EU approves Danish compensation scheme for cancellations of large public events
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The European Commission has found a DKK 91 million (€12 million) Danish aid scheme to compensate organisers for the damage suffered due to the cancellation of large events with more than 1,000 participants due to the Covid-19 outbreak to be in line with EU State aid rules.
This is the first and only State aid measure notified by a Member State to the Commission in relation to the COVID-19 outbreak so far. The Commission approved the scheme under EU State aid rules within 24 hours of receiving the notification from Denmark.
The Commission stands ready to work with all Member States to ensure that possible national support measures to tackle the outbreak of the Covid-19 virus can be put in place in a timely manner, in line with EU rules.
To this end, the Commission has established a dedicated contact point for Member States to provide them with guidance on possibilities under EU rules.
Executive Vice President Margrethe Vestager, in charge of competition policy, said: “With the scheme, Denmark will compensate the organisers of events cancelled due to the Covid-19 outbreak for the losses suffered.
This is the first State aid measure notified to us by a Member State in relation to the Covid-19 outbreak. We stand ready to work with all Member States to ensure that possible national support measures to tackle the outbreak of the virus can be put in place as quickly and effectively as possible, in line with EU rules.”
On 11 March 2020, Denmark notified the Commission of its intention to set up a DKK 91 million (€12 million) aid scheme to compensate organisers of events with more than 1,000 participants or targeted at designated risk groups, such as the elderly or vulnerable people, irrespective of the number of participants, which had to be cancelled or postponed due to the COVID-19 outbreak.
Under the scheme, operators would be entitled to be compensated for the losses suffered as a consequence of the cancellations or postponment the events, for which, for example, tickets were already sold.
The Commission assessed the measure under article 107(2)(b) of the Treaty on the Functioning of the European Union (TFEU), which enables the Commission to approve State aid measures granted by Member States to compensate specific companies or specific sectors (in the form of schemes) for the damages directly caused by exceptional occurrences.
The Commission considers that the Covid-19 outbreak qualifies as an exceptional occurrence, as it is an extraordinary, unforeseeable event having a significant economic impact. As a result, exceptional interventions by the Member States to compensate for the damages linked to the outbreak are justified.
The Commission found that the Danish aid scheme will compensate damages that are directly linked to the Covid-19 outbreak. In this respect, the scheme will contribute to address the economic damage caused by the Covid-19 virus in Denmark. It also found that the measure is proportionate as the foreseen compensation does not exceed what is necessary to make good the damage.
The Commission therefore concluded that the scheme is in line with EU State aid rules as it will contribute to mitigate the negative consequences of Covid-19 for Danish businesses, without unduly distorting competition in the Internal Market.
