Kategória: Corona

Amendments to public procurement law in view of drafted “Anti-Crisis Shield 2.0”

Posted on by Lisa Fortmüller

A draft of so-called “Anti-Crisis Shield 2.0” has just reached the Sejm (the “Draft Bill”). The Draft Bill contains further amendments to the special-purpose act already in place, incl. ones revising the Public Procurement Law (the “PPL”). Below you will find a summary of the proposed changes.

AMENDMENTS TO PUBLIC CONTRACTS

1.1. It is still possible to modify a contract executed under PPL in terms of deadline, manner of contract performance, scope of services and preclusion of contracting authorities’ liability (incl. those that award utility contracts) for refraining from determination and pursuit of contractor’s financial obligations (e.g. contractual penalties), or for introduction of amendments to contracts – upon the conditions specified in the Draft Bill.

1.2. The Draft Bill expands the list of circumstances (related to COVID-19) which affect or may affect contract performance, of which the parties should notify each other. Based on the Draft Bill, the circumstances will include “other circumstances which prevent or materially hinder contract performance.”

1.3. The circumstances listed in the last version of the Anti-Crisis Shield, as well as the ones proposed in the new version will apply to subcontractors and further subcontractors equally.

1.4. The Draft Bill includes a new provision applicable to contractors based outside Poland which reads as follows: “where a contractor is based or carries out actions related to contract performance outside Poland, the documents issued by relevant institutions in the countries or such contractors‘ statements shall be required instead of the documents referred to in subsections 1 – 5. ”

1.5. The Draft Bill also modifies the rule of amending public contracts in terms of remuneration. The provision currently in effect: “a change of the scope of services provided by the contractor and a corresponding adjustment of the contractor’s remuneration, provided that the increase of the remuneration resulting from each consecutive change is not higher than 50% of the original contract value” will be replaced with the following provision: “a change of the scope of services provided by the contractor and a corresponding adjustment of the contractor’s remuneration or manner of settling the contractor’s remuneration.” This means that an adjustment of remuneration or the manner of settling the remuneration will go hand in hand with the change of the scope of the services – based on the special-purpose act (its former and new version) it is not possible to seek an adjustment of the remuneration (the manner of settling the remuneration) without changing the scope of the services as well.

1.6. Based on the Draft Bill, public contracts will be executed in accordance with the following provision: “During the state of epidemic threat or the state of epidemic and the ensuing travel restrictions, public contracts are executed in written form (or are otherwise null and void) or in electronic form with qualified electronic signature, provided that the contracting authority consents to such manner of executing the contract. ”

1.7. It is expected that the provisions of the Draft Bill will apply to those public contracts which are not covered by the provisions of the PPL.

1.8. The same rules of notification and contract amendment were introduced with respect to offset contracts executed on the basis of the Act on Selected Contracts Executed in Connection with the Performance of Contracts of Fundamental Importance for National Security of June 26, 2014.

1.9. On a side note, it is worth adding that in order to introduce amendments to a public contract, it is necessary for parties to reach an understanding and enter into an amending annex. This means that claims of one of the parties do not automatically lead to amendments. The same is true for changes that could be related to the current COVID-19 threat.

CONTRACTING AUTHORTIES’ LIABILITY

There have been no changes to the provisions involving the preclusion of contracting authorities’ liability, arising from the Liability for Breach of Public Finance Discipline Act, for amendments to a public contract and refraining from determination and pursuit of claims arising from non-performance or improper performance as a result of circumstances related to COVID-19.

NATIONAL APPEALS CHAMBER

1.1. The Public Procurement Office together with the National Appeals Chamber and the Ministry of Development are working on solutions that would allow the National Appeals Chamber to resume hearing appeals.

1.2. Based on the information available on the Public Procurement Office’s website, a temporary procedure has been developed, where the National Appeals Chamber is to issue rulings on the basis of documents provided by the parties, however, further organizational and legislative changes are required for the purpose of implementing this solution.

Given the foregoing, we recommend filing appeals online, using a qualified electronic signature.

We reiterate all our recommendations for contractors and contracting authorities, related to the current situation, as provided in the previous alerts (alert 1 i alert 2).
We are ready to assist you in evaluating your particular situation. Please feel free to contact us any time by email or telephone.

Is there a risk for companies to be exposed to criminal investigations for non-complying with the measures implemented by the authorities?

Posted on by Ana Pandelea

Context

Following the accelerated spread of COVID-19, the President of Romania declared the state of emergency for a period of 30 days as of 16 March 2020. According to the latest press statements this will most likely be extended by an additional thirty days term.

One of the first measures announced by the Romanian prime minister was the tightening of the criminal laws regarding the offenses of spreading the infectious diseases. The purpose of adopting the new regulation was to enforce compliance with the measures taken by the authorities to prevent and stop the spread of COVID-19.

In recent weeks the national criminal investigation bodies have announced the opening of more than 200 criminal investigations.

The main crime pursued is the Preventing the fighting of diseases that incriminates the failure to comply with the measures taken for the prevention and combating of infectious and contagious diseases, if this resulted in the spreading of the disease.

Pursuant to Article 135 of the Criminal Code, the legal entities shall have criminal liability for offenses committed in relation to the performance of their object of activity or in their interest or their behalf. The criminal liability of legal entities does not exclude the criminal liability of the individual(s) participating in the commission of the same offense.

Which are the implications for companies who do not comply with obligations established by the authorities?

Although the main legislative changes concern the facts committed by natural persons who, for example, do not comply with the quarantine or isolation measures, the offense provided in Article 352 par. (2) of the Criminal Code also incriminates the acts committed by legal entities that do not comply with the obligations established by the authorities.

For a company to be liable, the following conditions must be met:

  1. The failure to comply with a pre-existing obligation or with measures ordered by public authorities in order to prevent or combat spreading of Coronavirus (such as the obligation of all companies to provide all the materials intended for personal hygiene, to disinfect frequently door locks and other exposed areas, like conference tables). The mandatory measures ordered by the authorities are established by the military ordinances or the emergency ordinances of the government . So far, the Ministry of Labor has issued a series of recommendations but not all of them mandatory for companies. The breach of the recommendations cannot trigger the criminal liability of legal entities;
  2. the breach of measures results in the infection of at least one person with COVID -19 virus.

Sanctions

The penalties applicable to legal entities breach the criminal law provisions include fines and other ancillary measures such as: the suspension of the activity or of one of the activities performed by the legal entity for a term between three months and three years or the closure of working points of the legal entity for a term between three months and three years or in worse case scenarios even the winding-up of the legal entities.

If a legal entity is held liable for Preventing the fighting of diseases as indicated in Article 352 par. (2) of the Criminal Code, the court can sentence the legal entity to a fine of up to 300,000 euros.

In case the preventing of fighting of diseases offence is committed involuntary, the fine can be established to a maximum of approx. 185,000 euros.

Also, the companies can be held liable for the offences regarding labor health and safety rules, such as the Failure to take labor health and safety measures if an employee is infected with COVID-19 following non-compliance with the labor protection measures. For instance if a company does not comply with the measures imposed by the authorities regarding the avoidance of the spread of COVID-19 and as a result of these non-compliance a client of the company is infected with COVID-19, the company will be criminally liable for  the crime of preventing the fighting of diseases. If this non-compliance has the consequence of creating an imminent danger for infecting the company’s employees with COVID-19 during the course of their professional activity, the company will be criminally liable also for the offense of Failure to take labor health and safety measures.

Recommendations

In order to avoid criminal investigations regarding this matter, the companies should develop a contingency and business continuity plan for an outbreak in the communities where their business operates, taking into consideration the guidance published by the World Health Organization.

Companies need to remain alerted and take note of and effectively implement the measures decided by the public authorities on an almost daily basis.

Main changes in Hungary due to the announced state of emergency

Posted on by Lisa Fortmüller

Since the World Health Organization (WHO) declared the rapidly spreading coronavirus a pandemic, people are increasingly affected by government, employers and many other decisions.

Due to the COVID-19 disease, the government declared a state of emergency in the territory of the Hungary on March 14, 2020. In the state of emergency, the Hungarian government has ordered extraordinary measures to prevent the health and life of the Hungarian people from the now pandemic coronavirus.

Exceptional measures led to create the 47/2020 (III.18.) and 61/2020 (III.23.) Government Decrees, which aim to ensure economic performance and survival of the small and medium-sized enterprises in Hungary.

  • Loan moratorium

Government Decree 47/2020 (III.18.), on the measures to protect the national economy, has been published in the Hungarian National Gazette. The decree contains the details of the loan moratorium announced by the Prime Minister previously. Furthermore, it declares provisions to reduce the burden on the sectors most affected by the effects of the COVID 19 epidemic.

Under the decree, all the debtors – whether businesses or individuals – will be deferred until December 31, 2020 in respect of payment obligations arising from loan, loan or financial lease contract entered. During the moratorium, the debtor is not obliged to pay any capital, interest, or other charges arising from such contracts, as the deadline extended.

The payment extension period modifies the period of completion and the maturity, meaning that the terms of these contracts are extended from March 18, 2020 to December 31, 2020. Thus, it is not to be expected that the banks will eventually seek a lump sum repayment during the moratorium, but the contracts (and all repayment installments) will be extended by approximately 9 months. Of course, the debts will continue to yield interest, but this additional cost is expected to be included by the banks in the future installments.

  • Temporarily the Government exempts low-income enterprises and individuals from paying their taxes

In addition to the credit moratorium, another major change came into force by the 47/2020 (III. 18.) decree. The Government exempted the „low-income” entrepreneurs such as taxi drivers, passenger transport companies, from taxation. (In Hungary this tax type is named ’KATA’, hereinafter: „KATA”).

The 61/2020 (III.23.) Government Decree clarified the scope of the activities which „benefit” from the tax and contribution concessions granted by the decree. This recent decree has significantly extended the scope of activities which do not have to pay KATA until the state of emergency. It means that, at the moment hairdressers, personal trainers, painters, dentists, hospitality practitioners, waiters/waitresses etc., whose income is mostly affected by the epidemic, do not have to pay their taxes in this period.

  • Suspension of executions

One of the other changes which came into force by the 60/2020 (III.23.) Government Decree is the suspension of the executions and tax executions from March 24, 2020, until the 15th day after the state of emergency has ceased. In fact, if the end of the state of emergency occurred during the fall or winter, then the evictions could only continue next April, in 2021.

Until the end of the state of emergency, an on-the spot procedure, and an auction may not be held and no on-site procedural action may be taken. These procedures and actions can only be done once the state of emergency has ceased, with the time limit for taking the procedural action restarting on the 15th day after the cessation of the emergency.

New Insolvency Rules Resulting from the COVID-19 Pandemic

Posted on by Gabriela Fuchsová

The current unusual situation caused by the COVID-19 pandemic will undoubtedly have substantial consequences for the economy of the Czech Republic. It can be expected that the amount of debts will rise sharply not only on the side of the state, but also on the side of citizens and business entities. Subsequently, many of these debts are not going to be repaid. Therefore, such debts will be claimed before the courts and other competent authorities sooner or later and subsequently enforced (either individually through enforcement proceedings or collectively through insolvency proceedings).

The current emergency may thus lead to the bankruptcy of many entrepreneurs, both in the form of insolvency and in the form of over-indebtedness. In spite of the current extraordinary situation, entrepreneurs are still obliged to file an insolvency petition without undue delay after they have learned of their insolvency or should have learned about it exercising due care. This obligation is also not affected by the fact that the insolvency could have been caused by the current emergency and it could be expected that the debtor will be able to recover from the inability to pay its debts in the near future (the so-called temporary insolvency). This puts many entrepreneurs at considerable risk, as their personal property may also be at stake. Failure to file the insolvency petition creates the liability of these persons (including members of the statutory body) for damages.

On March 31, 2020, the Government of the Czech Republic tried to mitigate the negative consequences of the COVID-19 pandemic on the economic situation of citizens and entrepreneurs by passing a bill (adopting draft legislation) to amend, inter alia, the Insolvency Act and the Act on Private Enforcement Procedure (hereinafter referred to as the „Amendment“). The Czech Republic thus follows the countries such as Germany or Spain which have already adopted certain changes to their enforcement or insolvency regulations.

The most important proposed changes to the Czech insolvency law can be summarized as follows:

1.Limitation of the obligation of entrepreneurs to file debtor insolvency petitions: A new rule is introduced for entrepreneurs not being obliged to file a debtor insolvency petition within the period from the effective date of the Amendment until 6 months from the termination or cancellation of an emergency anti-epidemic measures (but no later than by December 31, 2020). An exception to this rule exists when (i) the insolvency occurred even before an emergency anti-epidemic measure was adopted, or (ii) the insolvency was not mostly caused by the emergency anti-epidemic measure that would make it impossible or substantially difficult for the debtor to fulfil its payment obligations.

2. Limitation of creditor insolvency petitions: Creditor insolvency petitions filed from the effective date of the Amendment till August 31, 2020 will not be taken into account. Thus, there is a legal fiction that no such insolvency petition will have been filed. Therefore, such filing will not even be published in the insolvency register. The purpose of this measure is, inter alia, to prevent the debtor from spending money to defend against a creditor’s insolvency petition. However, the creditors will still be entitled to exercise their civil-law rights (e.g. by offsetting or enforcing a collateral), in court proceedings or out of court. [1] This measure – unlike the limitation of the obligation of entrepreneurs to file debtor’s insolvency petitions – affects all debtors (i.e. not only entrepreneurs) and regardless of why and when the insolvency occurred.

3. Introducing an extraordinary moratorium: The Amendment establishes the rule that a debtor who is an entrepreneur and who has not been in bankruptcy at the date of March 12, 2020 can file a request for a so-called extraordinary moratorium by August 31, 2020. The effect of the moratorium is that: (i) the debtor cannot be declared insolvent for the duration of the moratorium, (ii) the debts required to maintain the debtor’s enterprise that arise after the extraordinary moratorium is introduced can be paid by the debtor during the moratorium preferentially, before previously due liabilities are met and (iii) the time limits for exercising rights against the debtor for the duration of the extraordinary moratorium neither commence nor continue to run. The debtor may file a motion for a moratorium order even before the filing of an insolvency petition and the commencement of the insolvency proceedings. In addition, unlike the current „normal“ moratorium, the proposal for an extraordinary moratorium does not need to be approved by the majority of the debtor’s creditors.

4. Suspension of performance of a reorganization plan: A debtor whose reorganization plan has been legitimately (finally) approved as of March 12, 2020 at the latest is entitled to propose to the insolvency court to state that the debtor is entitled to temporarily suspend performance of the reorganization plan (provided that the plan has not yet been fully fulfilled). The performance of the reorganization plan may be interrupted for the period of time during which the obligation of entrepreneurs to file debtor’s insolvency petitions is to be limited (see section 2 above). During the said period, it will not be possible to convert reorganization into bankruptcy (i.e. the liquidating way of the bankruptcy solution). However, the insolvency trustee and the creditor committee must comment on the debtor’s proposal to suspend the reorganization plan.

5. Discontinuation of time limits for relative ineffectiveness of legal acts: During the period of limitation of the obligation of entrepreneurs to file debtor’s insolvency petitions (see section 2 above), time limits for objections to relative ineffectiveness of legal acts should be suspended. By claiming ineffectiveness of a legal act, creditors can defend themselves within the statutory time limit against legal acts of the debtor that jeopardize the payment of their enforceable claim. When the measures described above provide special protection to the debtor, it is equally fair, during the period of such emergency measures, to discontinue the time limits for creditors within which they can defend themselves against the debtor’s prejudicing acts. Nevertheless, it is recommended that creditors should, even during the state of emergency, carefully monitor changes in the structure of their debtors‘ assets (e.g. in the land registry) so that they can effectively defend themselves against any prejudicing disposal of the debtor’s assets.

The Government proposes that the Amendment is to be discussed by both chambers of the Parliament of the Czech Republic in an abbreviated procedure. Therefore, it can be expected that the Amendment may be passed in a few days. However, before the described changes to insolvency law become effective, entrepreneurs still have the obligation (i) to perform the so-called insolvency test and (ii) to file a debtor’s insolvency petition without delay after the defined prerequisites of insolvency are met. Failure to comply with this obligation may have far-reaching consequences not only for the legal entity, but also for the members of its statutory body, consisting mainly in incurring liability for damage caused thereby.

We would like to assure you that we have extensive practical experience with insolvency law, from the point of creditors and debtors (and their statutory bodies). We also continuously monitor the current changes in Czech insolvency law. Please feel free to contact us if you have any questions regarding the above.

At the same time, we are ready to provide you with comprehensive legal advice on imminent or already existing bankruptcy situation (if any) and solutions thereto under insolvency law, including protection against personal liability of members of statutory bodies of legal entities. Such advice can be provided in connection with your (imminent) bankruptcy situation, but also in the case of bankruptcy of your contractual partners (either suppliers or customers). Should you decide to enforce your receivables in a different manner than by insolvency, we will be happy to propose the best solution for you and to provide you with comprehensive legal representation. If you are in danger of bankruptcy as a result of the crisis-related measures of the Government of the Czech Republic, we are ready to provide you with comprehensive legal advice regarding claiming damages towards the state. [2]

At the same time, insolvency can be an opportunity to expand your business activities, for example by buying a debtor’s enterprise. We also have considerable experience with insolvency acquisitions and, therefore, we can provide you with the necessary assistance in this regard.

[1] For out-of-court dispute resolution options at the time of the coronavirus epidemic, see the ŘANDA HAVEL LEGAL newsletter called „Impact of the COVID-19 Epidemic on Dispute Resolution“ that is available here: https://www.randalegal.com/download/files/newsletter_newsletter_praktickprvninformace_vii._engid244236.pdf.

[2] For the possibility of claiming compensation from the State for crisis measures, see the ŘANDA HAVEL LEGAL newsletter on „Recent Developments in the Matter of State Liability for Damage in Connection with Measures in Crisis“ that is available here: https://www.randalegal.com/download/files/newsletter_newseletter_praktickprvninformace_viii.engid244494.pdf.

Temporary Emergency Bridging Measure to Preserve Employment: the conditions

Posted on by Annette Knijnenberg

The coronavirus has the Netherlands and the rest of the world in its grip and is seriously impacting the economy, among other things. Bars and restaurants have closed, shopping streets are empty and businesses are seeing an enormous drop in their sales. The Dutch government has announced several measures to alleviate these economic consequences. One of those measures is the Tijdelijke Noodmaatregel Overbrugging(NOW)(Temporary Emergency Bridging Measure to Preserve Employment). This scheme had been announced earlier, but the conditions for reliance on the scheme were made public on Tuesday, 31 March. We will address the main aspects of the scheme in this blog.

1. What are the conditions and how high is the contribution?
Employers may rely on the NOW in the event of a drop in turnover of at least 20% in a consecutive period of three calendar months between 1 March and 31 May 2020. The other condition is that an employer may not file a redundancy application on economic grounds with the UWV (Employee Insurance Agency) between 18 March and 31 May 2020. The contribution amounts to 90% of the payroll total in the event of a 100% drop in turnover. The actual contribution depends on the exact scope of the drop in turnover.

The application for the contribution first consists of an application for an advance of 80% of the expected contribution. That amount is then paid in three instalments. It is not yet necessary to submit an accountant’s statement when applying for the advance. When the final contribution is applied for, which must be done within 24 weeks after the compensation period, that accountant’s statement must be enclosed, however. An exception applies if the contribution does not exceed a threshold yet to be determined.

2. How is the loss of turnover calculated?
The turnover is determined on the basis of a three-month period. The employer may at its option have the reference period for the turnover comparison commence on 1 March, 1 April or 1 May 2020. The turnover generated in the selected three-month period must then be compared with the average turnover in 2019 (divided by four). An employer must apply for the contribution per withholding tax number.

The turnover is determined at group level. A group of companies may therefore not state the expected drop in turnover per entity. The turnover of the group or of the affiliated legal entities is therefore decisive in determining whether the NOW may be relied on.

3. Is the entire salary taken into account in calculating the compensation?
The contribution amounts to a maximum of 90% of the payroll total for the three-month period from March to May 2020. The payroll total is based on the wage for social insurance purposes from current employment. Additional charges and costs, such as employer’s social security contributions and employee contributions to pension and the accrual of holiday allowance are compensated. To accelerate the application procedure, a 30% surcharge for employer’s social security contributions has been opted for in all cases. No more than twice the maximum daily wage per month per individual employee is classified as wages. Wages in excess of €9538 per month are therefore not eligible for compensation.

4. What are the consequences if I nevertheless dismiss employees on economic grounds?
As described above, one of the conditions for relying on the NOW is that an employer may not file a redundancy application with the UWV between 18 March and 31 May 2020 on economic grounds. If an employer does so nevertheless, the UWV will handle that application in the regular manner. Depending on the outcome of the application, that will, however, have consequences for the amount of the contribution. The salaries of the employees for whom the redundancy application is filed are increased by 50% and are deducted from the payroll total on the basis of which the amount of the contribution is determined.

5. Will the scheme be extended and what conditions will then apply?
The possibility of extending the bridging measure has been kept open. That question will be decided on before 1 June 2020; the extension period will therefore immediately follow the first application period, which ends on 31 May 2020.

6. As from what date may NOW applications be filed?
The government aims to open the service desk for the applications on Monday, 6 April 2020. It will be determined on Friday, 3 April, whether that is feasible. The service desk will in any event be open by Tuesday, 14 April 2020 at the latest. Once the service desk has been opened, applications may be filed via the UWV’s website. That may be done without the use of eHerkenning or any other form of authentication or authorisation. The application must have been filed by 31 May 2020 at the latest. The UWV has announced that it aims to pay the first advances within three or four weeks after an application is filed.

7. Are variations possible for specific sectors or companies?
No. The scheme does not allow for sectoral or company-specific variations. Seasonal influences on the turnover are also not taken into account. The scheme is therefore not a solution for all companies.

If you have any further questions about the Temporary Emergency Bridging Measure to Preserve Employment, please contact one of our employment lawyers at tel. no. 020-664 5111. We will be pleased to help you.

Compensation Package for Employers adopted by the Government of the Czech Republic

Posted on by Gabriela Fuchsová

Government of the Czech Republic yesterday (i.e. on 31 March 2020) adopted the new modified Compensation package for employers (“Antivirus Programme”) which we have previously reported. For the sake of clarity, the Government has combined the previously published compensatory measures into two (2) compensatory measures, i.e. regimes A and B listed below.

Under the A regime the state will provide employers with a contribution in the amount of 80% of the wage compensation provided to an employee, including social and health insurance contributions, if the reason for the obstacle to work is

• on the employee’s side “Quarantine ordered to an employee” (an obstacle under Section 191 of the Labour Code), whereas the amount of wage compensation provided by the employer is 60% of the employee’s average assessment base; or
• on the employer’s side “Inability to assign work due to enterprise closure as a result of adopted emergency measures” (an obstacle under Section 208 of the Labour Code), whereas the amount of wage compensation provided by the employer to is 100% of the employee’s average earnings.

The maximum amount of the contribution is derived from the current average supergross wage including social and health insurance contributions, and in this case amounts to approximately CZK 39,000.

Under the B regime the state will provide employers with a contribution in the amount of 60% of the wage compensation provided to an employee, including social and health insurance contributions, if the reason for the obstacle to work is on the employer’s side

• “Childcare or Quarantine Ordered to a significant part of employees, i.e. at least to 30% of employees” (an obstacle under Section 208 of the Labour Code), whereas the amount of wage compensation provided by the employer is 100% of the employee’s average earnings; or
• “Limitation of the availability of inputs, i.e. material, products and services which are necessary for its activities” (an obstacle under Section 207 of the Labour Code), whereof the amount of wage compensation provided by the employer is 80% of the employee’s average earnings; or
• “Reduced demand for services, articles and other products of the company” (an obstacle under Section 209 of the Labour Code), whereas the amount of wage compensation provided by the employer is at least 60% of the employee’s average earnings.

The maximum amount of the contribution in this case is approximately CZK 29,000.

The conditions for obtaining the above contributions are as follows:

• the employer operates in the business sphere;
• the employer strictly complies with the Labour Code;
• the employees are in an employment relationship and participate in sickness and pension insurance;
• the employees have not been served with a termination notice and are not in the notice period as of the accounting date (with the exception of termination pursuant to Section 52 (g) and (h) of the Labour Code); and
• the employer pays the wages and social and health insurance contributions.

For the sake of completeness, we add that the contributions will also apply to agency workers, provided that the employment relationship with the employment agency was entered into before the day of the declaration of a state of emergency (i.e. 12 March 2020) and lasts for the entire duration of the Antivirus Programme.

The above contributions shall be provided to employers on the basis of an agreement concluded with the respective Labour Office of the Czech Republic retroactively. Employers shall be entitled to submit their applications for the contributions for March from 6 April 2020 (the expected launch date of the web application). All necessary operations between the employer and the labour office will be carried out remotely in electronic form.

If you have any questions regarding the state compensation in the area of employment or regarding other measures that an employer can use in the current difficult situation, please do not hesitate to contact us. More specifically, please contact our attorney-at-law, Lenka Droscová, who specialises in labour law.

Government measures in the Netherlands – update 31 March

Posted on by Annette Knijnenberg

The Dutch government has taken extensive measures to help businesses affected by the corona crisis.

The measures now in place are:

•  The new temporary measure Temporary Emergency Bridging Measure for Sustained Employment (NOW, Noodfonds Overbrugging voor behoud van Werkgelegenheid) will provide financial help for employers to help pay their employees‘ wages. The unemployment benefit during short-time working scheme has been cancelled. You can apply for the NOW scheme from Monday 6 April through 31 May 2020.

•  From 16 March 2020 to 1 April 2021, the SME credit guarantee (BMKB) scheme will be extended to help SMEs that are affected by the coronavirus secure bank guarantees and bridge financing. The extended scheme is referred to as BMKB-C.

•  For agricultural entrepreneurs, the equivalent of the BMKB-C is the Credit Guarantee scheme for Agriculture (BL-C).

•  The Business loan guarantee scheme (GO) has been extended.

•  Self-employed professionals will be able to apply for an extra, temporary benefit for self-employed professionals (Tozo) to bridge the loss of income from 1 March onwards, in the municipality where they live

•  Entrepreneurs who have a loan from microcredit provider Qredits do not have to repay their loan for a period of 6 months. During this period, the interest will be reduced to 2%. The government supports Qredits with 6 million euros.

•  The €4,000 Compensation for entrepreneurs in affected sectors scheme (TOGS) is now open for entrepreneurs in a number of specific sectors who have been affected by the coronavirus measures. You can apply to the Netherlands Enterprise Agency (in Dutch). To find out if your business is eligible for the compensation, check the SBI code list (in Dutch). At the bottom of the page, there is a search tool (Zoektool SBI-codes) where you can enter your KVK number to find out your SBI code.

•   The Incentive scheme eHealth at Home (SET). has been extended to make it easier for healthcare organisations that want to offer their clients eHealth solutions (such as video calls) to invest in apps, software or hardware.
N.B.: As of 27 March, this subsidy is temporarily unavailable due to the unexpectedly large number of applications.

•   The government will extend the export credit insurance facility. It will be possible for companies to get a short-term guarantee with a runtime of less than 2 years. Also, other conditions are being extended. Read the news article on Rijksoverheid.nl (in Dutch).

•   The Dutch Trade and Investment Fund (DTIF) will be extended to include pre-delivery advances.

Tax options for entrepreneurs

•   You can apply for a payment extension of 3 months for all your income tax, corporate tax, payroll tax, and turnover tax (VAT) assessements at once, by filling out a special online form (in Dutch). You need a DigiD for this, but if you don’t have one, you can ask an employee or a financial advisor to login for you, using their DigiD. You will need to fill out your RSIN number or your citizen service number (BSN), so keep these ready. The Dutch Tax Administration will put on hold any measures in place to collect payment immediately upon reception of your request.

•   You can now also apply for payment extension of several other taxes and duties: excise duty, landlord levy, environmental taxes, insurance premium tax and betting and lottery tax.

•   You will not have to pay any fines for late payment.

•  The normal collection interest rate for paying after the payment term has passed has been decreased temporarily to nearly 0%. This applies to all tax debts. The tax interest rate will also temporarily be set to the lowest possible percentage for all entrepreneurs.

•   The obligation for employers under the new Balance Employment Market Act, to report permanent employees‘ employment contracts before 1 April 2020, has been extended to 1 July 2020.

•   Under certain circumstances, you can apply for unblocking of your G-account. Read the conditions and find the form (in Dutch, under ‚Deblokkeren g-rekening‘).

Read more about the Dutch Tax Administration measures to help entrepreneurs (in Dutch only).

Travel restrictions

As of 19 March, there are travel restrictions in place for travel into the Netherlands. The restrictions apply to all non-EEA travellers without valid residence permits or visa, and will be in place for at least 30 days. Read the article on The Netherlands and you for full details on who is and who is not allowed to travel into the Netherlands.

Apply for a reduction of your provisionary assessment

Do you expect lower profits due to the coronavirus, and are you currently paying a provisionary assessment for income tax or corporate income tax? You can change your provisionary assessment. If you want to change your income tax provisionary assessment, go to the online portal for individuals: MijnBelastingdienst (in Dutch); to change a corporate tax provisionary assessment go to the business portal: MijnBelastingdienst Zakelijk (in Dutch).

Regional Water Authority tax

Are you unable to pay the water authority tax in time? Most Regional Water Authorities allow you to apply for a temporary extension of payment. It has also been made easier to apply for a payment arrangement. See the article on Regional Water Authority tax for more information.

General measures to protect the public health

•  All public events and meetings are cancelled until 1 June.

•  All public places, like museums, concert halls, theatres, bars, restaurants, coffee shops, and sports clubs, are closed until 28 April.

•  Personal care professionals, who cannot keep 6 feet distance from their clients, cannot execute their profession until 28 April.

•  Shops that cannot guarantee their clients and staff that they can keep 6 feet distance from each other, are closed until 28 April.

•  Schools and universities are closed, at least until the May vacation.

•  People in so-called ‘vital professions’ may still go to work. Special arrangements are made for the schooling and daycare needs of the children of people in so-called ‘crucial professions’ (in Dutch). Contact your municipality or safety region for information, or check the RIVM and Rijksoverheid pages.

For any questions on above measures, please contact Elias van Kampen at elias.vankampen@actlegal-fort.com or +31 (0)20 664 5111

Employees’ personal health data collection: operational tips

Posted on by Stefano Balzola

The COVID-19 health emergency involves some issues related to the protection that the employer must offer in case of employees’ personal health data collection. The assessment and collection of information relating to the symptoms of COVID-19 (as well as that relating to recent movements of people) must be carried out by healthcare professionals and the civil defense system, which are the entities tasked with ensuring compliance with recently adopted public health rules.

For this reason, the Italian DPA clarified, on March 2end 2020, that “the employers must refrain from collecting, in advance and in a systematic and generalized manner, including through specific requests to the individual worker or unauthorized investigations, information on the presence of any signs of flu in the worker and his or her closest contacts, or anyhow regarding areas outside the work environment”.

On the other hand, the Government and the representatives of Trade Unions signed a Protocol on 14 March 2020 providing measures to contain and mitigate the COVID-19. The Protocol contains several provisions which among the other things, allows the employer to process the collection of employees‘ personal data in order to protect public health.

In this sense, according to art. 2 of the aforesaid Protocol, the employer could restrict the access to personnel whose body temperature is above 37.5°C.

In order to verify this parameter, the provision allows to measure employees’ temperature at the entrance of the workplace, as long as the rules about personal data protection are complied with.

The employer should collect, in real time, the temperature and all data relating to employees’ health, according to art. 9 of the GDPR.

The GDPR  foresees derogations to the prohibition of processing of certain special categories of personal data, such as health data, where it’s necessary for reasons of substantial public interest in the area of public health (Art. 9.2.i), on the basis of Union or national law, or where there is the need to protect the vital interests of the data subject (Art.9.2.c).

For this reasons, in order to provide some operational tips, we suggest to:

  1. measure the temperature but don’t register the collected data. It’s useful to identify the person and record the temperature only when it’s necessary to document the reasons that didn’t allow the employee’s access to the workplace;
  2. provide policy on the processing of personal data. As regards the contents of the privacy policy, with reference to the purpose of the processing, the prevention of contagion from COVID-19 may be indicated and with reference to the legal basis, the implementation of the anti-infection security protocols pursuant to Art. 1, no. 7, letter d) Prime Minister’s Decree dated 11 March 2020; furthermore, with reference to the data retention period, it can be indicated until to the end of the state of emergency;
  3. define the appropriate security and organizational measures to protect the data. Controllers and processors shall give the necessary instructions to person acting under their authority who has access to personal data. Moreover, please note that the data may be processed exclusively for purposes of prevention from infection by COVID-19 and must not be disclosed or communicated to third parties, except in the cases provided for by specific  provisions (such as the request by the Health Authority aimed at the reconstruction of the chain of any „close contacts“ of a worker found positive to COVID-19); we recommend, in any case, to review the company’s policy on data protection;
  4. ensure arrangements to guarantee the confidentiality and dignity of the worker. These guarantees must also be ensured in the event that the employee informs the HR manager that he or she has had, outside the company context, contact with people who have tested positive for COVID-19 and in the event of removal of the worker who develops symptoms of respiratory infection during his or her work activity.

In the event that the employer intends to request the worker to issue a self-certification attesting that, in the previous 14 days, the worker has not had any contact with people tested positive for COVID-19 or does not come from areas considered at risk, it must be considered that the acquisition of such information constitutes personal data processing, with consequent application of the protection measures indicated above. In any case, it should be considered that the employer is required to inform  their staff in advance – also by means of information signs – of the prohibition of access to those who, in the previous 14 days, have got contact with individuals who have tested positive for COVID-19 or who come from risk areas, as indicated by the WHO.

Price capping and ongoing agreements in the context of Coronavirus Pandemic

Posted on by Ana Pandelea

What’s new? Capped prices for electricity and heat, gas, water, sanitation and fuels from 29 March 2020 until the end of the state of emergency. The capping means in this case that the prices cannot increase above the level existing on 29 March 2020, but they can decrease according to supply and demand. This measure was taken through Military Ordinance no. 4/2020. </p>

Who’s affected? The Ordinance does not differentiate with regard to whom the capping measures will apply, meaning that all prices are capped. Therefore, the measure may be applied to producers, distributors, suppliers and end customers. This leads to a certain degree of confusion, since prices in energy are mostly formed on centralized markets such as the Day-Ahead Market (PZU), OPCOM, commodity exchanges, etc.

Which price will be applied? There are inconsistencies between the price caps established under Decree No. 195/2020 and the Military Ordinance. The possibility of price capping for certain goods and/or services was first introduced through presidential Decree No. 195/2020 for declaring the state of emergency in Romania on 16 March 2020. The decree considers the average prices for the three months prior to 16 March 2020. The price capping under the Military Ordinance considers the price levels applicable on the day of the Ordinance – 29 March 2020.

What’s next? The provisions of the Military Ordinance are very likely to give rise to uncertainty and debate with respect to the capping of the prices, since they stray from the provisions of the Presidential Decree for declaring state of emergency.

Urgent and extraordinary measures to support the most vulnerable tenants affected by COVID-19

Posted on by Jessica Zenz-Spitzweg

Royal Decree-Law 11/2020, of 31 March, which takes additional urgent measures in the social and economic sphere to deal with COVID-19.

The measures aim to minimize the impact of this situation and to protect tenants who remain vulnerable, but also to articulate those actions necessary so that landlords, also sometimes in difficult circumstances, can also overcome the impact of this crisis.

More relevant measures

(1) Suspension of eviction procedure and releases affecting housing leases, in situations of vulnerability without housing alternative. In eviction procedures affecting the usual dwelling, launches without a housing alternative will be suspended for a period of up to six months.

In the event that the lessor concerned is also subject to vulnerability, it will be the Judge who determines the period of suspension or the measures to be established, taking into account the report issued by the competent social services.

(2) Six-month extension on leases ending in this period, at the request of the tenant. In those housing leases in which their validity (or extensions) ends within the period from the entry into force of this royal decree-law and until the day on which two months have elapsed since the end of the alarm status, an extension period of up to six months is established.

This extension shall be mandatory for the landlord if requested by the lessee, under the same conditions set out in the current contract, unless an agreement has been reached on this matter between the landlord and tenant.

(3) State-guaranteed line of guarantees, which will allow to cover the payment of up to six months of rent, for any tenant who is in a situation of vulnerability as a result of COVID-19.

A Transitional Funding Aid Programme is created for all households that may be affected in their income by the expansion of COVID-19, so that, through an agreement with the Official Credit Institute (ICO), these households are offered the possibility of covering rent payments for a period of up to six months, without any expenses or interest for the applicant, and can be returned within six years.

(4) In situations of vulnerability, where the lessor is a public entity or a large holder, 50% reduction in income, or moratorium of up to four months in the payment of rent.

In the event that the tenant is affected by situations of vulnerability arising from the expansion of COVID-19, and the lessor is a public entity or a large holder (natural or legal person holding more than 10 urban properties, excluding garages and storage rooms, or more than 1,500 m2 of constructed area), and in the absence of an agreement between tenant and owner, it is established that for the period that such vulnerability persists, the owner may grant during that period, and with a maximum of four months, a 50% reduction in rent, or a moratorium on the payment of rent during that period to be repaid for up to three years.

This moratorium would be suspended if the tenant agreed to the financial aid explained in the previous point.

(5) Additionally 100 million euros are provided for the State Housing Plan 2018-2021. A new aid Program is implemented that will allow the granting of direct rental aid to regular housing tenants who, as a result of the economic and social impact of COVID-19, have serious problems in meeting the partial or total payment of rent.

The management of the Plan is relaxed and streamlined, in order to provide direct coverage to the vulnerable tenant for the payment of the rent or for the payment of the financing through the Official Credit Institute (ICO) subscribed by the tenant with which the rent will have been satisfied.

The document verification process and requirements for access to the State Housing Plan’s rental assistance programs speed up. Taking into account the exceptionality of the situation, the requirements to be met by beneficiaries of any rental aid financed under the State Housing Plan 2018-2021, including those of the aid program to help minimize the economic and social impact of COVID-19 on regular housing rentals, may be verified by the Autonomous Communities after the resolution of granting the aid, which is conditional on the fulfilment of the requirements.