[Saaster]

Firms applying for Danish state aid must promise not to pay dividends or make share buy-backs in 2020 and 2021. Companies would be allowed to pay dividends again if they pay back the aid.

This makes perfect sense, otherwise it's a textbook case of socializing the losses and privatizing the profit. Paying dividends (and stock buybacks) is a trade-off that companies make, that makes the company less resilient. Risk/reward needs to work in both ways, both in terms of gains as well as losses.

[bigfudge]

I personally don't see why it's such a limited time frame.

[ed312]

Agreed - repayment of the loan/bailout should be the contingency. Your business has wild post-COVID success? Great! Pay back your bailout and start issuing dividends! No moral hazard in returning capital in a successful business.

[smnrchrds]

Thank you for the explanation.

[rvnx]

Can't say it better.