ANNOUNCEMENT 03 Nov 2020

In November 2020, the Spanish government announced a temporary support to Air Europa in the context of the COVID-19 pandemic.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

Ministerio de Hacienda. Finance Ministry. Press release. "El Gobierno autoriza el apoyo p├║blico temporal a Air Europa". 03/11/2020. Available at: https://www.hacienda.gob.es/Documentacion/Publico/GabineteMinistro/Notas%20Prensa/2020/CONSEJO%20DE%20MINISTROS/03-11-20%20NP%20CMIN%20FONDO%20AIR%20EUROPA.pdf

Inception date: 03 Nov 2020 | Removal date: open ended

State loan

On 3 November 2020, the Spanish government announced a EUR 475 million (approx. USD 558 million) temporary support to Air Europa in the context of the mobility restrictions imposed in consequence of the COVID-19 pandemic. 

The support will be channeled through two loans: (i) a participatory loan for the amount of EUR 240 million (approx. USD 282 million) and an ordinary loan of EUR 235 million (approx. USD 276 million). The company will have a maximum term of six years to fully repay the loans.

According to the press release, the loan is the first approved operation under the EUR 10 billion (approx. USD 11.8 billion) Recapitalization Fund approved in July 2020 (see related state act). The Fund is managed by the State Society of Industrial Participations (SEPI in Spanish), a public entity founded in 1995 with the mission of making profitable businesses investments in Spain. 

Air Europa is the second biggest Spanish airline and the one with the largest number of authorizations to fly to international destinations. It flies to 130 destinations in 60 different countries, which implies a significant impact on the Spanish tourism sector. In this sense, according to the press release, the airline "provides an essential service to ensure adequate national and international flights". 

A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the investment support granted here is discriminatory.

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