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Denmark has said companies that make payouts to shareholders, buy back their own shares or are registered in tax havens won’t be eligible for taxpayer cash from its Covid-19 bailout.

The country's finance ministry said that businesses looking to claim the cash "must pay the tax to which they are liable under international agreements and national rules".

"Companies based on tax havens in accordance with EU guidelines cannot receive compensation, insofar as it is possible to cut them off under EU law and any other international obligations," it added.

Dividends are payments made by publicly-listed companies to their investors.

Share buybacks see companies buy shares in themselves, often this is seen as an attempt to raise the value of stock in a company, but it also diverts cash from being reinvested into the business and reduced the amount of cash they have on hand to weather hard times.

Some UK firms have been announced that they will not be paying dividends this spring, including British Gas, Serco and building firms Persimmons and Taylor Wimpey.

(Image: Getty Images)

Britain’s largest banks also agreed to scrap nearly £8bn worth of dividends after the intervention of the Bank of England.

It also ordered lenders to cancel plans for cash bonuses for executives.

Barclays, HSBC, Lloyds, Royal Bank of Scotland and Standard Chartered have confirmed that they would temporarily halt shareholder payouts and share buybacks for 2019 and throughout 2020.

In America, companies who accept Federal loans will be banned from buying back shares for up to a year until they have paid back the taxpayer.

According to a report by the thinktank Common Wealth, Britain’s biggest companies handed out almost half a trillion pounds in dividends and share buybacks in the years before the coronavirus crisis struck.

They warn that Britain's corporate culture, which saw around £400bn was paid in dividends and £61bn of cash returned to investors in share buybacks between 2011 and 2018 by the 100 biggest UK companies, priorities making executives richer at the expense of meaningful businesses contributing to the economy.

They warn that this corporate cash-grab may have undermined British companies ability to survive the crisis.

The think tank's director Mathew Lawrence told the Guardian: “Shifts in ownership and company rules have turned the corporation into an engine of wealth extraction for senior management and shareholders. "Companies have become less resilient and more unequal as a result.

“But how the company operates isn’t ‘natural’ or set in stone. We can design new rules and transform ownership to make business democratic and sustainable – and build a better post-crisis economy.”

Denmark is loosening its lockdown with day care centres reopened and schools following this week.

Restaurants and cafes will remain closed and gatherings of more than 10 people banned until 10 May.

Larger public gatherings will be prohibited until August.

The country has confirmed 7,384 cases of the virus, with 355 deaths.