Coronavirus: Commission Statement on consulting the Member States on a proposal to prolong and adjust State aid Temporary Framework

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European Commission
European Commission

Coronavirus: Commission Statement on consulting the Member States on a proposal to prolong and adjust State aid Temporary Framework

Today, the European Commission has sent to Member States for consultation a draft proposal to prolong until 30 June 2021 the State aid Temporary Framework, adopted on 19 March 2020 to support the economy in the context of the coronavirus outbreak, and adjust its scope. As already announced at the time of its adoption, the Commission is now assessing the need to prolong the Temporary Framework beyond its current validity until 31 December 2020, based on important competition policy or economic considerations.

The Commission has sent to the Member States for consultation a draft proposal (i) to prolong at current limits existing provisions of the Temporary Framework (including for liquidity support) for an additional six months until 30 June 2021, (ii) to extend the scope of the Temporary Framework by enabling the Member States to contribute to the fixed costs of companies that are not covered by their revenues, and (iii) to adapt the conditions for recapitalization measures under the Temporary Framework, in particular for the State’s exit from enterprises where the State was an existing shareholder prior to the recapitalization. Member States now have the possibility to comment on the Commission’s draft proposal.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said “Over the past seven months, our State Aid Temporary Framework has paved the way for almost €3 trillion of Member State potential support to businesses hit hardest by the coronavirus crisis. The effects of the crisis will stay with us for a while. That’s why we are proposing to prolong the Temporary Framework until mid-next year and adjust it to the continued needs of businesses while protecting the EU’s Single Market. We will decide on the way forward taking into account the views of all Member States. In parallel, we are working on the way forward to enable Europe’s green and digital recovery – our State aid rules will play an important role guiding the Member States to ensure that limited public funds are well targeted, do not crowd out private investments and seize the benefits of effective competition.“