European Commission approves Danish Covid-19 compensation scheme under State aid rules

European Commission approves Danish Covid-19 compensation scheme under State aid rules

The Commission has found that a EUR 12 million Danish scheme to compensate organisers of large events who have suffered losses as a result of cancellation due to the Covid-19 outbreak is compatible with EU State aid rules.

This decision is noteworthy for a number of reasons.   It represents the first measure notified to the Commission as a result of the outbreak – no doubt many more will follow.  Second, it was approved within 24 hours showing a rapid response by the Commission in a manner not really seen in recent times since the 2008 financial crisis.  Third, the Commission used article 107(2)(b) TFEU which allows Member States to compensate specific companies or sectors for the damage directly caused by exceptional occurrences.  It appears the occurrence cannot be treated as a “natural disaster” under the GBER, making an individual notification necessary.

This raises a question of how many more measures will be notified and when?  Further, with some uncertainty over the precise scope of the UK’s own bespoke State aid regime following Brexit, it may be asked whether the UK’s subsidy control regime will be in a position to move with similar agility faced with unprecedented measures in unprecedented times.

https://ec.europa.eu/commission/presscorner/detail/en/ip_20_454