State aid: Commission approves €868 million Italian scheme to reduce labour costs borne by private employers in certain sectors particularly affected by coronavirus outbreak

The European Commission has approved a €868 million Italian scheme to reduce the labour costs borne by private employers operating in the tourism, spas, commerce, cultural or recreational sectors, which have been particularly affected by the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework. The aid aims at preserving employment levels and will consist of an exemption from the payment of employers’ social security contributions due for the period from 25 May 2021 to 31 December 2021. The maximum amount of aid that can be granted is up to twice the employer’s contribution not paid in relation to the hours of use of wage subsidies (‘Cassa Integrazione’) in January, February and March 2021. Eligible beneficiaries will not be able to dismiss employees until 31 December 2021. Any breach of this prohibition would entail the revocation of the aid (with retroactive effect) and the impossibility of applying for the benefit of the pay supplements (so called ‘Cassa Integrazione’). The Commission found that the scheme is in line with the conditions set out in the Temporary Framework. In particular, the aid (i) will not exceed €1.8 million per company and (ii) will be granted no later than 31 December 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.63720 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved