On 19 March 2020, the European Commission (the “Commission”) adopted the Temporary Framework for State aid measures to support the economy in the current COVID- 19 outbreak (the “Temporary Framework”), which was first amended on 3 April 2020.
On 8 May 2020, the Commission adopted another amend- ment to the Temporary Framework, which is aimed at enabling Member States to adopt targeted aid in the form of recapitalisation of non-financial companies. This second amendment sets forth several principles to guide the assessment of State aid granted for that purpose: (i) conditions with regard to the necessity, appropriateness and size of intervention; (ii) conditions on the State’s entry in the capital of companies and remuneration; (iii) conditions regarding the exit of the State from the capital of the companies concerned; (iv) conditions regarding governance; (v) prohibition of cross-subsidisation and acquisition ban.
Additionally, it provides for reporting and transparency obligations with regard to the recapitalisation aid granted in the form of aid schemes. The amended Temporary Framework also specifies that Member States can notify recapitalisation schemes or individual aid measures. When approving a scheme, the Commission will request the separate notification of aid to a company above the threshold of € 250 million for individual assessment.
