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Commission approves €130 million Danish guarantee scheme for SMEs affected by coronavirus

Christian Fernsby |
The European Commission has found a DKK 1 billion (approx. €130 million) Danish guarantee scheme for small and medium sized enterprises (SMEs) affected by Coronavirus outbreak to be in line with EU State aid rules.

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The schemes were approved under the State aid Temporary Framework to support the economy in the context of the COVID-19 outbreak adopted by the Commission on 19 March 2020.

The Commission approved the Danish scheme within 48 hours from the entry into force of the Framework.

Denmark notified to the Commission a guarantee scheme for SMEs affected by the Coronavirus outbreakunder the Temporary Framework.

It has a budget of DKK 1 billion (approx. €130 million).

The scheme aims at limiting the risks associated with issuing operating loans to those companies that are most severely affected by the economic impact of the Coronavirus outbreak.

The objective of the measure is to ensure these companies can continue their activities faced with the difficult situation caused by the coronavirus.

The Commission found that the Danish measures are in line with the conditions set out in the Temporary Framework.

They cover guarantees on operating loans with a limited maturity and size, and limit the risk taken by the State to a maximum of 70%.

This ensures that support is swiftly available at favourable conditions and limited to those who need it in this unprecedented 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 that the Danish guarantee scheme for SMEs will contribute to managing the economic impact of the coronavirus in Denmark.

The measures are necessary, appropriate and proportionate.

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