The Federal Department for Economic Affairs and Energy has now specified the requirements for payment of the so-called extraordinary economic aid.
 
First of all, it has been confirmed that the financial aid must be requested via the website www.ueberbrueckungshilfe-unternehmen.de. Self-employed individuals who do not apply for support of more than 5.000,00 EUR are not required to have a controller (tax advisor, lawyer, etc.) for the application.
 
For companies in the form of a GmbH and UG (limited liability), it is not the time of establishment that is relevant, but the time operations started. For example, if a GmbH was founded in May 2019, but did not start operations until May 2020, the GmbH should be entitled to receive financial aid based on its turnover of October 2020.
 
Companies will receive compensation of 75% of the turnover the company made during the same period of the previous year. The Federal Department for Economic Affairs and Energy has now also answered the question of how take-away services, i.e. deliveries and self-pickup (“To-Go“) will be dealt with when applying for extraordinary economic aid.
 
In the following, Sangong law firm will illustrate the financial support a permanently closed restaurant would receive and the financial support a restaurant that is open for take-away sales would receive:
 
Version 1: The restaurant closes permanently for November 2020 and does not offer any take-away services.
 
Turnover November 2019
 
Total                                                                 10,000.00 EUR
 
> Of which in the restaurant              8,000.00 EUR
 
> Of which take-away                            2,000.00 EUR
 
Entitlement to support in November 2020:
 
In November 2020 the restaurant would receive financial aid in the amount of 75% of the turnover it made during the same period of the previous year. In this case the restaurant made a total of 10,000.00 EUR in November 2019. The restaurant therefore receives 7.500,00 EUR compensation, minus any other official support it may have received, such as short-time allowance.
 
Version 2: The restaurant opens for take-away sales in November 2020.
 
Sales November 2019
 
Total                                                                 10,000.00 EUR

> Of which in the restaurant              8,000.00 EUR
 
> Of which take-away                            2,000.00 EUR
 
Entitlement to support in November 2020:
 
The restaurant receives financial aid in the amount of 75% of 8,000.00 EUR (not 10,000.00 EUR!). When calculating financial aid, turnover made through take-away services in November 2019 will not be taken into account. Therefore, the restaurant receives financial support to the amount of 6,000.00 EUR.
 
The restaurant can make extra turnover through take-away services (deliveries, pick-up). The absolute limit for additional earnings is 100% of the total amount of turnover made in November 2019. In the example, the total amount of turnover was 10,000.00 EUR. The restaurant in the example may not make more than 4,000.00 EUR turnover through take-away services without any deductions from government support, which it already received or receives.
 
This content has been compiled based on the currently available information. The information is therefore not legally binding.
 
If you have any questions regarding this subject or company closures in general, please contact us. Sangong law firm will keep you updated.
 
This text is also available in German and Chinese. Just go to the News section in your preferred language.

Due to the developments of the corona pandemic, new regulations have been in effect since November 2, 2020. The gastronomy business is also affected by the extensive restrictions in the private and public sector. Restaurants must close by November 30, 2020. Exceptions only apply to delivery or pick up of food. In order to compensate for the financial losses, it was decided that restaurants would be reimbursed 75% of the turnover of the same month last year if the company has no more than 50 employees. It is a so-called extraordinary economic aid.
 
Questions from our clients
 
Clients of Sangong law firm have frequently the following questions, which should be answered here in general for interested gastronomic businesses: 

1. How do I get my financial aid?
2. When will I get my financial aid?
3. How high will the support be?
4. Does the financial aid also apply to companies that are still delivering or preparing food for collection ("To-Go")?
5. What if I had not opened in the year before? Will I still get financial aid?

 
(Temporary) answers

1. As of November 2, 2020, the federal government is still working on making the application and processing feasible. It is intended that the application procedure will be executed by the website www.ueberbrueckungshilfe-unternehmen.de.
2. This is also not yet clear as of November 2, 2020. The possibility of an advance payment is currently being examined.
3. According to the Federal Department of Finance, restaurants should in particular be reimbursed for their fixed costs. These are the costs that arise despite a closure. To keep the approval simple, 75% of the corresponding turnover of the same period of the year before or the month before should be reimbursed.
4. The resolution does not contain any information on this. It cannot be ruled out that a reimbursement is not possible or only possible to a lesser extent in these cases.
5. Young companies founded after November 2019 should be allowed to use October 2020 sales as a benchmark. It is currently still completely unclear what happens to companies that were founded as GmbH or UG (limited liability) in November 2019 or before and only started their business activities later.

 
It must also be pointed out that the extraordinary economic aid for the relevant period of October 2020 will be cleared against other support programs already received, such as short-time working allowance.
 
Conclusion
 
Experience has shown that federal or state support is actually not as easy to obtain as announced by authorities. Here, too, it remains to be seen how the program will actually be implemented.
 
Sangong law firm will keep you updated. If you have any questions on this topic or other related questions, please contact us.

​This text is also available in German and Chinese. Just go to the News section in your preferred language.