EUR 625 million Italian scheme for operators & agencies affected by COVID-199 authorised by the EU C

Together, operators and travel agencies in Italy affected by the coronavirus outbreak will receive financial assistance to get out of the current economic crisis, as the EUR 625 million Italian scheme has been accepted by the European Union Commission under the Temporary State aid system.

In this regard, Executive Vice-President Margrethe Vestager stressed that the economic effects of the Coronavirus have hit the tourism sector in Italy hard, reports SchengenVisaInfo.com.

This EUR 625 million Italian measure would allow companies operating in the tourism sector to tackle their liquidity problems. "We will continue to work with Member States to ensure that national support measures, in line with EU rules, can be put in place in a coordinated and effective way," Vestager said.

State help The temporary structure scheme consists of grants equivalent to a proportion (between 5% and 20%) of the difference between:

• Amounts of turnover and costs were reported between 23 February 2020 and 31 July 2020.

• For the corresponding duration of 2019, the sum of turnover and expenditures.

The goal of such a move is to help Italy recover from the financial crisis caused by the spread of the pandemic of Coronavirus.

The European Commission concluded that the scheme notified by Italy fulfills the requirements laid down in the Temporary Arrangement, that the assistance per business will not exceed EUR 800 000 and that it will be allocated by 30 June 2021.

The Commission concluded that the Italian measure would lead to the management in Italy of the economic effect of coronavirus on the tourism sector.' In accordance with Article 107(3)(b) TFEU, it is required, acceptable and proportionate to remedy a serious disruption in the economy of a Member State,' reads a statement from the EU Commission.

The Temporary Arrangement allows Member States of the European Union to sustain the economy under state aid rules in the midst of the COVID-19 outbreak.

There are many forms of assistance offered by the Temporary System, which can be granted by the Member States. As amended on 3 April, 8 May, 29 June and 13 October 2020, the system contains the following forms of aid:

• Equity injections, loans, advance payments of more than EUR 100 000 for a company operating in the primary agricultural sector, more than EUR 120 000 for a company operating in the fisheries and aquaculture sector, and more than EUR 800 000 for a company operating in other sectors to meet its urgent liquidity needs.

• State guarantees for loans taken from corporations to ensure that banks continue to offer loans to the consumer who needs them.

• Subsidized public loans to companies at fair interest rates.

• Public short-term export credit insurance coverage for all foreign nations, without the need for the Member State in question to demonstrate that 'non-marketable' is the country in question.

Through this system, Member States are able to integrate all assistance initiatives 'with the exception of loans and guarantees for the same loa n' and meet the thresholds foreseen by the Temporary Framework.

In September, in its report, the World Travel & Tourism Council (WTTC) stressed that Italy is at risk of losing EUR 36.7 billion this year due to coronavirus disease.

On the basis of the WTTC study, a steady decline in the number of foreign visitors and travellers could lead to an 82 percent decrease in Italy's global spending over the course of this year. Italy's economy may have a deficit of EUR 700 million a week or, on average, EUR 100 million a day.