The European Commission said on Friday 17 April that it is analysing replies from EU countries on updating the state aid framework to allow countries to recapitalise companies in light of COVID-19. The procedure leading to the adoption of the text is therefore still under way and will have to wait a few more days, the Commission indicated (see EUROPE 12465/3).
The Financial Times infers from the draft text (State Aid framework) that companies receiving capital from EU member states during the coronavirus crisis “will not be allowed” to pay dividends, buy back shares or provide bonuses or similar remuneration.
These public interventions “must remain measures of last resort”, recalled the Commission, which has therefore provided “safeguards”.
Such aid will be subject to strict governance rules and to clear conditions as regards State acquisition of the capital of the companies concerned, the remuneration by the State, and the exit of the State from these companies.
A draft text provides that such rescues are possible only if the company is in serious difficulty and if there has been no State intervention. In addition, the draft requires EU Member States to develop an exit strategy above a certain threshold (20%, according to the draft). (Original version in French by Lionel Changeur)