State aid: Commission approves modification of Spanish ‘umbrella’ scheme to support economy in context of coronavirus outbreak, extending it to support uncovered fixed costs of companies

The European Commission has found the modification of the existing Spanish ‘umbrella’ scheme to support the economy in the context of the coronavirus outbreak to be in line with the State aid Temporary Framework. The existing ‘umbrella’ scheme was approved by the Commission on 2 April 2020 (SA.56851) and has been subsequently amended by cases SA.57019, SA.58778 and SA.59196. Spain notified the following modifications to the scheme: (i) an amendment that allows the provision of limited amounts of aid through financial intermediaries; and (ii) a new measure to support the uncovered fixed costs of companies affected by the coronavirus outbreak. Under the new measure, the public support will take the form of direct grants, tax and payment advantages, repayable advances, guarantees, loans and equity. The measure will be accessible to companies of all sizes active in all sectors, excluding the financial one. Its objective is to provide liquidity to companies that are still experiencing a decline in turnover of at least 30% because of the coronavirus outbreak. The Commission found that the amended scheme is in line with the conditions set out in the Temporary Framework. In particular, (i) the support for uncovered fixed costs will not exceed €10 million per company; and (ii) the aid will be granted before 31 December 2021. The Commission concluded that the amended scheme continues to be necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State, in line with Article 107(3)(b) TFEU. On this basis, the Commission approved the measures under EU State aid rules. 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. The non-confidential version of the decision will be made available under case number SA.59723 in the State aid register on the Commission’s competition website.