RESTRICTED
WORLD TRADE G/SCM/Q2/EEC/9
16September 1996
ORGANIZATION(96-3582)
Original: English Committee onSubsidies andCountervailing Measures
SUBSIDIES
Questions from theUNITED STATES Regarding theNew
andFullNotification oftheEUROPEAN COMMUNITY1
Thefollowingcommunication,received9September1996,hasbeenreceivedfromthePermanent
Mission oftheUnited States.
_______________
Community-wide Programmes
1. Regarding U.S.Question 5.D
Initsoralresponse, theECindicated thatthemeasures referred toherewere incorporated
initsnotification ofstructural fundinitiatives. Could theECidentify andclarify which oftheindividual
initiatives authorized byArticle 11ofCouncil Regulation 4253/88 areincluded under itsnotification
ofstructural fundmeasures, andwhere theidentifying information orreference maybefound inthe
notification itself?
2. Regarding U.S.Question 5.Y
Could theECclarify whether tradeassociations are(potential) beneficiaries ofassistance under
thisprogramme? Areindustrial clean-up operations everfunded through suchassistance and,ifso,
would itbeforclean-up operations which commercial enterprises would otherwise beobligated tofund?
Initsoralresponse, theECindicated thatitwould further investigate andprovide additional information.
AllMember States
3. Regarding U.S.Question 1
Withrespect toeachoftheMember Statenotifications, theECindicated thatitwould respond
inwriting tothegeneric U.S.question about whether allMember State-contributed assistance under
theCommunity structural fundmeasures wasreported.
4. Regarding assistance toagriculture
Infollow-up toareply provided bytheECtoKorea, theECindicated inresponse toa
subsequentquestionbytheUnitedStatesthatallmeasureswhichwerenon-specificwithintheagricultural
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sector were considered byitnottobespecific within themeaning ofArticle 2oftheAgreement.
Could theECconfirm inwriting thatthisisitsposition? Ifso,could itprovide additional views or
information astotheexistence ofother subsidies specific to"certain enterprises" within theagricultural
sector ofanyrelevant granting authority within theCommunity ’sterritory thatwould, therefore, fall
within thenotification requirements oftheAgreement?
Belgium
5. Regarding U.S.Questions 3.A.and3.B.
Inbothinstances, theUnited States inquired whether assistance under these measures relieved
firmsoflegal/statutoryobligationsforwhichtheyotherwisewouldbeliable--orassistedtheminmeeting
suchobligations --which webelieved tobethecase. Iftrue,itwould betheU.S. viewthatsuch
assistance metthenotification requirement ofArticle 25oftheAgreement. Could theECplease clarify
andcomment?
France
6. Regarding U.S.Question 2
TheECindicatedinitsoralresponsethatitwouldsupplyfurtherinformationinwritingregarding
assistance toAirbus Industrie anditsconsortium members inrelation tothenotification requirements
ofArticle 25oftheAgreement andArticle XVIofGATT 1994. Inparticular, itwasourimpression
thattheECindicated initsoralresponse that,initsview, royalty-based financing ofthedevelopment
ofcommercial products could noteverbeconsidered asubsidy within themeaning oftheAgreement.
Isourunderstanding correct and/or could theECplease elaborate infurther detail thebasis forits
views inthisregard? (Note: Thisquestion would apply toallinstances inwhich theU.S. inquired
about assistance toAirbus andtheECindicated thatitwould supply further information andviews
inwriting.)
Germany
7. Regarding U.S.Question 3.A
Initsoralreply, theECreferred tothe"special circumstances" associated withtheoperations
oftheTreuhandanstalt asareason, inpart,fornotnotifying loanguarantees orother forms ofassistance
provided bythisentity. Without contesting suchspecial circumstances, theUnited States requests that
theECfurtherelaborateitsviewsonhowthisexcludessuchassistancefromthenotificationrequirements
oftheWTO or,otherwise, thatitprovide therelevant notification information.
Italy
8. Regarding U.S.Question 12
Could theECclarify further itsview thattheprogrammes identified inA,B,C,D,Hand
JoftheU.S. question arenotregionally specific? Ifenterprises located inaparticular region are
explicitly permitted toreceive more generous subsidy benefits under anational programme byvirtue
oftheirbeing located inthatregion ,notwithstanding thattheprogramme mayprovide some levelof
benefits toenterprises throughout thenation, isittheEC’sviewthatsuchregionally-targeted subsidy
benefits donotconstitute aregional subsidy?G/SCM/Q2/EEC/9
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9. Regarding U.S.Question 12.N
IntheCommitteediscussion,theECindicatedthatitdidnotknowwhat"Riconversider"referred
to,andcould nottherefore reply totheU.S. questions without additional information. Based on
information available tous,weunderstand thatRiconversider isanentity which wasestablished in
1984toorganizeretrainingprogrammesforsteelworkers,attherequestofboth/eithertheECSCthrough
Article 56(2)(b) and/or companies. Although wearenotaware ofRiconversider supplying funds to
companies forretraining purposes, neither dowehaveanyinformation bywhich tojudge whether
anyfeeswhich Riconversider might charge foritsretraining programmes confer abenefit. While
theUnited States isnotnecessarily oftheviewthattheactivities ofRiconversider constitute anotifiable
subsidy within themeaning oftheAgreement, wewould appreciate learning theEC’sviews inthis
regard.
10. Regarding U.S.Question 12.Y
Initsoralreply, theECindicated thatitdidnotconsider benefits under thisprogramme to
becontingent uponexport performance because theprogramme dealtwithpotential exports, notactual
exports. TheUnited States asked whether itwaspossible toreceive assistance under theprogramme
ifanenterprise didnotexport. Could theECelaborate itsview andexplanation infurther detail,
andcomment onthemanner inwhich theprogramme isjudged tobecompatible withtheAgreement ’s
standard fordefacto export subsidies?
11. Regarding U.S.Question 12.DD
Initsoralreply, theECindicated thattheU.S.question wastoogenerally phrased topermit
ittoidentify theprogramme inquestion. Inreply, theUnited States indicated that,according toits
information, therelevant background andauthority forthisprogramme isLaw306/66. Could the
ECplease provide additional information about thisprogramme andexplain whyitwasnotconsidered
appropriate toinclude initssubsidy notification?
Portugal
12. Regarding U.S.Question 5
During theCommittee review, theUnited States reiterated itsobservation thatthenotification
inmany instances failed toprovide information onthebackground andauthority ofthesubsidy, as
required bytheAgreement. Could theECsupply theappropriate information inthisregard inrespect
toPortugal ’ssubsidies?
13. Regarding U.S.Question 12
TheUnited States orally requested theECtoprovide further clarification anddescription of
thisprogramme, e.g.,whether and/or howtwotypes ofaidwerebeing offered under theprogramme.
Spain
14. Regarding U.S.Question 11.E
Initsoralreply, theECindicated thatthere wasnoexport performance requirement, perse,
which enterprises havetomeet inorder toreceive benefits under thisprogramme. However, the
United States understands thatunder theterms oftheauthorizing legislation andregulations, thetax
deductions maybeclaimed onlyiftheforeign investment forwhich thedeductions areclaimed isdirectly
related totheinvesting company ’sexport activities. Could theECcomment further onthis?