The European Commission has allowed temporary nationalization of enterprises due to coronavirus

The European Commission has allowed EU countries to partially nationalize particularly affected businesses from the crisis associated with the coronavirus pandemic. Some news agencies reported this.

Nationalization will be possible under some conditions. So, firms will have to refuse to pay dividends and bonuses. Large companies should set out in detail what they are spending the aid they receive, as well as “whether this will contribute to the EU’s goals of moving to a green and digital economy.”

In General, state intervention in the economy should be in the “public interest,” the European Commission reported. In particular, to avoid the reduction of a large number of jobs or prevent the bankruptcy of an innovative or system-forming enterprise.

During nationalization, a strategy for the “exit” of the state from the capital of enterprises should also be prescribed. If the country participates in the company’s capital for more than six years, a restructuring plan must be provided.

The German Economy and Energy Minister Peter Altmaier said this was an essential step for “additional flexibility” in providing financial assistance to the economy. “Our goal is to achieve success after the end of the crisis,” the Minister added.

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