Although negotiations regarding the method of capping electricity and gas prices are still ongoing, both at the national level and in the EU, the Government of the Czech Republic has already issued the expected amendment specifying the capping of energy prices for large enterprises.
According to the current EU Temporary Framework, large enterprises are limited in terms of the amount of support they can receive within the European Economic Area. This threshold is not limited in time, it will be applied to all support issued by individual Member States in connection with the Russian aggression in Ukraine. However, the established mechanism for calculating the threshold runs into problematic verification of approved support to large enterprises by individual states. In principle, the aforementioned amendment pre-empts the likely future adjustment of the EU Temporary Framework and introduces national thresholds that will only be applied to businesses within the Czech Republic.
The lowest threshold was set by the government at EUR 2 million. However, in the case of high eligible energy supply costs, it can be several times higher.
Large enterprises are now obliged to report the amount of property benefit (i.e. the amount of support exceeding the relevant thresholds) to the Ministry of Industry and Trade every quarter.
Exceeding this threshold during the quarter is not a violation, but the company will be obliged to transfer the excess property benefit back to the state budget.
By David Nemecek, Associate, Eversheds Sutherland