EUROPEAN COMMISSION Brussels, 22.07.2015 C(2015) 5002 final PUBLIC VERSION This document is made available for information purposes only. Subject: State Aid SA.41372 Austria Restructuring aid scheme "TOP-Tourismus-Förderung, Teil D" Sir, /Madam, 1. PROCEDURE (1) On 26 March 2015 Austria notified a restructuring aid scheme for SMEs in the tourism and leisure sector (TOP-Tourismus-Impuls 2014-2020, Teil D: TOP- Restrukturierung) (hereinafter "the scheme"). (2) By letter dated 11 May 2015 the Commission requested additional information on the notified scheme, which the Austrian authorities submitted by letter dated 3 June 2015. 2. DESCRIPTION OF THE SCHEME 2.1. Objective (3) The objective of the scheme is the restructuring of SMEs in difficulties active in the hotel and gastronomy sectors. (4) The aid is granted by the Federal Minister of Science, Research and Economy on the basis of an assessment of each application carried out by the Austrian Bank for hotel and tourism (Österreichische Hotel- und Tourismusbank, "ÖHT") in accordance with the notified scheme. Herrn Sebastian KURZ Bundesminister für europäische und internationale Angelegenheiten Minoritenplatz 8 1014 Wien ÖSTERREICH Commission européenne, B-1049 Bruxelles Belgique Europese Commissie, B-1049 Brussel België Telefon: 00 32 (0) 2 299.11.11
2.2. Beneficiaries (5) Under the scheme SMEs in difficulties active in the tourism and leisure sector are eligible for aid. SMEs are defined as in the latest applicable version of the Commission recommendation concerning the definition of SMEs. 1 (6) Pursuant to the scheme an undertaking is considered to be in difficulties if at least one of the following circumstances occurs: (a) (b) (c) In the case of a limited liability company: more than half of its subscribed share capital has disappeared as a result of accumulated losses; In the case of a company where at least some members have unlimited liability for the debt of the company (Personengesellschaft): more than half of its capital as shown in the company accounts has disappeared as a result of accumulated losses; The undertaking fulfils the criteria under Austrian law for being placed in collective insolvency proceedings. In accordance with national law an indicator for the fulfilment of this criterion is that the fictitious debt repayment period of the undertaking in question exceeds 15 years and that its equity ratio is below 8%. (7) The scheme provides that in any event the undertaking must not be in difficulties only or mainly due to the fault of its owner or manager (Geschäftsführer). (8) Newly created undertakings during the first three years following the start of operations are not eligible for aid under the scheme. (9) Aid to companies belonging to or being taken over by a larger business group can only be granted under the conditions laid down in point 22 of the Guidelines on State aid for recuing and restructuring non-financial undertakings in difficulty 2 (hereinafter: "the Guidelines"). (10) The scheme, further, excludes the payment of individual aid on its basis to undertakings which are subject to an outstanding recovery order following a previous Commission decision declaring an aid illegal and incompatible with the internal market. 2.3. Conditions for granting of aid (11) Pursuant to the scheme the aid can only be granted if it contributes to a welldefined objective of common interest, if the need for a State intervention is shown, if the aid measure is appropriate, if the aid has an incentive effect, if the aid is proportionate and if any undue negative effects on competition and trade between Member States are avoided. In addition, for aid granted after of 1 July 2016, all conditions laid down in point 96 of the Guidelines as to the transparency of the aid must be fulfilled. 1 At the time of drafting of the scheme the latest applicable version was Commission recommendation of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises (2003/361/EC), OJ L 124 of 20.05.2003, p. 36. 2 OJ C 249 of 31.7.2014, p. 1. 2
2.3.1. Objective of common interest (12) Before granting any aid the ÖHT must establish that the failure of the beneficiary would likely involve social hardship or a market failure in line with the criteria established in point 107 of the Guidelines. (13) Furthermore, aid under the scheme is conditional upon the implementation of a detailed and feasible restructuring plan. The scheme expressly provides that the ÖHT must establish that the restructuring plan fulfils the conditions laid down in chapter 3.1.2 of the Guidelines. 2.3.2. Need for State intervention and incentive effect (14) The ÖHT must establish a need for State intervention in accordance with point 53 of the Guidelines and to this end must carry out a comparison with a credible alternative scenario not involving State aid. In addition, it needs to verify that the aid has an incentive effect by demonstrating that in the absence of the aid the beneficiary would have been restructured, sold or wound up in a way that would not have achieved the objective of common interest. 2.3.3. Appropriateness (15) Aid under the scheme can be granted in form of: (a) (b) (c) The drawing up of a restructuring plan for the beneficiary by the ÖHT or coaching by the ÖHT or a consultant chosen by the ÖHT; A guarantee under the separately notified scheme "Richtlinie des Bundesministers für Wissenschaft, Forschung und Wirtschaft für die Übernahme von Haftungen für die Tourismus- und Freizeitwirtschaft 2014-2020"; 3 Financial support in the form of an interest subsidy of 2% p.a. for a maximum duration of 10 years; the basis for applying the interest subsidy is a maximum of 40% of a total debt of maximum EUR 2 million. (16) The scheme provides that the form of restructuring aid chosen must be appropriate to the issue that it intends to address. 2.3.4. Proportionality of the aid (17) The scheme provides that the amount and intensity of any restructuring aid must be limited to the strict minimum necessary to enable the restructuring to be undertaken, taking into account the existing financial resources of the beneficiary as well as a contribution to the restructuring by the creditors which must be as high as possible. (18) The scheme clarifies that a significant level of own contribution by the beneficiary and its creditors is required. The own contribution can be considered adequate if it amounts to at least 40% of the restructuring costs in case of 3 Aid in the form of guarantees for restructuring of SMEs in difficulties was notified separately under SA.41373 (2015/N) but needs to fulfil all conditions laid down in the present scheme and is, therefore, also in the present scheme listed as one of the forms in which aid can be granted. 3
medium-sized enterprises or at least 25% of the restructuring costs in case of small enterprises. The own contribution must be aid-free. (19) In addition, the scheme provides that the own contribution should be comparable to the aid granted in terms of effects on the solvency or liquidity position of the beneficiary. 2.3.5. Avoidance of undue negative effects on competition and intra-eu trade 2.3.5.1. One time, last time principle (20) The scheme provides that the "one time, last time" principle must be respected. In particular, it is stipulated that it is assessed whether the undertaking has already received rescue aid, restructuring aid or temporary restructuring support in the past, including any non-notified aid. If less than ten years have elapsed since rescue aid or temporary restructuring support was granted, the restructuring period came to an end or implementation of the restructuring plan was halted (whichever occurred the latest), no further aid may be granted on the basis of the scheme. An exemption from this rule can only be made in exceptional and unforeseeable circumstances for which the beneficiary is not responsible. 2.3.5.2. Measures to limit distortions of competition (21) The scheme provides that, in case of restructuring aid granted to medium sized undertakings, measures to limit distortions of competition have to be taken. These measures must be in proportion to the possible distortions of competition and to the size of the beneficiary. (22) Under the scheme, aid beneficiaries must not increase their capacity during the restructuring period. An exception is only possible for small undertakings if necessary for ensuring the firm's long-term survival. 2.3.5.3. Recipients of previous unlawful aid (23) As stated above, the scheme excludes the payment of individual aid on its basis to undertakings which are subject to an outstanding recovery order following a previous Commission decision declaring an aid illegal and incompatible with the internal market. 2.3.6. Transparency (24) As to the transparency of aid, the scheme provides that, for aid granted after of 1 July 2016, all conditions laid down in point 96 of the Guidelines will be fulfilled. 2.4. Budget and duration of the scheme (25) The scheme states that it enters into force on 1 July 2014 and that it will expire on 31 December 2020. However, the scheme provides that no aid will be granted until a decision by the Commission declaring the scheme to be compatible with the internal market is taken. (26) The scheme foresees a yearly budget of EUR 1.35 million. 4
3. ASSESSMENT 3.1. Existence of State aid (27) Article 107(1) TFEU provides that any aid granted by a Member State or through State resources in any form whatsoever which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods shall, in so far as it affects trade between Member States, be incompatible with the internal market. (28) At the outset the Commission observes that Austria notified the scheme as aid scheme and does not question the qualification of measures taken on its basis as State aid. (29) The measures under the scheme are granted by the Federal Minister of Science, Research and Economy on the basis of an assessment of each application carried out by the ÖHT. Thus, the aid is granted through State resources and the decision to grant aid is imputable to the State. (30) The terms of the public support granted on the basis of the scheme are terms that the beneficiaries, which are undertakings in difficulty, could not obtain on the market. As such, they give a selective advantage to the beneficiaries. The public support granted in this manner, furthermore, strengthens the position of the beneficiaries compared to that of their competitors in Austria and in other Member States and must, therefore, be regarded as distorting competition and affecting trade between Member States. (31) The measures taken on the basis of the scheme, thus, constitute State aid within the meaning of Article 107(1) TFEU. 3.2. Lawfulness of the measure (32) While the regulatory measure setting up the scheme entered into force on 1 July 2014, it provides that no individual aid will be granted until a positive decision is taken by the Commission. The scheme will expire on 31 December 2020 as the applicability of the Commission Guidelines. (33) Thus, Article 108(3) TFEU has been observed. 3.3. Compatibility of the aid with the internal market (34) Under the notified scheme it is foreseen to grant restructuring aid to SMEs in difficulties. In view of this, the Commission has examined the scheme in light of Article 107(3) (c) TFEU and, in particular, on the basis of the Guidelines, which foresee, in their point 37, that the Commission may authorise schemes for smaller amounts of aid to SMEs and smaller State-owned undertakings if the conditions set out in Chapter 6 of the Guidelines are met. 3.3.1. Beneficiaries (35) As only SMEs in difficulties active in the tourism and leisure sector are eligible for the aid under the scheme (see section 2.2 above) the Commission considers that the scheme observes points 37, 18 of the Guidelines. 5
(36) In accordance with point 19 of the Guidelines the scheme provides that the aid can only be granted to undertakings in difficulties as defined in point 20 a) - c) of the Guidelines (see point 6 above). (37) The scheme excludes aid to newly created undertakings as defined in point 21 of the Guidelines. Aid to companies belonging to or being taken over by a larger business group can only be granted under the conditions laid down in point 22 of the Guidelines. 3.3.2. Aid instruments (38) The scheme foresees the granting of restructuring aid as described in point 27 of the Guidelines. 3.3.3. Conditions for granting of aid (39) In line with point 105 of the Guidelines the scheme ensures that the maximum amount of aid that can be awarded to any one undertaking does not exceed EUR 10 million. (40) As foreseen in point 38 of the Guidelines, aid can only be granted if it contributes to a well-defined objective of common interest, if the need for a State intervention is shown, if the aid measure is appropriate, if the aid has an incentive effect, if the aid is proportionate and if any undue negative effects on competition and trade between Member States are avoided. In addition, for aid granted after of 1 July 2016, all conditions laid down in point 96 of the Guidelines as to the transparency of the aid must be fulfilled. (41) The scheme requires that, in order to prove that the aid contributes to a welldefined objective of common interest, the ÖHT has to establish that the failure of the beneficiary would likely involve social hardship or market failure as defined in point 107 of the Guidelines. In addition, the granting of the aid is conditional upon the implementation of a detailed and feasible restructuring plan to restore the beneficiary's long-term viability. (42) Under the scheme the ÖHT must establish the need for State intervention and that the aid has an incentive effect as required in point 53 and 59. (43) The appropriateness of any restructuring aid must be established in line with point 58 of the Guidelines. (44) Restructuring aid under the scheme is regarded to be proportionate only if, in line with point 61 of the Guidelines, its amount and intensity is limited to the strict minimum necessary to enable the restructuring to be undertaken and, furthermore, only if the conditions of a significant own contribution of points 62-63 and 111 of the Guidelines are fulfilled. (45) The scheme stipulates that the "one time, last time" principle must be respected. In addition, it stipulates that measures to limit distortions of competition in line with points 77-93 as well as 113 of the Guidelines must be taken. (46) Furthermore, the scheme expressly excludes the payment of individual aid in favour of an undertaking which is subject to an outstanding recovery order 6
following a previous Commission decision declaring an aid illegal and incompatible with the internal market. Conclusion (47) In view of the above, the Commission concludes that the scheme fulfils all compatibility criteria laid down in the Guidelines and is, therefore, compatible with the internal market. 4. CONCLUSION The Commission has accordingly decided: not to raise objections to the notified scheme on the grounds that it is compatible with the internal market pursuant to Article 107(3)(c) of the Treaty on the Functioning of the European Union. If this letter contains confidential information which should not be disclosed to third parties, please inform the Commission within fifteen working days of the date of receipt. If the Commission does not receive a reasoned request by that deadline, you will be deemed to agree to the disclosure to third parties and to the publication of the full text of the letter in the authentic language on the Internet site: http://ec.europa.eu/competition/elojade/isef/index.cfm. Your request should be sent electronically to the following address: European Commission, Directorate-General Competition State Aid Greffe B-1049 Brussels Stateaidgreffe@ec.europa.eu Yours faithfully For the Commission Margrethe VESTAGER Member of the Commission 7