France gets EU Commission approval for €7 billion aid to businesses

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The European Commission has approved a €7 billion French “umbrella” scheme to support small and medium-sized enterprises (SMEs) and large corporates in France affected by the coronavirus outbreak. The scheme, called “Regime Cadre Temporaire”, was approved under the State aid Temporary Framework.

he measure is a French-wide National Temporary Framework for State aid, with an estimated budget of €7 billion, and allows for the provision of aid in the form of:

a)   Limited amount of aid in the form of direct grants, equity injections, repayable advances and subsidised loans, up to a maximum nominal amount of €100,000 to a company active in the primary agricultural sector, €120,000 to a company active in the fishery and aquaculture sector, and €800,000 to a company active in all other sectors;

b)   State guarantees for loans, subject to safeguards for banks to channel State aid to the real economy; and/or

c)    Public loans to companies with favourable interest rates;

The measure allows aid to be granted by French authorities at all levels, including central government, regional and local authorities and other bodies administering schemes involving state resources channelled through their own budgets.

The measure is targeted at SMEs and large corporates and applies to the whole territory of France. Aid is granted under the measure either directly or, if it concerns guarantees on loans, through credit institutions and other financial institutions as financial intermediaries.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “The €7 billion French scheme approved will support French companies of all sizes through a wide range of support measures, including direct grants, repayable advances, public guarantees on loans and loans at favourable terms. The objective of the measure is to help businesses cover their immediate working capital and investment needs in these difficult times due to the coronavirus outbreak. We continue to work with all Member States to ensure that national support measures can be put in place in a timely, coordinated and effective way, in line with EU rules.”

 

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