The European Commission adopted on Wednesday 23 March the Temporary Crisis Framework to allow Member States to use the flexibility provided by the State aid rules to support the economy in the context of the Russian invasion of Ukraine (see EUROPE 12916/6).
Margrethe Vestager, Executive Vice-President in charge of Competition Policy said: “We need to mitigate the economic impact of this war and to support severely impacted companies and sectors. And we need to act in a coordinated manner”.
Russian-controlled entities subject to sanctions will be excluded from the scope of these measures.
Three types of aid are planned until the end of 2022:
- limited amounts of aid: Member States will be able to set up schemes to grant up to €35,000 to crisis-affected companies active in the agriculture, fisheries and aquaculture sectors and up to €400,000 per crisis-affected company active in all other sectors. This aid does not have to be linked to an increase in energy prices. This support may be granted in any form, including direct grants.
- liquidity support in the form of State guarantees and subsidised loans: Member States will be able to provide subsidised State guarantees to ensure that banks continue to lend to all companies affected by the current crisis, and public and private loans with subsidised interest rates. These loans would be accompanied by subsidised premiums, with reductions on the estimated market rate for annual premiums applied to new loans for small and medium-sized enterprises (SMEs) and other enterprises;
- aid to compensate for high energy prices: Member States will be able to partially compensate companies, in particular intensive energy consumers, for the extra costs caused by exceptional increases in gas and electricity prices. This support can be granted in any form, including direct grants. The total amount of aid per beneficiary may at no time exceed 30% of the eligible costs up to a maximum of €2 million.
Where the company suffers operating losses, additional aid may be necessary to ensure the continuation of an economic activity: Member States may grant aid above these ceilings, up to €25 million for energy-intensive users and up to €50 million for companies active in certain specific sectors, such as the production of aluminium and other metals, glass fibres, pulp, fertilisers or hydrogen, and many basic chemicals.
The new framework includes safeguards and Member States will have to include sustainability requirements for the granting of aid due to additional energy costs.
Link to the framework: https://aeur.eu/f/we (Original version in French by Lionel Changeur)