G/SCM/Q2/CHN/105  
 
27 January 2022  
(22-0705) Page: 1/2 
Committee on Subsidies and Countervailing Measures  Original: English  
 
 
SUBSIDIES  
QUESTIONS POSED BY THE UNITED KINGDOM  REGARDING  
THE NEW AND FULL NOTIFICATION OF CHINA1 
The following communication, dated and received on 24 January 2022 , is being circulated at the 
request of the delegation of the United Kingdom . 
 
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The U nited Kingdom  thanks China for its efforts in submitting its 2021 subsidy notification. The 
United Kingdom  believes that the sharing of information is in the interest of all Members and is 
essential for the effective functioning of the SCM Agreement. We would therefore be grateful for any 
information China can provide on the following questions.  
 
Preferential tax policies for high -tech enterprises  
 
1. What sectors are eligible for this subsidy?  
 
2. Is this subsidy available to foreign -invested enterprises or only to Chinese -owned 
enterprises?  
 
Preferential tax treatment for energy -saving and new energy vehicles and vessels  
 
3. Which types of energy -saving and new energy vehicles and vessels are eligible for this 
subsidy?  
 
4. Are vehicles and vessels manufactured outside China eligible for this subsidy?  
 
Preferential tax policies for Clean Development Mechanism  
 
5. Which sectors are eligible for this  subsidy?  
 
Preferential tax policies for integrated circuit industry  
 
6. What are "projects encouraged by the state" in the integrated circuit industry?  
 
7. How many enterprises are designated as "key integrated circuit designing enterprises 
encouraged by the St ate"? 
 
Preferential VAT for large passenger aircraft and new regional aircraft  
 
8. Are foreign -owned businesses eligible for this subsidy ? 
 
9. What was the total number of businesses that received this subsidy during this notification 
period?  
 
 
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  10. How many aircraft have been produced with the support of this subsidy?  
 
Preferential tax treatment on the house property tax and urban land use tax of enterprises 
engaged in capacity reduction and structural adjustment  
 
11. Which sectors are targeted for capacity reduc tion and structural adjustment through this 
subsidy?  
 
12. How were target enterprises for suspension of production identified?  
 
13. How was capacity reduction and structural adjustment monitored?  
 
14. What was the total capacity reduction achieved through this scheme in each of the eligible 
industries?  
 
General questions  
 
15. Could China please provide any available data on subsidy amounts for the preferential tax 
policies included in the notification?  
 
16. Is China 's position that: (a) state -owned banks did not provide any preferential lending to 
state-owned enterprises during the notification period; or (b) all lending by state -owned 
banks is outside the scope of this notification? If (b), why?  
 
17. Does China consider all activities of government guidance funds to be outside the scope of 
this notification? If so, could China please explain the reasons for its assessment that these 
funds do not constitute any of the following under Article 1.1(a)(1) of the Agreement on 
Subsi dies and Countervailing Measures:  
a. A public body which provides financial contributions; or  
b. A funding mechanism which receives contributions from the government; or  
c. A private body entrusted or directed by government to carry out one or more of the 
types o f functions illustrated in Article 1.1(a)(i -iii). 
 
 
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