WORLD TRADE  
ORGANIZATION  G/SCM/N/155/EEC/Add.25
26 November 2007 
 (07-5195) 
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 COMMUNITIES 
 
Addendum
 
   The following addendum to the notification of the European Communities relates to subsidy 
programmes of Sweden .   
 
_______________ 
 G/SCM/N/155/EEC/Add.25 
Page 2  
 
  SWEDEN  
 
TABLE OF CONTENTS 
 
 
Page  
 
1. INTRODUCTION - METHOD AND SC OPE OF THE NOTIFICATION ........................4  
2. SUPPORT FOR RESEARCH  AND DEVELOPMENT .......................................................5  
2.1 SUPPORT FOR TECHNOLOGICAL R&D ........................................................................................5  
2.2 PROJECT FINANCING THROUGH THE FUND FOR INDUSTRY ........................................................6  
2.3 ENERGY RESEARCH PROGRAMME ..............................................................................................7  
2.4 THE ENERGY TECHNOLOGY FUND .............................................................................................8  
2.5 GRANT FOR NEW ENERGY TECHNOLOGY ...................................................................................9  
2.6 TRANSPORT - AND COMMUNICATION RESEARCH ........................................................................9  
2.7 PROJECT FINANCING THROUGH THE FUND FOR SWEDISH -NORWEGIAN INDUSTRIAL 
CO-OPERATION ..........................................................................................................................10  
2.8 SUPPORT TO ENERGY MAINTENANCE IN THE SOUTH OF SWEDEN ...........................................11  
3. AID TO SMALL AND MEDI UM SIZED COMPANIES...................................................12  
3.1 THE REGIONAL DEVELOPMENT COMPANIES , ALMI ................................................................12  
3.2 SUPPORT TO SMALL COMPANIES ..............................................................................................13  
3.3 INDUSTRIAL DEVELOPMENT CENTERS .....................................................................................14  
4. SUPPORT FOR EMPLOYMENT AND TRAINING.........................................................15  
4.1 SUPPORT FOR VOCATIONAL TRAINING .....................................................................................15  
5. EXPORT PROMOTION .......................................................................................................16  
5.1 GENERAL EXPORT PROMOTION ................................................................................................16  
6. REGIONAL AID TO ENTERPRISES.................................................................................17  
6.1 REGIONAL DEVELOPMENT GRANT ...........................................................................................17  
6.2 LOANS TO REGIONAL INVESTMENT COMPANIES ......................................................................18  
6.3 EMPLOYMENT GRANT ...............................................................................................................18  
6.4 REGIONAL TRANSPORT GRANT ................................................................................................20  
6.5 THE FUND FOR NORTHERN SWEDEN ........................................................................................21  
7. ENVIRONMENT AID ...........................................................................................................22  
7.1 GRANTS FOR LOCAL INVESTMENT PROGRAMMES FOR ECOLOGICALLY SUSTAINABLE 
DEVELOPMENT (LIP) ................................................................................................................22  
7.2 INVESTMENT GRANT FOR CERTAIN INVESTMENTS WITHIN THE ENERGY SECTOR ..................23  
7.3 SUPPORT TO SMALL SCALE ELECTRICITY PRODUCTION ...........................................................23  
7.4 SUPPORT TO WIND POWER PRODUCTION .................................................................................24   G/SCM/N/155/EEC/Add.25 
 Page 3 
 
 
  7.5 MANUFACTURING INDUSTRY TAX RELIEF – CO2  AND ENERGY TAXES ON FOSSIL 
FUELS ............................................................................................................................... .........25  
7.6 RELIEFS FROM ENERGY AND CO2  TAXES FOR FUELS USED FOR HEAT PRODUCTION IN 
CHP S............................................................................................................................... ..........26  
7.7 CO2  TAX RELIEF FOR THE MANUFACTURING SECTOR (0,8  RULE )...........................................27  
7.8 ENERGY TAX RELIEF ON ELECTRICITY FOR THE MANUFACTURING SECTOR ..........................27  
7.9 WASTE TAX CONCESSION .........................................................................................................28  
7.10 GRANTS FOR CLIMATE INVESTMENT PROGRAMMES (KLIMP )..................................................29  
APPENDIX:  THE NET COST METHOD.......................................................................................30  
 G/SCM/N/155/EEC/Add.25 
Page 4  
 
  1. INTRODUCTION - METHOD A ND SCOPE OF THE NOTIFICATION 
 In Sweden, the budget of the central government is the only source of aid to industry.  Local 
governments are in principle prohibited by law to gran t aid to enterprises.  However, administration of 
aid programmes funded by the central government may take place at the local level.   
 
 The notification covers aid to the business sector, in broad sense, i.e. trade and industry.  It is 
not possible to separate aid figures to the mining and manufacturing industry (SITC 2 and 3).     The description of the various aid schemes follo ws the outline suggested by WTO.  However, 
it is not possible to present statistical data permitting an assessment of trade effects.   
 
 The quantitative information is based on the net cost to government method.  This method is 
used for the annual follow-up of stat e aid in Sweden.  The approach h as also been used by OECD in 
its "Public Support to Industry" project.  The method is described in appendix.   
 
  G/SCM/N/155/EEC/Add.25 
 Page 5 
 
 
  2. SUPPORT FOR RESEARCH AND DEVELOPMENT 
 The former Swedish National Board for Indus trial and Technical Development, NUTEK, was 
on the 1st of January 2001 divided into three ne w authorities;  The Swedish Business Development 
Agency (NUTEK), The Swedish Agency for Innova tion Systems, Vinnova, and the Swedish Institute 
for Growth Policy Studies, ITPS.  As from the da te mentioned, support from the aid programme 2.1 
below, is in part jointly administrated by VINNOVA and NUTEK.   
 2.1 S
UPPORT FOR TECHNOLOGICAL R&D   
 
(a) Form of subsidy  
 
 Grants or loans with conditional repayment.    
(b) Amount of subsidy 
  Net cost in SEK millions:  Calendar year  2005:  581
 
    2006:  662  
  Support is granted to a variety of projec ts and cannot be broken down per unit.   
 
(c) Policy objective  
 
 The primary objective is aid for R&D and the secondary objective is aid to SMEs.    
(d) Duration 
  The programme commenced as from 1st of July 1993.  Duration until further notice, i.e. has 
not been specified.    
(e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to 
present  statistical  data permitting an assessment of trade effects.   
 
(f) Legal basis  
 
 The legal provisions are laid down in the Governmental ordinance 1995:1254 (Förordning om 
statligt stöd till teknisk forskning, industriellt utvecklingsarbete och uppf innarverksamhet).   
 
(g) Rules and conditions  
 
 The programme is administrated by the Swedish Agency for Innovation Systems, VINNOVA and partly, i.e. seedfinancing, by the Swed ish Business Development Agency, NUTEK.   
 
 The Swedish Agency for Innovation Systems , VINNOVA´s mission is to promote sustainable 
growth by financing RTD and developing eff ective innovation systems.  NUTEK, the Swedish 
Business Development Agency, is Sweden's central public authority for industrial policy issues.  
Together with ALMI Business Partner NUTEK forms a competence centre for financing, 
entrepreneurship, industrial developmen t and regional business development.   
  Support is granted to universities, technologi cal research institutes fo r basic research, co-
operative research institutes (i.e. institutes finan ced jointly by government and industry) and to G/SCM/N/155/EEC/Add.25 
Page 6  
 
  individual firms and inventors.  A precondition for recei ving support in the form of grants is that the 
result of the supported project is made public.     All firms, regardless of industry, are eligible.  However, the support is focused on small firms and individual innovators.  The support to firms and individual inventors is in the form of loans with 
conditional repayment.  A loan can cover up to 50 per cent of project costs.  Repayment, including 
market interest rate, is required if a project b ecomes commercially successful.  The duration and other 
terms of the loan are dependent on the objective of the loan and various economic factors.  Costs for 
personnel, material and supplies related to R&D,  instruments and equipment, consulting bought-in 
research, etc. are eligible for aid.  Other possible aid should be taken into account before the decision 
of support is made.  In practice,  projects supported by other state aid schemes do not normally receive 
support from VINNOVA or NUTEK.  To the extent th at this occurs, the aid ceilings apply to the 
combined aid.     As from 1st of January 1996 rules and conditions  have been altered in accordance with the 
state aid rules within the European Community.  In  practice the new rules have been applied as from 
1
st of January 1995.   
 2.2 P
ROJECT FINANCING THROUGH THE FUND FOR INDUSTRY  
  The Fund for Industry is a public foundation.  Its main objective is to promote industrial 
development and marketing.  The Fund should earn e nough money to retain its  capital on a long term 
basis.  This calls for market interest rate s to compensate for a few inevitable losses.   
 
(a) Form of subsidy  
  Project financing in the form of loans with conditional repayment, guarantees and grants with 
royalty repayments.  No calculated element of s ubsidy to individual enterprises, but high risk is 
accepted.    
(b) Amount of subsidy  
  Net cost in SEK millions:  Calendar year  2005:  30
1   
       2006:  322 
  Support is granted to a variety of projec ts and cannot be broken down per unit.   
 (c) Policy objective  
 
 The primary objective of the project financing is aid to SMEs and R&D.    
(d) Duration 
  The scheme commenced in 1979 and was altere d in 1993 and 1996.  Duration has not been 
specified.    
(e) Statistical data  
  The support is granted to a variety of projects and sectors, therefore it is not possible to 
present statistical data permitting an assessment of trade effects.    
                                                     
 
1 The net cost figure for the year 2005 is not available, hence the reported figure is an estimate.   
2 The net cost figure for the year 2006 is not available, hence the reported figure is an estimate.    G/SCM/N/155/EEC/Add.25 
 Page 7 
 
 
  (f) Legal basis  
 
 The legal provisions are laid down in the G overnmental ordinance SFS 1996:880 (Förordning 
om finansiering genom Industrifonden).    (g) Rules and conditions 
 
 Project financing:  The Fund concentrates on s upport to small and medium-sized companies.  
There are no restrictions regarding industry or location.  To be eligible for support, a project must involve a substantial risk, but have a compensati ng potential to become commercially successful.  The 
maximum amount of an award cannot exceed 50 per cent of the costs of a project.  Expenditures 
connected with a development project (seldom land or buildings) are eligible for financing.  All 
successful SMEs pay back with market interest ra te or royalty.  Financing from the Fund may be 
combined with regional support, in accordance with th e state aid rules in the European Community.   
 
2.3 E
NERGY RESEARCH PROGRAMME  
 
(a) Form of subsidy  
 
 Grants or loans with conditional repayment.    (b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005:  84
 
    2006:  79  
 Support is granted to a variety of projec ts and cannot be broken down per unit.   
 
(c) Policy objective  
 
 The primary objective of the programme is to establish fundamental competence and expertise, to facilitate the transformation of th e Swedish energy system in order to reduce the 
environmental and climatic effects of energy syst ems.  The emphasis of th e programme is long-term, 
i.e. on technology that can be expected to be implemented beyond the year 2000.  The programme has 
its main focus on basic research, while applied research only plays a minor role.    
(d) Duration  
  Programme commenced originally in 1975 and has been prolonged several times.  The 
programme has been altered as from June 1998 in order to reflect the objectives of the political 
agreement on Swedish Energy Policy reached in 1997.  Duration until further notice, i.e. has not been 
specified.    
(e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis  
 
 As from June 1998, legal provisions are laid down in Governmental ordinance SFS 1998:222 
(Förordning om statligt stöd till energiforskning).   G/SCM/N/155/EEC/Add.25 
Page 8  
 
  (g) Rules and conditions 
 
 The main part of the programme is administrated by the Swedish Energy Agency, STEM, but the Swedish Agency for Innovation Systems,  VINNOVA, the Swedish Research Council for 
Environment, Agricultural Sciences and Spatia l Planning, FORMAS and the Swedish Research 
Council , Vetenskapsrådet are responsible for some elemen ts of the programme.  Support is granted to 
universities, institutes of technology, co-operative res earch institutes (i.e. institu tes financed jointly by 
the government and industry) and to firms.  The general rule is that all results from the Energy 
Research Programme are official and shall be made  publicly available.  Aid to firms accounts for a 
minor portion of the expenditure.  Costs for pers onnel, materials and supp lies related to R&D, 
instruments and equipment, consulting, bought in r esearch etc. are eligible for aid.  Maximal aid 
intensity is 50 per cent of eligible costs.  Other po ssible aid shall always be taken into account before 
decision of support is made.    2.4 T
HE ENERGY TECHNOLOGY FUND 
 
(a) Form of subsidy 
 
 Grants, soft loans and guarantees.    
(b) Amount of subsidy 
 
 Net cost in SEK millions:  Calendar year  2005:  18
 
    2006:  19  
  Support is granted to a variety of projec ts and cannot be broken down per unit.   
 
(c) Policy objective 
 
 The primary objective is aid for R&D with a focus on new technology for energy production and for environmental protection.    (d) Duration 
 
 The programme commenced as from 1st of July 1988.  The programme has been altered as 
from June 1998 in order to reflect the objectives of  the political agreement on Swedish Energy Policy 
reached in 1997.  Duration until further no tice, i.e. has not been specified.   
 
(e) Statistical data 
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    (f) Legal basis 
 
 The legal provisions are laid down in Go vernmental ordinance SFS 1998:653 (Förordning om 
statligt stöd till energiteknik).    (g) Rules and conditions 
 
 The programme is administrated by the Swed ish Energy Agency, STEM. Support is granted 
to the development, testing and de monstration of new techniques in the form of test plants, pilot 
projects, full scale plants, etc.  Support is also granted to applied research jointly co-financed by 
industry.  The beneficiary is normally the user of the new technique, mainly small-scale private  G/SCM/N/155/EEC/Add.25 
 Page 9 
 
 
  energy producers and public utilities in the energy sector.  The maximum possible aid is 50 per cent of 
the project costs where SMEs can re ceive an additional 10 per cent.   
 2.5 G
RANT FOR NEW ENERGY TECHNOLOGY  
 (a) Form of subsidy 
 
 Grants.  
(b) Amount of subsidy 
 
 Net cost in SEK millions:  Calendar year  2005:  101
 
    2006:  25  
  Support is granted to a variety of projec ts and cannot be broken down per unit.   
 (c) Policy objective 
 
 The primary objective is aid to R&D with a focus on developing technology for the use of sustainable sources of energy.    (d) Duration 
 
 Duration until further notice, i.e. has not been specified.   
 
(e) Statistical data 
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis 
  The legal provisions are laid down in the Governmental ordinance SFS 1998:654 (Förordning 
om energiteknikbidrag).  
(g) Rules and conditions 
  The programme is administrated by the Swedis h Energy Agency, STEM.  Support is granted 
to industrial research in order to develop new t echnology based on sustainable sources of energy and 
for efficient use of energy in industrial processes.  The maximum possible aid to projects concerning industrial research is 50 per cent of the project costs.  The maximum support to projects aiming at a 
market introduction of products or services is 25 per cent of the project costs where SMEs can receive 
an additional 10 per cent.  In acco rdance with the state aid rules within the European Community, 
there are restrictions to which extent the gran t may be combined with other aid schemes.   
 2.6 T
RANSPORT - AND COMMUNICATION RESEARCH  
  This programme is as from 2001 administra ted by the Swedish Agency for Innovation 
Systems, VINNOVA, as a part of the programme reported above under 2.1, i.e. Support for technical 
R&D through VINNOVA & NUTEK.  The legal provisions are laid down in the Governmental ordinance 1995:1254 (Förordning om statligt stöd till teknisk forskning, industriellt utvecklingsarbete 
och uppfinnarverksamhet).    G/SCM/N/155/EEC/Add.25 
Page 10  
 
  2.7 P
ROJECT FINANCING THROUGH THE FUND FOR SWEDISH -NORWEGIAN INDUSTRIAL CO-
OPERATION  
  The Fund for Swedish-Norwegian Industrial Co-operation is a foundation operating relatively 
independently from the Swedish and Norwegian G overnments.  The Fund should earn enough money 
to cover the inflation on a long term basis.  This ca lls for market interest ra tes to compensate for a few 
inevitable losses.  The Fund for Swedish-Norwegian I ndustrial Co-operation was dissolved in the year 
2003.    
(a) Form of subsidy 
 
 Loans with conditional repayment and venture capital.    
(b) Amount of subsidy 
  Net cost in SEK millions: Calendar year   2005:  20
 
    2006:  0  
 
 Support is granted to a variety of projec ts and cannot be broken down per unit.   
 
(c) Policy objective 
 
 The primary objective is aid to SMEs and for R&D.  The objective of the Fund is to support 
development co-operation between Swed ish and Norwegian companies.   
 
(d) Duration 
 
 The programme commenced as from 1st of Janua ry 1982. Duration until the year 2001, with a 
automatic prolongation if the agreement/contract is not  withdrawn.  Terms of notice is 3 years.  The 
Fund for Swedish-Norwegian Industrial Co-ope ration was dissolved in the year 2003.   
 
(e) Statistical data 
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis 
 
 The legal provisions are laid down in the Governmental ordinance SFS 1990:45 (Förordningen 
om stöd genom Fonden för svenskt-norskt industrie llt samarbete), amended th rough SFS 1998:49.   
 
(g) Rules and conditions 
  Costs connected with a development project ( seldom land or buildings) are eligible.  Maximal 
aid intensity is 50 per cent of eligible costs.  A pr econdition is that the project is a high risk project 
and has prospects to be commercially successful on a re latively short term basis.  All successful SMEs 
pay back with market interest rates or royalty.  Beneficiaries are Swedish and Norwegian companies 
in all industry except the extraction of oil and gas.  There are no formal restrictions to which extent 
financing through the Fund may be combined with other aid schemes other than the state aid rules of 
the European Community.    G/SCM/N/155/EEC/Add.25 
 Page 11 
 
 
  2.8 S UPPORT TO ENERGY MAINTENANCE IN THE SOUTH OF SWEDEN  
(a) Form of subsidy 
 
 Grants.    (b) Amount of subsidy 
 
 Net cost in SEK millions:  Calendar year  2005:  0
 
    2006:  0  
 (c) Policy objective 
 
 The primary objective is aid to R&D with a focus on developing technology for the use of sustainable sources of energy.   
 
(d) Duration  
 The programme has been terminated .  The programme commenced as from 15
th of May 1999.  
Duration until 31st of December 2002 . Programme terminated and the last payments during the year 
2003.    (e) Statistical data 
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    (f) Legal basis 
 
 The legal provisions are laid down in the Governmental ordinances: SFS 1998:62 (Förordning 
med instruktion för Delegationen för energiförs örjning i Sydsverige) and SFS 1999:213 (Förordning 
om statligt stöd till energiförsörjningen i Sydsverige).    (g) Rules and conditions 
 
 The programme is administrated by the Delega tion for energy maintenance in the south of 
Sweden, DESS.  The aim is to ma intain the energy supply in the south of Sweden since the two 
nuclear power units in Barsebäck are going to be closed.
3  The total amount of support during the two 
years period is 400 SEK million where about 55 per cent goes to SMEs, 35 per cent to technological 
research institutes and co-operative research institutes, and 10 per cent to universities.  The support 
covers the entire cost of R&D-projects and maximum 50 per cent when the projects are industrial.  Projects aiming at an introduction of products on the market are covered with maximum 25 per cent 
of the costs.  10 per cent is added on these support-levels  if the receiver is a SMEs. Costs covered are:  
staff costs, operative expenses, costs of ma terials, and costs for consultants.   
                                                     
 
3 The regions in the south of Sweden are limited to Skåne, Blekinge, south of Småland and south of 
Halland.   G/SCM/N/155/EEC/Add.25 
Page 12  
 
  3. AID TO SMALL AND MEDIUM SIZED COMPANIES 
3.1 T
HE REGIONAL DEVELOPMENT COMPANIES , ALMI 
  ALMI, Regional Development Companies, cons ist of a parent company and 22 regional 
subsidiaries.  The objective of ALMI is to stre ngthen the competitiveness and profitability of small 
and medium sized enterprises and to promote the formation of new firms.   
 
(a) Form of subsidy 
 
 Loan guarantees, guarantees for bank guarantees,  loans, new business loans and development 
capital in the form of grants with ro yalties repayment and soft loans.   
 
(b) Amount of subsidy 
 
 Net cost in SEK millions:  Calendar year  2005:  146
 
    2006:  81  
  Support is granted to a variety of projects  and can not be broken down per unit.   
 
(c) Policy objective 
  The primary objective of the scheme is aid to  SMEs.  The Regional Development Companies 
should strengthen the competitiveness and profitab ility of small and medium sized enterprises 
(defined as firms with less than 250 employees,  in accordance with th e European Commission 
definition) and to promote the formation of new firms.    (d) Duration 
 
 The programme for loans and guarantees comme nced in 1978, development capital in 1982 
and new business loans in 1993.  Duration until furt her notice, i.e. has not been specified.   
 
(e) Statistical data 
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis 
 
 The legal provisions are laid down in the follo wing Governmental ordinance:  SFS 1994:1100 
(Förordning om statlig finansiering genom regi onala utvecklingsbolag), amended through SFS 
1995:1196.    
(g) Rules and conditions 
 
 General rules for all forms of financing:  Th e scheme is strictly complementary to private 
institutions.  The scheme is intended for small firms,  i.e. firms with less than 250 employees.  (In 
practice, often under 50 employees.) The Regiona l Development Companies have discretion in 
respect of the terms of the loans, i.e. the rate of  interest, duration and repayment holidays.  However, 
the financing should be on commercial terms and ai ming at a reasonable yield and risk-spread.   
  The lending should be on commercial terms but on a high risk level.  Only firms that are 
profitable or have reasonable prospects to become  profitable are eligible.  The Companies also  G/SCM/N/155/EEC/Add.25 
 Page 13 
 
 
  provide counseling.  The scheme may be comb ined with regional suppor t and support from NUTEK, 
in accordance with the state aid ru les in the European Community.   
  Loans:  High risk and slightly above ma rket rates. Bad collateral accepted.   
 
 Development capital:  High risk and bad or no collateral accepted.   
  Guarantees:  High risk and bad collateral accepted. Guarantee fee required.     New business loans:  The loan to start-ups is either a personal loan made out to the 
entrepreneur (injected into the company as restricted  equity) or a risk-carrying (unsecured) debenture 
loan to the company.  Maximum is 30 per cent of  the amount of financing, but the limit is 
SEK 1 million.  The loan runs for 10-15 years and is installment-free during the first years.  The loan 
is interest-free for two years, with reduced interest fo r three years;  from the sixth year market interest 
is paid.  An opening charge of 2 per cent on granted loans is payable and is deducted when the loan is 
paid.  Security is normally not necessary.   
  Supplementary loan:  If a company which h as been granted a loan for a new company 
requires further financing, a supplementary loan ma y be granted but only if there are good reasons for 
it, and if an application is received by the fund with in three years of the loan for a new company being 
granted.  Authorized applicants are private persons  or companies.  The applicant has to contribute 
with at least 10 per cent of the capital.  All sorts of businesses are eligible.   
 3.2 S
UPPORT TO SMALL COMPANIES  
 
(a) Form of subsidy 
 
 Grants.    
(b) Amount of subsidy 
 
 Net cost in SEK millions:  Calendar year  2004:  1
 
    2005:  0  
  Support is granted to a variety of projects  and can not be broken down per unit.   
 
(c) Policy objective 
 
 The primary objective is promotion of empl oyment-generating investments within small 
companies and balance within regions.    
(d) Duration 
  Programme commenced in 1994.  Duration until 31st of December 2001.  The programme 
has been terminated.    
(e) Statistical data  
  Support is granted to a variety of projects and sectors, therefore it is not possible to present 
statistical data permitting an assessment of trade effects.   G/SCM/N/155/EEC/Add.25 
Page 14  
 
  (f) Legal basis 
 
 The legal provisions are laid down in Gove rnmental ordinance:  SFS 1994:773 (Förordning 
om tillfälligt småföretagsstöd) , altered latest through SFS 19 99:16 (Förordning om ändring i 
förordningen (1994:773) om småföretagarstöd).   
 
(g) Rules and conditions 
 
 Support is handled by the County Administrative Boards (Länsstyrelse).  It is available to small companies throughout Sweden, with the excep tion of companies within the steel- or synthetic 
fiber industries.  Small companies are defined according to the European Commission definition as 
consisting of 50 employees or less and having an annual turnover of less than SEK 60 million.     Support is granted for investments estimated to  create long-term empl oyment opportunities.  
The prerequisites are that it does not contribute to the relocation of an activity from one county to 
another, nor to the reconstructing of an activity .  An activity that recently has undergone such 
reconstruction is also excluded from receiving suppor t.  Approved capital needed for the investment 
can not exceed SEK 20 million.  Support can be given with at most 15 per cent of total costs as long as it does not exceed the amount of funds needed  for the investment to take place.   
 3.3 I
NDUSTRIAL DEVELOPMENT CENTERS  
 
(a) Form of subsidy  
 
 Grants.    (b) Amount of subsidy 
 
 Net cost in SEK millions:  Calendar year  2005:  0
 
    2006:  0  
  Support is granted to a variety of projec ts and cannot be broken down per unit.   
 
(c) Policy objective  
 
 The primary objective is industrial developmen t of SMEs.  Secondary objective is aid for 
R&D.   
 
(d) Duration 
 
 The programme commenced as from February 1998.  Duration until 31st of December 2002.    
(e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis  
 
 The legal provisions are laid down in Gove rnmental decisions 1997-01-30, 2000-01-25, and 
2001-12-13.    G/SCM/N/155/EEC/Add.25 
 Page 15 
 
 
  (g) Rules and conditions  
 
 The support is distributed in the form of gran ts to regional Industrial Development Centers.  
The overall objective of the centers is to prom ote technological development in SMEs through a 
network approach.  Feasibility studies are carried out within the Industrial Development Centers, 
aiming at subsequent transfer to as well as fu rther development within SMEs as potential product 
concepts.  Even though the main rule is to cover actual costs incurred within the Industrial 
Development Centers, transfer could include an elem ent of subsidy that is maximized to 50 per cent in 
relation to the initial feasibility work costs.  The ac counted subsidy above refers to total costs within 
Industrial Development Center for feasibility studies.   
 
4. SUPPORT FOR EMPLOYMENT AND TRAINING 
 Labour market support is aimed at stimulating companies and authorities to hire individuals 
who face particular difficulties finding work, for instance youth, disabled, refugees and immigrants and elderly.  The support is generally given directly to the employer.  This kind of aid is intended to 
give an incentive for the employers to hire an individual they would not else have hired and to 
compensate for costs for training and equipment.     The scheme noted below, i.e. support for Voca tional Training is intended for companies and 
could be regarded to constitute a subsidy in the meaning of the WTO-agreement on subsidies.  As 
from 1999, previously reported programmes for Em ployment Aid and Training Aid have been 
amended in such a way that they are applied in a fully non-specific manner, thereby not constituting a 
subsidy in the meaning of the Ag reement on Subsidies and Countervailing Measures.  Hence they are 
not reported on in this report to the WTO.    4.1 S
UPPORT FOR VOCATIONAL TRAINING  
(a) Form of subsidy 
 
 Regular grants for on-the-job-training.    
(b) Amount of subsidy 
  Net cost in SEK millions:  Calendar year  2005:  0
 
    2006:  0  
  Support is granted to a variety of projec ts and cannot be broken down per unit.   
 (c) Policy objective 
 
 The primary objective of the scheme is to avoi d disruption in the production mainly in small 
and medium-sized companies due to lack of skilled workers, to avoid lay-off and to support workers 
in danger of losing their jobs.    (d) Duration 
 
 The programme commenced in 1984. Duration has not specified. Programme terminated 
in 2003.    (e) Statistical data 
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.   G/SCM/N/155/EEC/Add.25 
Page 16  
 
  (f) Legal basis 
 
 The legal provisions are laid down in the G overnmental ordinance SFS 1994:938 (Förordning 
om bidrag till utbildning i företag).  SFS 1994: 938 has expired and has been replaced as from 
1 September 2001 with Governmental ordinance SFS 2001:626 (Stöd till utbildning av anställda).   
 
(g) Rules and conditions 
 
 All firms, regardless of industry, are eligible.  Th e aid is in the form of a grant.  The rules in 
force as from 1 September 2001 allows for training aid up to 25 or 50 per cent of eligible costs during 
a 2 year-period, though under all circumstances maximized to a sum amounting to 55 200 SEK per 
person.  The conditions for the scheme follow th e rules stipulated in European Commission 
Regulation no 68/2001 on the application of articles 87 and 88 of the EC Treaty to training aid.   
 
5. EXPORT PROMOTION  
5.1 G
ENERAL EXPORT PROMOTION  
(a) Form of subsidy  
 
 The Swedish Government maintains an export promotion regime, whic h is operated by the 
semi-governmental Swedish Trade Council.  The Council assists the Swedish industry by offering 
various international trade consulti ng and marketing services that are ma inly provided on a fee basis. 
A company operating in Sweden has an option to – for a fee – to become a member of the Council 
and it can thereby obtain a discount on services and publications.     The state funding provided to the Council comprises the basic export-services such as answering trade-inquiries, providing information on the Council's activities, etc.   
 
(b) Amount of subsidy  
 
 Net cost in SEK millions: Calendar year  2005:  1
 
    2006:  0  
 
(c) Policy objective  
 
 The primary objective is to promote Swedish e xports and the internationalization of Swedish 
industry in order to achieve a long-term development of the Swedish economy.   
 (d) Duration  
 
 The Swedish Trade Council was formed in 1972 .  The government funding is allocated on a 
yearly basis but can vary somewhat from year to  year.  Duration has not been specified.   
 
(e) Statistical data  
  The support is granted to a variety of projects and sectors, therefore it is not possible to 
present statistical data permitting an assessment of trade effects.    
(f) Legal basis  
 
 An agreement between the government and th e General Swedish Export Association forms 
the legal basis for the Swedish Trade Council.  The latest revision of the agreement was made 
in 1998.    G/SCM/N/155/EEC/Add.25 
 Page 17 
 
 
  (g) Rules and conditions  
 
 The services of the Swedish Trade Council are av ailable for all firms re gardless of industry 
and their export volumes.  The internalisation of  SMEs is given priority.  The Swedish Trade 
Council's total turnover in 2006 was SEK 538 million.   
 
6. REGIONAL AID TO ENTERPRISES 
 Regional aid to enterprises in Sweden is granted within the framework following schemes 
reported below.  The main goal of Swedish regional policy is to promote sustainable growth, freedom 
of choice and a good environment, so that equal living conditions are creat ed for the citizens in 
whatever part of the country they live.  An activ e regional policy has for many years been of major 
importance due to the special living-cond itions in large parts of Sweden.   
 6.1 R
EGIONAL DEVELOPMENT GRANT  
 This scheme has been modified and replaced by another scheme, Modification of schemes 
N596/04 - N201/03 and N646/99 - Regional Invest ment Grant (ex Regional Development Grant).   
 
(a) Form of subsidy  
 
 Grants for tangible or intangible investments.  The grants can be reclaimed if the objectives 
are not fulfilled.   
 
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005:  364  
    2006:  410  
 
 Support is granted to a variety of sectors and r ecipients and cannot be broken down per unit.   
 
(c) Policy objective 
 
 The programme is administrated by The Swedish Business Development Agency, NUTEK. 
The program supports investments in tangible and in tangible investments.  The primary objective is 
regional aid in designated areas.  The secondary obj ective is aid to SMEs, employment and R&D in 
designated areas.  The main objective is to promote development of industry in designated areas.   
 
(d) Duration  
 
 The programme commenced as from 1st of July 1990.  Duration formally decided for every 
new fiscal year.    
(e) Statistical data  
  The support is granted to a variety of projects and sectors, therefore it is not possible to 
present statistical data permitting an assessment of trade effects.   
 
(f) Legal basis  
 
The legal provisions are laid down in  the Governmental Ordinance SFS 2000:279 
(Förordningen om regionalt utvecklingsbidrag) and SFS 1999:1382 (Förordningen om stödområden 
för vissa regionalpolitiska företagsstöd).   
 G/SCM/N/155/EEC/Add.25 
Page 18  
 
  (g) Rules and conditions 
 
 Eligible are natural or juridical persons ope rating in Sweden and public authorities working 
with viability in certain competitive sectors on mark et conditions.  In certain cases aid can also be 
granted to non-profit associations.  The firm must be  profitable.  In order to promote equality between 
men and women there is also a rule that at least 40 per cent of the new jobs created in each project 
shall be reserved for each sex.  The total grant element may not exceed the maximal aid intensity 
allowed in each designated area.     Regional Development Grants can be awarded in connection with investments in buildings, 
machinery, etc.  It can also be awarded for in tangible investment, such as investments in patent, 
licenses, marketing activities, development of new pr oducts and education.  The form of the aid is a 
grant, which can be reclaimed if the objectives, are not fulfilled.     The grant is awarded discretionary accordi ng to the calculated need for each individual 
project, the size of the investments, the number of ne w jobs, etc.  Maximal intensity is 35 per cent of 
eligible investment costs in aid area A and 25 per cent in aid area B.  In some cases the maximal 
intensity is lower and in exceptional cases it ca n be higher, maximum 75 per cent.  The maximum 
grant is 35 per cent of eligible investment in regi onal aid area A.  In aid area B the maximum grant is 
25 per cent.    
 The awarding of a grant has many reasons.  For example:  The cost of building is higher in 
the designated areas because of climatic reasons, trans port costs, etc.  It is more difficult to finance 
these investments on the regular credit market be cause of their low alternative value.   
  The main rule is that the grant is taxable as an  income to the recipient. The general level for 
corporate income taxes is about 28 per cent flat  rate.  In Sweden, the value of buildings may 
depreciate at rates varying from 2 to 5 per cent pe r annum, depending on the type of the building.  
Machinery is normally depreciated during a 5 year period.  The grant can be awarded either by the Government, the Swedish Business Development Agency, NUTEK or the County Administrative 
Boards.    
6.2 L
OANS TO REGIONAL INVESTMENT COMPANIES  
 The programme expired in the spring 2001.  No payments since the year 2001.   
 6.3 E
MPLOYMENT GRANT  
(a) Form of subsidy  
 
 Grants.    
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005:  43
 
    2006:  45  
  The aid intensity in regional aid area A:  A total sum of SEK 200 000 per additional year of work allocated according to a uniform scheme during a five year period.    
 The aid intensity in regional aid area B:  A total sum of SEK 120 000 per additional year of 
work allocated according to a uniform scheme during a five year period.    G/SCM/N/155/EEC/Add.25 
 Page 19 
 
 
  (c) Policy objective  
 
 The objective is regional aid to designated areas and employment in designated areas.  The scheme is aimed at creation of new employment by reducing the extra costs during the first years when taking on additional labour.    (d) Duration  
 
 The programme commenced as from 1st of July 1990.  Duration formally decided for every 
new fiscal year. 
 
(e) Statistical data 
 
 The support is granted to a variety of sectors and recipients, therefore it is not possible to present statistical data permitting an assessment of trade effects.    (f) Legal basis 
 
 The legal provisions are laid down in the G overnmental ordinance SFS 1998:996 (Förordning 
om sysselsättningsbidrag).    (g) Rules and conditions 
 
 The programme is administrated by the C ounty Administrative Boards (Länsstyrelsen).  
Eligible for aid are public authorities, natural or ju ridical persons operating in Sweden and working in 
competitive sectors on market conditions.   
 
 In some cases aid can also be granted to non- profit associations.  There is a requirement that 
at least 40 per cent of the new jobs created is reser ved for each sex.  Grants are awarded according to 
the amount of new jobs created measured in additio nal man-years (i.e. total net increase of working 
hours performed by employees in companies applying and eligible for aid).  If the number of additional work is exceeding ten years, the appli cations are examined from the company's economic 
point of view.  Support is only granted for employment  that is considered fixed and the employer shall 
supply training in the form of theory or practice of at least 125 hours during a period of 2 years.     The aid intensity in regional aid area A:  A total sum of SEK 200 000 per additional year of work allocated according to a uniform scheme during a five year period.   
 
 The aid intensity in regional aid area B:  A total sum of SEK 120 000 per additional year of 
work allocated according to a uniform scheme during a five year period.    
Year  Aid area A  Aid area B  
1 60 000 40 000 
2 50 000 30 000 
3 40 000 25 000 
4 30 000 15 000 
5 20 000 10 000 
Total 200 000 120 000 
 G/SCM/N/155/EEC/Add.25 
Page 20  
 
  6.4 R
EGIONAL TRANSPORT GRANT  
(a) Form of subsidy  
 
 Grants.    (b) Amount of subsidy  
 
 Net cost in SEK millions: Calendar year   2005:  380
 
    2006:  491  
 
 Support is granted to a variety of sectors and r ecipients and cannot be broken down per unit.   
 
(c) Policy objective  
 
 The primary objective is regional aid to designated areas.  The objective of the grant is to 
partly compensate for high transport costs due to long distances to the main markets.  It is important 
to create new employment and to maintain employme nt in those areas in Sweden where the cost of 
transport is considerably higher than in the rest of the country.  Hereby these companies are put on 
more equal footing when competing with compani es situated closer to the large markets.   
 
(d) Duration  
 
 The scheme commenced in 1971.  Duration form ally decided for every new fiscal year.   
 
(e) Statistical data  
  The support is granted to a variety of sectors and recipients, therefore it is not possible to 
present statistical data permitting an assessment of trade effects.    
(f) Legal basis  
 
 The legal provisions are laid down in the Governmental ordinance:  SFS 2000:281.  
(Förordningen om regionalt transportbidrag).   
 
(g) Rules and conditions  
 
 The programme is administrated by the Sw edish Business Development Agency, NUTEK.   
 
 Eligible are Swedish natural or juridical pe rsons, foreign company branches in Sweden or 
foreign natural persons living in Sweden.     The assisted projects:  Actually paid domestic  transport costs from the regional aid area for 
goods that have been produced or manufactured (p rocessed) in this area (except for certain products 
like pulp, paper, metals, certain st eel products and iron ore).  Trans port costs for raw materials that 
shall be processed in the regional transport aid area are also eligible.  However, in principle, materials 
from outside the aid area that are also produced in the aid area are not eligible.  The goods transported 
must be highly processed in order to be eligible.  The grant is awarded automatically after application 
if all the conditions are fulfilled.  As from 1 of July 1995 regional transport aid was terminated in 
12 municipalities outside the regional aid areas appr oved by ESA, i.e. outside areas with population 
density above 12,5 inhabitants per square kilometers.   
  The regional aid area for transport is divided into  five zones.  The percentages of the transport 
costs that are covered appear in the following table:    G/SCM/N/155/EEC/Add.25 
 Page 21 
 
 
   
Distance 
in 
kilometers   Transport 
aid zone 
2 Transport 
aid zone 
3 Transport 
aid zone 
4 Transport 
aid zone 
5 
401 – 700   15% 25% 30% 30% 
701 -   15% 25% 30% 45% 
 
6.5 T HE FUND FOR NORTHERN SWEDEN  
 The Fund has been operating with two different types of activities:   
 
- loans, including guarantees and conditional loans given primarily to small and medium sized 
companies within the industrial and service sector.   
- guarantees and project support given to institutions  or projects and research of infrastructure 
character (for example, research activities at uni versities and colleges, foundations of research 
bodies outside the university sphere).  As from 1994 the Fund has primarily concentrated on 
the loan operation.   
 
(a) Form of subsidy  
  Mainly loans at market conditions.  No subsid ies, risk-sharing. Conditional loans, guarantees, 
grants and project support.    
(b) Amount of subsidy  
  Net cost in SEK millions:  Calendar year  2005:  15
 
    2006:  0  
 
 Support is granted to a variety of projects and recipients and cannot be broken down per unit.   
 
(c) Policy objective  
 
 The primary objective is regional aid to designa ted areas.  The secondary objective is aid to 
SMEs and R&D.  The aim of the fund is to promot e development mainly of SMEs, at present, in the 
5 northernmost counties.    (d) Duration 
 
 The scheme commenced in 1961.  Du ration has not been specified.   
 
(e) Statistical data 
  The support is granted to a variety of projects and sectors, therefore it is not possible to 
present statistical data permitting an assessment of trade effects.    
(f) Legal basis 
  Government Decision 1961, the latest revision in 1995.   
 
(g) Rules and conditions 
 
 Expenditure eligible for financing is pr oduct development, marketing, fixed assets and 
working capital.  If loans from the Fund Northern Sweden are combined with Regional Development G/SCM/N/155/EEC/Add.25 
Page 22  
 
  aid, the state financing may only amount to 70 per cent of investment costs in aid area 1 and 50 per 
cent in aid area 2 and structural aid areas.  The government can decide that these levels may be exceeded if there is a special priority.     7. ENVIRONMENT AID 
7.1 G
RANTS FOR LOCAL INVESTMENT PROGRAMMES FOR ECOLOGICALLY SUSTAINABLE 
DEVELOPMENT (LIP) 
(a) Form of subsidy 
  Grants.   
 
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005:   26
4  
    2006:   625 
 
 Support is granted to a variety of projec ts and cannot be broken down per unit.   
 
(c) Policy objective  
  Primary objective is to obtain higher levels of environmental protection compared to what is 
demanded by international standards.    
(d) Duration  
  The programme commenced as from February 1998 and expired as from 
31
st of December 2001.   
 
(e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to 
present statistical data permitting an assessment of trade effects.   
 
(f) Legal basis  
 
 The legal provisions are laid down in the Governmental ordinance SFS 1998:23 (Förordning 
om statliga bidrag till lokala investeringsprogram som ökar den ekologiska hållbarheten i samhället) 
and SFS 1999:755 (Förordning om ändring av 1998:23), and SFS 2001:1165 (Förordning om 
upphävande av 1998:23).    
(g) Rules and conditions 
 
 Support is granted to local investment programmes administered by municipalities, which 
contributes to ecologically sustainable development through a.o. increased efficiency in the use of 
energy and other natural resources, use of renewabl e raw materials and recycling measures.  The grant 
is to be given to investments that are implemen ted beyond the present international standard, that 
develops the technology and that has obvious effects on employment.  Support to firms is not to cover 
more than 30 per cent of the additional costs that arise due to upgrading of investments into a more 
                                                     
 
4 The reported figures for payments and the share to industry are estimated figures.   
5 The reported figures for payments and the share to industry are estimated figures.    G/SCM/N/155/EEC/Add.25 
 Page 23 
 
 
  environmentally friendly direction.  Investment s should be restricted to land, buildings and 
equipment.  When aid is given together with othe r forms of state aid the maximum aid level apply to 
the combined aid.    7.2 I
NVESTMENT GRANT FOR CERTAIN INVESTMENTS WITHIN THE ENERGY SECTOR  
(a) Form of subsidy 
 
 Grants.  
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005:  0
 
    2006:  0  
  Support is granted to a variety of projec ts and cannot be broken down per unit.   
 
(c) Policy objective  
 
 Primary objective is to encourage use of sustainable sources of energy within electricity production.    (d) Duration  
 
 The programme started in February 1998 and is  running for a five year period.  Programme 
was terminated in 2005.    (e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis  
 
 The legal provisions are laid down in the Governmental ordinance SFS 1998:22 (Förordning om statligt bidrag till vissa investeringar inom energiområdet).    
(g) Rules and conditions 
  Support is granted to investments in combined  power and heating plants for bio-fuel, wind 
power stations and small-scale hy droelectric power stations.  Maxi mum support to investments in bio-
fuel combined power and heating plats is 25 per cent of the total investment costs.  Maximum aid to investments in wind power stations is 15 per cent of the costs that can receive support.  This 15 per 
cent can rise to maximum 30 per cent when cumulative aid is present.  Eligible costs are expenses for 
building, construction and equipment with the restri ction to the extra investment costs necessary for 
carrying through the project.     7.3 S
UPPORT TO SMALL SCALE ELECTRICITY PRODUCTION  
 Programme terminated.   
 
(a) Form of subsidy 
 
 Grant to production costs.   G/SCM/N/155/EEC/Add.25 
Page 24  
 
  (b) Amount of subsidy 
 
 Net cost in SEK millions:  Calendar year  2005:  0
 
       2006:  0  
 
 Subsidy per unit amounts to 9 öre per KwH produced in small scale energy facilities.   
 
(c) Policy objective 
 
 The objective of the support is to ensure vi ability for small scale producers of electricity, 
sourcing from environmental friendl y and renewable energy producti on, i.e. windmills, hydro power 
and CHP (Combined Heat and Power) plants.  To be  commercially competitive within the deregulated 
Swedish electricity market, small scale producers need compensation for additional production costs 
compared to operators providing electricity from  traditional and non-renewable energy sources.   
 (d) Duration 
 
 Present aid scheme started 1st of November  1999.  Duration until 31st of December 2002.  
The programme was terminated in the year 2003.    
(e) Statistical data 
 
The share of small scale and renewable electri city production corresponds to 1,5 percent of 
total energy production.  Trade effects are estimated to be negligible.   
 
(f) Legal basis 
 
 The legal provisions are laid down in SFS:   2000:614 (Förordning om stöd till småskalig 
elproduktion).    
(g) Rules and conditions 
  Aid is awarded at an amount of 9 öre (about 0,01 euro) per KwH produced in small scale 
energy facilities.  For administrative reasons aid is given to purchasers of electricity produced by 
small scale producers, the latter defined as plants no t capable of delivering an  output higher than 
1500 kW.  An agreement between producer and purch aser must be established, certifying that aid will 
be transferred to the producer.   
 
7.4 S
UPPORT TO WIND POWER PRODUCTION  
(a) Form of subsidy 
 
 Tax reduction.    (b) Amount of subsidy 
 
 Net cost in SEK millions:  Calendar year  2005:  87
 
       2006:  64  
 
 The subsidy was 18,1 öre per KWh produced at wind power plants in 2003.  In 2004, the 
subsidy was differentiated and reduced.  For la nd based wind power the level was 12 öre per KWh 
and for offshore wind 17 öre.    G/SCM/N/155/EEC/Add.25 
 Page 25 
 
 
  (c) Policy objective 
 
 The objective of the support is to ensure  viability for producers of wind energy.   
  To be commercially competitive within the deregulated Swedish electricity market, wind 
energy producers need compensation for additional production costs compared foremost to operators 
providing electricity from trad itional and non-renewable energy sources.  However, due to 
particularly high production costs for wind power, add itional compensation in the form of tax relief is 
awarded and can be cumulated with support for small scale electrical producers, see 7.3 above.   
 (d) Duration 
 
In January 2005, the European Comm ission approved the state aid until 
31
st of December 2009.  
 (e) Statistical data 
 
 The share of small scale and renewable el ectricity production, including a.o. wind power, 
corresponds to 1,5  percent of total energy production.   Trade effects are estimated to be negligable.   
 
(f) Legal basis 
 
 The legal provisions are laid down in SFS:  1994:1776 (Lag om skatt på energi), Act of 
Excise Duties on Energy, chapter 11, § 10.    
(g) Rules and conditions 
 
 Tax relief is given amounting to 18,1 öre pe r KwH during 2001 and 2002.  The amount of aid 
corresponds to the tax level for energy paid by in dividual consumers during 2001.  For administrative 
reasons the relief is given to purchasers/distributors of electricity, which subsequently is to be transferred to the producers of wind power.    
7.5 M
ANUFACTURING INDUSTRY TAX RELIEF – CO2  AND ENERGY TAXES ON FOSSIL FUELS  
 Manufacturing industry tax relief – CO2 and energy taxes on fossil fuels (N588/2005) 
(prolongation).    
(a) Form of subsidy 
 
 Tax reduction.    
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005:  5510
 
       2006:  5700  
  Support is granted to a variety of projec ts and cannot be broken down per unit.   
 
(c) Policy objective  
 
 Competitiveness of Swedish Manufacturing Sector (energy).  G/SCM/N/155/EEC/Add.25 
Page 26  
 
  (d) Duration 
 
 1 January 2006 until 31 of December in 2011.    
(e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.   
 
(f) Legal basis 
  Lagen (1994:1776) om skatt på energi (6 a kap. 1 §9).   
 
(g) Rules and conditions 
  - 
 7.6 R
ELIEFS FROM ENERGY AND CO2  TAXES FOR FUELS USED FOR HEAT PRODUCTION IN CHP S 
 Reliefs from energy and CO2 taxes for fuels used for heat production in CHPs (N594/2005).   
 
(a) Form of subsidy 
 
 Tax reduction.    
(b) Amount of subsidy  
  Net cost in SEK millions:  Calendar year  2005:  1420
 
       2006:  1380  
 
(c) Policy objective 
 
Competitivness of certain CHP's (district heating).   
 
(d) Duration 
 
1 January 2006 until 31 of December 2011.   
 (e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis 
 
 Lagen (1994:1776) om skatt på energi (6 a kap. 3 §).   
 
(g) Rules and conditions 
  -   G/SCM/N/155/EEC/Add.25 
 Page 27 
 
 
  7.7 CO2  TAX RELIEF FOR THE MANUFACTURING SECTOR (0,8  RULE ) 
 CO2 tax relief for the manufacturing sector (0,8 rule) (N 595/2005).   
 
(a) Form of subsidy 
  Tax reduction.   
 
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year    2005:  157
 
       2006:  159  
 
(c) Policy objective 
 
 Competitiveness of the energy intensive I ndustry's CO2 Tax reliefs into 2006.   
 
(d) Duration 
 
 1 January 2006 to 31 of December in 2006.   
 
(e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis 
  Lagen (1994:1776) om skatt på energi (9 kap. 9 §).   
 
(g) Rules and conditions  
 -  
7.8 E
NERGY TAX RELIEF ON ELECTRICITY FOR THE MANUFACTURING SECTOR  
 Energy tax relief on electricity for the manufacturing sector (N 596/2005).   
 
(a) Form of subsidy 
 
 Tax reduction.    
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005:  12 310
 
       2006:  12 630  
 
(c) Policy objective 
 
 Competitiveness of the Swedish Manufacturing Sector.    
(d) Duration 
 
 1 January 2006 to 31 of December in 2011.   G/SCM/N/155/EEC/Add.25 
Page 28  
 
  (e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    (f) Legal basis  
 Lagen (1994:1776) om skatt på energi (11 kap. 3 §).   
 
(g) Rules and conditions 
 
 -  7.9 W
ASTE TAX CONCESSION  
(a) Form of subsidy 
 
 Tax reduction.    
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005: 0
 
    2006:  0  
 
Subsidy per unit is SEK 250 (27 Euro) per ton of w aste, i.e. equivalent to the stipulated tax 
level .   
 (c) Policy objective  
 
 Tax reduction for certain categories of waste is  motivated for environmental reasons.  In cases 
where, according to present technology, it is not possi ble to process or recycle waste in order to avoid 
deposition, a tax reduction has been deem ed as an appropriate measure.   
 (d) Duration  
 
 As from 1st of January 2000 until further notice.   Programme terminated in the year 2004.   
 
(e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.    
(f) Legal basis  
  The legal provisions are laid down in  the Act on Waste tax (SFS 1999:673).   
 
(g) Rules and conditions 
 
 The objective of the introduction of a general ta x on waste is to give an incentive for reducing 
the total amounts of waste to be deposited.  In othe r words, the tax is supposed to encourage recycling 
or increased use of waste for energy purposes.  The stipulated tax to be paid for waste deposited is 
SEK 250 per ton.     G/SCM/N/155/EEC/Add.25 
 Page 29 
 
 
   However, for certain categories of (foremost toxic) waste it has b een acknowledged, that 
alternatives to deposition are very few and that full  tax reduction is appropria te in order to avoid 
environmentally negative effects, such as dumping or unsafe storage.    7.10 G
RANTS FOR CLIMATE INVESTMENT PROGRAMMES (KLIMP ) 
(a) Form of subsidy 
 
 Grants.    
(b) Amount of subsidy  
 
 Net cost in SEK millions:  Calendar year  2005:  46
 
    2006:  2076 
 
Support is granted to a variety of projects  and cannot be broken down per unit.   
 
(c) Policy objective  
 
 Primary objective are to reduce emissions of greenhouse gases, to help to bring about conversion to alternative energy sources and to sav e energy.  The programmes focus on the areas of 
energy, waste managment and transport sectors.  Th e programmes must also include measures focusing 
on public education and information.   
 
(d) Duration  
 
 The first Klimp grants were allocated in Dece mber 2003.  The programme will be in effect 
until 2006.   
 
(e) Statistical data  
 
 The support is granted to a variety of projects and sectors, therefore it is not possible to present statistical data permitting an assessment of trade effects.   
 
(f) Legal basis  
 
 The legal provisions are laid down in the G overnmental ordinance SFS 2003:262 (Förordning 
om statliga bidrag till klimatinvesteringsprogr am) and SFS 2003:566 (Förordning om ändring i 
förordningen (2003:262) om statliga bidrag till klimatinvesteringsprogram.   
 
(g) Rules and conditions 
 
 Support is granted to local climate investme nt programmes administered by municipalities, 
which contributes to the reduction of greenhouse gases in Sweden.  The programmes should be 
formed in cooperation with other participants.   
  Grants can be approved to specific measures or  to a package of measures without a complete 
investment program if those measures are regarded as especially efficient in reducing the emissions of 
greenhouse gases.  Grants can only be given to cost effective measures.   
 
                                                     
 
6 The reported figures for payments and the share to industry are estimated figures.   G/SCM/N/155/EEC/Add.25 
Page 30  
 
  APPENDIX:  THE NET COST METHOD 
 The objective of the net cost to government (N CG-method) is to obtain a consistent measure 
of government aid, where support from various instru ments, i.e. grants, loans, guarantees, equity 
injections and tax concessions, are added.  The NC G-method is used by OECD in its project "Public 
support to industry".   
 
 Net costs are calculated as follows:    Grants
:  Actual amounts paid out minus repayments and royalties if any.   
 
Guarantees :  Claims paid minus fees received and recoveries.   
 Loans
:  Estimated capital cost based on the differe nce between the government borrowing rate and 
actual interest payments received.    
Equity capital
:  Estimated capital cost based on the government borrowing rate and dividends 
received.    Tax concessions
:  Estimates of revenue forgone.   
 Capital against Royalty:
  Estimated capital cost based on the difference between the government 
borrowing rate and actual royalty payments received.   
  It should be noted that the net cost does not co rrespond to the actual transfer of funds from the 
government to the firms in any given year, i.e. th e expenditure as reported in the government budget.  
Instead the purpose is to indicate the net cost to  government of support to industry.  Since imputed 
capital costs on previous loans and equity injections  are included, the net cost figures to a certain 
extent reflect past policies.  If the net cost of a pr ogramme is negative, that is, if the government earns 
money because of high repayments or interest rates, the net cost is reported as nil (0).     The NCG-method is not a direct guide to determ ine the extent of distortion of competition nor 
to approximate the ultimate benefit to industry.  Ho wever, the NCG is a useful guide to the evolution 
and the structure of government support over time.   
   
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