Blenheim advises clients in relation to subsidies. Subsidies are paid as an advance, with the final amount later determined. If the final amount is less than subsidy (or zero) it is important to investigate the reasons for this carefully. Subsidies are often scarce rights – meaning that some candidates are often left out (and not always rightly so).
Subsidy schemes provide individuals or business owners with government support for the realisation of a particular project or for carrying out certain work. Common subsidy schemes include UWV’s employer subsidies, the possibility of an investment allowance (KIA, EIA, MIA and VAMIL), Stimulation of Sustainable Energy Production and Climate Transition (SDE++) subsidies, and the contribution to wage costs under the Emergency Bridging Measures for Employment (NOW).
Subsidies for employers
Two well-known subsidies for employers are the Loonkostenvoordeel (LKV) and the No-risk policy or No-risk declaration. The LKV offers employers the opportunity to receive an allowance for the continued employment of older employees and employees with a disability. An employer is eligible if the employee in question started working for the employer, or was redeployed internally, on or after 1 January 2018. In addition, the employee must apply for a LKV target group declaration (doelgroepverklaring) within three months of commencing employment. The employer must submit a copy of this when applying for the LKV.
The No-risk policy applies to employees with a disability, long-term illness, those who experience long-term unemployment, or who are registered in the target group register. This results in the employer receiving a benefit under the Ziektewet-uitkering ontvangt (Sickness Benefits Act) from the UWV if this employee falls ill (again), as a result of which the employer does not have to pay a significant part of the salary. A No-risk Policy is, in principle, valid for a maximum of five years. For more information on the regulations, visit the UWV website.
Business owners are entitled to a reimbursement when they make investments in business assets. These include the small-scale investment allowance (KIA), energy investment allowance (EIA), environmental investment allowance (MIA) and random depreciation of environmental investments (VAMIL). For the EIA, the asset in which the investment is made must be on the energy list of the Netherlands Enterprise Agency (RVO). For the MIA and VAMIL, the business asset must be included in the environmental list.
Business owners who wish to invest in installations for the production of renewable energy can make use of the SDE++ subsidy. The energy generated must be from biomass, geothermal, water, wind, offshore wind, or sunlight. The subsidy is intended to compensate, in whole or in part, the difference between the market price and the average cost of the renewable energy during a certain period of time. The SDE++ subsidy is provided by the RVO. The recipient of the subsidy is obliged to install the product within a specified period. The number of years for which the subsidy is granted depends on the technology used to produce the renewable energy.
The NOW scheme was created to support employers during the corona crisis. Any employer who suffers a loss of turnover of at least 20% is eligible for compensation for wage costs. The NOW scheme is classified as a subsidy scheme. The UWV provides an advance payment on the subsidy and determines the final amount of the subsidy. Because the final determination is made retrospectively, and is based on the actual loss of turnover, there is a chance that the subsidy will be lower than the advance payment.
The NOW scheme is administrative in nature. However, as the scheme is entirely concerned with the reimbursement of employers’ wage costs and thus to employment law structures, knowledge of employment law is equally important in legal disputes. Blenheim has in-house lawyers specialising in administrative law and employment law. In order to provide comprehensive advice, our lawyers combine their knowledge and experience in handling disputes under the NOW scheme. At the start of the NOW scheme, they frequently advised employers on, among other things:
- The applicability of provisions of NOW-1, NOW-2 or NOW-3;
- The application of the group criterion in determining a decrease in turnover;
- Requesting an advance payment decision;
- The possibilities in situations where an advance payment was not granted or was of a limited amount;
- Requesting a determination decision; and
- Judicial review of NOW decisions.
On our website, you will find several blogs with information on the different versions of the NOW grant, previous court decisions, and points of interest relating to a lower determination or denial of the NOW subsidy.
Lower determination of a subsidy
Each subsidy scheme contains its own provisions and conditions under which the subsidy can be provided. Title 4.2 of the General Administrative Law Act (Awb) applies to each scheme. One of the consequences of these statutory subsidy rules is that a lower subsidy amount may ultimately be provided, something that regularly leads to objection and appeal procedures. The grounds on which a lower subsidy amount can be provided are:
- That the activities for which the subsidy was granted have not taken place or have not taken place in full;
- That the recipient of the subsidy has not fulfilled the obligations attached to the subsidy;
- That the recipient of the subsidy has provided incorrect or incomplete information and the provision of correct or complete information would have resulted in a different decision relating to the application for the subsidy; and
- That the subsidy was otherwise incorrect and the recipient knew it or should have known it.
If the subsidy is lower than the advance payment provided, it must be assessed whether this is based on the correct grounds. It is advisable to engage the services of an administrative law lawyer for this purpose.
Subsidy objections and appeals
It is possible to object to subsidy decisions made by the UWV, the RVO and other administrative bodies. An objection may be lodged against both the advance payment and the final subsidy determination. The reason for objecting may also have to do with any conditions attached to the advance payment, or requirements relating to the purpose of the subsidy (purpose-related obligations) with which you do not agree.
If the objection procedure does not lead to an outcome that is favourable for you, an appeal can be lodged. If you wish, you can then appeal to the Centrale Raad van Beroep (for NOW decisions), the College van Beroep voor het bedrijfsleven (for SDE decisions) or the Administrative Law Division of the Council of State.