EU approves state aid to support package travel organizers

Mar 3, 2021 Benn-Ibler Rechtsanwälte

The European Commission has approved a €300 million scheme for package travel organizers and intermediaries of linked travel arrangements

Austria has registered a €300 million state guarantee scheme for approval by the Commission. This support measure aims to ensure that sufficient resources are available to reimburse consumers for cancelled travel services when package travel organizers and intermediaries of linked travel arrangements become insolvent.

In Austria, according to the EU Directive 2015/2302, package travel organizers and intermediaries of linked travel arrangements are obliged to ensure that amounts already paid for travel services (e.g. in the case of insolvency of an organizer) are refunded.

The registered scheme grants aid in the form of a state guarantee covering 100 % of the beneficiaries' liability for travel services that cannot be provided or can only be provided in part due to the outbreak of COVID-19, in case of insolvency of the beneficiaries.

The Commission has examined the scheme notified by Austria under EU state aid rules and in particular Article 107(3)(b) of the Treaty on the Functioning of the European Union (TFEU). This provision authorizes Member States to grant aid to remedy a serious disturbance in their economy. On 19 March 2020, the EU Commission adopted a Temporary Framework based on Art 107(3)(b) TFEU to allow Member States to make full use of the scope provided for in the state aid rules so that the economy is supported during the COVID 19 pandemic.

The European Commission found that the notified measure is necessary, appropriate and proportionate to remedy a serious disturbance in the Austrian economy. The measure complies with Article 107(3)(b) TFEU and the conditions laid down in the Temporary Framework. Consequently, the scheme was to be approved under the EU state aid rules.

EU Commission press release (04.02.2021)