ANNOUNCEMENT 29 Jun 2021

In June 2021, the European Commission approved a financial grant scheme to finance uncovered fixed costs of agricultural and horticultural enterprises in the context of the COVID-19 pandemic. 

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

European Commission, Letter to the Member State on 29 Juni 2021, State Aid SA.63576 (2021/N) – Netherlands, NL_LNV_AGRO_EIA Aid scheme financing uncovered fixed costs agricultural and horticultural undertakings COVID-19:
https://ec.europa.eu/competition/state_aid/cases1/202127/295098_2293842_45_2.pdf

European Commission, SA.63576 NL_LNV_AGRO_EIA Aid scheme financing uncovered fixed costs agricultural and horticultural undertakings COVID-19: https://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_63576

SA.100202 NL_LNV_AGRO_EIA_Modification to SA.63576 (2021/N) - NL LNV AGRO EIA Aid scheme financing uncovered fixed costs agricultural and horticultural undertakings COVID-19
https://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_100202

Inception date: 29 Jun 2021 | Removal date: 15 Oct 2021

Financial grant

On 29 June 2021, the European Commission approved a Dutch financial grants scheme for agricultural and horticultural enterprises affected by the COVID-19 pandemic. The Netherlands has indicated an estimated budget of EUR 20 million (approx. USD 23.8 million), and the aid will be granted for uncovered fixed costs for the period from 1 June 2021 to 30 June 2021. The aid will be granted latest until 31 December 2021. 

The approved financial aid scheme provides direct grants to SMEs and large companies active in the primary agricultural and horticultural sector that have suffered a loss in turnover of at least 30% compared to 2019. The agricultural enterprises will receive up to 70% of their uncovered fixed costs, with the maximum amount of aid capped at EUR 550,000 (approx. USD 650,000) for SMEs and EUR 600,000 (approx. USD 714,000) for large enterprises per quarter. The Netherlands Enterprise Agency (RVO in Dutch) is the administering authority and has issued a list of eligible agricultural and horticultural activities. The Netherlands expect 200 beneficiaries within this scheme. However, the financial support from this scheme is reduced by the amount of liquidity support for fixed costs from a second aid scheme, see the related State Acts. 

The aid aims to support enterprises that were suffering a decline in turnover while high fixed costs continued. In addition, the scheme should maintain the enterprises' liquidity during the restriction and suspension of their business activities due to the COVID-19 pandemic. 

In its decision, the European Commission confirmed that the scheme "strengthens the competitive position of its beneficiaries" and it "also affects trade between Member States, since those beneficiaries are active in sectors in which intra-Union trade exists".  

The state aid is approved under the Temporary Framework under the State Aid and its amendments of 2 April 2020, 13 October 2020 and 1 February 2021. The European Commission adopted the Temporary Framework under the State Aid rules of the European Union on 19 March 2020 (see the related State Act). The European Commission approved the state aid without raising objections, concluding that the measure is compatible with the internal market according to Article 107(3)(b) of the TFEU.

A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.

Update

On 15 October 2021, the European Commission approved a significant budget increase of the present scheme (see related state act).

 

AFFECTED PRODUCTS

 
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