WORLD TRADE  
ORGANIZATION  G/SCM/N/123/EEC/Add.9 
26 August 2005 
 (05-3594) 
  
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 Community relates to subsidy 
programmes of Germany . 
 
_______________ 
 
   
 
 
 
 G/SCM/N/123/EEC/Add.9 
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GERMANY  
 
TABLE OF CONTENTS 
 
 Page  
I. GERMAN SHIPYARDS (WERFTHILFEN).........................................................................3 
II. GERMAN SHIPYARDS (WETTBEWERBSHILFE) ..........................................................3 
III. REDUCTION OF RATE S ON INHERITABLE LAND-USE RIGHTS (BERLIN) ..........5 
IV. JOINT SCHEME ON "IMPROVING THE REGIONAL ECONOMIC STRUCTURE" 6 
V. REGIONAL ECONOMIC SUPPORT PROGRAMME (LAND NORDRHEIN-
WESTFALEN) ..................................................................................................................... .....7 
VI. PROMOTION OF EFFICIENT USE OF ENERGY; PROGRAMME SECTION 
"PROMOTION OF TECHNOLOGICAL DEVELOPMENT (REN/TE)" (LAND 
NORDRHEIN-WESTFALEN)................................................................................................8 
VII. REGIONAL AID PROGRAMME  (LAND RHEINLAND-PFALZ) ...................................9 
VIII. NATIONAL PROGRAMME FOR CI VIL AERONAUTICAL RESEARCH....................9 
IX. PULP MILL STENDAL (SACHSEN-ANHALT)................................................................10 X. CORRUGATED BASE PAPE R PLANT (BRANDENBURG)...........................................11 
XI. FAIRCHILD DORNIER (FOR IN FORMATION REASONS ONLY).............................11 
  G/SCM/N/123/EEC/Add.9 
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 I. GERMAN SHIPYARDS (WERFTHILFEN) 
1. Name of the subsidy scheme or ad hoc subsidy  
  Interest-Rate Grants to Finance Orders  to German Shipyards ("Werfthilfen")  
 
2. Form of the subsidy
 
  Grant  
3. Subsidy per unit
 
  Total amount of assistance provided in 2003/2004   Total amount of assistance provided in 2003:  35,1 Mio. Euro  
 Total amount of assistance provided in 2004: 25,8 Mio Euro 
 4. Objective and/or purpose of the subsidy
 
 
The eighth shipyard assistance programme (VIII.  Werfthilfeprogramm) exists to provide non-
repayable interest-rate grants under the relevant  OECD Understanding On Export Credits For Ships 
(1981). In the frame of this Export Credit Agreem ent, which expired in April 2002, only legal 
obligations from previous years will be completed.  
Legal basis:  Commitment authorizations  in the Federal budget from previous years 
 Guidelines from the Federal Ministry of Economics and Technology 
 
Modes of payment:  Support is given to the construction and rec onstruction of high-technology marine vessels 
(merchant vessels), respecting the OECD U nderstanding On Export Credits For Ships: 
 8.5 year term 
 20 per cent advance payment  Minimum interest rate of 8 per cent p.a..  5. Duration of subsidy and other time-limits attached to it
 
 
 No new committments  6. Statistical data permitting an assessmen t of the trade effects of a subsidy
 
 
n.a. 
 
II. GERMAN SHIPYARDS (WETTBEWERBSHILFE) 
1. Name of the subsidy scheme or ad hoc subsidy  
  Competition Aid for German Shipyards (Wettbewerbshilfe) 
 
2. Form of the subsidy
 
  Grant  G/SCM/N/123/EEC/Add.9 
Page 4 
 
 
 3. Subsidy per unit  
 
Total amount of assistance provided in 2003: 122,7 Mio. Euro 
 
 Total amount of assistance provided in 2004:  96,3 Mio, Euro 
 4. Objective and/or purpose of the subsidy
 
 
Grant towards production costs are given, where they are permissible under the relevant EU 
directive on shipbuilding subsidies (COMReg. (EC) 1177/202) and COM Reg. (EC) No.502/2004 
 
Legal basis:  Commitment authorizatio ns in the Federal and Länder budgets. 
Guidelines from the Federal Ministry of Economics and Labour  
Modes of payment:  Those receiving the grants  are shipbuilding companies in the Federal 
Republic of Germany. 
 
Support is given namely to the construction of container ships, product and chemical tankers 
and LNG carriers (Liquified Natural Gas carriers)  
Support of 6% of contract value before aid 
 5. Duration of subsidy and other time-limits attached to it
 
 
In the frame of Commission Regulation (EC) No 1177/2002 / COMReg. (EC) No. 502/2004 
Limited to contracts signed before 31.3.2005 
 6. Statistical data permitting an assessmen t of the trade effects of a subsidy
 
  n.a.  
3. Bavarian Regional Programmes in Support of Commerce and Industry
 
 
Name of the subsidy scheme or ad hoc subsidy 
 
Bavarian programmes in support of commerce a nd industry (as promulgated by the Bavarian 
Ministry of Economics, Transport and Tec hnology on 22 February  2002, No.3540-III/2-3540 
 2. Form of the subsidy
 
 
Investment grant. Interest rate subsidy (to subsidize loans). 
 
3. Subsidy per unit
 
 
Total support 2003 2004 (Mio. Euro) Investment grant 117,8 73,4 
Interest rate subsidy 8,8 10,5 
Assisted investment volume 1.016,0 706,9 Number of assisted companies 498 387 
  G/SCM/N/123/EEC/Add.9 
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 4. Objective and/or purpose of the subsidy  
 
Aid to finance investments in trade, industr y and tourism to create and secure jobs and 
training places in assisted areas. 
 
Objective:  Improving regional econom ic structures and tourism offers; 
Increasing the economic strength of structurally weak areas.  5. Duration of subsidy and other time-limits attached to it
 
 
Until 30 June 2007 
 6. Statistical data permitting an assessmen t of the trade effects of a subsidy
 
 
Not available.  Outside the assisted areas pursu ant to the Joint Federal Government/ Laender 
Scheme for the Improvement of Regional Economic Structures, support is restricted to small and 
medium-sized enterprises (SMEs) within the meani ng of the Decree (EC) Nr.70/2001 of the European 
Commission on State Aid to SME's ( EC L 10/33 dated 12 January 2001)  
III. REDUCTION OF RATES ON INHERITABLE LAND-USE RIGHTS (BERLIN) 
1. Name of the subsidy scheme or ad hoc subsidy
 
 
Reduction to between 3 and 5 per cent of the ra tes payable on inheritable land-use rights in 
the case of projects worthy of special promotion of manufacturing firms depending on the degree of use of the buildings 
 
2. Form of the subsidy
 
 
Cutting land costs by granting a reduced rate on land-use rights. 
 3. Subsidy per unit
 
 
Payments:  31.069,67 € in 2003 Payments:  31.069,67 € in 2004 
 4. Objective and/or purpose of the subsidy
 
 
Reducing land acquisition costs for the manuf acturing industry for regional promotion 
purposes.  5. Duration of subsidy and other time-limits attached to it
 
 
Until 31 December 2006 
 6. Statistical data permitting an assessmen t of the trade effects of a subsidy
 
 
The effects of the subsidy in accordance with  WTO standards cannot be assessed due to the 
low financial resources. 
 G/SCM/N/123/EEC/Add.9 
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 5. Consolidation programme of  the Land Mecklenburg-Vorpommern  
 1. Name of the subsidy scheme or ad hoc subsidy
 
 
Consolidation programme of the Land Meckle nburg-Vorpommern on the granting of public 
financial aid to small and medium-sized commerc ial and industrial enterprises – special fund to 
support companies  2. Form of the subsidy
 
 
Loans of up to 2,5 million Euro at market conditions. Usually restricted to SMEs within the 
meaning of the Community Framework.  3. Subsidy per unit
 
 
Approved loans in 2003: 1.680 Mio. Euro 
Disbursed loans in 2003: 1.656 Mio. Euro Approved loans in 2004: 2.280 Mio. Euro Disbursed loans in 2004: 1.730 Mio. Euro 
 
4. Objective and/or purpose of the subsidy
 
 
Liquidity aid for enterprises that are importan t for a region in Mecklenburg-Vorpommern in 
terms of labour-market policy and structural policy.  
5. Duration of subsidy and other time-limits attached to it
 
 
The loans have a maximum duration of ten years. 
 6. Statistical data permitting an assessmen t of the trade effects of a subsidy
 
 
Statistics are not available to assess the trade e ffects of the subsidy.  Most of the assisted 
enterprises operate on regional markets only.  
IV. JOINT SCHEME ON "IMPROVING THE REGIONAL ECONOMIC STRUCTURE" 
1. Name of the subsidy scheme or ad hoc subsidy
 
 
Joint Scheme on "Improving the Regional Economic Structure". 
 2. Form of the subsidy
 
 
Regional assistance in the form of investment  grants and, exceptionally, loan guarantees 
 
3. Subsidy per unit  
 
Generally speaking budget allocations fo r the Scheme have been decreased. 
 
In 2003, a total amount of 1,100 Mio. Euro was disbursed by the „Länder“ under the Scheme 
in order to promote business (commercial and industr ial) investments. 86.3 % of this amount (0,955 
Mio. Euro) was paid out by the Eastern Länder and Berlin. The amounts indicated federal co-financial 
contributions.   G/SCM/N/123/EEC/Add.9 
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 In 2004, a total of 1,170 Mio.. Euro as disbursed by the Länder under the Joint Scheme in 
order to promote business (commerc ial and industrial) investments.  89.3 % of this amount (1,045 
Mio. Euro) was paid out by the Eastern Länder and Berlin. The amounts indicated include federal co-financial contributions. 
 
4. Objective and/or purpose of the subsidy
 
 
The primary regional policy objective is to enable structurally weak regions to keep pace with 
general economic development by  offsetting locational disadvantages and reducing regional 
development differentials.  Regional structural  policy focuses on supporting regional development 
activity with a view to raising the levels of empl oyment and income in problem areas in this way.  
Eligible for subsidies under this schem e are commercial and industrial firms. 
Investments in commerce and industry are eligible fo r promotion if they generate additional income to 
the region so that the region's total level of income  is raised to a not insignificant extent in the long 
run (primary effect).  This is deemed to be the case if the company applying for subsidy payment sells 
the better part of its products or services on a supr aregional basis. The investment projects concerned 
must create new jobs in the assisted areas or secure existing ones. Assisted areas are redefined at multiannual intervals on the basis of regional indicators (level of 
income, unemployment, infrastructure). Assisted ar eas in the original Länder including Berlin (West) 
cover 17.7 per cent of the German population in the period from 2000 to 2006. The new Länder and 
Berlin (East) represent assisted areas in their entity till 2006. Moreover, these areas have been 
recognized as objective-1 areas within the framework  of the EC Structural Funds until the end of 
2006.  5. Duration of subsidy and other time-limits attached to it
 
 
Regional assistance consists of a non-recurring paymen t and is granted to investment projects in 
assisted areas. The programme is under no time-limit.  6. Statistical data permitting an assessmen t of the trade effects of a subsidy
 
 
Regional promotion is aimed at offsetting dom estic investment disadvantages of certain 
regions and contributes to raising the levels of in come and employment in structurally weak areas.  
Promotion under the Joint Scheme therefore is ne utral in terms of competition and has no effect on 
competition in international trade.  V. REGIONAL ECONOMIC SUPPORT PROGRAMME (LAND NORDRHEIN-
WESTFALEN) 
 
1. Name of the subsidy scheme or ad hoc subsidy
 
 
Regional Economic Support Programme 
 
2. Form of the subsidy  
 
Grants towards investment projects of trade and industry and local infrastructure. 
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 3. Subsidy per unit  
 
The total amount budgeted for 2003: 88,1 Mio. Euro Total number of recipients:   88 
 
The total amount budgeted for 2004: 70,0 Mio. Euro Total number of recipients:  18 
 4. Objective and/or purpose of the subsidy
 
 
Improving the regional economic structure and supporting small and medium-sized 
businesses.  5. Duration of subsidy and other time-limits attached to it
 
 
Not limited 
 6. Statistical data permitting an assessmen t of the trade effects of a subsidy
 
 
Given the objectives of the programme, trade effects cannot be assessed. 
 
VI. PROMOTION OF EFFICIENT USE OF ENERGY; PROGRAMME SECTION 
"PROMOTION OF TECHNOLOGICAL DEVELOPMENT (REN/TE)" (LAND NORDRHEIN-WESTFALEN) 
 1. Name of the subsidy scheme or ad hoc subsidy
 
 
Promotion of efficient use of energy; programme section "promotion of technological 
development (REN/TE)". State subsidy N 497/94.  2. Form of the subsidy
 
 
Grant 
 3. Subsidy per unit in 2003
 
 
Approx.:  € 2.482.000 
Total number of recipients: 5 (five) 
 
The programme REN/TE was not continued in 2004. 
 4. Objective and/or purpose of the subsidy
 
 
The promotion section "technological development" supports companies in the fields of 
energy technology, the energy industry and commercial and industrial energy users in North-Rhine/Westphalia. The subsidy is granted for the development of new products and processes for the 
efficient use of energy and raw materials and for the use of renewable energies that have a pilot 
character beyond individual companies. 
 5. Duration of subsidy and other time-limits attached to it
 
 
The duration is two to three years for projects subsidised in 2003. 
  G/SCM/N/123/EEC/Add.9 
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 6. Statistical data permitting an assessmen t of the trade effects of a subsidy  
 
The above-mentioned subsidy pr ogramme is based on the European Community’s Research 
and Development (R&D) framework. The assisted projects comprise only 
development stages before competition. 
 
VII. REGIONAL AID PROGRAMME (LAND RHEINLAND-PFALZ) 
1. Name of the subsidy scheme or ad hoc subsidy  
 
Regional aid programme of the Land Rheinland-Pfalz. 
 2. Form of the subsidy
 
 
Investment grant 
 
3. Subsidy per unit  
 
Up to 7.5 per cent for medium-sized industries, 15 per cent for small-sized industries. Total budget:  DM 17 million, disbursement in 2002:   € 2,8 Mio. Euro.   disbursement in 2003:  € 1,9 Mio. Euro. 
 disbursement in 2004: € 1,0 Mio. Euro 
 4. Objective and/or purpose of the subsidy
 
 
Promotion of investment in sma ll- and medium-sized industries. 
 
5. Duration of subsidy and other time-limits attached to it  
 
Unlimited. 
 6. Statistical data permitting an assessmen t of the trade effects of a subsidy 
 
In 2002:  creation of 262 jobs by providing financial assistance to 53 individual 
promotional cases; 
In 2003:  creation of 39 jobs by provid ing financial assistance to 17 individual 
promotional cases; 
In 2004:  creation of 40 jobs by provid ing financial assistance to 19 individual 
promotional cases. 
 
VIII.  NATIONAL PROGRAMME FOR CIVIL AERONAUTICAL RESEARCH 
1. Name of the subsidy scheme or ad hoc subsidy
 
 
 National programme for civil aeronautical rese arch and technology for the period 2003 to 
2007.  Federal Government and ai d for research and technology. 
 2. Form of subsidy
 
 
Non repayable grants (industry: 40 %; univer sities: 100% of the expenses) are awarded 
towards R&T expenditure  G/SCM/N/123/EEC/Add.9 
Page 10 
 
 
 3. Amount of grant per unit  
 
2003: 27.77 Mio. Euro 2004: 35.82 Mio:Euro 
 
4. Purpose of aid
 
 
This programme intends to contribute to st rengthening innovative medium and long term 
research and technology, one of the most important  key technologies with spin-off effects to other 
sectors.  The programme aim forms part of the Fede ral Governments' research and technology policy. 
 . The priorities of the programme are encour aging sustainable research in the fields: 
 
Low pollutant and safe Aircraft of the next generation Low noise all-weather helicopter 
Efficient and ecologically friendly engine 
 6. Duration of aid
 
 
2003 - 2007 
 
7. Statistical data permitting an assessmen t of the trade effects of the subsidy  
 
n.a. 
 IX. PULP MILL STENDAL (SACHSEN-ANHALT) 
1. Name of the subsidy scheme or ad hoc subsidy
 
 
Zellstoffwerk (Pulp Mill) Stendal based on following aid schemes: A: Improvement of the regional econom ic structure (Gemeinschaftsaufgabe) 
B: Investitionszulagengesetz 1999 
C: Scheme for direct guarantees of the Fed.Rep.of Germany and the Federal Länder 
 2. Form of the subsidy
 
 
A: Grant 
B: Grant 
C: Guarantee 
 3. Subsidy per unit
 
 
A: 109,161 Mio. Euros 
B: 165,515 Mio. Euros 
C: 80 % guarantee for a loan of 464,55 Mio. Euros 
 4. Objective and/or purpose of the subsidy
 
 
The primary regional policy objective is to enable structurally weak regions to keep pace with 
general economic development by  offsetting disadvantages of location and reducing regional 
development differentials. 
 It focuses on supporting regional de velopment activities with a view  to raising the Levels of 
employment and income in problem areas.  G/SCM/N/123/EEC/Add.9 
 Page 11 
 
 
  
5. Duration of subsidy and other time-limits attached to it  
 
2 April 2002 - 31 December 2004 
 
6. Statistical data permitting an assessmen t of the trade effects of a subsidy  
 Not available 
 X. CORRUGATED BASE PAPER PLANT (BRANDENBURG) 
1. Name of the subsidy scheme or ad hoc subsidy
 
 
Grant investment aid under the multisectoral frame work on regional aid for large Investment 
projects to the Hamburger AG for the construction of a new plant to produce white and brown corrugated base paper 
 
2. Form of the subsidy
 
 
Grant 
 
3. Subsidy per unit  
 
Germany notified is intention to grant aid under the multisectoral framework on regional aid 
for large investment projects by the European  Commission. On 9 April 2002, the European 
Commission decided that the Government of Bra ndenburg is allowed to provide assistance amounting 
to EUR 40.254.350 
 To the project of the Hamburger AG. The notification process is finished 
 4. Objective and/or purpose of the subsidy
 
 
Purpose: partly financing a project of Hambur ger AG aiming at constructing a new plant for 
the production of corrugated base paper Objective: improving the regional economic structure in structurally weak areas 
Under Art 87 EC Treaty, creation of 299 permanent and 267 indirect jobs  
5. Duration of subsidy and other time-limits attached to it
 
 
Unlimited 
 6. Statistical data permitting an assessmen t of the trade effects of a subsidy
 
 
Not available 
 
XI. FAIRCHILD DORNIER (FOR INFORMATION REASONS ONLY) 
The notification for 2002/2003 contained a statement about financial aid for "Fairchild 
Donier." The program was terminated in 2002. 
 
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