WORLD TRADE  
ORGANIZATION  G/SCM/N/38/EEC/Add.12/Rev.11 
8 January 1999 
 (99-0022) 
Committee on Subsidies 
and Countervailing Measures Original:   English/ 
 French 
  
 
SUBSIDIES 
 
New and Full Notifications Pursuant to Article XVI:1
 
of the GATT 1994 and Article 25 of the Agreement  
on Subsidies and Countervailing Measures  
 
EUROPEAN COMMUNITIES 
 
Revision  
 
 
 The following addendum to the notification of the European Community relates to subsidy programmes of Portugal
. 
                                                      
1 English only.  G/SCM/N/38/EEC/Add.12/Rev.1 
Page 2  
PORTUGAL  
 
TABLE OF CONTENTS  
   Page
 
 
Regional Incentives System (SIR) ............................................................................................... ..4 
 Trade Modernization Support Programme (PROCOM)................................................................5  International Development Support Progra mme for Trade and Services (PAIEP 2) ....................6 
 
Strategic Programme for the Revitalization and Modernization of Portuguese 
Industry (PEDIP II)............................................................................................................ ............7 
 RETEX Operational Programme ...................................................................................................8  
 
1. Aid for Shipbuilding and Ship Conversion.......................................................................9 
 2. State Aid to "Siderurgia Nacional" .................................................................................10  3. Energy Programme .........................................................................................................11  
4. Programme for Modernizing Textile  and Clothing Industry (IMIT)..............................13 
 5. Interest Subsidy for Investment in the Construction of Vessels with a Length  up to 9 Metres – PO/12 – 000/001/00.............................................................................15  
6. Interest Subsidy for Investment in the Construction of Vessels with a Length 
 of 9 to 33 Metres – PO/12 – 000/002/00.........................................................................16  7. Interest Subsidy for Investment in the Transformation or Improvement of  Vessels with a Length of Less than  9 Metres – PO/12 – 000/004/00 .............................17 
 
8. Interest Subsidy for Investment in the Transformation or Improvement of 
 Vessels with a Length of 9-33 Metres – PO/12 – 000/005/00 ........................................18  9. Interest Subsidy for the Purchase of Machines and Other Equipment for 
 Fishing Vessels – PO/12 – 000/007/00...........................................................................19 
 
10. Interest Subsidy for the Purchase of Fishing Devices and Tools –  PO/12 – 000/008/00 ........................................................................................................20  11. Interest Subsidy for the Purchase of Second-Hand Vessels –  
 PO/12 – 000/009/00 ........................................................................................................21 
 12. Interest Subsidy for the Construc tion or Purchase of Fishing Vessels – 
 PO/12 – 000/012/00 ........................................................................................................22  13. Interest Subsidy for the Modificati on of Fishing Vessels – PO/12 – 000/013/00...........23 
 
14. Interest Subsidy for the Purchase of Machines, Fishing Devices and Tools 
 Intended for Fishing Vessels – PO/12 – 000/014/00 ......................................................24 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 3 
 
 
  Page  
 15. Interest Subsidy for Investment in the Construction, Purchase, Transformation 
 or Conversion of Fishing V essels – PO/12 – 000/015/00...............................................25 
 
16. New Support Measures for the Fishing Sector ...............................................................26 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 4  
SIR 
 
1. Title 
  
 Regional Incentives System (SIR)  2. Objectives  
 The objective of this regional assistance programme, which covers all the country's less-
developed inland and coastal regions, is to contri bute to the endogenous development of those regions 
by improving their competitiveness and helping to cr eate jobs and thereby reduce migration, while 
promoting diversification of the production of goods and services. 
 
3. Duration 
 
 The duration of the subsidy is 1994-1999.  
4. Legislative authority 
 
 Decree Law No. 193/94, of 19 July  
  Council of Ministers Resolution No. 67/94, of 11 August 
 
5. Year:   1997 
  Government expenditure progr ammed:  Esc 10,233,885 million 
 
 Grants and repayable joint financial participation:   
  - Amounts approved: Esc 17,152,927 million  - Amounts disbursed: Esc 11,679,269 million G/SCM/N/38/EEC/Add.12/Rev.1 
Page 5 
 
PROCOM 
 
1. Title 
  
 Trade Modernization Support Programme (PROCOM)  2. Objectives  
 To promote the sustainable development of the competitiveness of trad e sector enterprises in 
the context of a coherent strategy for the modernization of their activities.  3. Duration  
 The duration of the subsidy is 1994-1999. 
 
4. Legislative authority 
  
 Decree Law No. 184/94 of 1 July 1994   Council of Ministers Resolution No. 33/96 of 3 April 1996  5. Year:   1997 
 
 Government expenditure programmed:  Esc 5,593,701 million   Amounts approved and disbursed: 
(millions of Esc) 
 Approved Disbursed 
Interest rate subsidy   
Non-repayable subsidy 16,513,708 1,521,993 
 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 6  
PAIEP 2 
 1. Title 
  
 International Development Support Prog ramme for Trade and Services (PAIEP 2) 
 2. Objectives  
 To promote the sustainable development of the competitiveness of trade and services 
enterprises in the context of a coherent strategy for the modernization and globalization of their 
activities. 
 
3. Duration 
 
 The duration of the subsidy is 1994-1999. 
 4. Legislative authority 
  
 Decree Law No. 290/94 of 14 November 1994   Council of Ministers Resolution No. 121/94 of 15 December 1994  
5. Year:  1997 
  Government expenditure programmed:  Esc 3,948,921 million   Amounts approved and disbursed: 
 
(millions of Esc) 
 Approved Disbursed 
Subsidy for repayable joint 
financial participation at zero interest rate 6,122,592 1,995,761 
 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 7 
 
PEDIP II 
 1. Title 
  
 Strategic Programme for the Revitaliza tion and Modernization of Portuguese 
Industry (PEDIP II) 
 
2. Objectives 
 
 Regional assistance programme to revitalize th e sustained growth of the competitiveness of 
Portuguese enterprises in order to enhance their cap acity to respond to rapid technological and market 
changes, while at the same time supporting the m odernization, diversifica tion and globalization of 
domestic industry.  
3. Duration 
 
 The duration of the subsidy is 1994-1999. 
 
4. Legislative authority 
  
 Decree Law No. 177/94 of 27 June 1994  
 Council of Ministers Resolution No. 50/94 of 1 July 1994 
 5. Year:   1997 
  Government expenditure progr ammed:  Esc 48,082,036 million 
 
 Amounts approved and disbursed:  
(millions of Esc) 
 Approved Disbursed 
Grants plus reimbursable 
financial co-participation 137,826,672 52,966,735 
 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 8  
RETEX 
 
1. Title 
  
 RETEX Operational Programme  2. Objectives  
 Community Initiative Programme on regional aid with the aim of facilitating the 
modernization of the industrial fabric in regions st rongly dependant on the textiles and clothing sector. 
 3. Duration  
 The duration of the subsidy was 1993-1997. 
 
4. Legislative authority 
  
 Decisions Nos. 264, 265, 266 of 11 September 1993   5. Year:   1997 
  Government expenditure programmed:  
 
(millions of Esc) 
Risk Capital Fund 1,225,365 
Repayable participation 2,241,316 
Non-repayable subsidy 4,623,546 
 
 
(millions of Esc) 
        Amounts approved/disbursed 
 Approved Disbursed 
Risk Capital Fund   
Repayable participation*  633,383  143,528 
Non-repayable subsidy  5,696,606  3,392,916 
 
                                                      
*Repayable financing at zero interest rate for an amount not exceeding 40 per cent of the total financing 
necessary, with a ceiling of Esc 150 million.  The duration is three to six years. G/SCM/N/38/EEC/Add.12/Rev.1 
Page 9 
 
1. Aid for shipbuilding and ship conversion  
1. The notification concerns 1997. 
 2. See information under point 6.  
3. Decree Law No. 296/89 of 4 September estab lishing assistance arrangements for metal-hulled 
shipbuilding and ship conversion (notified and a pproved by the European Commission in accordance 
with the 7
th Directive (90/684/EEC), on aid to shipbuilding. 
 4. Decree Law No. 296/8l9 provides for the grant of non-repayable subsidies. 
 
5. Operational assistance for national shipyards l eading to joint participation in shipbuilding or 
ship conversion costs and compensation for losses.  This aid is subject to a common maximum ceiling established annually by the European Commission, e xpressed as a percentage value of the contract 
before aid which, in 1995, was 9 per cent for building ships of a contract value of more than 
ECU 10 million and 4.5 per cent for ships with a contr act value of less than that amount and for ship 
conversion.  6. The total amount of subsidies allocated in 1997 was Esc 2,187 million.  7. Decree Law No. 296/89 of 4 September entere d into force on 5 September 1989 and is of 
indefinite duration. 
 8. Statistical data not available.  
 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 10  2. State aid to "Siderurgia Nacional"  
 
1. This notification concerns 1997.  2. Aid for financing the plan for the restructuring of the "Sidegurgia Nacional" steel company.  
3. Decision of the European Commission 94/25 7/ECSC of 12 April 1994, in accordance with 
Article 95 of the ECSC Treaty and the Commission Decision of 27 November 1994 in the context of the Community Steel Aid Code.  4. The aid is in the form of capital re inforcement, debt relief and subsidies. 
 
5. Aid granted to the "Siderurgia Nacional" steel company.  6. The total amount of aid authorized amount s to Esc 60,120 million (under Article 95/ECSC) 
amd Esc 5,925 million (under the Steel Aid Code). 
 
 In 1995, the total amount of aid authorized in accordance with Article 95/ECSC was reached. 
  In 1997, Esc 2,250 million were allocat ed under the Community Steel Aid Code. 
 7. The aid has been authorized with a view to enabling the enterprise to become viable by the 
end of 1997. 
 8. Sales trends (long and flat products) and markets.  
 1995 1996 1997 
 KT % KT % KT % 
Portugal 634.3 74.2 834.4 84 903.2 83.9 
EU 
(excluding Portugal) 174.2 20.4 110.6 11 147.3 13.7 
Other 
countries 47.6 5.4 49.6 5 25.4 2.4 
Total 856.1 100 994.6 100 1,075.9 100 
 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 11 
 
3. Energy Programme 
 
1. Title of the subsidy programme 
 Energy Programme 
 
2. Period covered by the notification 
 1997 
 
3. Policy objective and/or purpose of the subsidy 
 To reduce the oil dependency by promoting the natural gas, fostering the use of renewable 
energy resources and promoting energy efficiency in all sectors of the economy activity. 
 
 These energy objectives will have major impa cts in the improvement of the Portuguese 
economic competitiveness and will reduce energy environment impacts. 
4. Background and authority for the subsidy 
 Legal basis:  Community Decision No. C (94) 376 and Government Law DL No. 196/94. 
 
5. Form of the subsidy 
 Grants and zero interest rate loans. 
 
6. To whom and how the subsidy is provided 
 Subsidies can be granted to enterprises and m unicipalities according to the specific legislation 
applied to each measure.  Subsidies are granted by  the Ministry of Economy after the application has 
been submitted to the approval of an Energy Commit tee.  Subsidies are paid according to the progress 
of the project.  
7. The total amount or the annual amount budgeted for the subsidy (indicating if possible, 
the average subsidy per unit in the previous year) 
 The total amount of the commitments by Energy Programme in 1997 was: 
 
         
UNIT: 10 ECU  
Measures FEDER  Total 
Measure 1 - Natural Gas 40,460 1,210 41,670 
Measure 2 - Renewables 12,851 0 12,851 
Measure 3 - Energy Efficiency 7,887 2,629 10,516 
                    Total 61,198 3,839 65,037 
 
8. Duration of the subsidy and/or any other limits attached to it 
 Measure 1 - Grants: no time limits; 
 
 Measure 2 - Zero interest rate loans: 3 years granted period and 9 years reimbursement 
period; 
  Measure 3 - Grants: No time limits; 
 
  -  Zero interest rate loans: 2 years granted period and 5 years reimbursement period. G/SCM/N/38/EEC/Add.12/Rev.1 
Page 12  9. The trade effects of the subsidy 
 No effects on international trade. G/SCM/N/38/EEC/Add.12/Rev.1 
Page 13 
 
IMIT 
  
1. Title of subsidy programme 
 “IMIT – Programme for Moderniz ing Textile and Clothing Industry 
 2. Period covered by the notification 
 The year 1997 
 
3. Policy objective and purpose of the subsidy 
 To improve the competitiveness and to mode rnize the Portuguese textile and clothing 
manufacturing sectors. 
 
4. Background and authority for the subsidy 
 Legal basis: 
 
 - Resolution of Council of Ministers No. 96-A/95 (DR 231/95-I B Series, 2ºSuppl., 
6 October 1995); 
  - Decisions No. 61-A/B/C/D/E/F/G/H/95 (DR 240/95-I B Series 3ºSuppl., 
17 October 1995). 
 5. Form of the subsidy 
 Cash grants and/or reimbursable loans at zero interest rate. 
 
6. To whom and how the subsidy is provided 
 Recipients: 
 
 - Industrial companies of the textile and clothing sectors (Ref. 17, 181 and 182 of the 
Portuguese Economic Activities Classification /C.A.E.); 
  - Associations of Enterprene urs, Chambers of Commerce; 
 
 - Non-lucrative organizations (official or  private) providing services in “fashion and 
design”). 
  Subsidy allocation: 
 
 Subsidies are granted to industrial enterpri ses and/or applicant organizations on a case-by-
case basis.  Subsidies are granted by Portuguese Ministry of Economy on application and they are paid according to the progress of the approved project.  G/SCM/N/38/EEC/Add.12/Rev.1 
Page 14  7. The total amount or the annual amount budgeted for the subsidy 
 Incentives given out during 1997 (approved projects): 
     -   Cash grants:  PTE   5,022,200,000      -   Reimbursable loans: PTE 16,356,300,000 
 
    -   Total:  PTE 21,378,500,000 
 8. Duration of the subsidy and/or any other time-limits attached to it 
 The initiative was implemented in 1995  and will remain available until 1999. 
 
9. The trade effects of the subsidy 
 No specific economic studies have been carried out.  Data for this item not available. 
 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 15 
 
INTEREST SUBSIDY FOR INVESTMENT IN THE CONSTRUCTION OF 
VESSELS WITH A LENGTH UP TO 9 METRES – PO/12 – 000/001/00 
 
 
1. Member State 
 Portugal (continental) 
 
2. Form of subsidy 
 Interest subsidy 
 
3. Total amount disbursed in 1997 
 PTE 578 million 
 
4. Policy objective 
 To promote investment in production units in the fishing sector. 
 5. Duration of subsidy 
 Terminated on 31 December 1997. 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) 
 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 16  
INTEREST SUBSIDY FOR INVESTMENT IN THE CONSTRUCTION OF 
VESSELS WITH A LENGTH OF 9 TO 33 METRES – PO/12 – 000/002/00 
 
 
1. Member State 
 Portugal (continental) 
 
2. Form of subsidy 
 Interest subsidy 
 
3. Total amount disbursed in 1997 
 PTE 26,669,000 
 
4. Policy objective 
 To promote investment in production units in the fishing sector. 
 5. Duration of subsidy 
 Terminated on 31 December 1997. 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) 
 G/SCM/N/38/EEC/Add.12/Rev.1 
Page 17 
 
INTEREST SUBSIDY FOR INVESTMENT IN THE TRANSFORMATION OR 
IMPROVEMENT OF VESSELS WITH A LENGTH OF LESS 
THAN 9 METRES - PO/12 - 000/004/00 
 
 
1. Member State 
 Portugal (continental) 
 
2. Form of subsidy 
 Interest subsidy 
 3. Total amount disbursed in 1997 
 PTE 147 million 
 
4. Policy objective 
 To promote investment in production units in the fishing sector. 
 
5. Duration of subsidy 
 Terminated on 31 December 1997. 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 18  
INTEREST SUBSIDY FOR INVESTMENT IN THE TRANSFORMATION OR 
IMPROVEMENT OF VESSELS WITH A LENGTH 
OF 9-33  METRES - PO/12 - 000/005/00 
  
1. Member State 
 Portugal (continental) 
 
2. Form of subsidy 
 Interest subsidy 
 3. Total amount disbursed in 1997 
 PTE 2,940,000 
 
4. Policy objective 
 To promote investment in production units in the fishing sector. 
 
5. Duration of subsidy 
 Terminated on 31 December 1997. 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 19 
 
INTEREST SUBSIDY FOR  THE PURCHASE OF MACHINES AND OTHER 
EQUIPMENT FOR FISHING VESSELS - PO/12 - 000/007/00 
 
 
1. Member State 
 Portugal (continental) 
 
2. Form of subsidy 
 Interest subsidy 
 
3. Total amount disbursed in 1997 
 PTE 155 million 
 
4. Policy objective 
 To promote the development of the fishing sector. 
 5. Duration of subsidy 
 Terminated on 31 December 1997. 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 20  
INTEREST SUBSIDY FOR THE PURCHASE OF FISHING 
DEVICES AND TOOLS - PO/12 - 000/008/00 
  
1. Member State 
 Portugal (continental) 
 
2. Form of subsidy 
 Interest subsidy 
 
3. Total amount disbursed in 1997 
 PTE 177 million 
 
4. Policy objective 
 Applies to cases in which the specifications of  the devices were reoriented or modified. 
 
 Note
:  Does not cover the regular replacement of fishing devices or tools.  For the same vessel 
and the same type of device, only one project can  be subsidized in each three-year period. 
 
5. Duration of subsidy 
 Terminated on 31 December 1997. 
 6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 21 
 
INTEREST SUBSIDY FOR THE PURCHASE OF 
SECOND-HAND VESSELS - PO/12 - 000/009/00 
 
 
1. Member State 
 Portugal (continental) 
 
2. Form of subsidy 
 Interest subsidy 
 
3. Total amount disbursed in 1997 
 PTE 21,465,000 
 
4. Policy objective 
 To prevent vessels in good condition from being le ft idle.  The projects covered by this credit 
line must satisfy one or other of conditions (a ) and (b) and must also satisfy condition (c): 
 
 (a) The purchase is accompanied by mode rnization or conversion of the vessel 
amounting to at least 15 per cent of the vessel's value and intended for: 
   - catching less heavily fished species;   - improving fishing operations; 
  - improving the preservation of the catch; 
  - saving energy.   (b) The vessel is the first purchase of a b uyer more than 40 years old having the skills 
necessary to command the vessel and at l east three years professional experience. 
 
 (c) Only one transaction can be subsidized in each seven-year period.  
5. Duration of subsidy 
 Terminated on 31 December 1997. 
 6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 22  
INTEREST SUBSIDY FOR THE CONSTRUCTION OR PURCHASE 
OF FISHING VESSELS - PO/12 - 000/012/00 
 
 
1. Member State 
 Portugal (Autonomous Region of the Azores) 
 
2. Form of subsidy 
 Interest subsidy 
 
3. Total amount disbursed in 1997 
 PTE 5,495,000 
 
4. Policy objective 
 To provide the region with more modern, be tter equipped and safer vessels with improved 
working conditions. 
 
5. Duration of subsidy 
 Indefinite 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 23 
 
INTEREST SUBSIDY FOR THE MODIFICATION OF 
FISHING VESSELS - PO/12 - 000/013/00 
 
 
1. Member State 
 Portugal (Autonomous Region of the Azores) 
 
2. Form of subsidy 
 Interest subsidy 
 
3. Total amount disbursed in 1997 
 PTE 3,198,000 
 
4. Policy objective 
 To provide the region with more modern, be tter equipped and safer vessels with improved 
working conditions. 
 
5. Duration of subsidy 
 Indefinite 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 24  
INTEREST SUBSIDY FOR THE PURCHASE OF MACHINES, 
FISHING DEVICES AND TOOLS INTENDED FOR 
FISHING VESSELS - PO/12 - 000/014/00 
 
 
1. Member State 
 Portugal (Autonomous Region of the Azores) 
 
2. Form of subsidy 
 Interest subsidy 
 3. Total amount disbursed in 1997 
 PTE 1,429,000 
 
4. Policy objective 
 To provide the region with more modern, be tter equipped and safer vessels with improved 
working conditions. 
 
5. Duration of subsidy 
 Indefinite 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 25 
 
INTEREST SUBSIDY FOR INVESTMENT IN THE CONSTRUCTION, 
PURCHASE, TRANSFORMATION OR CONVERSION OF 
FISHING VESSELS - PO/12 - 000/015/00 
 
 
1. Member State 
 Portugal (Autonomous Region of Madeira) 
 
2. Form of subsidy 
 Interest subsidy 
 3. Total amount disbursed in 1997 
 PTE 41,375,000 
 
4. Policy objective 
 To promote investment in production units in the fishing sector. 
 
5. Duration of subsidy 
 Indefinite 
 
6. Statistical data 
 (The subsidy does not have a direct effect on trade.) G/SCM/N/38/EEC/Add.12/Rev.1 
Page 26  
NEW SUPPORT MEASURES FOR THE FISHING SECTOR 
 
 
1. Member State 
 Portugal 
 2. Form of subsidy 
 Subsidization up to a maximum of 60 or 65 pe r cent of eligible investments in accordance 
with Council Regulation (EC) No. 3699/93 of 21 December 1993.  
3. Total amount disbursed in 1997 
 Million PTE 
Adjustment of fishing efforts  523,032 
Renovation and modernization of the fishing fleet  410,099 
Processing and marketing of fishery products  202,602 
Promotion of fishing products  13,775 
Fishing port equipment  143,372 
Vocational training  72,276 
 
4. Policy objective 
 To promote investment in production units in the fishing sector. 
 
5. Duration of subsidy 
 Until 31 December 1999 
 6. Statistical data 
 (The subsidy does not have a direct effect on trade.) 
  
__________