(19 March 2020) – The European Commission prepared a temporary framework to fast-track state aid approval as a response to the coronavirus, last used in the aftermath of the financial crisis in 2008.
The EU executive said on Tuesday (17 March) that it has sent member states a proposal for a state aid temporary framework based on Article 107 of the EU treaties, which can be activated to remedy “a serious disturbance across the EU economy”.
The new regime will allow national governments to offer public support to companies, especially SMEs, without Brussels’ blessing under certain conditions.
The framework will allow national governments to offer direct grants (or tax advantages) of up to €500,000 to a company, provide subsidised state guarantees on bank loans, enable public and private soft loans, and transfer cash to banks so they can channel it to SMEs.