COVID-19: European Commission gives green light for three Belgian schemes involving social security contribution reductions for the travel, hotel and events sectors

On 4 June 2021, the European Commission approved three Belgian aid schemes for the travel, hotel and events sectors, which have been severely affected by the health crisis and the resulting national measures.

The measures notified by Belgium are based on the European Commission's Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak. This Framework allows States to grant reductions in social contributions for the undertakings most affected by the pandemic. The measures aim to preserve the jobs of employees who would otherwise have been made redundant and also to allow undertakings to resume their activities immediately after the lockdown period.

With respective budgets of EUR 28,541,400 for the tourism sector, EUR 7,700,000 for the hotel sector and EUR 22,640,000 for the events sector, the aid schemes are open to all undertakings active in these sectors, in the whole Belgian territory.

To be eligible for the aid schemes, relevant undertakings:

• must not (i) distribute dividends to shareholders, (ii) distribute bonuses to the Administration Board or to management staff and (iii) repurchase their own shares; and
• must inform and consult their company’s social consultation bodies about this support measure, especially with regard to the training offer detailed below.

Aid will only be granted after eligible employers submit their quarterly social contribution statements, which are due in July 2021.

The administration of the measure will be carried out by the National Social Security Office (NSSO).

Measure in favour of the tourism sector

The aid will take the form of a reduction in social contributions due in the first and second quarters of 2021, intended to constitute a wage subsidy, thus contributing to the wage cost borne by employers.

To be eligible, employers must:

• guarantee to keep in service all employees who have been employed continuously between 1 April 2021 and 30 June 2021 (except in the event of resignation or dismissal on serious grounds); and
• provide training to all its staff to prepare them for developments in the sector and in the labour market, devoting at least 20% of their working time in the first and second quarters of 2021 (possibly beyond if necessary).

The aid scheme also provides for a reduction for all staff, equivalent to the total basic social contributions due in the second quarter of 2021. This reduction only applies to employers in the sector who fall within the scope of the law of 21 November 2017 on the sale of package travel, linked travel services and travel services.

Measure in favour of the hotel sector

The scheme will take the form of a total exemption from (employers’) social security contributions for the second quarter of 2021, for up to five employees.

The aid is limited to employers in the hotel sector whose turnover decreased by at least 60% in the second quarter of 2021 compared with the second quarter of 2019.

To be eligible, employers must, in addition to the two conditions set out above:

• keep in service all employees for whom the reduction has been asked during the quarter covered by the measure (except in the event of resignation or dismissal on serious grounds); and
• offer all full-time workers five days of training in 2021 to prepare them for developments in the sector and in the labour market, adjusted on a pro rata basis for part-time workers.

Measure in favour of the events sector

The aid measure for this sector will be granted in the form of a total exemption from (employers’) social security contributions for the second and third quarters of 2021, for up to five employees.

To be eligible, employers must, in addition to the two conditions set out above:

• keep in service all employees for whom the reduction has been asked during the quarters covered by the measure (except in the event of resignation or dismissal on serious grounds);
• offer all full-time workers five days of training in 2021 to prepare them for developments in the sector and in the labour market, adjusted on a pro rata basis for part-time workers; and
• guarantee that the total number of temporary unemployment days for the quarters covered by the measure is below the number of temporary unemployment days in the first quarter of 2021.

The European Commission has examined these three schemes in the light of the Temporary Framework and considers that the planned aid measures are necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State, in accordance with Article 107.3 b) of the TFEU, as they meet all the conditions set out in the Temporary Framework.

These measures complete the aid package implemented in Belgium to support undertakings impacted by the COVID-19 crisis.

For more information on the measures put in place by Member States to support your undertaking, please refer to the Guide published by CMS concerning the public support measures implemented in 21 European countries in the context of the COVID-19 crisis.