The European Commission has approved an approximately €60 million (HUF 21 billion) Hungarian scheme to support micro, small and medium sized enterprises (“SMEs”) affected by the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020 and 8 May 2020.
The aim of the measure is to ensure that micro companies and SMEs affected by the coronavirus outbreak have sufficient liquidity to cover their immediate working capital and investment needs by facilitating access to loans. The support will take the form of direct grants intended to cover part of the financial costs (interests and handling fees) incurred by micro companied and SMEs in relation to certain loans granted until 31 December 2020.
The aid will be channelled through credit institutions. The Hungarian authorities expect that up to 6,000 micro companies and SMEs will be able to benefit from the scheme. The Commission found that the Hungarian measure is in line with the conditions set out in the Temporary Framework.
In particular, the direct grants shall not exceed €100,000 per company active in the primary production of agriculture products, €120,000 per company active in the fishery and aquaculture sector, and €800,000 per company active in other sectors. Furthermore, the measure contains safeguards to ensure that the aid is effectively passed-on by the credit institutions to the beneficiaries in need.
The Commission concluded that the measure is 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, Commission approved the measure under EU State aid rules.
More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.57285 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.
Arianna Podesta –