WORLD TRADE
ORGANIZATIONG/SCM/N/48/EEC/Add.13
6 January 2000
(00-0041)
Committee on Subsidies
and Countervailing MeasuresOriginal:  Spanish
SUBSIDIES
Updating Notification Pursuant to Article XVI:1 of the GATT 1994
and Article 25 of the Agreement on Subsidies and
Countervailing Measures
EUROPEAN COMMUNITIES
Addendum
The following addendum to the notification of  the European Community relates to subsidy
programmes of Spain.G/SCM/N/48/EEC/Add.13
Page 2
SPAIN
TABLE OF CONTENTS
Page
I. FISHERIES .................................................................................................................... .......3
1. 1998 BUDGET – CO-FINANCED P ART OF NATIO NAL AID .....................................3
2. AID TO SHIPOWNERS AFFECTED BY  THE STOPPAGE OF FISHING .................3
II. INDUSTRY AND ENERGY ................................................................................................4
1. PROMOTION OF THE ECONOMIC AND SOCIAL SECTORS OF THE AGRI-
FOOD INDUS TRY ...............................................................................................................4
2. MINING (OTHER THAN ENER GY)................................................................................5
3. ENERGY SAVING AND EFFICIENCY  PLAN................................................................6
4. AID TO SHIPBUILDING....................................................................................................7
A. S HIPBUILDING SUBSIDIES .......................................................................................................7
B. I NTEREST SUBSIDY FOR SHIPBUILDING LOANS ......................................................................9
5. SUPPORT INITIATIVE FOR TECHNOLOGY, QUALITY AND INDUSTRIAL
SAFETY (A TYCA) .............................................................................................................10
6. AID UNDER TECHNOLOGICAL PROGRAMMES CONNECTED WITH
THE SEAT MODERNI ZATION PLAN ..........................................................................11
7. R&D PLAN FOR THE AE RONAUTICAL SECTOR ...................................................12
III. SMALL AND MEDIUM ENTERPRI SES .......................................................................13
1. SMALL AND MEDIUM ENTERPRISES INDUSTRIAL DEVELOPMENT
INITIATIVE..................................................................................................................... ...13
2. ARTE/SME PROGRAMME .............................................................................................15
IV. REGIONAL SU BSIDIES...................................................................................................16
1. REGIONAL ECONOMIC INCENTIVES SCHEME.....................................................16G/SCM/N/48/EEC/Add.13
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CENTRAL ADMINISTRATION
I. FISHERIES
1. 1998 BUDGET – CO-FINANCED PART OF NATIONAL AID
Pursuant to Regulation 3699/93 setting out the criteria and conditions for the Community's
structural measures in fisheries, aquaculture and the processing and marketing of the products thereof,IFOP (Royal Decree 798/1995 of 19 May), the fo llowing aid has been granted (in millions of
Pesetas):
Individual compensatory premiums – 85.45 million.  Transferred to the Autonomous Communities.
Subsidies for the improvement of fishing – 102.34 million.  Contributions received from the European
Social Fund.Promotion of aquaculture – 210 million.  Transferred to the Autonomous Communities.
Marine cultivation plans – 89.84 million.  Transferred to the Autonomous Communities.
Reorganization and renovation of the fishing fleet
- Building – 24.772 million- Modernization – 1.658 million- Definitive stoppage – 494.04 million- Definitive stoppage in the Basque Country –
- Transfers to Autonomous Communities – 4,821.41 million
- Temporary stoppage – 836 million (under this heading, 84.6 million were also transferred to
the General Treasury of Social Security for the readjustment that took place during the
financial year 1997).
Conversion of the fishing fleet
- Temporary business associations – 340.27 million- Establishment of joint ventures –1,159.03 million
Compensatory earlier retirement as a result of the reorganization of the fishing fleet –
47.21 million transferred to the Autonomous Communities.
2. AID TO SHIPOWNERS AFFECTED BY THE STOPPAGE OF FISHING
1. Title of the programme
Special economic aid to shipowners affected by the stoppage of fishing
2. Period covered by the notification
Financial year 1998G/SCM/N/48/EEC/Add.13
Page 4
3. Policy objective and/or purpose of the subsidy
In accordance with Article 14 of Council Regulation 3699/93, amended on 3 November 1998
by new Council Regulation 2468/98, Royal Decree 798/1995 was prepared on 19 May.  Pursuant to
Article 61 of that Royal Decree, assistance is provided for the temporary cessation of the activities offishing fleets caused by unforeseen and non-repetitive events, and the requisite aid is granted to
owners of fishing vessels fishing for cephalopods a nd trawling for black hake in the Moroccan fishing
grounds, under the fishing agreement between the European Union and the Kingdom of Morocco, on
account of the biological cessation of fishing during March and April 1998.
4. Authority
Order of 3 April 1998 (BOE, 8 April)
5. Form of the subsidy
Non-repayable subsidies
6. To whom and how the subsidy is provided
Shipowners in the fishing sector, through the collaborating entities.
A variable amount is granted depending on the gross registered tonnage (GRT) or gross
tonnage (GT), in accordance with table 2 of Royal Decree 696/1996 of 26 April.
7. Subsidy per unit or total amount of the subsidy
Aid to ship owners Number of vessels
Ptas 751.43 million  103
8. Duration of the subsidy
From 1 March to 30 April 1998
9. Statistical data permitting an assessment of the trade effect of the subsidy
No effect on trade.
II. INDUSTRY AND ENERGY
1. PROMOTION OF THE ECONOMIC AND SOCIAL SECTORS OF THE AGRI-
FOOD INDUSTRY
1. Title of the subsidy programme
Promotion of the economic and social sectors of the agri-food industry.
2. Period covered by the notification
1998G/SCM/N/48/EEC/Add.13
Page 5
3. Policy objective and/or purpose of the subsidy
To promote the implementation of the technical assistance and management plans for the
economic and social sectors of the agri-food industry.
4. Authority
Order of 4 July 1995 establishing subsidies for technical assistance and management plans for
the agri-food industries.
5. Form of subsidy
Non-repayable grant
6. Recipients/beneficiaries
Associations of firms in the industrial agri-food sector, associations of agricultural producers,
trade unions in the agri-food industry, professiona l associations, foundations and other organizations
whose objectives are connected with the agricultural and food industry.
7. Amount of the subsidy
Total amount for 1998:  75,744,737 Pesetas
8. Duration of the subsidy
Specific, when the requirements are fulfilled.
9. Statistical data permitting an assessment of the trade effects of the subsidy
No information is available to permit such an assessment, but the effect would appear to be
minimal in any case.
2. MINING (OTHER THAN ENERGY)
1. Title of the subsidy programme
Development of non-energy mining
2. Period covered by the notification
1998
3. Purpose of the subsidy
Development of the non-energy mining sub-sect or, ore prospecting, mining and processing,
as well as R&D in these fields and, in some cases, environmental rehabilitation of former mining
sites.
4. Authority
Ministerial Order of 8 April 1997 (BOE, 24 April 1997)G/SCM/N/48/EEC/Add.13
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5. Form of the subsidy
Non-repayable subsidy
6. To whom and how the subsidy is provided
Enterprises, associations of enterprises or institutions whose object is to promote and develop
the use of non-energy mineral raw materials are eligible for the subsidy.
Mining investment subsidies are confined to zones defined by the EU Commission as
Objective 1, since the assistance under this programme in this case is for regional development.
This aid is contingent on the applicants' meeting their tax and social security obligations, and
the recipients must produce documents showing th at the subsidized activity has been carried out.
7. Amount of the subsidy
Ptas 309 million
The maximum aid is 20 per cent of subsidizable investment.
8. Duration of the subsidy
The programme lasts for five years, until 31 December 2001.
9. Statistical data on the trade effects of the subsidy
The programme has no trade effects because of the small amount compared with the size of
the sector (annual turnover between Ptas 200,000 million and Ptas 300,000 million) and the high
number of recipients, since the programme covers 54 enterprises.
3. ENERGY SAVING AND EFFICIENCY PLAN
1. Title of the subsidy programme
Energy Saving and Efficiency Plan
2. Period covered by the notification
1998
3. Purpose of the subsidy
The Plan's objectives are to promote energy efficiency in industry, transport and public
buildings;  to develop the use of renewable energy sources, such as wind, solar (thermal andphotovoltaic energy), use of the biomass and waste (urban, industrial, forest and agricultural) and
small-scale hydraulic power (up to 10 MVA).
This is done in accordance with the objectives of Law 82/80 on energy conservation and of
the National Energy Plan, which defines the energy objectives for the decade 1991-2000.G/SCM/N/48/EEC/Add.13
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4. Authority
Law 82/80 on energy conservation and Ministerial Order of 6 February 1997 establishing the
regulatory bases for subsidies under this programme for the period 1997-1999 and setting the
subsidies for 1997.
5. Form of the subsidy
Non-repayable subsidy
6. To whom and how the subsidy is provided
The following are eligible for such subsidies:
- Public or private enterprises;- groups of such enterprises;
- condominium owners' associations;
- non-profit making institutions;- local corporations;- natural persons engaging in activities covered by the Plan.- neighbourhood associations and groups of such associations which submit integrated
programmes for the supply of services to a minimum of 150 housing units.
To receive this subsidy, the beneficiary must show that he has met his current tax and social
security obligations and that the subsidized activity has been carried out.
7. Amount of the subsidy
For the 1998 financial year, subsidies under this programme amounted to Ptas 1,852 million.
8. Duration of the subsidy
This programme covers the period 1997-1999.
9. Statistical data on the trade effects of the subsidy
Since the subsidy is for all energy users, this question does not apply.
4. AID TO SHIPBUILDING
A. S
HIPBUILDING SUBSIDIES
A1. Title of the subsidy programme
Shipbuilding subsidiesG/SCM/N/48/EEC/Add.13
Page 8
A2. Period covered by the notification
1998
A3. Purpose of the subsidy
The fundamental aim of Community and national policy is to ensure that the shipbuilding
sector remains competitive on the world market.
Since third countries continue to apply aid and/or measures that distort free competition in the
shipbuilding sector, in order to compete on the in ternational market Community shipyards must have
access to operational aid (limited by a common ceiling:  9 per cent or 4.5 per cent, depending onwhether or not the value of the ship to be built exceeds ECU 10 million) and restructuring aid (for
investments which do not imply an increase in capacity, total or partial closure of facilities and
research and development).
A4. Authority
Royal Decree 442/1994, of 11 March, on shipbu ilding subsidies and financing, amended by
Royal Decrees 1395/1995 and 1562/1997.
A5. Form of the subsidy
Non-repayable subsidy
A6. To whom and how the subsidy is provided
The subsidy is paid to shipyards building metal-hull vessels of over 100 gross registered
tonnes with the exception of fishing vessels since 19 October 1997.
The subsidy is provided once the relevant construction or conversion contract has come into
effect.  Payments are made as the ship is built or converted, subject to provision being made in the
annual budget, which means an average delay in paym ents of approximately six months to one year.
A7. Amount of the subsidy
Total subsidy granted in 1998: Ptas 22,131 million
A8. Duration of the subsidy
The period of application of the programme is the same as that of the Seventh Directive,
which, in principle, extends up until the entry into force of the OECD Agreement and not later than
31 December 1998.
A9. Statistical data on the trade effects of the subsidy
The subsidies are granted under the Seventh Directive on aid to shipbuilding applicable in all
countries of the European Union.  Nevertheless, in 1997 shipbuilding in the European Union
represented 14.4 per cent of the global total, as opposed to 19.4 per cent in 1996, while at the sametime the shares of Japan and Korea rose from 36 per cent and 21.4 per cent respectively in 1996 to
39.1 per cent and 27.5 per cent in 1997.  Consequently, these subsidies have not increased the
European Union's share of the global market.G/SCM/N/48/EEC/Add.13
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B. INTEREST SUBSIDY FOR SHIPBUILDING LOANS
B1. Title of the subsidy programme
Interest subsidy for shipbuilding loans
B2. Period covered by the notification
1998
B3. Purpose of the subsidy
The same objectives as those described in section 3 above.
B4. Authority
Royal Decree 442/1994, of 11 March, on shipbu ilding subsidies and financing, amended by
Royal Decrees 1395/1995 and 1562/1997.
B5. Form of the subsidy
Interest subsidy
B6. To whom and how the subsidy is provided
Domestic shipbuilders or those domiciled in the European Economic Area and, since
19 October 1997, under certain conditions, shipbuilders domiciled outside the European Economic
Area are eligible for this subsidy.  It consists of payment of up to 3 percentage points of the interest on
shipbuilding loans granted by domestic or foreign financial entities.
The subsidy is paid throughout the term of the loan (8.5 to 14 years) subject to provision
being made in the annual budget, which means that there is a three to nine months' delay in payments.
B7. Amount of the subsidy
Total subsidy granted in 1998: Ptas 6,182 million
B8. Duration of the subsidy
The period of application of the programme is the same as that of the Seventh Directive,
which, in principle, extends up until the entry into force of the OECD Agreement and not later than31 December 1998.
B9. Statistical data on the trade effects of the subsidy
The comments made in A.9 also apply to this  section as the subsidy under the interest rate
subsidy is deducted from the common maximum ceiling, 9 per cent or 4.5 per cent depending on
whether or not the value of the vessel to be built exceeds ECU 10 million.G/SCM/N/48/EEC/Add.13
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5. SUPPORT INITIATIVE FOR TECHNOLOGY, QUALITY AND INDUSTRIAL 
SAFETY (ATYCA)
1. Title of the subsidy programme
Support Initiative for Technology, Quality and Industrial Safety (ATYCA)
2. Period covered by the notification
1998
3. Purpose of the subsidy
The basic objective of the ATYCA initiative is to enhance the technological and innovative
capacity, as well as the safety and industrial quality, of Spanish enterprises in conformity with the
European Union's policy on aid for technological research and development, and the incorporation of
quality and safety in industrial processes.
The ATYCA initiative consists of two main lines of action:  the Industrial technology
Development Programme (PFTI) and the Quality and Industrial Safety Programme (PCSI).
4. Authority
Aid under the ATYCA initiative is granted under the Order by the Ministry of Industry and
Energy of 25 April 1997 approving the regulatory bases and the budget for the 1997/1999 triennium
under this initiative (BOE, 6 May 1997).
5. Form of the subsidy
Non-repayable subsidy
6. To whom and how the subsidy is provided
Public or private enterprises and bodies, groups of such enterprises and non-profit-making
institutions are eligible.
The annual amount of ATYCA aid is available to potential beneficiaries which apply for
subsidies in order to carry out projects in various technological areas.  The aid is granted subject to the
study and assessment of the applications by a committee.  The amount of the subsidy in relation to the
costs of projects may not exceed the limits of State aid authorized under European Union directives.
The aid is contingent on compliance by applicants with their tax and social security
obligations and proof that the activity has actually been carried out.
7. Annual amount of the subsidy
In 1998 subsidies paid under the ATYCA initiative amounted to Ptas 19,926 million.
8. Duration of the subsidy
The ATYCA initiative remains in force from 1997 to 1999 and the subsidies are granted
annually.G/SCM/N/48/EEC/Add.13
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9. Statistical data on the trade effects of the subsidy
Because of the nature of this programme, which mainly concerns the development of
technology and industrial quality and is open to enterprises in all industrial sectors, including
building, the trade effects are minimal since the aid is distributed over virtually the whole of industry.
Additional note
The majority of the subsidies granted under the ATYCA initiative are used to support R&D
projects under the Industrial Technology Development Programme;  consequently, the subsidies
under this Programme are non-actionable subsidies under Article 8.2 of the SCM Agreement, notified
pursuant to Article 25 as granted in 1997.
6. AID UNDER TECHNOLOGICAL PROGRAMMES CONNECTED WITH THE SEAT
MODERNIZATION PLAN
1. Title of the subsidy programme
Aid under technological programmes connected with the SEAT Modernization Plan
(1994-1997)
2. Period covered by the notification
1998
3. Purpose of the subsidy
The aid is intended for innovation, technological development and training projects in the
SEAT company, a subsidiary of the Volkswagen Group, under a plan that will mean a 29 per centreduction in SEAT's capacity and a 5 per cent capacity reduction of the VW Group, at the Community
level.
4. Authority
Commission Decision 96/257/EC of 31 October 1995 concerning the aid granted by Spain to
SEAT S.A., a member of the VW Group.
5. Form of the subsidy
Non-repayable subsidy
6. To whom and how the subsidy is provided
The subsidy is payable exclusively to the SEAT company, which must produce evidence to
the Spanish authorities that the innovation, technological development and training projects have been
implemented.
7. Amount of the subsidy
The amount in 1998 was Ptas 3,715 million.G/SCM/N/48/EEC/Add.13
Page 12
8. Duration of the subsidy
The Modernization Plan covers the period 1994-1997 and subsidies may be granted in the
years 1995-1998.
9. Statistical data on the trade effects of the subsidy
The subsidy has no adverse affects on trade for SEAT's competitors since it fulfils the
requirements under the Agreement on Subsidies and Countervailing Measures for aid for this purpose
(R&D, Article 8.2(a));  furthermore, the Modernizat ion Plan for which the aid is intended involves
reduction of 29 per cent in production capacity and of 49 per cent in employment by the end of the
Plan, so that by the end of 1997 SEAT's technical capacity will not exceed 2,125 units per day,compared with 3,000 units per day at the end of 1993.
7. R&D PLAN FOR THE AERONAUTICAL SECTOR
1. Title of the subsidy programme
R&D plan for the aeronautical sector
2. Period covered by the notification
1998
3. Purpose of the subsidy
Basic research and development projects in the aeronautical sector
4. Authority
Decision of the Government Commission for Economic Affairs and Cooperation Agreements
with enterprises.
5. Form of the subsidy
Repayable advances
6. To whom and how the subsidy is provided
Aircraft companies which have signed a Cooperation Agreement.  The repayable advances
are paid out annually.
7. Amount of the subsidy
Ptas 4,234 million
8. Duration of the subsidy
It is a five-year R&D plan and ends on 31 December 1998.G/SCM/N/48/EEC/Add.13
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9. Statistical data on the trade effects of the subsidy
Since the Programme covers basic industrial research, which is far removed from the
marketing stage, it has no trade effects.
Additional note
The Plan is for basic research projects and is therefore regarded as a programme of "non-
actionable" aid within the meaning of Article 8.2(a) of the SCM Agreement.  It is notified under
Article 25, having been in force in 1996.
III. SMALL AND MEDIUM ENTERPRISES
1. SMALL AND MEDIUM ENTERPRISES INDUSTRIAL DEVELOPMENT
INITIATIVE
1. Title of the subsidy programme
Small and Medium Enterprises Industrial Development Initiative:  aid and promotion
2. Period covered by the notification
1998
3. Purpose of the subsidy
The SMEs Industrial Development Initiative incorporates a number of activities for small and
medium enterprises (SMEs) and includes the following sub-programmes:
3.1 Business cooperation
Purpose: The official aid is intended to finance some of the cost for national partners of
concluding cooperation agreements and the cost of cooperation awareness
and promotion plans.
The activities must not lead to restrictive business practices, must offer
guarantees of permanence and stability and must be directed at promotingand supporting inter-business cooperation.
3.2 Promotion of information services
Purpose: The aid is granted to facilitate cooperation among information centres which,
using telematics, promote and reinforce the supply of sophisticated business
information services.
3.3 Industrial design
Purpose: The implementation of design projects by companies to be used to
incorporate, include or apply innovative and/or design technology in SMEs
so as to provide information on the product, marketing, corporate identity,
and to disseminate, promote and make businesses and consumers aware of
the importance of design and innovation as tools for improving thecompetitiveness of businesses.G/SCM/N/48/EEC/Add.13
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3.4 Financing
Purpose: To facilitate access by small and medium enterprises to various sources of
financing, to assist investment, lower the cost, and improve the economic and
financial structure of such enterprises.
3.5 Networks of intermediate organizations supporting innovation
Purpose: Assistance to businesses for action plans or project start-up, principally those
intended to install mechanisms used for innovation management, utilize
technological resources or improve internal technology learning processes
within the business.
Spreading ideas, experience, practical improvements, results and techniques
involving innovation management, including joint training activities to
reinforce the human resources of SMEs and/or intermediate organizations.
Study and introduce commercial and technological monitoring systems in
appropriate sectors, to improve the formulation of technological and trade
plans and strategies by the SMEs.
Support for studies on the incorporation of innovation in the strategies of
intermediate organizations and their integration into supranational
organizations.
4. Authority
Royal Decree 937/1997 of 20 June 1997 (BOE, 11 July 1997)
5. Form of the subsidy
Non-repayable subsidy
6. To whom and how the subsidy is provided
Small and medium enterprises and intermediate organizations are eligible for this aid.
For the purposes of this Royal Decree, a small or medium industrial enterprise (SME) is
deemed to be an economic unit with natural or legal personality which, at the time of the application,meets the following requirements:
(a) Employs not more than 250 workers;(b) either:  an annual turnover of not more than ECU 40 million, or an overall balance of
not more than ECU 27 million;
(c) 25 per cent or more of their shares are not held by companies that do not meet the
aforesaid requirements, unless they are State investment enterprises, risk capital
enterprises or institutional investors, provided they do not exercise control.
For the purposes of this Royal Decree, an intermediate organization is deemed to be:- Any public, semi-public or private organization which, regardless of the way it is
established or whether it has legal personality, on a non-profit making and habitualG/SCM/N/48/EEC/Add.13
Page 15
basis, provides support services for small and medium enterprises by carrying out
joint assistance programmes or supplying services to promote and help improve the
management of SMEs.
- Organizations which, for profit-making purposes and in which the majority of the
capital is State owned, pursue the objectives set out in the previous paragraph.
- Financial bodies, excluding credit bodies, engaged in activities covered by the
financial support programmes in the Royal Decree, as well as bodies whose purpose
is to grant loans to SMEs and/or contribute towards the risk capital/capital
investment, either from their own resources or from resources managed by them.
Before receiving this subsidy, beneficiaries must  show that they have complied with their tax
and social security obligations.
They must also show that the subsidized activity has actually been carried out.
7. Amount of the subsidy
Ptas 7,956 million, allocated according to the te rritorial scope laid down in Article 153 of the
General Budget Law, as implemented by Law 13/ 1996 of 30 December on administrative tax and
social order measures.  There are commitments for a total of Ptas 7,359 million of the amount
allocated.
Breakdown of commitments by subprogramme:Business cooperation 16.04%
Business information 22.32%Design 22.13%
Innovation networks 32.78%
Financing   6.61%
8. Duration of the subsidy
The Programme is for three years until 31 December 1999.
9. Statistical data permitting an assessment of the trade effects of the subsidy
Given the nature of this aid programme, there is no effect on trade.
2. ARTE/SME PROGRAMME
1. Title of the subsidy programme
ARTE/SME Programme under the operational programme of the Community SME initiative.
2. Period covered by the notification
1998
3. Purpose of the subsidy
Aid for the financing of advanced telecommunication services projects of common interest to
small and medium enterprises.G/SCM/N/48/EEC/Add.13
Page 16
4.  Authority
Ministerial Order of 31 July 1995 (BOE, 21 August 1995).
5.  Form of the subsidy
Non-repayable subsidy
6. To whom the subsidy is provided
Only legally established non-profit-making public or private entities are eligible for the
subsidy.
Zones classified as Objective 1 under the European Regional Development Fund (ERDF) are
priority zones for action.
Action may also be undertaken in Objective 2 and 5-B zones, although to a lesser degree.
Some residual allocations go to non ERDF zones.
The aid is contingent on the applicants meeting their tax and social security obligations and
the recipients must produce documents showing that the subsidized activity has been carried out and
the relevant costs have been paid.
7. Amount of the subsidy
Subsidies approved in 1998:  Ptas 860 million
Around 70 per cent of this amount was used to acquire computer equipment (hardware and
software), to develop software as telecommunications terminals (modems, PCs) were purchased for
use by SMEs.  The remainder was used for communications costs and costs related to feasibility
studies,  promoting the use of advanced telecommunications services and providing technical
assistance.
8. Duration of the subsidy
The ARTE/SME programme is for five years and will remain in effect until June 1999 for the
submission of new projects.  Subsidized projects may be terminated after this date.
9. Statistical data permitting an assessment of the trade effects of the subsidy
The aid regime has no trade effects due to its small scale in comparison with the scale of trade
and the large number of SMEs that have indirectly benefited from this aid, estimated at 110,000 in
various economic sectors as the programme is multisectoral.
IV. REGIONAL SUBSIDIES
1. REGIONAL ECONOMIC INCENTIVES SCHEME
1. Title of the subsidy programme
Regional Economic Incentives SchemeG/SCM/N/48/EEC/Add.13
Page 17
2. Period covered by the notification
1998
3. Policy objective and/or purpose of the programme
The purpose  is to promote the economic development of the most disadvantaged areas.  The
objective of regional incentives is to foster entrepreneurship and encourage firms to locate in
previously determined areas, so as to reduce economic disparities on Spanish territory, secure a more
equitable spread of economic activities and strengthen the regions' potential for internally generated
development.
4. Authority
The mandate under the Spanish Constitution, which sets out in Article 40.1 an obligation on
the authorities to foster favourable conditions for a more equitable distribution of regional income.
Similarly, Article 138 lays down that the State shall establish a suitable and fair economic balance
among the various parts of Spanish territory.
The legislative basis is:
- Law 50/85 of 27 December, on regional economic incentives to remedy inter-regional
economic imbalances.
- Regulation approved by Royal Decree 1535/1987 of 11 December and amended by
Royal Decree 897/1991 of 14 July, Roya l Decree 302/1993 of 26 February, Royal
Decree 2315/1993 of 29 December and Royal Decree 78/1997 of 24 January.  It was
approved by the EU Commission's Decision of 1 June 1987.
- 13 Royal Decrees delimiting the Economic Promotion Areas, some amended.
5. Form of the subsidy
Non-repayable subsidies, granted for productive investments and calculated on the investment
approved by the Administration.
6. To whom the subsidy is provided
Once it is approved, the subsidy is notified individually to the persons concerned in an
Individual Resolution establishing the basic data for the project, including the name of the recipiententerprise that has applied for it.
The aid is paid once the relevant Autonomous Community has issued a report substantiating
full execution of the project and on fulfilment, within the specified periods, of the conditions required
in the relevant Individual Resolution, accepted by the beneficiary beforehand.  Enterprises may applyto receive the subsidy in instalments provided th ey produce evidence that the part of the investment
for each instalment has been made together with adequate guarantees against failure to complete.
7. Amount of the subsidy
General State Budget for 1998:  Ptas 15,413 million.G/SCM/N/48/EEC/Add.13
Page 18
8. Duration of the subsidy
The scheme will continue as long as the reason for introducing it, namely the imbalance in
regional development, persists.
9. Statistical data permitting an assessment of the trade effects of the subsidy
As to the statistical data permitting an assessm ent of the programme's trade effects, it should
be noted that, since the subsidies take the form of capital for productive investment in disadvantaged
regions, the principle of free competition is not deemed to be jeopardized.
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