State aid: Commission approves €58 million Latvian rent compensation scheme to support companies affected by coronavirus outbreak
The European Commission approved a €58 million Latvian scheme to support companies leasing property from public bodies that saw their income substantially decrease due to the measures imposed by the Latvian government in the context of the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework. The support, which will take the form of direct grants, is intended to reduce lessees’ lease payments for publicly owned property. Additionally, lessees are released from the imposition of late interest and contractual penalties in the case of a late payment, except for the payment for services consumed. The purpose of the scheme is to mitigate the sudden liquidity shortages that the affected companies are facing because they had to close their business or reduce their activity due to the measures taken by the Latvian authorities to limit the spread of the coronavirus. The Commission found that the Latvian scheme is in line with the conditions set out in the Temporary Framework. In particular, (i) the support per company will not exceed the limits as set out in the Temporary Framework and (ii) the scheme will run until 31 December 2020. 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 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.57740 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.
