ANNOUNCEMENT 18 Jun 2020

In June 2020, Poland notified the European Commission of their intention to establish an aid scheme for COVID-19 related R&D and investment activities.

NUMBER OF INTERVENTIONS

2

  • 2 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

Letter to the Member States – Poland COVID-19: R&D aid for Covid-19 relevant research and development, investment aid for the construction and upgrade of relevant testing and upscaling infrastructures, and investment aid for investments into production facilities for the production of Covid-19 relevant products. Available at: https://ec.europa.eu/competition/state_aid/cases1/202027/286598_2168965_58_2.pdf

SA.57519 Poland: R&D aid for Covid-19 relevant research and development, investment aid for the construction and upgrade of relevant testing and upscaling infrastructures, and investment aid for investments into production facilities for the production of Covid-19 relevant products. Available at: https://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_57519

Inception date: 18 Jun 2020 | Removal date: 31 Dec 2020

Financial grant

On 15 June 2020, the Polish authorities notified the European Commission of their intention of establishing an aid scheme to fight the COVID-19 outbreak and to support the economy during the COVID-19 outbreak. The Commission approved the scheme on 18 June 2020. The scheme has a total budget of PLN 2 billion (USD 503.5 million) and will be in force until 31 December 2020.

The aid scheme is composed of three sub-schemes. The first one is R&D aid for Covid-19 relevant research and development activities. This sub-scheme has a budget of PLN 650 million (USD 163.6 million). The second sub-scheme is the investment aid for the construction and upgrade of relevant testing and upscaling infrastructures. This sub-scheme has a total budget of PLN 650 million (USD 163.6 million). Finally, the third sub-scheme is investment aid for investments into production facilities for the production of Covid-19 relevant products. This sub-scheme has a total budget of PLN 700 million (USD 176.2 million).

The beneficiaries of the aid scheme are SMEs and large enterprises operating in all sectors except agriculture, fishery and aquaculture sectors, and credit and financial institutions. It is estimated that more than 1000 businesses will benefit from the aid scheme.

All the sub-schemes provide support in the form of direct grants and repayable advances. In the first sub-scheme, the Polish authorities didn’t specify the conditions of aid in the form of direct grants. In the second and third sub-schemes, the investment project shall be completed within six months after the date of the support. When the deadline is respected, aid in the form of repayable advances is transformed into grants. For aid in the form of repayable advances please see the related intervention.

According to the EU Commission: “The measure is liable to distort competition, since it .strengthens the competitive position of its beneficiaries. It also affects trade between Member States, since those beneficiaries are active in sectors in which intra-Union trade exists.”

However, the Commission considers that “…positive effects of the measure outweigh its potential negative effects on competition and trade” and approved the state aid “… on the grounds that it is compatible with the internal market pursuant to Article 107(3)(c) of the Treaty on the Functioning of the European Union.”

The state aid is approved under the Temporary Framework for State aid measures. The European Commission adoption of a Temporary Framework under the State Aid rules of the European Union was adopted on 19 March, see related state act.

 

AFFECTED SECTORS

 
N/A

AFFECTED PRODUCTS

 
N/A
Inception date: 18 Jun 2020 | Removal date: 31 Dec 2020

State loan

On 18 June 2020, the European Commission approved the aid scheme notified by the Polish authorities. The scheme has a PLN 2 billion (USD 503.5 million) total budget and will be effective until 31 December 2020.

Under the aid scheme, there are three sub-measures. The first measure is granted for COVID-19 R&D activities and has a total budget of PLN 650 million (USD 163.6 million). The second measure is granted as an investment aid for the construction and upgrade of relevant testing and upscaling infrastructures and has a total budget of PLN 650 million (USD 163.6 million).  The third measure is also an investment aid granted for the production of COVID-19 relevant products and has a total budget of PLN 700 million (USD 176.2 million).

The beneficiaries of the aid scheme are SMEs and large enterprises operating in all sectors except agriculture, fishery and aquaculture sectors, and credit and financial institutions. More than 1000 businesses are estimated to benefit from the aid scheme.

All the measures provide support in the form of direct grants and repayable advances. In the first sub-scheme, the Polish authorities didn’t specify the conditions of aid in the form of repayable advances. In the second and third sub-schemes, the investment project shall be completed within six months after the date of granting the aid. When this deadline is not met, per month of delay, 25% of the amount of aid awarded in form of direct grants shall be reimbursed in equal annual installments within five years after the date of granting the aid.

In this context, the Commission noted that: “The measure is liable to distort competition, since it strengthens the competitive position of its beneficiaries. It also affects trade between Member States, since those beneficiaries are active in sectors in which intra-Union trade exists.”

However, the Commission considers that “…positive effects of the measure outweigh its potential negative effects on competition and trade” and approved the state aid “… on the grounds that it is compatible with the internal market pursuant to Article 107(3)(c) of the Treaty on the Functioning of the European Union.”

The state aid is approved under the Temporary Framework for State aid measures. The European Commission adoption of a Temporary Framework under the State Aid rules of the European Union was adopted on 19 March, see related state act.

 
N/A
 
N/A