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Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for measure LU-2022-19/2251 – measures in Luxembourg

Loan guarantees for companies with liquidity issues

Aides sous forme de garantie

Country Luxembourg , applies nationwide
Time period Temporary, 01 May 2022 – 31 December 2022
Context War in Ukraine, Green Transition
Type Legislations or other statutory regulations
Category Supporting businesses to stay afloat
– Access to finance
Author Patrick Thill (LISER) and Eurofound
Measure added 12 May 2022 (updated 07 October 2022)

Background information

The Government is committed to putting in place new aid both in the short term for companies heavily impacted by rising energy prices, and in the short and medium term to support companies in the energy transition and decarbonisation of their activities, in line with European rules on state aid.

In this context, the aid scheme in the form of a guarantee is intended to facilitate access to bank loans for eligible companies that have liquidity needs due to the economic consequences of Russia's aggression against Ukraine.

The aid scheme in the form of guarantees was put in place by the law of 15 July 2022.

Following the example of the scheme put in place at the beginning of the COVID pandemic, the state guarantee could cover up to 90% of the loan.

Content of measure

The bill on the aid scheme was submitted to the Chamber of Deputies on 28 April 2022. It provides for loans to be granted by credit institutions between 1 May 2022 and 31 December 2022 to companies that have liquidity needs due to the economic consequences of Russia's aggression against Ukraine, under the conditions defined by the bill.

The maximum amount of loans eligible for the state guarantee is:

  • 15% of the average total annual turnover of the enterprise over the last three financial years or
  • 50% of the energy costs of the company in the 12 months preceding the month of notification to the Treasury in accordance with Article 4(1) of the draft law.

Where the applicant has been in existence for less than 3 years or 12 months respectively, the thresholds shall be calculated on the basis of the period of existence at the time of notification to the Treasury pursuant to Article 4(1) of the Bill (see attachement: "projet de loi").

The following undertakings are excluded from the scope of application of this law:

  • undertakings which are subject to collective insolvency proceedings under the national law applicable to them
  • undertakings whose main activity consists in the development, holding, renting and trading of real estate
  • undertakings whose principal activity is the holding of participations in other companies.

The State guarantee covers investment loans and working capital loans with a maximum duration of six years.

Use of measure

All companies. No current estimation.

Target groups

Workers Businesses Citizens
Does not apply to workers Applies to all businesses Does not apply to citizens

Actors and funding

Actors Funding
National government
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role No involvement Informed
Form Not applicable Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

  • No involvement
  • Main level of involvement: Company level


Social patners are not involved.

Views and reactions

This measure is part of a package of provisions that have been requested by employer's organisation and trade unions during the Tripartite meeting in March 2022.



Eurofound (2022), Loan guarantees for companies with liquidity issues, measure LU-2022-19/2251 (measures in Luxembourg), EU PolicyWatch, Dublin,


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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.