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The purpose of the loan scheme is to assist small to medium sized businesses of up to 50 full-time-equivalent employees.

Meaning of commonly owned group

A commonly owned group of businesses is (generally) considered to be one where each business has the same combination of owners. It does not matter whether those owners have the same proportion of ownership in each business.

In addition, a business may also be treated as being in a commonly owned group if it is in substance part of a larger group of businesses. For example, this may occur where:

  • The group has a dominating shareholder or group of shareholders and the businesses operate together as if they were one.
  • The group of businesses involves a complex ownership structure where the overall control is centralised, and the businesses are in substance one enterprise.

We ask loan applicants to evaluate this requirement honestly and in good faith, on the basis that the loan scheme has been designed to assist small to medium sized businesses and is not intended to benefit large businesses or organisations, which control multiple small to medium sized businesses or organisations.

Entitlement for commonly owned groups

Where a commonly owned group of businesses and organisations collectively have no more than 50 full-time-equivalent employees, each business or organisation will be entitled to apply for a loan based on the number of employees employed by each individual business.

Where a commonly owned group of businesses and organisations collectively have more than 50 full-time-equivalent employees, none of the businesses in the group will be eligible for a loan.

Where a business or businesses which are in substance part of a larger group receive loans in contravention of the policy intent, the Commissioner may reconsider their eligibility for the loans and may ask the businesses to repay the loan amounts early.

Eligible companies

David and Brandon are brothers and are the shareholders in two companies. Each company operates a burger business. Each business employs 15 full-time-equivalent employees.

David is a 60% shareholder in each company and Brandon is a 40% shareholder in each company.

The two companies are eligible for a Small Business Cash Flow Loan because they both have the same owners and, collectively, the companies have less than 50 full-time-equivalent employees.

Ineligible companies

Sabrina is the sole shareholder in two companies. Each company operates a bakery business. Each business employs 30 full-time-equivalent employees.

The two companies are not eligible for a Small Business Cash Flow Loan because they both have the same owner and, collectively, the companies have more than 50 full-time-equivalent employees.

Sabrina cannot choose to apply for only one of her companies in order to receive the loan – all companies within the commonly owned group must be considered.

Different shareholding

Rebekah and Naomi are sisters and are the shareholders in two companies. Each company operates a plumbing business. Each business employs 40 full-time-equivalent employees.

Rebekah is a 80% shareholder in company A and 20% shareholder in company B. Naomi is a 20% shareholder in company A and 80% shareholder in company B.

The two companies are not eligible for a Small Business Cash Flow Loan because they have the same owners and, collectively, the entities have more than 50 full-time-equivalent employees.

Partnerships and companies

Emma and Rachel are equal partners in a law partnership, which has 20 full-time-equivalent employees. Emma and Rachel are also 25:75 shareholders in a company that operates a real estate business and has 25 full-time-equivalent employees.

Both the law partnership and the real estate company are eligible for a Small Business Cash Flow Loan because they both have the same owners and combined have no more than 50 full-time-equivalent employees.

If combined the full-time-equivalent employees is more than 50, neither the partnership nor the company would be entitled to the loan.