Competition Law - EU Commission approves first Spanish COVID-19 aid
On 17 March, the Spanish government approved a number of measures to alleviate the economic and social impact of COVID-19 through Royal Decree-Law 8/2020 (RDL 8/2020). In particular, RDL 8/2020 enabled the government to grant state guarantees and securities for an amount of up to EUR 100,000 million to companies and self-employed individuals in order to secure access to bank loans in the event of cash flow distress. An agreement of the Council of Ministers will develop the conditions of these guarantees and release a first tranche of up to EUR 20,000 million of guarantees.
These guarantees on loans (“Línea de avales para las empresas y autónomos para paliar los efectos económicos del COVID-19”) are subject to the applicable rules on State aid, particularly to the so-called “Temporary Framework” recently approved by the European Commission.
Consequently, Spain notified the aid to the Commission on 23 March 2020. The European Commission has just made available a public version of its decision on the aid of 24 March 2020.
This legal alert briefly summarises the main features of the notified aid as well as the key elements of the Commission’s assessment to conclude on the legality of the measure.