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Coronavirus COVID-19

Special Information Briefing COVID-19 (No. 21): Key details on the fourth tranche of the guarantee facility provided in RDL 8/2020 and 15/2020

20/05/2020

In this Information Briefing, we analyse the Fourth Tranche of the Guarantee Facility, as set out in the Council of Ministers' Resolution.

As part of the measures adopted to alleviate the economic effects of the COVID-19 pandemic, on 20 May 2020, the Spanish Council of Ministers’ Resolution dated 19 May 2020 was published (the “Council of Ministers’ Resolution”) which approved the implementation and the terms and conditions of the fourth tranche of the Official Credit Institute’s (“ICO”) guarantee facility for the amount of EUR 20 billion to guarantee the debt (new or existing) granted to SMEs and selfemployed individuals by certain regulated institutions in the financial sector (the “Fourth Tranche”).

The Council of Ministers’ Resolution implements one of the measures initially established in Royal Decree-Law 8/2020, of 17 March, on urgent extraordinary measures to deal with the economic and social impact of COVID-19 (“RDL 8/2020”), consisting of the approval of a guarantee facility on behalf of the State, for a total amount of up to EUR 100 billion, initially intended to guarantee the debt (existing or new) of companies and self-employed individuals with respect to certain regulated institutions in the financial sector in relation to certain working capital and liquidity needs of such companies and self-employed individuals, in order to mitigate the adverse effects of a liquidity crisis in the business community caused by COVID-19 (the “Guarantee Facility”).

For further information on the measures included in the aforementioned RDL 8/2020 and the key details of the Guarantee Facility, please consult our Information Briefing of 18 March 2020, which can be found here.

The entire content of the Information Briefing can be found in the PDF.

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