The largest aid approved so far by the Commission: The €49 billion German scheme to support the economy in the context of Russia’s war against Ukraine

On December 21, 2022 the Commission approved the €49 billion German scheme to support its national economy, under the State aid Temporary Crisis Framework (‘TCF’).

Potential beneficiaries are companies being final consumers of electricity, natural gas, and heat produced using natural gas and electricity.

The support will be channelled via energy suppliers through monthly instalments in the form of reductions of the electricity, natural gas and heat bills of eligible beneficiaries. Energy suppliers will be then reimbursed by the German state. The total State aid amount granted to each company will be verified at the end of the eligibility period with a clawback mechanism.

The Commission found that the German scheme is in line with the conditions set out in Article 107(3)(b) TFEU and in the TCF. In particular: (i) the individual aid amount which can be granted to companies (including the aid amount for companies particularly affected by the crisis and beneficiaries qualifying as energy-intensive business) does not exceed the different applicable aid ceilings under the TCF Temporary Crisis Framework; (ii) the aid will be granted before December 31, 2023.

More specifically, the individual aid amount will not exceed 50% of the eligible costs for the maximum aid ceiling of €4 million; and for companies particularly affected by the crisis, the individual aid amount will not exceed 40% of the eligible costs for the maximum aid ceiling of €100 million. For beneficiaries qualifying as energy-intensive businesses, the overall aid per beneficiary will not exceed 65% of the eligible costs, or 80% for particularly affected sectors in Annex 1 or the maximum aid ceiling of €50 or €150 million respectively.

The € 6.3 billion euro German recapitalisation measure of SEFE

On December 20, 2022, the Commission approved the 6.3 billion euro State aid granted by Germany to recapitalise the energy company SEFE Securing Energy for Europe GmbH (“SEFE”, the former Gazprom Germania), under Article 107(3)(b) TFEU, in coherence with the principles of the 2022 Temporary Crisis Framework and the principles of the 2014 Rescue and Restructuring Guidelines. The Commission recognised the necessity, appropriateness and size of the intervention in relation to the exceptional situation caused by the war in Ukraine that jeopardizes the viability of the company. This capital injection comes right after the German State took the full ownership of SEFE on November 2022, resulting to 225.6 million euro German aid to SEFE. Considering the considerable size of the aid, the Commission imposed several conditions, among which Germany’s commitments to provide a long-term viability plan, an exit plan, a divestment plan of its business in Switzerland, Romania, Czech Republic, Hungary, Slovakia, Bulgaria and Mexico, and a governance and acquisition ban.