Decision on support for selected business sectors and other entities as a result of SARS-COV 2
In recent days, the Government of the Czech Republic has decided on individual programs to support businesses and other entities as a result of the coronavirus epidemic. Below is a brief overview of the individual programs, which were announced mainly on 14 October 2020, 16 October 2020 and 19 October 2020. The government has not yet published the specific conditions of the Antivirus program, the Caregiver’s Program for the “self-employed” and the conditions of the compensatory bonus.
COVID - BUS
The Government of the Czech Republic (the “Government”) decided by Resolution No. 1035 on the establishment of the so-called COVID-BUS program. The essence of this program is the provision of financial support from the state, where the calculation of the amount of remuneration is based on the mechanism of a subsidy for a seat and a day. The support will be calculated until 30 June 2020 and will be announced, evaluated and reimbursed in the 4th quarter of 2020. The amount of individual support is divided according to EURO emission standards for buses, namely subsidies per seat and day from CZK 15 to CZK 135.
COVID – Rent Call 2
Furthermore, by Resolution No. 1037, the Government decided to re-establish the COVID - Rent Call 2 program, which has a similar objective as the COVID - Rent Call 1 program from the first half of this year. The government allocated a total of CZK 1.2 billion for entrepreneurs from the most affected areas. The amount of support is 50% of the decisive rent for the decisive period. The decisive periods are the months of July, August and September. Applications can be submitted from October 21, 2020, 9:00 am to January 21, 2021, 11:59 pm online. The maximum amount of support is CZK 10 million and the amount of support from COVID - Rent Call 1 and Call 2 are not added cumulatively.
Eligible applicants are, in principle, operators whose activities have been explicitly restricted by measures to combat COVID-19, such as catering establishments, clubs, discos, cinemas, congresses and other educational events, exhibitions and fairs, commercially operated sports grounds inside buildings, gyms and fitness centers, wellness, zoo facilities, commercially operated museums, galleries, exhibition spaces, castles, chateaux and similar historical or cultural objects (with the exception of theaters which are the subject of the COVID - Culture program) and a tenant who is (i) an entrepreneur (natural or legal person) performing business activities under the Trade Licensing Act and (ii) uses an establishment that is not owned by him, on the basis of a lease agreement concluded with the lessor and effective before 1 July 2020.
COVID - Culture Call 2
By Resolution No. 1036, the Government also decided to establish the COVID - Culture Call 2 program. The total amount of allocated funds is CZK 750 million. It is possible to apply for (i) support in the amount of 50% for the organization of canceled or deferred cultural events and individual projects, which were to take place in the period from March 10, 2020 to December 31, 2020, and (ii) support in the amount of 80% for eligible expenditure of business entities whose continuous activity in culture has been restricted.
Eligible applicants for this program are businesses that have as their main activity the organization or provision of music, music, drama, dance, theater programs, whose primary goal is to provide cultural services to the public in the field of Performing Arts, including those who have business as a secondary economic activity, namely individual artists and subjects, artistic bodies, galleries and museums for the organization and holding of one-off cultural events, theaters.
Artistic professions in the field of music, theater, dance, both performing artists and professional technical professions in the same fields, can apply for one-time support for self-employed persons in the field of culture.
COVID - SPORT II
By Resolution No. 1038, the Government approved the establishment of the COVID - Sport II program, which, according to a statement from the Ministry of Industry and Trade, will focus on supporting two activities. Sports clubs in league competitions in the sports sector of football, ice hockey, basketball, volleyball and handball will be supported, and sports events that have had to be canceled in connection with government measures will be supported. To date, it has been announced that a total of CZK 500 million will be available.
COVID - Tourism
The Government decided by Resolution No. 1070 on the support of travel agencies, travel agencies and guides in tourism, in the form of the so-called COVID program - Tourism. The total funds provided are CZK 500 million and the support will take the form of a subsidy.
For travel agencies, the amount of support is a maximum of 2.75% of the planned revenues from the sale of tours and the sale of tourism services that are part of the combined travel services for 2020. Travel agencies will use these funds to cover purposefully incurred operating costs for the period from 20. 2. 2020 to 10. 10. 2020.
Travel agencies will receive CZK 500 for a canceled trip due to a pandemic, which was purchased (a trip contract was concluded) in the period from 1 December 2019 to 1 October 2020 and for a canceled spa stay at a spa in the Czech Republic, which could not be implemented at the time of closure of the spa facility. Alternatively, they will receive an amount of CZK 50,000 in respect of a travel agency that primarily deals with inbound tourism.
Guides in tourism will receive a subsidy in the total amount of CZK 50,000, provided that (i) they provide free educational services of at least 10 hours to school facilities (according to the work report confirmed by the school principal) and / or (ii) complete further education or retraining a course accredited by the Ministry of Education, Youth and Sports for the purpose of further employment on the labor market (eg pedagogical minimum). If the applicant does not meet these special conditions, but meets the general ones, then the total amount of the subsidy can be only CZK 40,000.
COVID - Accommodation
Among other things, it is still possible to apply for support in the area of accommodation facilities (until 30 October 2020), when the total allocated funds are CZK 1 billion. Within the COVID - Accommodation Program, the government assumed that the average price of loss of accommodation facilities in the monitored period of 72 days was approximately CZK 970 per day and room and decided to provide a subsidy of 26% of damage from accommodation cancellation. The average price of the subsidy per room and day is CZK 251, while the amount of the subsidy is graded according to the type of accommodation facilities from CZK 100 to CZK 330.
COVID III guarantee
It is still possible to apply for support provided in the form of a guarantee of the Czech-Moravian Guarantee and Development Bank for the provision of a loan by commercial banks to final beneficiaries who have a business license to do business in the Czech Republic. The following conditions must be met (i) companies with up to 250 employees up to 90% of the principal of the guaranteed loan, but not more than CZK 45 million, with a maximum guarantee period of 3 years and (ii) companies with 250 to 500 employees up to 80% the principal of the guaranteed loan, however, not exceeding CZK 40 million, where the duration of the guarantee is a maximum of 3 years. The maximum amount of the guaranteed loan may not exceed CZK 50 million. The agreed maturity of the loan may not occur before 1 January 2021, with the exception of loans agreed for an indefinite period.
The conditions for eligibility are that the transaction must meet the following criteria: (i) it will be carried out in the Czech Republic, (ii) does not provide for other public support, de minimis aid for the same guaranteed loan and the guaranteed loan must not be supported by a directly managed European Union instrument; iii) was not supported in the COVID Plus program (note the program managed by EGAP).