Cura Italia decree: measures for liquidity through the banking system

Cura Italia decree: measures for liquidity through the banking system

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The Cura Italia Decree-Law of 17.03.2020 also provided for new measures to support the financial liquidity of companies affected by the epidemiological emergency by Covid-19 (art. 49).

In particular, through the Central Guarantee Fund for SMEs and for a duration of 9 months from the entry into force of the decree, a series of measures are applied, among which:

  • the guarantee is granted free of charge
  • the maximum guaranteed amount per company is raised to €5 million
  • no commission is due for failure to finalise financial transactions
  • for real estate investment operations in the tourism, hotel and real estate sectors, with a minimum duration of 10 years and for an amount of more than €500,000, the Fund’s guarantee may be cumulated with other forms of guarantee acquired on the loans
  • all time-limits relating to the administrative formalities concerning operations covered by the Fund guarantee shall be extended for three months

The attached circular lists and details all the measures and indications of the other measures taken.

Among these, the authorization to the MEF to issue the State guarantee in favour of SACE spa (a company active in export credit) to support export credit for all sectors affected by the health emergency and no longer just for the tourism sector.

The Solidarity Fund for “first home” mortgages is also implemented, extending by 9 months the admission to the benefits of the Fund also to self-employed workers and freelancers. For access to the Fund will be sufficient self-certification (no ISEE certificate will be required) of the reduction of more than one-third of turnover in the quarter following 21.02.2020, compared to the last quarter of 2019, due to the closure or restriction of its work due to the Covid-19 emergency.

The Cura Italia decree also provides (art. 55) that a company that sells against defaulting debtors, by 31.12.2020, may transform into a tax credit the assets for deferred tax assets referred to:

  • tax losses not yet computed as a reduction in taxable income at the date of the assignment
  • amount of the notional return exceeding the total net income not yet deducted or enjoyed by means of a tax credit at the date of disposal.

Moreover, in order to support the business activities damaged by the epidemic, companies whose debt exposures are not classified as “impaired” may avail themselves of specific financial support measures (Article 56 of the Cura Italia Decree):

  1. in the case of revocable credit facilities and loans granted against advances on loans on 29.02.2020 or, if higher, the date of publication of this decree, the amounts granted may not be revoked in whole or in part until 30.09.2020, both for the part used and for the part not yet used
  2. for non instalment loans with contractual maturity before 30.09.2020, the contracts, together with the respective ancillary elements, are extended until 30.09.2020 under the same conditions
  3. payments of mortgage instalments, other loans repayable in instalments and lease instalments falling due before 30.09.2020 are suspended until 30.09.2020. In addition, the repayment schedule for the instalments or instalments subject to suspension is deferred, in such a way as to ensure that there are no new or increased charges for both parties; companies are entitled to request the suspension of capital repayments only.

Finally, it should be noted that art. 58 of the Cura Italia decree provides for the suspension for up to 12 months of payments of principal and interest on the instalments of the repayment of the subsidised loans issued through the Fund established by Law 394/1981 expiring in 2020.

Download the circular for all details.

The other measures to support the liquidity of households and businesses adopted by the Cura Italia decree were the subject of another circular prepared by our professionals.