State aid: Commission approves €110 million Czech rent compensation scheme to support businesses affected by the coronavirus outbreak

The European Commission approved a CZK 3 billion (approximately €110.5 million) Czech scheme to support retail businesses and service companies renting premises, which were limited or forbidden to carry out their activities due to the measures imposed by the government in the context of the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework. The public support, which will take the form of direct grants, will cover 50% of the rent due for the months of July, August and September 2020. The purpose of the scheme is to mitigate the liquidity shortages that the affected companies are facing due to the measures taken by the Czech government to limit the spread of the coronavirus. The Commission found that the Czech scheme is in line with the conditions set out in the Temporary Framework. In particular, (i) the support per company will not exceed €800,000 as provided for in the Temporary Framework; and (ii) the scheme will run until 30 June 2021. The Commission concluded that the scheme 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 of 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.59118 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.