This article is presented to you in association with the European Commission.
The European Commission has approved a € 400 million Dutch loan program to support companies offering package travel and related travel services in the context of the coronavirus outbreak (known as “Voucherfonds”). The scheme was approved as state aid Temporary frame.
Executive Vice President Margrethe Vestager, in charge of competition policy, said: “Many consumers have had their package travel canceled and received vouchers in return, which could not be redeemed given the protracted coronavirus crisis. This € 400 million Dutch loan program will enable companies offering package travel and related travel services in the Netherlands to reimburse consumers for the value of these vouchers in cash. We continue to work closely with Member States to find viable solutions to mitigate the economic impact of the coronavirus outbreak, in line with EU rules. “
The Dutch support measure
The Netherlands has notified the Commission under the Temporary Framework of a EUR 400 million loan scheme to support companies offering package travel and related travel services in the Netherlands.
Since the outbreak began in March 2020, companies offering package travel and related travel services in the Netherlands and other Member States have issued vouchers (called ‘corona vouchers’) to consumers whose package tours had to be canceled due to coronavirus outbreak. Due to the long-term effects of the outbreak on the travel market, many of these corona vouchers could not be redeemed for a new travel package at a later date.
The loan program aims to enable beneficiaries to provide consumers with a cash refund equal to the value of the corona voucher, if they so request.
The scheme, which will apply to the entire territory of the Netherlands and will be open to companies of all sizes, will be managed by Stichting Garantiefonds Reisgelden (SGR).
Under the program, beneficiaries will be eligible for a loan covering a maximum of 80% of their corona checks in circulation and, in any event, not exceeding EUR 50 million per beneficiary.
The loans can only be used for the redemption of corona vouchers from consumers. In this regard, other liquidity needs that beneficiaries may face in the context of the coronavirus outbreak cannot be met under this loan program.
The Commission found that the Dutch loan scheme complied with the conditions set out in the temporary framework. In particular, (i) the loan contracts will be signed no later than December 31, 2021, (ii) the annual flat-rate interest rates for the loans, which will increase as the loan matures, respect the levels minimum set in the temporary framework, and (iii) the loan cannot be granted to medium and large companies which were already in difficulty on December 31, 2019.
The Commission has concluded that the measure is necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State, in accordance with Article 107 (3) (b) TFEU and with the conditions set out in temporary supervision.
On this basis, the Commission authorized the aid measure under EU state aid rules.
The Commission adopted a Temporary frame allow Member States to use all the flexibility provided by state aid rules to support the economy in the context of the coronavirus outbreak. The temporary framework, as amended on April 3, May 8, June 29, October 13 2020 and January 28, 2021, provides for the following types of aid, which may be granted by Member States:
(I) Direct grants, equity injections, selective tax advantages and advance payments up to € 225,000 to a company active in the primary agricultural sector, € 270,000 to a company active in the fishing and aquaculture sector and € 1.8 million to a company active in all others sectors to meet its urgent liquidity needs. Member States may also grant zero-interest loans or loan guarantees covering 100% of the risk, up to the nominal value of EUR 1.8 million per enterprise, except in the primary agricultural sector and in the fishing and aquaculture sector, where the limits of € 225,000 and € 270,000 per company respectively apply.
(ii) State guarantees for loans taken out by companies to ensure that banks continue to provide loans to customers who need them. These state guarantees can cover up to 90% of the risk on loans to help businesses meet their immediate working capital and investment needs.
(iii) Public subsidized loans to companies (senior and subordinated debt) with advantageous interest rates for companies. These loans can help businesses meet their immediate working capital and investment needs.
(iv) Guarantees for banks channeling state aid to the real economy that such aid is seen as direct aid to the customers of banks, and not to the banks themselves, and provides guidance on how to ensure minimal distortion of competition between banks.
(v) Short-term public export credit insurance for all countries, without it being necessary for the Member State in question to demonstrate that the country concerned is temporarily “not marketable”.
(v) Support for research and development (R&D) related to the coronavirus to face the current health crisis in the form of direct subsidies, reimbursable advances or tax advantages. A premium may be granted for cross-border cooperation projects between Member States.
(vii) Support in building and scaling test facilities to develop and test products (including vaccines, ventilators and protective clothing) useful in fighting the coronavirus epidemic, until the first industrial deployment. This can take the form of direct grants, tax breaks, repayable advances and lossless guarantees. Companies can benefit from a bonus when their investment is supported by more than one Member State and when the investment is concluded within two months of the granting of the aid.
(viii) Support for the production of relevant products to fight the coronavirus epidemic in the form of direct grants, tax breaks, repayable advances and lossless guarantees. Companies can benefit from a bonus when their investment is supported by more than one Member State and when the investment is concluded within two months of the granting of the aid.
(ix) Targeted support in the form of deferred payment of taxes and / or suspensions social security contributions for the sectors, regions or types of businesses most affected by the epidemic.
(X) Targeted support in the form of wage subsidies for employees for companies in sectors or regions that have suffered the most from the coronavirus epidemic and would otherwise have had to lay off staff.
(xi) Targeted recapitalization assistance non-financial corporations, if no other suitable solution is available. Safeguards are in place to avoid undue distortions of competition in the single market: conditions of necessity, opportunity and size of the intervention; conditions of entry of the State into the capital of companies and remuneration; the conditions for the exit from the State of the capital of the companies concerned; the conditions of governance, including the prohibition of dividends and the ceilings of remuneration for senior management; the prohibition of cross-subsidies and the prohibition of acquisitions and additional measures to limit distortions of competition; transparency and reporting requirements.
(xii) Coverage of uncovered fixed costs for companies facing a decrease in turnover during the eligible period of at least 30% compared to the same period of 2019 in the context of the coronavirus epidemic. The aid will contribute to part of the fixed costs of beneficiaries who are not covered by their income, up to a maximum amount of 10 million euros per company.
The Commission will also allow Member States to convert until 31 December 2022 repayable instruments (e.g. guarantees, loans, repayable advances) granted under the Temporary Framework into other forms of aid, such as direct grants, provided that the conditions for temporary supervision are met.
The temporary framework allows Member States to combine all support measures with each other, with the exception of loans and guarantees for the same loan and exceeding the thresholds provided for by the temporary framework. It also allows Member States to combine all the support measures granted under the temporary framework with the existing possibilities of granting a de minimis amount to a company of up to € 25,000 over three financial years for companies active in the sector. primary agricultural sector, 30,000 euros over three years for companies active in the fishing and aquaculture sector and 200,000 € over three years for companies active in all other sectors. At the same time, Member States must undertake to avoid the undue accumulation of support measures for the same companies in order to limit the support to their real needs.
In addition, the Temporary Framework complements the many other possibilities that Member States already have to mitigate the socio-economic impact of the coronavirus outbreak, in line with EU state aid rules. On March 13, 2020, the Commission adopted a Communication on a coordinated economic response to the COVID-19 epidemic expose these possibilities. For example, Member States can make changes of general application in favor of businesses (for example, deferring taxes or subsidizing part-time work in all sectors), which are not covered by the rules on employment. state aid. They can also grant compensation to companies for damage suffered as a result of and directly caused by the coronavirus epidemic.
The temporary framework will be in place until the end of December 2021. In order to ensure legal certainty, the Commission will assess before this date whether it should be extended.
The non-confidential version of the decision will be available under file number SA.62271 in the State aid register on the Commission competetion website once privacy issues are resolved. New publications of State aid decisions on the Internet and in the Official Journal are listed in the Weekly electronic news from the competition.
More information on the temporary framework and the other measures the Commission has taken to deal with the economic impact of the coronavirus pandemic can be found here.