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Concerted Temporary Action Program for Businesses

 

Update – July 13, 2021

 

Applications for financial assistance under the Concerted Temporary Action Program for Businesses (PACTE) must be submitted within at most four weeks after the public health emergency is lifted.

 

Under the Assistance for Businesses in Regions on Maximum Alert (AERAM) component, only applications for increased financial assistance may be accepted up to four weeks after the end of the public health emergency. The period for submitting new applications for the AERAM component is over, since these applications had to be received at most four weeks after the resumption of operations in the economic sectors subject to a closure order.

 

In addition, businesses in the tourism sector may file their applications under the Tourism component of the program up to four weeks after the later of the following dates:

 

  • The lifting of the public health emergency;
  • The complete opening of the Canada–U.S. border.

For businesses whose liquidity is affected by the repercussions of COVID-19

This emergency funding measure provides ad-hoc and exceptional support for businesses affected by the repercussions of COVID-19.

Eligible Businesses

This financial assistance is available to businesses operating in Québec, including cooperatives and other social economy enterprises with commercial activities. Eligible businesses are those that find themselves in a precarious situation and temporary difficulty as a result of COVID-19. They must show that their financial structure offers realistic prospects for profitability. Businesses must not be under the protection of the Companies’ Creditors Arrangement Act or the Bankruptcy and Insolvency Act. 

Eligible Projects

Businesses must show that their cash flow issues are temporary and that the liquidity shortage stems from:

 

  • A problem involving the supply of raw materials or products (goods or services)
  • An inability, or a substantially decreased ability, to deliver goods, products or services

Applications will be reviewed on a case-by-case basis, according to the business’s circumstances and Investissement Québec’s management practices.

AERAM (Assistance for Businesses in Regions on Maximum Alert) – Specific conditions for businesses located in a red zone and subject to a closure order

 

AERAM was created to support businesses that must partially or completely discontinue operations because they are located in
maximum-alert regions (red zones).

 

For more details and to see all sectors of economic activity subject to a closure order, click here Open a new window.

 

The loan beneficiary can be the establishment’s owner or a tenant occupying a commercial space.

 

Applications for financial assistance under the AERAM component must be filed at the latest within four weeks after the resumption of business operations in an economic sector subject to a closure order.

 

The period for submitting new applications is over.

Special conditions for the tourism industry

 

Applications for financial assistance (including increases) may be filed up to four weeks after the later of the following dates:

 

  • The lifting of the public health emergency;
  • The complete opening of the Canada–U.S. border.

 

To be eligible, tourism industry businesses* must be registered on the Bonjour Québec Open a new windowwebsite.

 

Tourism industry businesses are eligible, except for:

 

  • Accommodation establishments with one to three bedrooms
  • Bed and breakfasts with three bedrooms or fewer and the
    non-commercial portion of bed-and-breakfasts with four or more bedrooms
  • Casinos and games of chance
  • Condotels
  • Corporations, tourism offices, municipalities and associations
  • Festivals and events
  • Food service businesses
  • Industrial visits
  • Municipal, paramunicipal, regional, provincial and federal government bodies
  • Teaching institutions
  • Tourist homes and businesses renting out one to three tourist homes
  • Theatres and performance venues

 

* Travel agencies do not have to be registered with Bonjour Québec. However, only travel agencies that are registered on the website of the Office de la protection du consommateur Open a new windowand hold a “general,” “restricted” (adventure tourism travel organizer) or “restricted” (outfitter) travel agent permit are eligible.

 

Eligible Industries

All industries are eligible, except for the following:

 

  • Any activity whose main purpose is protected by the Canadian Charter of Rights and Freedoms (religion, politics, human rights advocacy, etc.)
  • Any form of sexual exploitation, such as strip bars, escort agencies, brothels, erotic massage parlours and swingers’ clubs
  • Any other activity that may offend public morals
  • Games of chance and gambling (video lottery operations), combat sports, racing and other similar activities
  • Production and sale of tobacco and drugs along with services related to their use, except for projects involving pharmaceutical-grade products approved by Health Canada and having a DIN, or their ingredients, as well as R&D projects licensed by Health Canada
  • Weapons manufacturing and distribution

Details of financial assistance

  • A loan guarantee is the preferred form of financial assistance in all cases. Assistance can also take the form of a loan from Investissement Québec.
  • Investissement Québec aims to work in close cooperation with financial institutions and federal authorities in order to share risks.
  • For a line of credit guarantee, the guarantee is applicable only in the following specific conditions:
    • New lines of credit
    • Increases to existing lines of credit. In such cases, Investissement Québec guarantees only the portion corresponding to the increase, based on the agreed-upon guarantee rate.
  • The minimum funding amount is $50,000. For eligible businesses in the tourism industry, there is no minimum amount of funding, except for eligible travel agencies and bed and breakfasts, for which the minimum amount is $50,000.
  • This measure is designed to shore up the business’s working capital.

 

Special conditions may apply.

AERAM (Assistance for Businesses in Regions on Maximum Alert) – Specific conditions for businesses located in a red zone and subject to a closure order

 

  • Twelve-month moratorium on principal repayment, and interest can be capitalized for up to 12 months.
  • Amortization of up to 36 months (excluding the moratorium period on principal and interest repayments).
  • Loan based on working capital needs, which must be limited to a period ending no later than June 30, 2021 (in exceptional cases, ending September 30, 2021, or for a maximum of 12 months).
  • Eligibility for loan forgiveness, which takes effect after the principal repayment moratorium, is determined as follows: a sum equal to 100% of eligible building leasing or ownership expenses, up to a maximum of $15,000 a month, during the period in which establishments in red zones are closed, up to a maximum of 80% of the total of the loan.
  • Expenses eligible for forgiveness are the portion not covered by any other government program related to:
    • School and municipal taxes
    • Rent
    • Mortgage interest paid
    • Charges for utilities such as electricity and gas
    • Insurance
    • Telecommunication charges
    • Permit and association fees
  • Businesses will qualify for enhanced assistance for a given month if they were ordered to close to protect public health for at least 10 days in that month. Because of the exceptional nature of the situation, the closure period is at least 7 days for February and March 2021

 

Hotels with food service operations involving kitchens, dining rooms and reception (or banquet) rooms can qualify for AERAM on top of assistance granted to the tourism industry under the PACTE tourism program.

 

Other conditions may apply.

 

Enhancement for the resumption of operations

 

In order to facilitate a return to normal, businesses eligible for AERAM will qualify for additional assistance under the PACTE program.

 

This additional support is equivalent to one or two more months of eligibility for forgiveness, in addition to the preceding months, and covering up to 100% of the financial assistance granted.

 

For businesses that remained closed for 90 days or less

 

The maximum additional amount that can be paid is $15,000 per establishment. This additional support should cover fixed costs disbursed in the month following the reopening of the business concerned.

 

For businesses that remained closed for more than 90 days

 

The maximum additional amount that can be paid is $30,000 per establishment, that is, $15,000 per month. This additional support must cover the fixed costs disbursed in the two months following the reopening of the business.

Specific Conditions for the Tourism Industry

 

 

  • Maximum 24-month moratorium on principal repayment, and interest can be capitalized for up to 24 months.
  • Amortization of up to 96 months (excluding the moratorium period on principal and interest repayments).
  • Businesses must demonstrate that they were profitable prior to the COVID-19 pandemic.
  • The loan is eligible for partial forgiveness, as follows: 40% of the total amount (principal and interest) repaid by the end of the 48th month (from the time repayment begins), up to a maximum of $250,000 per establishment.
  • Energy expenses incurred monthly between January 1, 2021 and June 30, 2021 can be forgiven under the following conditions:
    • The maximum monthly amount that can be claimed is $35,000, or a maximum of $210,000 per eligible establishment;
    • Only the portion not claimed under any other government program is eligible.

Learn More

Should you have any general questions about the Concerted Temporary Action Program for Businesses (PACTE), contact our call centre at
1-844-474-6367.

 

Our customer service centre will be pleased to provide you with more information about the program.

 

Please note, however, that in light of the COVID-19 situation, your financial institution is in the best position to assess the options applicable to your business. You should therefore contact your account manager at your financial institution first. This is a key step and involves working with your account manager to identify the relief measures to which you may be entitled (such as the moratorium on principal payment) in regard to your cash flow.

 

However, if your business is located in a red zone and has been ordered to close, please contact our call centre at 1-844 474-6367.

 

For any other situation

For any other specific questions regarding financing that you are already receiving from Investissement Québec, please contact your IQ account manager directly. To find your account manager’s contact information, please refer to our online directory.

 

July 2021

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