ICO line of guarantees for companies and freelancers, to mitigate the economic effects of COVID-19. BOE 03-26-2020.

Through this first tranche, the Ministry of Economic Affairs and Digital Transformation will endorse the financing granted by credit institutions, credit financial establishments, electronic money entities and companies and self-employed payment entities to mitigate the effects on their activity as a consequence of COVID -19.

The guarantees of the Ministry of Economic Affairs and Digital Transformation will be managed through the ICO in the terms provided in this Agreement.

Main applicable conditions and requirements:

Purpose To facilitate the maintenance of employment and mitigate the economic effects of COVID-19, the line of guarantees is intended to cover new loans and other forms of financing and renewals granted by financial entities to companies and the self-employed to meet the derived financing needs , among others, of payment of wages, invoices, need for currency or other liquidity needs, including those derived from maturities of financial or tax obligations.

Eligible loans and risk analysis

Characteristics of eligible loans.

Loans and other operations granted to companies and freelancers who have their registered office in Spain and have been affected by the economic effects of COVID-19, provided that:

The loans and operations have been formalized or renewed after March 17, 2020.

The borrowers are not listed as delinquent when consulting the files of the Bank of Spain's Risk Information Center (CIRBE) as of December 31, 2019.

The borrowers are not subject to insolvency proceedings as of March 17, 2020, either because they have submitted an application for bankruptcy, or because of the circumstances referred to in Article 2.4 of Law 22/2003, of 9 of July, Insolvency, so that the insolvency is requested by your creditors.

Maximum loan amount per client.

Up to a maximum of 1.5 million euros in one or more loan operations for freelancers and companies, the specific provisions of Commission Regulation (EU) No. 1407/2013 of December 18, 2013, will apply the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid.

For loans above 1.5 million euros, up to the maximum established in the Temporary Framework of State Aid of the European Commission for both self-employed and companies that meet the status of SMEs and for companies that do not meet the status of SMEs.

Maximum guarantee percentages:

In the case of SMEs and the self-employed, the guarantee will amount to a maximum of 80% of the operation.

In companies that do not meet the status of SMEs, the guarantee will cover a maximum of 70% of new operations and 60% of renewal operations.

Endorsement request period: Endorsements may be requested until September 30, 2020. The term may be extended, always in line with the EU State Aid regulations, by Council of Ministers Agreement.

Maximum maturity of the guarantee. The term of the guarantee issued will coincide with the term of the operation up to a maximum of 5 years.

Financial entities rights: The financial entity will decide on the granting of the corresponding financing to the client in accordance with its internal procedures and concession and risk policies.