CARES Act: SBA Issues Guidance for Eligibility of Businesses Owned by Large Companies Under Paycheck Protection Program | Practical Law
On April 23, 2020, the Small Business Administration (SBA) issued further guidance on whether businesses owned by large companies with adequate sources of liquidity to support the business’s ongoing operations qualify for a Paycheck Protection Program (PPP) loan, a program created under Title 1 of the CARES Act. The SBA said that it is unlikely that a public company with substantial market value and access to capital markets will be able to certify in good faith the need for a PPP loan. However, any borrower who applied for a PPP loan prior to the issuance of this guidance and repays the loan in full before May 7, 2020 will be deemed to have made the certification in good faith.