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Don’t Qualify for the CEBA Loan? Check Out the Regional Relief and Recovery Fund


by the Corporate Commercial & Tax Team

Western Economic Diversification Canada is offering funding relief for small and medium sized enterprises (SMEs) that have been impacted by the ongoing COVID-19 pandemic. This program is available to those who are not eligible for the Canadian Emergency Business Account (CEBA). Like the CEBA, the amount received must be used only for business expenses. For example, these funds cannot be used to pay down debts.

Similar to the CEBA, the Regional Relief and Recovery Fund (RRRF) is a program that offers interest-free loans up to $40,000 (called “repayable contributions” for the RRRF). The amount is eligible for a 25% forgiveness if repaid before December 31, 2022. If the loan is not repaid prior to December 31, 2022, then it converts to a 3-year term repayable contribution / loan.

There is a “Community Futures” stream for the RRRF, which is generally intended to SMEs in rural and smaller communities. There is also a “general” stream for the RRRF for those who do not qualify for the Community Futures stream.

Eligibility for the Community Futures stream

To qualify, the business must:

  1. be a SME located in non-metropolitan regions (all areas served by Community Futures organizations) in Western Canada;
  2. must attest they have not received duplicative supports through other federal or provincial government COVID-19 support programming such as the CEBA;
  3. have been viable and not experiencing any liquidity or other financial difficulties as of March 1, 2020;
  4. have experienced a material adverse effect on business operations on or after March 1, 2020 as a result of the COVID-19 pandemic;
  5. have been established before March 1, 2020;
  6. be a sole proprietorship, partnership (except professional services), corporation, social enterprise, or other similar organization.

Eligibility for the General RRRF Stream

To qualify, the business must:

  1. have fewer than 500 full-time employees (FTEs);
  2. be located in British Columbia, Alberta, Saskatchewan or Manitoba;
  3. not be located in an area serviced by a Community Futures (CF) office;
  4. not be eligible for the ‘RRRF – Community Futures Stream’;
  5. have applied and were declined for funding from the CEBA or were not eligible for CEBA funding;
  6. have been operational as of March 1, 2020;
  7. have suffered financially because of the COVID-19 pandemic; and
  8. intend to continue operations in Western Canada.

An example of a business that may qualify is a business that only pays dividends.

Sole proprietorships and not-for-profits do not qualify.

Repayable contribution / loan amount

The amount that you can receive in RRRF is the lesser of:

  1. Estimated total operating balance from April 1, 20202 to Sept. 30, 2020; and
  2. $40,000.

The amount received is included as income in the year received.


Businesses will need to submit a final report with number of jobs maintained due to RRRF, confirmation that the business is continuing its operations, and other metrics as requested.

For more information on the Community Futures, see here. For more information on the general stream RRRF, see here.

McLennan Ross is dedicated to helping you navigate through these difficult times. Our firm offers services in a range of practice areas, including labour & employment, corporate commercial matters, tax litigation and tax planning, and commercial litigation. Please contact our offices for more information.

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