When reviewing grant conditions, circumstances may emerge that relate not directly to the applicant company itself, but to its ownership structure, linked enterprises, or even the property where the project will be implemented.
Let's look at some of the less obvious pitfalls worth checking before preparing an application!
Checking the Applicant Company Alone Is Not Enough
One of the most important, yet often overlooked, elements of an eligibility check is mapping a company's ownership structure and business relationships.
A company is not necessarily an independent economic entity. Through its owners, shareholdings in other companies, or other control relationships, it may form part of a group of companies.
This can have significant implications for grant eligibility. For example, data relating to linked and partner enterprises may affect an applicant's SME classification. A company that appears to be a small enterprise on its own may, when considered together with its related businesses, qualify as a medium-sized or large enterprise.
However, the assessment should not stop at determining company size. The exclusion criteria of some grant calls may also extend to linked enterprises.
For example, an applicant may have sound finances and stable operations, with no proceedings pending against it, while one of its linked enterprises is subject to bankruptcy or liquidation proceedings. If the call's exclusion provisions also apply to that linked enterprise, the applicant's eligibility may be affected.
Enforcement proceedings initiated against a linked enterprise may pose a similar risk. However, certain funding schemes may allow exceptions, for example where an officially approved payment deferral or instalment plan is documented and duly complied with, or where enforcement proceedings have been terminated following the company's fulfilment of its obligations.
This demonstrates why reviewing the applicant's own company register extract and financial data is not sufficient. It may also be necessary to identify ownership links, map the corporate relationships, and examine the legal and financial position of the companies concerned.
Importantly, the scope of exclusion criteria may vary from one grant call to another. It is therefore essential to establish precisely which companies and which proceedings the rules cover.
Leased Property? You Still Need to Check the Land Registry Record!
When selecting a project location, many companies focus primarily on whether the property is large enough, has the necessary infrastructure, and is suitable for the planned activity.
For leased property, however, reviewing the lease agreement alone is not enough.
Encumbrances, rights, and registered notices appearing on the property's land registry record may affect the application even when the applicant does not own the property.
This is particularly important for grant calls requiring a project site free from litigation and third-party claims.
It is therefore advisable to check in advance whether the land registry record contains, for example, an enforcement right, a notice of litigation, a mortgage, or any other registration that could affect project implementation.
The existence of such entries does not automatically result in exclusion in every case, but their compatibility with the requirements of the relevant call must always be assessed.
The term of the lease also matters. If the project site must remain available throughout implementation and the mandatory maintenance period, a lease that is due to expire soon may cause problems. The owner's consent may also be required, and in the case of jointly owned property with undivided ownership shares, the arrangements governing its use may need to be properly documented.
A Project Site Registered Too Late Can Also Be an Obstacle
Even if a property is technically suitable for implementing the development, the date on which the site was registered may be decisive.
Some grant calls require the project location to have been recorded in the company register for a specified period by the date the grant application is submitted.
For example, if the call requires the site to have been registered for at least 60 days, a location registered only a few weeks before submission will not meet this condition.
Applicants may also be required to prove that the site is actually operational, for example by providing utility bills, official permits, or other documents.
The physical characteristics of the site must not be overlooked either. In the case of machinery purchases, for example, it may be necessary to demonstrate that the equipment can be delivered into the property, installed there, and operated as intended.
Site compliance should therefore be checked at the very beginning of project planning, rather than in the final days before submitting the application.
An Outstanding Debt or Previous Grant Can Derail Your Plans
A company's current financial and legal position is also crucial to grant eligibility.
Before submission, it is advisable to check with the company's accountant whether there are any outstanding tax liabilities or enforcement proceedings against the business.
It is important to distinguish between settling a debt and the formal termination of enforcement proceedings. Making a payment does not necessarily mean that the enforcement process has been legally closed. For eligibility purposes, the current status of the proceedings must therefore also be verified.
Grants received in the past may present another, less obvious obstacle.
Some funding schemes may exclude companies that have already received support under particular programmes, or that submitted applications within a specified earlier period. In these cases, it is also necessary to establish precisely which previous event triggers the restriction and whether it applies to the current applicant.
Qualified Staff and Quotations Are More Than Formalities
In addition to checking eligibility, attention must also be paid to the professional and financial justification for the planned project.
For research and development grants, for example, certain positions may require qualifications at a specified level and in a relevant field. If a research role requires a relevant master's degree, several years of professional experience alone may not be sufficient.
The start date of employment may also matter: under some schemes, the employee must already be employed by the applicant when the grant application is submitted.
Proper justification of procurement is equally important. A single quotation is not always sufficient: several comparable offers, detailed technical specifications, justification of quantities, and evidence that costs reflect market prices may be required.
When an external service provider is involved, assessors may also examine whether the bidder has the professional experience, capacity, and resources needed to perform the work.
Thorough Pre-Screening Can Save Time and Money
Checking grant eligibility is therefore far more complex than simply reviewing a company's revenue, employee headcount, and completed financial years.
Ownership links, the legal status of linked enterprises, encumbrances registered against a property, or even a previous grant may all fundamentally affect the funding opportunities available.
That is why thorough preliminary eligibility screening is not merely an administrative step, but one of the most important parts of preparing a successful grant application.
Some problems can still be resolved if identified in time, while other circumstances may rule out participation altogether. The earlier these risks are uncovered, the more options remain for taking the necessary action.
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