Industrial subsidies
Industrial Subsidies
Within the EAEU, an industrial subsidy means:
1) financial contribution to individuals and legal entities, in the result of which benefits are created and which is carried out by:
– direct transfer of monetary funds (e.g., in the form of irrevocable loans and loans); acquisition of share in the charter capital, or its increase, or an obligation to transfer such funds (e.g., loan guarantees);
– full or partial waiver of collection of funds, which would have to flow into the income of a member State (e.g. tax exemptions, debt relief);
– provision of industrial goods or services;
– purchase of industrial goods.
2) any other form of income or price support which operates to reduce the import of industrial goods from the territory of any member State or to increase the export of industrial goods to the territory of any member State.
Presently, the territories of the EAEU member States enforce the Common Rules for Granting Industrial Subsidies with regard to industrial goods, including during rendering or receiving services that are directly associated with the production, sale and consumption of industrial goods.
The rules for the provision of industrial subsidies, industrial goods, and other subsidy types are determined by Annex 28 to the EAEU Treaty.
The following subsidies are prohibited within the EAEU:
– export subsidies – subsidies contingent upon export performance from the territory of a member State granting the subsidy to the territory of another member State;
– replacement subsidies – subsidies contingent upon the use of industrial product which originated from the territory of member State granting the subsidy.
In accordance with the EAEU Treaty, the member States annually provide each other with notifications of planned and provided industrial subsidies.
The practical importance of providing notifications, in addition to fulfilling obligations, pertains to the availability of information on all measures of support provided to small, medium and big businesses in other EAEU member States.