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Covid-19: Special report

In the face of the COVID-19 epidemic, the players in the Paris Financial Centre are committed to both supporting companies, particularly SMEs, and to prepare a way out of the crisis, and to adapt their internal organisation to this exceptional situation.

Regarding the support of companies and preparation of the next steps :

  • Following the announcement made by the President of the French Republic on 16 March 2020, all professional networks members of the French banking federation (FBF), in collaboration with Bpifrance, launched on Wednesday 25 March an unprecedented initiative allowing the State to guarantee loans worth 300 billion euros. These loans will enable companies and professionals facing the impact of the health emergency to relieve their cash flow.
  • In a joint press release, the organisations representing investors (AFG, ASPIM, Caisse des Dépôts et Consignations, CNCC, FSIF and UNPI), called on 21 March for their members to suspend the collection of rents and charges from 1 April 2020.
    These measures will be applied automatically for SMEs whose business was interrupted by the decree of 15 March 2020. The situation of companies whose activity, without being interrupted, has been severely damaged by the crisis will be studied on a case-by-case basis.
    When business resumes, these rents and charges will be deferred without penalty or interest.
  • Similarly, another initiative  of solidarity was announced on 19 March by the French insurance federation (FFA) and its members, who agreed to keep as guarantee the contracts of companies in difficulty in case of late payment following the pandemic, for the entire duration of the containment period. The objective is to allow the most affected professionals to continue their activity while remaining covered for their insured risks.

Many players have welcomed the announcements by President Macron on the economic emergency plan and have made a point of announcing their mobilisation during this period of containment.

  • The Banque de France is ensuring the continuity of its mission of public service missions for businesses and individuals. All its teams are mobilised to support businesses and direct them towards the schemes put in place by the government to support them.
  • The French banking federation (FBF) has highlighted that banks, in all their business lines and particularly through their networks, are fully mobilised. In particular, they have reminded all their advisers of the importance of providing the best possible support to their professional, entrepreneurial and corporate clients.
  • In a message of support for companies faced with this unique situation, France Invest has emphasised three key points: the protection of employees (France Invest has switched to remote working and all its activities have been suspended until further notice), solidarity with the population (a practical information kit is available on their website) and the adoption of a responsible attitude towards all stakeholders (employees, invested companies, investors, public authorities).
  • Despite the closure of their premises, the employees of the French Asset Management Association (AFG) are working remotely and a hotline has been set up.
    Meetings of committees and working groups continue to take place by telephone and video-conference.
  • Paris EUROPLACE is continuing the work of its committees and working groups. The physical meetings of its working groups have been replaced by telephone and video meetings.
    Preparations continue for the next International Financial Forum in July in Paris and Infra Week in October. For its part, the Finance Innovation Cluster is continuing its work with Fintech companies and Finance for Tomorrow is making progress on the organisation of its Climate Finance Day, which will take place on 29 October 2020.
  • Finally, trade union confederations (CFDT, CGT, FO, CFE-CGC, CFTC) and employers' organisations (MEDEF, CPME, U2P) met on 19 March.
    In this context of a major health crisis, they intend to assert the essential role of social dialogue and collective bargaining and call on the public authorities and companies to implement all the necessary means to protect the health and safety of employees who have to work. They salute the commitment of public service agents and employees who are particularly indispensable, including, of course, those who work in the health sector, but also those who contribute to the continuity of supply.

Regarding the stock markets :

  • The French Financial Markets Authority (Autorité des Marchés Financiers - AMF) has indicated that its teams are concentrating their efforts on business continuity. Most of them are working remotely but fully operational, they invite institutions to use their usual contacts to report any difficulties. Establishments are invited to regularly consult the AMF website where communications from the AMF or the European authorities will be published / relayed.
  • For its part, Euronext, the Eurozone main stock exchange, has done everything possible to keep its market infrastructures operational, while safeguarding the safety of its employees.
    Markets are and will remain open, and their proper functioning is guaranteed.
  • Euroclear's main concern is the protection of its employees, its assets and those of its clients. Euroclear has taken appropriate measures to ensure the continuity of its activities. Its staff works remotely, social distancing measures are in force and despite the exceptional volumes traded on the financial markets, the company is doing well.

In the face of this unprecedented health crisis and its economic consequences, the Government is taking measures to preserve the continuity of economic activity and the sustainability of businesses and jobs.
To this end, the Ministy of State for the Digital Sector, the General Secretariat for Investment and Bpifrance are joining forces to specifically support French start-ups and on Tuesday 24 March announced an emergency support plan of nearly 4 billion euros.
Start-ups can thus benefit from specific measures:

  1. An envelope of 80 million euros, financed by the “Programme d'investissements d'avenir” (PIA) and managed by Bpifrance, in order to finance bridges between two fundraisings.
  2. State-guaranteed treasury loans that can specifically go up to twice the 2019 France payroll or, if higher, 25% of annual turnover.
  3. Accelerated reimbursement by the State of corporate tax credits refundable in 2020, including research tax credits (CIR) for the year 2019, and VAT credits.
  4. Accelerated payment of the PIA innovation aid already allocated but not yet paid out, for an estimated total amount of €250 million.

Finally, the State maintains, through Bpifrance, its support for innovative companies with nearly 1.3 billion euros of aid for innovation planned for 2020.