The EU Stimulus Package - IMPLEMENTATION OF NEXT GENERATION EU & REINFORCEMENT OF MULTIANNUAL FINANCIAL FRAMEWORK 2021-2027 - DLA Piper
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The EU Stimulus
Package
IMPLEMENTATION OF NEXT GENERATION EU & REINFORCEMENT
OF MULTIANNUAL FINANCIAL FRAMEWORK 2021-2027
THE EU STIMULUS PACKAGE
Content
Instruments of Next Generation EU 04
Outlook 06
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Introduction
As of 05 August 2020
In reaction to the COVID-19-Pandemic and its economic and social impacts,
the EU and its Member States have to adopt emergency measures. At the request
of the Heads of State or Government, the Commission presented a very-wide
ranging package. From July 17th to 21st, the European Council deliberated on
the proposal of the Commission in a special meeting.
The temporary package shall provide an emergency “Next Generation EU” (NGEU)
instrument of EUR750 billion and a reinforced “Multiannual Financial Framework”
(MFF) for 2021-2027 with a special focus on a green, digital and resilient Europe.
In the following, the instruments of the NGEU are presented on the basis of
the conclusions of the special meeting published by the European Council on
July 21st 2020.
The implementation of the MFF 2021-2027 is planned for January 2021.
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THE EU STIMULUS PACKAGE
Instruments of Next Generation
EU (NGEU)
1. Recovery and Resilience 2. ReactEU
Facility (RRF) The programme offers a commitment to support
NGEU shall contain a Recovery and Resilience Facility to key sectors, which will be crucial in laying the
be used for investments and reforms for recovery and foundations for a robust recovery in certain Member
resilience, including in relation to the green and digital States following the COVID 19 pandemic. The grants
transitions, in line with the objectives identified in the will be used for employment subsidies, short time work
European Semester. schemes and youth employment measures; liquidity
and solvency of SMEs.
Within the scope of the RFF, the Member States shall
submit national Recovery and Resilience plans as The allocations will be measured based on the severity
part of their National Reform Programmes. The main of the economic and social impact of the crisis in the
criterion of the plans shall be investments and reforms respective Member State. NGEU will provide additional
considering the strengthening of growth potential, allocations for Luxembourg (EUR100 million) and
job creation and economic and social resilience. Malta (EUR50 million).
Furthermore an effective contribution to the green and
digital transition shall be made. The grants and loans 3. Horizon Europe
will be used for the implementation of the national The programme is supporting research and innovation
recovery and resilience plans of the Member States. in the fields of health and climate protection.
The national plans shall be assessed by the Commission
regarding the criteria within two month. Thereafter, 4. InvestEU
the assessment of the plans shall be approved by the The fund is uniquely suited to mobilising investment
Council based on wether the criteria are met. and supporting Union policies during the recovery in
areas such as sustainable infrastructure, innovation
The facility shall be available to all Member States but will and digitisation. The EIB group and other national
specifically target the Member States most affected and promotional banks will provide an EU budget guarantee.
where resilience needs are the greatest. The allocation The programme is demand driven and available to all
key for 2021-2022 shall be etsablished according to a Member States.
Commission proposal. In the allocation key for the year
2023 the 2015-2019 unemployment criterion is replaced,
in equal proportion, by the loss in real GDP observed over
2020 and by the cumulative loss in real GDP observed over
the period 2020-2021 and will be calculated by 30 june
2022. As a rule, the maximum volume of the loans for each
Member State will not exceed 6.8 % of its GNI.
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5. Rural Development 7. RescEU
The programme is supporting farmers and rural areas RescEU is the civil protection mechanism of the Union.
in the necessary structural changes in line with the Aim of the programme is the reinforcement of the
European Green Deal. Union’s civil protection support capacity to respond to
large-scale emergencies. The programme is available to
6. Just Transition Fund (JTF) all Member States.
The programme supports the transition towards climate
neutralilty. The increasment intends to alleviate the
socio-economic impacts of the transition in the regions
most affected.
Recovery and Resilience
Facility (RRF)
Recovery and Resilience Facility
ReactEU of EUR672.5 billion (of which
Additional increase of the cohesion EUR360 billion loans and
policy ReactEU by EUR47.5 billion EUR312.5 billions grants to
Member States)
RescEU Rural Development
NGEU shall
Reinforcement of the programme Reinforcement of the budget for
contain
RescEU by EUR1.9 billion the European Agricultural Fund
for Rural Development (EAFRD)
by EUR7.5 billion
Just Transition Horizon Europe
Fund (JTF) Budget of the programme
InvestEU
Reinforcement of the programme by Horizon Europe by EUR5 billion
Additional increase of the programme
EUR10 billion
InvestEU by EUR5.6 billion
5THE EU STIMULUS PACKAGE Outlook The European Comission will work closely with the European Parliament to finalise an agreement on the future frame work and the accompanying sectoral programmes. Given the need for swift development of the recovery support, it is important to create the right conditions for the rapid implementation of investment project, particulary in infrastructure. The Commission is invited to come forvard before the October European Council with proposals on how to accelerate and facilitate procedures in Member States. 6
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7DLA Piper is a global law firm operating through various separate and distinct legal entities. Further details of these entities can be found at dlapiper.com. This publication is intended as a general overview and discussion of the subjects dealt with, and does not create a lawyer-client relationship. It is not intended to be, and should not be used as, a substitute for taking legal advice in any specific situation. DLA Piper will accept no responsibility for any actions taken or not taken on the basis of this publication. This may qualify as “Lawyer Advertising” requiring notice in some jurisdictions. Prior results do not guarantee a similar outcome. Copyright © 2020 DLA Piper. All rights reserved. | AUG20 | A06730
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