The European Commission has approved, under EU State aid rules, a German scheme to compensate youth hostels, school country homes, youth education centres and family holiday centres in Bavaria for the loss of revenue caused by the coronavirus outbreak. The public support will take the form of direct grants and will compensate the damage suffered up to a maximum of 60% of the loss of revenues incurred by eligible beneficiaries in the period from 18 March 2020 to 31 July 2020. During this period, the beneficiaries had to close their accommodation facilities due to the restrictive measure that the German authorities implemented to limit the spread of the coronavirus. When calculating the loss of revenue, reductions in costs resulting from income generated during the lockdown (e.g. cancellation fees), as well as possible financial aid granted or actually paid out by public authorities to cope with the consequences of the coronavirus outbreak (including aid granted under the measure with case number SA.56974, approved by the Commission in April 2020) will be deducted. This will ensure that no more than the damage suffered can be compensated. The measure will be funded via the “Corona Programme Social Affairs” fund of the Free State of Bavaria, which has a total budget of €26 million. The Commission assessed the measure under Article 107(2)(b) of the Treaty on the Functioning of the EU, which enables the Commission to approve State aid measures granted by Member States to compensate specific companies or specific sectors for the damages directly caused by restrictive measures taken due to exceptional occurrences, such as the coronavirus outbreak. The Commission found that the German scheme will compensate damages that are directly linked to the coronavirus outbreak. It also found that the measure is proportionate, as the envisaged compensation does not exceed what is necessary to make good the damages. The Commission therefore concluded that the scheme is in line with EU State aid rules. More information on 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.58464 in the State aid register on the Commission’s competition website.
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