State aid: Commission approves €40 million Maltese support scheme to grant interest rate subsidies to companies

The European Commission has approved a €40 million Maltese interest rate subsidy scheme to support companies facing acute liquidity shortages due to the current coronavirus outbreak. The scheme was approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020 and 8 May 2020. The purpose of the scheme is to address the liquidity needs of companies of all sizes in Malta. The support will take the form of an interest rate subsidy by covering the interest costs on the initial two years of a loan, which will result in lower interest rates for the borrower. Consequently, the measure will mitigate the pressure on the liquidity and financial sustainability of Maltese companies. This measure follows the €350 million guarantee scheme, which was approved on 2 April 2020. The Commission found that the Maltese scheme is in line with the conditions set out in the Temporary Framework. In particular, the aid (i) cannot exceed the maximum amounts as defined in the Temporary Framework, and (ii) will be applicable until 31 December 2020. On this basis, the Commission approved the measure under EU State aid rules. More information on the Temporary Framework and other action the Commission has taken to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.57163 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.