European Commission approves €101.5 million Lithuanian rent compensation scheme to support sectors affected by coronavirus outbreak

The European Commission has approved a Lithuanian €101.5 million rent compensation scheme to support tenants operating in certain sectors, including retail, hotels, restaurants, culture and sports. The scheme was approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “The measures that Member States have had to take to limit the spread of the coronavirus have hit many businesses very hard. This €101.5 million Lithuanian scheme will mitigate the economic effects of the crisis on companies active in many sectors affected by the outbreak, including hotels, restaurants, retail and sports, by covering part of their rental costs.We cooperate closely with Member States to find workable solutions in a coordinated and effective way, in line with EU rules.”

The Lithuanian support measures

Lithuania notified to the Commission under the Temporary Framework a €101.5 million rent compensation scheme to support sectors affected by the coronavirus outbreak.

The scheme will be accessible to companies operating in certain sectors defined by Lithuania, including retail, hotels, restaurants, culture and sports and whose annual turnover in the previous year does not exceed €50 million.

The public support will take the form of direct grants to cover part of the rents due by those companies.

The scheme aims at mitigating the sudden liquidity shortages that tenants operating in certain sectors are facing due to the measures imposed by the Lithuanian State to limit the spread of the coronavirus.

The Commission found that the Lithuanian 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 Lithuanian 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 set out in the Temporary Framework.

On this basis, the Commission approved the measures under EU State aid rules.

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