G/SCM/Q2/CHN/121  
 
26 April 2023  
(23-2943) Page: 1/4 
Committee on Subsidies and Countervailing Measures  Original: English  
 
SUBSIDIES  
REPLIES TO FOLLOW -UP QUESTIONS POSED BY CANADA1 
TO REPLIES2 PROVIDED BY CHINA  
REGARDING THE 2021 NEW AND FULL NOTIFICATION OF CHINA3 
The following communication, dated and received on 25 April 202 3, is being circulated at the request 
of the delegation of  China . 
 
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I. Subsidies at the Central Government Level  
Question 1  
a. In response to Canada's question on Program 49 ( Special Fund for Foreign 
Economic and Trade Development ), China explains that the fund "shall not be 
contingent upon export performance". However, the response did not address the 
other question posed by Canada regarding this program. Please elaborate on t he 
sectors eligible for this program.  
Reply : 
The special fund for foreign economic and trade development does not target any specific sector. Its 
mandate covers guiding the coordinated and balanced development of import and export, improving 
inbound and ou tbound investment, and enhancing the public service system for foreign economic 
and trade development. All projects and enterprises within the coverage can apply for funding. The 
industries that have already received funding from this program include, but are not limited to, 
manufacturing, services, wholesale and retail sectors.  
b. China also explains that the "factor approach" to be used for the program "refers 
to the method of assigning weights or standards to relevant factors for fund 
allocation." What are the "relevant factors" to which China will assign "weights" 
for the purpose of allocating funding?  
Reply : 
The factors mainly include the development of foreign economic and trade, budget size and its 
implementation, fund management and use, and preference for underdeveloped regions.  
Question 2  
In response to Canada's question on how Program 69 ( Subsidy Fund for Fishery 
Development and the Scrapping, Dismantling and Renovating of Vessels)  intends to 
 
1 G/SCM/Q2/CHN/120.  
2 G/SCM/Q2/CHN/110 – Questions Posed by Canada; G/SCM/Q2/CHN/116 – Replies by China.  
3 G/SCM/N/372/CHN . G/SCM/Q2/CHN/121  
 
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  promote the sustainable development of distant w ater activities, China responded that 
the subsidy provided under the program is not limited to distant -water fishing.  
China's answer is not clear.  
a. Regarding the aspects of this subsidy program that are provided to distant water 
fishing vessels, how does this subsidy intend to "promote the sustainable and 
healthy development of distant water fishing"?  
Reply : 
Please refer to the 2021 notification of China regarding the " How the subsidy is provided" of Program 
69. The programme  aims at promoting the sustaina ble development of distant water fishing by 
improving the stability, safety, anti -pollution capabilities, and living conditions of distant water 
fishing vessels.  
b. Also, what activities must distant water fishing vessels be engaged in to be 
eligible for this  fund?  
Reply : 
Please refer to the 2021 notification of China regarding the "To whom the subsid y is provided" of 
Program 69. Subsidies at the Sub -Central Government Level  
II. Subsidies at the Sub -Central Government Level  
Question 3  
In response to Canada's question on Shanghai Municipality Program 9.1 ( Special Fund for 
Development of International Economy and Trade ), China directs Canada to refer to 
"Measures for the Use and Management of Special Fund for Foreign Economic and Trade 
Development of Sh anghai Municipality (H. Sh. C. [2016] No.207)" for more information 
regarding the program.  
While Canada appreciates that more information may be found in the legislation itself, 
Canada fails to see how directing a WTO member to a legislative measure (whic h is not in 
one of the official WTO languages) meets the transparency obligations of the subsidy 
notification review process.  
Therefore, Canada would like to obtain clarifications from China.  
a. Does the measure target specific sectors? If so, please elaborat e on the types of 
sectors eligible for this program.  
Reply : 
The measure does not target any specific sector.  Eligible enterprises may be in sectors including 
import or export business, foreign economic cooperation, and enterprises providing services for 
foreign trade.  
b. Does the measure include support for firms to export products to foreign 
markets?  
Reply : 
The goal of the measure is to improve the structure of foreign trade, promote foreign investment 
and cooperation, and enhance public services for foreign economic and trade development. It is not 
contingent upon the export performance of the enterprises concerned.  G/SCM/Q2/CHN/121  
 
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  Question 4  
In response to Canada's question on Shandong Province Program 15.2 ( Special Fund to 
Support the Development of Distant Water Fishing ), China states that the program "aims 
to encourage distant water fishing enterprises to invest in Rizhao, Shandong".  
Canada did not ask questions about the objective of the Program. Rather Canada asked 
what requirements must be met in order for an "enterpri se" to be considered eligible for 
a grant under this fund? Does the program support, among other things, the construction 
of new vessels? Canada would welcome answers to these questions.  
Reply : 
Circumstances that qualify for the subsidy include: supporting  fishing enterprises and fishermen in 
renovating and upgrading onboard equipments and facilities of fishing vessels , reduc ing the vessels ' 
energy consumption and pollutant discharge, improv ing vessels ' safety level, and upgrading the 
vessels by making them more automatic, intelligent and modern.  
Question 5  
The response to Canada's question on Xiamen City of Fujian Province Program 35.2 
(Special Fund for Marine and Fishery Development ) directs Canada to refer to the 
"Administrative Measures of Xiamen Municipality for the Special Fund for the 
Development of Marine Economy" for more information regarding the program.  
While Canada appreciates that more information may be found in the legislation itself, 
Canada fails to see how directing a WTO member to a legislative measure (which, in 
addition, is not in one of the official WTO languages) meets the transparency obligations 
of the subsidy notification review process. Therefore, Canada would like to obtain 
clarification as to:  
a. What does supporting the develo pment of distant -water fishing entail? Does that 
include an increase in fishing capacity?  
Reply : 
It mainly includes supporting the construction of fishery infrastructure, the development of marine 
health food, the construction of marine cold chain logistics, the development of new varieties of 
mariculture, the development of yachts, sailing exhibition s and competitions and other marine 
culture and sports industries, the cultivation of young talents, and the support system of marine 
industry , etc. It does not include subsidies to increase fishing capacity.  
 
b. What requirements must be met in order for an "enterprise" to be considered 
eligible for this program?  
Reply : 
According to the detailed provisions on the conditions and scope of support made in Chapter 2 of 
the Administrative Measures, funding applications are made on a year -round basis and reviewed 
periodically. The conditions for receiving subsidies for the development of marine health food are: 
the enterprise has developed and obtained the approval of the State Food and Drug Administration 
for marine health food or the approval of the National Healt h and Family Planning Commission for 
new food ingredients; the conditions for receiving subsidies for the construction of marine cold chain 
logistics are: the enterprises have been rated as national "AAA", "AAAA" or "AAAA" as cold chain 
logistics -based mar ine-related aquatic logistics enterprises; to obtain subsidies for the development 
of new species of mariculture: to obtain the new species of mariculture recognized by the Ministry 
of Agriculture; to host domestic and international large -scale exhibitions  of yacht and sailing boat 
according to industry norms, or to undertake national or international offshore sailing events can 
also receive corresponding subsidies.  G/SCM/Q2/CHN/121  
 
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  The recipients of funding for distant -water fishing projects are enterprises registered and established 
in the city after 17 September 2012, which undertake normal operation of the project and have not 
had any major safety accidents or major violations of the law in the past three years, and their 
distant -water fishing vessels included in the inv estment plan of the Ministry of Agriculture for the 
renewal and transformation of distant -water fishing vessels and new distant -water fishing vessels 
(including fishing auxiliary vessels) approved for construction by the Ministry of Agriculture before 
31 December 2015.  
 
 
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