ANNOUNCEMENT 14 Sep 2021

In September 2021, the European Commission approved a new French scheme to provide debt and capital support to companies affected by the COVID-19 pandemic. 

NUMBER OF INTERVENTIONS

2

  • 2 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

European Commission. Press release. “State aid: Commission approves €3 billion French scheme to provide debt and capital support to companies affected by the coronavirus outbreak”. 14/09/2021. Available at: https://ec.europa.eu/commission/presscorner/detail/en/ip_21_4663

SA.63656 ( 2021/N ) COVID-19: Transition Fund for certain enterprises affected by the COVID-19 outbreak. Available at: https://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_63656

European Commission’s Decision. Subject: State Aid SA.63656 (2021/N) – France COVID-19: Transition Fund for certain enterprises affected by the COVID-19 outbreak. Available at: https://ec.europa.eu/competition/state_aid/cases1/202138/296760_2315311_55_2.pdf

Update December 2021
SA.100959 COVID-19: Modification des régimes d'aides SA.56709, SA.56985, SA.57367, SA.57695, SA.57754, SA.61330, SA.62568, SA.62999, SA.63656 et SA.100299 and SA.60965. Available at: https://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_100959

European Commission. "Objet: Aide d’État SA.100959 (2021/N) – France, COVID-19: Prolongation des régimes d’aides d’État SA.56709, SA.56985, SA.57367, SA.57695, SA.57754, SA.61330, SA.62568, SA.62999, SA.63564 et SA.63656, tels que modifiés". 20/12/2021. Available at: https://ec.europa.eu/competition/state_aid/cases1/202152/SA_100959_002CE17D-0000-C26B-A526-C678D8E9F99C_22_1.pdf

Inception date: 14 Sep 2021 | Removal date: 30 Jun 2022

Capital injection and equity stakes (including bailouts)

On 14 September 2021, the EU approved a French recapitalisation scheme to provide, among others, equity instruments as financial support to companies negatively affected by the COVID-19 pandemic. The scheme will set up a fund labelled “Transition Fund for enterprises affected by the COVID-19 outbreak” with a budget of EUR 3 billion (approx. USD 3.5 billion) and will be in force until 31 December 2021.

The scheme is open to companies active in France, without requirements in terms of the size of the undertaking nor the economic sector of operation (although the financial sector is excluded). Eligible companies need to demonstrate their long-term sustainability and that they were not in financial difficulty before 31 December 2019. Notably, the scheme also provides support in the forms of loans and hybrid debt instruments (see related intervention).

Margrethe Vestager, the Executive Vice-President, stated: “This EUR 3 billion recapitalisation scheme will enable France to support companies affected by the coronavirus outbreak by facilitating their access to finance in these difficult times”.

In this context, the European Commission’s Decision highlighted: “The measures are liable to distort competition, since they strengthen the competitive position of their beneficiaries. They also 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, concluding that the scheme “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 amendments of 2 April 2020, 13 October 2020 and 1 February 2021. The European Commission adopted the Temporary Framework under the State Aid rules of the European Union on 19 March 2020 (see related state act).

Update

On 20 December 2021, the Commission approved SA.100959 extending the validity of, inter alia, the present scheme until 30 June 2022. 

AFFECTED SECTORS

 
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AFFECTED PRODUCTS

 
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Inception date: 14 Sep 2021 | Removal date: 30 Jun 2022

State loan

On 14 September 2021, the EU approved a French recapitalisation scheme to provide, among others, soft and subordinated loans as financial support to companies negatively affected by the COVID-19 pandemic. The scheme will set up a fund labelled “Transition Fund for enterprises affected by the COVID-19 outbreak” with a budget of EUR 3 billion (approx. USD 3.5 billion) and will be in force until 31 December 2021.

The scheme is open to companies active in France, without requirements in terms of the size of the undertaking nor the economic sector of operation (although the financial sector is excluded). Eligible companies need to demonstrate their long-term sustainability and that they were not in financial difficulty before 31 December 2019. Notably, the scheme also provides support in the form of equity instruments (see related intervention).

In this context, the European Commission’s Decision highlighted: “The measures are liable to distort competition, since they strengthen the competitive position of their beneficiaries. They also 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, concluding that the scheme “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 amendments of 2 April 2020, 13 October 2020 and 1 February 2021. The European Commission adopted the Temporary Framework under the State Aid rules of the European Union on 19 March 2020 (see related state act).

Update

On 20 December 2021, the Commission approved SA.100959 extending the validity of, inter alia, the present scheme until 30 June 2022. 

 
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