Coronavirus: Flemish Protection Mechanism TER

In a previous infoflash, we have already explained the Flemish Protection Mechanism and the New Flemish Protection Mechanism. In order to meet the consequences of the more stringent measures the Consultative Committee introduced on 28 October and 1 November, the Flemish Government is taking 2 measures:

• Setting up of a Flemish protection mechanism TER;
• Modification of the New Flemish Protection Mechanism (BIS).

For whom?

In tangible terms, any entrepreneur who suffers a loss of turnover of at least 60% between 16 November and 31 December 2020 (= the reference period) as a result of the corona measures will be able to call on the new Flemish Protection Mechanism ‘TER’.

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 hospitality sector (= hotels, restaurants and cafés) do not have to demonstrate this loss of turnover!
• Only companies with an active business conduct during the reference period 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.
• Companies that were obliged to close down within the reference period may choose to apply for aid only for the period of mandatory closure. The aid then applies on a pro rata basis and the drop in turnover does not have to be demonstrated;
• Companies that derive 50% or more of their turnover from subcontracting to a closed sector (e.g. suppliers to the hospitality sector) may opt for a reference period that corresponds to the compulsory closure period of that closed sector. However, they will have to demonstrate a 60% drop in turnover.

Exception for the hospitality sector:

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

For cafés and restaurants, the subsidy also amounts to 10% of the turnover excluding VAT for the period in 2019 corresponding to the mandatory closure period.

Exception for sectors subject to manadatory closure

No drop in turnover has to be demonstrated if on 16 November, the main activity of the company falls within the eligible sectors and the company has been mandatorily closed as a result of the coronavirus measures. The subsidy amounts to 10% of the turnover excluding VAT for the period in 2019 corresponding to the mandatory closure period.

The Minister of Economy may amend the list of eligible sectors if additional sectors are required to be closed.

How much?

The aid amounts to 10% of the turnover, excluding VAT, during the same period in 2019. Self-employed persons in a secondary occupation[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 will amount to:

• • o € 11,250 for companies employing < 10 employees
  • o € 22,500 for companies employing10 to 49 employees
  • o € 60,000 for companies employing 50 employees or more
• The minimum aid amounts to € 1,000 for the reference period 16 November - 31 December 2020.
• 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), after the end of the reference period. The subsidy application must be submitted by 15 February 2021 at the latest.

Important note!

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

Amendments to the ‘New Flemish Protection Mechanism’ or ‘Protection Mechanism BIS’

This decree also aims to amend the Flemish Protection Mechanism BIS, approved by the Flemish Government on 23 October 2020. The following adjustments will be made:

• introduction of a minimum amount of aid, analogous to the Flemish Protection Mechanism TER;
• introduction of an aid ceiling for companies employing 50 employees or more, analogous to the Flemish Protection Mechanism TER;
• the end date on which the aid measure applies is generically set at 15 November 2020; this adjustment avoids any interruption between the BIS and TER mechanisms, which starts generically on 16 November 2020;
• establishment of a list of sectors subject to mandatory closure and that is annexed to the Decree;
• the end date of the closure period eligible for a subsidy within the context of the Decree of the Flemish Government of 23 October 2020 is set at 15 November 2020;

Overview

Source:

• Decree of the Flemish Government of 13 November 2020 concerning the Flemish Protection Mechanism for companies that have suffered a drop in turnover as a result of the stricter corona measures taken from 28 October 2020 and amending Article 1, 3 and 4 of, and adding an annex to, the Decree of the Flemish Government of 23 October 2020 concerning the Flemish Protection Mechanism for companies that have suffered a drop in turnover as a result of the stricter corona measures taken on 6 and 16 October 2020 and amending Article 6 of the Decree of the Flemish Government of 20 March 2020 granting aid to companies that have to close down as a result of the measures taken by the National Security Council as of 12 March 2020 concerning the coronavirus.

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

[2] A self-employed person in a 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.