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The European Commission has approved a BGN 500 million (approximately EUR 255 million) public guarantee scheme in support of small and medium-sized enterprises (SMEs) in the context of the coronavirus pandemic. The plan was approved under the Temporary State Aid Framework adopted by the Commission on March 19, 2020 and amended on April 3, 2020.
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Coronavirus epidemic (COVID-19) 4751
Bulgaria informed the Commission, referring to the Temporary Framework, of a guarantee plan of BGN 500 million (approximately EUR 255 million) for existing or new loans to support companies affected by the outbreak of a coronavirus pandemic (the so-called “Program” in loan guarantees for the benefit of SMEs “).
After the capital of the Bulgarian Development Bank has been raised through state funds for BGN 500 million (€ 255 million), it will provide public guarantees for investment loans and working capital loans for micro, small and medium companies affected by the outbreak of the pandemic. coronavirus in Bulgaria.
The scheme aims to limit the risk associated with loans to companies most affected by the economic impact of the current crisis. It will help companies meet their immediate working capital and investment needs and ensure they have sufficient liquidity to continue their operations.
The Commission considered that the Bulgarian regime fulfilled the conditions established in the Temporary Framework. In particular: (i) for each company, the amount of the loan in question is limited to what is necessary to cover its liquidity needs in the foreseeable future, (ii) the guarantees will be provided only for the end of the year, (iii ) the guarantees will be limited to a maximum (iv) the guarantee covers a maximum of 80% of each loan, and (v) the guarantee premiums do not exceed the levels established in the Temporary Framework.
Therefore, the Commission concludes that the regime is necessary, appropriate and proportionate to overcome serious difficulties in the economy of a Member State in accordance with Article 107 (3) (b) of the TFEU and with the conditions set out in the Time frame.
On this basis, the Commission approved the measures under the EU state aid rules.
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