Commission approves Italian State aid scheme to support SMEs affected by COVID-19
Yesterday, the European Commission decided to approve a State aid scheme notified by Italy in support of small and medium-sized enterprises (SMEs) affected by the coronavirus outbreak. The scheme consists of a State guarantee supporting a debt moratorium from banks for SMEs, which includes the postponement of repayments of overdraft facilities, bank advances, bullet loans, mortgages and leasing operations. The scheme aims to temporarily provide SMEs with financial relief, thereby ensuring their liquidity and safeguarding their continuity.
The schemes were approved under the State aid Temporary Framework adopted on 19 March 2020 to support the economy in the context of the COVID-19 outbreak.
The Commission concluded that the Italian State aid scheme is a necessary, appropriate, and proportionate remedy to a serious disturbance in the economy of a Member State, in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. In particular, the Commission took into account that the guarantee covers a well-defined set of financial exposures and is limited in time (as the scheme runs until 30 September 2020 and the guarantee extends for a further 18 months after the end of the moratorium). It also noted that the guarantee covers the payment obligations falling under the moratorium, that the risk taken by the State is limited to 33% and that, before calling on the State guarantee, financial intermediaries must make recovery efforts themselves. The Commission also stressed the fact that, to ensure that the measure benefits only SMEs, who experience difficulties due to the coronavirus outbreak, eligible beneficiaries must not have non-performing exposures prior to 17 March 2020, and they need to certify that their business activity has suffered due to the economic effects of the coronavirus outbreak.
The non-confidential version of the decision has yet to be published in the State aid register, but related information can be viewed on the Commission’s competition website under the case number SA.56690.
In the interim, read the Commission’s press release for more information.