State aid: Commission approves €50 million Hungarian ‘umbrella’ scheme to support companies affected by the coronavirus outbreak

The European Commission has approved a €50 million (approximately HUF 18 billion) Hungarian ‘umbrella’ scheme to support companies in the context of the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework. The scheme consists of two measures: (i) support in the form of direct grants; and (ii) support for uncovered fixed costs to companies that suffered a decline in turnover during the eligible period (i.e. all or part of the period between 1 March 2020 to 31 December 2021) of at least 30%, compared to the same period in 2019. The scheme is open to companies of all sizes active in all sectors except for the financial sector and covers the entire territory of Hungary. The aim of the scheme is to help the beneficiaries to address their liquidity needs and continue their activity during and after the outbreak. The Commission found that the Hungarian scheme is in line with the conditions set out in the Temporary Framework. In particular, with respect to the first measure, the aid will not exceed €225,000 per company active in the primary production sector of agricultural products, €270,000 per company active in the fisheries and aquaculture sector and €1.8 million per company active in all other sectors. With respect to the second measure, (i) the aid will not exceed €10 million per company; and (ii) the aid intensity will not exceed 90% of the uncovered fixed costs of micro and small companies, or 70% of all other companies. Aid under both measures will be granted no later than 31 December 2021. The Commission concluded that the measures are 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 scheme 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.62363 in the State aid register on the Commission’s competition website.