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COM (83) 676 
 
 
 
Vol. 1983/02 46 
  
 
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Conformém ent au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983 
concernant l'ouverture au public des archives historiques de la Communauté économique 
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983, 
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003 
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents 
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit 
règlem ent. 
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983 
concerning the openi ng to the public of the historical archives of the European Econom ic 
Community and the European Atomic Energy Communit y (OJ L 43, 15.2.1983, p. 1), as 
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243, 
27.9.2003, p. 1), this f ile is open to the public. Where necessary, classified documents in this 
file have been declassified in conformity with Article 5 of the aforementioned regulation.  
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom  1. 
Februar 198 3 über die Freigabe der historischen Archive der Europäischen  
Wirtschaftsgemeinschaft und der Europäischen Atomgem einschaft (ABI. L 43 vom  15.2.1983,  
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. Septem ber 2003  
(ABI. L 243 vom 27 .9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit  
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der genannten Verordnung freigegeben.  
COMMISSION OF THE EUROPEAN COMMUNITIES
COM(83) 676 final
Brussels, 21 November 1983
Report of the Commission to the Council
AID GRANTED TO SHIPBUILDING IN THE EEC
COM(83) 676 final

Report of the Commission t >  the Council
1. In approving Directive 81/363/EEC on State aid to shipbuilding, 
the Council asked the Commission to lay before it regular reports 
on the aids given to tnis sector (Articles 3, 6, 7 and 8 of the 
Directive).
2. ïhe report for the G«oond half of L982 i s attached as Annex I.
3. Also attached (Annex II) is a schsdule of current aid schemes in 
favour of shipbuilding.

FOREWORD
The data in this report highlight four faots:
- the continuation of the slump in the shipbuilding industry and its corollary of  
a large amount of underutilized capacity;
v - the paucity of investment in the industry, attested by the fact that relatively  
little aid is being given for investment intended to rationalize and modernize  
yards;
- the scale of direct production aid in four Member States (averaging between 15  
and 23$ at a tonnage-weighted rate) and of aid to shipowners, practically always  
linked to orders placed with national yards (Community average around 10$ of the  
ship*s price);
- the difficulty of obtaining an overall picture of the scale and impact of aid  
because of the lack of certain data on financing, payments to public-sector yards  
to cover Iosssb,  eto.
The discussion of this report with the national experts in accordance with Article  
10 of the Fifth Directive should start from the following questions which are  
prompted by these data. First, in view of the scale of the aid being granted by  
the governments in various forms, has the progress of the Community shipbuilding  
industry towards real international competitiveness been significant over the period  
covered by this report and have the restructuring measures been sufficient to  
achieve their objective?
Further, why is the Community shipbuilding market still fairly strictly compartmen­
talized into national segments, and what, if any, is the connection between this  
situation and the aid granted?
Finally, without wishing to attach overriding importance to one particular factor  
among the many contributing to the industry*s situation, should not also the macro-  
economic necessity of controlling and obtaining value-for-money from public expendi­
ture lead to a detailed reappraisal of the aid policy towards shipbuilding in the  
Community and of the cost of that aid?

1. Aid to investment :  Article 3 of the 5th Directive on aid to shipbuilding.
Period: July-December 1982
Member State Amount of  
investmentNature of aid Effect on pro­
duction oapaoitjI  Type of aid  
r  schôme applied
PR Germany (1) 1)BM 45.25 Mio Loan of DM 21.0  
MioNo effect on
capacity
Modernization
of equipment in
shipbuilding
sectorGeneral aid  
scheme invest­
ment credits  
1981/82
2)DM 13.75 » 0Grant (Max.  
8.75$ of invest­
ment )No effect on
capacity  
Modernization  
of equipmentRegional aid  
scheme for im­
provement of  
structures
3)DM 44.50 Mio Grant (Max.  
8.75$ of invest­
ment)Diversification  
out of ship­
buildingRegional aid  
scheme for im­
provement of  
structures
Belgium
Denmark - -
Prance - -
Greece - -
Ireland - -
Italy l)Lit 8065 Mio 10$ of invest­
mentReduction of  
capaoity in  
shiprepair  
sectorLaw No 94 of  
March 1980
2)Lit 9595 'too 10$ 0 · *  invest­
mentMerger of two  
shipyards  
No effect on  
capacity ship­
building sector  
Reduction of  
capacity in  
shiprepair  
sectorLaw No 94 of  
March I 98O
Netherlands HFL 5.23 Mio Grant of 2( $ 
of irrestmtnt  
(estimated net  
effect: 13$)No effect on  
capacity in  
shipbuilding  
sector. Effi-,  
ciency measure£Aid scheme for
shipbuilding  
Regional in­
vestment schem<  
(IPR)
United Kingdom - -
(l) Correction: period Jaroary-June 1 >82: Investment amount for project 2:
DM 45.25 Kio.

2. Production aid? Articles 6 and 7 of the 5th Directive on aid to shipbuilding·
Period: July-December 1982
Member State Nr. of aided  
casesgrt Nr. of non-aided  
casesgrt Estimated pro­
portion of con­
tract priceEstimated average  
weighted by tonne
PR Germany — — _ —
Belgium - - - -
Denmark - - - -
France 10O r -  * 1 800 5# to 30# (1-2) 22*9#
(cgrt) (ogrt)
Greece - - - -
Ireland - - - ■  -
Italy 30OC4 Qon- - 15*2# to 25# 21 .7#
Netherlands 16 47,755- - 3.1% to 17*5$ 14*3#
United Kingdom 4 (3) 39,912— « 14.98# to 17.98? 16.8#
(4)
(1) The ifl-r-irate applied was 16#; the level of 30# was exceptionally used for the order for a contai nership of 35*400 cgrt
(2) Plus price guarantee.   
(3) Excl. an order for 4 ships (tonnage 20.000 grt; estimated aid level of 15 to 18#), for which final négociations are in
progress .
(4) Plus shipbuilders* Relief, 2$.

3. Aid to shipowners :  Article 8 of the 5th Dirtctive on aids to shipbuilding  
a) Volume of contracts
A :  Contracts aided. B :  Contracts refused. C :  Total volume of contracts.  
Period :  July - December 1982- 3 - ANNEX I
Total volumeFor building in  national yardsFor building in  Dther EEC countriesFor building in  third country yards
G K Tnationalcurrency
(millions)GRTnationalcurrency
(millions)GRTnationalcurrency
(millions'GRTnational"urrency
millions)
R.F. Germany- A331 949 2033.1 331 949 2033.1 .._
B 274 808645.5 262 209 592.2 12 599 53.3
C 606 757 2678.6 594 1582625.3 12 599 53.3
Belgium A 67 1017164 67 1017164 Ì
B 300 300
C 67 1017464 67 101 7 /6 4
Denmark A14 300 600 14 300(  00
B- -
C14 300 600 14 3001
>00 
France A74 541 627.9 55 391 193.2 19 150 -134x7___
B
C74 541 627.9 55 391 193.2 19 150134.7
Greece A- --
B— —-
C— —-
Ireland A—
B_ — -
C- --
  3 4QQ- Italy A196 500 206 000 189 000201 001: 3 000 1  600 4 500
B__ — - 
. . .
C 196 500 206 000 189 000201 00C 3 000 1  600 4 5003 400
Netherlands A37 767 367.6 37 767J67^6
16.9 B3 111 16.9 3 111
C 40 878 384.5 40 878 384.5
United 2 KingdomA86 001 117.886 001117.8
B- -- -
C86 001 117  86 001 JLLL·?
All decisions on shipowners' aids a e taken in tl a secoi 1 half of the year<>
The British scheme applies only to British owner, who pi ace orders in a national shipyard  
- OECD conditions.2

b) Average effect of aid per contract (Pull year 1982 - Yearly comuni oat ion)
Member
StateTotal
AverageFor building  
in nat. yardsFor building  
in other EEC  
countriesFor building in third  
oeuntry yards
PR Germany 15.8% 15-8% ·.
Belgium (1)
Denmark 12.655 12.655
France 12.9# 12.43% 14.99% 14%
Greece - -
Ireland ( 2)
Italy (3)
Netherlands 5 x 2.$5 x 2.3% 5 x 2.3% 5 x 2.3%
UI 8 - 15-292 8 - 15.255
(1) Information not supplied·
(2) No speoial scheme for shipowners·
(3) The information provided by the Italian authorities is based on different 
criteria than those used by the other Member States and is not comparable.

AMEX II
LIST OP AIDS ADD INTERVENTIONS POR SHIPBUILDING
a) Aids to shipbuildingMay 1983
Description Level of intervention Remarks
PR Germany 1) Hamburg - allocation of DM 35 m for 
investment in the port of  
Hamburg and conversion of  
the shipbuilding sector to  
ahiprepair and other  
Beotors (1978 - 1983)DM 31 a for investment on  
publicly-«wned land·DM 4 a  
for investments on private  
land
2) Lower-  
Saxony- subsidies up to DM 3 * Por diversification measures  
(out of shipbuilding)
Prance - direct aid for construction 23$ of contraot price (incl. cost  
escalation)
Forecast for 1983/8 4:  20$ (exol. cost  
escalation)The aid scheme fbr the period  
1983/84 has been notified on  
4.7.1983
Ireland " * ·  direct ax« * c* con·- — «.^oxi* · .  ·  ^
v- wwiivx awu xc>t Max. intervention level  
authorized for 1981. Aid to  
shipbuilding for the years 1$8i  
and 1983 ha^ ne+ been planned
Italy - direct aid for construction  
(budget allocation:
Lit 560 ltd :; 8i 1983)25$ of contract price ( 30$ for the  
Mezzogiorno region)The Commission has authorized  
this scheme in 1983 under  
restrictive conditions
Netherlands - direct aid for construction 10.5$ of contract price  
20$ for exceptional casesMax. intervention level 
authorized for 1982 (budget  
allocation 157 Mio HFL)  
Prolongation of this scheme for  
1983-1984 has been notified to  
the Commission
United Kingdom - single refund of certain  
taxes (shipbuilders· relief2$ of the construction cost
- direct aid for construction  
5th tranche of Intervention  
Fund of UKL 50 Mio (July  
1982-July 1983Max. 17$ of contraci price (incl.  
shipbuilders’ relief)
Northern Ireland: 18$ of contraot  
price (excl. shipbuilders’ relief)July 1982-July 1983

ANNEX II
- 2 -
b) Credit facilities for sales
Description of aid Qualifying transactionsLevel of 
interventionRemarks
Germany - interest rebate All sales - maximum interest re­
bate 2% (limit OECD 
conditions)  (1)special schemeforships
Belgium - interest rebate Sales to other . ’tomber 
States and third coun­
tries- OECD conditions special scheme
Denmark - preferential credit All sales - OECD conditions special schemeforships
France - preferential credit Sales to other Member 
States and third coun­
tries- OECD conditions general scheme
Ireland - ^ rerentiax credit All sales - OECD conditions special schemeforships
'’"J- -1 - r . L . - preferential credit All sales - OECD conditions special schemeforships
Netherlands - interest rebate All - maximum interest re­
bate 2%
limit OECD conditionsspecial schemeforships
United Kingdom - preferential credit Export sales - OECD conditions general scheme
(1) Repayment period 8 1/2 years, interest rate 8 %, down payment 20 %.

c) Credit facilities for purchase involving add to shipbuildingANNEX II
FR Germany
Belgium
Denmark
France
United Kingdom
NetherlandsDescription of aid Level of intervention
Financing facilities for investment!  
by German owners on purchase of  
ships in a Community yard or in  
third countries
Credit facilities for Belgian owner«  
on purchase of ships in a Community  
yard or in third countries
Credit facilities for Danish owners  
on purchase of shipB in a Community  
yard
Financing facilities for investment«  
by French owners on purchase of  
oh‘ ,pr in Community yard or in  
third countries
Credit facilities for the purchase  
of ships by British owners in  
British yards (Home Credit Scheme)
Financing facilities for investment«  
by Dutch owners on purchase of shipE 
in a Community yard or in third  
countriesRemarks
Grant of 12.5$ of contract price  
(special grants: max. 5$ of contract
price)
Credit at 4 or 5$ fer 15 years (with  
one year moratorium on repayment) on  
80$ of oontraot price (Law of 23.4·  
1948)
Credit at 8$ for 12 years (with 2  
years moratorium on repayment) on  
80$ of contract price
Grant of max. 7»5$ of contract price
- OECD conditions of 18.7.1979«
- in addition, a subvention scheme  
has been introduced under Section  
25 of the Industry Act 1975
- grant, of 12$ of contract price
- investment premium of 2.3$ during  
5 yearsThe total amount of the aid must  
not exoeed FF 30 mio
The application of "this scheme  
must not result in conditions more  
favourable than those contained in  
the CECD Understanding

d) Price guarantee mechanism
Description of aid Level of intervention Re marie, s
France - Government takes responsibility for  
increase in cost between ordering  
and delivery
- A grant of per year is paid  
when the threshold is not exceededIntervention relates to  
80^ of the cost for an  
increase in exoess of 6.5$ 
and since July 1982 amounts  
to a max. 1^
ItalyThe Coamissien has not
authorized thè applicati on  
of thè priee guarantee  
foreseen by Law 598 for thè  
period 1981 te 1983

2
2. Produktiesteun. Artikelen 6 en 7 van de vijfde richtlijn betreffende steun aan de scheepsbouw.
Periode : juli - december 1982.
Lid-StaatAantal
gesteunde
contractenBRTAantal niet
gesteunde
contractenBRTGeschat aandeel  
van de con­
tractprijsGemiddeld aandeel  
van de contract­
prijs (wegings­factor tonnage)
Bondsrepubliek
Duitsland - -
België - - - -
Denemarken - - - -
Frankrijk 10 63.850
(cbrt)1 800
(cbrt)5 X è 30 X  
(1 ~ 2)22,9 X
Griekenland - - ■  - -
Ierland - - - -
Italië 30 251.820 - - 15,2 X è 25 X 21,7 X
Nederland 16 47.755 - - 3,1 X a 17,5 X 14,3 X
Verenigd 
Koninkri jk 4 (3) 39.912 - - 14,98 X è 17,98  
X 
(4)16,8 X
(1) Max. toegekend aandeel van de contractprijs :  16 X; 30 X werd bij uitzondering toegepast voor de bouw van eencontainership <35.400 cbrt).
(2) Bovendien toepassing van het prijsgarantiemechanisme.
<3) Excl. een opdracht van 4 schepen (tonnage 20 .000 brt - geschat steunniveau 15 è 18 X), waarvoor de onderhandel!noen  
nog niet afgesloten waren. y
(4) Boven toepassing van ShipbuiIder's Relief van 2 X.