EU Clears Romanian Plan To Help Companies With Financing Difficulties

The scheme allows authorities to grant aid in the form of subsidized guarantees for investment and working capital loans concluded by the end of 2010.

The scheme meets the conditions of the Commission’s Temporary Framework for state aid measures to support access to finance in the current financial and economic crisis, because it is limited in time, respects the relevant thresholds and applies only to companies that were not in difficulty on July 1, 2008, the Commission said.

"The Romanian measure facilitates access for firms to loans. This is an effective way of encouraging business investment and economic recovery without unduly distorting competition," Competition Commissioner Neelie Kroes said.

The reduction of the guarantee fee can be applied during a period of up to two years for loan guarantees contracted no later than December 31, 2010. Where the duration of the underlying loan exceeds two years, the guarantee premiums may be applied for an additional maximum period of four years.

The scheme does not apply to firms that were already in difficulty on 1 July 2008 (before the credit crunch), the Commission also said.

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