Hungary

Since the beginning of the pandemic, the Commission has adopted support measures under the state aid Temporary Framework and EU state aid rules. These measures aim to help citizens and companies and mitigate the significant economic impact of the coronavirus pandemic:

• on 17 May 2021, the Commission confirmed the modification of the aid scheme for the protection of the economy (case SA.59477, subsequently amended by cases SA.60367, SA.61329, SA.61842 and SA.62268) to be in line with EU state aid rules, approving additional support of €63.2 million. Under the state aid Temporary Framework, the modification allows for the introduction of a new measure to the existing scheme, aiming at supporting self-employed individuals severely affected by the coronavirus outbreak. This measure will provide a direct grant equal to the Hungarian minimum wage and will cover a period of three months (May to July 2021).

• on 16 April 2021, the Commission approved a €50 million ‘umbrella’ scheme to support Hungarian companies in the context of the coronavirus outbreak. Under the state aid Temporary Framework, the support, in the form of direct grants as well as aid for the uncovered fixed costs of companies that suffered a decline in turnover. The scheme is open to companies of all sizes active in all sectors except the financial one and covers the entire territory of Hungary. The aim of the scheme is to help the beneficiaries to address their liquidity needs and continue their activity during and after the outbreak.

• on 29 March 2021, the Commission approved modifications to three existing Hungarian schemes (SA.57269, SA.58420, SA.57064), to support companies affected by the coronavirus outbreak. In line with the EU state aid rules, the modifications include limited budget increases and a deadline extension for aid application submissions.

• on 18 February 2021, themodification of 12 Hungarian aid schemes to support companies affected by the coronavirus outbreak to be in line with the EU state aid rules. The existing schemes, approved by the Commission under the state aid Temporary Framework in 2020, were extended until end of 2021, with budgetary increases and other technical amendments.

• on 1 February 2021, a Hungarian scheme worth around €478 million to support small and medium-sized enterprises affected by the coronavirus outbreak. Under the state aid Temporary Framework, the public support, in the form of a reduction of the local business tax rate and a reduction in the advance payments of the local business tax, aims to provide relief and liquidity to small and medium-sized enterprises to mitigate the effects of the coronavirus outbreak.

• on 10 December 2020, approved a €132.5 million Hungarian aid scheme to support the catering, culture, sports and accommodation sectors, which have been affected by the coronavirus outbreak. Under the state aid Temporary Framework, the scheme aims to alleviate employer's costs and avoid lay-offs, as well as to mitigate the liquidity shortages the beneficiaries are facing, and ensure the continuity of  economic activity during and after the outbreak. The public support for the catering, culture and sports sectors is granted as wage subsidies, consisting of exemptions from fiscal obligations born by the employers, and direct grants amounting to 50% of the employees' gross salary. On 29 March 2021, scheme was modified to extend the scope of beneficiaries and increase the budget.

• on 23 November 2020, a €145 million Hungarian scheme to provide liquidity and capital support to companies affected by the coronavirus outbreak. Under the state aid Temporary Framework, the support is to take the form of subordinated loans, recapitalisations and convertible loans. The scheme is managed by two state funds, and recapitalisation is a mandatory component of aid, possible to combine with debt and/or other instruments.

• on 10 November 2020, the modifications of several existing Hungarian State aid schemes, to support the national economy in the context of the coronavirus outbreak. The modifications approved by the Commission entailed duration extensions and supplemented budgets.

• on 1 October 2020, under the State Aid Temporary Framework, an extension of a Hungarian aid scheme to support research and development (R&D) and investments into the production of products that are relevant to the coronavirus outbreak, approved on 10 August 2020. This extension makes available an additional budget of around €100 million (HUF 35 billion) that will be co-financed by the European Structural and Investment Funds, for a total budget of around €243 million (HUF 85 billion) including the initial scheme. The extended measure will be open to all companies, while under the initial scheme only enterprises with more than 9 and less than 5000 workers are eligible. The aim of the extended scheme is to further enhance and accelerate the development and the production of products directly relevant to the coronavirus outbreak, including vaccines, hospital and medical equipment and medicinal products, as well as the development of innovative processes for an efficient production of such products. The public support will take the form of direct grants that may cover a significant share of the necessary R&D and investment costs.

• on 13 August 2020, under EU State aid rules, in particular the Temporary Framework, the modification of a previously approved Hungarian scheme to support the Hungarian economy in the context of the coronavirus outbreak.  The existing scheme was approved on 20 May 2020 under case number SA.57285 and amended on 28 July 2020 under case number SA.58065. Hungary notified the following main modifications to this scheme: (i) the extension of the measure to an additional loan programme called the “Széchenyi Tourism Card”, that will be accessible to small and medium-sized enterprises (SMEs) active mainly in the tourism sector and will take the form of an overdraft facility; and (ii) an increase in the total budget of the scheme, from HUF 21 billion (approximately €60 million) to HUF 34 billion (approximately €100 million). It is estimated that in total up to 10,000 companies will benefit from the amended scheme.

• on 11 August 2020, a HUF 50 billion (approximately €143 million) Hungarian aid scheme to support investments in research and development (R&D) and production of products relevant to the coronavirus outbreak. The public support, which will be open to all companies that are able to engage in the research and development and/or production of the relevant products irrespective of their sector of activity, will take the form of direct grants. The aim of the scheme is to enhance and accelerate the development and the production of coronavirus-relevant products, including vaccines, hospital and medical equipment, medicines, and the development of innovative processes for their efficient production.

• on 8 July 2020, a HUF 8 billion (approximately €23.5 million) Hungarian wage subsidy scheme to support the aviation sector, which has been heavily affected by the coronavirus outbreak. The public support will take the form of exemptions (amounting to up to 23% of the monthly gross salary paid to the employees) from the employers' obligation to pay social security, vocational training and rehabilitation contributions. The scheme will be open to employers that are active in the manufacturing of air and spacecraft machinery, repair and maintenance of aircraft and spacecraft, and air passenger transport, provided that they have experienced a significant reduction in their business activities due to the coronavirus outbreak in the period of April and May 2020. The scheme aims at alleviating the employers' costs and avoiding lay-offs and at helping to ensure that employees can remain in continuous employment during the period for which the aid is granted.

• on 23 June 2020, under EU State aid rules, a HUF 50bn (approximately €145 million) Hungarian scheme to compensate large companies for the damages suffered due to the coronavirus outbreak and the confinement measures that the Hungarian government had to implement to limit the spread of the virus. Under the scheme, companies will be entitled to compensation of the damages incurred in the form of direct grants. The compensation will cover up to 100% of the difference between the operating results of the company concerned during the compensation period and its operating results in a reference period before the coronavirus outbreak. The support will be accessible to large companies active in all sectors with the exception of companies active in the primary agriculture sector and in the fisheries and aquaculture sectors. It is estimated that approximately 50 to 100 enterprises will benefit from the support. The Commission found that the Hungarian scheme is in line with Article 107(2)(b) of the Treaty on the Functioning of the European Union (TFEU), which enables the Commission to approve State aid measures granted by Member States to compensate specific companies or specific sectors for the damages directly caused by exceptional occurrences, such as the coronavirus outbreak.

• on 22 June 2020, the modification of a previously approved Hungarian scheme to support the Hungarian economy in the context of the coronavirus outbreak to be in line with EU State aid rules, in particular with the State aid Temporary Framework. The existing scheme was approved on 20 May 2020 under case number SA.57269. Hungary notified the following modifications to this scheme: (i) an increase in the estimated total budget of the scheme, from HUF 57 billion (approximately €156 million) to HUF 103 billion (approximately €288.3 million); and (ii) the extension of the initial scheme to new capital funds (“Hiventures” and “Crisis Funds”). It is estimated that between 240 and 420 companies will benefit from the modification of the existing scheme.

• on 9 June 2020, a HUF 54 billion (approximately €155 million) “umbrella” scheme to support companies affected by the coronavirus outbreak. The measure will allow the Hungarian authorities to grant aid under certain existing schemes in the form of direct grants to cover investments by companies aiming at preserving jobs or creating new job opportunities. The aim of the “umbrella” scheme is to help companies address the liquidity shortages they are facing as a result of the coronavirus outbreak.

• on 25 May 2020, a Hungarian scheme, with an estimated budget of HUF 57 billion (approximately €156 million), to support the Hungarian economy in the context of the coronavirus outbreak. The support will take the form of equity injections and convertible loans (i.e. loans that can be converted into equity) of up to €800,000. The scheme will be open to companies active in all sectors, with some exceptions defined by Hungary, namely companies active in the agricultural, fishery and aquaculture sectors. It is estimated that between 140 and 220 companies will benefit from the support. The purpose of the scheme is to address the liquidity needs of companies affected by the current crisis and to help them to continue their activities, start investments and maintain employment during and after the outbreak.

• on 25 May 2020, an approximately €60 million (HUF 21 billion) Hungarian scheme to support micro, small and medium sized enterprises (“SMEs”) affected by the coronavirus outbreak. The aim of the measure is to ensure that micro companies and SMEs affected by the coronavirus outbreak have sufficient liquidity to cover their immediate working capital and investment needs by facilitating access to loans. The support will take the form of direct grants intended to cover part of the financial costs (interests and handling fees) incurred by micro companied and SMEs in relation to certain loans granted until 31 December 2020. The aid will be channelled through credit institutions. The Hungarian authorities expect that up to 6,000 micro companies and SMEs will be able to benefit from the scheme.

• an approximately €99 million (HUF 35 000 million) scheme to support the Hungarian agri-food, fisheries and aquaculture, forestry and game management (hunting) sectors in the context of the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020 and 8 May 2020. The support will take the form of grants and will be accessible to companies of all sizes active in these sectors. The purpose of the scheme is to address the liquidity needs of these companies, and to help them to continue their activities during and after the outbreak. It is estimated that more than 15,000 enterprises will benefit from this support. The Commission found that the Hungarian scheme is in line with the conditions set out in the Temporary Framework. In particular, aid does not exceed €120,000 per company active in the fishery and aquaculture sector and €100,000 per company active in the primary production of agricultural products.

• on 7 May 2020, a Hungarian scheme to support the agri-food value chain in the context of the coronavirus outbreak, which is expected to mobilise at least approximately €314 million (approx. HUF 111 billion). The scheme will be open to small and medium-sized enterprises (SMEs) active in all sectors, but is aimed at the wider agri-food value chain. The objective of the measure is to provide those companies with financial means to cover their immediate working capital and investment needs, and help them maintain their activities during these difficult times.

• three Hungarian aid measures, with a total budget of around € 900 million, to support the Hungarian economy in the context of the coronavirus outbreak. The schemes were approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020. Under the three schemes, , with a total budget of around € 900 million, the public support will take the form of (i) direct grants, (ii) guarantees on loans, and (iii) subsidised interest rates for loans, respectively. The measures, which will be open to small and medium-sized enterprises (SMEs) and large companies facing economic difficulties and liquidity shortages due to the coronavirus outbreak. The schemes are expected to benefit up to 5,000 businesses. The schemes aim at providing businesses which are particularly affected by the coronavirus outbreak with sufficient liquidity to cover their immediate working capital and investment needs, thus enabling them to continue their activities, make investments and maintain employment during and after the outbreak.

• a €1.55 billion (approximately HUF 550 billion) Hungarian aid scheme to support the Hungarian economy in the context of the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020. The scheme consists of two complementary measures that will be managed and implemented by two separate entities: (i) The semi State-owned Garantiqa Credit Guarantee Company Ltd. will provide guarantees on loans up to a maximum of €14 million (approximately HUF 5 billion) per company; (ii) The State-owned MFB Ltd. (Hungarian Development Bank) will provide guarantees for loans in excess of that amount up to a maximum of €28 million (approximately HUF 10 billion) per company. Under the scheme, the public support provided by Garantiqa will take the form of State guarantees on new and existing investment and working capital loans. The support provided by the Hungarian Development Bank will take the form of State guarantees on new investment and working capital loans. The guarantees will be channelled through credit institutions. The scheme will be open to micro, small and medium-sized enterprises (SMEs) and large companies.

• a HUF 31.5 billion (approximately €88 million) Hungarian wage subsidies support scheme for researchers and developers active in all sectors affected by the coronavirus outbreak. The measure is accessible to companies of all sizes and especially to those that are research and innovation intensive. The Commission found that the scheme notified by Hungary is in line with the conditions set out in the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020. In particular, (i)the measure will compensate the wage costs for employees who qualify as researchers and developers and is limited to undertakings which would otherwise lay off personnel due to the coronavirus outbreak, (ii) the aid intensity complies with the maximum 80% allowed by the Temporary Framework, and (iii) the aid scheme respects the maximum duration of twelve months.

• on 17 April 2020, a HUF 350 billion (approximately €1 billion) scheme to support the Hungarian economy in the context of the coronavirus outbreak. Support will be in the form of direct grants, loans and equity measures, using EU structural funds for that purpose. The scheme will be open to all companies, i.e. micro, small and medium-sized enterprises (SMEs) and large companies, which have access to European structural funds and are facing difficulties as a result of the economic impact of the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework adopted by the Commission on 19 March 2020, as amended on 3 April 2020.

• on 8 April 2020, a Hungarian aid scheme to support the Hungarian economy in the context of the coronavirus outbreak. The scheme is to support businesses affected by the coronavirus outbreak, and will be managed by the competent agency, Hungarian Investment Promotion Agency NonProfit Ltd (HIPA Non-Profit Ltd). The public support, which will take the form of direct grants, will be accessible to medium and large enterprises, which are particularly hit by the economic consequences of the coronavirus outbreak and which are active in certain sectors defined by Hungary. The scheme aims at supporting companies that face difficulties due to loss of income and liquidity resulting from the economic impact of the coronavirus outbreak. In particular, it will help businesses to cover their immediate working capital or investment needs.