitate them to secure loans from banks and financial institutions that have participated in the Scheme [i.e. the Participating Lending Institutions (PLIs)] for (a) acquiring business installations and equipment and for (b) meeting working capital needs of general business uses.
The overall objective of the Scheme is to assist SMEs to enhance their productivity and competitiveness.
The SGS provides two types of guarantees. They are -
Eligibility
To be eligible for the Scheme, a Borrower:
- provides services for its members (whether or not for the purpose of gain); and
- has club premises of which its members have a right of exclusive use.
* The applicant should have substantive business operations in Hong Kong.
In this connection, an enterprise holding a shell business registration
or having most of its main business operations outside Hong Kong will not be
regarded as having substantive local business operations. For details, please
refer to the "Guideline
on the requirement of "substantive business operation" under the Special
Loan Guarantee Scheme and SME Loan Guarantee Scheme" promulgated
by the Trade and Industry Department (TID).
** "Number of persons employed" shall include individual proprietors,
partners and shareholders actively engaged in the work of the business;
and salaried employees of the business, including full-time or part-time
salaried personnel directly paid by the business, both permanent and temporary,
at the time of lodging applications under the SGS.
Yes. As long as your company has been and remains duly registered under the Business Registration Ordinance, has substantive business operation in Hong Kong, and has met other eligibility criteria as stated above, it will be eligible to apply for the SGS.
Application Procedures
All applications for the SGS must be lodged through the PLIs. The relevant PLI will assess your application and determine whether the loan application requires the guarantee of the SGS. If so, the PLI will refer the guarantee application to TID of the HKSAR for consideration.
No. All applications for guarantee under the Scheme are free of charge.
You should pass to the relevant PLI a copy of the valid Business Registration Certificate of your business when lodging the application for guarantee.
In addition, a limited company is required to pass its latest audited accounts and an unlimited company its latest financial statements to the PLI concerned at the time of lodging the loan application. This requirement will not apply to SMEs that are established for less than 18 months at the date on which the loan application is received by the PLI concerned, though the PLI will also assess their current credit and financial information. For these SMEs, they are required to produce documentary proof on their date of establishment.
For application for business installations and
equipment loan guarantee, if the business installations and equipment to
be acquired under the SGS shall be used by another business entity inside
or outside Hong Kong, you need to seek the prior consent of the PLI concerned
and the Government on such arrangement. In making application to the Government,
you should provide supporting document(s). In case if the business installation
and equipment is located in the Mainland China, you can provide investment
approval certificate, agreement on materials processing, production agreement
etc. as the supporting document to show the relationship between your business
and the end user of the business installations and equipment. Provided that
the arrangement is relevant and essential to your operation in Hong Kong,
TID will give favourable consideration to the application.
The Government allows a nine-month period from the end of your business's financial year for you to prepare the relevant audited accounts/financial statements. If the loan application is made within the above grace period, it will be acceptable for you to show only the preceding accounts. However, if the required audited accounts/financial statements represent the first accounts of your business, they are expected to be available 18 months after the date of establishment of your business.
Upon receipt of duly completed applications for guarantee from PLIs, TID will normally take no more than three clear working days to process the applications.
You may contact the relevant PLI for the application status.
Use
of Loans
- Business Installations and Equipment Loan Guarantee
The business installations and equipment loan guarantee covers items of machinery, tool, computer software and hardware, communication system, office equipment, transport facilities, furniture, and fixtures (e.g. air-conditioning system, built-in cabinets and lighting system. However, it does not cover decoration works).
Can I apply for guarantee if the business installations and equipment are located outside Hong Kong?
Yes. Provided that they are to be used by the borrower, the business installations and equipment to be acquired under the SGS may be placed outside Hong Kong with the prior written consent of the PLI concerned. However, if the arrangement involves selling, sub-leasing, charging or part with possession of the business installations and equipment, the prior consent of the Government is also required. In making application to the Government, you should provide supporting document(s). In case if the business installation and equipment is located in the Mainland China, you can provide investment approval certificate, agreement on materials processing, production agreement etc. as the supporting document. Provided that the arrangement is relevant and essential to your operation in Hong Kong, TID will give favourable consideration to such application.
Yes. The loans may be used for acquiring second-hand installations and equipment.
Yes. Under normal circumstances, if the business installation/equipment is delivered to the borrower for trial use only and payment for the installation/equipment has not been made in full, it is still eligible to apply for the Scheme.
No. The objective of the SGS is to help SMEs obtain new money to acquire installations and equipment relating to their business operations for enhancing competitiveness and productivity. Hence, the business installations and equipment loans cannot be used for financing or re-financing any acquiring of installations and equipment that have already been in the possession of the borrower or any of its associates at any time on or before the date on which an application for facility is received by the relevant PLI.
- Working Capital Loan Guarantee
The working capital loan guarantee under the SGS should be used for meeting working capital needs of general business uses of the SMEs. SMEs are not allowed to use the working capital loan(s), whether in whole or in part, to pay, repay, restructure or repackage any loan, credit facility or payment obligation.
Yes. The working capital loan guarantee is not conditional on the applicant having first obtained business installations and equipment loan guarantee under the SGS or the SME Business Installations and Equipment Loan Guarantee Scheme.
Guarantee
Amount and Period
With effect from 6 November 2008, the amount of guarantee for an SME is 50% of the approved loan, subject to a maximum amount of $6 million. The guarantee can be used to secure loans for either business installations and equipment or working capital, or a combination of both.
Yes, with effect from 6 November 2008, the amount of guarantee for an SME is 50% of the approved loan, subject to a maximum amount of $6 million. The guarantee can be used to secure loans for either business installations and equipment or working capital, or a combination of both.The $6 million maximum guarantee amount is cumulative in nature, the SME can still enjoy an additional $1 million guarantee for business installations and equipment loan / working capital loan (or 50% of the approved loan, whichever is the less).
On the other hand, under the enhanced Scheme, if an SME has fully repaid the business installations and equipment loan(s) or working capital loan(s) backed up by the guarantee under the Scheme, the SME is eligible for the respective guarantee amount one more time, subject to a maximum amount of $6 million.
Yes, with effect from 6 November 2008, the amount of guarantee for an SME is 50% of the approved loan, subject to a maximum amount of $6 million. The guarantee can be used to secure loans for either business installations and equipment or working capital, or a combination of both. The $6 million maximum guarantee amount is cumulative in nature, the SME can still enjoy an additional $5 million guarantee for business installations and equipment loan / working capital loan (or 50% of the approved loan, whichever is the less).
On the other hand, under the enhanced Scheme, if an SME has fully repaid the business installations and equipment loan(s) or working capital loan(s) backed up by the guarantee under the Scheme, the SME is eligible for the respective guarantee amount one more time, subject to a maximum amount of $6 million.
The guarantee period for the business installations and equipment loan and working capital loan is up to a maximum of five years.
For business installations and equipment loan guarantee, the guarantee period will count from the starting date of the approved loan, i.e. the date on which funds are first withdrawn against the approved loan, or the date on which the hire-purchase agreement takes effect.
For working capital loan guarantee, the guarantee period will count from the starting date of the approved loan, i.e. the date on which funds are first withdrawn against the approved loan.
Business installations and equipment loans guaranteed under the SGS should be non-revolving loans or hire-purchase agreements. They should be repaid to the relevant PLI by instalments. The first instalment should take place not later than six months after the loan has been activated and the interval between subsequent instalments should not exceed three months.
Working capital loans guaranteed under the SGS should be non-revolving loans. They should be repaid to the relevant PLI by instalments. The first instalment should take place not later than six months after the loan has been activated and the interval between subsequent instalments should not exceed three months.
Other Information
No. The Government will rely on PLIs to exercise their usual prudent professional judgment in assessing applicants' creditworthiness.
Under the market driven principle, there is no standard interest rate for loans under the SGS. The interest rate shall be a matter of the commercial decision between individual lending institutions and borrowers. However, the Government has asked PLIs to take into account Government's guarantee when they decide on the interest rates to be charged.
Yes. The Government may issue more than one guarantee in favour of the same or different PLIs with respect to an SME, as long as the cumulative amount of guarantee issued to the SME and the corresponding PLI(s) are within their respective ceilings.
For more information about the SGS, please contact banks or financial institutions which have participated in the Scheme. A list of PLIs can be obtained from this homepage. Alternatively, you may contact TID at :
| Tel: |
2398 5129 * |
| Fax: |
2396 5067 |
| Email: | |
| Website: |
* All telephone conversations on the enquiry hotlines of the Trade and Industry Department shall be recorded to ensure service quality. The recorded conversations will be kept for 90 days. Members of the public may request for conversations relevant to them recorded in 90 days on a CD, at a charge of $50 per CD.
SME Export Marketing Fund
Businesses which are registered in Hong Kong
under the Business
Registration Ordinance (Chapter 310) and fulfill Government's definition
of the SMEs, as follows, can apply for grant under the EMF -
a. any manufacturing business which employs fewer than 100 persons in Hong Kong; or
b. any non-manufacturing business which employs fewer than 50 persons in Hong Kong.
Only local SMEs registered in Hong Kong under the Business Registration Ordinance (Chapter 310) are eligible. In addition, an SME must have substantive business operation as registered in Hong Kong; otherwise its application may be rejected. An SME holding a shell business registration or having its main business operation outside Hong Kong will not be regarded as having substantive local business operation and hence, the relevant application may be rejected. TID reserves the right to determine whether an SME is eligible to apply for the EMF.
Only businesses carried on for the purpose of gain are eligible for applying the EMF. Hence, non-profit making companies are not eligible.
The organiser and any of its related or associated companies are not eligible for applying grant under the EMF in respect of the export promotion activities organised or co-organised by them.
The EMF provides grant to SMEs for their participation in trade fairs/exhibitions and business missions outside Hong Kong, as well as local trade fairs/exhibitions which are export-oriented. Such export promotion activities must be organised by bona fide organisations/companies and directly relevant to the business of the applicants. The form of SMEs' participation must be as exhibitors of the trade fairs/exhibitions or as delegation members of the business missions.
The EMF also provides grants for advertisements on printed trade publications targeting export markets; as well as advertisements placed on eligible trade websites. The list of Eligible Websites will be updated from time to time on TID's website.
TID reserves at all times the absolute right to
determine whether the applicant's and the organiser's eligibility, the nature
of the export promotion activity (including whether the activity is export-oriented),
the relevancy of the activity to the business operation of the applicant and
the applicant's form of participation or advertisement are acceptable under
the EMF.
The objective of the EMF is to encourage and support SMEs to expand their overseas markets (including the Mainland market). In this regard, conferences, workshops and seminars that mainly aim to understand the related market development and technical solutions or for experience sharing purpose are not eligible for the EMF.
To be eligible for the EMF, the itinerary of the business mission must be able to demonstrate that it is export-oriented and provide ample opportunity for participants to meet potential overseas customers. TID will evaluate the overall attributes and initiatives of the study mission to determine its eligibility. Existence of certain key initiatives for export trade promotion may not necessarily constitute the mission itself as fulfilling the objective of the EMF. Also, an overseas trip including visiting a trade fair or exhibition, regardless of whether the details like travelling and hotel accommodation are arranged by an SME itself or made through a travel agent, would not be regarded as an eligible business mission.
TID reserves at all times the absolute right to determine whether the business mission itself is acceptable under the EMF.
No. Any exhibition and trade mission will be evaluated independently subject to the terms and conditions prevailing at the material time. Previous approval of EMF grants should not be taken as guaranteed approval for the same/similar activities in future.".
The advertisements must be placed on printed trade publications targeting export markets or on eligible trade websites. The list of Eligible Websites will be updated from time to time on TID's website.
Export promotion activities organised by individual SMEs are not eligible for the EMF. The reasons are -
Yes, provided that the advertisements are placed on eligible trade websites. The list of Eligible Websites will be updated from time to time on TID's website.
Only the following expenditures incurred by SMEs in relation to their participation in the eligible export promotion activities will be subsidised by the EMF -
Relevant expenditures must be directly incurred
and fully paid by SMEs themselves in relation to their participation of
the concerned activities through their employers and/or employees. TID at
all time reserves the absolute right to determine whether the expenditures
incurred, the route of travelling, the period of stay and the involved portions
will be regarded as fundable items including the method to calculate the
amount of grant.
Successful applicants shall not be subsidised by any other public funding scheme(s) [whether provided by the Government of the HKSAR] in respect of the same export promotion activity(ies). TID at all times reserves the absolute right to determine whether such a provision of fund will constitute a double benefit.
The EMF aims at helping SMEs expand their businesses through active participation in export promotion activities. In this connection, SMEs must participate directly in the export promotion activities themselves via their employers and/or employees. Participation through any other ways including third party commission will not be accepted.
TID
reserves at all times the absolute right to determine whether the applicant's
way of participation is acceptable under the EMF.
Regular trade fairs, say annual or quarterly exhibitions, held in different period of time will be regarded as individual and separate activities. An SME may submit more than one application.
The maximum cumulative amount of grant that an SME may obtain from the EMF is $150,000. For each successful application, the maximum amount of grant is 50% of the total approved expenditures incurred by the applicant or $50,000, whichever is the less.
Applicant should submit the application for grant within 60 calendar days after the completion date of the concerned activity or the issue date of the trade publication containing the advertisement or the commencement date when the advertisement is put on the eligible trade website. Application can be submitted either in person or by post to SME Export Marketing Fund Unit, 4/F, Trade and Industry Department Tower, 700 Nathan Road, Kowloon. Please refer to the application guide for details of the application procedures and related documentary requirements.
If there is no publication date printed on the trade publication or the publisher does not inform TID of the publication date, the first day of the issue month or quarter of the trade publication will be taken as the publication date. The TID reserves all times the absolute right to determine the publication date.
TID will not accept amendments which shall constitute the original application null and void. Likewise, amendments which are tantamount to the acceptance of a fresh application are not acceptable. (e.g. change of business name, BR number and activity name, etc)
An applicant wishes to cancel its application should submit a written request to the TID to cancel its application. The application number (if available), the BR number and details of the activity (e.g. name and date) should be provided in request to facilitate the processing of the concerned application and to avoid any confusion.
Under normal circumstances, TID will complete the processing of the application within 30 clear working days from the date of the receipt of the duly completed application accompanied by all necessary documentation. Applicants are therefore reminded to ensure that applications are submitted together with all required supporting documents. Failure to do so may cause delay in processing their applications or even resulting in deferment or rejection of applications.
TID will then notify the applicant by post of the result of application with all original receipts returned. TID will arrange to send the result and the original receipts through ordinary post to the latest available address at the own risk of the applicant. Successful applicants will at the same time receive grants offered by cheques payable to them.
Late submissions will not be accepted under all circumstances. For this purpose, TID will base on the date the application is received and the end date of the relevant activity or the issue date of the trade publication containing the advertisement or the commencement date when the advertisement is put on the eligible trade website to determine whether the application is late. Local time will be used for all purposes regardless of whether time zone difference is involved for non-local events.
TID will base on the date the application is received and the end date of the relevant activity to determine whether the application is late. Applicants are reminded that for applications and supporting documents sent in by post, TID will not accept the responsibility for any delay and loss or damage of documents in transit. Applicants should take note of the lead-time required and the risk involved for submitting applications and supporting documents by post. In case the deadline for submission falls under Saturdays, Sundays and public holidays, applicants should ensure that their submissions are properly received by TID on the working day immediately before the due date; otherwise the submissions will be regarded as late. Moreover, local time will be used for all purposes regardless of whether time zone difference is involved for non-local events.
Incomplete applications will be deferred. TID will also require applicants to provide supplementary information or clarification by a specified date. Failure to do so by the specified deadline will constitute the applications null and void. TID may reject the long expired applications without further notice.
Only fee for production of brochure bearing names of the applicant and the concerned activity which are solely for use in the said activity is fundable under the EMF. If necessary, TID will require the applicant to provide such sample for examination purpose so as to determine whether the involved advertising fee is fundable. TID may exclude those advertising expenditure as fundable item in case the applicant fails to demonstrate that the material is solely for use in the concerned activity.
Mandatory Provident Fund (MPF) records issued by the trustees will normally suffice. Other documentary evidence (e.g. Employers: business registration and/or company registration records; Employees: salary records and/or employment contracts) will be required if they are under the exemption of the MPF.
For sole proprietorship, please provide the owner's name and other required information. In the case of partnership, please provide the required information of all the partners. For a limited company, please provide information of the individuals having 30% and/or more share holdings. If there is no individual having 30% and/or more share holdings of a company, please provide information of its directors. Applicants also need to submit documentary evidence in this regard {e.g. Certified Extract/Electronic Extract of Information on the Business Register [i.e. Form 1(a) of the BR Office] or Annual Return of the Companies Registry (i.e. Form AR1), etc}.
To ensure the proper use of public money, TID will review applications if deemed necessary. Applicants will thus be required to provide additional documentary evidence. TID will contact other third parties including the organisers of the relevant export promotion activities and the MPF trustees to verify the authentication of the information given. Failure to provide the required information may render the application being rejected.
Applications will be processed on a first-come-first-served basis according to the time and date of receipt of a complete and valid application by TID until the fund available has been exhausted. TID reserves the right to determine the priority order of each application.
No. One application form can only be used to apply for one advertisement under all circumstances. If an advertisement is printed on several issues of the same trade publication, applicant should submit an application for grant within 60 calendar days after the publication date of each issue, together with the supporting documents and original copy of the relevant trade publication, to SME Export Marketing Fund Unit, 4/F, Trade and Industry Department Tower, 700 Nathan Road, Kowloon.
Yes, applicants must show Hong Kong contact information (including address, telephone number and fax number) on the advertisement. Failure to comply with this condition will lead to rejection of the application concerned.
SME Development Fund
General
The SDF is a Government fund provided to non-profit-distributing organizations to implement projects which aim to enhance the competitiveness of Hong Kong’s small and medium enterprises (SMEs) in general or in specific sectors. The SDF is administered by Trade and Industry Department (TID).
Eligibility
Non-profit-distributing organizations are eligible to apply. These organizations may operate as support organizations, trade and industrial organizations, professional bodies or research institutes that are either statutory organizations or organizations registered under the laws of the Hong Kong Special Administrative Region.
Non-profit-distributing organizations refer to those organizations which do not distribute profit to their directors, shareholders, employees or any other persons. When applying for SDF, an Applicant has to declare in the application form that it has not distributed any profit generated by the Applicant in the past to any of its directors, shareholders, employees, or any other persons. The Applicant should provide supplementary information, such as the Memorandum and Articles of Association, to prove that the organization is non-profit-distributing in nature.
Yes, an organization registered under the Societies Ordinance (Cap 151) is eligible to apply for the SDF. The Applicant should provide supplementary information, such as Constitution or Articles of Association, to prove that the organization is non-profit-distributing in nature.
Applicants are required to submit a proposal of the project, including the implementation plan, before commencement of the project. Projects which have already started will unlikely be considered.
No, projects which have already received other public funding support will not be considered by the SDF Secretariat.
The Government has set up different funding schemes with different objectives. Projects rejected by other Government funding schemes can apply for SDF as long as the proposals can meet the objective and requirements of SDF. However, Applicants are required to disclose in the application form that they have previously sought funding support from other public funding sources on the same proposal.
No, SDF only allows one Applicant for each application. The Applicant must be a statutory organization or an organization registered under ordinance(s) of the Hong Kong Special Administrative Region.
An Implementation Agent is responsible for carrying out the details of the projects according to the project proposal. There is no specific requirement on an Implementation Agent but there should be evidence to show that it has the capability to conduct the project effectively. It need not be a statutory organization or a non-profit-distributing organization. There can be more than one Implementation Agent in a project.
Collaborating Organizations in SDF projects are organizations which have agreed to assist the Applicants in providing support to the projects, such as promoting the projects and the results to SMEs. There can be more than one Collaborating Organization in a project.
Yes, as long as the Applicant can demonstrate its ability to implement the project effectively.
Applicants can submit proposals on topics which have been approved under SDF in the past. The Vetting Committee will consider the content, new features and added-value of the proposal to decide if approval is justified.
The SDF aims to enhance the competitiveness of Hong Kong’s SMEs. The SDF does not specify the location of establishments of the Hong Kong SMEs. As long as an Applicant can demonstrate that the result of a proposal can meet SDF’s objective i.e. to benefit Hong Kong SMEs in general or in specific sectors, the application will be considered.
Types of Projects
All proposals that are conducive to enhancing the competitiveness of Hong Kong’s SMEs in general or in specific sectors are welcome to apply. Examples of the nature and content of the proposals include seminars, workshops, conferences, exhibitions, research studies, award schemes, codes of best practice, databases, service centres, support facilities and technology demonstration, etc.
There is no specific requirement on the number of beneficiaries as the number may vary according to the nature of different projects. As a general rule, it is considered more cost-effective if more SMEs can benefit from a project.
Budget, Grant and Contributions
Applicants should exercise frugality and economy in preparing their budget. Where practicable, they should contribute their existing resources and maximize the input from their own organizations and try to obtain private sponsorship. Applicants are required to ensure that all expenditure are used in a cost-effective manner and each expenditure item is well justified.
Expenditure eligible for funding support include: costs directly incurred for implementing the project, such as those for additional manpower and equipment, venue, consumables, external consultancy, production of project deliverables, promotion of project results, etc. On the other hand, overhead expenses such as costs for office rental/renovation, utility, entertainment, meals and other administration cost will not be funded by the SDF.
The maximum amount of funding support for each approved project is HK$2 million, or 90% of the approved project expenditure, whichever is the less. The Applicant has to contribute the remaining 10% of the project expenditure, which may be in cash, in kind or in the form of sponsorship.
An applicant is required to contribute at least 10% of the project cost. Contributions could be in cash, in kind or in the form of third-party sponsorship. For example, if a publisher offers free service (which costs $10,000 in the market) to an Applicant for the printing of an event brochure, this amount can be counted as part of the Applicant’s contributions to the project. Documentary proof of the market value of such service is required.
Application
Applications are accepted all year round but they will be considered by a Vetting Committee on a quarterly basis. Meetings of the Vetting Committee are usually held in March, June, September and December each year. Each organization may submit a maximum of two applications within a quarter.
No application fee is charged.
The required documents include:
If necessary, the following document may be required:
The completed application form together with the required supporting documents should be submitted to the SDF Secretariat, Trade and Industry Department in person, by post or by electronic means.
A rejected application may be resubmitted only if the content has been revised to address the queries or comments made by the Vetting Committee in its previous assessment. A resubmitted application is treated as a new application and will go through the same assessment procedures.
Vetting
A Vetting Committee comprised of experts and representatives from different discipline and sectors of the industry is responsible for giving recommendations to the Director-General of Trade and Industry (DGTI) on matters relating to the assessment of applications and the monitoring of funded projects under the SDF. After receipt of an application, the SDF Secretariat will conduct a preliminary assessment. All applications will be passed to the Vetting Committee and members will examine each application. Where necessary, comments and advice will be sought from other relevant experts.
The Vetting Committee usually meets in March, June, September and December each year.
Applicants will be informed of the outcome after the Vetting Committee has made the decision. The SDF Secretariat will notify the Applicant of the assessment result in writing. If an application is rejected, the SDF Secretariat will inform the Applicant about the reason behind the decision.
All applications will be assessed according to its relevancy and usefulness to Hong Kong’s SMEs, its cost-effectiveness, the project implementation plan, etc. Details of the vetting criteria are set out in paragraph 3.3 of the SDF Guide.
Implementation of the Project
Before commencement of the project, a successful applicant is required to sign an Agreement with the Government and comply with all the terms and conditions set out in the Agreement, the SDF Guide and the instructions and correspondences issued by DGTI from time to time. The Agreement will cover any additional obligations and responsibilities applicable to the Applicant, the payment of the grant, treatment of intellectual property rights, governing law, indemnity, conflict of interest and confidentiality, etc. To facilitate monitoring and evaluation of approved projects, Applicants will also need to submit progress/final reports and financial reports. Please refer to the SDF Guide for details.
The SDF will not provide additional grant to an approved project after signing the Project Agreement. The Applicant is required to pay for any over expenditure of the project.
Such transfer is allowed if the actual expenditure does not exceed 20% of the approved budget for that budget item. DGTI’s prior written approval is required if the actual expenditure in an individual item exceeds 20% of the approved budget for that item. In no case should such transfers increase the total budget.
All intellectual property rights in the Project Result (other than the Third Party Materials) and the works created in respect of or during the course of the Project shall be and remain vested in the Grantee immediately upon creation.