Government measures in key jurisdictions 3rd edition final - Flipbook - Page 116
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Loans and
financial
support
•
– net indebtedness limit for the Spanish Official Credit Institute (ICO) raised by 10€ billion, to
increase ICO facilities providing funding to companies and the self- employed, and
– the guarantee will cover 80% of new financing operations and renewals for self-employed and
SMEs (defined as companies with less than 250 employees, and with an annual turnover that does
not exceed EUR 50 million or with an annual balance sheet that does not exceed EUR 43 million).
For all other companies, the guarantee will cover 70% in the event of new loan operations and
60% for renewals.
Has the
government put in
place any new
bank funding
schemes?
Employment
What financial
support is the
government
providing
to businesses and to
individuals on
employment
116
Government will grant up to €100 billion in guarantees for funding provided by credit
institutions. In this respect:
•
There is no limit to the amount of guarantee per beneficiary, subject to EUs state aid rules. The
insurance premiums may vary whether the beneficiary is an SME or a non-SME, in accordance
with de minimis EU regulations.
•
The Spanish Export Credit Agency (CESCE) has been authorised to provide insurance cover
amounting up to €2 billion for the working capital credit facilities needed by SMEs (excluding
micro-companies that are those with less than 10 employees and with an annual turnover or
annual balance sheet that does not exceed €2 million) and bigger non-listed companies.
•
There is no requirement that the use of the funds be linked to the performance of export
contracts and should respond to new financing needs and not to pre-crisis situations. The
percentage of credit risk cover shall not exceed 80%.
•
The sums in the Fund for “Red Cervera” Technical Provisions and R&D&I projects are allowed to be
used to cover any risks that the Centre for Technological and Industrial Development (CDTI) may
incur by providing loans to finance R&D&I projects of small and medium enterprises, and of midcap companies.
•
Royal Decree Law 19/2020 (“
”) introduces a special legal regime for moratorium
agreements offered by lenders. The regulation requires that these agreements -in order to benefit
from the provisions established in RD 19/2020- are the result of the lender's adherence to a
sectoral framework agreement for deferred payment promoted by the associations representing
financial institutions, which must be communicated to the Bank of Spain.
•
For further information regarding these moratoriums, please visit here.
•
For more information, please visit: Royal Decree-Law 8/2020 of March 17, 2020 launches urgent
and extraordinary measures to confront the economic and social impact of Covid-19, Preserving
and increasing liquidity in the time of Covid-19, and Covid-19: Recommendations for accessing the
financing facilities offered under Royal Decree-Law 8/2020
•
•
Extension of furloughs procedures (“ERTEs”) due to force majeure until June 30, 2020. Royal Decree
Law 18/2020 (“RD 18/2020”) allows the ERTEs due to force majeure, as well as the exemptions from
social security payments to be extended until June 30, 2020 and also defines, inter alia, new
exemptions in relation to social security contributions, the scope of the job retention obligation, as
well as certain restrictions on the distribution of dividends of companies that have used an ERTE due
to force majeure. The provision that dismissals on grounds related to COVID-19 cannot be upheld is
also extended until June 30, 2020. For further information, please visit here.
Furlough procedures (“ERTEs”) as a temporary solution: The conditions for processing ERTEs have
eased and can be processed much quicker. ERTEs can be processed in case of force majeure and
economic, technical, organisational and production-related grounds arising from COVID-19. On May
1, 2020 the Spanish Directorate General of Labour (Dirección General de Trabajo) issued an
interpretation report related to the gradually cease of force majeure furloughs. For more
information, please visit here.
Government measures in key jurisdictions