WORLD TRADE  
ORGANIZATION  G/SCM/N/95/CZE 
22 March 2004 
 (04-1248) 
Committee on Subsidies and  
Countervailing Measures Original:   English 
 
 
SUBSIDIES  
 
New and Full Notification Pursuant to Article XVI:1  
of the GATT 1994 and Article 25 of the Agreement  
on Subsidies and Countervailing Measures  
 
CZECH REPUBLIC 
   The following communication, dated 17 March 2004, is being circulated at the request of the 
Delegation of the Czech Republic. 
 
_______________  
 
  With reference to Article XVI:1 of GATT 1994 and Article 25 of the Agreement on Subsidies 
and Countervailing Measures, I have the honour to enclose the Czech Republic's notification covering 
the years 2001 and 2002.   The notification of programmes and measures  does not prejudge their legal status under 
GATT 1994 or the Agreement on Subsidies and Countervailing Measures, nor does it prejudge the 
nature of the measure itself.  Furthermore, it do es not imply in any way that any of the measures 
notified, wholly or in part, constitutes a specific subsidy.  
TABLE OF CONTENTS 
Page
 
 
ENVIRONMENT ................................................................................................................... ..2 
ENERGY SAVING ................................................................................................................. .3 
RESEARCH AND DEVELOPMENT ...................................................................................4  
RESCUE AND RESTRUCTURING ......................................................................................5  
SMALL AND MEDIUM-SIZED ENTERPRISES ............................................................... 6  
INVESTMENT AID ................................................................................................................ 7 
MINING INDUSTRY ..............................................................................................................8  
REGIONAL AID .................................................................................................................. ...9 
TRANSPORT ..................................................................................................................... ....11  
AGRICULTURE ................................................................................................................... 12 
TOURISM ....................................................................................................................... .......13  
 
 Please note EUR 1  =  CZK 34.05360 (2001) 
   = CZK 30.81199 (2002) G/SCM/N/95/CZE 
Page 2  
 
  
ENVIRONMENT 
1.  Title of the subsidy 
 
 Environmental aid 
 
2.  Period covered by the notification 
 
 2001 - 2002 
 3.  Policy objective and/or purpose of the subsidy  
 Support for environmental protection and improvement. 
 
4.  Background and authority for the subsidy 
 
 Ministry of Environment and local authorities 
 
5.  Legislation under which it is granted 
 
 Act No. 388/1991 Coll. on State Environmental Fund   Act No. 218/2000 Coll. on Budgetary Regulations 
 
6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Grant 
 Loan (it means the uncollected interest amounting to 0.94 per cent of granted loans) 
 
7.  To whom and how the subsidy is provided 
 
 The subsidy is available to all companies i nvolved in the State Environmental Fund schemes 
on air protection, water protection, disposal of waste, projects in the area of ecological technologies 
and production etc. The Fund's expenditures are aime d at the municipality sphere, i.e. municipalities 
and cities. In the framework of the State Fund of  Environment there were in total 14 state aid 
schemes.  
 
 The decision to provide the subsidy is b ased on established criteria and assessment of 
applications with regard to the envir onmental benefits and public interests.  
 
8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy 
 
 The total amount of subsidy was CZK 21.7 million, (of which CZK 15.267 million in form of 
grants and CZK 6.433 million in form of soft loans) in 2001, and CZK 13.7 million (of which 
CZK 12.7 million in form of grants and CZK 1.0 million in form of soft loans) in 2002.  
 
9.  Duration of a subsidy and/or any other time limits attached to it 
 
 Maximum 10 years (loans).   G/SCM/N/95/CZE 
 Page 3 
 
 
 10.  Statistical data permitting an assessment of the trade effects of a subsidy 
 
 Not available.  
 
ENERGY SAVING 
1.  Title of the subsidy 
  Support of energy saving. 
 
2.  Period covered by the notification  
 2001 - 2002  3.  Policy objective and/or purpose of the subsidy 
  Promote energy savings and use of renewable energy sources. 
 
4.  Background and authority for the subsidy 
 
 Ministry of Industry and Trade  Ministry of Agriculture  5.  Legislation under which it is granted 
 
 Decision by the Government No.480/1998 on State Scheme for Energy Saving and Use of Renewable Energy Resources. 
 
 Act No. 218/2000 Coll. on Budgetary Regulations.  
 Agreement to the European Electric Power Chart, the Protocol on Energy Savings and 
Requirements for Permanently Sustainable Development. 
 
6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Grant  7.  To whom and how the subsidy is provided  
 Subsidy in the area of energy saving is implem ented by means of the State scheme for energy 
saving and use of renewable energy resources that includes sub-schemes  for higher use of renewable 
and secondary energy resources, for energy savings  in industry, transportation and agriculture, 
substitution of solid and liquid fossil fuels in hea ting hot utility water with use of biomass, for 
construction of small water power plants, wind pow er plants and facilities for joint production of 
electric power and heat from biomass.  
 
8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsid y 
  The total amount of subsidy was CZK 508.8 million in 2001 and CZK 31.4 million in 2002 
provided in form of grants. 
 G/SCM/N/95/CZE 
Page 4  
 
 9.  Duration of a subsidy  and/or any other time limits attached to it  
 
 Grants - specified in each contract.  10.  Statistical data permitting an assessment of the trade effects of a subsidy  
  Not available. 
 
 
RESEARCH AND DEVELOPMENT 
1.  Title of the subsidy 
 
 Support for research and development. 
 2.  Period covered by the notification 
 
 2001 - 2002 
 
3.  Policy objective and/or purpose of the subsidy  
 
 Promote research and development, in par ticular the projects related to technique and 
engineering. 
 
4.  Background and authority for the subsidy 
 
 Grant Agency that is a government agency administering support to R&D and acting upon supervision of the Government Council for Resear ch and Development. Support is also granted by 
respective ministries with in their competencies. 
 
5.  Legislation under which it is granted 
 
 Act No. 130/2002 Coll. on Aid for Research and Development   Act No. 218/2000 Coll. on Budgetary Regulations  6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Grant  
 Loan (it means the uncollected interest amoun ting to 7.75 per cent per cent of granted loans)  
 
7.  To whom and how the subsidy is provided 
  Most of financial funds for research and deve lopment were granted to the subjects dealing 
with technology and engineering projects. The funds were received by 240 and 165 beneficiaries for 
276 and 257 projects in years 2001 and 2002 respectively. 
  Conditions of application are decided by the Government, the subsidies are awarded 
through tender procedures. Under the Act No. 130/2002, aid is subject to the prior approval of the 
Office for the Protection of Competition of the Czech Republic. However, this c ondition does not 
relate to the aid for research and development project s awarded in form of a public contract, in which 
the aid beneficiary effects research and developmen t for the needs of the provider, who is the only 
user of its results. 
  G/SCM/N/95/CZE 
 Page 5 
 
 
 8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsid y 
 
 The total amount of subsidy was CZK 949.5 million in 2001, and CZK 1 106.4 million in 
2002. 
 
9.  Duration of a subsidy  and/or any other time limits attached to it 
  Generally not limited, specified in each contract. 
 
10.  Statistical data permitting an assessment of the trade effects of a subsidy 
 
 Not available. 
 
 
RESCUE AND RESTRUCTURING 
1.  Title of the subsidy 
 
 Rescue and restructuring of enterprises 
 
2.  Period covered by the notification 
  2001 - 2002 
 3.  Policy objective and/or purpose of the subsidy  
 Support to rescue and restructuring of enterprises, reaching maximum effectiveness of the enterprises’ activity, finding key parts of produc tion and consequently finding suitable strategic 
partner.  4.  Background and authority for the subsidy  
 Ministry of Industry and Trade  
5.  Legislation under which it is granted 
  Act No. 59/2000 Coll. on State Aid 
 Act No. 218/2000 Coll. on Budgetary Regulations 
 
6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Guarantee 
  Others (capitalisation of receivables, remission of payments prescribed by law, cession of 
receivables, etc.) 
 
7.  To whom and how the subsidy is provided 
  The subsidy was provided to the enterprises of  engineering, car industry and petrochemical 
industry. 
 G/SCM/N/95/CZE 
Page 6  
 
  All the measures are adopted on the basis of negotiations with all the interested entities 
(clients, creditors) and with regard to sensitive eco nomic, financial and social aspects. The aid has 
been assessed and approved by the Office for the Protection of Competition of the Czech Republic. 
 
8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy 
  The total amount of state aid was CZK 41.4  billion in 2001 and CZ K 90.3 billion in 2002. 
 
9.  Duration of a subsidy and/or any other time limits attached to it 
 
 Specified in each case, according to the maturity of guaranteed credits. 
 
10.  Statistical data permitting an assessment of the trade effects of a subsidy 
 
 Not available.   SMALL AND MEDIUM-SIZED ENTERPRISES 
1.  Title of the subsidy 
 
 Promotion of Small and Medium-Sized Enterprises 
 
2.  Period covered by the notification 
  2001-2002  
3.  Policy objective and/or purpose of the subsidy 
 
 Support of small and medium enterprises in structurally disadvantaged and economically 
weak regions, jobs creation  4.  Background and authority for the subsidy  
 Ministry of Industry and Trade  Ministry for Regional Development 
 
5.  Legislation under which it is granted 
 
 Act No. 47/2002 Coll. on the Promotion of Small and Medium-Sized Enterprises 
 Act No. 218/2000 Coll. on Budgetary Regulations 
 
6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Grant  Guarantee 
 Contribution to coverage of interests 
 Loan 
 
7.  To whom and how the subsidy is provided 
 
 Financial aid was provided to disadvantaged  regions (esp. due to the high level of 
unemployment) under the regional schemes and to th e enterprises under the schemes in gestion of the  G/SCM/N/95/CZE 
 Page 7 
 
 
 Ministry of Industry and Trade (e.g. consultancy and education services for small and medium-sized 
enterprises, non-banking credits for small enterprises)  
 The aid was provided by the Czechomor avian Guarantee and Development Bank 
(Českomoravská záru ční a rozvojová banka, a.s.) set up by the Decision of the Government. 
 8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy 
 
 The total amount of the subsidy was CZK 1 529.09 million (of which CZK 1 469.2 million in form of grants and CZK 59.89 million in form of  loans)in 2001, and CZK 1 926.2 million (of which 
CZK 493.8 million in form of grants, CZK 669.8 m illion in form of guarantees and guarantee price 
advantages, CZK 465.7 million for contribution to c over interests on credits and CZK 296.9 million in 
form of credits) in 2002. From the total amount  CZK 1 926.2 million, financial aid of CZK 302.9 
million was provided to regions in 2002. 
 
9.  Duration of a subsidy and/or any other time limits attached to it 
  Programmes are set up for the period 2001-2004. 
 10.  Statistical data permitting an assessment of the trade effects of a subsidy  
 Not available.  
 
INVESTMENT AID 
1.  Title of the subsidy 
 
 Aid for foreign and domestic investments  2.  Period covered by the notification  
 2001-2002 
 
3.  Policy objective and/or purpose of the subsidy 
  Support of creation new jobs, retraining of employees, development of industrial zones.  
 
4.  Background and authority for the subsidy 
 
 Ministry of Industry and Trade  Ministry of Finance 
 Ministry of Social Affairs  5.  Legislation under which it is granted  
 Act No.72/2000 Coll., on Investment Incentives, as amended by Act No. 453/2001 Coll. 
 Act No. 218/2000 Coll., on Budgetary Regulations  
 Decision by the Government No. 573 of 5 June  2002 (Creation of Fram ework Aid Scheme for 
Establishment and Expansion of  Technology Centres and Framew ork Aid Scheme for Strategic 
Services)  G/SCM/N/95/CZE 
Page 8  
 
 6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Grant  Others 
 
7.  To whom and how the subsidy is provided 
  2001 – Tax incentives were used by 11 compan ies, incentives for creation of new jobs and 
retraining were used by 12 companies. The aid in form of favoured investment conditions was drawn 
by 10 entities.  
 2002 – Tax incentives were used by 30 companies and incentives for creation of new jobs and 
retraining were used by 3 companies. Subsidy under this scheme is provided in harmony with decision of the Office for Protection of 
Competition of the Czech Republic.  
 
8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy 
 
 The total amount of aid provided for a suppor t of foreign and domestic investments was 
CZK 1 026.8 million (of which  CZK 911.1 million in form of investment incentives and CZK 115.7 
million in favoured sale of real estates) in 2001 and, CZK 2 085 million (of which CZK 1 921.8 million in form of investment in centives and CZK 163.2 million in form of favoured sale of real 
estates) in 2002. 
 
9.  Duration of a subsidy and/or any other time limits attached to it  
 Specified in each contract.  10.  Statistical data permitting an assessment of the trade effects of a subsidy  
 Not available. 
 
 MINING INDUSTRY 
1.  Title of the subsidy 
  Support for coal and ore mining 
 2.  Period covered by the notification  
 2001-2002  
3.  Policy objective and/or purpose of the subsidy 
  This subsidy has been established to cover th e costs stemming from structural adjustment in 
coal and ore mining activities and pr ogressive reduction of production.  
 
4.  Background and authority for the subsidy 
 
 Ministry of Industry and Trade 
  G/SCM/N/95/CZE 
 Page 9 
 
 
 5.  Legislation under which it is granted 
 
 Act No. 218/2000 Coll., on Budgetary Regulations  Act No. 44/1988 Coll., on Protection and Utilisation of Mineral Resources 
 
6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
  Grant  
7.  To whom and how the subsidy is provided 
  Companies engaged in coal and ore mining activities and covered by the government 
resolution and technical plan of liquidation of mining capacities, covering social-health costs, compensation of ecological damage a nd revitalization of environment. 
 
 Subsidy has to be approved by the Office for Protection of Competition of the Czech Republic. 
 
8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy. 
  2001 - The total amount of subsidy w as CZK 3 030.6 million, of which: 
 
  ∗CZK 2 557.4 million in form of non-investment grants, 
  ∗CZK    225.8 million in form of investment grants, 
∗CZK    247.4 million on redressing damage on environment caused by exploitation. 
 
 2002 – The total amount of subsidy was CZK 113.5 million, of which: 
 
∗CZK 105.5 million in form of non-investment grants, 
∗CZK     8.0 million on redressing damage on environment caused by exploitation.  
 
9.  Duration of a subsidy and/or any other time limits attached to it 
  Not limited, long-term character, based on the government plan of reduction of mining 
activities. 
 
10.  Statistical data permitting an assessment of the trade effects of a subsidy 
 
 Not available. 
  REGIONAL AID 
1.  Title of the subsidy 
 
 Aid for endangered regions and regional aid 
 
2.  Period covered by the notification 
  2001 - 2002 
 G/SCM/N/95/CZE 
Page 10  
 
 3.  Policy objective and/or purpose of the subsidy 
 
 Development of industrial business entities, restructuring within the sectoral operation scheme in industry, development of human resource s in industry, support of creation of new jobs  
 
4.  Background and authority for the subsidy 
 
 Ministry for Regional Development 
 Ministry of Trade and Industry 
 
5.  Legislation under which it is granted 
  Act No. 248/2000 Coll., on Support of Regional Development 
 Act No. 218/2000 Coll., on Budgetary Regulations 
 
6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
  Grant (not exceeding 50 per cent of the total budget investment project costs). 
 
7.  To whom and how the subsidy is provided 
 
 The aid was provided under the following schemes:   
 (1) “Regional Aid Scheme for Development of Industrial Business Entities on the Territory of 
NUTS 2 North -West and Ostravsko”. Under this schem e aid was granted to 53 and 20 beneficiaries 
in 2001 and 2002 respectively. 
  (2) “Sectorial Operation Scheme for Years 2001- 2006 – Industry” Under this scheme aid was 
provided to 97 beneficiaries in 112 projects and, 44 beneficiaries in 45 projects in 2001 and 2002 
respectively.   
 (3) “Fund of Investments in Production Sector ”. This scheme, aimed on small and medium-
sized enterprises was applicable for the period 2002 – October 2003.  
 Conditions for the application were set up by the Government Decisions and subsidies were 
awarded through tender procedures.  8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy 
 
 The total amount of subsidy was CZK 628.8 million (of which CZK 424.6 million under 
regional aid scheme and CZK 202.2 million under Sect orial operation scheme in  Industry) in 2001, 
and CZK 560 million (of which CZK 135.4 million under to the regional aid scheme, CZK 97.9 
million under Sectorial operation scheme in Indus try, and CZK 326.7 million under the scheme of 
investments in production sector) in 2002. 
  
9.  Duration of a subsidy and/or any other time limits attached to it 
 
 Not limited, by a single application. 
 
10.  Statistical data permitting an assessment of the trade effects of a subsidy 
  Not available. 
  G/SCM/N/95/CZE 
 Page 11 
 
 
  
TRANSPORT 
1.  Title of the subsidy 
 
 Support for Transport Organisations 
 2.  Period covered by the notification  
 2001 - 2002  
3.  Policy objective and/or purpose of the subsidy 
 
 Support for the railway and road transpor t to cover operating losses resulting from public 
transport’s operation, revitalisation of car park, development of combined transport. 
 4.  Background and authority for the subsidy  
 Ministry of Transport  
5.  Legislation under which it is granted 
 
 Act No. 111/1994 on Road Transport 
 Act No. 266/1994 on Railway Service  
 Decision by the Government No. 632/2000 on Re vitalisation of Car Fleet of City Transport 
and Public Transport 
 
 Act No. 218/2000 Coll. on Budgetary Regulations   6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Grant  Guarantee 
 
7.  To whom and how the subsidy is provided 
  The subsidy is provided to the state railway  and private railroads companies within the 
schemes “Personal Railroad Transport” and “Aid for Development of Pick-a-Back Transport”. 
 
 Conditions of application are decided by the G overnment, subsidy has to be approved by the 
Office for Protection of Competition of the Czech Republic. 
 
8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy 
 
 The total amount of the subsidy was CZK 646.6 million (of which CZK 583.7 million in form 
of grants and CZK 62.9 million in form of state guarantee for a bank credit) in 2001 and, 4 811 
million (of which CZK 4 702.3 million in form of non-investment grant, and CZK 108.7 million in 
form of a state guarantee for a bank credit) in 2002. 
 
9.  Duration of a subsidy and/or any other time limits attached to it 
 
 Programmes are set up for the period 2001-2003. G/SCM/N/95/CZE 
Page 12  
 
  
10.  Statistical data permitting an assessment of the trade effects of a subsidy 
 
Not available. 
 
 AGRICULTURE 
1.  Title of the subsidy 
 
 Support for Agriculture. 
 
2.  Period covered by the notification 
 
 2001 - 2002 
 
3.  Policy objective and/or purpose of the subsidy 
  Support producers in disadvantaged regions, rest ructuring of production, reduce arable land in 
less-favoured areas, ensure the safety of imported products 
 
4.  Background and authority for the subsidy 
 
 Ministry of Agriculture 
 5.  Legislation under which it is granted  
 Act No. 252/1997 Coll. on Agriculture  
 Government Regulation No 505/2000 Coll. on Support of Non-production Functions of 
Agriculture.   
 
 Government Regulation No 86/2001 Coll. on Conditions for Fixed-Area   
 Act No. 218/2000 Coll. on Budgetary Regulations  
  Decision by the Government Establishing the Farming and Forestry Support and Guarantee 
Fund (PGRLF) 
 
6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Grant  Loan 
 
7.  To whom and how the subsidy is provided 
  The support is provided to farmers within  the Product-specific and Non-product-specific 
AMS (Aggregate Measurements of Support), under th e Set-Aside Programmes and within the “Green 
Box”(domestic food aid, relief from natural dis asters, retirement programmes, environmental 
programmes, etc.).   G/SCM/N/95/CZE 
 Page 13 
 
 
 8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy 
  The total amount of the subsidy (million CZK)  2001  2002 
∗AMS       5 495.9  4 812.9 
∗Green Box      8 150.5  5 156.1 
∗Set-Aside Programmes        613.1     787.8 
 9.  Duration of a subsidy and/or any other time limits attached to it  
 Individually, according to the programme.  
10.  Statistical data permitting an assessment of the trade effects of a subsidy 
  Not available.  
  TOURISM 
1.  Title of the subsidy 
 
 Support for the area of tourism 
 
2.  Period covered by the notification 
  2001 - 2002 
 3.  Policy objective and/or purpose of the subsidy  
 Development of small and medium enterprises in the area of tourism, creation of new jobs, creation of new and regional tourism products , increase and more quality propagation and 
informedness on the Czech Republic abroad. 
 
4.  Background and authority for the subsidy 
 
 Ministry for Regional Development 
 
5.  Legislation under which it is granted 
 
 Decision by the Government No. 682/2000 on Strategy of Regional Development of the 
Czech Republic 
 
 Act No. 218/2000 Coll. on Budgetary Regulations   6.  Form of the subsidy (i.e. gr ant, loan, tax concessions, etc.) 
 
 Grant  
7.  To whom and how the subsidy is provided 
 
 Aid is provided from the state budget in the fra mework of sub schemes “Aid for Owners of 
Spa Infrastructure” and “Aid for Construction of Additional Tourism Infrastructure for Sport and 
Leisure Activities”. G/SCM/N/95/CZE 
Page 14  
 
  
8.  Subsidy per unit, or in cases where it is not possible, the total amount or the annual 
budgeted for that subsidy 
 
 The total amount of the subsidy was  CZ K 122.9 million in 2001 and CZK 185.5 million in 
2002. 
 
9.  Duration of a subsidy and/or any other time limits attached to it 
  The state aid scheme for tourism has been implemented since 2001. 
 10.  Statistical data permitting an assessment of the trade effects of a subsidy  
 Not available.  
 
__________