The Line of Guarantees has been approved with an endowment of up to 100,000 million euros, although the first tranche activated yesterday has an amount of 20,000 million euros, of which 50% will be reserved to guarantee loans to the self-employed and SMEs.
This line of guarantees will be managed through the Official Credit Institute (ICO) and will endorse the financing granted by credit institutions, financial credit institutions, electronic money institutions and companies and self-employed payment entities. Its objective is to cover new loans and other forms of financing and renewals granted by financial institutions to companies and the self-employed to meet the financing needs derived, among others, from payment of wages, invoices, the need for money or other liquidity needs, including those derived from maturities of financial or tax obligations.
With this line of guarantees, the Government provides an opportunity to access economic liquidity for companies in the cultural and sports sector. In the case of the cultural sector, it is mainly made up of a fabric of small and micro-companies (only 0.7% of companies have more than 50 workers).
80% of new loans and renewals of financial operations will be guaranteed
The main characteristics of the line of guarantees are the following:
- The companies and self-employed affected by the economic effects of COVID-19 may request it, provided that the applicants were not in default on December 31, 2019 or in bankruptcy procedure on March 17, 2020. The guarantees will be retroactive and may requested for operations formalized after the entry into force of Royal Decree-Law 8/2020, which occurred on March 18.
- The guarantee will guarantee 80% of new loans and renewals of operations requested by freelancers and SMEs. For the rest of the companies, the guarantee will cover 70% of the new loan granted and 60 of the renewals.
- The guarantee issued will be valid for the term of the loan granted, with a maximum term of five years. The cost of the guarantee, between 20 and 120 basic points, will be assumed by the financial entities.
- Interested companies and freelancers may request the guarantee for their operations until September 30, 2020. To do this, they must contact the financial entities with which the ICO has signed the corresponding collaboration agreements.
- Financial institutions undertake to keep the costs of new loans and renewals that benefit from these guarantees in line with the costs applied before the start of the COVID-19 crisis. They also undertake to maintain, at least until September 30, 2020, the limits of the working capital lines granted to all clients and, in particular, to those clients whose loans are guaranteed.
Regarding its application in the sports field, it should be noted that sports entities (sports clubs and Sports Federations) are defined mostly as non-profit entities, and can be included in the concept of SMEs. According to the guide drawn up by the European Commission, since 1 January 2005, a company is considered to be "any entity, regardless of its legal form, that carries out an economic activity". The determining factor, therefore, is economic activity, not legal form. In practice, this means that people who are self-employed, family businesses, associations, companies or any other entity that carries out an economic activity on a regular basis can be considered companies.
Economic activities will not be considered as those that do not entail some type of pecuniary compensation (for example, scholarships, grants and donations); or, those for which there is no specific or direct market; or those for which it is not possible to differentiate the income generated from the personal income of its partners or shareholders.
Attention to the demands of the sector
ArchiveThe Ministry of Culture and Sports works with the other ministerial departments to guarantee that the transversal measures in the labor, economic and tax field that the Government is adopting are adapted to the particularities of the cultural and sports sector.
Likewise, after the round of talks held with the main associations in the sector, the Ministry is working to adapt the lines of aid that it grants to new circumstances, so that it meets the current needs derived from the serious health crisis that we are suffering worldwide.
As an example, among the lines of work being developed include those of the National Institute of Performing Arts and Music, that studies to reprogram the interrupted activities with the objective of fulfilling its commitments with the artists whose activity has been suspended. Work is also underway on a reformulation of the PLATEA program to guarantee the sustainability of the theater, music, dance and circus companies. In the same way, efforts will be made to accelerate the nominal grants to the main national institutions of the sector.
Relaunch and support once the COVID-19 crisis is over
The Ministry of Culture and Sports is working on a nationwide campaign to support culture to attract citizens to cultural activity after overcoming the serious situation we are in at the moment, a cultural activity that is essential to preserve the values of a democratic, critical and caring society. Solidarity that culture is showing these days.
Bet on access to online culture: #LaCulturaEnTuCasa
During the application of the Alarm State, the Ministry of Culture and Sports, with the Museums and Archives dependent on the Department, with the National Library and the Spanish Film Archive, is making a great effort so that citizens can continue to access culture and cultural assets, even if they cannot physically access them.
On the one hand, all the Museums under the Ministry of Culture and Sports are reinforcing their websites and increasing their presence on social networks. In this way, the public can access a significant part of the Museum collections, of the activities already carried out and of the exhibitions already closed. In addition, the Ministry is preparing virtual exhibitions for the coming months. The State Archives are also preparing special exhibitions and websites to spread specific documentary blocks. The National Library is reinforcing its online bibliographic collections to ensure that citizens can know it, enjoy it and study it, and Filmoteca Española is promoting the dissemination through films of the Spanish film heritage and complementary activities on it.
