RESTRICTED
WORLD TRADE G/SCM/Q2/JPN/7
8October 1996
ORGANIZATION(96-4068)
Original: English Committee onSubsidies andCountervailing Measures
SUBSIDIES
Questions from theUNITED STATES Regarding theNew
andFullNotification ofJAPAN1
Thefollowing communication, dated 27September 1996, hasbeenreceived fromthePermanent
Mission oftheUnited States.
_______________
I. Please provide information concerning thefollowing programmes which didnotappear tobe
included within Japan’snotification, yetmaymeetthenotification requirements ofGATT 1994and/or
theSCM Agreement. Please include information relevant totheelements requested inthenotification
format,orexplainthebasisonwhichJapandeterminedthateachprogrammedidnotmeetthenotification
requirements referenced above:
Export subsidies anddomestic subsidies granted ormaintained onagricultural products, e.g.
subsidies granted under the“Food Control Law”.
From 1995 Budget oftheGovernment ofJapan
Subsidy ofsupplying overseas economic information (MITI)
Subsidy ofoverseas public relations exhibits (MITI)
Subsidy oftheassociation topromote trade withdeveloping nations (MITI)
Subsidy forpromotion ofspecial types ofindustrial trade (MITI)
Subsidy foroperating overseas business office (MITI)
Subsidy ofdomestic management expenses (MITI)
Subsidy ofoperating expense forinvestigation ofoverseas market (MITI)
Subsidy ofoperating expenses forimproving product quality anddesign (MITI)
Subsidy ofoperating expenses forurgent maintenance ofspecial facilities usedintheprivate sector
(MITI)
Subsidy ofoperating expenses topromote special exhibitions (MITI)
Subsidy oftheexpenses forrecycling oldpaper (MITI)
Subsidy ofexpenses toprevent contamination from nolonger usedoremine (MITI)
Subsidy ofexpenses tooperate themetal orebusiness group (MITI)
Subsidy ofexpenses forsafety strategies ofchemical materials (MITI)
Subsidy ofexpenses toinvestigate thedevelopment ofnextgeneration airplanes (MITI)
Subsidy ofexpenses formeasure toprevent pollution from leather manufactures (MITI)
Subsidy tosmooth outreforms ofspecial businesses (MITI)
1G/SCM/N/3/JPN/Rev.1G/SCM/Q2/JPN/7
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Subsidy topromote andfoster newcompanies oftheresearch anddevelopment typeorknowledge
pooling type(MITI -specifically topromote recycling ofnon-ferrous metal materials)
Subsidy todevelop newmaterial technology (MITI)
Subsidy ofrelief strategies fortortoise shellindustry (MITI)
Capital interest subsidy forequipment thatusedrecycled resources (MITI)
Subsidy ofoverseas economic cooperative fee(MITI)
Subsidy ofcooperative business research anddevelopment expenses (MITI)
Subsidy expenses ofAsiaResearch Institute (MITI)
Subsidy forpromotion ofenvironment forindustrial redeployment (MITI)
Subsidy forpromotion offacilities forindustrial re-deployment (MITI)
Subsidy fortheimplementation andmaintenance ofadvanced applications (MITI)
Subsidy ofexpenses forindustrial usewaterways (MITI)
Subsidy ofexpenses forinternational jointresearch anddevelopment (MITI)
Subsidy ofnewenergy andmanufacturing technology research organization (MITI)
Subsidy ofunderground deeporenatural resource (MITI)
Subsidy ofraremetal stockpiling policy (MITI)
Subsidy ofguidance formedium andsmall sized companies (MITI)
Subsidy topromote dataofmedium andsmall businesses (MITI)
Subsidy topromote energy/environment compatibility ofmedium andsmall businesses (MITI)
Subsidy oftechnical guidance facilities (MITI)
Subsidy oftechnical research anddevelopment (MITI)
Subsidy fortechnical improvements (MITI)
Subsidy torevitalize regional technology (MITI)
Home financing corporation subsidy (Ministry ofConstruction, Ministry ofHome Affairs)
Subsidy ofinterest onleased housing construction forowners offarmland (Ministry ofConstruction,
Ministry ofHome Affairs)
Subsidy ofhousing andcitymaintenance public corporation (Ministry ofConstruction, Ministry of
Home Affairs)
Subsidy forpromoting themanufacture oftraditional craftproducts (MITI)
Subsidy ofsmall scale business guidance expenses (MITI)
Subsidy oforganizational guidance fee(MITI)
Subsidy ofmodernization offacilities formedium andsmall sized businesses (MITI)
Subsidy ofthepromotion ofassociated businesses (MITI)
Subsidy ofmedium andsmall commerce promotion policies (MITI)
Subsidy ofbasic business facilities andmaintenance (MITI)
Subsidy ofmedium andsmall sized business groups (MITI)
Subsidy oftrustguarantee association fund(MITI)
Subsidy ofinterest onregional medium andsmall sized business revitalization funds (MITI)
Silkthread andsugar price stabilization business group subsidy (MITI)
Forestry guidance subsidy (MITI)
Fishing industry regulatory committee subsidy (MITI)
Marine industry improvement subsidy (MITI)
Subsidy offishing industry mutual aidloaninterest payments (MITI)
Subsidy forthepromotion ofjointinternational aeroplane development (MITI)
Special subsidy ofshipbuilding loaninterest postponement (Ministry ofTransport)
Japan broadcasting association subsidy (Ministry ofPosts andTelecommunications)
Subsidy ofemployment transfer training (Ministry ofLabour)
Subsidy forguidance, supervision, etc.public housing construction (Ministry ofConstruction)
Subsidy forimproved guidance andsupervision ofhousing zones (Ministry ofHome Affairs)
Subsidy ofguidance andsupervision forleased housing construction byfarmlandowners, etc.(Ministry
ofHome Affairs)
Subsidy topromote suburb planning (Ministry ofHome Affairs)G/SCM/Q2/JPN/7
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People ’sFinance Corporation Grant (Ministry ofFinance)
Environment sanitation finance corporation grant (Ministry ofWelfare)
Farming modernization fundinterest subsidy (MITI)
Agriculture andfishing industry finance corporation subsidy (MITI)
Farmer ’spension fundsubsidy (MITI)
Forestry development public corporation subsidy (MITI)
Fisheries modernization fundinterest subsidy (MITI)
Agriculture andfishing industries trustfundsubsidy (MITI)
Interest subsidy offundfinancing forconstruction toprevent orepollution (MITI)
Industrial housing development interest subsidy (MITI)
Interest subsidy ofmedium andsmall sized company disaster restoration fund(Ministry ofTransport,
Ministry ofLabour)
Subsidy ofmedium andsmall sized company operations improvement fund(Ministry ofTransport,
Ministry ofLabour)
Medium andsmall sized company finance corporation subsidy (Ministry ofTransport)
Interest subsidy ofleasing lineandtransfer lineconstruction expenses (Ministry ofTransport)
Interest subsidy offinancing byhome owners toincrease worker assets (Ministry ofTransport)
Home finance corporation subsidy (Ministry ofConstruction)
Subsidy ofinterest onleased housing construction forowners offarmland (Ministry ofConstruction)
Subsidy ofhousing andcitymaintenance public corporation (Ministry ofConstruction)
Interest subsidy ofregulated share ofconstruction loans fornewurban manufacturing centres, etc.
(Ministry ofHome Affairs)
Publicly operated company finance corporation subsidy (Ministry ofHome Affairs)
From other sources:
Programmes oftheMinistry ofPost&Telecommunications:
NewInformation Flowback Promotion Centre
Municipal Fibre-Optic Programme
Telework Centre
PilotModel Project foraNewGeneration Communications Network
FullNetwork Support Programme
Sophisticated Image Communications Technology R&D Programme
Broad-Band Digital Communications Radio System R&D Programme
Three Dimensional High-Definition Television (HDTV) Programming Technology R&D
Programme
Programmes oftheMinistry ofInternational Trade &Industry:
Sophisticated Information Network Project
Multimedia Information Centre
Education Software Development andUtilization Centre
Model Electronic Library Project
High Speed Network Research
Geothermal Energy programme
Subsidies toJETRO (Japan External Trade Organization)
Subsidies totheCentre forDevelopment ofPower Supply Regions (CPR)
Subsidies toForeign Access Zones (FAZs)
PollutionControlProgramme-specificallytheSpecialDepreciationofCorporateIncomeTaxtoPromote
Installation ofEquipment forAnti-Pollution Measures (Ministry ofFinance)G/SCM/Q2/JPN/7
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Production andshipment ofmechanical tools -Themakers ofmechanical steeltools mayapply for
Employment Adjustment Subsidies, which aregranted tospecific industrial categories under
theEmployment Insurance lawtocopewiththelayoff ofworkers.
Subsidies tothepetrochemical sector (anestimated ¥36billion) tofacilitate “structural adjustment ”
plans, including theformation ofjointventures andalliances.
Subsidies topromote theproduction ofmelons inHokkaido. (In1993, melon growers reportedly
received ¥1billion insubsidies.)
Employment Subsidy Fund
Pacemaker subsidy -government financing ofabout 70percent ofthecapital fora$20million research
project todevelop aJapanese pacemaker.
"Sunshine" and"Moonlight" projects -concerned withdeveloping alternative energy sources, e.g.
solar power andenergy conservation. Arethefollowing programmes partoftheSunshine
andMoonlight projects?:
Development ofNewandPractical Technology forPower Generation (MITI)
Development ofResidential Rational UseofEnergy Systems (MITI)
Development ofPractical Technologies Related toEnergy Rational Use
Development ofPractical Technologies Related toOil-Substitute Energy (MITI)
“Large Scale Project ”-research anddevelopment ofnewtechnologies
Project onBasic Technologies forFuture Industries -developing innovative basic technologies inthe
areas ofsuperconductivity, newmaterials, biotechnology, electronics andsoftware
Micromachine Technology Project (added totheLarge-Scale Project in1991)
Financing forthePromotion ofIndustrial Technological Development Scheme -administered bythe
Japan Development Bank, provides concessional loansforthecommercialization ofimportant industrial
technologies. TheScheme alsocovers expenditure ontheconstruction ofbuildings foradvance basic
research.
LawonTemporary Measures forFacilitating Structural Adjustment, 87-96.
Facilitation Fund forIndustrial Structural Adjustment (FFISA) -Financial assistance forfacilitating
adjustment isprovided byconcessional loans, loanguarantees andequity capital infusions.
LawonExtraordinary Measures forStructural Improvement oftheTextile Industries -Introduced in
1989, theprogramme administered bytheTextile Industry Rationalization Agency hasaided
small tomedium textile producers tomodernize theirfacilities toupgrade quality andproductivity
(35projects were financed atacostof¥11.7 billion). Theprogramme wasreportedly settoexpire
in1994 -isthatthecase?
MechatronicsInvestmentPromotionTaxSystem-AssistancetoSMEsbywayofaccelerateddepreciation
provisions andtaxcredits.
Industrial Science andTechnology Frontier Programme (ISTF) -Initiated in1993, theprogramme
isbasicallyarestructuringofthreepreviousMITIprogrammes:theNationalR&Dprogramme;
R&D Project ofBasic Technologies forFuture Industries; andNational R&D Programmes
forMedical andWelfare Apparatus. Thisnewprogramme promotes fundamental andcreative
research anddevelopment forpurposes ofcontributing toconstruction offuture industry and
technology.
Subsidy toMitsubishi Heavy Industries forbuilding Bombardier ’sGlobal Express Business Jet
Subsidy toJapan Aircraft Development Corporation of$133.2 million forstartup ofBoeing 767
co-production incooperation withMitsubishi, Kawasaki, andFuji(International Aircraft
Development Fund -IADF).
MITI Research andDevelopment Subsidies totheBaseTechnology Research Promotion Centre in
thefollowing areas:
Large-surface thinpanel image display devices forcomputers
Optical photoengraving systems
Two-dimensional image sensors
Ultra-thin photocopying systems
Book-size computersG/SCM/Q2/JPN/7
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Optical Computers
Large-surface thin-film solar cells
Large-surface thin-profile flatlightsources
Large-surface precision glass substrate technology
Large-surfacehigh-fidelitythinfill,technology(ultrathinfilmforhigh-densityrecording
ofdigital sounds)
High functional liquid crystal materials technology
Large-surface precision assembly technology
Development expenditure subsidies forthecommercialization ofenergy-related technology
Research andDevelopment Association forFuture Electron Devices
Subsidization ofIntegrated CoalGasification Combined Cycle (ICGCC) power generation technology
bytheNewEnergy andIndustrial Technology Development Organization and,specifically,
theEngineering Research Association forIntegrated CoalGasification Combine Cycle Power
Systems
TheRealWorld Computing (RWC) programme
TheMicromachine Centre (MMC)
Financing fornewtechnology development
Taxdeduction forenergy/recycling research
Taxdeduction formedical research
Support forflatpanel displays
II. Questions onNotified Programmes
A. Could Japan provide additional information andclarification concerning theeligibility criteria
which mustbemetinorder tobenefit fromthe“Taxmeasures tostrengthen themanagement
ofsmall andmedium-sized corporation ”?
B. CouldJapanclarifyingreaterdetailtowhomandhowthesubsidyprogrammefor“Technopolis”
isprovided, e.g.what defines thecorporations engaged inthequalified high-technology
industries andwhat arethose industries? Please specify the“designated hightechnology
industrial development areas”referenced inthenotification?