The EU Commission has approved Malta’s guarantee scheme for working capital loans granted by commercial banks to support companies affected by the COVID-19 outbreak. The scheme has an estimated budget of €350 million. The scheme was approved under the State Aid Temporary Framework to support the economy in the current context.

The Commission found that the Maltese measure is in line with the conditions set out in the Temporary Framework. In particular: (i) the underlying loan amount per company is linked to cover its liquidity needs for the foreseeable future, (ii) the guarantees will only be provided until the end of this year, (iii) the guarantees are limited to a maximum of six years, and (iv) guarantee fee premiums do not exceed the levels foreseen by the Temporary Framework.

Should you have any queries or wish to discuss further, please send an email to covid@kpmg.com.mt.

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