Since implementing the Paycheck Protection Program (PPP) more than a
month ago, the U.S. Small Business Administration (SBA) has issued
confusing guidance that makes multinational companies, particularly
foreign-owned U.S. companies, wonder whether they are eligible.
As we previously noted, the key is the interaction of the affiliate rules
and the limit of 500 employees. These affiliate rules include
both U.S. and foreign affiliates. According to the first Interim
Final Rule announced earlier this year, "You are eligible for
a PPP loan if you have 500 or fewer employees whose principal place
of residence is within the United States." Based on this
guidance, a foreign-owned U.S. company that is part of a large
worldwide affiliate group should be able to qualify if the U.S.
company – the only company that has employees whose principal
place of residence is in the United States – has no more than
500 employees.
