European Commission approves guarantee scheme of up to €530 million to support the Walloon economy in coronavirus outbreak
The European Commission has approved a Belgian scheme of up to €530 million, financed by the Walloon region, to support companies in the context of the coronavirus outbreak through guarantees. The scheme was approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020.
Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “The €530 million guarantee scheme will support companies in the Walloon Region affected by the coronavirus outbreak. The measure will help businesses cover their immediate liquidity needs and continue their activities in these difficult times. We continue working closely with Member States to ensure that national support measures can help mitigate the economic impact of the coronavirus outbreak.”
The support measure for the Walloon region
Belgium notified to the Commission under the Temporary Framework a loan guarantee scheme to support companies active in the Walloon region and affected by the coronavirus outbreak. The measure, with an overall volume of guarantees to be issued of €530 million, aims at limiting the risk associated with issuing or restructuring loans to those companies that are most severely affected by the economic impact of the coronavirus outbreak, ensuring the continuation of activities.
The Commission found that the measure is in line with the conditions set out in the Temporary Framework. In particular, (i) the underlying loan amount per company is limited to what is needed to cover its liquidity needs for the near future, (ii) the guarantee fees and interest rates are in line with the minimum levels laid down in the Temporary Framework, (iii) the guarantees and loans will be provided until the end of this year, with a maximum duration of six years, and (iv) aid may be granted only to companies that were not in difficulty already on 31 December 2019 but were significantly affected by the coronavirus outbreak.
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.