COVID-19, measures adopted to support enterprises: DL 28.2.2020, DPCM 1.3.2020

Prepared by Flavio Mondello Malvestiti

As announced in the Newsalert of February 27, 2020, the Government has launched further measures to support businesses and citizens negatively impacted by the COVID-19 epidemiological emergency. In 2019, economic activities in the regions of Lombardy, Veneto and Emilia-Romagna contributed to 52% of total GDP. Addressing this emergency means mitigating the potentially highly negative impact on economic growth.

In the EU Commission’s winter estimates, Italy’s GDP was estimated to grow by 0.3% in 2020. As a result of COVID-19,in the first quarter of 2020, GDP could shrink again, sending Italy into a technical recession.

On February 28, 2020, the Council of Ministers approved a decree-law introducing urgent measures aimed at ensuring economic support to citizens and businesses facing financial liquidity problems due to the COVID-19 epidemiological emergency.

1) Suspension of deadlines for payments and other obligations in the Red Zone

  • The payment of water, Payments with due date in the period between February 23, 2020 and April 30, 2020, relating to: payment slips issued by collection agents; debit notices issued by social security and insurance agencies; executive assessment documents issued by the Customs and Monopolies Agency; executive assessment documents issued by local authorities for both tax and asset revenues; “scrapping-ter”; “balance and write-off”. The deadline for these payments is extended to May 31, 2020.
  • The payment of water, gas and electricity bills, is extended to April 30, 2020, with a forecast of the eventual instalment of the bills once the period of suspension has ended.
  • The payment, for 12 months, of the instalments of subsidized loans granted by Invitalia to companies.
  • Payment of chamber fees.
  • The suspension of the deadlines for compliance and payments, already provided for in the decree of the Minister of Economy and Finance of February 24, 2020, is extended to taxpayers who reside outside the “Red Zone” but make use of intermediaries who are located there.
  • The deadlines for the provision of the data necessary to prepare the pre-filled tax return are extended. In this way, professionals and economic operators – wherever located on the national territory – will have more time to collect and transmit the data subject to this fulfillment.

2) Measures to support families, employees and self-employed workers and to strengthen social shock absorbers in the Red Zone

  • Ordinary redundancy fund for production units operating in the listed municipalities and for workers domiciled there (recourse to the redundancy fund is extended to employers enrolled in the Wage Supplement Fund – FIS).
  • Possibility of suspending the extraordinary redundancy fund for companies that had used it before the health emergency, replacing it with the ordinary redundancy fund.
  • Supplementary redundancy fund for employers in the private sector, including the agricultural sector, with production units operating in the listed municipalities and for workers domiciled in those municipalities, who are not eligible for current income support instruments, for the duration of the suspension of the employment relationship and in any case for a maximum period of three months.
  • Indemnity of €500 per month, for a maximum of three months, for workers who have coordinated and continuous collaboration relationships, for commercial agents, professionals and self-employed workers (including business owners registered with the General Compulsory Insurance – AGO) domiciled or carrying out their activity in the listed municipalities, based on the actual duration of the suspension of the activity.

3) Measures in favor of those subjects affected, even indirectly, by the consequences of the health emergency

  • The increase in the provisioning of the Guarantee Fund for small and medium-sized enterprises (PMI) and, for 12 months, the guarantee of the priority of granting credit to those operating in the ‘Red Zone’, including those in the agri-food sector. The grant is free of charge, for a maximum amount per individual company of €2.5 million and a maximum percentage of cover of 80% if direct guarantee operations and 90% if reinsurance. The intervention may be extended, by subsequent decrees of the Minister of Economic Development, for specific periods, to SMEs with headquarters in areas adjacent to the “Red Zone” which have suffered exceptional damage, or which are part of a particularly affected sector.
  • The suspension of payment of instalments on residential property loans for workers who are suspended from work or with reduced working hours for a period of at least 30 days.
  • The €350 million increase in funds to support exporting companies.
  • The extension of the validity of health cards and the National Service Card.
  • Measures to facilitate the use of smart working by government employees.
  • The maintenance of civil servants’ remuneration in the event of sickness with hospitalization or absence due to COVID-19 illness, including periods of quarantine.
  • The possibility for medical and surgical graduates, who are unable to take the State examination for the qualification to practice as a medical surgeon due to the decree of February 24, 2020 of the Minister of University and Research, to attend with reserve the specific training course in general medicine.
  • The preservation of the validity of the school year, even if the institutes cannot carry out the two hundred days of lessons provided for by the regulations following the containment measures.
  • The extension of the tax regime for food donations (non-taxable for VAT and income tax purposes) to donations of other goods (clothing, computers, etc.) .
  • The establishment of a revolving fund for the granting of interest-free loans for agricultural enterprises in difficulty.
  • The postponement to February 15, 2021, of the deadlines for the reporting obligation (the so-called “alert procedure”), which burdens internal control bodies and auditors, introduced by the Code of Business Crisis and Insolvency (Legislative Decree no. 14 of January 12, 2019), to allow for a gradual adaptation to this novelty, preventing the emergency from having consequences for those who have such an obligation and may be unable to cope with it.

In addition, the Cassa Depositi e Prestiti (CDP) has taken measures to help companies deal with COVID-19. Through “Piattaforma Imprese”, the Cassa Depositi e Prestiti (CDP) plans to disburse up to €1 billion in favour of SMEs and Midcap at a moderate rate.

Tourism Sector

For accommodation facilities, travel agencies and tour operators, the payment of social security contributions and withholding taxes will be suspended until April 30, 2020.

Specific forms of compensation are envisaged for users who have not been able to travel to and from the “Red Zone”, or take advantage of tourist packages due to the measures implemented in order to contain and prevent the spread of COVID-19 enforced by the Italian or foreign authorities. 

DPCM of march 1

Moreover, on March 1, 2020, the Prime Minister, Giuseppe Conte, adopted a decree transposing and extending some measures already adopted for the containment and management of the epidemiological emergency from COVID-19 and introducing further measures.

Below are measures, additional to previous decrees, that have an impact on businesses and, more in general, on the economic system.

In order to counter and contain the spread of the COVID-19 virus in Emilia-Romagna, Lombardy and Veneto and in the provinces of Pesaro, Urbino and Savona, the following containment measures have been adopted:

  • The running of restaurant, bar and pub activities, provided that the service is carried out for seating only and that, taking into account the size and characteristics of the premises, patrons are able to respect the distance of at least one meter between each other.
  • The opening of commercial activities other than those mentioned above is subject to the adoption of organizational measures such as to allow access to these places with quota restrictions or otherwise suitable to avoid crowds of people, taking into account the size and characteristics of the premises open to the public, and such as to ensure that visitors can respect the distance of at least one meter between each other.

In the provinces of Bergamo, Lodi, Piacenza and Cremona only, on Saturdays and Sundays, it is applied the closure of medium and large sales structures and shops inside shopping centers and markets, with the exception of pharmacies, para-pharmacies and food stores.

On the entire national territory, smart-working, governed by Articles 18 to 23 of Law no. 81 of 22 May 2017, may be applied, for the duration of the state of emergency referred to in the resolution of the Council of Ministers of 31 January 2020, by employers to any employment relationship, in compliance with the principles dictated by the aforementioned provisions, even in the absence of the individual agreements provided for therein. The reporting obligations pursuant to art. 22 of Law no. 81 of 22 May 2017 are fulfilled electronically, also by using the documentation made available on the website of the National Institute for Occupational Accident Insurance.

The Government is developing further measures, soon to be approved, for the economic support of citizens, families and businesses, related to the health emergency for the spread of COVID-19, and more globally for the economic growth of the country.