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ARTICLE · 08 APRIL 2020

Coronavirus Aid, Relief, And Economic Security Act (Cares Act): Paycheck Protection Program Summary

A&O Shearman
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On March 31, 2020, the U.S. Department of the Treasury and the U.S. Small Business Administration released a summary of the Paycheck Protection Program, which was enacted into law as part of the CARES Act.

United StatesCoronavirus (COVID-19)
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A&O Shearman
Daniel Mitz
Daniel Mitz
Yeonsue Kim
Yeonsue Kim
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On March 31, 2020, the U.S. Department of the Treasury and the U.S. Small Business Administration (SBA) released a summary of the Paycheck Protection Program (PPP), which was enacted into law as part of the CARES Act. On April 2, 2020, the SBA released an interim final rule on the implementation of the PPP. On April 3, 2020, the SBA released an interim final rule on the application of the affiliation rules to the PPP and a summary of the SBA's affiliation rules relating to the PPP. Below is a summary of the key provisions in the CARES Act and related PPP guidance.

The CARES Act allocated $349 billion for the SBA to guarantee loans to small businesses under the PPP. The loans will be distributed using the existing framework of the SBA's 7(a) loan program, which is a partnership between private financial lenders, which issue the loans, and the SBA, which guarantees them.

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