Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.
Factsheet for measure SK-2020-25/896 – Updated – measures in Slovakia
|Country||Slovakia , applies nationwide|
|Time period||Temporary, 17 June 2020 – 28 February 2022|
|Type||Legislations or other statutory regulations|
Supporting businesses to stay afloat
– Direct subsidies (full or partial)
|Author||Rastislav Bednarik (IVPR)|
|Measure added||30 June 2020 (updated 07 February 2022)|
The first measures to help entrepreneurship during the COVID-19 crisis were more focused on maintaining jobs. In business, however, there is also a need for spaces that entrepreneurs rent to a significant extent from the owners. This measure in the form of a law is aimed at helping entrepreneurs who rent business premises and for which they have to pay rent. The state subsidy will go to pay part of the rent for the use of the premises, which were closed due to a government regulation for the spread of COVID-19. Entrepreneurs for whom the anti-pandemic measures of the state have limited their income and have rented their premises can apply for a subsidy from the Ministry of Economy for rent in the second wave of the pandemic. As in the first wave, the amount of the subsidy is the same as the discount provided by the landlord.
First, there is a negotiation between the landlord and the tenant about the amount of discount. The state pays the landlord a subsidy in the same amount as he gives the entrepreneur a discount on rent. The ceiling is 50% of the amount of rent for the period of difficult use of space. In such a case, the landlord will forgive half of the rent and the other half of the rent will be refunded by the state.
The tenant for the period will not pay anything for renting the premises. If the landlord and the tenant agree on a lower discount (e.g. 30%), the state will contribute equally (30%) and the rest (40%) must be paid by the entrepreneur renting the premises. In this case, the tenant can spread the payment of unpaid rent in instalments over 48 months. During the payment, the landlord is not entitled to unilaterally increase the amount of rent. The assistance provided to the tenant is financed from the resources of the state budget of the Slovak Republic. The maximum amount of the grant for one applicant is €800,000. The subsidy covers only rent, not energy supply.
Based on a mutual agreement, the renter will ask the landlord to submit an application for a rent subsidy for the period of difficult use. The application is submitted by the landlord on behalf of the tenant, on the landlord's own account. The application must be signed on behalf of both parties, by all authorised persons of both entities, with a qualified electronic signature. The application is submitted to the Ministry of Economy of the Slovak Republic in the period from 23 June 2020 to 30 November 2020. The total amount of available resources provided by the Ministry of Economy for this purpose is €200 million (for about 70,000 to 100,000 applicants). The funds come from national sources.
By 24 August 2020, the MH SR received 9,562 applications for rent subsidies, of which 3,558 have already been paid. The amount of subsidies exceeded €6.5 million. However, the Minister, Richard Sulík, stated that the Ministry expected greater interest from entrepreneurs.
By 1 December 2020, the Ministry of Economy registered 16,890 applications submitted by entrepreneurs and paid them €35.52 million in rental subsidies.
On 3 March 2021, the Minister of Economy informed that the Ministry had already paid out 30,825 applications in the total amount of €56.8 million within the first and second wave of the pandemic. On the contrary, the first assumption that the scheme will be used by 100,000 applicants with an estimated subsidy of €200 million was not met. One of the problems is that landlords are often reluctant to provide a discount to users. According to the Ministry of Economy (14 May 2021), rental subsidies were provided in two rounds. The first round of assistance ended on 30 November 2020 and the Ministry of Economy paid 19,359 applications at the total amount of about €39.9 million. In the second round from 1 December 2020 (as of 14 May 2021), the Ministry of Economy paid more than €49 million in rent subsidies to almost 35,000 applicants.
As of December 3, 2021, the state paid, within the framework of rent subsidies, almost €134 million.
|Does not apply to workers||Applies to all businesses||Does not apply to citizens|
Company / Companies
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Not applicable||Consultation through tripartite or bipartite social dialogue bodies|
Social partners' role in the implementation, monitoring and assessment phase:
The issue of rent subsidies was raised by employers at a meeting of the Economic and Social Council (tripartite body).
The measure was launched in mid June and at the time of writing, the responses of the social partners to the introduced measure are not yet available.
Eurofound (2020), Rent subsidies for business which had to stay closed, measure SK-2020-25/896 (measures in Slovakia), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/SK-2020-25_896.html
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