Special Information Briefing COVID-19 (No. 27): Royal Decree-law 25/2020 of 3 July on urgent measures to support economic recovery and employment

On 6 July 2020, Royal Decree-law 25/2020 of 3 July on urgent measures to support economic recovery and employment, (“RDL 25/2020”), was published in the Official State Bulletin and entered into force on 7 July. RDL 25/2020 establishes a series of measures, mainly of an economic nature, which expand upon and enhance those already adopted by means of the Royal Decree-laws approved in recent months to promote economic recovery following the end of the state of alarm approved by virtue of Royal Decree 463/2020 of 14 March, which declared the state of alarm for the management of the health crisis caused by COVID-19 (“Royal Decree 436/2020”), and its respective extensions.

Among other measures, RDL 25/2020 (i) provides for the creation of a fund to support the solvency of strategically important companies; (ii) approves a guarantee facility aimed at encouraging financing for investment; and (iii) includes a package of measures to support the tourism sector, including the approval of a moratorium on the payment of the principal of loans secured by mortgages on property used to operate businesses in the tourism sector.

We will briefly analyse these measures in this Special Information Briefing.

1. Solvency support fund for strategically important companies

RDL 25/2020 creates a fund to support the solvency of strategically important companies (the “Fund”), which will be initially endowed with EUR 10 billion and whose objective is to provide temporary public support to strengthen the business solvency of non-financial companies that are considered strategically important to national or regional business sectors, and that have been affected by the COVID-19 pandemic.

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