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European Commission authorises €500m state aid to Croatian companies


Written by Frédéric Dubessy on Tuesday, July 12th 2022 à 14:50 | Read 164 times



The Croatian State wants to encourage private banks to grant loans to companies in difficulty (photo:F.Dubessy)
The Croatian State wants to encourage private banks to grant loans to companies in difficulty (photo:F.Dubessy)
CROATIA. On Thursday 7 July 2022, the European Commission decided to authorise a Croatian state aid scheme under the temporary framework defined on 23 March 2022 by the institution to better respond to crisis situations.

The aid, of up to €500 million, will be used to support companies in all sectors affected by the Russian invasion of Ukraine. With the exception of credit and financial institutions and Russian-controlled entities subject to sanctions.

"At a time when the functioning of the market is severely disrupted, this Croatian scheme (...) will provide sufficient liquidity to companies affected by the current geopolitical crisis by encouraging private banks to grant loans", commented Margrethe Vestager. The European Commission's executive vice-president added: "We stand by Ukraine and its people. At the same time, we continue to work closely with Member States to ensure that national support measures can be put in place in a timely, coordinated and effective manner, while protecting the level playing field in the single market.

 

No more than €400,000 per company

The European Commission has deemed the scheme "necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State". It will in particular compensate intensive users for increases in energy prices (gas and electricity).

Managed by the Croatian Bank for Reconstruction and Development (HBOR - Hrvatska Banka Za Obnovu I Razvitak), this special measure introduced by the Croatian State will be developed in the form of direct loans (limited to six years) for investment or working capital needs, soft loans and interest rate subsidies. The aid, available only until 31 December 2022, may not exceed €35 000 per enterprise active in the agriculture, fisheries and aquaculture sectors. For other enterprises, the ceiling is set at €400,000. 

In addition, the maximum amount must be equal to 15% of their average total annual turnover in the last three closed accounting years, or 50% of the energy costs incurred over a 12-month period preceding the application for aid.



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