WORLD TRADE
ORGANIZATIONG/SCM/N/60/EEC/Add.9
21 November 2000
(00-4944)
Committee on Subsidies
and Countervailing MeasuresOriginal:  English
SUBSIDIES
Updating Notifications Pursuant to Article XVI:1 of the GATT 1994
and Article 25 of the Agreement on Subsidies and
Countervailing Measures
EUROPEAN COMMUNITIES
Addendum
The following addendum to the notification of  the European Community relates to subsidy
programmes of Italy .G/SCM/N/60/EEC/Add.9
Page 2
ITALY
TABLE OF CONTENTS
Page
1. Aid scheme for the promotion of youth enterprise in Italy...................................................3
2. Fiscal measures in favour of innovation of industrial enterprises........................................4
3. Urgent measures for the econo my – Automatic incentives ...................................................4
4. Contribution to the realization of Nati onal Energy Plan aimed at rationalising
the use of energy and renewable energy sources....................................................................5
5. Female Entrepreneurs......................................................................................................... .....6
6. Production aids to shipyards................................................................................................. ...7
7. Home credit scheme to ship owners ........................................................................................7
8. Special Fund for the reconversion of the asbestos production .............................................8
9. Soft loans for Italian enterprises to cover expenses concerning the participation
in international tenders held  in non-EU countries................................................................9
10. Support to the reduction of energy consumption.................................................................1011. Support to Innovation and Development in SME’s.............................................................10
12. Incentives to manufacturing and extractive  enterprises in disadvantaged regions..........11
13. Soft loans to companies to favour a long-lasting penetration in non-EU
countries...................................................................................................................... .............12
14. Technological Innovation Fund (FIT)...................................................................................1215. Extraordinary intervention in the South of Italy.................................................................13
16. Credit scheme to co-operatives and urgent measures for employment protection...........14
17. Increase of “Artigiancassa” fund for interest contributions to handicraft sector ............15
18. Interest Rate Subsidies for the Industrial Sector.................................................................15
19. Special Fund for Applied Research Fund (FRA).................................................................16G/SCM/N/60/EEC/Add.9
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1. Aid scheme for the promotion of youth enterprise in Italy
1. Name of the subsidy scheme and legal basis
Aid scheme for the promotion of youth enterp rise in Italy – Law 95/95 (ex Law 44/86) and
236/93
2. Form of the subsidy
Grant
Interest SubsidyOther (Management Contribution). Moreover both Laws provide for tutorship for financed
enterprises)
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
Law 95/95 (in Million)     Law 236/93 (in Million)
Grant 127.098     5.028
Interest Subsidy 102.030     2.344
Management Contribution   47.640        824
Total 276.768     8.196
4. Policy objective and/or purpose of the subsidy
To encourage young people in the disadvantaged Regions of the country, defined according to
UE Objectives 1, 2 and 5b, to undertake industrial activities.
5. Duration of the subsidy
Law 95/95 (ex Law 44/86): 2 years;
Law 236/93: 3 years.
7. Statistical data permitting an assessment of the trade effects of the subsidy
Due to its nature the schemes only have an insignificant impact on trade.
8. Indicate to whom and how the subsidy is paid
Both laws (95/95 and 236/93) aim to encourage and support new entrepreneurial initiatives
among young people (between 18 and 35), residents, in the disadvantaged areas identified according
to EU parameters.G/SCM/N/60/EEC/Add.9
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2. Fiscal measures in favour of innovation of industrial enterprises
1. Name of the subsidy scheme and legal basis
Law 140/97, Art. 13. Fiscal measures in favour  of innovation of industrial enterprises
2. Form of the subsidy
Tax concession
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
307.5 Billion lira.
4. Policy objective and/or purpose of the subsidy
Promotion of investments  of enterprises in R. & D.
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Due to its nature the scheme only has an insignificant impact on trade.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are enterprises operating all over the national territory.
(B) The subsidy consists in the concession of a fiscal bonus in tax payment.
3. Urgent measures for the economy – Automatic incentives
1. Name of the subsidy scheme and legal basis
Law 266/97, Art. 8.2 . Urgent measures for the economy – Automatic incentives
2. Form of the subsidy
Tax concession
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
8.97  Billion lira.
4. Policy objective and/or purpose of the subsidy
Promotion of investments  of enterprises in machinery.G/SCM/N/60/EEC/Add.9
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5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Due to its nature the scheme only has an insignificant impact on trade.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are enterprises operating all over the national territory.
(B) The subsidy consists in the concession of a fiscal bonus in tax payment.
4. Contribution to the realization of National Energy Plan aimed at rationalising the use of
energy and renewable energy sources
1. Name of the subsidy scheme and legal basis
Law n. 10/91 - Contribution to the realization of National Energy Plan aimed at rationalising
the use of energy and renewable energy sources
2. Form of the subsidy
Grant
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
28.69 Billion lira.
4. Policy objective and/or purpose of the subsidy
Energy efficiency, research and developmen t, technological innovation, environment
protection.
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Not relevant: the measure is not specific and it is notified for the sake of transparency.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are public and private companies, and related consortia, operating in
industrial and service sectors.
(B) The amount of the grant is related to the level of the investment and to the expenses
of the saved energy or produced with renewable sources.
The payment is made in one solution or in tranches.G/SCM/N/60/EEC/Add.9
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5. Female Entrepreneurs
1. Name of the subsidy scheme and legal basis
Law n. 215/92 – Female Entrepreneurs.
2. Form of the subsidy
Grant
Interest Subsidy
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
Grant: 24.92 Billion lira.I. S.  :   0.07    “         “
4. Policy objective and/or purpose of the subsidy
(a) Promotion of new female activities in different fields (industry, agriculture, trade,
services and handicraft);
(b) Promotion and development of new qualified female entrepreneurs.
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Not relevant: the measure is not specific and it is notified for the sake of transparency.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are SME’s owned by females operating in different sectors: industry,
agriculture, trade, handicraft and services: in case of a capital society, majority has to
be owned by females; in case of personal society, 60 per cent of partners has to be
females.
(B) Ministry of Industry concedes contribution in a variable measure (from 15 per cent up
to 65 per cent in ESL) depending on geographical location of the enterprises.
Contribution is derogated in two tranches: the first, equivalent to the 40 per cent of
the contribution, during the realisation of the project; the second when the project is
complete.G/SCM/N/60/EEC/Add.9
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6. Production aids to shipyards
1. Name of the subsidy scheme and legal basis
Law n. 234/89 and Law n. 132/94 (implementing the sixth and the seventh directive on aids to
shipbuilding) - Production aids to shipyards
2. Form of the subsidy
Grant
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
328  Billion lira.
4. Policy objective and/or purpose of the subsidy
To bridge the gap between the most competitive EU shipyard and the market prices.
5. Duration of the subsidy
According to EU rules (Production ai ds are allowed until 31 Dec. 2000) .
6. Statistical data permitting an assessment of the trade effects of the subsidy:
As regards the commercial effects, the Italian shipyards were allowed by EU rules to maintain
their own position on the market on an equal basis as far as competitive conditions are concerned.
7. Indicate to whom and how the subsidy is paid
(A) To shipyard.(B) To the shipyard during the construction of the ship up to 75 per cent of the subsidy
and the remaining 25 per cent  after the delivery of the ship.
7. Home credit scheme to ship owners
1. Name of the subsidy scheme and legal basis
Law n. 234/89 and Law n. 132/94 (implementing the sixth and the seventh directive on aids to
shipbuilding) - Home credit scheme to ship owners
2. Form of the subsidy
Interest Subsidy (equivalent to loans at OECD terms – according to the understanding on
export credits for ship – OECD Council Resolution dated 3 August 1981)
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999:
170 Billion lira.G/SCM/N/60/EEC/Add.9
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4. Policy objective and/or purpose of the subsidy
To bridge the difference between the Italian financing terms and standard OECD financing
terms. The ship owner’s subsidies are granted in 17 half yearly instalments.
5 Duration of the subsidy
According to OECD rules (8.5 years).
6. Statistical data permitting an assessment of the trade effects of the subsidy
As regards the commercial effects, the Italian ship owners were allowed to work  on an equal
basis on the market as far as financing conditions are concerned.
7. Indicate to whom and how the subsidy is paid
(A) To ship owners.(B) The subsidies are granted in 17 half yearly instalments according to the understanding
OECD Council Resolution on export credits for ships.
8. Special Fund for the reconversion of the asbestos production
1. Name of the subsidy scheme and legal basis
Law 257/92 - Special Fund for the reconversion of the asbestos production
2. Form of the subsidy
Grant
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
Distributed: 2.65  Billion lira
4. Policy objective and/or purpose of the subsidy
Facilitating reconversion of the asbestos production. Allowances are granted to enterprises
which gave up producing asbestos, in order to improve environmental standards of the whole
industrial sector.
5. Duration of the subsidy
Final  term for the submission of the request under this scheme was October 1995.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Due to its nature the scheme only has  an insignificant impact on trade.G/SCM/N/60/EEC/Add.9
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7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are companies reconverting their production with the aim to eliminate
asbestos.
(B) The grant is equal to 15 per cent or  30 per cent of the cost of the approved project.
The subsidy is paid in one solution after a final inspection.
9. Soft loans for Italian enterprises to cover expenses concerning the participation in
international tenders held  in non-EU countries.
1. Name of the subsidy scheme and legal basis
Law n. 304/90, Art. 3 – Soft loans for Italian enterprises to cover expenses concerning the
participation in international tenders held  in non-EU countries.
2. Form of the subsidy
Soft Loan
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
1 Billion lira.
4. Policy objective and/or purpose of the subsidy
The soft loan is referred to expenses born by  Italian companies who intend  to submit pre-
qualification applications for international tenders in non-EU Countries.
5. Duration of the subsidy
A final term is not established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Due to its nature  the scheme only has an insignificant impact on trade.
7. Indicate to whom and how the subsidy is paid
Beneficiary companies belong mainly to civil and industrial construction, infrastructures,
plans etc.
The soft loan is paid by Simest S.p.A. on the basis of the documents demonstrating the costs
born by the recipient. The  maximum amount which can be granted is 2 billion lira and is related to
the procurement value.G/SCM/N/60/EEC/Add.9
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10. Support to the reduction of energy consumption
1. Name of the subsidy scheme and legal basis
Law n. 308/82 - Support to the reduction of energy consumption
2. Form of the subsidy
Grant
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
12  Billion lira.
Note:  Although the law 308/82 has been replaced by the law 10/91, the reported amounts are
referred to the obligations engaged before the entering into force of law 10/91.
4. Policy objective and/or purpose of the subsidy
Energy efficiency, research and technological innovation.
5. Duration of the subsidy
In 1992 possibility to submit requests under this scheme is ceased.
6. Statistical data permitting an assessment of the trade effects of the subsidy:
Due to its nature the scheme has an insignificant impact on  trade.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are public and private companies, and related consortia, operating in
industrial and service sectors.
(B)  The amount of the grant is related to the level of the investment and to the expenses
of the saved energy or produced with renewable sources. The payment is made in one
solution or in tranches.
11. Support to Innovation and Development in SME’s
1. Name of the subsidy scheme and legal basis
Law n. 317/91 - Support to Innovation and Development in SME’s
2. Form of the subsidy
Grant/Tax concession
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
Global Amount 493.73 Billion liraG/SCM/N/60/EEC/Add.9
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Note: These figures refer to the global amount of subsidies distributed during 1999, by the
Ministry of Industry, Trade and Handicraft to the Small and Medium Enterprises (S.M.E.) and
Services Consortia.
4. Policy objective and/or purpose of the subsidy
Development of SMEs’, SMEs’ consortia, SMEs’ services consortia.
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
This programme should be considered non specific. It is notified all the same for the sake of
transparency.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are SME’s in industrial and services sector; SME’s consortia.
(B) On request of the beneficiaries through contribution in grants or tax concessions.
12. Incentives to manufacturing and extractive  enterprises in disadvantaged regions
1. Name of the subsidy scheme and legal basis
Law n. 341/95, Art. 1 – Incentives to manufacturing and extractive enterprises in
disadvantaged regions
2. Form of the subsidy
Tax concession
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
89 Billion lira.
4. Policy objective and/or purpose of the subsidy
Providing incentives to industrial enterprises operating in disadvantaged regions.
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy:
Due to its nature the scheme only has an insignificant impact on trade.G/SCM/N/60/EEC/Add.9
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7. Indicate to whom and how the subsidy is paid
(A) Industrial companies operating in areas ob. 1, 2  and 5b.
 (B) Companies are allowed to benefit of a fiscal  “bonus” in tax payment in the next five
years.
13. Soft loans to companies to favour a long-l asting penetration in non-EU countries.
1. Name of the subsidy scheme and legal basis
Law n. 394/81, Art. 2 - Soft loans to companies to favour a long-lasting penetration in non-
EU countries.
2. Form of the subsidy
Soft Loan
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
16.8  Billion lira
4. Policy objective and/or purpose of the subsidy
The programme is meant to facilitate the in ternationalization of Italian companies (mostly
small and medium sized), by helping them to create stable commercial  operations abroad (such asoffices, stores, show-rooms etc.).
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy:
Not relevant: the measure is not specific and it is notified for the sake of transparency.
7. Indicate to whom and how the subsidy is paid:
Beneficiaries are in the following sectors: Industry 81.7 per cent - Trade 11.9 per cent -
Services 6.4 per cent.
The maximum level  of funding  is fixed at 85 per cent of the total planned expenses.
14. Technological Innovation Fund (FIT)
1. Name of the subsidy scheme and legal basis:
Law n. 46/82, Art. 14 and followings: Technological Innovation Fund (FIT)G/SCM/N/60/EEC/Add.9
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2. Form of the subsidy
Grant
Soft Loan
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
Distributed: 332.3  Billion lira .
4. Policy objective and/or purpose of the subsidy
Promoting pluri annual programmes aimed at  introducing technological innovations..
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Due to its nature the scheme has an insignificant impact on trade.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are industrial and service enterprises. Big firms are eligible only if they
act in the main sectors mentioned in the legal framework.
(B) The soft loan rate changes from 25 per cent to 60 per cent of the reference rate,
according to the dimensions and the  geographical location of the enterprise; it is
accorded for 15 years maximum (of which 5 years are pre-amortisation) and it is
equal to 35 per cent - 55 per cent of the admissible costs.
15. Extraordinary intervention in the South of Italy
1. Name of the subsidy scheme and legal basis
Art. 1, section 2, Law n. 488/92 (re-financing of   Law n. 64/86),  concerning Extraordinary
intervention in the South of Italy
2. Form of the subsidy
Grant
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
1,098.3  Billion lira.
4. Policy objective and/or purpose of the subsidy
Providing aid to entrepreneurial activities in the disadvantaged areas.G/SCM/N/60/EEC/Add.9
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5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Not relevant: the measure is not specific and it is notified for the sake of transparency.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are extractive and manufacturing enterprises and related service
companies.
(B) Contributions are paid  under the EU am ount limits in favour of the disadvantaged
areas and they are derogated every 4 months.
16. Credit scheme to co-operatives and urgent measures for employment protection
1. Name of the subsidy scheme and legal basis
Law n. 49/85 - Credit scheme to co-operatives and urgent measures for employment
protection
2. Form of the subsidy
Grant
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
13.6 Billion lira
4. Policy objective and/or purpose of the subsidy
The scheme is intended to provide grants and soft loan to co-operatives in order to tackle
unemployment. In particular, it encourages new enterprises created by workers who have been fired,
who are in a mobility list or have been suspended from work in an overmanned factory.
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Not relevant: the measure is not specific and it is notified for the sake of transparency.
7. Indicate to whom and how the subsidy is paid
(A) Beneficiaries are co-operatives with a maximum invested capital of 0.5  billion lira
for restructuring or reconversion activities.
(B) Contributions (which last maximum for 12 y ears) are derogated in a single tranche or
in different period.G/SCM/N/60/EEC/Add.9
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17. Increase of “Artigiancassa” fund for interest contributions to handicraft sector
1. Name of the subsidy scheme and legal basis
Increase of “Artigiancassa” fund for interest contributions to handicraft sector – Law 526/82
2. Form of the subsidy
Interest Subsidy
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
355 Billion lira
4. Policy objective and/or purpose of the subsidy
Making credit more accessible to handicraft undertakings.
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Due to its nature the scheme only has an insignificant impact on trade.
7. Indicate to whom and how the subsidy is paid
Beneficiaries are handicraft enterprises which receive funds through the financing bank.
Interest subsidy is paid every six months.
18. Interest Rate Subsidies for the Industrial Sector
1. Name of the subsidy scheme and legal basis
Law n. 902/76 - Interest Rate Subsidies for the Industrial Sector
2. Form of the subsidy
Interest Subsidy
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
8.43  Billion lira
4. Policy objective and/or purpose of the subsidy
SMEs’ development.G/SCM/N/60/EEC/Add.9
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5. Duration of the subsidy
The scheme is no longer in force since the law was abrogated. The above figure refers to the
amount the Administration is still distributing due to previous decisions.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Not relevant: the measure is not specific and it is notified for the sake of transparency.
7. Indicate to whom and how the subsidy is paid
(A) SME’s in industrial sector  operating in the Center and in the North of Italy.
(B) Contributions Post 10 years; interest rate is equivalent to 40 per cent - 60 per cent of
the rate of reference. Contribution is derogated every 6 months.
19. Special Fund for Applied Research Fund (FRA)
1. Name of the subsidy scheme and legal basis
Law n. 46/82: Special Fund for Applied Research Fund (FRA), Decisions of Ministry
08.08.97 and 1.12.1997.
2. Form of the subsidy
Grant Soft Loan
3. Subsidy per Unit or, in case this is not possible, the global amount of subsidies distributed
during 1999
grant   39.0 Billion lira
soft loan 432.7 Billion lira
_____________
Total  471.7 Billion lira
4. Policy objective and/or purpose of the subsidy
To encourage incentives to pluri-annual programmes aimed to introduce technological
innovations.
5. Duration of the subsidy
No final term is established.
6. Statistical data permitting an assessment of the trade effects of the subsidy
Not relevant: the measure is not specific and it is notified for the sake of transparency.G/SCM/N/60/EEC/Add.9
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7. Indicate to whom and how the subsidy is paid
(A) Industrial firms, consortia, research companies, public or private laboratories.
(B) Activities of industrial search can benefit a contribution up to 50 per cent in ESL of
the cost of the project.  For pre-competitive activities maximum amount is 25 per cent
in ESL.
__________