Sub-component of the component for basic means of the preferential agro-credit - for financing of arrangement of cattle stalls

1. Within the sub-component, loans are issued for financing of the arrangement of cattle stalls.

2. The following persons can use the sub-component: 

a) An individual entrepreneur registered according to the legislation of Georgia; 

b) A Legal entity registered according to the legislation of Georgia (except the state/municipal enterprises). 

3. The total amount of loan(s) granted to one beneficiary within the sub-component should not be less than 20,000 (twenty thousand) GEL and should not exceed 1,000,000 (one million) GEL.

4. For a potential beneficiary to benefit from a subcomponent, it must satisfy the prerequisites for granting such type of loans by the financial institution and the requirements of the present project. In addition, the land plot, on which is planned implementation of the purpose. Should be in ownership or use of the borrower according to the legislation of Georgia (in the case of co-ownership, there must be the consent of the co-owner (co-owners) regarding the use of the property during the co-financing period of the loan, and in case od use, its effectiveness term should not be the less than the loan co-financing amount). 

5. The beneficiary is obliged: 

a) To arrange the infrastructure necessary for not less than 100 adolescent cattle (link of the criteria); 

b) During the period of co-financing of the loan, to maintain the corresponding liquidity of the loan volume (not more than 1,500 GEL for per soul) (in case of slaughter or fall, the beneficiary must provide replacement);

c) To ensure building/reconstruction/equipping of closed or open type of farms, also satisfaction of the farm criteria;  

d) To provide a recommendation from the municipality with regard to the location of the farm, with consideration of the distance from the settlement;

e) To ensure implementation of the waste management system, including the arrangement of the manure utilization system;

f) To ensure consideration of animal health and well-being, production hygiene and food safety requirements in accordance with the legislation of Georgia; 

g) In the case of an operating farm, to ensure that at the statement submission moment the operation farm be registered as a business operator and belonged cattle be registered in Animals Identification and Traceability System of Georgia (NAITS). 

6. Loan amount for per soul with calculation is not more than 1,500  GEL.

7. The beneficiary is obliged, (except the refinanced loan) to ensure  total spending of the tranche during 6 (six) months after receive of each tranche (any purchase implemented with the loan amount (except the service) should be implemented by the entrepreneur physical/legal entity registered under the rule defined by the legislation of Georgia or through import) for confirmation of performance of the loan purpose to submit the audit report in the financial institution during the next 7 (seven) months after issuing of the loan or its tranche. If in the mentioned term the beneficiary does not submit the audit report, agency will cancel co-financing to the beneficiary, and after expiration of 12 (twelve) months co-financing by the agency will be terminated. 

8. For the loans issued within the component the agency is authorized, to review the issue of changing the terms defined by 7th clause. 

9. Within the sub-component the loan(s) are issued for arrangement of the animals for the following purpose: 

a) For financing of building/reconstruction of closed or open type farms; 

b) Equipping of the farm/technique; 

c) Arrangement of the well or/and the appropriate water supply system;

d)  Arrangement of the food storing building. 

i) Financing of arrangement of infrastructure of the internal territory necessary for functioning of cattle farm; 

10. Interest rate of the credit is defined according to its volume. Interest rate of the credit may be fixed or floating: 

a) In case of fixed interest rate, the following annual interest rates should be defined by the financial institution: 

b) In case of floating (variable) interest rate, the following annual interest rates should be defined by the financial institution: 

11. Participation of the agency: 

The agency will co-finance the interest rate of not more than 48 months in parallel with the amount paid by the borrower (if any), in the amount of 11% of the basic amount of the loan, not more than 50 months after the loan or its first tranche is issued.  

12. Targeted area of the component are all municipalities of Georgia, except the self-governing cities. 

13. Procedure for issuing a loan. 

13.1 Commercial bank, before issuing the loan, in advance in written will notify the following data to the agency: 

The terms and parameters of the approved loan, including: 

• Name of the beneficiary; 
• Identification number; 
• Loan amount; 
• Loan term (in months);
• Purpose of the loan in details; 

13.2 The letter should be accompanied with the following documentation: 

• In case of building a new farm - LEPL – the reference about compliance of the horned cattle with the farm project criteria issued by scientific - research center of agriculture and also, recommendation from municipality about placement location of the farm, with consideration of the distance from the settlement. 
• In case of reconstruction of existed farm - the reference about existed state of the cattle farm issued by LEPL National Food Agency and the reference about the compliance of the cattle farm reconstruction project and the existing conditions of the farm described in the reference issued by the LEPL National Food Agency. Also, the document confirming of registration of cattle (if any) in Animals Identification and Traceability National System (NAITS) and the document confirming of registration as the farm business operator. 

13.3 Commercial bank is authorized to issue an approved loan only after confirmation of relevance with the program conditions by the agency.