BRUSSELS — Corporations within the European Union hit by the coronavirus will be capable of ask for a authorities loan of as much as 5% of their 2019 turnover below a measure proposed by the European Fee, an individual aware of the matter mentioned on Sunday.
A number of EU international locations had requested for such a measure, different sources with direct information of the matter advised Reuters on Saturday, declining to offer particulars.
The dimensions of the loan is also as much as 40% of the beneficiary’s annual wage invoice, the particular person mentioned.
Such loans will likely be thought-about as subordinated debt, ranked under senior debt holders within the occasion of a liquidation. As a consequence of that top danger, there will likely be strict situations tied to such loans.
The cap on turnover or the annual wage invoice might nonetheless change, as EU competitors regulators are looking for suggestions from EU international locations on the proposal.
The EU govt has in latest weeks relaxed its state help guidelines and authorized trillions of euros by way of assured loans, grants, subsidised rates of interest and short-term export credit score insurance coverage supplied to virus-hit corporations throughout the bloc.
(Reporting by Foo Yun Chee; Enhancing by David Clarke and Peter Cooney)