  
  
G/SCM/N/401/ISL  
 
18 January 2024  
(24-0410) Page: 1/29 
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  
ICELAND  
The following communication, dated and received on 16 January 2024, is being circulated at the 
request of the delegation of Iceland.  
 
_______________  
 
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  Table of contents  
2021  ................................ ................................ ................................ ................................  4 
1   THE AGRICULTURAL SECTOR  ................................ ................................ .......................  4 
1.1   Agricultural Agreements; Payments to dairy farms, sheep farms and horticulture farms  ....... 4 
2   SUPPORT FOR R&D AND TECHNOLOGICAL INNOVATION  ................................ ............  6 
2.1   Technical Devel opment Fund  ................................ ................................ .........................  6 
2.2   Research Fund  ................................ ................................ ................................ ............  6 
2.3   Support for R&D in marine aquaculture  ................................ ................................ ..........  7 
3   SUPPORT TO SMALL AND MEDIUM -SIZED COMPANIES ................................ ................  8 
3.1   Regional Development Fund  ................................ ................................ ..........................  8 
4   SUPPORT FOR EMPLOYMENT AND TRAINING  ................................ ..............................  9 
4.1   Education and Training Fund  ................................ ................................ .........................  9 
4.2   Employment Opportunities for Women in Rural Areas  ................................ .......................  9 
4.3   Vocational Rehabilitation  ................................ ................................ ............................. 10 
4.4   Employment of Handicapped Persons  ................................ ................................ ............ 10 
5   REGIONAL SUPPORT  ................................ ................................ ................................ . 11 
5.1   Assistance to Employment Development Projects  ................................ ........................... 11 
5.2   Assistance to Local Economic Development  ................................ ................................ ....12 
6   TEMPORARY REPAYMENT OF COSTS OF FILM PRODUCTION IN ICELAND  ..................  12 
7   RURAL TOURISM  ................................ ................................ ................................ ....... 14 
8   AID T O PROMOTE MARKETING OF ICELANDIC TOURISM.  ................................ ..........  14 
9   SCHEME TO SUPPORT INNOVATION COMPANIES  ................................ ......................  15 
10   RISK FINANCE AID FOR SMES  ................................ ................................ .................  15 
11   THE FISHERIES SECTOR  ................................ ................................ ..........................  16 
2022  ................................ ................................ ................................ ..............................  17 
1   THE AGRICULTURAL SECT OR ................................ ................................ .....................  17 
1.1   Agricultural Agreements; Payments to dairy farms, sheep farms and horticulture farms  ......17 
2   SUPPORT FOR R&D AND TECHNOLOGICAL INNOVATION  ................................ ..........  19 
2.1   Technical Development Fund  ................................ ................................ ........................ 19 
2.2   Research Fund  ................................ ................................ ................................ ........... 19 
2.3   Support for R&D in marine aquaculture  ................................ ................................ ......... 20 
3   SUPPORT TO SMALL AND MEDIUM -SIZED COMPANIES ................................ ..............  21 
3.1   Regional Development Fund  ................................ ................................ ......................... 21 
4   SUPPORT FOR EMPLOYMENT AND TRAINING  ................................ ............................  22 
4.1   Education and Training Fund  ................................ ................................ ........................ 22 
4.2   Employment Opportunities for Women in Rural Areas  ................................ ...................... 22 
4.3   Vocational Rehabilitation  ................................ ................................ ............................. 23 
4.4   Employment of Handicapped Persons  ................................ ................................ ............ 23 
5   REGIONAL SUPPORT  ................................ ................................ ................................ . 24 
5.1   Assistance to Employment Development Projects  ................................ ........................... 24 G/SCM/N/401/ISL  
 
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  5.2   Assistance to Local Economic Development  ................................ ................................ ....25 
6   TEMPORARY REPAYMENT OF COSTS OF FILMS PRODUCTION IN ICELAND  ................  25 
7   RURAL TOURISM  ................................ ................................ ................................ ....... 27 
8   AID T O PROMOTE MARKETING OF ICELANDIC TOURISM.  ................................ ..........  27 
9   SCHEME TO SUPPORT INNOVATION COMPANIES  ................................ ......................  28 
10   RISK FINANCE AID FOR SMES  ................................ ................................ .................  28 
11   THE FISHERIES SECTOR  ................................ ................................ ..........................  29 
 
 
  G/SCM/N/401/ISL  
 
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  2021  
1  THE AGRICULTURAL SECTOR  
1.1  Agricultural Agreements; Payments to dairy farms, sheep farms and horticulture 
farms  
(Budget items No . 04-801, 04 -805 & 04 -807).  
1. Background and authority for the subsidy  
Ministry of Industries and Innovation . 
2. Policy objective and/or purpose of the subsidy  
The main objective of the agreement is to strengthen Icelandic agriculture and provide the sector 
with the largest possible variety of opportunities for expansion. The aim of the agr eement is to 
provide the agricultural sector with a framework conducive to creating economic value and to making 
the most of opportunities present in the country 's rural areas, for the benefit of farmers, consumers 
and society at large. This development mu st be founded on specificity, sustainability and diversity. 
For that purpose, the agreement contains provisions on new projects designed to strengthen the 
operational basis of the agricultural sector and promote development and innovation.  
3. Form of the subsidy 
Agricultural subsidies in Iceland is mostly provided through direct payments, based on payment 
entitlements, which are in some cases coupled with production factors. Direct payments are provided 
to cattle (mainly dairy) and sheep producers, and, on a s maller scale, to certain greenhouse 
producers. Allocations for the Agricultural Agreements in 2021 are made under items 04 -801, 04 -805 
and 04 -807 of the State budget (Ministry of Industries and Innovation).  
4. Subsidy per unit, or in cases where this is not p ossible, the total amount or the annual amount 
budgeted for that subsidy  
Items making up the amount of support as measured by total costs in Government Accounts for  2021 
are listed in Table 1.  
Table 1  - Amount of support in 2021 ( government accounts); Mill ion ISK  
 2021  
Direct payments to sheep farmers  2.461  
Quality control scheme; sheep farmers  1.823  
Wool utilization; subsidies  475 
Direct payments to dairy farmers  4.725  
Direct payments to horticulture farmers  302 
Electricity subsidies to horticulture farmers (greenhouse)  385 
5. To whom and how the subsidy is provided  
Implementation of the agricultural policy revolves around Agricultural Agreements negotiated 
between the Government and the Farmer 's Association. Under Act No. 99/1993 on Agricultural 
Produce, with later amendments, the Minister of Fisheries and Agriculture is given the authority to 
negotiate with the Farmer 's Association on behalf of the Government on the total support target for 
milk, sheep and horticulture farming. Admin istered prices are applied for milk.  G/SCM/N/401/ISL  
 
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  Support is provided for dairy farms, sheep farms and horticulture farms (greenhouse).  
1.   Dairy farmers  
Milk producers receive direct payments from the Government on milk delivered to dairies and on 
support entitlements. Th e annual quantity must be within the allocated supported targets. The 
amount of monetary support per litre is the same for all producers in Iceland. Additional payments 
for delivered milk are to be made monthly for all delivered milk, irrespective of suppo rt entitlements.  
2.   Sheep farmers  
Sheep farmers receive direct payments from the Government which are based on support targets 
for sheep farming, for which they must own 70% live sheep. Additional payments to sheep farmers 
are related to a quality control sc heme for lamb meat, based on animal welfare, product quality and 
traceability, and sustainability criteria.  
3.   Sheep farmers; wool  
Sheep farmers receive support from the Government based on quantity and quality of wool 
produced.  
4.   Horticulture farmers  
Horticulture farmers producing cucumbers, peppers and tomatoes in greenhouses, mainly under 
artificial lighting receive direct payments from the government. The distribution of electricity used 
for artificial lighting is also subsidized to some extent by t he Government.  
6. Duration  of the subsidy  
The time of application of the agricultural agreements between the Government and the Farmer 's 
Association from 1st January 2017 until the end of 2026.  
7. Legal basis  
Act No. 99/1993 on Agricultural Produce with later amendments. The State Budget.  
8. Statistical data permitting an assessment of the trade effects of the subsidy  
An assessment of the trade effects of the subsidies is not available. Below, in tables 2, 3 and 4 there 
are, however, presented statistics on production and exports of the relevant agricultural 
commodities.  
Table 2  - Quantity of milk received by dairies and calculated exports by fat -content of 
milk derived products (in 1.000 of litres) for 2021  
Year Milk, received by dairies by 
fat-content  Expor ted products by fat -
content, thereof (%)  
2021 147.967  4% 
 
Table 3  - Sheep meat production and exports 2021 (in 1.000 kg)  
Year Production  Exports, thereof (%)  
2021 9.388  30% 
 
Table 4  - Tomato, cucumber and bell pepper production and exports 2021 (in 1.000 kg)  
Tomatoes  Cucumbers  Bell peppers  Total exports, thereof (%)  
1.234  2.067  184 <1% 
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  2  SUPPORT FOR R&D AND TECHNOLOGICAL INNOVATION  
2.1  Technical Development Fund  
1. Background and authority for the subsidy  
The Icelandic Centre for Research (Rannís) which is under the supervision of the Ministry of Industry 
and Innovation.  
2. Policy objective and/or purpose of the subsidy  
The objective of the Technology Development Fund is to facilitate innovation through supporting 
research and technological development . 
3. Amount and form of the subsidy  
The amount of State aid in 2021: ISK 4.389 million.  
4. To whom and how the subsidy is provided  
The role of the fund is to support research and development activities, which aim towards innovation 
in Icelandic industry. The Fund will in general operate as a competitive fund through which firms, 
research institutes and universities will have the possibility of financing projects that support 
technological development and innovation. The Fund is intended to give s upport to spin -off ventures 
and innovative firms to secure that economic benefits accrue to society from the scientific and 
technical knowledge and the innovation arising from these new ventures.  
The Science and Technology Policy Council attaches high impo rtance to close co -ordination between 
the Research Fund and the Technical Development Fund, as well as co -operation with other public 
funds and venture investors. The Technical Development Fund can take the initiative to establish 
programmes and specific a ctions prepared in consultation with the business community, research 
institutes and universities. Finally, the Technical Development Fund is permitted to enter into 
partnerships with venture capital investors for seed and early risk financing toward estab lishing firms 
which base their operations on technological development and research and which involves a novelty 
to the economy.  
5. Legal basis  
Act No. 3/2003 on Public Support for Scientific Research, with later amendments.  
6. Statistical data permitting an as sessment of the trade effects of the subsidy  
The support is granted to a variety of small projects and sectors, therefore it is difficult to present 
statistical data permitting an assessment of trade effects.  
7. Duration  of the subsidy  
The Technology Develo pment Fund has been operating since 2004. It took over from the Technology 
Fund which expired in 2004.  
2.2  Research Fund  
1. Background and authority for the subsidy  
The Icelandic Centre for Research (Rannís) which is under the supervision of the Ministry of Cultu re 
and Education.  G/SCM/N/401/ISL  
 
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  2. Policy objective and/or purpose of the subsidy  
The objective of the Research Fund is to facilitate fundamental research at University institutes or 
other Governmental R&D institutes.  
3. Amount and form of the subsidy  
The amount of State aid in 2021: ISK 3.165 million.  
4. To whom and how the subsidy is provided  
Subsidies are granted only on the basis of project applications. The Funds grants are for fundamental 
research at Universities and the involvement of private companies is very limited or non -existent.  
The Research Fund is the most powerful tool of the public sector for reinforcing the research 
community infrastructure through project grants based on applications from scientists, business 
firms and institutions. The Science and T echnology Policy Council encourages the Fund to give young 
scientists an opportunity to establish their work and contribute to the further accumulation of 
scientific and technical knowledge.  
The Research Fund offers grants in accordance with the priorities  set by the Science and Technology 
Policy Council and the grants strategy defined by the Science Board based on a peer review 
evaluation of research project quality, the competence of the individuals involved and the facilities 
available for completing the  project.  
5. Legal basis  
Act No. 3/2003 on Public Support for Scientific Research, with later amendments.  
6. Statistical data permitting an assessment of the trade effects of the subsidy  
The support is granted to a variety of small projects and sectors, theref ore it is difficult to present 
statistical data permitting an assessment of trade effects.  
7. Duration  of the subsidy  
Research Fund has been operating since 2004. It took over from the Science Fund which expired 
in 2004.  
2.3  Support for R&D in marine aquacultur e 
1. Background and authority for the subsidy  
Ministry of Fisheries and Agriculture.  
2. Policy objective and/or purpose of the subsidy  
To enhance scientific knowledge in marine aquaculture.  
3. Form of the subsidy  
Grants.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
2021: ISK 43,65 million  G/SCM/N/401/ISL  
 
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  5. To whom and how the subsidy is provided  
Grants are awarded on the basis of applications evaluated by a special committee.  
6. Duration  of the subsidy  
There is no time limit, but each programme is decided on for a year at a time.   
7. Legal basis  
Act No. 72/2008 on the Directorate of Fisheries.  
8. Statistical data permitting an assessment of the trade effects of the subsidy   
There is no trade  effect due to limited support.  
3  SUPPORT TO SMALL AND MEDIUM -SIZED COMPANIES  
3.1  Regional Development Fund  
1. Background and authority for the subsidy  
Innovation Center Iceland (Nýsköpunarmiðstöð Íslands) which is under the supervision of the 
Ministry of Employmen t and Innovation.  
2. Policy objective and/or purpose of the subsidy  
To promote cooperation between local governments, safeguard their interests, support industries 
and enhance quality of life in the entire region economically, socially and culturally.  
3. Form o f the subsidy  
Grants.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy   
2021: ISK 582,4 million  
5. To whom and how the subsidy is provided  
Grants are awarded on the basis of application s evaluated by a special committee.  
6. Duration  of the subsidy  
There is no time limit.  
7. Legal basis  
Act No . 69/2015 (Lög um byggðaáætlun og sóknaráætlun) and the Budget item No. 10-701-115 
8. Statistical data permitting an assessment of the trade effects of the subsidy  
There are no trade effects of the support due to the general framework of the scheme and limited 
support.  G/SCM/N/401/ISL  
 
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  4  SUPPORT FOR EMPLOYMENT AND TRAINING  
4.1  Education and Training Fund  
1. Backgro und and authority for the subsidy  
Ministry of Social Affairs and Labour  
2. Policy objective and/or purpose of the subsidy  
The role of the Education Fund is to work to ensure the availability of suitable educational 
opportunities for those with limited formal  education. A further role of the Fund is to contribute to 
the creation of suitable conditions for individuals ' pursuit of such educational opportunities.  
3. Form of the subsidy  
Grants.  
4. Subsidy per unit, or in cases where this is not possible, the total amoun t or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2021: ISK 1.842,5 million  
5. To whom and how the subsidy is provided  
Grants from the Education Fund are divided into three main categories:  
a. contributions to accredited  education prov iders to meet the cost of providing teaching and  
organising courses.  
b. contributions to cover costs related to validation of competence and educational and  
vocational guidance.  
c. grants for innovation and development projects in adult education.  
The Responsibility for allocation of funding from the Education Fund lies with the Fund 's Board of 
Directors.  
6. Duration  of the subsidy  
The Act on Adult Education came into force 2010.  
7. Legal basis  
Adult Education Act No. 27/2010 and he Budget item No. 07 -450-110, 07 -451-101, 07 -452-110, 
07-453-110 and 07 -454-110.  
4.2  Employment Opportunities for Women in Rural Areas  
1. Background and authority for the subsidy  
Ministry of Fisheries and Agriculture and the Institute of Regional Development (Byggðastofnun).  
2. Policy objective and/or purpose of the subsidy  
The main purpose of this programme is to create new jobs for women in sparsely populated areas. 
Areas where high unemployment is among women will especially b e considered.   
3. Form of the subsidy  
Soft loans, up to 50% of primary R&D costs, innovation costs and cost of new products, process and 
systems for industrial production. Institute of Regional Development pays the grants and controls 
their disposition.  G/SCM/N/401/ISL  
 
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  4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2021: ISK 35,49 million  
5. To whom and how the subsidy is provided  
Grants to women on application to the Institut e of Regional Development mainly to new product 
developing and marketing. The grant can only be given to companies, which are at least 50% owned 
by women or have been established by women.  
6. Duration  of the subsidy  
The programme started in 1990. Duration has  not been specified.  
7. Legal basis  
Governmental decision from 1990.  
4.3  Vocational Rehabilitation  
1. Background and authority for the subsidy  
Ministry of Social Affairs and Labour.  
2. Policy objective and/or purpose of the subsidy  
The main purpose of this programme is to develop, integrate and monitor services in the field of 
vocational rehabilitation; aiming systematically for employment of individuals following illness or 
injury.  
3. Form of the subsidy  
Gross wage State aid to rehabilitation centres.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2021: ISK 1.104,6 million  
5. To whom and how the subsidy is provided  
The rehabilitation centres must have operating l icense from the Ministry of Ministry of Social Affairs 
and Labour to apply to the Ministry for subsidies.   
6. Duration  of the subsidy  
Duration has not been specified.  
7. Legal basis  
Act No. 60/2012 (lög um atvinnutengda starfsendurhæfingu og starfsemi starfsend urhæfinga -sjóða) 
and financed by the Budget item Nos. 07 -986 and 07 -988. 
4.4  Employment of Handicapped Persons  
1. Background and authority for the subsidy  
Ministry of Social Affairs and Labour.  G/SCM/N/401/ISL  
 
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  2. Policy objective and/or purpose of the subsidy  
The main purpose of this programme is to ensure that disabled persons enjoy human rights and 
freedoms on the same basis as others and that they are guaranteed the support necessary to enjoy 
these rights.  
3. Form of the subsidy  
Gross wage State aid to rehabilitation ce ntres.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2021: ISK 206,5 million.  
5. To whom and how the subsidy is provided  
Service institutions for disabled people should be deployed in order to meet their specific needs so 
that they can live independently.  
6. Duration  of the subsidy  
Duration has not been specified.   
7. Legal basis  
Act No. 36/2018 (lög um þjónustu við fatlað fólk með langvarandi stuðningsþ arfir) and the Budget 
item No. 07-981-121. 
5  REGIONAL SUPPORT  
5.1  Assistance to Employment Development Projects  
1. Background and authority for the subsidy  
Institute of Regional Development (Byggðastofnun).  
2. Policy objective and/or purpose of the subsidy  
The object ive of the programme is to assist the economic development of the nationally assisted 
areas of Iceland. The assisted projects are small and cover employment development, training and 
innovation.  
3. Form of the subsidy  
Grants, as assistance to Employment Devel opment Projects, which fall within the objectives of 
Act No. 106/1999, on the Institute of Regional Development.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expendit ure in 2021: ISK 207,30 million.  
5. To whom and how the subsidy is provided  
The programme is available to individuals, private companies, local development companies and 
municipalities.   G/SCM/N/401/ISL  
 
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  6. Duration  of the subsidy  
The programme has no time limit, the amount is decided on in the Budget each year.  
7. Legal basis  
Article 10 of Act No. 106 /1999 on the Institute of Regional Development, the Budget 
item No. 04-542. 
5.2  Assistance to Local Economic Development  
1. Background and authority for the subsidy  
Institute of Regional Development (Byggðastofnun).  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to assist local economic development companies and to finance 
venturesome projects within the field of local employment development and innovation.  
3. Form of the subsidy  
Grants to finance venturesome projects within the fie ld of local employment development and 
innovation.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2021: ISK 1.338,90 million.  
5. To whom and how the subsidy  is provided  
According to Act No. 106/1999, with later amendments, on the Institute of Regional Development, 
the assistance is to be in accordance with rules laid down by the Ministry of Employment and 
Innovation.  
6. Duration  of the subsidy  
The programme has  no time limit, the amounts are decided on in the Budget each year.  
7. Legal basis  
Article 12 of Act No. 106/1999 on the Institute of Regional Development, the Budget 
item No. 04-542.1.10.  
8. Additional information  
The Institute of Regional Development is authorized according to Article 11 of Act No . 106/1999 to 
provide loans and guarantees, in accordance with the role of the Institute as stipulated in the Act. 
These loans and guarantees are provided on market terms, with similar interest rat es as on the open 
market.  
6  TEMPORARY REPAYMENT OF COSTS OF FILM PRODUCTION IN ICELAND  
1. Background and authority for the subsidy  
Icelandic film centre (Kvikmyndamiðstöð Íslands) under the auspice of the Ministry of Industry and 
Innovation.  G/SCM/N/401/ISL  
 
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  2. Policy objective an d/or purpose of the subsidy  
The objective of the Act is to enhance domestic culture and promote the history and nature of Iceland 
by temporarily supporting motion pictures and television programmes produced in Iceland.  
According to the Act authorisation i s granted for the reimbursement from the State Treasury of a 
proportion of the production costs incurred in the production of films and television programmes in 
Iceland.  
When more than 80% of the total production cost of a motion picture or television pro gramme incurs 
in Iceland, the reimbursement shall be calculated from the total production cost incurring within the 
European Economic Area.  
Production costs refers to all costs incurred in Iceland deductible from the revenues of enterprises 
pursuant to the  provisions of the Act on Income and Net Wealth Tax. Payments pertaining to 
employees and contractors are only to be included in production costs if they are verifiable taxable 
in Iceland  
3. Form of the subsidy  
A specific company shall be established in Icela nd for the production; an Icelandic branch or agency 
of a company registered in another Member State of the European Economic Area shall be considered 
a specific company . 
4. Subsidy per unit, or in cases where this is not possible, the total amount or the ann ual amount 
budgeted for that subsidy  
Total expenditure (reimbursement of production cost) in 2021: ISK 2.247,80 million.  
5. To whom and how the subsidy is provided  
In assessing whether a proportion of the production costs of a motion picture or a television 
programme shall be reimbursed, the following conditions shall be fulfilled:  
(a) the production shall be suited for promoting Icelandic culture and the history and nature of 
Iceland;  
(b) the production shall be suited for enhancing the experience, knowledge and arti stic ambition 
of those involved in the production;  
(c) a specific company shall be established in Iceland for the production; an Icelandic branch or 
agency of a company registered in another EEA member state shall be considered a specific 
company;  
(d) information on the principal parties involved in the film or television programme shall be 
submitted;  
(e) information on domestic parties and their share in the production of the film or television 
programme shall be submitted;  
(f) an itemized estimate of the production costs and sources of funding shall be submitted, 
together with confirmation by the funding parties and a declaration by the producer to the 
effect that the production conforms with the aims of the Act No. 43/1999;  
(g) information on the content of t he proposed film or television programme shall be submitted, 
including a manuscript, synopsis and information about filming locations;  
(h) a production plan shall be available (i.e. filming, post -production and marketing plan), 
providing for completion of the production within three years of receipt of the application for 
reimbursement;  
(i) a statement shall be submitted to the effect that the material to be produced is intended for 
general distribution to cinemas or television stations, the content of the film or television 
programme shall not violate the Film Censorship and Prohibition of Violent Films Act, 
No. 47/1995, or Article 210 of the Criminal Code, No. 19/1940.  
6. Duration  of the subsidy  
The programme is limited to end of year 2025.  G/SCM/N/401/ISL  
 
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  7. Legal basis  
Act on Tempora ry Reimbursements in Respect of Film Making in Iceland, No. 43/1999, with 
amendments. The Budget item No. 04-521.   
7  RURAL TOURISM  
1. Background and authority for the subsidy  
Minister of Tourism, Industry and Innovation.  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to promote rural tourism and assist local museums, and places 
of historical importance, in attracting tourists.  
3. Form of the subsidy  
Grants to projects.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Total expenditure allowed in 2021: ISK 154,00 million.  
5. Duration  of the subsidy  
The programme has no time limit, the amounts are decided on in the Budget each year.  
6. Legal basis  
Budget, item No. 04-551. 
8  AID TO PROMOTE MARKETING OF ICELANDIC TOURISM.  
1. Background and authority for the subsidy  
Ministry of Culture and Business Affairs and Icelandic Tourism Board (Ferðamálastofa).  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to promote marketing of Icelandic tourism.   
3. Form of the subsidy  
Grants to projects.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Total expenditu re allowed in 2021: ISK 915,00 million.  
5. Duration  of the subsidy  
The amounts are decided on in the Budget each year.  
6. Legal basis  
Budget, item No. 04-559.1.44.  G/SCM/N/401/ISL  
 
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  9  SCHEME TO SUPPORT INNOVATION COMPANIES  
1. Background and authority for the subsidy  
Ministry of Financ e and Economic Affairs.  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to promote research and development work and to improve the 
competitive conditions of innovation companies by giving them the right to deduct tax for t he cost 
of innovation projects.  
3. Form of the subsidy  
Grants to projects.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Total expenditure allowed in 2021: ISK 10.431,00 million.  
5. Duration  of the subsidy  
Duration not limited.  
6. Legal basis  
Act No. 152/2009 on support for innovation enterprises.  
10  RISK FINANCE AID FOR SMES  
1. Background and authority for the subsidy  
Ministry of Finance and Economic Affairs and Directorate of Intern al Revenue (Ríkisskattstjóri).  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to improve Icelandic companies ' competitiveness as well as 
support innovation and development.  
This scheme does not apply to investments in comp anies in real estate activities, activities consisting 
in the leasing of movable assets or real estate, holding and investment companies, certain regulated 
entities, sales of services and expert advice, film production, building construction, hotels, hoste ls, 
restaurants, import/export of products which are developed by others and mining.  
3. Form of the subsidy  
Grants to projects.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Total exp enditure allowed in 2021: ISK 246,69 million.   
5. Duration  of the subsidy  
The programme started 30/06/2016 and is limited to end of year 2022.  G/SCM/N/401/ISL  
 
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  6. Legal basis  
Article 30(1), section B, of the Income Tax Act No . 90/2003.  
11  THE FISHERIES SECTOR  
Iceland did not grant or maintain subsidies to fishing or fishing related activity as defined in 
Article  1.1 of the Agreement on Subsidies and Countervailing Measures, which are specific within 
the meaning of Article 2 of that Agreement.  
  G/SCM/N/401/ISL  
 
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  2022  
1  THE AGRICULTURAL SECTOR  
1.1  Agricultural Agreements; Payments to dairy farms, sheep farms and horticulture 
farms  
(Budget items No . 04-801, 04 -805 & 04 -807).  
1. Background and authority for the subsidy  
Ministry of Food, Agriculture and Fisheries and  
2. Policy objective and/or purpose of the subsidy  
The main objective of the agreement is to strengthen Icelandic agriculture and provide the sector 
with the largest possible variety of opportunities for expansion. The aim of the agreement is to 
provide the agricultural sector  with a framework conducive to creating economic value and to making 
the most of opportunities present in the country 's rural areas, for the benefit of farmers, consumers 
and society at large. This development must be founded on specificity, sustainability  and diversity. 
For that purpose, the agreement contains provisions on new projects designed to strengthen the 
operational basis of the agricultural sector and promote development and innovation.  
3. Form of  the subsidy  
Agricultural subsidies in Iceland are mo stly provided through direct payments, based on payment 
entitlements, which are in some cases coupled with production factors. Direct payments are provided 
to cattle (mainly dairy) and sheep producers, and, on a smaller scale, to certain greenhouse 
produce rs. Allocations for the Agricultural Agreements in 2022 are made under items 04 -801, 04 -805 
and 04 -807 of the State budget (Ministry of Food, Agriculture and Fisheries).  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annu al amount 
budgeted for that subsidy  
Items making up the amount of support as measured by total costs in Government Accounts for 
2022 are listed in Table 1.  
Table 1  - Amount of support in 2022 (Government Accounts); Million ISK  
 2022  
Direct payments to sheep farmers  2.564  
Quality control scheme; sheep farmers  2.849* 
Wool utilization; subsidies  495 
Direct payments to dairy farmers  4.916  
Direct payments to horticulture farmers  314 
Electricity subsidies to horticulture farmers (greenhouse)  506** 
*Thereof are 950 mISK a part of a one -time additional support due to unprecedented price increase in inputs.  
**Thereof are 101 mISK  a part of a one -time additional support due to unprecedented price increase in inputs. 
5. To whom and how the subsidy is provided  
Implementation of the agricultural policy revolves around Agricultural Agreements negotiated 
between the Government and the Farm er's Association. Under Act No. 99/1993 on Agricultural 
Produce, with later amendments, the Minister of Food, Agriculture and Fisheries is given the 
authority to negotiate with the Farmer 's Association on behalf of the Government on the total support 
target for milk, sheep, and horticulture farming. Administered prices are applied for milk.  G/SCM/N/401/ISL  
 
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  Support is provided for dairy farms, sheep farms and horticulture farms (greenhouse).  
1.   Dairy farmers  
Milk producers receive direct payments from the Governme nt on milk delivered to dairies and on 
support entitlements. The annual quantity must be within the allocated supported targets. The 
amount of monetary support per litre is the same for all producers in Iceland. Additional payments 
for delivered milk are t o be made monthly for all delivered milk, irrespective of support entitlements.  
2.   Sheep farmers  
Sheep farmers receive direct payments from the Government which are based on support targets 
for sheep entitlements, for which they must own 70% live sheep. Additional payments to sheep 
farmers are related to a quality control scheme for lamb meat, based on animal welfare, product 
quality and traceability, and sustainability criteria.  
3.   Sheep farmers; wool  
Sheep farmers receive support from the Government  based on quantity and quality of wool 
produced.  
4.   Horticulture farmers  
Horticulture farmers producing cucumbers, peppers and tomatoes in greenhouses, mainly under 
artificial lighting receive direct payments from the government. The distribution of electric ity used 
for artificial lighting is also subsidized to some extent by the Government.  
6. Duration  of the subsidy  
The time of application of the agricultural agreements between the Government and the Farmer´s 
Association from 1st January 2017 until the end of 2026.  
7. Legal basis  
Act No. 99/1993 on Agricultural Produce with later amendments. The State Budget.  
8. Statistical data permitting an assessment of the trade effects of the subsidy  
An assessment of the trade effects of the subsidies is not available. Below, i n Tables 2, 3 and 4 there 
are, however, presented statistics on production and exports of the relevant agricultural 
commodities.  
Table 2  - Quantity of milk received by dairies and calculated exports by fat -content of 
milk derived products (in 1.000 of litr es) for 2022  
Year Milk, received by dairies by 
fat-content  Exported products by fat -
content, thereof (%)  
2022 148.828  2% 
 
Table 3  - Sheep meat production and exports 2022 (in 1.000 kg)  
Year Production  Exports, thereof (%)  
2022 8.649  36% 
 
Table 4  - Tomato, cucumber and bell pepper production and exports 2022 (in 1.000 kg)  
Tomatoes  Cucumbers  Bell peppers  Total exports, thereof (%)  
1.461  2.086  168 <1% 
 G/SCM/N/401/ISL  
 
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  2  SUPPORT FOR R&D AND TECHNOLOGICAL INNOVATION  
2.1  Technical Development Fund  
1. Background and authority for the subsidy  
The Icelandic Centre for Research (Rannís) which is under the supervision of the Ministry of Culture 
and Business Affairs.  
2. Policy objective and/or purpose of the subsidy  
The objective of the Technology Development Fund is to facilitate innovation through supporting 
research and technological development.  
3. Amount and form of the subsidy  
The amount of State aid in 2022: ISK 4.148,00 million.  
4. To whom and how the subsidy is provided  
The role of the fund is to support research and d evelopment activities, which aim towards innovation 
in Icelandic industry. The Fund will in general operate as a competitive fund through which firms, 
research institutes and universities will have the possibility of financing projects that support 
technol ogical development and innovation. The Fund is intended to give support to spin -off ventures 
and innovative firms to secure that economic benefits accrue to society from the scientific and 
technical knowledge and the innovation arising from these new ventu res. 
The Science and Technology Policy Council attaches high importance to close co -ordination between 
the Research Fund and the Technical Development Fund, as well as co -operation with other public 
funds and venture investors. The Technical Development Fu nd can take the initiative to establish 
programmes and specific actions prepared in consultation with the business community, research 
institutes and universities. Finally, the Technical Development Fund is permitted to enter into 
partnerships with venture  capital investors for seed and early risk financing toward establishing firms 
which base their operations on technological development and research and which involves a novelty 
to the economy.  
5. Legal basis  
Act No. 3/2003 on Public Support for Scientific R esearch, with later amendments.  
6. Statistical data permitting an assessment of the trade effects of the subsidy  
The support is granted to a variety of small projects and sectors, therefore it is difficult to present 
statistical data permitting an assessment  of trade effects.  
7. Duration  of the subsidy  
The Technology Development Fund has been operating since 2004. It took over from the Technology 
Fund which expired in 2004.  
2.2  Research Fund  
1. Background and authority for the subsidy  
The Icelandic Centre for Research  (Rannís) which is under the supervision of the Ministry of Culture 
and Business Affairs.  G/SCM/N/401/ISL  
 
- 20 - 
 
  2. Policy objective and/or purpose of the subsidy s 
The objective of the Research Fund is to facilitate fundamental research at University institutes or 
other Governmenta l R&D institutes.  
3. Amount and form of the subsidy  
The amount of State aid in 2022: ISK 1.412,00 million.  
4. To whom and how the subsidy is provided  
Subsidies are granted only on the basis of project applications. The Funds grants are for fundamental 
research a t Universities and the involvement of private companies is very limited or non -existent.  
The Research Fund is the most powerful tool of the public sector for reinforcing the research 
community infrastructure through project grants based on applications from scientists, business 
firms and institutions. The Science and Technology Policy Council encourages the Fund to give young 
scientists an opportunity to establish their work and contribute to the further accumulation of 
scientific and techni cal knowledge.  
The Research Fund offers grants in accordance with the priorities set by the Science and Technology 
Policy Council and the grants strategy defined by the Science Board based on a peer review 
evaluation of research project quality, the compet ence of the individuals involved and the facilities 
available for completing the project.  
5. Legal basis  
Act No. 3/2003 on Public Support for Scientific Research, with later amendments.  
6. Statistical data permitting an assessment of the trade effects of the su bsidy  
The support is granted to a variety of small projects and sectors, therefore it is difficult to present 
statistical data permitting an assessment of trade effects.  
7. Duration  of the subsidy  
Research Fund has been operating since 2004. It took over fr om the Science Fund which expired 
in 2004.  
2.3  Support for R&D in marine aquaculture  
1. Background and authority for the subsidy  
Ministry of Food, Agriculture and Fisheries.  
2. Policy objective and/or purpose of the subsidy  
To enhance scientific knowledge in marine aquaculture.  
3. Form of the subsidy  
Grants.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
2022: 33,21 million ISK  G/SCM/N/401/ISL  
 
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  5. To whom and how the subsidy is provided  
Grants are awarded on  the basis of applications evaluated by a special committee.  
6. Duration  of the subsidy  
There is no time limit, but each programme is decided on for a year at a time.   
7. Legal basis  
Act No. 72/2008 on the Directorate of Fisheries.  
8. Statistical data permitting an assessment of the trade effects of the subsidy  
There is no trade effect due to limited support.  
3  SUPPORT TO SMALL AND MEDIUM -SIZED COMPANIES  
3.1  Regional Development Fund  
1. Background an d authority for the subsidy  
Ministry of Infrastructure . 
2. Policy objective and/or purpose of the subsidy  
To promote cooperation between local governments, safeguard their interests, support industries 
and enhance quality of life in the entire region economic ally, socially and culturally.  
3. Form of the subsidy  
Grants.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy   
2022: ISK 569,4 million  
5. To whom and how the subsidy is provided  
Grants a re awarded on the basis of applications evaluated by a special committee.  
6. Duration  of the subsidy  
There is no time limit.   
7. Legal basis  
Act No . 69/2015 (Lög um byggðaáætlun og sóknaráætlun) and the Budget item No. 10-701-115 
8. Statistical data permitting an assessment of the trade effects of the subsidy  
There are no trade effects of the support due to the general framework of the scheme and limited 
support.  G/SCM/N/401/ISL  
 
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  4  SUPPORT FOR EMPLOYMENT AND TRAINING  
4.1  Education and Training Fund  
1. Background and authority for the subsidy  
Ministry of Social Affairs and Labour . 
2. Policy objective and/or purpose of the subsidy  
The role of the Education Fund is to work to ensure the availability of suitable educational 
opportunities for those with limited  formal education. A further role of the Fund is to contribute to 
the creation of suitable conditions for individuals ' pursuit of such educational opportunities.  
3. Form of the subsidy  
Grants.  
4. Subsidy per unit, or in cases where this is not possible, the tota l amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2022: ISK 1.678,5 million  
5. To whom and how the subsidy is provided  
Grants from the Education Fund are divided into three main categories:  
1.   contributions to accredited  educati on providers to meet the cost of providing teaching and  
organising courses ; 
2.   contributions to cover costs related to validation of competence and educational and  
vocational guidance ; 
3.   grants for innovation and development projects in adult education.  
The Responsibility for allocation of funding from the Education Fund lies with the Fund 's Board of 
Directors.  
6. Duration  of the subsidy  
The Act on Adult Education came into force 2010.  
7. Legal basis  
Adult Education Act No. 27/2010 and Budget items No. 07 -450, 07 -451, 07 -452, 07 -453 
and 07-454.  
4.2  Employment Opportunities for Women in Rural Areas  
1. Background and authority for the subsidy  
Ministry of Infrastructure and the Institute of Regional Development  (Byggðastofnun).  
2. Policy objective and/or purpose of the subsidy  
The main purpose of this programme is to create new jobs for women in sparsely populated areas. 
Areas where high unemployment is among women will especially be considered.   
3. Form of the subsi dy 
Soft loans, up to 50% of primary R&D costs, innovation costs and cost of new products, process and 
systems for industrial production. Institute of Regional Development pays the grants and controls 
their disposition.  G/SCM/N/401/ISL  
 
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  4. Subsidy per unit, or in cases where t his is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2022: ISK 32,50 million  
5. To whom and how the subsidy is provided  
Grants to women on application to the Institute of Regional Development mainly  to new product 
developing and marketing. The grant can only be given to companies which are at least 50% owned 
by women or have been established by women.  
6. Duration  of the subsidy  
The programme started in 1990. Duration has not been specified.  
7. Legal basis  
Governmental decision from 1990.  
4.3  Vocational Rehabilitation  
1. Background and authority for the subsidy  
Ministry of Social Affairs and Labour.  
2. Policy objective and/or purpose of the subsidy  
The main purpose of this programme is to develop, integrate and monitor services in the field of 
vocational rehabilitation; aiming systematically for employment of individuals following illness or 
injury.  
3. Form of the subsidy  
Gross wage State aid to rehabilitation centres.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2022: ISK 1.167,5 million  
5. To whom and how the subsidy is provided  
The rehabilitation centres must have op erating license from the Ministry of Social Affairs and Labour 
to apply to the Ministry for subsidies.   
6. Duration  of the subsidy  
Duration has not been specified.   
7. Legal basis  
Act No. 60/2012 (lög um atvinnutengda starfsendurhæfingu og starfsemi starfsendu rhæfingasjóða) 
and financed by the Budget item Nos. 07 -986 and 07 -988. 
4.4  Employment of Handicapped Persons  
1. Background and authority for the subsidy  
Ministry of Social Affairs and Labour.  G/SCM/N/401/ISL  
 
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  2. Policy objective and/or purpose of the subsidy  
The main purpose of thi s programme is to ensure that disabled persons enjoy human rights and 
freedoms on the same basis as others and that they are guaranteed the support necessary to enjoy 
these rights.  
3. Form of the subsidy  
Gross wage State aid to rehabilitation centres.  
4. Subsidy  per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2022: ISK 220,7 million.  
5. To whom and how the subsidy is provided  
Service institutions for disabled people should be deployed in order to meet their specific needs so 
that they can live independently.  
6. Duration  of the subsidy  
Duration has not been specified.   
7. Legal basis  
Act No. 36/2018 (lög um þjónustu við fatlað fólk með langvarandi stuðningsþarfir) and the B udget 
item No. 07-981-121. 
5  REGIONAL SUPPORT  
5.1  Assistance to Employment Development Projects  
1. Background and authority for the subsidy  
Institute of Regional Development (Byggðastofnun).  
2. Policy objective and/or purpose of the subsidy  
The objective of the progr amme is to assist the economic development of the nationally assisted 
areas of Iceland. The assisted projects are small and cover employment development, training and 
innovation.  
3. Form of the subsidy  
Grants, as assistance to Employment Development Projects,  which fall within the objectives of 
Act No. 106/1999, on the Institute of Regional Development.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2022: IS K 206,30 million.  
5. To whom and how the subsidy is provided  
The programme is available to individuals, private companies, local development companies and 
municipalities.  G/SCM/N/401/ISL  
 
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  6. Duration  of the subsidy  
The programme has no time limit, the amount is decided on in th e Budget each year.  
7. Legal basis  
Article 10 of Act No. 106/1999 on the Institute of Regional Development, the Budget 
item No. 04-542. 
5.2  Assistance to Local Economic Development  
1. Background and authority for the subsidy  
Institute of Regional Development (Byggðastofnun).  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to assist local economic development companies and to finance 
venturesome projects within the field of local employment development and innovation . 
3. Form of the subsidy  
Grants to finance venturesome projects within the field of local employment development and 
innovation.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Actual total expenditure in 2022: ISK 1.090,10 million.  
5. To whom and how the subsidy is provided  
According to Act No. 106/1999, with later amendments, on the Institute of Regional Development, 
the assistance is to be in accordance with rules laid down by the Minis try of Infrastructure. These 
rules have not yet been issued. The subsidies are subject to the conditions laid down in the EFTA 
Surveillance Authority State Aid Guidelines and the Map of Regional Aid approved by the EFTA 
Surveillance Authority.  
6. Duration  of the subsidy  
The programme has no time limit, the amounts are decided on in the Budget each year.  
7. Legal basis  
Article 12 of Act No. 106/1999 on the Institute of Regional Development, the Budget item 
No. 04-542.1.10.  
8. Additional information  
The Institute of R egional Development is authorized according to Article 11 of Act No . 106/1999 to 
provide loans and guarantees, in accordance with the role of the Institute as stipulated in the Act. 
These loans and guarantees are provided on market terms, with similar inte rest rates as on the open 
market.  
6  TEMPORARY REPAYMENT OF COSTS OF FILMS PRODUCTION IN ICELAND  
1. Background and authority for the subsidy  
Icelandic film centre (Kvikmyndamiðstöð Íslands) under the auspice of the Ministry of Culture and 
Business Affairs.  G/SCM/N/401/ISL  
 
- 26 - 
 
  2. Policy objective and/or purpose of the subsidy  
The objective of the Act is to enhance domestic culture and promote the history and nature of Iceland 
by temporarily supporting motion pictures and television programmes produced in Iceland.  
Accordin g to the Act authorisation is granted for the reimbursement from the State Treasury of a 
proportion of the production costs incurred in the production of films and television programmes in 
Iceland.  
When more than 80% of the total production cost of a moti on picture or television programme incurs 
in Iceland, the reimbursement shall be calculated from the total production cost incurring within the 
European Economic Area.  
Production costs refers to all costs incurred in Iceland deductible from the revenues of  enterprises 
pursuant to the provisions of the Act on Income and Net Wealth Tax. Payments pertaining to 
employees and contractors are only to be included in production costs if they are verifiable taxable 
in Iceland.  
3. Form of the subsidy  
A specific company shall be established in Iceland for the production; an Icelandic branch or agency 
of a company registered in another Member State of the European Economic Area shall be considered 
a specific company.  
4. Subsidy per unit, or in cases where this is not possible , the total amount or the annual amount 
budgeted for that subsidy  
Total expenditure (reimbursement of production cost) in 2022: ISK 3.366,97 million.  
5. To whom and how the subsidy is provided  
In assessing whether a proportion of the production costs of a mo tion picture or a television 
programme shall be reimbursed, the following conditions shall be fulfilled:  
(a) the production shall be suited for promoting Icelandic culture and the history and nature of 
Iceland;  
(b) the production shall be suited for enhancing the experience, knowledge and artistic ambition 
of those involved in the production;  
(c) a specific company shall be established in Iceland for the production; an Icelandic branch or 
agency of a company registered in another EEA member state shall be considered a specific 
company;  
(d) information on the principal parties involved in the film or television programme shall be 
submitted;  
(e) information on domestic parties and their share in the production of the film or television 
programme shall be submitted;  
(f) an itemized e stimate of the production costs and sources of funding shall be submitted, 
together with confirmation by the funding parties and a declaration by the producer to the 
effect that the production conforms with the aims of the Act No. 43/1999;  
(g) information on t he content of the proposed film or television programme shall be submitted, 
including a manuscript, synopsis and information about filming locations;  
(h) a production plan shall be available (i.e. filming, post -production and marketing plan), 
providing for com pletion of the production within three years of receipt of the application for 
reimbursement;  
(i) a statement shall be submitted to the effect that the material to be produced is intended for 
general distribution to cinemas or television stations, the content of the film or television 
programme shall not violate the Film Censorship and Prohibition of Violent Films Act, 
No. 47/1995, or Article 210 of the Criminal Code, No. 19/1940.  
6. Duration  of the subsidy  
The programme is limited to end of year 2025.  G/SCM/N/401/ISL  
 
- 27 - 
 
  7. Legal basis  
Act on Temporary Reimbursements in Respect of Film Making in Iceland, No. 43/1999, with 
amendments. The Budget item No. 04-521.   
7  RURAL TOURISM  
1. Background and authority for the subsidy  
Minister of Culture and Business Affairs.  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to promote rural tourism and assist local museums, and places 
of historical importance, in attracting tourists.  
3. Form of the subsidy  
Grants to projects.  
4. Subsidy per unit, or in cases where this  is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Total expenditure allowed in 2022: ISK 165,00 million.  
5. Duration  of the subsidy  
The programme has no time limit, the amounts are decided on in the Budget each year.  
6. Legal bas is 
Budget, item No. 04-551. 
8  AID TO PROMOTE MARKETING OF ICELANDIC TOURISM.  
1. Background and authority for the subsidy  
Ministry of Culture and Business Affairs and Icelandic Tourism Board (Ferðamálastofa).  
2. Policy objective and/or purpose of the subsidy  
The ob jective of the programme is to promote marketing of Icelandic tourism.   
3. Form of the subsidy  
Grants to projects.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Total expenditure allowed in 2022: ISK 865,00 million.  
5. Duration  of the subsidy  
The amounts are decided on in the Budget each year.  
6. Legal basis  
Budget, item No. 04-559.1.44.  G/SCM/N/401/ISL  
 
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  9  SCHEME TO SUPPORT INNOVATION COMPANIES  
1. Background and authority for the subsidy  
Ministry of Finance and Economic Affairs.  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to promote research and development work and to improve the 
competitive conditions of innovation companies by giving them the right to deduct tax for the cost 
of innovation projects.  
3. Form of the subsidy  
Grants to projects.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Total expenditure allowed in 2022: ISK 11.308,00 mill ion. 
5. Duration  of the subsidy  
Duration not limited.  
6. Legal basis  
Act No. 152/2009 on support for innovation enterprises.  
10  RISK FINANCE AID FOR SMES  
1. Background and authority for the subsidy  
Ministry of Finance and Economic Affairs and Icelandic Revenue and Customs (Skatturinn).  
2. Policy objective and/or purpose of the subsidy  
The objective of the programme is to improve Icelandic companies ' competitiveness as well as 
support innovation and development.  
This scheme does not apply to investments in companies in real estate activities, activities consisting 
in the leasing of movable assets or real estate, holding and investment companies, certain regulated 
entities, sales of services and expert advice, film production, building construction, hotels, hostels, 
restaurants, import/export of products which are developed by others and mining.  
3. Form of the subsidy  
Grants to projects.  
4. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy  
Total expenditure allowed in 2022: ISK 124,69 million.  
5. Duration  of the subsidy  
The programme started 30/06/2016 and is limited to end of year 2022.  G/SCM/N/401/ISL  
 
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  6. Legal basis  
Article 30(1), section B, of the Income Tax Act No . 90/2003  
11  THE FISHERIES SECTOR  
Iceland did not grant  or maintain subsidies to fishing or fishing related activity as defined in 
Article  1.1 of the Agreement on Subsidies and Countervailing Measures, which are specific within 
the meaning of Article 2 of that Agreement.  
 
__________  