European Commission approves preliminary assessment of Spain’s fourth payment request under the Recovery and Resilience Mechanism

The Commission has endorsed a positive preliminary assessment of 60 out of the 61 milestones and targets linked to Spain’s fourth payment request for €10 billion (net of pre-financing) under the Recovery and Resilience Facility, the centrepiece of NextGenerationEU.

Positive preliminary assessment of all but one target

The payment request covers important steps in the delivery of 34 reforms and 26 investments that will drive positive change for citizens and businesses in Spain in the areas of the green and digital transitions, the pension system, research, development and innovation, education and vocational training, employment, digitalisation of public services, forestry and water management, and inter-territorial cooperation.

Flagship measures in this payment request include:

• Reforms benefitting SMEs and businesses: Spain adopted two laws, one on Business Creation and the second one on Start-ups. These new rules aim to facilitate the creation and growth of highly innovative start-ups, as well as attract foreign entrepreneurs and investors. These reforms are expected to foster Spain’s competitiveness.
• Forestry investments to restore coastlines: Spain approved the Spanish Forest Strategy and restored more than 200 km of riverbanks to the benefit of over 40,000 people, who are now better protected against flood risks.

Activation of suspension procedure

The Commission found that one target has not been fulfilled at this stage. It concerns investments in business digitalisation (C13.I3/T201, ‘agents of change’).  The Commission is therefore activating the ‘payment suspension’ procedure, as foreseen by Article 24(6) of the RRF Regulation.

In line with the RRF Regulation and as explained in the Communication on implementation published on 21 February 2023, this procedure gives Member States additional time to fulfil outstanding milestones, while receiving a partial payment linked to the milestones that have been satisfactorily fulfilled.

Halfway through its lifetime, the Recovery and Resilience Facility continues to deliver across the EU through ambitious reforms and investments

Next steps

The Commission has now sent its positive preliminary assessment of the milestones and targets that it considers satisfactorily fulfilled to the Economic and Financial Committee (EFC), which has four weeks to deliver its opinion.

In parallel, the Commission has communicated to Spain the reasons why it considers the target on the investments in business digitalisation is not satisfactorily fulfilled. Spain now has one month to submit its observations to the Commission.

Following the EFC’s opinion on the positive preliminary assessment and after assessing the observations submitted by Spain, the Commission will adopt a payment decision, after which the payment to Spain can take place.

Should the Commission, following Spain’s observations, confirm its assessment that the target in question has not been satisfactorily fulfilled, it will suspend part of the payment. The suspended amount is determined by applying the Commission’s methodology for payment suspensions (outlined in Annex II of the Communication published on 21 February 2023), which applies to all Member States.

From that moment, Spain will have a period of six months to fulfil the outstanding milestone. At the end of this period, the Commission will assess whether the target has been satisfactorily fulfilled. If so, it will lift the suspension and proceed with the payment of the suspended amount,

Background

The Spanish recovery and resilience plan comprises 111 reforms and 142 investments in 595 milestones and targets. It amounts to €163 billion, of which €79.8 billion in grants and €83.2 billion in loans.

More information on the Spanish plan, including a map of projects financed by the RRF in Spain, is available here.

More information: European Commission