EU backs France's €300 billion in aid to businesses hurt by coronavirusChristian Fernsby ▼ | March 21, 2020
The European Commission has approved three French State aid schemes to support the French economy in the context of the coronavirus outbreak.
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The Commission approved the French schemes within 48 hours from the entry into force of the Temporary Framework.
France notified to the Commission three separate support schemes under the Temporary Framework.
Two schemes enabling the French public investment bank Bpifrance to provide State guarantees on commercial loans and credit lines, respectively, for enterprises with up to 5,000 employees.
A scheme to provide State guarantees to banks on portfolios of new loans for all types of companies.
This is direct aid to the companies that will enable banks to quickly provide liquidity to any company that needs it.
The French plan is expected to mobilise more than €300 billion of liquidity support for companies affected by the economic impact of the Coronavirus outbreak.
The Commission found that the French measures are in line with the conditions set out in the Temporary Framework.
In particular, they cover guarantees on loans with a limited maturity and size.
They also limit the risk taken by the State to a maximum of 90%.
This ensures that support is swiftly available at favourable conditions and limited to those who need it in the current situation.
To achieve this goal, the measures also involve minimum remuneration and safeguards to ensure that the aid is effectively channelled by the banks to the beneficiaries in need.
The Commission concluded that the measures are necessary, appropriate and proportionate. ■