The European Commission has given the green light to the Government’s €200m scheme to support firms through the Covid-19 outbreak.
The commission has found the plan to be in line with EU state aid rules under the temporary framework it has put in place to support the European economy through the crisis.
“With this €200m Irish scheme, approved under the new State aid Temporary Framework, we continue to work with Member States to ensure timely support to the economy through these difficult times,” said Executive Vice-President Margrethe Vestager.
“This measure will, in the form of repayable advances, help companies affected by the coronavirus outbreak to weather this crisis and bounce back strongly afterwards,” Ms Vestager said.
The scheme will allow firms here to access loans if they are experiencing or expect to experience a drop in turnover of at least 15% due to the virus outbreak.
Companies must have ten or more full time employees and be in certain manufacturing sectors and/or internationally traded sectors.
Minister for Business, Enterprise and Innovation Heather Humphreys has welcomed the approval for the scheme, which will be administered by Enterprise Ireland as part of a suite of emergency supports to help Irish companies that are seriously and adversely affected by the Covid-19 pandemic.
In a statement, the Minister said the support will be available to assist companies access the necessary liquidity and funding to sustain their businesses in the short to medium term.
According to the Commission today, the Irish plan is necessary, appropriate and proportionate and will contribute to managing the economic impact of the coronavirus here.
Under the temporary rules adopted by the EU Commission to give member states more leeway when it comes to offering state aid to companies, grants of up to €800,000 may be given to a company to address its urgent liquidity needs.
Member states can also provide guarantees to ensure banks continue to provide loans and may also provide subsidised public loans to firms.
Short-term credit insurance can also be provided as well as safeguards for banks that channel state aid into the economy.
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