To enhance clarity and amplify the leverage effects of incentives, Minister of economy in Wallonia, Willy Borsus, has taken substantial steps towards revamping the investment support mechanism by developing a points-based quality assessment system.
From March 2024 onwards, this mechanism will be implemented to assess whether an investment project is eligible for the investment aid.
Current practise
The investment aid is granted by Wallonia to companies who are investing in their current or upcoming branch in the Walloon region. The premium consists of a percentage of the investment amount, which depends on the company’s size and localisation, the nature of the investments, and the potential job creation. Currently, the aid is granted only on the basis of a list of eligible sectors.
Foreseen changes in the investment support mechanism
The reform aims to develop a system that is more selective whereby the quality and relevance of the supported projects can be ensured. There are three main changes to the investment support mechanism:
1. Points-based quality assessment system
One of the major changes to come into play is the introduction of a two-step points-based system. First, a qualitative assessment of the investment project on the 3 dimensions of the triple transition – 1) economy; 2) employment; 3) environment – will be conducted. Based on the assessment, businesses receive a score out of 100 points. To be eligible for funding, obtaining a minimum score of 50 points is required. The point-based system puts more weight to the economic criteria, followed by employment and lastly, the environment.
Once the qualitative assessment is completed and the minimum score obtained, the company can increase the funding percentage of eligible costs thanks to various bonus criteria. For instance, bonuses will be granted to SMEs located in development zones and for creating jobs, for new activities on a site to be redeveloped, or for international development.
2. Fast-track application process
Besides the points-based system, the reform will establish a Fast-Track application process for very small businesses and independents. For investment projects reaching a maximum of € 100k, these entities can request funding in a more straightforward way, without going through the points-based system and obtain funding at a fixed rate of 10% of the eligible costs.
3. More emphasis on energy usage
The reform will also aim to reinforce the production of renewable energy and the improvement of energy efficiency by increasing aid for those projects and by updating and broadening the list of eligible expenses.
Closing remark
If you want to know more about investment incentives in Wallonia and the novelties planned for next year, please reach out to Tom Wallyn (tom.wallyn@pwc.com), Bart Wyns (bart.wyns@pwc.com) and Willem Gruyters (willem.gruyters@pwc.com). We are happy to support you every step of the way!
