COVID-19 Serbian State Aid Two New Regulations

1. Regulation on Conditions and Criteria on State Aid Harmonization for Remedy of Consequences Caused by Covid-19 Infectious Disease (Uredba o uslovima i kriterijumima usklađenosti državne pomoći radi otklanjanja štetnih posledica prouzrokovanih epidemijom zarazne bolesti Covid-19),and
2. Regulation on Conditions and Criteria on State Aid Harmonization for Remedy of Serious Disorder in the Economy Caused by Covid-19 Infectious Disease (Uredba o uslovima i kriterijumima usklađenosti državne pomoći radi otklanjanja ozbiljnog poremećaja u privredi prouzrokovanog epidemijom zarazne bolesti Covid-19).

Regulation on Conditions and Criteria on State Aid Harmonization for Remedy of Consequences Caused by COVID-19 Infectious Disease

State aid for the remedy of consequences – damage caused by the epidemic of COVID-19 can be granted to those market participants who clearly and unequivocally prove the causal link between the actual loss and epidemic of COVID-19, whereas:

1. the total amount of aid shall not exceed the amount necessary to cover the eligible costs;
2. if State aid is granted on the basis of the scheme, the period of validity of the measure, the total budget, the aid instrument, the intensity, and the beneficiaries shall be determined (estimated number of beneficiaries, sector of the economy and other relevant information);
3. the actual loss shall not occur as a result of non-compliance with the positive regulations during the COVID-19 infectious disease epidemic;
4. the beneficiary shall not be directly responsible for the occurrence, that is, he shall not grossly negligent or knowingly contribute to the actual loss.

Before granting of State aid, the beneficiary shall be obliged to submit certain reports and/or documents as prescribed in the Regulation. The State aid granted under this regulation shall not be cumulated with other State aid given pursuant to other regulations.

Regulation on Conditions and Criteria on State Aid Harmonization for Remedy of Serious Disorder in the Economy Caused by COVID-19 Infectious Disease

State aid for the remedy of serious disorder in the economy caused by epidemic COVID 19 shall be granted in the form of State aid for the liquidity of market participants under the conditions prescribed in the Regulation, through following instruments:

1. State aid for market participants’ liquidity in the form of subsidies, debt write-offs, tax breaks;
2. State aid for market participants’ liquidity in the form of subsidized interest rates for loans;
3. State aid for the liquidity of market participants in the form of loan guarantees on terms more favorable than market terms;
4. State aid for market participants’ liquidity in the form of tax deferrals and/or social security contributions (aid measure in the form of tax deferrals and/or social security contributions does not constitute State aid if it applies to the whole economy or to all market participants without exception);
5. State aid for the liquidity of market participants in the form of subsidies for employees’ salaries in order to avoid dismissal during the COVID – 19 epidemic (aid measure in the form of subsidies for employees’ salaries in order to avoid dismissal during the COVID – 19 epidemic does not constitute State aid if it applies to the whole economy or to all market participants without exception);
6. State aid for market participants’ liquidity in the form of short-term export insurance (state guarantees for short-term export credit insurance against market risks are prohibited and are only allowed for export credit insurance against non-market risks – COVID 19).

For each of the above-stated instruments, the Regulation prescribes in a detailed manner the conditions and the manner or schemes for granting the State aid.

State aid for the liquidity of market participants may be cumulated with other types of State aid under the Regulation on State aid rules, provided that the costs are justified.

Keeping of records

All beneficiaries of State aid granted under both Regulations shall be obliged to keep records of state aid granted and submit to the State Aid Control Commission a State aid report by 1 June 2021 at the latest.