Commission approves €10 billion Spanish fund to provide debt and capital support to companies affected by the #Coronavirus outbreak

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 strategic companies active in Spain affected by the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework.

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. 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) 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.

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 €10bn 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.”

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