European Commission ratifies expansion of scope of COVID-related measures under TVL scheme

TVL, the Dutch government’s fixed-cost compensation scheme, offers a helping hand to entrepreneurs the COVID pandemic has caused to drop off by 30 percent or more by compensating them at a sector-specific flat-rate percentage of fixed costs. The relevant percentage for Q1 has been raised from its former level of 50 to 70 percent to 85 percent of fixed costs, with the quarterly compensation maximum being increased from 90,000 to 550,000 euros. The workforce maximum of 250 has been abolished with effect from Q1 2021. The maximum quarterly compensation to be doled out to major enterprises has been capped at 600,000 euros each.

Small businesses

The compensation minimum per small business has been increased from 750 to 1,500 euros while the quarterly fixed-cost threshold has been lowered from 3,000 to 1,500 euros.

Extra retail shut-down subsidy

The incremental subsidy for the owners of mandatorily shut down retail businesses has been prolonged to include Q1 2021, at a rate which for the current quarter has been increased from its Q4 2020 level of 5.6 percent to (up to) 21 percent depending on actual sales loss, to an overall maximum of 300,000 euros per applicant. There is no need for retailers to file a separate application for the extra subsidy.

Start-ups

A separate programme (to apply throughout the first half of 2021) based on the existing TVL scheme is being finalised – for roll-out in April or May of this year, it is still hoped – for those who launched their own business some time during the first half of 2020. The third quarter of 2020 has been selected as the reference period to be used by the relevant start-ups. As those having launched a business of their own in the 2.5 month interval between the first of January and the 15th of March of the current year would also have the option of applying for “regular” TVL subsidy, in order to avoid overlap the Cabinet is considering issuing an additional directive to the effect that participation by such 2021 start-ups is to remain confined to the forthcoming separate programme for start-ups.

Agricultural cum horticultural sector to be allowed standard generic subsidy limit

Medium-sized businesses forming part of the agricultural cum horticultural sector are not currently eligible for the higher fixed cost compensation maximum owing to the fact that the TVL application was made under the EU support framework. Work is under way aimed at anchoring the scheme in an alternative government support framework similar to the expanded TVL scheme. It is the Cabinet’s intention retroactively from Q1 2021 onwards to launch the revised scheme in April or May of this year.

Special scheme for costs incurred by agricultural and horticultural businesses

As many agricultural and horticultural businesses incur ongoing costs for keeping their crop plants and livestock alive, it has been decided to add a 21 percentage point increment to the TVL subsidy for which agricultural businesses having SBI codes 1.1 to 1.5 inclusive are eligible.

The TVL subsidy for businesses in the agricultural-horticultural industry is currently capped at 225,000 euros each. The Cabinet is working on a separate programme for large-scale businesses in the sector featuring the same maximum amounts as those of the “regular” TVL scheme, viz. 550,000 euros for SMEs and 600,000 euros for their larger industrial peers. The new scheme is scheduled to be launched, with retroactive effect from Q1 2021 onwards, next April or May.

Ratification

The European Commission’s ratification has opened the door to the various TVL amendments being integrated into the existing regime. As soon as this has been done it will be up to RVO.nl, the Netherlands Enterprise Agency, to make supplementary payments where appropriate.

Dutch version: Europese Commissie keurt verruimingen TVL goed