G/SCM/Q2/CHN/55  
 
27 January 2016  
(16-0529)  Page: 1/3  
Committee on Subsidies and Countervailing Measures  Original: English  
 
SUBSIDIES 
QUESTIONS POSED BY JAPAN REGARDING THE NEW 
AND FULL NOTIFICATION OF CHINA1 
The following communication, dated 25 January 2016, is being circulated at the request of the 
Delegation of Japan.  
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  General  
 
Question 1  
While we appreciate the third notification  of China (G/SCM/N/220/CHN-G/SCM/N/253/CHN-
G/SCM/N/284/CHN), this notification only covers subsidy programmes at the central government 
level. 
At the Committee meeting in October 2011, the delegate of China explained to the Committee that 
China would work towards incorporating local programmes into the notification (G/SCM/M/79). At 
the Committee meeting in October 2015, the delega te of China also explained to the Committee 
that local programmes would be notified as soon as possible. 
When does China submit notification which includes the programmes granted or maintained at 
both the central and the local government level? 
Question 2 Article 25.3 of the SCM Agreement requires a notification of subsidies to be "sufficiently specific to 
enable other Members to evaluate the trade effe cts and to understand the operation of notified 
subsidy programmes". In particular, the notification must contain "subsidy per unit or, in cases where this is not possible, the total amount or  the annual amount budgeted for that subsidy 
(indicating, if possible, the average subsidy per unit in the previous year)".  
However, in China's notification, "subsidy per unit, or in cases where this is not possible, the total 
amount or the annual amount budgeted for that subs idy" of all the preferential taxes (No. 1-11, 
13-24, 26-34, 42, 56-61, 63-64, 86) are notified as "not available". 
As stipulated in Article 25.3, Japan would like to request China to at least specify subsidies with 
especially large amount (e.g. subsidies with a budgeted amount exceeding a billion RMB/per year) in China's notification. If there is any reason why China cannot do so, please explain. 
                                               
1 G/SCM/N/220/CHN-G/SCM/N/253/CHN-G/SCM/N/284/CHN. G/SCM/Q2/CHN/55 
 
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  Preferential tax treatment for energy-sav ing and new energy vehicles and vessels 
(No. 22) 
Question 3 Please explain the details of eligibility criteria  for "energy-saving and new energy vehicles and 
vessels". Are there any different criteria betwee n domestically manufactured vehicles/vessels and 
imported vehicles/vessels? Has there been any inst ance in which China granted the benefit of the 
subsidy to imported vehicles/vessels? Please explain. 
 
Preferential tax policies for enterpri ses making little profits (No. 27)  
Question 4 Please explain how many companies have received this subsidy in China. What is the rationale for 
subsidizing enterprises with little profits inst ead of subjecting such companies to market 
mechanisms? 
Preferential tax policies for the research and development of enterprises (No. 33)  
Question 5 
What are "new technologies, new products and new techniques" that are eligible for this subsidy? 
To what enterprises and/or industrial fields has the subsidy been granted so far? 
Research and development fund for in dustrial technologies (No. 35)  
Question 6 What kinds of "important technological research and development projects" are eligible for this 
subsidy? Please specify examples of "researc h and development projects" that have been 
approved under the programme. 
Fund for promotion of coordinated developmen t of foreign trade and economic relations 
among regions (No. 38) 
Question 7 
China explains "This fund is provided for projects aiming at exploration of international market , 
scientific innovation and information system construction in the central, western and north-eastern 
regions of China" What are specific means by which the beneficiaries of this subsidy are considered 
to "explor[e] the international market"? Please explain. 
Subsidy fund for the promotion of energy-saving products (No. 74)  
Question 8 
What is the definition of "the efficient energy -saving products"? Could consumers receive grants 
even if they purchase imported products? If yes, please provide the requirements to qualify as the 
"efficient energy-saving products" under this promotion programme. G/SCM/Q2/CHN/55 
 
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  Special fund for the development of st rategic emerging industry (No. 81)  
Question 9 What kinds of "emerging industries" are eligible for this subsidy? Please list all "emerging 
industries" that have received funds under the programme. 
Agriculture 
Subsidy for purchasing agricultur al machinery and tools (No. 47) 
Question 10 
This program does not seem to have been included  in the China's latest notification submitted to 
the Committee on Agriculture (G/AG/N/CHN/28). Please explain why. 
Comprehensive Subsidies for agricultural inputs (No. 48) 
Question 11 
Please describe what are included in "agricultural inputs". 
In the China's latest notification to the Committee on Agriculture (G/AG/N/CHN/28), "subsidies for 
improved crop strains and seeds" for wheat, rice and other crops are reported as "Product-Specific 
AMS", and "input subsidies" are reported as "Non-Product-Specific AMS".  
Are "agricultural inputs" in No. 48 the same as the above-mentioned supports notified to the 
Committee on Agriculture? 
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