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State aid: EU Commission approves €50 million Lithuanian measures in support of companies operating in the travel sector affected by the coronavirus outbreak

The European Commission approved two Lithuanian measures, with an estimated total budget of €50 million, to support travel agencies, tour operators, accommodation and catering businesses which were affected by the measures adopted by the Lithuanian authorities to face the coronavirus health emergency.

The measures were approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020 and 8 May 2020. The public support will take the form of (i) individual guarantees to ensure that tour operators can respect their contractual obligations, in particular in case of insolvency or bankruptcy; and (ii) loans to tour operators, accommodation and public catering service providers.

The first measure will provide guarantees to tour operators established in Lithuania, with a maximum amount not exceeding €800,000 per beneficiary. The second measure will provide loans to tour operators to finance the reimbursement of travellers for trips that did not occur as a result of coronavirus-related travel restrictions, as well as to accommodation and catering service providers for the costs incurred as a result of the same restrictions.

The purpose of the measures is to facilitate access to finance and to mitigate the sudden liquidity shortages that the affected companies are facing. The Commission found that the Lithuanian measures are in line with the conditions set out in the Temporary Framework. In particular, with regard to the first measure, the support per company will not exceed the €800,000. With regard to the second measure, the loan contracts are limited to a maximum of 6 years.

Furthermore, aid under both measures will be granted no later than 31 December 2020. The Commission concluded that the 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 measure under EU State aid rules.More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here.

The non-confidential version of the decision will be made available under the case number SA.57665 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.

https://ec.europa.eu/competition/index_en.html

https://ec.europa.eu/competition/state_aid/register/

Arianna Podesta – Giulia Astuti –