According to the COFAG representatives, the Ministry of Finance with COFAG assistance and the EU Commission are working intensively on it. Briefly explained, it is about the fact that Austria allows individual companies to be subsidized by the state (or had them). However, the EU wants to promote business associations. Individual companies from corporate groups in Austria could now be threatened with repayments if Vienna and Brussels fail to reach an agreement. COFAG is currently checking.
According to the directive, individual companies are entitled to apply in Austria. However, the EU Commission provides subsidies at the level of the group of companies as an economic unit – and not the individual company that may be part of a group of companies, which is favored according to domestic guidelines. In connection with this, it is now a question of the amount of economic aid granted from spring 2020 (until the end of September 2022). According to APA information, the EU Commission contacted the Republic in the course of 2022.
If the Commission and the Ministry of Finance (BMF) do not agree, some companies would have to repay state aid – but the Republic still wants to do this in the interests of the companies. Potentially, the sums could be higher, because several companies from corporate groups are involved. When asked, the COFAG bosses did not want to name any sums.
Specifically, in connection with the granting of grants such as lockdown sales compensation, “fixed cost subsidy 800,000”, cancellation bonus and loss compensation, Republic had not checked whether the beneficiary companies form an economic unit (group of companies) with subsidiaries or sister companies and thus the maximum amount of 2, 3 or twelve million euros (for loss compensation) was exceeded. The COFAG bosses spoke to the APA of “not a simple legal question that needs to be clarified properly. Everyone is working flat out on it,” said Schimpel.
COFAG is now examining certain companies that have applied for funding to see whether they could be companies from a group of companies. If there was state aid, it is checked whether this was exceeded. “We are trying to do this as quickly as possible,” says Schimpel. COFAG itself has adhered to national guidelines for payment. If necessary, repayments could be threatened. Until then, however, one hopes that the EU Commission and the Ministry of Finance will have reached an agreement, according to the COFAG managing directors.
After the pandemic measures were already in progress or completed, the European Commission approached the Republic of Austria with the position that, with regard to the maximum amounts under state aid, the level of the group of companies should be examined as an economic unit (and not the individual company benefiting from the guidelines). was, COFAG had already announced in the morning. This question must be clarified by the Federal Ministry of Finance and the Commission. “They are trying to get closer,” said Zafoschnig.
Responsible is the Ministry of Finance of Magnus Brunner (ÖVP). His predecessor as Minister of Finance and ex-ÖVP Vienna boss Gernot Blümel was responsible for the directive. In the beginning of the corona crisis, he always emphasized how important it was to help quickly. In Austria, however, since the beginning of the corona subsidies and further on the aid after the energy price explosion and inflation wave, critics have always addressed “overfunding”. Economic researchers are also partly of this opinion, at least the “watering can” is very often criticized.
“The government’s Corona economic aid and the processing of the aid payments via COFAG were wrong from the start,” criticized SPÖ business spokesman Christoph Matznetter in a broadcast. “However, the government was never ready to stop this disaster.” The Social Democrats have always warned against “unjustified payments and overfunding”, as they are now in the room. They are certain that there has been “a systematic overfunding of individual corporations”.
“The current developments show once again what we warned about from the start,” said NEOS in the person of budget and finance spokeswoman Karin Doppelbauer. “Namely, that COFAG is a completely opaque and outrageously expensive misconstruction by the turquoise-green federal government, in which the guidelines were designed in such a way that many benefited massively, while others got nothing.” The victims are not only the taxpayers, who have to repay the multi-billion dollar gifts, “but also the companies that believed the beautiful words of the ÖVP finance ministers and are now confronted with massive legal uncertainty”.
