The European Commission has approved two Bulgarian wage subsidies support schemes for preserving employment in the sectors most affected by the coronavirus outbreak. The schemes were approved under the state aid Temporary Framework.The first scheme is a prolongation and modification of the wage subsidy scheme approved by the Commission on 14 April 2020, known in Bulgaria as the “60/40” aid scheme. The main changes to the existing scheme concern the extension of the measure to three additional sectors (other education, dental practice and other human health services) and three additional categories of eligible employees, as well as its prolongation until the end of the year 2020.
The modified scheme will be funded within the initially approved budget of BGN 1.5 billion (approximately €770 million). The second scheme, with an estimated budget of BGN 40m (approximately €20.5m), will provide aid in the form of direct grants of BGN 290 (approximately €148) per beneficiary per month and is open to companies of all sizes and self-employed persons active in the sectors most affected by the coronavirus outbreak (transport, hotels, restaurants and travel agencies). The scheme will be co-financed by the European Social Fund and will last maximum until the end of the year 2020. Both measures aim at avoiding layoffs and ensuring the continuation of business activities during the coronavirus outbreak.
The Commission found that the two schemes are in line with the conditions set out in the Temporary Framework. In particular, (i) the aid will be granted for a period of no longer than twelve months, for employees that would otherwise have been laid off and for self-employed persons whose business activity has been negatively affected by the coronavirus outbreak; (ii) the aid is conditional on the benefiting personnel being maintained in continuous employment for the entire subsidy period, and on benefiting self-employed persons maintaining their business activity for the same period; (iii) in case of cumulation of aid under both measures, the aid will comply with the maximum intensity of 80% allowed by the Temporary Framework; and (iv) in case of cumulation with other employment support measures, overcompensation of the wage costs will be excluded.
The Commission concluded that the measures are necessary, appropriate and proportionate to fight the current economic crisis, 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. 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 numbers SA.57646 and SA.57759 in the state aid register on the Commission’s competition website once any confidentiality issues have been resolved.