European Commission approves €300 million Swedish and Danish subsidised interest rate loans to SAS in context of coronavirus outbreak

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The European Commission has approved a Swedish and Danish aid measure of approximately €300 million (SEK 3 billion) to support the aviation company Scandinavian Airlines System (SAS) in the context of the coronavirus outbreak. The aid was approved under the State aid Temporary Framework.

The aim of the measures is to provide SAS with the liquidity support it needs following the deterioration of its cash flow due to the new travel restrictions and containment measures imposed by Denmark and Sweden in order to limit the new waves of the virus as of September 2020. The aid will take the form of loans (€150 million granted by Sweden and €150 million granted by Denmark) with subsidised interest rates, with a maturity of maximum five years.

The Commission found that the scheme is in line with the conditions set out in the Temporary Framework.

In particular, the aid

(i) does not exceed neither double the annual wage bill nor 25% of the total 2019 turnover of SAS,

(ii) will not be granted later than 31 December 2021, and

(iii) will be used only for investment or working capital needs.

The measure is also proportionate in light of the State aid already received by SAS in the context of the coronavirus outbreak, as these previous measures are not sufficient to address SAS’ current liquidity needs.

On this basis, the Commission concluded that the measure is necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State, in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. More information on actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here.

The non-confidential version of the decision will be made available under the cases numbers SA.63250 and SA.63898 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.

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