In these extraordinary times, economies around the World including Member States are pumping money into their economies. Businesses and whole sectors are crying out for special support. State support in the EEA above a low de minimis threshold is subject to strict state aid rules which requires pre-clearance by the European Commission under strict conditions. Illegally granted state aid can be required to be clawed back. In the context of Brexit, the UK remains bound by the EU state aid rules during the transition period up to the end of December 2020. The Commission has until the end of March 2020 to file challenges to aid granted by the UK. The shape of post-Brexit UK subsidies is unknown.
The Commission has granted speedy clearance to certain state aid applications by a number of member states, including Denmark, Germany, Italy, Portugal and France. It adopted on 19th March 2020 a Temporary Framework for State Aid measures to support the economy during the COVID-19 crisis. It will expire on 31st December 2020. It is focussed on businesses which face difficulties as a result of the pandemic but which were not in trouble on 31st December 2019.
This Temporary Framework is considered in more detail in our State Aid Alert which can be accessed here.