Entrepreneurs in distress due to TVL ceiling: ‘We are in a very bad scenario’

Arjen Schrama is a franchisee of the Asian restaurant chain Wagamama in the Netherlands. He now runs eight branches, normally with about three hundred employees and an annual turnover of 20 million euros. But then corona came, and things had to close, open again and close again, we know the stories.

Interest on reserves

The costs continued and the (turnover) losses are now in the millions, the entrepreneur tells RTL Z. There was government support and it was badly needed: “We are not a multinational with large reserves.”

Schrama is instead putting out fires for survival: through schemes, deferred payments and loans. “I’m dying on all sides and it’s only hopeful that we can pay that back soon,” he says.

All balls on TVL

We are now in a ‘lockdown light’ and the catering industry has to close at 20:00. It puts many entrepreneurs in a difficult position again.

The cabinet therefore decided to reopen the TVL scheme (Compensation for Fixed Lasten). Companies from certain sectors that see their turnover fall by 30 percent will be reimbursed 85 percent of the estimated fixed costs. The NOW wage support will be canceled in the latest policy: all balls go to the TVL.

Entrepreneurs can probably sign up for the fourth quarter from the beginning of December, reports the executive of the Netherlands Enterprise Agency (RVO). Next week there will first be a debate about the policy, and approval from Brussels also has to be obtained.

EU rules

But there is a growing group of entrepreneurs who no longer qualify for that support. Schrama is one of them. The problem is EU regulations. Under those rules, the TVL is a form of state aid that is subject to a maximum amount.

The total support, that is over the entire corona crisis, may currently not exceed 1.8 million euros. “I already tapped that amount in the first quarter of this year,” he says.

Hotels on the ceiling

Larger companies in particular are gradually reaching that ceiling, employers’ organization VNO NCW knows. “1.8 million euros is a pittance for many,” said spokesman Edwin van Scherrenburg. It is an amount that barely covers the costs for them.

“We know that this is the case with hotel and restaurant chains, for example.” They can only rely on the TVL as a group and are therefore quickly at the maximum.

Whether you have one restaurant to your name or eight such as Schrama, you will receive a maximum of 1.8 million euros in TVL support. And that’s not fair, says Schrama. “The ceiling is unfair and anti-competitive,” he says.

It makes sure that he can’t get support now, while his problems are not over yet. “Nobody knows how long this will take, we are already heading for the third year.”

Wagamama not alone

Schrama is not alone. A group of about fifteen companies has now united in a foundation to stand up for this ‘forgotten group’. These include Brothers Horeca Groep (BHG), known for Brothers and restaurants such as Meneer Smakers and Zuiver. “It is a relatively small club,” said spokesman Guus van Herpen. “But they are street-determining and large employers.”

These entrepreneurs are gradually running into serious liquidity problems and (tax) debts, Van Herpen knows. “The bank accounts are no longer as lavishly filled as they might have been. Especially now that opening hours are limited again and many parties are canceled again. Not everyone dares to say so.”

Is the EU coming with a new ceiling?

The solution? According to both Schrama and Van Herpen, it would help if you could apply for support for each individual BV. The group connection has to go. Governments in Germany and Denmark are said to have set up individual support frameworks for these types of companies, which should also be possible here.

According to the entrepreneurs, the problem is now also being raised with outgoing Minister Blok of Economic Affairs. When asked, the ministry can’t say much yet, it is still being discussed and worked on behind the scenes.

Employers want more support

A spokesperson said that the European Commission will publish a new framework for state aid within a few days. “We are waiting for that to see whether the cap (ceiling, ed.) can be raised.”

In the run-up to next week’s debate, VNO-NCW will in any case aim for more and broader compensation for entrepreneurs. The organization also wants the lockdown to be lifted as of December 4.

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