Coronavirus: New Flemish Protection Mechanism

Author: Jonas Verplanken (Legal Expert)
Date:

In a previous infoflash, we already explained the Flemish Protection Mechanism, whereby a premium can be requested for companies that have a drop in turnover as a result of the coronavirus measures between 1 August and 30 September.

As Flemish companies are again confronted with a drop in turnover as a result of the stricter federal corona measures, the Flemish Government has now decided to take new aid measures.

For whom?

Concretely, any entrepreneur who suffers a loss of turnover of at least 60% between 1 October and 18 November 2020 as a result of the corona measures can appeal to the new Flemish Protection Mechanism.

Companies may choose to submit an application for the reference period from 1 October to 15 November 2020 or for the period from 19 October to 18 November 2020. The turnover is compared with the turnover, excluding VAT, of the same period in 2019. Cafés and restaurants that are obliged to close down are also eligible for this aid during the period of closure.

Are excluded:

  • Companies in a state of dissolution, cessation of activity, bankruptcy, liquidation;
  • Holdings, management or patrimonial companies;
  • Companies whose managing director is linked as a director, partner or manager to another company that has received the subsidy and to which they provide business services;
  • Companies in arrears with VLAIO following the recovery of corona premiums;
  • Companies that had not yet started up on 1 October 2020.

Conditions

  • The company will have to demonstrate a loss of turnover of 60% within the reference period.
    • Exception: companies in the horeca sector (= hotels, restaurants and cafés) do not have to demonstrate this loss of turnover!
  • Only companies falling within the scope of either the corona nuisance premium or the corona compensation premium are eligible (whether they have applied for it or not)
  • Only companies with an active business conduct during the reference period from 1 October to 18 November 2020 will be eligible for the subsidy, unless the company has been compulsorily closed as a result of the corona measures or the normal annual period of closure.
  • The companies must have started up before 1 October 2020 and have an active place of business in Flanders before 1 October 2020.

Exception for the horeca sector:

Managers of cafés and restaurants[1] which are compulsorily closed from 19 October to 18 November 2020 as a result of the coronavirus measures do not have to demonstrate a decrease in turnover. This derogation does not apply to companies whose turnover in the same period of 2019 is the result of take away activities for 50% or more. They will therefore have to demonstrate a drop in turnover.

Also for cafés and restaurants the subsidy amounts to 10% of the turnover, excluding VAT, with a maximum subsidy of € 7,500 for companies with a maximum of 9 employees and a maximum subsidy of € 15,000 for companies with 10 employees or more.

How much?

The aid amounts to 10% of the turnover, excluding VAT, during the same period in 2019. Self-employed persons in secondary occupations[2] receive 5% aid. For companies that had not yet started up in 2019, the drop in turnover is compared with the expected turnover as stated in the financial plan. The aid is granted at company level.

The maximum aid shall be as follows:

  • If reference period from 1 October to 15 November 2020:
    • o € 11,250 for companies with < 9 employees
    • o € 22.500 for companies with 10 employees or more
  • If reference period from 19 October to 18 November 2020 AND for cafés and restaurants:
    • o € 7,500 for companies with < 9 employees
    • o € 15,000 for companies with 10 employees or more

For self-employed persons in secondary occupation, this maximum aid is halved.

For companies which mainly offer meals[3] and are obliged to use a white cash register, the aid is limited to € 2,250 if they do not have a registered cash register system.

How to apply?

The application can be made via the agency ‘Innoveren en Ondernemen’ (Vlaio). However, this is not yet possible, applications will only be possible from the end of November. The subsidy application shall be submitted by 31 December 2020 at the latest.

Please note!

The measures as described in this infoflash have not yet been published in the Belgian Official Gazette.

Summary

Just to be perfectly clear, we give an overview of both measures:

 

Flemish Protection Mechanism

New Flemish Protection Mechanism

Submit application until

15/11/2020

31/12/2020

 

Reference period for drop in turnover

August and September 2020

1/10 - 15/11/2020 OR

19/10 – 18/11/2020

Drop in turnover

60%

60%

Premium

7,5 % of turnover

10% of turnover

Maximum amount of premium

€ 15,000

€ 22,500

 

Source:

 

 

[1] NACE codes: 56101, 56102 and 56301.

[2] Self-employed person in secondary occupation who in 2019 has a professional income between € 6,996.89 and € 13,993.78 and is not employed as a wage earner for 80% or more.

[3] Either establishments where meals are consumed on a regular basis or domestic caterers providing catering services on a regular basis.

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