The European Commission has adopted a second amendment to extend the scope of the State aid Temporary Framework adopted on 19 March 2020 to enable Member States to support the economy in the context of the coronavirus outbreak.
This follows a first amendment adopted on 3 April 2020. This second amendment complements the types of measures already covered by the Temporary Framework and existing State aid rules, by setting out criteria based on which Member States can provide recapitalisations and subordinated debt to companies in need, whilst protecting the level playing field in the EU.
The amended Temporary Framework will be in place until the end of December 2020. As solvency issues may materialise only at a later stage as this crisis evolves, for recapitalisation measures only the Commission has extended this period until the end of June 2021. With a view to ensuring legal certainty, the Commission will assess before these dates if they need to be extended.
Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “We continue to work closely with Member States to ensure that European businesses have access to urgently needed liquidity. Our rules now also enable such support through subordinated debt. As the crisis evolves, many businesses will also need capital to stay afloat.
If Member States decide to step in, we will apply today’s rules to ensure that taxpayers are sufficiently remunerated and their support comes with strings attached, including a ban on dividends, bonus payments as well as further measures to limit distortions of competition.
And for public transparency, large companies also have to report on the use of aid received and compliance with their responsibilities linked to the green and digital transitions. Because we have to uphold European values and the need for a level playing field to be able to bounce back strongly from this crisis.
That’s also why much more is needed than State aid control. We need a European recovery plan that is green and digital and to the benefit of all European consumers. That’s in the interest of all of Europe – to make sure that this global symmetric crisis does not transform into an asymmetric shock to the detriment of Member States with less possibility to help their industry and the EU’s competitiveness as a whole.”
Arianna Podesta –