Austria's Ministry of Finance has issued a release calling for the temporary suspension of EU State aid law in order to allow for quicker responses to the COVID-19 crisis.
Corona Aids: Blümel demands temporary suspension of EU state aid law
On 22 April 2020, Finance Minister Gernot Blümel and Minister of Economic Affairs Margarete Schramböck address the EU Commission, specifically the responsible Vice-President Margrethe Vestager, in a joint letter. In the letter, the two ministers emphasise the Austrian demand for a temporary suspension of the EU state aid rules.
Gernot Blümel comments: "Times of crisis must not be times of bureaucracy. What applies at the national level must apply at the European level as well. We want to help with Austrian tax money so that companies can get through the crisis better and many jobs are secured. The current situation is about speed. We must now calculate in hours and days, rather than weeks. We therefore call for a temporary suspension of the EU state aid rules. Austria is being asked for solidarity, in that we should make Austrian tax money indirectly available to other countries as well, so that they can cope better with the crisis. Therefore I call, conversely, for solidarity with Austrian companies and employees as well. We are striving for the permission to support also the Austrian location with Austrian tax money, and to do so quickly and unbureaucratically."
Press Release of 20.04.2020
Phase 2 of the hardship fund starts today, 100-% guarantees from the Republic have been officially available since last week. Finance Minister Blümel is calling for a temporary suspension of EU state aid law so that stopgap aid to domestic companies can be provided even without EU approval.
"In such a crisis, it is necessary that we all close the ranks, work together and support each other. This is how we as the Federal Government see our task," said Finance Minister Gernot Blümel at today's press conference on the current support measures for the economy. "Much has already happened and quite some money been spent on the support measures of the Austrian Federal Government. After one month, emergency aid and liquidity to the amount of € 5.7 billion have already been financed. If short-time work is included into the consideration, here around € 10 billion have already been disbursed. To date, € 121 million from the hardship fund have been paid out to affected parties," said Blümel. Under EU state aid law, many aid measures currently require EU approval. In order to ensure that support measures can be provided to domestic companies in times of crisis even without authorisation, this aid law is now to be temporarily suspended. "It is not appropriate to apply the same amount of bureaucracy now as may be expedient in other times. In Europe, we have already shown flexibility regarding instruments to support other EU countries. We want to act in solidarity with our own companies as well," said Finance Minister Blümel. "Solidarity is not one way only. Our businesses must be helped in this crisis just as quickly and flexibly as other countries in the EU are currently being helped. That is why we need to suspend the state aid rules for the time of anti-corona measures," demands Finance Minister Blümel.
100-% guarantees of the Republic
"Here in Austria we are one of the pioneers in Europe; there are only 3 countries within the European Union that assume such 100-% liability on the part of the state. With 100-% liability, we are able to quickly offer companies the possibility of bridging liquidity bottlenecks. In the meantime, more than 600 applications have been filed here, which is a liability volume of more than € 100 million euros," said Finance Minister Blümel about the instrument of state guarantees. Austrian banks have an important role to play in the field of guarantees. They are now called upon to facilitate swift and unbureaucratic granting of credit. "I would like to take this opportunity to expressly thank all the bank employees who are in direct contact with customers. A big 'thank you' for everything that has been achieved so far," said Finance Minister Blümel. Today also marks the start of the 2nd phase of the hardship fund. Upper as well as lower earnings limits are abolished, additional income is possible, multiple insurance is permitted. All these exclusion criteria will be waived in the second phase, and a total of up to € 6,000 will be available for each affected person.