On Tuesday 30 June, the European Commission adopted a third amendment extending to micro, small and medium enterprises (SMEs) and start-ups the temporary state aid guidelines adopted in March to deal with the Covid-19 pandemic.
Member States are now allowed to provide public support to all SMEs, even if they were already in financial difficulties before the end of 2019. Only companies that are genuinely in bankruptcy proceedings, have not reimbursed rescue aid or are the subject of a restructuring plan are not covered by the proposal.
The legislative amendment also increases the possibilities to support start-ups, in particular innovative start-ups that might be loss-making in their high-growth phase, but which are essential for economic recovery.
In addition, the Commission has also adapted the conditions applicable to recapitalisation measures under the Temporary State Aid Framework where private investors contribute to the capital increase of companies alongside the State. Private equity injections will limit the need for public support and the risk of distortions of competition, the European institution stressed in a statement.
In addition, the legislative amendment will allow companies with a public shareholding to raise funds from their shareholders in the same way as private companies.
See the legislative proposal: https://bit.ly/3iiWPkr (Original version in French by Mathieu Bion)