G/SCM/Q2/EU/38
23 October 2014
(14-6125)  Page: 1/5
Committee on Subsidies and Countervailing Measures  Original: English
 
SUBSIDIES 
REPLIES TO QUESTIONS POSED BY THE UNITED STATES1 REGARDING THE NEW 
AND FULL NOTIFICATION OF THE EUROPEAN UNION2 
The following communication, dated 17 October 2014, is being circulated at the request of the 
Delegation of the European Union.  
_______________ 
  European Fisheries Fund 
 
• Please explain whether and to what exte nt this program assists Member States' 
efforts to address overcapacity and overfishing in the industry. 
 
Reply 
 
Since 2007, the European Fisheries Fund has supported the EU's Common Fisheries Policy in 
helping to promote an exploitation of living aquatic resources and support aquaculture which provides sustainability in economic, environmental and social terms and at promoting a sustainable balance between resources and the fi shing capacity of the Community fishing fleet. 
 
Within the European Fisheries Fund, the main tool  to help address that overcapacity is public 
support for the permanent cessation of fishing operations mainly by scrapping of vessels. As of 
31 May 2014, the European Fisheries Fund has helped to finance the scrapping of over 
4,000 vessels in the EU fleet, at a total pu blic cost of EUR 898.58 million, of which 
EUR 527.03 million funded by the EU  and EUR 371.55 million funded by  national public resources. 
The scrapping of vessels in most cases is fully fina nced by public, i.e. national plus EU resources. 
 Successive evaluations, including a recent study financed by the Commission
3 on permanent and 
temporary cessation measures in the EFF have cast doubts on the effectiveness and efficiency of 
permanent cessation in addressing overcapacity. The 2013 study concluded that in many cases 
permanent cessation has been used as a means to improve economic efficiency and in some cases, even to modernise fleets. It also indicated that most Member States consider that the 
restructuring of their fleets as mostly completed. 
 For these reasons, the European Maritime and Fisheries Fund (EMFF), the structural support tool 
for the CFP in the period 2014-2020, restricts EU public support for permanent cessation. In 
particular, permanent cessation can only be used to balance fleet segments that Member States consider to be suffering from overcapacity. There is also a national cap and a time limit for the use of permanent cessation (not later than 31.12.2017).
 
 
                                               
1 G/SCM/Q2/EU/35.   
2 G/SCM/N/253/EU, G/SCM/N/253/EU/Add.6, G/SCM/N/253/EU/Add.9, G/SCM/N/253/EU/Add.14, 
G/SCM/N/253/EU/Add.19. 
3 Retrospective Evaluation of Scra pping and Temporary Cessation Meas ures in the EFF, MRAG report 
commissioned by the European Commission, Final Report, November 2013.   G/SCM/Q2/EU/38 
 
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  • Please explain recent or ongoing changes to  the EFF. What is the expected life of 
this program? Are there any plans to reduce funding under the EFF?  
 Reply 
 From 1 January 2014, the new European Maritime and Fisheries Fund was established to replace the European Fisheries Fund for the 2014-2020 period.
4 Member States can continue to use 
unspent EFF funds until 31 December 2015. 
 The new EMFF significantly limits fleet measures. Instead it focusses on supporting environmental sustainability, on innovation as a tool to help bring about more sustainable and cost-effective 
fishing practices and on further developing the aquaculture and processing sectors. The socio-
economic development of coastal communities, as well as improved scientific data collection and enforcing fisheries control are other fundamental priorities of the EMFF. 
 
For the 2014-2020 period, the European Maritime and Fisheries Fund has a total budget of EUR 6.39 billion, of which EUR 4.34 billion is earmarked for the sustainable development of 
fisheries, aquaculture and fisheries areas, to ma rketing and processing-related measures and to 
technical assistance. Nearly 10% of the EMFF, or EUR 580 million, has been earmarked for fisheries control and enforcement measures while a further EUR 520 million has been earmarked to improved scientific data collection. 
 
• A number of EU Member State notification s provided information regarding support 
for the fisheries sectors, including De nmark, Ireland, Lithuania, Spain and 
Sweden. Some of the programs reported by those countries appear to be funded 
by the EU's EFF while other funding appears to come directly from the 
Member States. Could the EU please expl ain whether the lack of any reporting 
regarding funding provided by Member St ates for the fisheries sectors indicates 
that these Member States do not provide an y such funding? Alternatively, if such 
Member State funding for the fisheries se ctors does exist, could the EU please 
explain why those Members States did not report it? 
 
Reply 
 
As indicated in the reply to Question 1, the publ ic part of investments supported by the EFF also 
includes national public resources. Thus, EU financial support is co-funded by national resources. However, Member States can also opt for financing additional measures without EU funding and 
rely solely on national public resources. However, many do not do so, which may explain why, in 
certain cases, they have nothing to report.  Denmark 
 9.1 Restructuring of the Fishing Fleet  
• Denmark reported that the period of th e program is 2009-2010 but also reported 
funding for the reporting period 2011-2012. What is the duration of this program?  
 
Reply 
 The reported period of the program refers to  the period of committed funds. Some of the 
committed funds were disbursed in 2011 and 2012 thou gh, explaining the reported activity also in 
this time period.  
                                               
4 Regulation (EU) No 508/2014 of the European Parliament and of the Council of 15 May 2014 on the 
European Maritime and Fisheries Fund. OJ L 149/1 of 20.05.2014. G/SCM/Q2/EU/38 
 
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  Germany 
 
Questions regarding notified programs: 
 
4. Joint Task on "Improving the Regional Economic Structure" 
 
• Please explain if the budget allocations granted to promote commercial and 
industrial investments, as reported in th e notification, represent allocations from 
the Bund, Länder or both.  
 Reply 
 Projects in trade/industry, industry-based infrastructure measures and certain non-investive measures (regional management, cooperation ne tworks and cluster management, integrated 
regional development schemes, aid for planning  and advisory services, regional budget, 
experimentation clause) may receive assistance with budget funds from the Joint Federal Government/Federal State Scheme for the Improvement of Regional Economic Structures 
(referred to as Joint Task Scheme funding below). Thereby, projects funded by Joint Task Scheme 
are financed 50:50 by the federal government and the state in question.  
• What are the criteria for enterprises to qu alify for assistance under this program? 
 
Reply 
 
Joint Task Scheme funding may only be allocated in the assisted areas designated in the 
Coordination Framework.5 
 
There shall be no legal entitlement to Joint Task Scheme funding. 
 Joint Task Scheme funding shall be provided as supplementary aid. It is therefore not intended to replace other public financing facilities with no regional objectives. An appropriate share of finance 
shall be borne by the project implementing agency. 
 The assessment of a project’s eligibility for aid is  contingent on the time when the decision on 
awarding Joint Task Scheme funding is made . Any modifications of the rules governing 
requirements and the type and intensity of ai d through the adoption of a new Coordination 
Framework or during the term of a current Coordination Framework shall be binding for all 
applications submitted after publication of the modifications in the Federal Gazette, unless the new 
rules make provision for a di fferent term of validity. 
 Joint Task Scheme funding shall be provided as grants upon application. Applications shall be 
submitted to an authorized office befo re project start using official forms. 
 Before Joint Task Scheme funding is granted,  an assessment shall be made of whether: 
 
• the investment project conforms with the obje ctives, principles and other requirements of 
regional planning; 
• the project has been approved by the competent authorities; 
• measures will be taken to prevent or minimise harmful emissions (particularly air, water 
and soil pollution, noise) and ensure the prop er treatment of waste on commissioning of 
the project in direct receipt of aid or of pe rmanent establishments built on industrial or 
commercial premises developed with the aid of Joint Task Scheme funds; 
• the investment project: 
o conforms with the development strategy of th e municipality and/or several neighbouring 
municipalities as laid 
o down in the area development plan under the Federal Building Code; if there are no area 
development plans, the 
o project shall comply with the relevant provisions of planning and building law 
(Sections 29 ff of the Federal Building Code); 
                                               
5 See http://bmwi.de/BMWi/Redaktion/PDF/foerdergebietskarte-ab-
07,2014,property=pdf,bereich=bmwi2012,sprache=de,rwb=true.pdf for the new regional aid map. G/SCM/Q2/EU/38 
 
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  o is relevant to urban redevelopment and development measures under the Federal Building 
Code and, if so, 
o supports the envisaged urban planning goals (Sections 139, 149 165 (4), 171, 164 (a 
and b) of the Federal Building Code); 
o conforms with the results of preliminary agrostructural planning drawn up in compliance 
with the aid principles of the Joint Task Scheme for the Improvement of Agricultural Structures and Coastal Protection. 
 
The aid grant decision shall be annulled and the beneficiary ordered to refund aid already granted 
where aid requirements under the Coordination Fr amework on which the decision was based have 
not been met after completion of the investment project or the measure. 
 
8. National Programme for Civil Aeronautical Research  
 
• What is the duration of this program? 
 Reply 
 The program is currently not time-limited. Its duration depends on the available budget.  Italy 
 Questions regarding notified programs: 
 
• For many of the notified programs Italy provided information for the years 2009 
and 2010. Could Italy please provide this  information for the reporting period, 
2011 – 2012, or explain when this information will be provided? 
 
Reply 
 An updated notification is being prepared and will be provided for those schemes where the 
information reported did not cover the years 2011 and 2012. This will be submitted shortly.  
 Questions regarding programs not included in the notification: 
 Special Funds for Applied Research (FRA) & other government support for research and development 
 
• Italy notified the FRA program in a prior notification
6. Publically available 
information indicates that the FRA and other government funded research and 
development programs7 are in operation in Italy, including the National 
Aerospace Research Program (Programma nazionale di Ricerche Aerospaziali – 
PRORA).8 Please provide full information regarding the FRA and other research 
programs, such as the PRORA that were in  operation during the reporting period 
or otherwise explain why these programs  are not subject to the notification 
requirements of the SCM Agreement. 
 
Reply 
 
The law sets out the allocation of the aid into the two main forms of funding, - grant and soft 
loan -, according to fixed amounts (Law no. 49/82 – Ministerial Decree no. 954/97; Law 
no. 488/92 - Ministerial Decree no. 629/97; Law no. 297/99 - Ministerial Decrees no. 593/2000 
and no. 90402/2003) and in respect of EU regulations on R&D state aids.   
Under these regulations, the acknowledgement of  further particular amounts may change the 
originally fixed ones. According to law no. 297/99 and Ministerial Decrees no. 593/2000 and no. 90402/2003, the duration of the funding is maximu m ten years, starting from the issue date of 
the ministerial decree acknowledging the selected proposals. 
                                               
6 G/SCM/N/186/EEC/Add.14. 
7 https://www.researchitaly.it/en/ researching/funding/programmes/ 
8 http://hubmiur.pubblica.istruzione.it/web/ricerca/ enti-di-ricerca/elenco-enti/prora/executive-summary G/SCM/Q2/EU/38 
 
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  This duration includes pre-amortization and utili zation periods, up to maximum five years.  
 The amortization instalments are fixed, postponed and inclusive of capital and interests; they are 
on a six-monthly basis: the annual deadlines are 1st January and 1st July.  
 
As the FRA was conveyed into FIRST (Fondo Investimenti Ricerca Scientifica e Tecnologica – Scientific and Technological Reserch Investment Fund), a ministerial decree n. 115/2013 provided 
the regulation for FIRST, focusing on the Call as the one and only path for the applicants to follow 
in obtaining grants.   The Netherlands  
 
Questions regarding programs not included in the notification: 
 
• The Netherlands previously notified a numbe r of additional programs that were not 
included in its' current notification.9 With the exception of one program 
(i.e. Program VII) in that prior notification, the duration reported for those 
programs included or went beyond 2011.  Could the Netherlands please explain 
why the programs were not notified in its current submission? 
 Reply 
 The programs concerned were terminated earlier than planned. Therefore, they were not mentioned in the current notification.  
 
Government Funding for Research and Development  
• Publically available information indicates that the Netherlands provides funding for 
a variety of research and de velopment activities that appear to be subject to the 
notification requirements of the SCM Agreement.
10 These include, inter alia , the 
SURFnet, ICT research and NanoNext NL programs. Please provide full 
information regarding these and any other government funded research and 
development programs or otherwise expl ain why these programs are not subject 
to the notification requirements of the SCM Agreement? 
 
Reply 
 
The SURFnet program receives funding from th e Dutch government. Members of SURFnet are 
public universities, colleges of higher education and public research institutes. Private enterprises and industries cannot become a member. Therefore, SURFnet is not subject to the notification requirements of the SCM Agreement. 
 
The Netherlands believes that the other mentioned programs (i.e. ICT research/COMMIT and NanoNextNL) are not subject to the notification requirements of the SCM Agreement as laid down 
in article 25.2 of the SCM Agreement. The government funding of the mentioned research and 
development programs are based on objective criteria governing the eligibility for, and the amount of subsidy. The criteria and conditions for the eligibility for subsidy are laid down in law, 
regulations and other official documents which are publicly available, and access to the subsidy is 
not limited to certain enterprises. Therefore, spec ificity does not exist (ref. article 2.1.(b) of the 
SCM Agreement).   
Though, much information about government funding concerning the mentioned programs is 
already publicly available (see: http://www.nanonextnl.nl/  and http://www.commit-nl.nl/ ). 
 
 
__________  
                                               
9 G/SCM/N/220/EEC/Add.19. 
10 http://www.government.nl/issues/science/national-research.