The EC Proposes Companies to Receive State Credit of up to 5% of their Annual Turnover
Companies in the European Union affected by the coronavirus crisis can apply for a government loan of up to 5% of their annual turnover for 2019.
Another criterion is for the loan to cover up to 40% of the the beneficiary's annual wage bill.
However, such debt will be evaluated with a lower priority in the event of a bankruptcy and liquidation of the company, which makes it more risky and therefore with more serious requirements for disbursement.
This is a European Commission proposal under discussion and its parameters may change, according to a Reuters source familiar with the progress of the initiative. t
EU competition regulators await comment from national authorities.
Several EU countries have sought the opportunity to implement such a measure, other agency sources say.
The EU executive has in recent weeks relaxed its state aid rules and approved trillions of euros via guaranteed loans, grants, subsidised interest rates and short-term export credit insurance offered to virus-hit companies across the bloc.
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