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Covid-19: measures taken in favour of companies

Six measures to support the economy

08/04/2020

In addition to its health emergency plan (see our article "Morocco: the legal framework for a state health emergency"), various measures have been taken to support businesses and help them overcome the crisis.

1. Suspension of tax controls and TDS

Until 30 June 2020.

2. Deferral without formality of the filing of tax returns for companies with a turnover of less than MAD 20 million.

The Business Intelligence Committee has allowed companies whose turnover for fiscal year 2019 is less than MAD 20 million to benefit from a postponement of the filing of tax returns.

The General Tax Department (GTD) provides details in a press release dated March 27, 2020 on this deferral, which must cover the tax return, the additional corporate income tax due for fiscal year 2019 and the first instalment due for the current fiscal year.

3. What about companies whose turnover is equal to or greater than MAD 20 million?

The GTD allows them to request an extension of the above-mentioned deadlines on condition that they request a benevolent measure upon justification from the Ministry in charge of Finance or the person delegated to it for this purpose.

4- Implementation of "DAMANE OXYGENE" for SMEs with a turnover between MAD 200 and 500 million.

On March 26, 2020, the Ministry of the Economy, Finance and Administrative Reform set up a guarantee mechanism "DAMANE OXYGENE" with the Caisse Centrale de Garantie (CCG). This mechanism is intended for SMEs whose turnover is between 200 and 500 million DH and covers 95% of the credit amount and thus allows banks to set up exceptional overdrafts to finance their working capital needs. These bank financings cover up to 3 months of current expenses related to operations (rents, salaries, essential purchases, etc.) and can reach up to MAD 20 million. For the cases of companies that do not have short-term financing lines, this overdraft can reach up to MAD 5 million.

In addition, in order for banks to speed up the processing of financing requests, the CGC has granted a delegation to credit institutions to commit its guarantee for any credit below MAD 2 million.

5- Acceleration of payments by Public Establishments and Enterprises (PEEs) for the benefit of businesses

In order to reduce the pressure on companies' cash flow, a Circular from the Minister of the Economy, Finance and Administrative Reform dated March 26, 2020 recalled the measures of Decree No. 2-16-344 of July 22, 2016 relating to payment deadlines and default interest on public procurement, setting the payment deadline for a public procurement order at 60 days, of which 45 days are required to record the service and 15 to pay for it.  Beyond this period, interest on arrears shall be charged.

6- Recommendations issued by the Moroccan Capital Market Authority (MCMA)

The MCMA recommends to issuers to proceed with their publications via its website and the electronic distribution platforms of the legal gazettes in order to facilitate the communication of information and reminder by the AMMC to publicly traded companies of their obligation of information.

Related people

Picture of Marc Veuillot
Marc Veuillot
Managing Partner
Casablanca