Temporary Crisis Framework for State Aid measures to support the economy following the aggression against Ukraine by Russia

Summary:

Communication published by the European Commission on 23 March 2022, setting out a Temporary Crisis Framework aimed at enabling Member States to use the flexibility foreseen under EU State aid rules to support the economy in the context of Russia's invasion of Ukraine.

Further information:

Russia's decision to invade Ukraine in February 2022 was met with shock and condemnation by most international stakeholders. The European Union (EU) engaged in efforts to respond to the aggression with packages of sanctions and other restrictive measures targetting Russia and its ally, the Belarusian regime. Russia reacted by imposing sanctions of its own against the EU Member states. Crucially, the whole situation led to massive displacement of people from Ukraine into EU territory. It also affected supply chains, the agricultural sector, imports and exports, and the energy market. Crucially it also

This Communication specifies the criteria for the assessment of the compatibility with the EU internal market of State aid measures that Member States may take to remedy the economic effects following Russia's invasion of Ukraine, the sanctions and counter-measures in place as a result. The Temporary Crisis Framework recognises that the EU economy is experiencing a serious disturbance. It therefore provides for three types of aid:

• Limited amounts of aid;
• Liquidity support in form of State guarantees and subsidised loans;
• Aid to compensate for high energy prices.

Moreover, this Framework also aims to target support to the economy, while limiting negative consequences to the level playing field in the EU Single Market. It was designed to be in place until 31 December 2022.

Official

European Commission: DG Competition: State Aid: Temporary Crisis Framework (Ukraine) https://competition-policy.ec.europa.eu/state-aid/ukraine_en

European Commission: Statement, 23/03/2022: State aid: Commission adopts Temporary Crisis Framework to support the economy in context of Russia's invasion of Ukraine https://ec.europa.eu/commission/presscorner/detail/en/statement_22_1949

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News

The Irish Times, 19/03/2022: Donohoe indicates he would support easing strict EU rules on state aid https://www.irishtimes.com/news/ireland/irish-news/donohoe-indicates-he-would-support-easing-strict-eu-rules-on-state-aid-1.4830618

Politico, 23/03/2022: EU allows more state aid to companies hurt by Ukraine crisis https://www.politico.eu/article/eu-allows-more-state-aid-to-companies-hurt-by-ukraine-crisis/

EurActiv, 23/03/2022: EU allows up to €400,000 in state aid for companies impacted by Ukraine war https://www.euractiv.com/section/economy-jobs/news/eu-allows-up-to-e400000-in-state-aid-for-companies-impacted-by-ukraine-war/

Reuters, 23/03/2022: EU loosens state aid rules for companies affected by sanctions on Russia https://www.reuters.com/world/europe/eu-loosens-state-aid-rules-companies-affected-by-sanctions-russia-2022-03-23/

Euronews, 23/03/2022: Brussels relaxes state aid rules for companies impacted by war in Ukraine https://www.euronews.com/my-europe/2022/03/23/brussels-relaxes-state-aid-rules-for-companies-impacted-by-war-in-ukraine

Bloomberg, 23/03/2022: EU Loosens Aid Shackles in Bid to Mitigate War’s Hit to Economy https://www.bloomberg.com/news/articles/2022-03-23/eu-loosens-aid-shackles-in-bid-to-mitigate-war-s-hit-to-economy

RTÉ News, 23/03/2022: EU authorises state aid for firms impacted by Ukraine war https://www.rte.ie/news/business/2022/0323/1287953-eu-authorises-state-aid-for-firms-hit-by-ukraine-war/

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Commentary and Analysis

International Road Transport Union (IRU): Newsroom, 24/03/2022: EU state aid crisis framework on Ukraine not enough to stop road transport bankruptcies https://www.iru.org/news-resources/newsroom/eu-state-aid-crisis-framework-ukraine-not-enough-stop-road-transport-bankruptcies

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