Α RRF Loans’ overview in Greece
Introduction
The Resilience and Recovery Facility (the “RRF”) has been established by virtue of the Regulation 2021/241 of the European Parliament and of the Council (the “RRF Regulation”) following the COVID-19 outbreak in early 2020 which changed the economic, social and budgetary outlook in the world. RRF’s establishment seemed necessary to provide direct financial support to Member States as an innovative tool to help them stepping up the implementation of sustainable reforms and related public investments. RRF constitutes the core of the temporary recovery instrument, NextGenerationEU, and is the largest EU funding program to date, projected to finally disburse up to €723.8 billion in grants and loans to Member States.
On the 27th of April 2021, the Greek State submitted to the European Commission the National Recovery and Resilience Plan “Greece 2.0” (the “NRRP”) requesting, inter alia, loan support to implement it. On 13 July 2021, NRRP has been approved by means of the implementing decision with No 10152/21, and, the Recovery and Resilience Facility Financing Agreement, dated 20/26 July 2021, has been signed between the Commission and the Greek State, and ratified by the Law 4822/2021 (Gov. Gazette A 135/02.08.2021).
On the 31st of August 2023, the Greek State submitted to the European Commission a modified NRRP, which included (i) modifications concerning 69 measures, (ii) a REPowerEU chapter (based on the EU plan aiming at reducing Europe’s dependence on fossil-fuel and accelerating the transition to green energy because of the Russian invasion in the Ukraine) and (iii) a request for further loan support. NRRP’s revision has been approved on the 8th of December 2023 by means of a new implementing decision of the European Parliament and of the Council with No 15831/1/23. On the 7th of June 2024, the Greek State and the Commission services agreed to modify their operational arrangements to reflect the above new implementing decision.
NRRP’s basic numbers
The revised NRRP includes 103 investments and 76 reforms, utilizing investment resources of 35.95 billion euros (18.22 billion euros in grants and 17.73 billion euros in loans).
NRRP’s pillars:
- Green transition
- Digital transformation
- Employment-Skills-Social Cohesion
- Private Investments and Transformation of the Economy
The Greek State will use the RRF funds to be channeled in loans to finance investments falling in the scope of the following pillars:
- Green transition
- Digital transformation
- innovation, research and development
- development of economies of scale through partnerships, acquisitions and mergers
- extroversy.
The Operational Agreements
Following the NRRP’s approval, the Greek commercial banks signed with the Greek state the so-called Operational Agreements (“OAs”), setting the rules of the allocation of the RRF funds to them and the procedure of the further allocation of the funds to the final beneficiaries through the financing of the RRF investments. The OAs -among others- provide for the assignment to the banks of intermediate services such as the initial eligibility evaluation of the loans, the credit assessment of the relevant loans’ applications, the arrangement, negotiation and signing on behalf of the Greek State of the financing and security agreements and the undertaking of any possible measure for the repayment of RRF loans. The commercial banks grant simultaneously with the RRF Loan the Co-financing loan (the “Co-F Loan(s)”) without RRF funding to cover the total financial needs of the investment plan and they can proceed to amendments, restructuring, waivers, termination and other measures in relation to both RRF and Co-F Loans without Greek State’s consent or approval.
Eligibility Table
Table on basic RRF loans’ approval process, features and terms
Latest news
On the 14th of June 2024, the Commission has endorsed a positive preliminary assessment of Greece’s fourth payment request for €2.3 billion in loans under the RRF and, on the 23rd of July 2024, the Commission disbursed to Greece the above amount of €2.3 billion.
Peggy Bozou
Attorney at Law
LLB, Law School, University of Athens (EKPA)
LLM, Civil Law, Law School, University of Athens (EKPA)
ΜSc in Energy: Strategy, Law & Economics, Piraeus University
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