G/SCM/N/284/EU/Add.3  
 
10 August 2015  
(15-4100)  Page: 1/8  
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 
EUROPEAN UNION 
Addendum 
The following addendum to the notification of the European Union relates to subsidy programmes 
of Bulgaria . 
 
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 G/SCM/N/284/EU/Add.3 
 
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  BULGARIA  
 
 
TABLE OF CONTENTS 
1   INNOVATION FUNDING ............................................................................................... 3  
2   ASSISTANCE TO ECONOMIC DEVELO PMENT AND STRUCTURAL ADJUSTMENT ............. 3  
2.1   Support to Regi onal Development ................................................................................ 3  
2.2   Support to Regi onal Development ................................................................................ 4  
3   OPERATIONAL PROGRAMME "DEVELOPMENT OF THE COMPETITIVENESS OF 
THE BULGARIAN ECON OMY 2007- 2013" .......................................................................... 5  
4   FILM INDUSTRY SUPPORT ........................................................................................... 7  
 
 G/SCM/N/284/EU/Add.3 
 
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  1  INNOVATION FUNDING 
1. Title of the subsidy programme 
 
Scheme for support of innovative undertaking s through the National Innovation Fund.  
 
2. Period covered by the notification 
 
2013; 2014. 
 3. Policy objective and/or purpose of the subsidy 
 
The scheme provides support for research and develo pment activities of the enterprises working in 
collaboration with research organizations.  
4. Background and authority for the subsidy (incl. identification of the legislation under which it 
is granted) 
 - Council of Ministers' Decision No. 723 of 8 September 2004 for Adoption of Innovation Strategy 
of the Republic of Bulgaria and Measures for its Implementation, as amended by Council of 
Ministers' Decision No. 385 of 22 May 2006; 
- Council of Ministers' Decree No. 15 of 31 January 2005 for Providing Funds from 2005 State 
Budget to the Ministry of Economy for the establishment of National Innovation Fund (NIF); 
- NIF Management Rules and Guidance on Application for Funding of Innovative 
Enterprises, approved by Order No. RD-16-82/2005, Order No. RD-16-464/2005 and Order 
No. RD-16-1402/2006, issued by the Minister of Economy (with amendments). 
 Authority responsible for the subsidy: Small an d Medium Enterprises Promotion Agency at the 
Ministry of Economy. 
 5. Form of the subsidy 
 
Grant. 
 6. To whom and how the subsidy is provided 
 The grant is provided to innovative enterprises from all sectors and regions, research institutes, organizations and universities for support of research activities. 
 
7. Subsidy per unit or in case where it is not possible, the total amount or the annual budgeted 
for that subsidy 
 
In 2013 - payments effectuated at the amount of BGN 0.075 million. 
In 2014 - payments effectuated at the amount of BGN 1.649 million.   
8. Duration of a subsidy and/or any other time limits attached to it 
 
2009-2013, and a prolongation till 30 June 2014, based on a GBER 800/2008 prolongation with 
Regulation 1224/20013.  
 9. Statistical data permitting an assessment of the trade effects of the subsidy 
 
Statistical data permitting an assessment of the trade effects of the subsidy is not available. 
 2  ASSISTANCE TO ECONOMIC DEVELOPMENT AND STRUCTURAL ADJUSTMENT 
2.1  Support to Regional Development 
1. Title of the subsidy programme 
 
Scheme for tax relief constituting regional aid, subject to fulfilment of the conditions under 
Art. 184 (linked to Art. 189) of the Corporate Income Tax Act (CITA). G/SCM/N/284/EU/Add.3 
 
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  2. Period covered by the notification 
 
2013; the measure expired on 31 December 2013.   
3. Policy objective and/or purpose of the subsidy 
 
Regional aid for initial investment and jobs creation linked to the investment. 
 
4. Background and authority for the subsidy (incl. identification of the legislation under which it 
is granted) 
 
- Corporate Income Taxation Act, promulgated, State Gazette (SG) No. 105 of 
22 December 2006, as last amended and supplemented, SG No. 109 of 20 December 2013.  
 
In accordance with Article 189 of the Corporate Income Taxation Act (CITA) the taxable persons 
must fulfill specified conditions in order to receive regional aid related to the initial investment in municipalities with rate of unemployment for the year of retention 35% or higher than the national 
average for the same period. 
 Authority responsible for the subsidy: National Revenue Agency at the Ministry of Finance.  
5. Form of the subsidy 
 
Tax relief. 
 
6. To whom and how the subsidy is provided 
 
Any taxable person fulfilling the conditions specified under Article 184 (linked to Art. 189) of CITA 
can retain corporate tax and is obliged to invest it in material and immaterial assets as a part of his initial investment. The initial investment has to be made in municipalities where the rate of unemployment for the year of retention is 35% or higher than the national average for the same 
period. The activity related to the initial investment shall be implemented in the respective 
municipality for at least 5 years after the year of completion of the initial investment and this circumstance is to be declared annually by the annual tax returns until the lapse of the five-year 
period. At least 25% of the value of the material and immaterial assets forming part of the initial 
investment must be self-financed or debt-financed by the taxable person.   
7. Subsidy per unit or in case where it is not possible, the total amount or the annual budgeted 
for that subsidy 
 
In 2013 - BGN 14.359 million. 
In 2014 – not applicable. 
 8. Duration of a subsidy and/or any other time limits attached to it 
 1 July 2007 – 31 December 2013.  
9.  Statistical data permitting an assessment of the trade effects of the subsidy 
 
Trade effects are assessed as minimal.  
2.2  Support to Regional Development 
1. Title of the subsidy programme 
 
Investment promotion with regional aid for investment and job creation under Investment 
Promotion Act.   
2. Period covered by the notification 
 
2013; 2014.  G/SCM/N/284/EU/Add.3 
 
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  3. Policy objective and/or purpose of the subsidy 
 
The measure consists of regional aid for initial investment and jobs creation linked to the investment. Investment promotion under the scheme aims to  increase the investment for 
technological development of high-value-added manuf acturing and services, and creation of highly 
productive jobs; decrease of regional disparities in the social and economic development.  
4. Background and authority for the subsidy (incl. identification of the legislation under which it 
is granted) 
 
- Investment Promotion Act – promulgated, State Gazette (SG) No. 97 of 24 October 1997, as 
last amended and supplemented, SG No. 98 of 28 November 2014; 
- Rules for Implementation of the Investment Promotion Act – promulgated, SG No. 76 of 
21 September 2007, as last amended and supplemented, SG No. 94 of 24 November 2014. 
 
Authority responsible for the subsidy: Ministry of economy.   
5. Form of the subsidy 
 
Subsidy, other.  
6. To whom and how the subsidy is provided 
 
The beneficiaries are SMEs and big companies. The subsidy covers the implementation and 
maintaining of investment projects of national  importance. Projects must meet the minimum 
requirements regarding the amount of investment and employment to be created, as stated in the Rules for Implementation of the Investment Promotion Act.  
 
Priority Investment Projects under the measure can be promoted with the provision of grants:   
- up to 50% of the cost for investment in education and scientific research; 
- up to 10% of the cost for investment in the processing industry. 
 7. Subsidy per unit or in case where it is not possible, the total amount or the annual budgeted 
for that subsidy 
 In 2013 - no payment. 
In 2014 - BGN 1.392 million.  
 8. Duration of a subsidy and/or any other time limits attached to it 
 
1 May 2009 – 31 December 2013, and a prolongation till 30 June 2014, based on a 
GBER 800/2008 prolongation with Regulation 1224/20013.  
9. Statistical data permitting an assessment of the trade effects of the subsidy  
 
Trade effects are assessed as minimal. 
 
3  OPERATIONAL PROGRAMME "DEVELOPMENT OF THE COMPETITIVENESS OF THE BULGARIAN ECONOMY 2007-2013" 
1. Title of the subsidy programme 
 
Priority axis 2 "Increasing Efficiency of Enterprises and Promoting Supportive Business Environment" and the following schemes: "Technol ogical Modernization of Enterprises" (case 
XS299/2007, case X359/2010, case X262/2010), "Upgrade of Technologies in Large Enterprises" 
(case X 73/2008, case SA.26923), "Implementation of Innovations in Enterprises" (case SA.36725), "Technical Modernization of SMEs" (case X216/2010, case SA 32204, case SA.33710). 
 
2. Period covered by the notification  
 2013; 2014. G/SCM/N/284/EU/Add.3 
 
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  3. Policy objective and/or purpose of the subsidy 
 
Primary objective – technological upgrade of enterprises. Secondary objective – support of enterprises. 
 
4. Background and authority for the subsidy (incl. identification of the legislation under which it 
is granted) 
 EU legislation:  - Council Regulations (EC) No. 1080/2006, No. 1081/2006, No. 1082/2006; No. 1083/2006 (with 
amendments); No. 1084/2006;  
- Commission Regulations (EC) No. 1828/2006; No. 800/2008; No. 846/2009. 
 
Bulgarian legislation: 
 - 2013 or 2014 State Budget of the Republic of Bulgaria Act; 
- Council of Ministers' Decree No 1 of 9 Janua ry 2013 on the Implementation of the 2013 State 
Budget of the Republic of Bulgaria, promulgated,  State Gazette (SG) No. 6 of 22 January 2013;  
- Council of Ministers' Decree No 3 of 15 Janua ry 2014 on the Implementation of the 2014 State 
Budget of the Republic of Bulgaria, prom ulgated, SG No. 8 of 28 January 2014;  
- Council of Ministers' Decree No. 121/2007 on Determining the Procedure on Grant Awarding 
under the Operational Programmes, co-financed from the Structural Funds and the Cohesion Fund, and under the PHARE Programme of the Eu ropean Union; promulgated, SG No. 45 of 
2007, as amended;  
- Council of Ministers' Ordinance No. 18 of 4 February 2003 on Establishing a Council for the Co-
ordination of Combating Against Irregularities Concerning the Financial Interests of the EU; 
promulgated, SG No. 13 of 11 February 2003, as amended;  
- Council of Ministers' Ordinance on Determination of Procedures for Administering of 
Irregularities Concerning Funds and Programme s, Co-financed from the EU; promulgated, 
SG No. 97 of 8 December 2009, as amended;  
- Council of Ministers' Decree No. 202 of 13 August 2009 on Establishing a Co-ordination 
Mechanism for Management of EU Funds, promulgated, SG No. 67 of 21 August 2009;  
- Small and Medium-Size Enterprises Act, promulga ted, SG No 84 of 24 September1999, as last 
amended and supplemented, SG No. 82 of 16 October 2009;  
- Public Procurement Act, promulgated, SG No. 28 of 6 April 2004, as last amended and 
supplemented, SG No. 40 of 13 May 2014. 
 
5. Form of the subsidy 
 Grant. 
 
6. To whom and how the subsidy is provided 
 
Granting authority is Ministry of Economy. Aid is granted to beneficiaries (selected after fulfilment 
of rules and procedure previewed under the Operat ional program) from the manufacturing industry 
and activities related to the nanotechnology; 85% co-financing from the European Regional 
Development Fund (EFRD) and 15% co-financing from the state budget of the Republic of 
Bulgaria.  7. Subsidy per unit, or in case where it is not possible, the total amount or the annual 
budgeted for that subsidy 
 In 2013:  
 
- under case XS 299/2007 – payments effectuated at the amount of BGN 0.117 million co-
financing from Bulgaria; 
- under case X 73/2008, case SA.26923 – no payment; 
- under the case X359/2010, case X262/2010 – payments effectuated at the amount of 
BGN 4.385 million co-financing from Bulgaria; 
- under case X 216/2010 – payments effectuated at the amount of BGN 2.332 million co-
financing from Bulgaria; G/SCM/N/284/EU/Add.3 
 
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  - under case SA.32204 – payments effectuated at the amount of BGN 9.354 million co-financing 
from Bulgaria; 
- under case SA.33710 – payments effectuated at the amount of BGN 14.847 million co-financing 
from Bulgaria; 
- under case SA.36725 –no payment. 
 In 2014: 
 
- under case XS 299/2007 –no payment; 
- under case X 73/2008, case SA.26923 – no payment; 
- under the case X359/2010, case X262/2010 – payments effectuated at the amount of 
BGN 0.213 million co-financing from Bulgaria; 
- under case X 216/2010 – payments effectuated at the amount of BGN 0.179 million co-
financing from Bulgaria; 
- under case SA.32204 – payments effectuated at the amount of BGN 0.383 million co-financing 
from Bulgaria; 
- under case SA.33710 – payments effectuated at the amount of BGN 13.840 million co-financing 
from Bulgaria; 
- under case SA.36725 – payments effectuated at the amount of BGN 4.220 million co-financing 
from Bulgaria. 
 
8. Duration of a subsidy and/or any other time limits attached to it 
 
The terms are specified in the Guidance for application for granting financial aid under the 
Operational program and defers for each measure.   
 9. Statistical data permitting an assessment of the trade effects of the subsidy 
 In view of the purpose of the subsidy trade effects are assessed as minimal.  4  FILM INDUSTRY SUPPORT 
1. Title of the subsidy 
 
Bulgarian Film Industry support. 
 
2. Period covered by the notification 
 
2013; 2014. 
 3. Policy objective and/or purpose of the subsidy 
 
The aid is aimed at supporting the development and preservation of the Bulgarian film culture. The 
main priorities are the following: assistance in the production and distribution of films of high 
artistic merit and debut film projects; ensuring th e right of public access to various forms of film-
related creative work; protection of the rights an d interests of audience; support to the new talent 
and young writers; domestic and international promotion of Bulgarian films.  
4. Background and authority for the subsidy (incl. identification of the legislation under which it 
is granted) 
 
- Law on Film Industry – promulgated, State Gazette (SG) No. 105 of 2 December 2003, as last 
amended and supplemented, SG No. 68 of 2 August 2013;  
- Rules of Procedure of the National Film Centre Executive Agency ; 
- Protection and Development of Culture Act – prom ulgated, SG No. 50 of 1 June 1999, as last 
amended and supplemented, SG No. 68 of 2 August 2013; 
- 2013 or 2014 State Budget of the Republic of Bulgaria Act;  
- Council of Ministers' Decree No 1 of 9 Janua ry 2013 on the Implementation of the 2013 State 
Budget of the Republic of Bulgaria, promulgated,  State Gazette (SG) No. 6 of 22 January 2013;  
- Council of Ministers' Decree No 3 of 15 Janua ry 2014 on the Implementation of the 2014 State 
Budget of the Republic of Bulgaria, prom ulgated, SG No. 8 of 28 January 2014.  G/SCM/N/284/EU/Add.3 
 
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  Granting authority is the National Film Centre Ex ecutive Agency (NFCEA). In line with the Law on 
the Film Industry, the Agency is a second-level budg etary spending unit of the Ministry of Culture. 
The transfer of funds from the budget of the Mi nistry of Culture to the NFCEA is determined 
annually under the state budget act for the respective year. 
 
5. Form of the subsidy 
 
Grant. 
 6. To whom and how the subsidy is provided 
 
The beneficiaries are film production, distribution and promotion companies. Support may be 
provided to Bulgarian films associated with national displays and commemorations of events and notable historical figures, as well as debut films. The aid is not reserved exclusively for nationals 
and is provided regardless of the beneficiary's nationality or place of residence. 
 7. Subsidy per unit, or in case where it is not possible, the total amount or the annual 
budgeted for that subsidy 
 In 2013 – contracts concluded at the amount of BGN 12.7 million.  In 2014 – contracts concluded at the amount of BGN 11.917 million. 
 
8. Duration of a subsidy and/or any other time limits attached to it 
 
1 January 2010 – 31 December 2017. 
 9. Statistical data permitting an assessment of the trade effects of the subsidy 
 It is considered that the trade effects are minimal.    
 
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