Royal Decree-Law 19/2020 of 26 May adopting complementary measures in agricultural, scientific, economic, employment, social security and tax matters to mitigate the effects of COVID-19

OFFICIAL STATE BULLETIN No. 150 Wednesday, 27 May 2020 Sec. I. Page 34486 I. GENERAL PROVISIONS HEAD OF STATE 5315 Royal Decree-Law 19/2020, of 26 May, adopting complementary measures in agricultural, scientific, economic, employment and Social Security and tax matters to mitigate the effects of COVID-19. I. Background, motivation and measures The epidemiological situation that has generated a health crisis as a result of COVID-19 in Spain has forced the adoption of public health measures that have altered the normality in the development of social, economic and productive relations. In particular, it can be highlighted how the suspension of all non-essential activities and the limitations on the performance of many others have generated a significant increase in cyclical unemployment and a reduction in activity among small and medium-sized enterprises and self-employed workers. For this reason, a series of measures have been approved to mitigate their effects, which are now being completed by means of this royal decree-law in the agricultural, scientific, economic, labor and Social Security and tax fields. A. Measures in the agricultural field In the agricultural sector, there has been a marked lack of labor, due to the decrease in workers who usually engage in agricultural tasks such as seasonal workers in the Spanish countryside, either due to sanitary restrictions on travel from their countries of origin, or due to the precautions that many of these workers are adopting in view of the evolution of the pandemic, which could end up severely affecting the capacity and conditions of production of a significant part of Spanish agricultural holdings. This reduction in labor force, in turn, could put at risk the current food supply to citizens, which up to now has been developed under conditions of extraordinary variety, quantity and quality. In order to give an adequate response to this situation, Royal Decree-Law 13/2020, of 7 April, adopting certain urgent measures in the matter of agricultural employment, had as its object to favor the temporary hiring of workers in the agricultural sector by establishing extraordinary measures of flexibility of employment, of a social and labor nature, necessary to ensure the maintenance of agricultural activity, during the validity of the state of alarm declared by Royal Decree 463/2020, of 14 March, declaring the state of alarm for the management of the health crisis situation caused by COVID-19, being applicable temporarily until 30 June 2020. Despite the fact that the evolution of the effects of the epidemic has allowed various restrictive conditions of the activity to be modified since then, various factual elements that existed at the time of approval of the norm and that directly affect the productive conditions that justified its approval have been maintained, such as the closure of various borders in countries of origin of a large part of that labor force, the certain risk of contagion that has effects on the voluntary displacement of workers or the need for temporary labor for the summer campaigns, as was the case with the spring ones. It is therefore appropriate to extend the content of the same for three more months, so as to ensure the sufficiency of adequate labor force to attend to the summer agricultural tasks, as an essential part of the food chain. It should also be noted that the measures adopted in the aforementioned royal decree-law have allowed the maintenance of the activity of many holdings, contributing to mitigate the lack of personnel detected especially in the fruit sector in various places in Spain, so it is equally necessary to extend the temporal framework of application of the norm, in order not to eliminate a factor that can help to mitigate this deficit of workers. Thus, in view of the maintenance of the convenience of the application of these measures, it is provided in this royal decree-law the extension until 30 September of the aforementioned Royal Decree-Law 13/2020, of 7 April. Likewise, a specific change is made in Law 3/2001, of 26 March, on Maritime Fishing of the State. In the interest of the principle of proportionality, the first sale of mollusks of size or weight lower than the regulatory one is classified as minor when it is less than ten percent of the total volume sold of that species, considering it an infringement of little entity that would be disproportionately sanctioned –among other things, by carrying the loss of European aid–. B. Measures in the scientific field The European Union is developing an ambitious program to develop Fusion as an energy source, in an unprecedented international collaboration that includes China, South Korea, the United States of America, India, Japan and Russia as fundamental partners through ITER. The European itinerary to achieve the objective of building a Demonstration Power Plant for Fusion Electricity Production (DEMO) contemplates two fundamental elements: the construction and scientific-technological exploitation of the ITER Tokamak in the south of France, and the construction of a neutron source, IFMIF-DONES (International Fusion Materials Irradiation Facility-Demo Oriented NEutron Source) for the development, qualification and licensing of materials capable of withstanding the extreme conditions to which the components of the first wall of the future DEMO fusion reactor will be exposed. IFMIF-DONES consists of a high-power particle accelerator, which strikes a liquid lithium target that, as a consequence, generates neutrons with characteristics similar to those present in a fusion reactor. The construction of IFMIF-DONES is indispensable for the objective of the Union to demonstrate the viability of Nuclear Fusion as an energy source. To strengthen the European character of IFMIF-DONES, the Kingdom of Spain presented in August 2017 the candidacy, with the backing of Croatia and the European Fusion Program, for the Project to be developed in the city of Granada. To boost this candidacy, an inter-administrative working group has been established between the Ministry of Science and Innovation and the Junta of Andalusia, within which the constitution of a consortium has been proposed to allow the development of the activities proper to the ongoing candidacy process, which will presumably extend until 2021. In case of success of the same, said consortium would prolong its existence and would be in charge of providing the support corresponding to Spain, as host country, to the international body that would be constituted for the construction of IFMIF-DONES. By means of this royal decree-law, the constitution of the aforementioned consortium is therefore authorized. Likewise, an exceptional regulation already agreed upon in the matter of genetically modified organisms is updated. It must be taken into account that research is fundamental in the search for tools to prevent, combat or contain infectious agents, processes and situations that can have repercussions for public health, as has happened in the recent Coronavirus epidemic. Considering also the importance of having such tools in the shortest possible time and with the maximum guarantees of safety, it is appropriate to extend, for a period of twelve months, the scope of the measures contemplated in paragraph 3 of the additional seventh provision of Royal Decree-Law 8/2020, of 17 March, of urgent extraordinary measures to face the economic and social impact of COVID-19, expanding its content to all activity of special interest for health, so as to ensure the maximization of its possibilities in favor of research and health. In this way, for the cve: BOE-A-2020-5315 Verifiable at https://www.boe.es

OFFICIAL STATE BULLETIN No. 150 Wednesday, 27 May 2020 Sec. I. Page 34487 research within the framework of existing needs, reducing to five days the period of public information and simplifying procedures to improve efficiency and reduce administrative burdens. C. Measures in the economic field Additionally, a series of economic measures that do not admit delay are incorporated into this royal decree-law. First, the economic recovery measures must also reach the telecommunications sector, with the objective that this sector, which has proven so crucial in moments of home confinement and reduced mobility and which has made possible, among many other things, the performance of remote health care actions, the provision of social services, teleworking, distance education, e-commerce, e-Administration, as well as guaranteeing the right to information and access to leisure activities of the population in Spain, can recover all its competitive strength and commercial dynamism. Royal Decree-Law 8/2020, of 17 March, of urgent extraordinary measures to face the economic and social impact of COVID-19, adopted a battery of important and necessary urgent measures of an extraordinary nature to face the economic and social impact of COVID-19, including measures in the matter of telecommunications. Among them is that established in its article 20, pursuant to which the subscriber's ease of changing operator while keeping their telephone number was suspended exceptionally and temporarily in order to reduce personal interaction between operator agents and subscribers and preserve health. This measure has helped to contain the health crisis by maintaining the provision of electronic communications services and guaranteeing connectivity, but at these moments of gradual economic reactivation, it is appropriate that the telecommunications market recovers full operability and allows again the conservation of the subscriber's number in case of operator change or number portability, which is a first-order instrument for operators to compete with each other freely and, in turn, for citizens to see their capacity for choice reinforced in search of cheaper, more innovative, more complete, higher quality or adapted services to their needs. The suppression of this suspension of portability, returning to the fully competitive previous situation, must be accompanied by the adoption of appropriate measures that facilitate subscribers to be able to satisfy the bills they have not been able to pay for the receipt of electronic communications services during the state of alarm through techniques of flexibility such as the fragmentation and postponement of debts in electronic communications services. For these reasons, it is established for electronic communications operators the obligation to offer a fragmentation and postponement of the debt in which their subscribers may have incurred corresponding to past bills charged from the date of entry into force of the state of alarm until 30 June 2020. The fragmentation and postponement of the debt must be linear over the months postponed, the deadline for making installment payments will be six months, unless the subscriber has freely agreed with the operator a different deadline, whether higher or lower, and no default interest shall accrue nor guarantees shall be required for the fragmentation and postponement. Secondly, Law 26/2013, of 27 December, on Savings Banks and Banking Foundations, was approved within the framework of the Memorandum of Understanding on Conditions of Financial Sector Policy, made in Brussels and Madrid on 23 July 2012, and the Framework Agreement for Financial Assistance, made in Madrid and Luxembourg on 24 July 2012. In point 23, this Memorandum established that: "The Spanish authorities will prepare by the end of November 2012 rules that clarify the function of savings banks in their capacity as shareholders of credit institutions, to ultimately reduce their participation in them to a non-majority level". cve: BOE-A-2020-5315 Verifiable at https://www.boe.es

OFFICIAL STATE BULLETIN No. 150 Wednesday, 27 May 2020 Sec. I. Page 34489 Following this guideline, the aforementioned Law 26/2013, of 27 December, was approved, which establishes a mechanism according to which the old banks, now transformed into banking foundations, which had a controlling participation in a credit institution, had to set up a reserve fund to cover unforeseen events, unless they opted to reduce their participation to levels below control through a disinvestment plan. Royal Decree 877/2015, of 2 October, regulates the reserve fund that certain banking foundations are obliged to constitute. In said norm, the amount, form, deadline and rhythm of constitution of the reserve fund are established. Article 6 provides for a constitution period of the reserve fund of eight years, extendable by the Bank of Spain by an additional year if the banking foundation found difficulties in complying with the deadline as a consequence of the evolution of the economic-financial situation of the participated credit institution or of the development of market conditions. On the other hand, paragraph three of that article provides, as a general rule, a rhythm of endowment of the fund linear in time. By means of the Recommendation of the European Central Bank of 27 March 2020 on the distribution of dividends during the COVID-19 pandemic and repealing Recommendation ECB/2020/1, the European banking supervisor recommends that, at least until 1 October 2020, credit entities abstain from distributing dividends or from incurring irrevocable commitments to distribute them with respect to the 2019 and 2020 financial years. In light of this circumstance, and since the dividends received by banking foundations are their main source of income, it is appropriate to suspend in this year 2020 the obligation to endow the reserve fund and suspend the counting of the constitution period thereof, leaving therefore the pending endowments postponed to the period 2021-2024. This measure is articulated through the approval of a final provision through which an additional provision is introduced to Royal Decree 877/2015, of 2 October, reflecting said suspension, to which another final provision is added to safeguard the regulatory rank of the provision, thus adapting to the principles of good regulation. Thirdly, the COVID-19 pandemic is representing a health emergency with important economic consequences, affecting both productive activity and demand and the well-being of citizens. It is being transmitted to the economies of the countries of the European Union at an unprecedented speed. There has been a temporary interruption of productive activity, supply chains have been affected and there has been a marked decline in consumption and confidence of European economic agents. The recovery of the economies of the European Union will not be immediate or automatic. The European Union faces a symmetric shock that affects the real economy and the productive fabric in all European economies, so it is necessary that a coordinated and forceful response be provided that complements the national measures being adopted by the various countries. To face this situation from the scope of the European Union, a series of measures and programs of support for the business fabric and the financing of Member States are being adopted. Thus, the Eurogroup, in its meeting of 9 April 2020, gave its support to the European Commission's proposal for the establishment of the European Instrument for Temporary Support to Mitigate Unemployment Risks in an Emergency (or SURE Instrument) for a maximum amount of 100,000 million euros, of which 25,000 million euros would have the backing of Member States. Subsequently, in the European Council of 23 April 2020, the Heads of State and Government endorsed the creation of the Instrument, and urged that it be operational by 1 June 2020. Council Regulation (EU) 2020/672, of 19 May 2020, on the creation of a European instrument for temporary support to mitigate unemployment risks in an emergency (SURE) following the COVID-19 outbreak, is the one that regulates its cve: BOE-A-2020-5315 Verifiable at https://www.boe.es

OFFICIAL STATE BULLETIN No. 150 Wednesday, 27 May 2020 Sec. I. Page 34490 creation and characteristics, with the aforementioned objective of granting financial assistance to Member States that are suffering severe economic difficulties due to COVID-19, in order to protect employees and self-employed workers and reduce the impact of unemployment and income losses. The financial aid will take the form of loans granted to Member States that request it to finance employment protection schemes, such as the case of temporary regulation files in the case of Spain. Thus, the State can benefit from financing granted by the European Commission at reduced interest rates, allowing less recourse to capital markets and an improvement in the State's financing conditions, which is expected to result in savings in the interest burden. On the other hand, Member States contribute to the instrument by guaranteeing part of the risk assumed by the community budget with this instrument by granting guarantees, in accordance with the terms agreed between the European Commission and the Member States. Therefore, Member States must formalize the approval, in accordance with their respective regulatory frameworks, of the guarantees that correspond to each case according to their weight in the Gross National Income of the European Union, so that the instrument, with the guarantees granted by all countries, can be operational in the month of June. The contribution of the Kingdom of Spain in this initiative involves granting an irrevocable, unconditional and first-demand guarantee. In this context, this royal decree-law collects the provisions relating to the authorization of the guarantees to be granted, involves Spain's participation in this action in the European field to respond to the COVID-19 crisis and enables the Minister of Economic Affairs and Digital Transformation to sign the corresponding agreements with the European Commission, complementing the national measures adopted by the Government. Due to the importance of the initiative in the current situation and the need for its immediate implementation, this royal decree-law is adopted. On the other hand, what is provided in article 29 of Royal Decree-Law 8/2020, of 17 March, of urgent extraordinary measures to face the economic and social impact of COVID-19, is completed by providing budgetary coverage to the national state guarantee program of 100,000 million euros for the financing of companies and self-employed workers approved by Royal Decree-Law 8/2020, of 17 March. Given the significant size of the program, it is crucial to have the budgetary mechanisms enabled in such a way as to guarantee the solvency of the program from both a financial and operational point of view. Fourthly, Royal Decree-Law 8/2020, of 17 March, of urgent extraordinary measures to face the economic and social impact of COVID-19, enabled in its articles 7 to 17 a legal moratorium regime for borrowers of loans with mortgage guarantee for the acquisition of their main residence. A few days later, this moratorium regime was extended beyond the debts guaranteed with the property intended for the main residence, also covering those loans or credits guaranteed with properties intended for the economic activity developed by entrepreneurs and professionals, as well as those others whose object is the acquisition of housing intended for rent. Along with the moratorium of mortgage credits, the Government also approved a moratorium for any type of financing without mortgage guarantee that any natural person had contracted, both in their capacity as a consumer and in the exercise of their professional activity, pursuant to what is provided in articles 21 to 27 of Royal Decree-Law 11/2020, of 31 March, adopting urgent complementary measures in the social and economic field to face COVID-19. From an objective perspective, the common denominator of these two types of moratoria (mortgage and non-mortgage) is, basically, the temporary suspension of payment obligations and the non-accrual of interest during the time of duration of the moratorium (three months from when it is requested). From a subjective perspective, the common element is that cve: BOE-A-2020-5315 Verifiable at https://www.boe.es

OFFICIAL STATE BULLETIN No. 150 Wednesday, 27 May 2020 Sec. I. Page 34491 these two moratoria established by law are limited to those natural persons in a situation of economic vulnerability. They were conceived not as general access measures intended to mitigate the effects of the possible default of any person, but as an immediate response mechanism for people in a situation of economic vulnerability. The legal moratorium is limited to those who find themselves in the circumstances of vulnerability specifically indicated in article 16 of Royal Decree-Law 11/2020, of 31 March. With the objective of favoring the application of measures and agreements for the postponement of payments of credits and loans with an even broader scope than that initially provided for in the legal moratoria and complementary to these, this royal decree-law incorporates a special regime for moratorium agreements reached between lending entities and their clients. The greater the subjective scope of these debt postponement agreements, the larger the group of people benefited, the smaller the immediate economic impact generated by the pandemic. In the European Union, the European Banking Authority has been promoting the adoption of measures aimed at limiting the economic impact caused by the pandemic and, in particular, the extension of postponements and moratoria from agreements promoted by associations of entities in each Member State, applying, in particular, a favorable accounting and prudential treatment to operations covered by such agreements (EBA Guide GL 2020/02). This Guide has been adopted in the national scope by agreement of the Executive Commission of the Bank of Spain of 19 May 2020. The special moratorium regime provided for in this royal decree-law