Background information

The government has established a compensation scheme where the state covers parts of the fixed costs for companies that have had at least 30% decrease in turnover due to the outbreak of COVID-19 and infection control measures. The goal is to help the business sector avoid bankruptcies and recover quickly after the crisis is over. The scheme is temporary and will apply for the months of March, April and May. The government has set up a dedicated site where the companies can apply for grant to cover fixed and unavoidable costs. It is meant to be both easy to use and manage, and designed to give quickly imbursement. The scheme was designed by the government in close collaboration with The Confederation of Norwegian Enterprise (NHO), The Norwegian Confederation of Trade Unions (LO), Enterprise Federation of Norway (Virke), SMB Norway, Norwegian Employers Association for the Financial Sector (FA) and the Tax Administration. The EFTA Surveillance Authority ESA has approved the scheme.

Content of measure

The Business Compensation Scheme will comprise companies with at least 30% drop in sales compared to the same month the year before. For March, the rate will be 20%, since the strict anti-infection measures were first introduced on March 12. The scheme will initially apply to March, April and May, and payments will be made in arrears based on actual sales in the months in question. A two-part model is used for calculating compensation.

1. Companies instructed by the state to shut down to prevent spread of COVID-19 virus will be able to apply for compensation of up to 90% of their unavoidable fixed costs in the specified months, calculated as follows: reduction in turnover x unavoidable fixed costs x 90 percent adjustment factor.
2. Firms that are not required to shut down, but still experiencing a reduction in turnover of 30% or more (20% in March), will have to pay an excess. Compensation is calculated as follows: reduction in sales x (unavoidable fixed costs - excess of NOK 10,000/approximately €890) x 80% adjustment factor. The minimum limit for compensation is NOK 5,000. If the support per enterprise exceeds NOK 30 million per month, the excess will be bisect.

Use of measure

No information to date.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Applies to all businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government Social partners jointly Trade unions Employers' organisations	National funds

Social partners

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

	Trade unions	Employers' organisations
Role	Consulted	Consulted
Form	Direct consultation outside a formal body	Direct consultation outside a formal body

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

• Unknown
• Main level of involvement: Peak or cross-sectoral level

Involvement

The social partners have been consulted regularly during design and implementation of the measure.

Views and reactions

The social partners have been supportive of the measure.

Sources

• 02 April 2020: Foretak med minst 30 % omsetningsfall kan få kompensasjon (www.regjeringen.no)
• 17 April 2020: Act on temporary grant scheme for enterprises with a large drop in turnover (lovdata.no)
• 19 April 2020: Business Compensation Scheme (kompensasjonsordning.no)
• 01 July 2020: Endringer i kompensasjonsordningen (www.regjeringen.no)