Agroleasing

1. The component  agroleasing serves the development of the agricultural products’ added value generating infrastructure. Preferential agroleasing are benefited by the companies, involved in creation of the agricultural products (modern farms, greenhouse, etc.) or engaged in any form of processing of agricultural products (storage, packaging, recycling), or producing packaging materials for the agricultural products, as well as the companies, which have approved the state co-financing within scopes of the co-financing project.

2. The agroleasing component is financed from the component budget for the “Preferential Agrocredit for Fixed Assets” (it does not apply to the agroleasing to be issued within scopes of the co-financing project).

3. The Agency shall provide with the co-financing of the lease payment part on the basis of the agreement with the lessee.

4. The Agency shall execute the contract with the leasing issuer and determines the leasing eligibility criteria, terms and conditions, which ate to be met by the latter for the Agency's participation.

5. At any stage of the project the Agency shall carry out the monitoring of the preferential agroleasing beneficiary and render the relevant response to any violation.

6. Following persons shall be able to join the preferential agroleasing:

    6.1. Georgian citizen natural person;

    6.2. Individual entrepreneur registered in compliance with the legislation;

    6.3. Entrepreneur legal entity (except for the state/municipal enterprise) registered in compliance with the legislation;

7. In order to take advantage of the preferential agroleasing a potential beneficiary shall meet the preconditions of the issue of that type of leasing by a leasing issuer and the present project requirements.

8. This component shall be allocated for financing of the companies, which are focused on the processing of local raw materials and use the local labor resources. It is prohibited to fund the projects, which are intended only for processing of imported raw materials and use of non-local labor resources.

9. This component provides for financing the equipping new and existing agricultural companies with the equipment and machinery, including:

    9.1. Processing plants:

    9.1.1. Meat, fish and milk processing;

    9.1.2. Alcoholic beverages production;

    9.1.3. Tea, bay leaf production and packing;

    9.1.4. Fruit, vegetable and berry processing;

    9.1.5. Citrus processing;

    9.1.6. Walnuts and hazelnuts, ground hazelnuts and other processing;

    9.1.7. Wool, leather and fur production;

    9.1.8. Vegetable fats (butter, margarine, oil) and halva production;

    9.1.9. Tobacco production;

    9.1.10. Essential oils and spices production;

    9.1.11. Slaughterhouse arrangement;

    9.1.12. Beekeeping processing;

    9.1.13. Agricultural animals, birds and fish food production;

   9.1.14. Grain processing (except for wheat flour production), only in the case of the agroleasing issued within the scopes of the co-financing project;

   9.1.15 Producing Pasta products

9.2. Infrastructural facilities:

   9.2.1. Agricultural products storage warehouses;

   9.2.2. Grain dryers;

   9.2.3. Agricultural product storage refrigerators;

   9.2.4. Production of agricultural products packaging materials;

   9.2.5 Production of oak barrels for alcoholic beverage;

   9.2.6. Pitchers production for wine; 

9.3. Primary agricultural companies:

   9.3.1. Livestock farming;

   9.3.2. Poultry farm;

   9.3.3. Poultry incubation farms;

   9.3.4. Farm of animals with valuable fur;

   9.3.5. Greenhouses and other indoor ground production;

   9.3.6. Fish production;

   9.3.7. Beekeeping;

   9.3.8. Seedlings and nurseries;

  9.3.9. Perennial crops orchards, vineyards and other plantations.   

  9.4. Energy efficient enterprises:

  9.4.1. Energy efficient stove production;

  9.4.2. Fuel-producing enterprises for energy-efficient stoves;

10. The leasing issuer can issue a preferential agroleasing for:

   10.1. Importing of new and/or used equipment;

   10.2. Purchase of new equipment of domestic or foreign production in Georgia;

   10.3. Delivery of the used equipment and devices registered in the balance of the leasing issue to the leasing beneficiary, provided that the subject of leasing is not procured from a leasing issuer or its associated person;

11. No leasing of the following types below shall be allowed within the scopes of this component:

   11.1. Land leasing;

   11.2. Leasing of existing agricultural buildings;

  11.3. Leasing of vehicles (except special equipment and trailers, equipment and implements, vehicles integrated with non-stationary technological lines), flying and floating vehicles;

   11.4. Office space leasing;

12. Volume of an investment of a leasing issue per beneficiary shall be not less than 20 000 GEL and not more than 1 500 000 GEL (including the leasing issued within the scopes of the co-financing project); the leasing issue maximum term is not limited.

13. Within the scopes of the preferential agroleasing one project, one beneficiary is allowed to accept several agroleasing. In this case, the total investment of a leasing issuer shall be not less than 20 000 GEL and not more than 1 500 000 GEL;

14. Under the project, it is allowed the simultaneous co-financing of one beneficiary with a preferential agrocredit and a preferential agroleasing, provided that sum total of such leasing (s) and loan (s) must not exceed 1 500 000 GEL.

15. Annual yield of the service provided for in the leasing value shall not exceed 12 % of the leasing issuer’s investment.

16. The Agency’s purposeful co-financing shall be 12% of annual investments of the leasing issuer for 66 months; this amount shall be paid by the Agency to the leasing beneficiary in accordance with the leasing value payment schedule provided for in the contract, after payment of the leasing value;

17. In case of earlier payment of the preferential agroleasing amount in whole or in part within 6 months from the execution of a leasing contract the commission fee for such pre-payment and/or a penalty shall not be more than 4% of the leasing value pre-paid, while after 6 months from the day of execution of the leasing contract the above mentioned amount shall not be more than 2% in case of pre-payment of a preferential agro-leasing in full or in part;

18. In case of earlier redemption of a subject of leasing by the leasing beneficiary the period for preliminary notifying the leasing issuer shall not be more than 30 calendar days;

19. In case of failure to pay a leasing value by the leasing beneficiary within the term provided for in the schedule agreed under the contract the leasing issuer shall be entitled to accrue to the leasing beneficiary a penalty in the amount of not more than 0,1% of the overdue leasing value per each day of delay. Payment of the leasing value shall be made by and between the leasing issuer and the leasing beneficiary in compliance with the rules agreed in this contract;

20. Within the scopes of the preferential agroleasing component, at any stage of the co-financed leasing contract the Agency shall be entitled to monitor the leasing issuer and the leasing beneficiary in order to clarify the fulfillment of the contract conditions by them. In case of reveal of any violation the Agency shall act on the basis of the contract duly executed with the parties;

21. Targeted co-investment in the amount of 12% of annual interest accrued to the investment of the leasing issuer – in compliance with the criteria set forth by the Agency – shall be issued after signing the leasing contract by the leasing issuer and the leasing beneficiary and payment of the leasing value by the leasing beneficiary;

22. In case if a leasing issuer decides to review any of the leasing projects, it can apply to the Agency for the information whether the similar project is being discussed by any other financial institution or a leasing issuer; at the same time it has to notify the Agency about its project, while in case of issue of a leasing within the scopes of the co-financing project it shall be prohibited from issuing a leasing without the Agency’s prior consent;

23. The Agency’s target co-financing shall be terminated in case of occurrence of the following circumstances:

   23.1. Full payment of the leasing value by the leasing beneficiary;

   23.2. The leasing beneficiary’s failure to comply with the obligations provided for in the contract and the project; the target co-financing shall be suspended in case of delay and it shall be terminated in case of the inquiry of the leasing subject by the leasing issuer;

   23.3. In case of a leasing restructuring, if the restructuring results in expansion of the maximal term set forth by the Agency for the leasing and/or increase of the target co-financing amount;

   23.4. The leasing issuer violates the requirements set forth by the Agency. In such case the Agency may charge a penalty to the leasing issuer and to claim compensation for the damages;
   23.5. In case of issuing the agroleasing within the scopes of the co-financing project, the company changes it profile within 2 years from operation of the company. Profile maintenance means complying with the company’s plan envisaged by the relevant business plan;

   23.6. Violation at issuing the leasing. In such case, the leasing issuer shall be charged with a penalty envisaged by the contract.  In addition, the agency makes a decision on termination of financing in compliance with the rules and the procedures established by the Agency;

24. In case of issuing the leasing within the scopes of the co-financing project, for securing the Agency’s claim to the leasing beneficiary the leasing issuer shall transfer the balance amount to the Agency after satisfaction of its claim.

25. In case if the leasing company violates contractual obligations/project terms the Agency – upon the prior written consent of the leasing company shall be entitled to proceed with the realization of the lease subject. To this end, the Agency is authorized to display the information on sale of the subject of leasing in its own (or contractor’s) website and indicate the price priory agreed with the leasing company;

26. In case of issue of a leasing within the scopes of the co-financing project the grace period, shall be:

    26.1. For the service annual interest amount - at least 12 months, if the leasing issuer and leasing beneficiary do not agree otherwise;

    26.2. For the principal amount of the agro-leasing - not less than 24 months, if the leasing issuer and leasing beneficiary do not agree otherwise;

27. No calculation of the sum payable by the leasing issuer shall be allowed during the grace period provided for in the clause 26 above with capitalization rule;

28. In case of issue of a leasing within the scopes of the co-financing project the leasing issuer may additionally require from the leasing beneficiary to submit the security;

29. Parallel loans and/or agroleasing shall be allowed within the scopes of the component or a sub-component. In case of existence of current loan/agroleasing in various currencies the total current balance of all loans by the moment of approval of a new loan/leasing shall not exceed 1 500 000 GEL according to the official rate of the National Bank.