G/SCM/Q2/EU/37  
21 October 2014  
(14-6044)  Page: 1/3  
Committee on Subsidies and Countervailing Measures  Original: English/French  
 
  SUBSIDIES 
REPLIES TO QUESTIONS FROM CANADA1 REGARDING THE NEW 
AND FULL NOTIFICATION OF THE EUROPEAN UNION2 
The following communication, dated 6 October 2014, is being circulated at the request of the 
delegation of the European Union.  
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FRANCE 
Question 
Aid scheme for innovation in and the su stainable development of air transport 
The description of the aid scheme for innova tion in and the sustainable development of 
air transport that was published on the websit e for the Ministry of Ecology, Sustainable 
Development and Energy states that for all aid exceeding 7.5 million euros, or for an 
RDI project submitted by a large company, th e incentive effect will be assessed based 
on at least one of the following indicators: incr ease in the size of th e project, increase in 
scope, increase in pace, increa se in the total amount allocated to RDI, in relation to the 
information in a counterfactual scenario. 
 Could France please specify whether the ai d is granted in the form of a grant or 
loan? 
Reply 
Support for research institutes and companies under the aid scheme for innovation in and 
sustainable development of air transport, notified by France for 2011 and 2012, is provided in the 
form of non-repayable subsidies. 
 At what levels on the Technology Readiness Level (TRL) scale must the 
RDI projects be? 
Reply 
The support covers RDI projects at TRL levels 1 to 6. 
 Could France please provide a list of the projects that were financed between 
2011 and 2013, indicating what type of aid was granted to each as well as the 
names of the recipient research institutes and/or companies? 
                                               
1 G/SCM/Q2/EU/30. 
2 G/SCM/N/253/EU/Add.9; G/SCM/N/253/EU/Add.10; G/SCM/N/253/EU/Add.27. G/SCM/Q2/EU/37 
- 2 - 
  Reply 
Support for institutions engaged in research fo r the sustainable development of air transport, 
notified by France for 2011 and 2012, mainly went  to France's national aerospace research centre, 
the Office National des Études et des Recherches Aérospatiales (ONERA), in the form of 
non-repayable subsidies. 
Support for innovation in and sustainable developmen t of air transport, notified by France for 2011 
and 2012, was granted to around 100 companies, ranging from small or medium-size enterprises 
(SMEs) to subsidiaries of large business groups, in addition to several research institutions. It was 
provided in the form of non-repayable subsides. 
GERMANY 
Question 
National Programme for Civ il Aeronautical Research 
Based on the description of this programme,  it appears that non-repayable grants are 
intended to contribute to strengthen medi um and long-term research and technology. 
Could the European Union provide the number of recipients under this programme and 
confirm the number of projects that were supported by this programme in 2011 and 2012? 
Reply 
In 2011 and 2012, 178 recipients with 598 proj ects were supported by this programme. 
What levels of development on the Technology Readiness Level (TRL) scale are the 
projects receiving funding through this subsidy? 
Reply 
In general projects with levels of development 1 to 6 on the TRL scale can be supported by this 
programme. 
UNITED KINGDOM 
Question Buying-Time Assistance (Northern Ireland)  and Northern Ireland Restructuring Aid 
It is noted that support under the programmes, "Buying-Time Assistance 
(Northern Ireland)" and "Northern Irelan d Restructuring Aid", is provided to 
manufacturing and internationally traded se rvice companies in Northern Ireland who 
are experiencing trading difficulties. 
 Can the United Kingdom please desc ribe what is meant by "trading 
difficulties"? 
Reply 
To be eligible for Buying-Time Assistance or Restructuring Aid, a company in 'trading difficulties' 
must be 'in difficulty' as defined by the Commission in section 2.1 of the Rescue and Restructuring Guidelines - http://eur-lex.europa.eu/legal-content /EN/TXT/?uri=CELEX:52004XC1001(01) . 
 G/SCM/Q2/EU/37 
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  See relevant extract hereunder: 
2.1. Meaning of 'a firm in difficulty' 9. There is no Community definition of what constitutes 'a firm in difficulty'. However, for the 
purposes of these Guidelines, the Commission regards a firm as being in difficulty where it is 
unable, whether through its own resources or with the funds it is able to obtain from its 
owner/shareholders or creditors, to stem losse s which, without outside intervention by the 
public authorities, will almost certainly condemn it to going out of business in the short or 
medium term. 
10. In particular, a firm is, in principle and irrespective of its size, regarded as being in difficulty 
for the purposes of these Guidelines in the following circumstances: 
(a) in the case of a limited liability company (4), where more than half of its registered 
capital has disappeared (5) and more than one quarter of that capital has been lost 
over the preceding 12 months; 
(b) in the case of a company where at least some members have unlimited liability for the 
debt of the company (6), where more than half of its capital as shown in the company 
accounts has disappeared and more than one quarter of that capital has been lost 
over the preceding 12 months; 
(c) whatever the type of company concerned, where it fulfils the criteria under its 
domestic law for being the subject of collective insolvency proceedings. 
11. Even when none of the circumstances set out in point 10 are present, a firm may still be 
considered to be in difficulties, in particular where the usual signs of a firm being in difficulty 
are present, such as increasing losses, diminishing turnover, growing stock inventories, 
excess capacity, declining cash flow, mounting debt, rising interest charges and falling or nil net asset value. In acute cases the firm may already have become insolvent or may be 
the subject of collective insolvency proceedin gs brought under domestic law. In the latter 
case, these Guidelines apply to any aid grante d in the context of such proceedings which 
leads to the firm's continuing in business. In any event, a firm in difficulty is eligible only 
where, demonstrably, it cannot recover through its own resources or with the funds 
it obtains from its owners/shareholders or from market sources. 
12. For the purposes of these Guidelines, a newly created firm is not eligible for rescue or 
restructuring aid even if its initial financial position is insecure. This is the case, for instance, 
where a new firm emerges from the liquidation of  a previous firm or merely takes over such 
firm's assets. A firm will in principle be considered as newly created for the first three years following the start of operations in the relevant field of activity. Only after that period will it 
become eligible for rescue or restructuring aid, provided that: 
(a) it qualifies as a firm in difficulty within the meaning of these Guidelines, and (b) it does not form part of a larger business group  (7) except under the conditions laid 
down in point 13. 
13. A firm belonging to or being taken over by a larger business group is not normally eligible 
for rescue or restructuring aid, except where it can be demonstrated that the firm's difficulties are intrinsic and are not the result of an arbitrary allocation of costs within the 
group, and that the difficulties are too serious to be dealt with by the group itself. Where 
a firm in difficulty creates a subsidiary, the subsidiary, together with the firm in difficulty controlling it, will be regarded as a group and may receive aid under the conditions laid 
down in this point. 
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