RESTRICTED
WORLD TRADE G/SCM/Q2/KOR/6
8October 1996
ORGANIZATION(96-4073)
Original: Spanish Committee onSubsidies andCountervailing Measures
SUBSIDIES
Questions from ARGENTINA Regarding theNew
andFullNotification ofKOREA1
Thefollowing communication, dated 20September 1996, hasbeenreceived fromthePermanent
Mission ofArgentina.
_______________
QUESTIONS TOKOREA
1. Korea hasnotified anumber ofsubsidy programmes formanufacturing industry, including:
1.1 Reserves forExport Losses. Korea states thatthisprogramme willlastuntil
31December 1998. Does Korea intend toincrease thelevels ofsubsidies under this
programme? CanKorea statewhether itwilldefinitively eliminate thisprogramme
afterthatdate, inaccordance withtheguidelines laiddown inArticle 27.4ofthe
Subsidies Agreement?
1.2 Reserves forOverseas Market Development. Korea states thatthisprogramme will
lastuntil31December 1998. Does Korea intend toincrease thelevels ofsubsidies
under thisprogramme? CanKorea statewhether itwilldefinitively eliminate the
programme afterthatdate,inaccordance withtheguidelines laiddown inArticle 27.4
oftheSubsidies Agreement?
1.3 TaxCredit forInvestment inFacilities. Korea describes sixdifferent modalities of
thissubsidy programme. With respect totheduration ofthese programmes, itonly
states thatoneofthese -"taxcredits forinvestments infacilities forincreasing
productivity andspecial equipment" -willexpire on31December 1996. Does Korea
intend toincrease thelevels ofsubsidies under thismodality ofthisprogramme? Can
Korea statewhether itwilldefinitively eliminate thismodality oftheprogramme after
thatdate,inaccordance withtheguidelines laiddown inArticle 27.4oftheSubsidies
Agreement? Withrespect totheothermodalities, noexpiry dateisgiven. Could Korea
specify adatefortheelimination ofthesemodalities ofthisprogramme, inaccordance
withtheguidelines laiddown inArticle 27.4oftheSubsidies Agreement?
1G/SCM/N/3/KOR +Rev.1.
./.G/SCM/Q2/KOR/6
Page2
1.4 Facility Investment Loans provided bytheSMEs Foundation Formation Fund, Tax
Reduction andExemption forForeign Invested Enterprises, Support Programme for
Maintenance ofFarm Machinery, Assistance Programme toPromote theSpread of
Domestically Produced Mini-computers, andSupporting Fund forStone Industry.
With regard toallthese programmes, Korea states thattheyhavenotime-limits, in
some cases, orgives noinformation inthisrespect inother cases. Could Korea specify
thedates fortheelimination ofthese programmes, inaccordance withtheguidelines
laiddown inArticle 27.4oftheSubsidies Agreement?
2. Korea notifies anumber ofresearch anddevelopment programmes: Research andDevelopment
Activities forLow-Emission Autovehicle, Research andDevelopment Activities Supported bythe
Information andCommunication Promoting Fund, Environmental Engineering andTechnological
Development Programme, andPromotion Fund forScience andTechnology. Could Korea provide
information inaccordance withArticle 8.2(a) oftheSubsidies Agreement onthefollowing:
2.1 What percentages ofthecosts oftheresearch activities arecovered byeachofthe
subsidies listed above?
2.2 What items ofthefirms'research business activity arecovered byeachofthesubsidies
listed above, suchasstaffcosts, instrument costs, consultancy costs, etc.?
With regard toquestion 1.4:
These programmes provide forareduction ininterest ratesonloans toenterprises suchas
companies producing farmmachinery andmini-computers. Thisreduction constitutes asubsidy
included intheListinAnnex I.Willthemargin ofsubsidy bereduced orwillitbemaintained
asitis?