EU institution news

Delivering the European Green Deal: Commission consults on review of renewable energy and energy efficiency directives | EU Commission Press

The Commission has taken the first steps in the review process of the Renewable Energy Directive and the Energy Efficiency Directive, by inviting citizens and stakeholders to comment on two Roadmaps. The review of both Directives will be essential to identify how energy policies on renewables and energy efficiency will contribute in achieving the climate and environmental ambitions of the European Green Deal. The reviews are part of a broader process based on the upcoming adoption of the Climate Target Plan. Commissioner for Energy, Kadri Simson, said: “To deliver on the ambition of the European Green Deal, we have started assessing the impact of more ambitious 2030 climate objectives and different scenarios to get there. It is clear that every path to climate neutrality requires scaling up and accelerating the production of renewable energy, and reinforcing our action on energy efficiency. We have to consider all the tools we have to make that happen. The present roadmaps are the beginning of a process that will guide our future action set for June 2021.” The Roadmap on the Renewable Energy Directive will assess whether the EU renewable energy target of at least 32% for 2030 should be raised and whether other parts of the Directive require an adjustment in line with the Green Deal, including the Biodiversity Strategy. The Roadmap on the Energy Efficiency Directive will evaluate the adequacy of the rules in place to deliver the existing energy efficiency target of at least 32.5% for 2030. These two Roadmaps are open to responses until 21 September. The next phase in the review of these Directives will be an open public consultation later this year. More information is available here

State aid: Commission approves €51 million Latvian scheme to support companies with exporting activities affected by coronavirus outbreak | EU Commission Press

The European Commission has approved a Latvian scheme, with an estimated budget of €51 million, to support companies engaged in the export of goods and services in the context of the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework. The public support, which will take the form of direct grants, will cover up to 25% of the mandatory social security contributions paid by the beneficiaries. The scheme will be open to companies with exporting activities active in all sectors, with some exceptions defined by Latvia such as companies active in the primary production of agricultural products, in the processing and marketing of agriculture products, in the fishery and aquaculture sector as well as in the financial sector. The measure is expected to benefit 350 companies. The purpose of the scheme is to address the liquidity needs of companies affected by the current crisis and to help them to continue their activities, start investments and maintain employment during and after the outbreak. The Commission found that the Latvian scheme is in line with the conditions set out in the Temporary Framework. In particular, the aid will not exceed €800,000 per company as provided by the Temporary Framework. The Commission concluded that the measure is necessary, appropriate and proportionate to remedy 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. On this basis, the Commission approved the measures under EU State aid rules. More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.58104 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.

State aid: Commission approves creation of new national development bank Banco Português de Fomento in Portugal | EU Commission Press

The European Commission has approved, under EU State aid rules, Portuguese plans to set up a new national development bank, “Banco Português de Fomento” (“BPF”), to promote the growth of the Portuguese economy. BPF will result from the merger between the existing Instituição Financeira de Desenvolvimento and PME Investimentos into SPGM, which will rename itself BPF following the merger. BPF will be owned by the Portuguese State with a share capital of €255 million and BPF’s activities will target market failures in lending and capital markets. Concretely, BPF will focus on improving access to finance for projects in research and innovation, sustainable infrastructure, social investment and skills as well as projects increasing the competitiveness of Portuguese companies and encouraging investments by the public sector. The Commission found that the creation of BPF is an appropriate and proportionate solution to provide additional financing to companies and projects that would otherwise remain underfinanced because of market failures. Furthermore, BPF will implement safeguards to ensure that the State-supported institution does not crowd out private financial institutions. On this basis, the Commission concluded that the measure is in line with EU State aid rules, in particular Article 107(3)(c) of the Treaty on the Functioning of the European Union (TFEU), which enables the Commission to approve State aid measures implemented by Member States to facilitate the development of certain economic activities or of certain economic areas, subject to certain conditions. More information will be available on the Commission’s competition website, in the public case register, under the case number SA.55719.

Declaration of the High Representative on behalf of the EU on the postponement of the Legislative Council elections in Hong Kong | EU Council Press

As set out in the Council conclusions of 24 July, the EU is following closely the political situation in Hong Kong and reiterates that it is essential that the Legislative Council elections take place in an environment which is conducive to the exercise of democratic rights and freedoms as enshrined in the Hong Kong’s Basic Law.

The proposed postponement by one year of the elections to the Legislative Council through recourse to emergency powers, would delay the renewal of its democratic mandate and call into question the exercise of the democratic rights and freedoms guaranteed under Hong Kong’s Basic Law.

The recent disqualification of pro-democracy candidates, including sitting lawmakers previously democratically elected by the people of Hong Kong, also weakens Hong Kong’s international reputation as a free and open society. The protection of civil and political rights in Hong Kong is a fundamental part of the “One Country, Two Systems” principle, which the EU supports.

The EU calls on the Hong Kong authorities to reconsider these decisions.

Commission approves Cohesion Policy funds redirection to mitigate the impact of the pandemic in Denmark and near the Hungarian-Slovakian border | EU Commission Press

The European Commission has approved the modifications of the ‘Innovation and Sustainable Growth in Businesses’ programme in Denmark and of the Interreg Hungary-Slovakia programme. Thanks to the modifications, the two programmes will allocate additional resources to address the effects of the coronavirus crisis. Commissioner for Cohesion and Reforms, Elisa Ferreira,said: “From the Danube river to the North Sea swift action under Cohesion policy is mobilising resources and people to fight the pandemic. There is no time to waste and I look forward to seeing more programmes modified according to current needs in the following weeks.” The modification of the Interreg Slovakia-Hungary programme will increase temporarily the EU co-financing rate to 100% of eligible expenditure, thus helping beneficiaries overcome liquidity scarcity in the implementation of their projects. In Denmark, the modification of the “Innovation and Sustainable Growth in Businesses” programme will extend financing to companies affected by the coronavirus pandemic to restructure and consolidate themselves. The modification will also improve cooperation between large companies and SMEs in green transition, thus helping the later overcome difficulties caused by the pandemic in maintaining the green transition and implementing green business models. The Coronavirus Response Investment Initiative packages, proposed by the Commission in March and April this year, made the modification of the two programmes possible. So far, 18 Member States have adjusted their Cohesion policy programmes to redirect funding towards fighting the consequences of the coronavirus pandemic. 

State aid: Commission approves €6 billion Italian schemes to support SMEs affected by coronavirus outbreak | EU Commission Press

The European Commission has approved three Italian schemes, with an overall budget of €6 billion, mainly consisting of incentives to the recapitalisation by private investors of small and medium-sized enterprises (‘SMEs’) affected by the coronavirus outbreak. The three schemes were approved directly under Article 107(3)(b) of the Treaty on the Functioning of the European Union (TFEU) and the State aid Temporary Framework, respectively.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “With these three schemes, with an overall budget of €6 billion, Italy will  further support SMEs affected by the coronavirus outbreak by strengthening their capital base and facilitating their access to finance in these difficult times. The schemes aim at incentivising private investors to help companies cope with the liquidity shortages they are facing as a result of the outbreak and continue their activity. We continue to work in close cooperation with Member States to find workable solutions to mitigate the economic impact of the coronavirus outbreak, in line with EU rules.”

The Italian support measures

Italy notified to the Commission under EU State aid rules, three schemes, with an overall budget of €6 billion, to facilitate the provision of capital and liquidity to companies affected by the coronavirus outbreak. The schemes, which are complementary among each other and designed to incentivise the mobilisation of private investments, consists in the following:

  • Under the first scheme, a subsidy associated with a tax credit, where private investors injecting capital in the affected companies will be entitled to receive a tax credit of up to 20% of the invested amount. Under the scheme, the aid will therefore be granted both to the investor (that receives the tax advantage) and the investee company (that receives the investment).
  • The second measure is a tax credit scheme, where the companies themselves would receive a tax credit of up to 30% of the amount of their capital increase.
  • Finally, under the third scheme, the public support will take the form of subordinated loans.

All schemes will be accessible to companies that have faced a severe reduction of revenues in March and April 2020, provided they approve and execute a capital increase.

The schemes therefore aim at enhancing the access to external financing of those companies that are most severely affected by the economic impact of the coronavirus outbreak, thus helping them to ensure the continuation of their activities.

The Commission found that aid to the investees under the three schemes is in line with the conditions set out in the Temporary Framework. In particular, (i) under the first two schemes, the aid will not exceed €800,000 per company(except in the primary agriculture sector and in the fishery and aquaculture sector, where the limits of €100,000 and €120,000 per company respectively, apply), and (ii) with respect to the third scheme, aid will not exceed 12.5% of the turnover of the beneficiary in 2019 as provided by the Temporary Framework. Under all three schemes, aid to the companies is limited in time and can be granted by the end of 2020.

As regards,the aid to the investors under the first scheme, the Commission assessed the measure under EU State aid rules, and in particular Article 107(3)(b) TFEU, which enables the Commission to approve State aid measures implemented by Member States to remedy a serious disturbance to their economy.

The Commission found that the aid is in line with the principles set out in the EU Treaty and the general principles set out in the Temporary Framework. It is well targeted to remedy a serious disturbance to the Italian economy. In this respect, the Commission considered that the aid will be merely granted to incentivise and facilitate private investment into investee companies, which have experienced a significant reduction of turnover as a result of a coronavirus crisis. The intermediation of the private investors is therefore indispensable to carrying out the investments.

The Commission concluded that the three schemes arenecessary, appropriate and proportionate to remedy 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.

On this basis, the Commission approved the measures under EU State aid rules.

Background

In case of particularly severe economic situations, such as the one currently faced by all Member States and the UK due the coronavirus outbreak, EU State aid rules allow Member States to grant support to remedy a serious disturbance to their economy. This is foreseen by Article 107(3)(b) TFEU of the Treaty on the Functioning of the European Union.

On 19 March 2020, the Commission has adopted a State aid 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, as amended on 3 April 2020 and 8 May and 29 June 2020, provides for the following types of aid, which can be granted by Member States:

(i) Direct grants, equity injections, selective tax advantages and advance payments of up to €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 to address its urgent liquidity needs. Member States can also give, up to the nominal value of €800,000 per company zero-interest loans or guarantees on loans covering 100% of the risk, except in the primary agriculture sector and in the fishery and aquaculture sector, where the limits of €100,000 and €120,000 per company respectively, apply.

(ii) State guarantees for loans taken by companies to ensure banks keep providing loans to the customers who need them. These state guarantees can cover up to 90% of risk on loans to help businesses cover immediate working capital and investment needs.

(iii) Subsidised public loans to companies (senior and subordinated debt) with favourable interest rates to companies. These loans can help businesses cover immediate working capital and investment needs.

(iv) Safeguards for banks that channel State aid to the real economy that such aid is considered as direct aid to the banks’ customers, not to the banks themselves, and gives guidance on how to ensure minimal distortion of competition between banks.

(v) Public short-term export credit insurance for all countries, without the need for the Member State in question to demonstrate that the respective country is temporarily “non-marketable”.

(vi) Support for coronavirus related research and development (R&D) to address the current health crisis in the form of direct grants, repayable advances or tax advantages. A bonus may be granted for cross-border cooperation projects between Member States.

(vii) Support for the construction and upscaling of testing facilities to develop and test products (including vaccines, ventilators and protective clothing) useful to tackle the coronavirus outbreak, up to first industrial deployment. This can take the form of direct grants, tax advantages, repayable advances and no-loss guarantees. Companies may benefit from a bonus when their investment is supported by more than one Member State and when the investment is concluded within two months after the granting of the aid.

(viii) Support for the production of products relevant to tackle the coronavirus outbreak in the form of direct grants, tax advantages, repayable advances and no-loss guarantees. Companies may benefit from a bonus when their investment is supported by more than one Member State and when the investment is concluded within two months after the granting of the aid.

(ix) Targeted support in the form of deferral of tax payments and/or suspensions of social security contributions for those sectors, regions or for types of companies that are hit the hardest by the outbreak.

(x) Targeted support in the form of wage subsidies for employees for those companies in sectors or regions that have suffered most from the coronavirus outbreak, and would otherwise have had to lay off personnel.

(xi) Targeted recapitalisation aid to non-financial companies, if no other appropriate solution is available. Safeguards are in place to avoid undue distortions of competition in the Single Market: conditions on the necessity, appropriateness and size of intervention; conditions on the State’s entry in the capital of companies and remuneration; conditions regarding the exit of the State from the capital of the companies concerned; conditions regarding governance including dividend ban and remuneration caps for senior management; prohibition of cross-subsidisation and acquisition ban and additional measures to limit competition distortions; transparency and reporting requirements.

The Temporary Framework enables Member States to combine all support measures with each other, except for loans and guarantees for the same loan and exceeding the thresholds foreseen by the Temporary Framework. It also enables Member States to combine all support measures granted under the Temporary Framework with existing possibilities to grant de minimis to a company of up to €25,000 over three fiscal years for companies active in the primary agricultural sector, €30,000 over three fiscal years for companies active in the fishery and aquaculture sector and €200,000 over three fiscal years for companies active in all other sectors. At the same time, Member States have to commit to avoid undue cumulation of support measures for the same companies to limit support to meet their actual needs.

Furthermore, the Temporary Framework complements the many other possibilities already available to Member States to mitigate the socio-economic impact of the coronavirus outbreak, in line with EU State aid rules. On 13 March 2020, the Commission adopted a Communication on a Coordinated economic response to the COVID-19 outbreak setting out these possibilities.

For example, Member States can make generally applicable changes in favour of businesses (e.g. deferring taxes, or subsidising short-time work across all sectors), which fall outside State Aid rules. They can also grant compensation to companies for damage suffered due to and directly caused by the coronavirus outbreak.

The Temporary Framework will be in place until the end of December 2020. As solvency issues may materialise only at a later stage as this crisis evolves, for recapitalisation measures only the Commission has extended this period until the end of June 2021. With a view to ensuring legal certainty, the Commission will assess before those dates if it needs to be extended.

The non-confidential version of the decision will be made available under the case number SA.57289 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved. New publications of State aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

More information on the Temporary Framework and other action the Commission has taken to address the economic impact of the coronavirus pandemic can be found here.

State aid: Commission approves €10 billion Spanish fund to provide debt and capital support to companies affected by the coronavirus outbreak | EU Commission Press

The European Commission has approved Spanish plans to set up a fund (Solvency Support Fund) with a budget of €10 billion that will invest through debt and equity instruments in companies active in Spain affected by the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “The coronavirus crisis has hit the Spanish economy hard. The Spanish Solvency Support Fund aims to unlock capital support of €10 billion to Spanish companies by facilitating their access to finance in these difficult times. The scheme ensures that the State is sufficiently remunerated for the risk assumed by taxpayers, that there are incentives for the State to exit as soon as possible, and that the support comes with strings attached, including a ban on dividends, bonus payments as well as further measures to limit distortions of competition. We continue to work in close cooperation with Member States to find workable solutions to mitigate the economic impact of the coronavirus outbreak, in line with EU rules.”

The Spanish support measure

Spain notified the Commission under the Temporary Framework of plans to establish a €10 billion fund through the State budget that will provide debt and capital support to strategic enterprises active in Spain affected by the coronavirus outbreak. Under the scheme, the support will take the form of debt and recapitalisation instruments.

The Commission found that the Spanish measure is in line with the conditions set out in the Temporary Framework. In particular:  

With respect to recapitalisation measures, (i) support is available to companies only if no other appropriate solution is available and it is in the common interest to intervene, (ii) support is limited to the amount necessary to ensure the viability of beneficiaries and to restore their capital position to before the coronavirus outbreak; (iii) the scheme provides an adequate remuneration for the State and it incentivises beneficiaries and/or their owners to repay the support as early as possible (including  a dividend ban, and a ban on bonus payments to management); (iv) safeguardsare in place to ensurethat beneficiaries do not unduly benefit from the recapitalisation aid by the State to the detriment of fair competition in the Single Market, such as an acquisition ban to avoid aggressive commercial expansion; (vi) aid to a company above the threshold of €250 million has to be notified separately for individual assessment.

With respect to aid in the form of subordinated debt instruments, where the fund’s interventions exceed the relevant limits on turnover and wage bill of the beneficiaries, the aid will have to fully comply with the stricter conditions established for recapitalisation measures, in line with the Temporary Framework.

Finally, only companies that were not considered to be in financial difficulty already on 31 December 2019 are eligible for aid under this scheme.

The Commission concluded that the measure isnecessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State, in line with Article 107(3)(b) of the Treaty on the Functioning of the European Union (TFEU) and the conditions set out in the Temporary Framework.

On this basis, the Commission approved the measure under EU State aid rules.

Background

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, as amended on 3 April8 May  and 29 June 2020, provides for the following types of aid, which can be granted by Member States:

(i) Direct grants, equity injections, selective tax advantages and advance payments of up to €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 to address its urgent liquidity needs. Member States can also give, up to the nominal value of €800,000 per company zero-interest loans or guarantees on loans covering 100% of the risk, except in the primary agriculture sector and in the fishery and aquaculture sector, where the limits of €100,000 and €120,000 per company respectively, apply.

(ii) State guarantees for loans taken by companies to ensure banks keep providing loans to the customers who need them. These state guarantees can cover up to 90% of risk on loans to help businesses cover immediate working capital and investment needs.

(iii) Subsidised public loans to companies (senior and subordinated debt) with favourable interest rates to companies. These loans can help businesses cover immediate working capital and investment needs.

(iv) Safeguards for banks that channel State aid to the real economy that such aid is considered as direct aid to the banks’ customers, not to the banks themselves, and gives guidance on how to ensure minimal distortion of competition between banks.

(v) Public short-term export credit insurance for all countries, without the need for the Member State in question to demonstrate that the respective country is temporarily “non-marketable”.

(vi) Support for coronavirus related research and development (R&D) to address the current health crisis in the form of direct grants, repayable advances or tax advantages. A bonus may be granted for cross-border cooperation projects between Member States.

(vii) Support for the construction and upscaling of testing facilities to develop and test products (including vaccines, ventilators and protective clothing) useful to tackle the coronavirus outbreak, up to first industrial deployment. This can take the form of direct grants, tax advantages, repayable advances and no-loss guarantees. Companies may benefit from a bonus when their investment is supported by more than one Member State and when the investment is concluded within two months after the granting of the aid.

(viii) Support for the production of products relevant to tackle the coronavirus outbreak in the form of direct grants, tax advantages, repayable advances and no-loss guarantees. Companies may benefit from a bonus when their investment is supported by more than one Member State and when the investment is concluded within two months after the granting of the aid.

(ix) Targeted support in the form of deferral of tax payments and/or suspensions of social security contributions for those sectors, regions or for types of companies that are hit the hardest by the outbreak.

(x)  Targeted support in the form of wage subsidies for employees for those companies in sectors or regions that have suffered most from the coronavirus outbreak, and would otherwise have had to lay off personnel.

(xi) Targeted recapitalisation aid to non-financial companies, if no other appropriate solution is available. Safeguards are in place to avoid undue distortions of competition in the Single Market: conditions on the necessity, appropriateness and size of intervention; conditions on the State’s entry in the capital of companies and remuneration; conditions regarding the exit of the State from the capital of the companies concerned; conditions regarding governance including dividend ban and remuneration caps for senior management; prohibition of cross-subsidisation and acquisition ban and additional measures to limit competition distortions; transparency and reporting requirements.

The Temporary Framework enables Member States to combine all support measures with each other, except for loans and guarantees for the same loan and exceeding the thresholds foreseen by the Temporary Framework. It also enables Member States to combine all support measures granted under the Temporary Framework with existing possibilities to grant de minimis to a company of up to €25,000 over three fiscal years for companies active in the primary agricultural sector, €30,000 over three fiscal years for companies active in the fishery and aquaculture sector and €200,000 over three fiscal years for companies active in all other sectors. At the same time, Member States have to commit to avoid undue cumulation of support measures for the same companies to limit support to meet their actual needs.

Furthermore, the Temporary Framework complements the many other possibilities already available to Member States to mitigate the socio-economic impact of the coronavirus outbreak, in line with EU State aid rules. On 13 March 2020, the Commission adopted a Communication on a Coordinated economic response to the COVID-19 outbreak setting out these possibilities. For example, Member States can make generally applicable changes in favour of businesses (e.g. deferring taxes, or subsidising short-time work across all sectors), which fall outside State Aid rules. They can also grant compensation to companies for damage suffered due to and directly caused by the coronavirus outbreak.

The Temporary Framework will be in place until the end of December 2020. As solvency issues may materialise only at a later stage as this crisis evolves, for recapitalisation measures only the Commission has extended this period until the end of June 2021. With a view to ensuring legal certainty, the Commission will assess before those dates if it needs to be extended.

The non-confidential version of the decision will be made available under the case number SA.57659 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved. New publications of State aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

More information on the Temporary Framework and other action the Commission has taken to address the economic impact of the coronavirus pandemic can be found here.

State aid: Commission approves €300 million Italian direct grants scheme to support internationally active companies affected by the coronavirus outbreak | EU Commission Press

The European Commission has approved a €300 million aid scheme to companies registered in Italy engaged in international activities and operations and whose activities have been particularly affected by the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework. The aid will take the form of direct grants. The aim of the scheme is to help these companies  counter the liquidity shortage notably resulting from the economic impact of the coronavirus outbreak, thus ensuring the continuation of their activities. The measure will support eligible companies, but will not take the form of export aid contingent on export activities as it is not tied to concrete export contracts. On the contrary, it finances the general activity of the beneficiaries by facilitating their access to liquidity. The Commission found that the Italian scheme is in line with the conditions set out in the Temporary Framework. In particular, the aid will not exceed the amount of €800 000 per undertaking and the scheme is limited in time until 31 December 2020. The Commission concluded that the measure is necessary, appropriate and proportionate to remedy 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. On this basis, the Commission approved the measure under EU State aid rules. More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.57891 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.

State aid: Commission approves modified €2 billion Greek repayable advance scheme to support companies affected by coronavirus outbreak | EU Commission Press

The European Commission has found certain amendments to an existing Greek scheme to support companies affected by the coronavirus outbreak to be in line with the Temporary Framework. The original scheme was approved on 7 April 2020 under case number SA.56815. Greece notified certain modifications to the original scheme, in particular: (i) an increase in the estimated total budget of the scheme, from €1 billion to €2 billion; (ii) the inclusion of more categories of companies that are eligible to receive aid and; (iii) an extension of the period, in relation to which the aid may be granted, i.e. from March to May 2020 (it was limited to March 2020 in the original scheme). It is estimated that more than 100,000 companies will be able to benefit from the modification of the existing scheme. Furthermore, following the recent amendment of Temporary Framework , the amended scheme also allows micro and small enterprises to benefit from the measure even if they were considered in difficulty on 31 December 2019 under certain conditions. The Commission concluded that the scheme, as modified, remains necessary, appropriate and proportionate to remedy 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. On this basis, the Commission approved the measure under EU State aid rules. More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.58047 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.

Coronavirus: Commission concludes talks to secure future coronavirus vaccine for Europeans | EU Commission Press

The European Commission has concluded exploratory talks with a pharmaceutical company to purchase a potential vaccine against COVID-19. The envisaged contract with Sanofi-GSK* would provide for an option for all EU Member States to purchase the vaccine. It is envisaged that, once a vaccine has proven to be safe and effective against COVID-19, the Commission would have a contractual framework in place for the purchase of 300 million doses, on behalf of all EU Member States. The Commission continues intensive discussions with other vaccine manufacturers.

President von der Leyen said: The European Commission does all in its power to ensure that Europeans have rapid access to a vaccine that is safe and protects them from coronavirus. Today’s step with Sanofi-GSK is a first important cornerstone of a much broader European Vaccines Strategy. More will follow soon. We are in advanced discussions with several other companies. While we do not know today which vaccine will work best in the end, Europe is investing in a diversified portfolio of promising vaccines, based on various types of technologies. This increases our chances to obtain rapidly an effective remedy against the virus. A vaccine would be a truly global good. We are committed to help secure access also for more vulnerable countries to find their way out of this crisis.”

Stella Kyriakides, Commissioner for Health and Food Safety, said: “A safe and effective COVID-19 vaccine is the surest exit strategy from the crisis. For that reason, we have been negotiating a united EU approach to secure doses of promising vaccine candidates in recent weeks. Today’s announcement of the conclusion of exploratory talks with Sanofi-GSK is the first important step in this direction, to provide equal access to the vaccine for our citizens.”

The exploratory talks concluded today are intended to result in an Advance Purchase Agreement to be financed with the Emergency Support Instrument, which has funds dedicated to the creation of a portfolio of potential vaccines with different profiles and produced by different companies.   

The European Commission is also committed to ensuring that everyone who needs a vaccine gets it, anywhere in the world and not only at home. No one will be safe until everyone is safe.

This is why it has raised almost €16 billion since 4 May 2020 under the Coronavirus Global Response, the global action for universal access to tests, treatments and vaccines against coronavirus and for the global recovery. 

The Commission is also ready to explore with international partners if a significant number of countries would agree to pool resources for jointly reserving future vaccines from companies for themselves as well as for low and middle-income countries at the same time. The high-income countries could act as an inclusive international buyers’ group, thus accelerating the development of safe and effective vaccines and maximise access to them for all who need it across the world.

Background

The European Commission presented on 17 June a European strategy to accelerate the development, manufacturing and deployment of effective and safe vaccines against COVID-19. In return for the right to buy a specified number of vaccine doses in a given timeframe, the Commission would finance part of the upfront costs faced by vaccines producers in the form of Advance Purchase Agreements. Funding provided would be considered as a down-payment on the vaccines that will actually be purchased by Member States.

Since the high cost and high failure rate make investing in a COVID-19 vaccine a high-risk decision for vaccine developers, these agreements will therefore allow investments to be made that otherwise would simply probably not happen.

Sanofi-GSK’s vaccine candidate is planning to seek marketing authorisation from EMA in June 2021, following Phase III clinical trials yielding the induction of a promising immune response.

More Information

EU Vaccines Strategy

EU Coronavirus Response