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COVID-19 EU PolicyWatch

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Eurofound's COVID-19 EU PolicyWatch collates information on the responses of government and social partners to the crisis, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for case EE-2020-20/962 – Updated – measures in Estonia

Grants for SMEs and entrepreneurs in tourism, accommodation, catering, travel and commerce sectors

Turismi-, majutuse-, toitlustuse-, reisi- ja kaubandusettevõtete toetused

Country Estonia , applies nationwide
Time period Open ended, started on 11 May 2020
Type Legislations or other statutory regulations
Category Supporting businesses to stay afloat
– Direct subsidies (full or partial)
Author Ingel Kadarik (Praxis Center for Policy Studies) and Eurofound
Case created 10 July 2020 (updated 20 July 2021)

Background information

In tourism, accommodation and food, and commerce sectors, several companies were in difficult financial situation due to the COVID-19 related containment measures resulting in significant or total loss of income. With the adoption of the supplementary state budget on 15 April 2020, the Ministry of Economic Affairs and Communication supports those companies via Enterprise Estonia (EAS), a state-founded foundation which aims at developing the Estonian economy.

Content of measure

In May and June 2020, Enterprise Estonia provided seven different grants to partially compensate the losses due to the COVID-19 outbreak of:

  • micro and small companies (all sectors)
  • accommodation companies
  • catering companies
  • travel agencies
  • tourism attractions
  • tourism companies
  • commerce and service companies (for compensating their rental fees)

Each grant has its own eligibility criteria and terms and conditions. Overall, the amount of the grant per company could be between €2,000 and €60,000, depending on the specific grant. For compensation of the rental fee, the minimum amount was €100. The total budget allocated to compensate the losses was €36.5 million.

Updates

The following updates to this measure have been made after it came into effect.

21 April 2021

From the additional state budget, €44 million was additionally allocated to tourism (€25 million) and commerce (€19 million) related fields. The application rounds were open between 17 May and 27 May.

The general conditions are that the applicant were eligible for support if the decline in turnover was at least 30% in March 2021 compared to the average monthly turnover of 2019. The support equals to 60%-90% of the labour costs of February 2021 multiplied by the actual percentage of the decline in turnover and multiplied again by two or three, depending on the measure. If the company has established after 2019, the support was calculated taking account only the labour costs and not the change in turnover. Self-employed receive a lump sum of €1,400 or €2,000, depending on the measure.

The specific fields of support, budgets and share of labour costs compensated:

  1. accommodation companies, spas and water centers - €15.1 million, 90% of labour costs compensated;
  2. catering companies – €12.4 million, 70% of labour costs compensated;
  3. meetings and trade fair undertaking – €600,000, 60% of labour costs compensated;
  4. travel services provider – €1.5 million, 60% of labour costs compensated;
  5. support designated for undertakings engaged in other carriage of passengers by road – €800,000 90% of labour costs compensated;
  6. retail undertaking – €11.3 million, 70% of labour costs compensated (multiplied by 2; self-employed receive €1,400);
  7. tourism companies – €1.9 million, lump sum paid €7500 for companies, €2,000 for self-employed;
  8. regular carriers – €4 million, up to €1.8 million per applicant, support is calculated based on the labour taxes and the turnover in 2019.
26 March 2021

The support measure described in the previous update was launched on 26 March 2021. The application rounds were open from 29 March until 8 April. The allocation of the budget was:

  • max €180,000 per company (total €4.27 million) for accommodation companies.
  • max €80,000 per company (total €2.8 million) for travel and transport companies.
  • max €80,000 per company (total €2.64 million) for restaurants in the capital's old town.
  • max €60,000 per company (total 320,000) for handicraft and souvenir stores.
30 December 2020

On 30 December, it was decided via EAS that additional funds to accommodation companies, travel companies, restaurants in the capital's old town and to handicraft and souvenir stores will be allocated in the first quarter of 2021 after receiving state aid permission from the European Commission. The Government will allocate €5 million from its reserve and the unused funds from application rounds in Spring will also be used for this measure. The total budget is therefore €9.9 million.

08 October 2020

As the initial budget allocated for these measures was not entirely used, the Government decided on 8 October 2020 that the unused finances (€5.8 million) will be allocated to tourism sector, of which €200,000 will be allocated to the organisers of international concerts to cover their losses. The other target groups are companies of accommodation, attractions, tourism services, international transport services and travel and guides. The support per company will be between €2,000 and €60,000, while for guides and tourism services there will be flat grants of €3,000 and €5000, depending on their turnover and for transport services the support can be up to €200,000 per company. The specific terms and conditions will be developed by the support providers (Enterprise Estonia, Ministry of Economic Affairs and Communication, and Ministry of Culture) by, probably, November 2020.

Use of measure

By 12 April 2021, 6,991 applications have been submitted of which 4,141 in the total amount of €33.8 million have been approved.

By 8 July 2021, 9,668 applications have been submitted of which 6,538 in the total amount of €76.9 million have been approved.

Data available on the EAS webpage .

Target groups

Workers Businesses Citizens
Does not apply to workers Sector specific set of companies
SMEs
One person or microenterprises
Does not apply to citizens

Actors and funding

Actors Funding
National government
Public support service providers
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role No involvement as case not in social partner domain Consulted
Form Not applicable Any other form of consultation, institutionalised (as stable working groups or committees) or informal

Social partners' role in the implementation, monitoring and assessment phase:

  • No involvement
  • Main level of involvement: Sectoral or branch level

Involvement

A number of different sectoral social partners were involved – they proactively provided their opinions and suggestions, which also received written feedback from the Ministry. Instead of peak-level social partners, they were concentrated more on sectoral social partners.

Views and reactions

No information.

Sectors and occupations

    • Economic area Sector (NACE level 2)
      G - Wholesale And Retail Trade; Repair Of Motor Vehicles And Motorcycles G46 Wholesale trade, except of motor vehicles and motorcycles
      G47 Retail trade, except of motor vehicles and motorcycles
      I - Accommodation And Food Service Activities I55 Accommodation
      I56 Food and beverage service activities
      N - Administrative And Support Service Activities N79 Travel agency, tour operator and other reservation service and related activities

This case is not occupation-specific.

Sources

  • 11 May 2020: Compensation for small companies (väikettevõtete toetus) (www.eas.ee)
  • 11 May 2020: Support for accommodation companies (Majutusettevõtete toetus) (www.eas.ee)
  • 11 May 2020: Support for catering companies (Toitlustusettevõtete toetus) (www.eas.ee)
  • 11 May 2020: Support for travel conpanies (Reisiettevõtete toetus) (www.eas.ee)
  • 11 May 2020: Support for tourism attractions (Turismiatraktsioonide toetus) (www.eas.ee)
  • 11 May 2020: Support for tourism companies (Turismiteenuste pakkujate toetus) (www.eas.ee)
  • 02 June 2020: Rent fee support for commerce and service companies (Kaubandus- ja teenindusettevõtete renditoetus) (www.eas.ee)
  • 08 October 2020: Additional support in tourism sector (Valitsus otsustas turismisektori kriisitoetuste tingimused) (www.kriis.ee)
  • 31 December 2020: Additional support 31 December (Valitsus eraldas erahuvihariduse- ja tegevuse pakkujatele kriisitoetuseks 2,74 miljonit eurot) (www.hm.ee)
  • 26 March 2021: Additional support in 2021 (Lisatoetus 2021) (www.eas.ee)
  • 29 March 2021: Additional measures 2021 - terms and conditions (Lisameetmete tingimused)
  • 21 April 2021: EAS support measures April 2021 (EAS toetusmeetmed aprill 2021) (www.riigiteataja.ee)
  • 26 April 2021: Regular carrier support April 2021 (Kommertsliiniveo toetus aprill 2021) (www.riigiteataja.ee)

Citation

Eurofound (2020), Grants for SMEs and entrepreneurs in tourism, accommodation, catering, travel and commerce sectors, case EE-2020-20/962 (measures in Estonia), COVID-19 EU PolicyWatch, Dublin, http://eurofound.link/covid19eupolicywatch

Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process. All information is preliminary and subject to change.