WORLD TRADE  
ORGANIZATION  G/SCM/Q2/EEC/60 
30 March 2010 
 (10-1727) 
Committee on Subsidies 
and Countervailing Measures Original:   English 
 
 
 
SUBSIDIES  
 
Questions Posed by AUSTRALIA Regarding the New and Full   
Subsidies Notifications of the EUROPEAN UNION1 
 
  The following communication, dated 29 March 2010, is being circulated at the request of the Delegation of Australia.    
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European Union
 
 
Question 
 
Aid to the Coal Industry  
  According to EU notification and Council Regulation (EC) No 1407/2002, the aid may not 
cause prices for EU coal to be lo wer than those for coal from third countries.  Can the EU please 
provide details of the eligibility criteria and gui delines for expenditure under this programme, and 
details of the aid provided under the heading 'other' in  the notification?  How does the EU ensure that 
the aid does not cause EU coal to be lower priced than  third country coal?  What is the effect of the 
aid on the coal and related markets (e.g. coke production and steel)?   
 
Italy
 
 
Question 1 
 
Extraordinary intervention in the South of Italy (Ministry of University and Research)  
 
 This programme is intended to provide aid to entrepreneurial activities in disadvantaged 
areas.  The subsidy is provided through a grant and soft loan.  In 2007, total disbursements under the 
grant were €22,743,720.36 and under the soft loan were €826,849.75.  In 2008, total disbursements 
under the grant were €3,042,964.54 and under the soft loan were €2,161,469.48.  
 Can Italy please provide details of the eligib ility criteria and guidelines for expenditure under 
this programme?   
                                                     
 
1 G/SCM/N/186/EEC, G/SCM/N/186/EEC/Add.13, G/SCM/N/186/EEC/Add.14, 
G/SCM/N/186/EEC/Add.25 and G/SCM/N/186/EEC/Add.27.   G/SCM/Q2/EEC/60 
Page 2  
 
  Question 2 
 
Extraordinary intervention in the South of  Italy (Ministry of Economic Development)
 
  This programme is intended to provide aid to entrepreneurial activities in disadvantaged 
areas.  The subsidy is provided in the form of a grant.  In 2007, €315.12 million was granted.  In 2008, 
€171.95 million was granted.     Can Italy please provide details of the eligib ility criteria and guidelines for expenditure under 
this programme?   
 
Ireland
 
 
Question 1 
 Scheme of grant aid for the development of the organic sector – off farm
 
  This programme is intended to facilitate the deve lopment of the organic sector so as to ensure 
a regular supply of high quality organic produce to the market.  The scheme provides financial assistance in respect of approved investment/development projects, including the sale of organic products as part of a wider organic operation.  The grant aid is payable at 40 per cent of the eligible 
cost.  The maximum subsidy payable for off-farm investment is €500,000.   
  Can Ireland please provide details of the tota l cost of the programme for 2007 and 2008 and 
the major products supported?    Question 2  
 
Un-notified subsidies:  Support to the Pharmaceutical Sector
 
  We note that Ireland has not provided any notifi cation of subsidies paid to the pharmaceutical 
sector.  The IDA Ireland Investment Promotion Agency website provides that "IDA may provide 
financial support to [pharmaceutical] compani es wishing to locate in Ireland ... The unique 
characteristics of any proposed project will de termine the incentive package available ... IDA 
evaluates potential projects through a process of negotia tion ... The type of grants that are available 
include;  Employment Grants, R&D Grants , Training Grants, Capital Grants".  
[http://www.idaireland.com/business-in-ire land/life-sciences-pharmaceuti/why/] 
 
 The Enterprise Europe Network website page on the Pharmaceutical Sector in Ireland also provides that Ireland has recently introduced a new R&D Tax Credit, designed to encourage 
companies to undertake new and/or additional R&D ac tivity in Ireland, which covers wages, related 
overheads, plant/machinery, and buildings.   [http://www.sligochamber.com/admin/browser/arc hive_library/factsheet%20the%20pharmaceutical%
20sector%20in%20Ireland%202.pdf] 
  Can Ireland please provide details of all subsid ies provided to the pharmaceutical sector and 
pharmaceutical companies in 2007 and 2008, incl uding by the IDA Ireland Investment Promotion 
Agency?  Can Ireland please provide details of the eligibility criteria and guidelines for expenditure 
for the programmes that provided these subsidies?  Can Ireland please provide de tails of the eligibility 
criteria and guidelines for the R&D Tax Credit?     G/SCM/Q2/EEC/60 
 Page 3 
 
 
  Spain  
 Question 1 
 
Aid to job creation projects in mining areas
 
 
 This programme is intended to promote re gional development through aid for investment 
projects that help to reduce the dependency on coal mining of the areas concerned.     Can Spain please provide details of the elig ibility criteria and guidelines for expenditure 
under this programme?   
 
Question 2  
 
Aid for coal mining
 
 
 This programme is intended to cover the diffe rence between coal mining costs and coal sales 
revenues.  Non-repayable subsidies are granted to coal-mining companies whose production costs 
exceed their sales revenue.  In 2007 and 2008, €85,302, 800 was granted to State enterprises to cover 
losses.  In 2007, €284,321,420 was granted to private enterprises to cover losses and in 2008, 
€266,500,000 was granted to private enterprises to cover losses.  Costs related to closure (social and 
technical costs) are also subsidised.   
  Can Spain please provide details on the extent to  which coal produced by the recipients of the 
aid provided by this programme is exported?  Can Spain please provide the number of State 
enterprises who received aid to cover losses ( 2007 and 2008 figures), the number of private 
enterprises who received aid to cover losses (2007 and 2008 figures), the number of State enterprises 
who received aid for the social costs of the closure of mining operations and early retirement (2007 and 2008 figures), the number of State enterprises who received aid for the technical costs of the closure of mining operations and early retirem ent (2007 and 2008 figures), the number of private 
enterprises who received aid for the social costs of the closure of mining operations and early retirement (2007 and 2008 figures), and the number of private enterprises who received aid for the 
technical costs of the closure of mining operati ons and early retirement (2007 and 2008 figures)?   
 
Question 3  
 
Shipbuilding subsidies
 
 
 This programme is intended to ensure that  the shipbuilding sector remains competitive, in 
view of the difficult market situation and the need  to encourage yards to make the necessary changes 
to improve competitiveness.  In 2007, €335,500,9 10 was granted, and in 2008, €98,965,160 was 
granted.    
 What would the EU's share of the world shipbu ilding market be if these subsidies were not 
paid?    
Question 4  
 Regional economic incentives scheme
 
  This programme is intended to promote econo mic development in the most disadvantaged 
areas.  In 2007, the programme disbursed €278,624, 672 and in 2008 it disbursed €294,999,177.   
 G/SCM/Q2/EEC/60 
Page 4  
 
   Can Spain please provide details of the elig ibility criteria and guidelines for expenditure 
under this programme?  
United Kingdom
 
 
Question 
 
Selective financial assistance  
  This programme is intended to attract ne w inward investment and encourage existing 
companies to develop their international comp etitiveness.  The programme pledged £19 million in 
2007 and £42 million in 2008 and will be in place until 31 December 2013.     Can the United Kingdom please provide deta ils of the products produced and services 
provided by the recipients of financial assistance under this scheme?   
 
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