Commission approves €9.35 million Portuguese employment aid scheme to preserve jobs on the Azores Islands during the coronavirus outbreak

The European Commission has approved a €9.35 million Portuguese aid scheme for preserving employment on the Azores Islands during the coronavirus outbreak. The scheme was approved under the state aid Temporary Framework. It follows two measures approved by the Commission in May 2020, which have expired.  The scheme aims at compensating the wage costs of companies in the Region of the Azores, which would otherwise have laid off personnel due to the coronavirus outbreak and the emergency measures taken by the state to limit its spread.

The period for aid applications is 20 July to 31 December 2020 and aid can be granted as from April 2020. The maximum subsidy period is eight months. For the employers, there are two support options under the notified measure. Under the first option, the wage subsidy will amount to €111.13 per month and employee corresponding to 13.47% of the regional minimum gross monthly salary (including employer's social security contributions) and will be paid in one instalment. Under the second option, the wage subsidy will amount to €196.38 per month and employee, corresponding to 23.8% of the regional minimum gross monthly salary (including employer's social security contributions) which will be paid in three instalments.

The Commission found that the Portuguese measure is in line with the conditions set out in the Temporary Framework. In particular, employers commit to keep the employees covered by the subsidies for the period during which they receive aid. The Commission concluded that the Portuguese measure is necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a member state, in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. On this basis, the Commission approved the measure under EU state aid rules.

More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.58658 in the state aid register on the Commission's competition website once any confidentiality issues have been resolved.

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