G/SCM/N/25/EEC
Page275
GERMANY
TABLE OFCONTENTS
Page
1. Interest-rate grants tofinance orders toGerman shipyards ("Werfthilfen") .......276
2. Competition aidforGerman shipyards ("Wettbewerbshilfe") ................278
3. Bavarian programme insupport ofthetourism industry (aspromulgated ........280
bytheBavarian Ministry ofState ofEconomics, Transport andTechnology
on29March 1995)
4. Bavarian regional programmes insupport ofcommerce andindustry ...........281
(Bayerische Förder-programme fürdiegewerbliche Wirtschaft) aspromulgated
bytheBavarian Ministry ofState ofEconomics, Transport andTechnology,
5July1994
5. Saleatreduced prices ofland-owned realestate, either builtupornot, .........282
forbeing usedascommercial sites(Berlin)
6. Reduction ofbetween 3and5%oftheratespayable oninheritable land-use ......283
rights inthecaseofprojects, worthy ofspecial promotion, ofmanufacturing
firms depending onthedegree ofuseofthebuildings (Berlin)
7. Consolidation programme oftheLand (Mecklenburg-Vorpommern) ...........284
8. Subsidy tolaunch financing andfundtheconstruction ofamechanical-engineering ..285
usercentre byDaimler Benz Aerospace (DASA) inBerlin
9. Joint Scheme on"Improving theRegional Economic Structure" ..............286
10. Investment allowance forcompanies inthemanufacturing andcraftsectors .......288
ineastern Germany where themajority holding isineastern German hands
(Section 5,para. 2ofthe1996 Investment Allowance Act)
11. Investment allowance forsmall andmedium-sized companies (upto...........289
250employees) inthemanufacturing andcraftsectors ineastern Germany
(Section 5,para. 3ofthe1996 Investment Allowance Act)
12. AdHocAidasaspecial investment grant ofLand Saxony-Anhalt .............289
13. Regional economic support programme (North Rhine Westphalia) .............290
14. Promotion ofefficient useofenergy; programme section: "promotion of.......291
technological development" (North Rhine Westphalia)G/SCM/N/25/EEC
Page276
1. Interest-Rate Grants toFinance Orders toGermany Shipyards ("Werfthilfen")
1. Member State
Federal Republic ofGermany.
2. Name ofthesubsidy scheme oradhocsubsidy
Interest-rate grants tofinance orders toGerman shipyards ("Werfthilfen").
3. Form ofthesubsidy
Grant.
4. Subsidy perunit
Total amount ofassistance provided in1996:
- Support approved: DM488million
Average levelofsupport pership:
- From support approved in1996: DM8.1million.
5. Objective and/or purpose ofthesubsidy
Theeighth shipyard assistance programme (VIII. Werfthilfeprogramm) exists toprovide
non-repayable interest-rate grants under therelevant OECD agreement regarding export credits for
ships andtherelevant EUdirectives onshipbuilding subsidies.
Legal basis: Commitment authorizations intheFederal budget Guidelines fromthe
Federal Ministry ofEconomics.
Modes ofpayment: Those receiving thegrants areshipbuilding companies intheFederal
Republic ofGermany.
Support isgiven totheconstruction andreconstruction ofhigh-
technology marine vessels (merchant vessels), respecting theOECD
minimum conditions.
- 81/2yearterm
- 20%advance payment
- Minimum interest rateof8%p.a.
Inaddition, grants canbegiven forloans atconditions morefavourable
thanthosedescribedaboveifthisappearsjustified,particularlyinterms
ofdevelopment policy.G/SCM/N/25/EEC
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Thesupport serves tolessen thecostofloans totheclients ofGerman shipyards, thusachieving
apartial adjustment towards theinternational market conditions. Theassistance ismade available in
theform oftranches intheeighth shipyard assistance programme.
6. Duration ofsubsidy andother time-limits attached toit
Currently: - 8thtranche (forWestern German shipyards) fordelivery years
1993-1998 withsupport totalling DM641.5 million;
- 8thtranche (forEastern German shipyards) fordelivery years 1991-
1998 withsupport totalling DM471.0 million;
- 9thtranche (forWestern German shipyards) fordelivery years 1996-
1998 withsupport totalling DM350.0 million.
7. Statistical datapermitting anassessment ofthetrade effects ofasubsidy
Figures inDMmillion
1992 1993 1994 1995 1996
Production 4,178 4,863 4,686 5,282 5,361
Imports from outside EU 305 477 333 155* 67*
Exports tooutside EU 2,929 3,018 2,411 1,360* 1,152*
*Figures for10monthsG/SCM/N/25/EEC
Page278
2. Competition AidforGerman Shipyards ("Wettbewerbshilfe)
1. Member State
Federal Republic ofGermany.
2. Name ofthesubsidy scheme oradhocsubsidy
Competition aidforGerman shipyards (Wettbewerbshilfe).
3. Form ofthesubsidy
Grant.
4. Subsidy perunit
Total amount ofassistance provided in1996:
- Support approved: DM229million.
Average levelofsupport pership:
- From support approved in1996: DM2.3million.
5. Objective and/or purpose ofthesubsidy
Theassistance isintended tofacilitate therestructuring being undertaken bytheshipyards.
Grants towards production costsaregiven, where theyarepermissible under therelevant EUshipyard
subsidies directive.
Theprogramme isfunded jointly bytheFederal andtheLänder Governments.
Legal basis: Commitment authorizations intheFederal andLänder budgets
Guidelines from theFederal Ministry ofEconomics.
Modes ofpayment: Those receiving thegrants areshipbuilding companies intheFederal
Republic ofGermany.
Support isgiven totheconstruction andconversion ofhigh-technology
marine vessels (merchant vessels). From 1January 1994, thesupport
rateis7%oftheprice inthecontract; forships withacontract price
ofbelow ECU 10million andforconversion work, therateis4.7%.G/SCM/N/25/EEC
Page279
6. Duration ofsubsidy andother time-limits attached toit
Theassistance hasbeenprovided overthefollowing period andtothefollowing extent:
Foracquisition years:
1987-1990 (Western German shipyards) DM1,000 million
1991-1992 (Western German shipyards) DM 538million
upto1993 (Eastern German shipyards) DM 803million
1993-1994 (Western German shipyards) DM 166million
1994-1996 (Western German shipyards) DM 291million
1995-1996 (allGerman shipyards) DM 580million
Fororders given aftertheOECD Agreement hascome intoforce, nofurther assistance can
begranted.
7. Statistical datapermitting anassessment ofthetrade effects ofasubsidy
Figures inDMmillion
1992 1993 1994 1995 1996
Production 4,178 4,863 4,686 5,282 5,361
Imports from outside EU 305 477 333 155** 67**
Exports tooutside EU 2,929 3,018 2,411 1,360** 1,152**
**Figures for10monthsG/SCM/N/25/EEC
Page280
3. Bavarian Programme inSupport oftheTourism Indusry
1. Member State
Federal Republic ofGermany.
Responsible levelofgovernment: FreeState ofBavaria.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Bavarianprogrammeinsupportofthetourismindustry(aspromulgatedbytheBavarianMinistry
ofState ofEconomics, Transport andTechnology on29March 1995).
3. Form ofthesubsidy
- investment grant;
- Loan.
4. Total 1996 amount ofsubsidy
- investment grants: DM28.5million;
- loans: DM65.7million;
- assisted volume ofinvestments: DM306.7 million;
- number ofassisted companies: 273.
5. Policy objective and/or purpose ofthesubsidy
Aidtofinance investments inthetourism industry inassisted areas.
Objective: - improving thesupply oftourism services;
- increasing theeconomic strength ofstructurally weak areas.
6. Duration ofthesubsidy
Indefinite.
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Notavailable.
OutsidetheassistedareaspursuanttotheJointFederal/LandSchemeon"ImprovingtheRegional
Economic Structure", support isrestricted tosmall andmedium-sized enterprises (SMEs) within the
meaning oftheCommunity Framework onState AidtoSmall andMedium-Sized Enterprises.G/SCM/N/25/EEC
Page281
4. Bavarian Regional Programmes inSupport ofCommerce andIndustry
1. Member State
Federal Republic ofGermany.
Responsible levelofadministration: FreeState ofBavaria.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Bavarian regional programmes insupport ofcommerce andindustry (Bayerische
Förderprogramme fürdiegewerbliche Wirtschaft) aspromulgated bytheBavarian Ministry ofState
ofEconomics, Transport andTechnology, 5July1994.
3. Form ofthesubsidy
- investment grant;
- loan.
4. Total 1996 amount ofsubsidy
- investment grants: DM86.6million;
- loans: c.DM201.3 million;
- assisted volume ofinvestments: DM811.6 million;
- number ofassisted companies: 152.
5. Policy objective and/or purpose ofthesubsidy
Aidtofinance investments incommerce andindustry tocreate andsecure jobsandtraining
places inassisted areas.
Objective: - Improving theregional economic structure;
- Increasing theeconomic strength ofstructurally weak areas.
6. Duration ofthesubsidy
Indefinite; review tobemade before end-1999.
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Notavailable.
OutsidetheassistedareaspursuanttotheJointFederal/LandSchemeon"ImprovingtheRegional
Economic Structure", support isrestricted tosmall andmedium-sized enterprises (SMEs) within the
meaning oftheCommunity Framework onState AidtoSmall- andMedium-Sized Enterprises.G/SCM/N/25/EEC
Page282
5. SaleatReduced Prices ofLand-Owned RealEstate
1. Member State
Federal Republic ofGermany; Land Berlin.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Saleatreduced prices ofland-owned realestate, either builtupornot,forbeing usedas
commercial sites.
3. Form ofthesubsidy (i.e.grant, loan, taxconcession, etc.)
Reducing landacquisition costs bya25%rebate from thecurrent value oftheland.
4. Subsidy perunitor,where thisisnotpossible, thetotalamount oftheannual amount budgeted
forthesubsidy
Annual amount (1996): DM4,189,815.00.
5. Policy objective and/or purpose ofthesubsidy
Reducing landacquisition costs tomanufacturing forregional promotion purposes.
6. Duration ofthesubsidy and/or anyother time-limits attached toit
Programme deadline: 31December 1997.
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Notavailable.G/SCM/N/25/EEC
Page283
6. Reduction ofRates Payable onInheritable Land-Use Rights
1. Member State
Federal Republic ofGermany; Land Berlin.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Reduction ofbetween 3%and5%oftheratespayable oninheritable land-use rights inthe
caseofprojects, worthy ofspecial promotion, ofmanufacturing firms depending onthedegree ofuse
ofthebuildings.
3. Form ofthesubsidy (i.e.grant, loan, taxconcession, etc.)
Cutting landcosts bygranting areduced rateonland-use rights.
4. Subsidy perunitor,where thisisnotpossible, thetotalamount oftheannual amount budgeted
forthesubsidy
1996 payments: DM1,123,969.00.
5. Policy objective and/or purpose ofthesubsidy
Reducing landacquisition costs tomanufacturing forregional promotion purposes.
6. Duration ofthesubsidy and/or anyother time-limits attached toit
Unlimited
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
WTO-scale effects ofthesubsidy notmeasurable because ofthelimited funding ofthe
programme.G/SCM/N/25/EEC
Page284
7. Consolidation Programme oftheLand
1. Member State
Federal Republic ofGermany; Land Mecklenburg-Vorpommern.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Consolidation programme oftheLand.
3. Form ofthesubsidy (i.e.grant, loan, taxconcession, etc.)
Loans ofuptoDM5million atmarket conditions, asarulerestricted tosmall andmedium-sized
enterprises within themeaning oftheCommunity Framework onStateAidtoSmall andMedium-Sized
Enterprises.
4. Subsidy perunitor,where thisisnotpossible, thetotalamount oftheannual amount budgeted
forthesubsidy
Approved loans in1996: DM63,564 million (39enterprises)
Disbursed in1996: DM51,988 million (35enterprises)
5. Policy objective and/or purpose ofthesubsidy
Liquidity aidforenterprises ofregional importance.
6. Duration ofthesubsidy and/or other time-limits attached toit
Theprogramme hascome intoforce 1June1995.
Duration ofloans is10years.
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Noassessment ismade ofstatistics ontradeeffects. Most ofthesupported enterprises operate
onregional markets only.G/SCM/N/25/EEC
Page285
8. Subsidy tolaunch finance andfund theconstruction ofaMechanical-Engineering User
Centre byDaimler-Benz Aerospace (DASA)
1. Member State
Federal Republic ofGermany; Land Berlin.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Subsidy tolaunch finance andfundtheconstruction ofamechanical-engineering usercentre
byDaimler-Benz Aerospace (DASA) inBerlin.
3. Form ofthesubsidy (i.e.grant, loan, taxconcession, etc.)
General grant tolaunch finance andfundtheconstruction ofamechanical-engineering user
centre aswellasproject-related promotion (DM6million) fordeveloping especially usertechnologies.
Thetotal subsidy ofDM12million accounts forabout 27% oftheoutlays ofabout
DM43.7million estimated forconstruction oftheusercentre.
4. Subsidy perunitor,where thisisnotpossible, thetotalamount oftheannual amount budgeted
forthesubsidy
In1996 atotalofDM2,478,283.00 wasdisbursed.
5. Policy objective and/or purpose ofthesubsidy
Thetaskofthemechanical-engineeringusercentreistodevelopsoftwareforfreelyprogrammable
control systems. Thisincludes interaliasoftware forprocessing, diagnosing, process reduction, user-
surface, machine interface (CAD/CAM) technologies andinternetting.
Theusercentre 'sactivities aretoresult innewproducts, newprocesses awellasproduction
structures inthefields ofelectronics, information technology, communications technology aswellas
system control technology inorder toadapt tochanges intechnological andmarket conditions.
Thesubsidy isaimed atexpanding scientific andtechnological knowledge atthelevelofresearch
establishments andbusiness and,thus, atincreasing theinnovative strength especially ofBerlin
mechanical engineering andcontrol-systems manufacturing companies facing difficulties intheprocess
ofrestructuring.
Against thisbackground, theusercentre concept provides forcooperation withresearch
institutions, machine toolproducers andtheir(mainly small andmedium-sized) subsuppliers aswell
asendusers. Thepartners aretopooltheirknow-how andtodevelop itinamanner thatitissuitable
forbeing usedinproduction. Theresults ofsuchcooperation willbeavailable notonlytothepartners
inthescheme, butalsotoother users upon request.
6. Duration ofthesubsidy and/or anyother time-limits attached toit
Thesubsidy totheconstruction oftheusercentre covers theperiod 1994/1996.G/SCM/N/25/EEC
Page286
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Theeffects ontrade ofthesubsidy granted isnotmeasurable -atleastnotonaninternational
scale. Pertinent statistical dataarenotavailable.
9. Joint Scheme on"Improving theRegional Economic Structure"
1. Member State
Federal Republic ofGermany.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Joint Scheme on"Improving theRegional Economic Structure".
3. Form ofthesubsidy (i.e.grant, loan, taxconcession, etc.)
Regional assistance intheformofinvestment grants tocommerce andindustry. Thepurpose
ofpromotion under theJointScheme isaselective regional strengthening ofLand economic promotion
programmes inthefields ofadvice, schooling, human capital formation aswellasresearch and
development; thisallows greater precision intheuseoffunds.
Thisregional assitance consists ofsubsidies within themeaning ofletter (b)ofArticle 8.2of
theSCM Agreement andmeets therequirements ofnumbers (i)to(iii)ofletter (b)ofArticle 8.2.
Paragraph 3ofArticle 72oftheBasic Lawrequires living conditions tobeequal throughout
theFederal territory. Regional structural policy contributes tothisend. According toparagraph 1
ofArticle 91aoftheBasic Law, itisthecommon taskoftheFederal andtheLand Governments to
improve theregional economic structure. Thebasis ofpromotion istheActontheJointScheme on
"Improving theRegional Economic Structure", dated 6October 1969.
4. Annual amount budgeted forthesubsidy
Inthe1996budgets oftheFederal andLand Governments anamount ofDM4.16billion was
earmarked forcommerce andindustry. Thisamount maybebroken down byDM406million for
theoriginal federal laender andDM3,754 million forthenewfederal laender.
5. Policy objective and/or purpose ofthesubsidy
Theprimary regional objective istoenable structurally weak regions tokeeppacewithgeneral
economic development byoffsetting locational disadvantages andreducing regional development
differentials. Regional structural policy focuses onsupporting regional development activity witha
viewtoraising thelevels ofemployment andincome inproblem areasinthisway. Eligible forsubsidies
under thisscheme arecommercial andindustrial firms.
Investment incommerce andindustry areeligible forpromotion iftheygenerate additional
income totheregion sothattheregion 'stotallevelofincome israised toanotinsignificant extent
inthelongrun(primary effect). Thisisdeemed tobethecaseifthecompany applying forsubsidy
payment sellsthebetter partofitsproducts orservices onasupraregional basis. Theinvestment projects
concerned must create newjobsintheassisted areas orsecure existing ones.G/SCM/N/25/EEC
Page287
Assisted areas areredefined atmultiannual intervals onthebasis ofregional indicators (level
ofincome, unemployment, infastructure). Assisted areasintheoriginal laender including Berlin (West)
cover 22%oftheWest German population intheperiod from 1994 to1996. Thenewfederal states
andBerlin (East) represent assisted areas intheirentirety until1996. Moreover, theseareas havebeen
recognized asobjective-1 areas within theframework oftheEU-Structural Funds according to
paragraph 3(a)ofArticle 92oftheECTreaty untilend-1999.
6. Duration ofthesubsidy
Regional assistance consists ofanon-recurring payment andisgranted toinvestment projects
inassisted areas. Theprogramme isunder notimelimit.
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Regional promotion isaimed atoffsetting domestic locational investment disadvantages and
contributes toraising thelevels ofincome andemployment instructurally weakareas. Promotion under
theJoint Scheme therefore isneutral interms ofcompetition andhasnoeffect oncompetition in
international trade.G/SCM/N/25/EEC
Page288
10. Investment Allowance forCompanies intheManufacturing andCraft Sectors inEastern
Germany
1. Member State
Federal Republic ofGermany.
2. Name ofthesubsidy scheme oradhocsubsidy
Investment allowance forcompanies inthemanufacturing andcraftsectors ineastern Germany
where themajority holding isineastern German hands (Section 5para. 2ofthe1996 Investment
Allowance Act).
3. Form ofthesubsidy
Taxallowance ofupto20%foruptoDM1million ofinvestment.
4. Subsidy perunit
Themaximum amount under figure 3applies percompany andperyear; thesubsidies actually
received bytheindividual company units arenotknown.
Thetotalinvestment allowances disbursed in1996 isDM2,490 million.
5. Policy objective and/or purpose ofsubsidy
Toboost theability toinvest bypromoting theequity capital provision ofmanufacturing and
craftcompanies inthearea.
6. Duration ofsubsidy
Investment begun before 1January 1995, investment completed before 1January 1997.
7. Statistical datapermitting anassessment ofthetrade effects
Nosuchstatistical dataareavailable.
__________________*cf.Annex 1.G/SCM/N/25/EEC
Page289
11. Investment Allowance forSmall andMedium-Sized Companies intheManufacturing and
Craft Sectors inEastern Germany
1. Member State
Federal Republic ofGermany.
2. Name ofthesubsidy scheme oradhocsubsidy
Investment allowance forsmall andmedium-sized companies (upto250employees) inthe
manufacturing andcraftsectors ineastern Germany (Section 5paragraph 3ofthe1996 Investment
Allowance Act).
3. Form ofthesubsidy
Taxallowance ofupto10%foruptoDM5million ofinvestment.
4. Subsidy perunit
Themaximum amount under Figure 3applies percompany andperyear; thesubsidies actually
received bytheindividual company units arenotknown.
Thetotalinvestment allowances disbursed in1996 inDM2,490 million.
5. Policy objective and/or purpose ofsubsidy
Toboost theability toinvest bypromoting theequity capital provision ofsmall- andmedium-
sized manufacturing andcraftcompanies.
6. Duration ofsubsidy
Investment begun before 30June1994, investment completed before 1January 1999.
7. Statistical datapermitting anassessment ofthetrade effects
Nosuchstatistical dataareavailable.
12. AdHocasaSpecial Investment Grant ofLand Saxony-Anhalt
1. Member State
Federal Republic ofGermany.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Adhocsubsidy aidasaspecial investment grant ofLand Saxony-Anhalt.
3. Form ofthesubsidy (i.e.grant, loan, taxconcession, etc.)
GrantG/SCM/N/25/EEC
Page290
4. Subsidy perunitor,incases where thisisnotpossible, thetotalamount ortheannual amount
budgeted forthesubsidy
1994: DM100million
1995: DM100million
1996: DM40million.
5. Policy objective and/or purpose ofthesubsidy
Offsetting theextra costs arising formeeting mandatory German environmental andsafety
standards.
6. Duration ofthesubsidy and/or anyother time-limits attached toit
Three years.
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Notavailable.
13. Regional Economic Support Programme
1. Member State
Federal Republic ofGermany; Land North-Rhine/Westphalia.
2. Name ofthesubsidy scheme ortheadhocsubsidy
Regional economic support programme.
3. Form ofthesubsidy (i.e.grant, loan, taxconcession, etc.)
Grants towards investment projects oftrade andindustry andlocalinfrastructure.
4. Subsidy perunitor,where thisisnotpossible, thetotalamount oftheannual amount budgeted
forthesubsidy
Thetotalamount budgeted for1996; scheme oftheLand: DM49.8million.
5. Policy objective and/or purpose ofthesubsidy
Improving theregional economic structure andsupporting small- andmedium-sized businesses.
6. Duration ofthesubsidy and/or other time-limits attached toit
Notimelimit.
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Given theobjectives oftheprogramme, trade effects cannot beassessed.G/SCM/N/25/EEC
Page291
14. Promotion ofEfficient UseofEnergy
1. Member State
Federal Republic ofGermany -Land North-Rhine/Westphalia.
2. Name ofthesubsidy scheme oradhocsubsidy
Promotion ofefficient useofenergy: programme section "promotion oftechnological
development".
3. Form ofthesubsidy (i.e.grant, loan, taxconcession, etc.)
Support isgiven intheform ofgrants toberepaid under certain conditions.
4. Subsidy perunitor,where thisisnotpossible, thetotalamount oftheannual amount budgeted
forthesubsidy
Thetotalamount earmarked wasDM3.946 million (1996).
5. Policy objective and/or purpose ofsubsidy
Theprojectsinvolvetechnologicaldevelopmentsinthefieldofefficientenergyuseandrenewable
energy technologies toreduce theemission ofpollutants, especially CO2-emission andtoprotect
resources.
6. Duration ofsubsidy and/or other time-limits attached toit
Notime-limit.
7. Statistical datapermitting anassessment ofthetrade effects ofthesubsidy
Given theobjectives oftheprogramme, trade effects cannot beassessed.