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EU Commission approves €200m Irish scheme to support the economy

Written by Robert McHugh, on 31st Mar 2020. Posted in EU

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The European Commission has found a €200 million Irish scheme to support companies affected by the coronavirus outbreak to be in line with EU State aid rules.

The scheme was approved under the State aid Temporary Framework to support the economy in the context of the COVID-19 outbreak adopted by the Commission on 19 March 2020.

Ireland notified to the Commission a €200 million scheme to support companies affected by the coronavirus outbreakunder the Temporary Framework. The support, in the form of repayable advances, will be accessible to companies that experience or expect to experience a decline in turnover of at least 15% compared to their revenue before the coronavirus outbreak in Ireland. 

The scheme applies to undertakings in Ireland employing 10 or more full time employees in certain manufacturing sectors and/or internationally traded sectors, with a turnover of less than €500 million per year. The estimated budget of the scheme amounts to €200 million.

The Commission found that the scheme notified by Ireland is in line with the conditions set out in the Temporary Framework. In particular, the maximum aid amount does not exceed €800,000 per company.

The Temporary Framework will be in place until the end of December 2020. With a view to ensuring legal certainty, the Commission will assess before that date if it needs to be extended.

The Commission has adopted a Temporary Framework to enable Member States to use the full flexibility foreseen under State aid rules to support the economy in the context of the Coronavirus outbreak.

The Temporary Framework provides for five types of aid, which can be granted by Member States:
Direct grants, selective tax advantages and advance payments
State guarantees for loans taken by companies from banks 
Subsidised public loans to companies
Safeguards for banks that channel State aid to the real economy
Short-term export credit insurance

Speaking this week, Executive Vice-President Margrethe Vestager, in charge of competition policy said, "With this €200 million Irish scheme, approved under the new State aid Temporary Framework, we continue to work with Member States to ensure timely support to the economy through these difficult times. This measure will, in the form of repayable advances, help companies affected by the coronavirus outbreak to weather this crisis and bounce back strongly afterwards."

Source: www.businessworld.ie

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