The European Commission has found two Spanish guarantee schemes for companies and self-employed workers affected by the coronavirus outbreak to be in line with EU State aid rules. The schemes, with a total budget of approximately €20 billion, were approved under the State aid Temporary Framework to support the economy in the context of the COVID-19 outbreak adopted by the Commission on 19 March 2020.
Spain notified to the Commission under the Temporary Framework two guarantee schemes on new loans and refinancing operations for
- self-employed workers and small and medium-sized enterprises (SMEs); and
- larger companies, all affected by the coronavirus outbreak. The schemes have a total budget of approximately €20 billion.
The guarantee measures aim at limiting the risks associated with issuing operating loans to companies that are severely affected by the economic impact of the coronavirus outbreak. The objective of the measures is to ensure that these companies have liquidity to help them safeguard jobs and continue their activities faced with the difficult situation caused by the coronavirus outbreak.
The Commission found that the Spanish measures are in line with the conditions set out in the Temporary Framework. In particular, they cover guarantees on operating loans with limited maturity and size. They also limit the risk taken by the State to a maximum of 80% for self-employed workers and SMEs and 70% for larger enterprises. This ensures that support is swiftly available at favourable conditions and limited to those who need it in this unprecedented situation. To achieve this goal, the measures also involve minimum remuneration and safeguards to ensure that the aid is effectively channelled by the banks or other financial institutions to the beneficiaries in need.
The Commission concluded that the Spanish guarantee schemes for companies and self-employed workers will contribute to managing the economic impact of the coronavirus outbreak in Spain. The measures are necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State, in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. On this basis, the Commission approved the measures under EU State aid rules.
Read the full article here: ec.europa.eu/commission/presscorner/detail/en/ip_20_520