ANNOUNCEMENT 02 Apr 2020

In April 2020, the European Commission approved a Spanish “umbrella” scheme to support the national economy in the context of the COVID-19 outbreak.

NUMBER OF INTERVENTIONS

4

  • 4 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

European Commission. Press release. 02/04/2020. State aid: Commission approves Spanish “umbrella” scheme to support economy in coronavirus outbreak. Available at: https://ec.europa.eu/commission/presscorner/detail/en/IP_20_581

SA.56851 ECON - Umbrella Scheme - National Temporary Framework for State aid in the form of direct grants, repayable advances, tax advantages, guarantees on loans and subsidised interest rates for loans to support the economy in the current COVID outbreak. Available at: https://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_56851

European Commission Decision. Subject: State Aid SA.56851 (2020/N) - Spain - Umbrella Scheme – National Temporary Framework for State aid in the form of direct grants, repayable advances, tax or payments advantages, guarantees on loans and subsidised interest rates for loans to support the economy in the current COVID outbreak. Available at: https://ec.europa.eu/competition/state_aid/cases1/202016/285295_2148302_60_2.pdf

Update October 2020
SA.58778 COVID-19: Amendments to SA.56851 (2020/N) Conditions of the guarantees on loans and prolongation. Available at: https://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_58778ailable at:

Subject: State Aid SA.58778 (2020/N) – Spain COVID-19: Amendments to SA.56851 (2020/N) Conditions of the guarantees on loans and prolongation. Available at: https://ec.europa.eu/competition/state_aid/cases1/202044/288372_2200867_36_2.pdf

Inception date: 02 Apr 2020 | Removal date: 23 Mar 2021

Financial grant

On 2 April 2020, the EU approved a Spanish state aid measure, an umbrella scheme to support its economy in the context of the COVID-19 pandemic for a preliminary amount of EUR 3.65 billion (approx. USD 3.96 billion).

The umbrella scheme is composed of several instruments, including direct grants. According to the EC Decision, support under the form of direct grants will be granted up to an amount of EUR 800 000 (approx. USD 867 731) per undertaking or self-employed person. There are some specific amounts for undertakings under the agriculture, fisheries, and aquaculture sectors. 

According to the Spanish authorities, it is difficult to estimate the total budget for the scheme, as individual measures based on this umbrella scheme will be implemented on various administrative levels. However, for aid in the form of grants, repayable advances, payment advantages, and tax advantages, the Spanish authorities provided a provisional budget estimation of approximately EUR 3.65 billion (approx. USD 3.96 billion).

In this context, Margrethe Vestager, the Executive Vice-President in charge of competition policy, stated that the approved umbrella scheme will “help Spanish businesses cover their immediate working capital and investment needs in these difficult times”.

The European Commission’s Decision noted the measure “is liable to distort competition, since they strengthen the competitive position of their beneficiaries”, as well as “affect trade between Member States, since those beneficiaries are active in sectors in which intra-Union trade exists”.

Regardless, the Commission approved the state aid, without raising objections, on the grounds that the measure is compatible with the internal market pursuant to Article 107(3)(b) of the Treaty on the Functioning of the European Union.

The state aid is approved under the Temporary Framework under the State Aid and its amendment of 2 April 2020. The European Commission adopted the Temporary Framework under the State Aid rules of the European Union on 19 March (see related state act).  

Update

On 22 October 2020, the EC approved SA 58778 that extends the first umbrella scheme and all its original measures until 30 June 2021.

On 23 March 2021, the EC approved SA 61875 that increases the budget of the present measure and extends it until 31 December 2021 (see related state act).

AFFECTED SECTORS

 
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AFFECTED PRODUCTS

 
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Inception date: 02 Apr 2020 | Removal date: 23 Mar 2021

State loan

On 2 April 2020, the EU approved a Spanish state aid measure, an umbrella scheme to support its economy in the context of the COVID-19 pandemic for a preliminary amount of EUR 3.65 billion (approx. USD 3.96 billion).

The umbrella scheme is composed of several instruments, including repayable advances and subsidized loans. The loans will be granted based on investment or working capital needs. Moreover, the beneficiaries are the self-employed, SMEs, and large companies from all economic sectors (except credit institutions).

According to the Spanish authorities, it is difficult to estimate the budget for the scheme, as individual measures based on this umbrella scheme will be implemented on various administrative levels. However, for aid in the form of grants, repayable advances, payment advantages, and tax advantages, the Spanish authorities provided a provisional budget estimation of approximately EUR 3.65 billion (approx. USD 3.96 billion).

In this context, Margrethe Vestager, the Executive Vice-President in charge of competition policy, stated that the approved umbrella scheme will “help Spanish businesses cover their immediate working capital and investment needs in these difficult times”.

The European Commission’s Decision noted the measure “is liable to distort competition, since they strengthen the competitive position of their beneficiaries”, as well as “affect trade between Member States, since those beneficiaries are active in sectors in which intra-Union trade exists”.

Regardless, the Commission approved the state aid, without raising objections, on the grounds that the measure is compatible with the internal market pursuant to Article 107(3)(b) of the Treaty on the Functioning of the European Union.

The state aid is approved under the Temporary Framework under the State Aid and its amendment of 2 April 2020. The European Commission adopted the Temporary Framework under the State Aid rules of the European Union on 19 March (see related state act).  

Update

On 22 October 2020, the EC approved SA 58778 that extends the first umbrella scheme and all its original measures until 30 June 2021.

On 23 March 2021, the EC approved SA 61875 that increases the budget of the present measure and extends it until 31 December 2021 (see related state act).

 
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N/A
Inception date: 02 Apr 2020 | Removal date: 23 Mar 2021

Tax or social insurance relief

On 2 April 2020, the EU approved a Spanish state aid measure, an umbrella scheme to support its economy in the context of the COVID-19 pandemic for a preliminary amount of EUR 3.65 billion (approx. USD 3.96 billion).

The umbrella scheme is composed of several instruments, including tax or payment advantages. According to the EC Decision, support under the form of tax advantages will be granted up to an amount of EUR 800 000 (approx. USD 867 731) per undertaking or self-employed person. There are some specific amounts for undertakings under the agriculture, fisheries, and aquaculture sectors.

According to the Spanish authorities, it is difficult to estimate the budget for the scheme, as individual measures based on this umbrella scheme will be implemented on various administrative levels. However, for aid in the form of grants, repayable advances, payment advantages, and tax advantages, the Spanish authorities provided a provisional budget estimation of approximately EUR 3.65 billion (approx. USD 4 billion).

In this context, Margrethe Vestager, the Executive Vice-President in charge of competition policy, stated that the approved umbrella scheme will “help Spanish businesses cover their immediate working capital and investment needs in these difficult times”.

The European Commission’s Decision noted the measure “is liable to distort competition, since they strengthen the competitive position of their beneficiaries”, as well as “affect trade between Member States, since those beneficiaries are active in sectors in which intra-Union trade exists”.

Regardless, the Commission approved the state aid, without raising objections, on the grounds that the measure is compatible with the internal market pursuant to Article 107(3)(b) of the Treaty on the Functioning of the European Union.

The state aid is approved under the Temporary Framework under the State Aid and its amendment of 2 April 2020. The European Commission adopted the Temporary Framework under the State Aid rules of the European Union on 19 March (see related state act).  

Update

On 22 October 2020, the EC approved SA 58778 that extends the first umbrella scheme and all its original measures until 30 June 2021.

On 23 March 2021, the EC approved SA 61875 that increases the budget of the present measure and extends it until 31 December 2021 (see related state act).

 
N/A
 
N/A
Inception date: 02 Apr 2020 | Removal date: 23 Mar 2021

Loan guarantee

On 2 April 2020, the EU approved a Spanish state aid measure, an umbrella scheme to support its economy in the context of the COVID-19 pandemic for a preliminary amount of EUR 3.65 billion (approx. USD 4 billion).

The umbrella scheme is composed of several instruments, including guarantees on loans with a maximum maturity of 6 years. The loan guarantees will have the following coverages: (i) 90% of the principal where losses are sustained proportionally by the credit institution and the State; or (ii) 35% of loan principal where losses are first attributed to the State and only then to the credit. 

According to the Spanish authorities, it is difficult to estimate the budget for the scheme, as individual measures based on this umbrella scheme will be implemented on various administrative levels. However, for aid in the form of grants, repayable advances, payment advantages, and tax advantages, the Spanish authorities provided a provisional budget estimation of approximately EUR 3.65 billion (approx. USD 3.96 billion).

In this context, Margrethe Vestager, the Executive Vice-President in charge of competition policy, stated that the approved umbrella scheme will “help Spanish businesses cover their immediate working capital and investment needs in these difficult times”.

The European Commission’s Decision noted the measure “is liable to distort competition, since they strengthen the competitive position of their beneficiaries”, as well as “affect trade between Member States, since those beneficiaries are active in sectors in which intra-Union trade exists”.

Regardless, the Commission approved the state aid, without raising objections, on the grounds that the measure is compatible with the internal market pursuant to Article 107(3)(b) of the Treaty on the Functioning of the European Union.

The state aid is approved under the Temporary Framework under the State Aid and its amendment of 2 April 2020. The European Commission adopted the Temporary Framework under the State Aid rules of the European Union on 19 March (see related state act).  

Update

On 22 October 2020, the EC approved SA 58778 that extends the first umbrella scheme and all its original measures until 30 June 2021.

On 23 March 2021, the EC approved SA 61875 that increases the budget of the present measure and extends it until 31 December 2021 (see related state act).

 
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