Member States are able to introduce national state aid schemes that mitigate the negative effects of the COVID-19 pandemic by utilizing Articles 107(2)(b) and 107(3)(b) (particularly through the Temporary Framework adopted by the European Commission on 19 March 2020) of the Treaty on the Functioning of the European Union (TFEU).

Denmark was the first state to adopt a national aid scheme under the TFEU Article 107(2)(b) and was approved by the European Commission within a mere 24 hours. The scheme is intended to compensate for the damage caused for cancellations of large public events as a result of COVID-19 concerns.

Other Member States have followed suit adopting their own national state aid measures which so far amount to a total of 14 such measures. The Commission has considered these measures compatible under the aforementioned TFEU Articles relating to aid to remedy a serious disturbance in the economy of a Member State. These Member States include Italy, Spain, Germany, Latvia, Portugal and France, and even the United Kingdom.

Most of the national aid measures adopted are intended to provide liquidity to companies mainly through the granting of guarantees for loans, subsidized public loans, direct grants and repayable advances.

The sectors which have benefitted from the national aid schemes vary according to the particular Member State in question and range across the medical sector, restaurants, the extractive and manufacturing industry,  travel agency, the touristic animation and event organisation sectors, the fishery and aquaculture sector, as well as, the agricultural sector, amongst others.

Many other national state aid measures are expected to be adopted in the future as long as the impacts of COVID-19 remain sufficiently great. We will keep abreast of the developments and keep you updated.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.