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Urmas REINSALU Välisminister Islandi Väljak 1 15049 Tallinn Estonia EUROPEAN COMMISSION Brussels, 17.2.2021 C(2021) 1188 final PUBLIC VERSION This document is made available for information purposes only. Subject: State Aid SA.61615 (2021/N) – Estonia Subsidy schemes to undertakings in Ida-Viru and Harju Counties affected by the COVID-19 Excellency, 1. PROCEDURE (1) By electronic notification of 29 January 2021, Estonia notified aid in the form of direct grants ‘Subsidy schemes to undertakings in Ida-Viru and Harju Counties affected by the COVID-19’ (“the measure”), under the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak, as amended (“the Temporary Framework”).1 Estonia also provided additional information on 13, 15 and 17 February 2021. (2) The Estonian authorities exceptionally agree to waive their rights deriving from Article 342 of the Treaty on the Functioning of the European Union (“TFEU”), in conjunction with Article 3 of Regulation 1/19582 and to have this Decision adopted and notified in English. 1 Communication from the Commission - Temporary framework for State aid measures to support the economy in the current COVID-19 outbreak, OJ C 91I, 20.3.2020, p. 1, as amended by Commis s ion Communications C(2020) 2215 (OJ C 112I, 4.4.2020, p. 1), C(2020) 3156 (OJ C 164, 13.5.2020, p. 3), C(2020) 4509 (OJ C 218, 2.7.2020, p. 3), C(2020) 7127 (OJ C 340I, 13.10.2020, p. 1) and C(2021) 564 (OJ C 34, 1.2.2021, p. 6). 2 Regulation No 1 determining the languages to be used by the European Economic Community, OJ 17, 6.10.1958, p. 385. Urmas REINSALU Välisminister Islandi väljak 1 15049 Tallinn Estonia Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË - Tel. +32 22991111 2. DESCRIPTION OF THE MEASURE (3) Estonia considers it necessary to introduce a measure under the Temporary Framework in order to provide support to undertakings that found themselves in a difficult situation due to the new COVID-19 safety rules or bearing costs related to sanitary restrictions. (4) The Estonian authorities confirm that the aid under the measure is not conditioned on the relocation of a production activity or of another activity of the beneficiary from another country within the EEA to the territory of the Member State granting the aid. This is irrespective of the number of job losses actually occurred in the initial establishment of the beneficiary in the EEA. (5) The compatibility assessment of the measure is based on Article 107(3)(b) TFEU, as interpreted by Sections 2 and 3.1 of the Temporary Framework. 2.1. The nature and form of aid (6) The measure provides aid in the form of direct grants. It includes two sub- measures (see section 2.7 below). 2.2. Legal basis (7) The legal basis for the first sub-measure3 is the Estonian Government Regulation No 87 of 19 November 2020 “Employment programme 2021-2023”.4 The legal basis for the second sub-measure5 is the Estonian Government Order No 458 of 23 December 2020 and Directive of the Minister of Finance No 236 of 31 December 2020. Those legal bases will be amended to prolong the duration of the measure until 31 December 2021. 2.3. Administration of the measure (8) The aid granting authority for sub-measure 1 is the Estonian Unemployment Insurance Fund. The aid granting authority for sub-measure 2 is the Ministry of Finance. 2.4. Budget and duration of the measure (9) The estimated national budget of the measure amounts to EUR 26.3 million, subdivided into EUR 24.2 million for sub-measure 1 and EUR 2.1 million for sub-measure 2. The credit and financial institutions are excluded from the scope of the notified measure. 3 Remuneration allowance in connection with COVID-19 disease prevention restrictions to undertakings in Ida-Viru and Harju Counties. 4 Government Regulation of 19.11.2020 No 87, amended by Government Regulation of 30.12.2020 No 103, Government Regulation of 15.01.2021 No 2 and Government Regulation of 28.01.2021 No 5. 5 Conditions of support for partial compensation for the damage caused by the outbreak of COVID -19 to undertakings in Ida-Viru County. 2 (10) The Estonian authorities confirm that aid may be granted under the measure as from the notification of the Commission’s decision not to raise objections until no later than 31 December 2021. 2.5. Beneficiaries (11) The measure applies to undertakings irrespective of their size, which had to suspend or limit their activities due to the restrictions imposed by the Estonian Government. Sub-measure 1 will apply to approximately 3000 beneficiaries. Sub- measure 2 will apply to approximately 200 beneficiaries. (12) Aid may not be granted under the measure to medium6 and large enterprises that were already in difficulty on 31 December 2019 within the meaning of the GBER7. (13) Aid may be granted to micro and small enterprises8 that were already in difficulty on 31 December 2019, provided that these enterprises, at the moment of granting of the aid, are not subject to collective insolvency procedure under national law and that they have not received rescue aid9 or restructuring aid.10 2.6. Sectoral and regional scope of the measure (14) Sub-measure 1 applies to Ida-Viru and Harju Counties. It is open to enterprises whose principal activity falls into the following sectors: accommodation and food service activities, information and communication, administrative and support service activities, education, human health and social work activities, arts, entertainment and recreation, and other service activities.11 (15) Sub-measure 2 applies to Ida-Viru County. It is open to enterprises whose principal activity falls into the following sectors: accommodation and food service activities, health care and social work and other services.12 (16) The credit and financial institutions as well as the agricultural, fisheries or aquaculture sectors are excluded from the scope of the notified measure. In 6 As defined in Annex I to Commission Regulation (EU) No 651/2014 of 17 June 2014 declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty, OJ L 187, 26.6.2014, p. 1 (“GBER”). 7 As defined in Article 2(18) of the GBER. 8 As defined in Annex I to Commission Regulation (EU) No 651/2014 of 17 June 2014. 9 Alternatively, if they have received rescue aid, they have reimbursed the loan or terminated the guarantee at the moment of granting of the aid under the notified measure. 10 Alternatively, if they have received restructuring aid, they are no longer subject to a restructuring plan at the moment of granting of the aid under the notified measure. 11 These sectors are more specifically defined in the legal basis by reference to the national equivalent of NACE codes. 12 These sectors are more specifically defined in the legal basis by reference to the national equivalent of NACE codes. 3 addition, the Estonian authorities confirmed that the beneficiaries are not undertakings active in the processing and marketing of agricultural products. 2.7. Basic elements of the measure (17) Sub-measure 1 covers undertakings whose main activity falls in the sectors mentioned above (recital (14)) in the Ida-Viru and Harju Counties that had to suspend their activities from 28 December 2020 until 31 January 2021 due to the restrictions imposed by the Estonian Government.13 The beneficiaries are companies, foundations, non-profit associations and self-employed persons. Entrepreneurs receive support for those employees whose place of employment is in the Ida-Viru or Harju Counties as of 22 December 2020. The amount of the financial support is calculated on the basis of 1.5 times the wage costs of the employees for November 2020.14 The amount of support for a sole proprietor with a registered seat in Ida-Viru or Harju Counties shall be 1.5 times the minimum monthly wage payable in 2020. The maximum amount of support per company is EUR 180 000. Applications shall be submitted until 28 February 2021. (18) Sub-measure 2 covers companies, non-profit associations, and self-employed persons active in the sectors listed above (recital (15)) in the Ida-Viru County that had to suspend or limit their activities from 12 December 2020 until 3 January 2021 due to the restrictions imposed by the Estonian Government.15 The list of potential beneficiaries was prepared by the Estonian Tax and Customs Board based on the tax declarations submitted by the taxpayers with respect to the salary payments made in November 2020 and the relevant code of Estonian Classification of Economic Activities16 that the beneficiaries have declared in their annual reports to the Commercial Register. Entrepreneurs receive support for those employees whose place of employment is in the Ida-Viru County as of 15 December 2020. The amount of the support is calculated on the basis of the double wage cost of the company for November 2020. The maximum amount of support per company is EUR 180 000. (19) To the extent they are eligible, beneficiaries can cumulate aid under both sub- measures. Aid may be granted provided that the total nominal value, including other aid granted in accordance with section 3.1 of the Temporary Framework, does not exceed EUR 1.8 million (all figures used being expressed in gross). 13 Government of the Republic Order No 462 of 23 December 2020 “Amendment of the Government of the Republic Order No 282 of 19 August 2020 “Measures and restrictions necessary for preventing the spread of COVID-19”” and Government of the Republic Order No 16 of 15.01.2021 “Amendment of the Government of the Republic Order No 282 of 19 August 2020 “Measures and restrictions necessary for preventing the spread of COVID-19””.
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