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Inception date: 01 Jan 2009 | Removal date: 01 Jan 2011

Loan guarantee

On 9 April 2009, Finland notified a temporary aid scheme for granting limited amounts of compatible aid - State aid No. N 224/2009.
The notified measure is part of a wider package of measures, which are aimed at remedying a serious disturbance in the economy of Finland. To this end, the Finnish authorities are putting into place other measures (guarantee scheme) under the Temporary Framework that are covered by other notifications to the Commission.
The aim of the notified scheme is to grant temporary aid to undertakings that have been affected by a sudden shortage or unavailability of credit as a result of the global financial and economic crisis. It will help to maintain current employment and possibly will help to stimulate the creation of new jobs. The scheme provides for the provision of limited amounts of compatible aid to undertakings until the end of 2010.
The aid will be provided in the form of transparent forms of aid, as defined by the General Block Exemption Regulation, and in particular, in the form of direct grants, loans and interest rate subsidies, guarantees. Aid will be granted in the form of risk capital and capital injections. The aid volume available under this scheme is estimated by the Finnish authorities to be EUR 200-300 million. The aid scheme will be financed through the national budget. The scheme applies to small and medium-sized enterprises and large firms.
The commission found that the measure constitutes State aid within the meaning of Article 87(1) of the EC Treaty and gave the following assessment:
"State resources are involved in the notified scheme since the aid is granted from national state resources and is coordinated by the Finnish Ministry of Employment and the Economy. The measure is selective since it will be granted only to certain firms. The measure conveys an advantage by making available limited amounts of aid which would not be available to the beneficiaries without the measure. The measure affects trade between Member States since the scheme is not limited to beneficiaries which are active in sectors where no intra-community trade exists. The measure distorts or threatens to distort competition." (par. 23-27 of the letter from the EC to Finland - Brussels, 03.06.2009 C(2009)4443 )
Article 87(3)(b) of the EC Treaty enables the Commission to declare aid compatible with the Common Market if it is "to remedy a serious disturbance in the economy of a Member State." This aid has to be applied restrictively and must tackle a disturbance in the entire economy of the Member State according to the interpretation of the Article 87(3)(b) by the Court of First Instance.
The Commission referred to its Communication on the financial crisis (Temporary Framework) and concluded that the Measure complies with the conditions laid therein. Therefore, despite the measure constituting State aid pursuant to the Article 87(1) EC, it is compatible with the Common Market according to the Article 87(3)(b) EC Treaty. The Commission raises no objections against the measure at issue and authorizes it as emergency intervention in the face of the current financial crisis. (par. 29-34 of the letter).
A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.




711 Financial, insurance & pension services, excl. investment banking

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