The EU Commission adopts 5th amendment to the temporary framework for State aid measures to support the economy in the current COVID-19 outbreak

On 28 January 2021, the European Commission (“Commission”) amended the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak (the “Temporary FrameworK”). Below we outline the most relevant amendments:

  • The application of the Temporary Framework is prolonged until 31 December 2021.
  • The aid ceilings set out in section 3.1 (“Limited amounts of aid”) and section 3.12 (“Aid in the form of support for uncovered fixed costs”) of the Temporary framework are increased. The new ceilings are € 225,000 per company active in primary production of agricultural products (previously € 100,000), € 270,000 per company active in the fishery and aquaculture sector (previously € 120,000), and € 1.8 million per company active in all other sectors (previously € 800,000). As before, these aid amounts can be combined with de minimis aid. For companies especially hit by the coronavirus crisis, Member States can contribute to the part of the fixed costs of companies that are not covered by their revenues, in an amount up to € 10 million per company (previously € 3 million).
  • Member States are allowed to convert repayable instruments (e.g., guarantees, loans, repayable advances) granted under the Temporary Framework into other forms of aid (such as direct grants), until 31 December 2022. Such conversion may not exceed the new ceilings for limited amounts of aid (see above) and must meet certain conditions.
  • The temporary removal of all countries from the list of “marketable risk” countries under the Short-term export-credit insurance Communication is extended until 31 December 2021.

In view of the above, the Commission notes that Member States may envisage modifying existing aid measures approved under the Temporary Framework in order to prolong their period of application until 31 December 2021. Furthermore, they may also increase the budget of existinging aid measures or introduce other amendments to align those measures with the amended Temporary Framework. For that purpose, Member States are invited to notify to the Commission a list of all existing aid measures they envisage modifying and to provide the necessary information listed in the annex of the Communication on the 5th amendment to the Temporary Framework. The Commission envisages adopting one single decision covering the entire list of notified measures.

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Authors

  • Van Bael & Bellis (Brussels)
  • Van Bael & Bellis (Brussels)

Quotation

Francesco Pili, Markus Wellinger, The EU Commission adopts 5th amendment to the temporary framework for State aid measures to support the economy in the current COVID-19 outbreak , 28 January 2021, e-Competitions January 2021, Art. N° 99391

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