EU Prolongs State Aid Framework

The European Commission has prolonged the application of State Aid rules which were set to expire at the end of 2020, in order to minimise the economic impact of the COVID-19 outbreak on companies. Many of the rules have been prolonged by one year, in order for the Commission to carry out fitness checks and evaluate how the State Aid Rules can best be adapted to fit with the priorities set in the European Green Deal and European Industrial Strategy.

After consulting with Member States and in order to counter adverse effects of the corona virus crisis, the Commission has also made further changes to the rules being prolonged and to the State Aid framework for research and development to “allow companies which entered into difficulties as a result of the coronavirus outbreak, and which would not, under existing rules, be able to receive certain types of aid, to remain eligible to receive aid.. for a set period of time during and after the crisis” and has also “introduced certain targeted changes to the existing rules to ensure that job losses that a company may incur due to the coronavirus outbreak would not be considered as a relocation and hence a breach of the commitments previously undertaken.” Full details concerning the measures can be found here.

Ref. CFE’s Tax Top 5 – 6 July 2020

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