State aid: Commission approves Danish umbrella scheme to support uncovered fixed costs of companies affected by coronavirus outbreak

The European Commission has approved a Danish umbrella scheme to support the uncovered fixed costs of companies affected by the coronavirus outbreak. The budget of the scheme is €94 million (approximately DKK 700 million) per month. The scheme was approved under the State aid Temporary Framework. Under the scheme, the support will take the form of direct grants. The scheme will be open to companies active in all sectors, with the exception of those active in the financial sector. The aid will be granted to companies that suffered a decline of turnover of 30% in a period from1 March 2020 to 30 June 2021, compared to the same period in 2019, provided that in this period they were directly affected by governmental restrictive measures to limit the spread of the virus. The beneficiaries will receive grants up to 70% of their uncovered costs during the eligible period, or 90% in the case of small and medium-sized enterprises. The purpose of the scheme is to mitigate the economic difficulties and the sudden liquidity shortages that the beneficiaries are facing due to the restrictive measures imposed by the government to limit the spread of the virus. The Commission found that the Danish scheme is in line with the conditions set out in the Temporary Framework. In particular, the aid (i) will not exceed €3 million per company; (ii) will cover uncovered fixed costs incurred during a period comprised between 1 March 2020 and 30 June 2021; and (iii) will be granted before 30 June 2021. The Commission concluded that the measure is necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State, in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. On this basis, the Commission approved the measure under EU State aid rules. More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.60094 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved. The full press release is available online.