Press Release State aid: Commission authorises the United Kingdom to introduce two temporary measures to grant loan guarantees on one hand, and interest rate subsidies to businesses producing green products on the other hand

The European Commission authorised under state aid rules based on the EC Treaty, two schemes, first notified to the Commission on 10 February 2009, offering loan guarantees and, specifically for businesses investing in the production of green products, interest rate subsidies. The two aid measures allow for a total combined risk exposure of £8 billion in the amounts guaranteed or loaned. They are part of the measures adopted by the UK to tackle the current economic crisis and should help businesses face financing problems because of the credit squeeze. The loan guarantee measure will allow companies to receive State guarantees, at subsidised rates, to raise investment or working capital. As regards interest rate subsidies for green products, the scheme will make it easier for producers to invest in products with an environmental benefit. The scheme will initially concern the car industry, but will be open to all sectors. Both schemes meet the conditions imposed by the Commission’s temporary state aid framework that gives Member States additional possibilities for providing businesses with improved access to financing during the economic and financial crisis, as amended on 25 February 2009. They are therefore compatible with Article 87(3)(b) of the EC Treaty, which permits aid intended to remedy a serious disturbance in the economy of a Member State.

European Commission: MEMO/09/87: State aid: Additional information on guarantees adopted under the Temporary Framework http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/09/87&format=HTML&aged=0&language=EN&guiLanguage=en

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