Table of Contents of the article
–The Government has adopted developments in ICO 2020 loans with the intention of help small and medium-sized businesses financiallythat were profitable and viable prior to the COVID-19 crisis, and autonomous that run the risk of disappearing due to the problems they are going through to cope with the payment of debts due to lower billing.
Posted on November 18 in the Official State Gazette, this Royal Decree of the Executive authorizes extensions for ICO loan guarantees, moratoriums for bankruptcy declarations, and more time to be able to hold telematic meetings without statutory evidence; it encourages participation in alternative financing markets and protects, even more, national strategic sectors.
⇨ News ICO loans 2020
Royal Decree-Law 34/2020 of November 18, 2020 includes the extension of ICO loans and the possibility of extending the maturity and grace period for debtors. This measure was being negotiated by the Third Vice-Presidency with the European Commission and which has received the approval of Brussels.
The maximum term of maturity of ICO loans will be three years, with a limit of eight, and an additional year of grace period will be added, up to a total of two years.
The amount endorsed by the Government with ICO credits It has reached 81,787 million euros and in total it has mobilized some 107,600 million with the signing of 876,000 operations, 98% of these with SMEs and the self-employed.
In 2020, the Ministry has approved two programs to get more liquidity to SMEs and the self-employed:
- An ICO loan program of 100,000 million euros, placed in its entirety and granted for a term of five years, with a grace period.
- A second program for 40,000 million, still open to contracting with a more reduced provision by companies and freelancers. For this plan the application period is extended until June 30.
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⇨ Contests of creditors of companies year 2021
The Government, with the aim of avoiding an avalanche of company tenders from January 1, has established that companies will not be obliged to request the voluntary tender until March 14, i the creditors will not be able to request it before that date either.
In the event that non-compliance requests had begun to be processed between October 31 (previous time limit) and November 19, the judge must suspend their processing.
The courts shall suspend until January 31 incidents due to non-compliance with debt resolution agreements linked to previous bankruptcies, if those non-compliance with payment obligations are related to difficulties derived from the pandemic.
The Bank of Spain already warned last week that, in the absence of extensions, from January there would be a “significant rebound” in requests for the necessary bankruptcies, at the request of creditors.
≫ ICO 2020 rescue plan for hospitality and tourism
The Government notes with concern how the second wave of Covid It is hitting the hospitality and tourism sectors with special virulence as they are the most affected due to mobility restrictions.
At this moment, on the government’s negotiating table, there are several options that may see the light in the coming weeks.
The measures that are being considered are: the exoneration, postponement or bonus of contributions, a tax moratorium, renegotiation of rents and, including, a German-style direct aid scheme.
≫ Alternative Financing for companies
Another novelty in these ICO loans is that the capitalization threshold set out in the Securities Market Law is raised from 500 to 1,000 million euros, from which a company is obliged to request that the trading of its shares go from being done exclusively in a growing SME market to doing it in a regulatory market.
In this way, it is intended to encourage the development of alternative financing markets.
≫ General meetings of companies 2021
I also know extends the term of validity during the year 2021 so that general meetings or shareholders’ meetings may be held by electronic means, when not provided for in their statutes.
The requirement that the secretary recognize the identity of the partners or associates, and this is stated in the minutes and, in the case of listed stock companies, the holding of the general meeting is still allowed anywhere in the national territory. Likewise, and for the same reasons, the possibility of holding meetings of the board of trustees of foundations by telematic means is extended for the year 2021.
≫ News for foreign investments
Until June 30, investments from the European Union will also require prior authorization from the Government.
These are investments that are either intended for listed companies, or that exceed 500 million euros and are aimed at unlisted strategic companies. In the case of investments of non-EU origin, prior control is maintained ‘sine die’.
The Government will suspend operations when the investor, extra-community or also community, now hold a stake equal to or greater than 10% of the share capital of a Spanish company that operates in a strategic sector, or when due to the corporate operation, act or legal business, control of it is taken.
At Investa we are always up to date with the latest tax, legal and labor developments that may affect companies, freelancers and individuals to always provide the best service to our clients.
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