G/SCM/N/3/EEC
Page 533
(e)Statistical data
The support is granted to a variety of projects and sectors, therefore it is not possible to present
statistical data permitting an assessment of trade effects.
(f)Legal bases
The legal provisions are laid down in the Governmental Ordinance (Förordningen om regionalpolitiskt
företagsstöd): SFS 1990:642.
(g)Rules and conditions
Natural or juridical persons operating in Sweden and public authorities adjusted to conditions on the
market. In some cases aid can also be granted to non-profit making associations.
The nature of the assisted projects can be investments in patent, licences, marketing activities,
development of new products, education, etc. The grant is awarded discretionary
according to the calculated need in each individual case, the size of the investments etc.
The firm must be profitable. Account should be taken of, if the development
measures promote an increase in employment. At least 40 per cent of the new jobs
created in each project must be reserved for each sex. Maximal aid intensity is 50 per
cent of the investment costs. Maximal amount is SKr 500,000. In special cases
concerning service companies the amount can be higher and the grant awarded without
direct link to hard investments. Development grant may be combined with other
forms of State grant on condition that the sum of the grant does not exceed the
maximal intensity for development grants.
6.4 Loans to Regional Investment Companies
(a)Form of subsidy
Loans. During the first years the interest rate may be lower than market rates, provided that the State
e.g. receives a share of the value added in the company after about ten years.
(b)Amount of subsidy
Total amount of granted loans in SKr millions: Fiscal year 1993/1994: 10
Support is granted to a variety of sectors and recipients and cannot be broken down per unit.
(c) Policy objective
The primary objective is regional aid to designated areas. The secondary objective is aid to SMEs in
designated areas. The main objective is to create new employment by stimulating
private capital to engage in certain businesses in the aid areas. The objective is also to
take advantage of management knowledge in order to promote the expansion of small
businesses.
(d)Duration
The programme commenced as from 1 July 1982. Duration formally decided on for every new fiscal
year.G/SCM/N/3/EEC
Page 534
(e)Statistical data
The support is granted to a variety of projects and sectors, therefore it is not possible to present
statistical data permitting an assessment of trade effects.
(f)Legal bases
The legal provisions are laid down in the Governmental Ordinance (Förordningen om regionalpolitiskt
företagsstöd): SFS 1990:642.
(g)Rules and conditions
Eligible are privately Swedish or foreign owned regional investment companies, working with viability in
competitive sectors on market conditions. Loans to regional investment companies
can only be awarded by the Government. The size of the loan is related to the capital
raised by the share holders. The regional loan usually amounts to twice the size of the
share capital. There is no other aid to investment companies.
6.5 Employment grants
(a)Form of subsidy
Grants.
(b)Amount of subsidy
Net cost in SKr millions: Fiscal year 1993/1994: 171
Support is granted to a variety of sectors and recipients and cannot be broken down per unit.
(c)Policy objective
The primary objective is regional aid to designated areas. The secondary objective is aid to SMEs and
employment in designated areas. In general the scheme is aimed at creation of new
employment by reducing the extra costs during the first years when taking on additional
labour.
(d)Duration
The programme commenced as from l July 1990. Duration formally decided on for every new fiscal
year.
(e)Statistical data
The support is granted to a variety of sectors and recipients, therefore it is not possible to present
statistical data permitting an assessment of trade effects.
(f)Legal bases
The legal provisions are laid down in the Governmental Ordinance (Förordningen om regionalpolitiskt
företagsstöd): SFS 1990:642.
(g)Rules and conditionsG/SCM/N/3/EEC
Page 535
Natural or juridical persons operating in Sweden and public authorities working with viability in
competitive sectors on market conditions are eligible. In some cases aid can also be
granted to non-profit making associations. There is a requirement that at least 40 per
cent of the new jobs created shall be reserved for each sex. Minor employment grants
are awarded automatically after application if all conditions are fulfilled. If the number
of additional man-years is exceeding 10, the applications are examined from the
company's economic point of view.
The nature of assisted projects are costs related to additional labour taken on.
The aid intensity is in regional aid area 1: A total sum of SKr 200,000 per additional man-year
allocated according to a uniform scheme during a five-year period.
The aid intensity is in regional aid area 2: A total sum of SKr 120,000 per additional man-year
allocated according to a uniform scheme during a five-year period.
The allocation is described in the following table:
Year Aid area 1 Aid area 2
1
2
3
4
560,000
50,000
40,000
30,000
20,00040,000
30,000
25,000
15,000
10,000
Total 200,000 120,000
6.6 Reduced social security contributions
(a) Form of subsidy
Tax concessions in the form of reduced social security contributions.
(b)Amount of subsidy
Net cost in SKr millions: Fiscal year 1993/1994: 471
Support is granted to a variety of sectors and recipients and cannot be broken down per unit.
(c)Policy objective
The primary objective is regional aid to designated areas. The secondary objective is aid to SMEs and
employment in designated areas. The main objective is to create new employment
and to maintain employment in certain sectors in the most disadvantaged areas by
reducing the cost of labour. An overall aim is to compensate for additional costs due
to permanent geographical disadvantages in the form of long distances, low population
density and remote location.
(d)DurationG/SCM/N/3/EEC
Page 536
In aid area 1 and 2 the duration is until and including the year 2000. In the rest of the Norbotten
county the duration is until and including the year 1995.
(e)Statistical data
The support is granted to a variety of sectors and recipients, therefore it is not possible to present
statistical data permitting an assessment of trade effects.
(f)Legal bases
The legal provisions are laid down in the Act (Lag om nedsättning av socialavgifter och allmän
löneavgift) SFS 1990:912 and the Governmental Ordinance (Förordning om
nedsättning av socialavgifter och allmän löneavgift): SFS 1990:983.
(g)Rules and conditions
In aid area 1 and parts of aid area 2 the reduction is 10 percentage points. In those parts of the
northernmost county of Norrbotten which are not included in aid area 1 the reduction
is five percentage points.
The social security contributions are reduced for employers engaged in the following sectors in aid area
1: mining and quarrying (except iron, ore and mining), manufacturing (except pulp,
paper, iron, steel and ferro-alloys), wholesaling of manufacturing goods, hotels and
restaurants and service activities. In aid area 2 the reduction is only available in the
most sparsely populated areas. In these parts e.g. agricultural and forestry activities
and certain private business services are eligible. These activities are very important
for women's employment. In the vast majority of cases the aid is awarded
automatically. Reduced social security contributions may be combined with
employment grants.
6.7 Transport aid
(a) Form of subsidy
Grants.
(b) Amount of subsidy
Net cost in SKr millions: Fiscal year 1993/1994: 293
Support is granted to a variety of sectors and recipients and cannot be broken down per unit.
(c)Policy objective
The primary objective is regional aid to designated areas. The secondary objective is aid to SMEs and
aid to partly compensate for high transport costs due to long distances to the main
markets. It is important to create new employment and to maintain employment in
those areas in Sweden where the costs of transport is considerably higher than in the
rest of the country. Hereby these companies are put on more equal footing when
competing with companies situated closer to the large markets.
(d)DurationG/SCM/N/3/EEC
Page 537
The scheme commenced in 1971. Duration formally decided on for every new fiscal year.
(e)Statistical data
The support is granted to a variety of sectors and recipients, therefore it is not possible to present
statistical data permitting an assessment of trade effects.
(f)Legal bases
The legal provisions are laid down in the Governmental Ordinance: SFS 1980:803 (Förordningen om
regionalpolitiskt transportstöd).
(g)Rules and conditions
Eligible are Swedish natural or juridical persons, foreign company branches in Sweden or foreign
natural persons living in Sweden.
The assisted projects: actually paid domestic transport costs from the regional aid area for goods that
have been produced or manufactured (processed) in this area (except for certain
products like pulp, paper, metals, certain steel products and iron ore), transport costs
for raw materials that shall be processed in the transport aid area is also eligible.
However, in principle, materials from outside the aid area that are also produced in the
aid area are not eligible. The goods transported must be highly processed in order to
be eligible. The grant is awarded automatically after application if all the conditions
are fulfilled.
The regional aid area for transport is divided into five zones. The percentages of the transport costs
that are covered appear in the following table:
Distance
in
kilometresTransport
aid
zone 1Transport
aid
zone 2Transport
aid
zone 3Transport
aid
zone 4Transport aid
zone 5
251-400
401-700
701-10%
10%
10%10%
20%
20%10%
30%
30%10%
35%
35%10%
35%
50%
6.8 The Fund for Northern Sweden
The Fund has been operating with two different types of activities:
-loans, including guarantees and conditional loans given primarily to small- and medium-sized
companies within the industrial and service sector.
-guarantees and project support given to institutions or projects and research of infrastructural character
(for example, research activities at universities and college, foundations of research
bodies outside the university sphere). As from 1994 the Fund has primarily
concentrated on loan operations.G/SCM/N/3/EEC
Page 538
(a)Form of subsidy
Mainly loans at market conditions. No subsidies, risksharing. Conditional loans, guarantees, grants
and project support.
(b)Amount of subsidy
Net cost in SKr millions Fiscal year 1993/1994: 67
Support is granted to a variety of projects and recipients and cannot be broken down per unit.
(c)Policy objective
The primary objective is regional aid to designated areas. The secondary objective is aid to SMEs and
R&D. The aim of the fund is to promote development mainly of SMEs, at present, in
the four northernmost countries.
(d)Duration
The scheme commenced in 1961. Duration has not been specified.
(e)Statistical data
The support is granted to a variety of projects and sectors, therefore it is not possible to present
statistical data permitting an assessment of trade effects.
(f)Legal bases
Government Decision 1961, revised in 1987 and Government Bill 1993/94:140.
(g)Rules and conditions
Expenditure eligible for aid is product development, marketing, fixed assets and working capital. If
loans from the Fund Northern Sweden are combined with localization aid, the State
financing may only amount to 70 per cent of investment costs in aid area 1 and 50 per
cent in aid area 2 and structural aid areas. The government can decide that these
levels may be exceeded if there is a special priority.
7. OTHER FORMS OF SUBSIDIES
7.1 State subsidy for civil emergency preparedness supply
(a)Form of subsidy
Grants.
(b) Amount of subsidy
Net cost in SKr millions: Fiscal year 1993/1994: 9
Support is granted to a variety of projects and cannot be broken down per unit.
(c)Policy objectiveG/SCM/N/3/EEC
Page 539
Primary objective is mainly to prepare for the supply of goods for the mobilization of the armed forces.
(d)Duration
Duration has not been specified.
(e)Statistical data
The support is granted to a variety of projects and sectors, therefore it is not possible to present
statistical data permitting an assessment o trade effects.
(f)Legal bases
The legal provisions are laid down in the Governmental Ordinances: SFS 1984:1129 (Förordningen
om försörjningsberedskapsstöd) and 1992:1114.
(g)Rules and conditions
Government agencies, county councils and municipalities, and firms owned by them, are eligible to civil
emergency preparedness grants for acquisition of textiles and ready-made garments,
shoes, leather, skin and furs. A precondition is that the acquisition must not break the
rules of competition within the EEA. Civil emergency preparedness support is
granted to that amount which constitutes the difference between the costs for the most
favourable acquisition in Sweden and the most favourable acquisition outside the
European Economic Area. The support can however only be granted, if the
difference is less than SKr 200,000 or less than 20 per cent of the acquisition value of
the foreign offer.G/SCM/N/3/EEC
Page 540
APPENDIX
The net-cost method
The objective of the Net Cost to Government (NCG) method is to obtain a consistent measure
of government aid, where support from various instruments, i.e. grants, loans, guarantees, equity
injections and tax concessions, are added together. The NCG method is used in the EFTA annual
surveys of industrial aid and by OECD in its project "Subsidies and Structural Adjustment".
Net costs are calculated as follows:
Grants: Actual amounts paid out minus repayments and royalties if any.
Guarantees: Claims paid minus fees received and recoveries.
Loans: Estimated capital cost based on the difference between the government borrowing rate and
actual interest payments received.
Equity capital: Estimated capital cost based on the government borrowing rate and dividends received.
Tax concessions: Estimations of revenue forgone.
It should be noted that the net cost does not correspond to the actual transfer of funds from
the government to the firms in any given year, i.e. the expenditure as reported in the government
budget. Instead the purpose is to indicate the net cost to government of support to industry. Since
imputed capital costs on previous loans and equity injections are included, the net-cost figures to a
certain extent reflect past policies. The NCG-method is not a direct guide to determine the extent of
distortion of competition nor to approximate the ultimate benefit to industry. However, the NCG is a
useful guide to the evolution and the structure of government support over time.G/SCM/N/3/EEC
Page 541
ANNEX 2
Subsidies to Swedish Agriculture
1993/94
Notification Under Article 25 of the WTO Subsidies Agreement
Page
I. Introduction 541
2. Income and price support 542
2.1 Temporary direct payments 542
2.2 Conversion grants 543
2.3 Regional headage support 590
2.4 Regional price additions 545
2.5 Support to potato-cultivation in the north of Sweden 546
2.6 Price support to the reindeer sector 547
2.7 Price support to clover and grass 548
2.8 Support to sugar production on the island of Gotland 548
3. Export promotion 549
3.1 Temporary export subsidies 549
3.2 Special support to export of processed food products 550
3.3 Export promotion for highly processed products 551
4. State aid for investments in agricultural production 552
4.1 Land and building rationalisation 552
4.2 Setting up aids to young farmers 553
5. State aid to compensate for damage affecting agricultural production or means of 554
production
5.1 Compensation for losses connected to control of quarantine, pest and diseases 554
5.2 Compensation for cost and losses connected to control of epizootic diseases 554
5.3 Compensation for costs and losses connected with control of salmonella 555
5.4 Compensation for losses which are a consequence of radioactive fallout 556
5.5 Compensation for losses as a result of natural disaster in the reindeer sector 557
5.6 Compensation to owners of domestic animals and reindeer hurt or killed by 557
beast of prey
5.7 Compensation for damages caused by wild animals 558
6.1 Support of landscape conservation 559
7.1 State guarantees on loans 560
8.1 State aid for farm relief services 560
9.1 State aid for guidance and adaptation of new activities 561
10.1 Support to development of reindeer husbandry 562G/SCM/N/3/EEC
Page 542
Page
11.1 Health care for farmers 563
12.1 Early retirement scheme for milk producers 563
13.1 Compensation for high costs of veterinary services 564G/SCM/N/3/EEC
Page 543
1. Introduction
This notification covers direct subsidies and payments to the agricultural sector in fiscal year
1993/94. The figures are presented irrespective of whether or not they should be regarded as subsidies
notifiable under Article 25 of the WTO Subsidies Agreement. Costs for general agricultural education
and information activities are not included in this notification. The description of the various schemes
follows the outline suggested by WTO. However, estimates of the effects of aid, e.g. on trade, are not
available. Instead some general information about production, consumption and trade is presented in
Annex I.
A new food policy was introduced in Sweden as from 1 July 1991. The guidelines for the
policy were laid down by a parliamentary decision in 1990. The decision resulted in a radical shift in
the policy. Due to the Swedish application for membership of the EU some amendments were made
in order to facilitate an immediate integration into the common Agricultural Policy on 1 January 1995.
The food policy in the period 1 July 1991 - 31 December 1994 was based on the principle that
the agricultural sector should be subject to the same conditions as other sectors of the economy. The
farmers should only be paid for goods and services for which there was a demand. This implied a
dismantling of internal market regulations including storage support and to a great extent export
subsidies. Continued border protection in form of import levies ensured that a price support was
maintained for the production for which there was a demand on the internal market. It was however
decided that a revision of the border protection was pending the outcome of the ongoing
GATT-negotiations (the Uruguay Round).
The reform of the agricultural policy started on 1 July 1991 and was scheduled to be completed
after a five-year period of adjustment of production and transition to a deregulated market.
The importance of agriculture in the northern parts of Sweden, in terms of Swedish regional
and security policy, justified additional support to this part of the country (regional support).
During the transitional period farmers were stimulated by direct payments to plant alternative
crops, energy crops and forest. Substantial investments were also made in educational and advisory
schemes. The reform necessitated considerable adjustments, not only as regards production, but also
in the farmer's entrepreneurial role.
Due to the GATT/UR Mid-Term Agreement direct payments to farmers were introduced in
1989 instead of increases in support prices. These direct payments were decided just to be temporary.
In 1993/94 temporary direct payments were granted to the animal sector as well as to the crop sector.
These payments are more decoupled than support via the producer prices. Also part of the regional
support to the northern parts of Sweden was paid on the same basis as the temporary direct payments.
The regulation for agricultural products in 1993/94 was based on the Law Regarding Levies on
Certain Agricultural Products (SFS 1190:615). The Swedish Board of Agriculture was the central
administrative authority for matters concerning the regulation in the agricultural sector.G/SCM/N/3/EEC
Page 544
2. Income and price support
2.1 Temporary direct payments
(a)Form of subsidy
Grants
(b) Amount of subsidy
SKr 1,530 million 1993/94
(c) Policy objective
Due to the GATT/UR Mid-Term Agreement direct payments to farmers were introduced in 1989
instead of increases in support prices.
(d)Duration
The programme commenced in 1989. Duration until 31 December 1994.
(e)Statistical data
Estimates of the effects on trade are not available. General information about trade see Annex I.
(f) Legal basis
The temporary payments are based on Governmental Ordinances SFS 1989:896 and SFS 1993:298
(g)Rules and conditions
The temporary direct payments were based on livestock units or crop area in a base year. In the
animal sector standard payment per animal unit were applied. The acreage support
differed between different production regions since it was based on historical yields in
the production regions. In the table below total amounts of payments and payments
per units are shown. The Swedish Board of Agriculture was the Governmental agency
responsible for the administration of the temporary direct payments.
Total (Skr million) Payment per unit
Milk production
Beef and veal production
Sheep and lambmeat production
Acreage support
Total629
332
19
851
1,530Skr 1,200/milk cow
Skr 155/young stock
Skr 90/lamb
Average Skr 700/ha
2.2 Conversion grants
(a)Form of subsidy
Grants/conditional loansG/SCM/N/3/EEC
Page 545
(b) Amount of subsidy
The net cost in fiscal year 1993/94 was SKr 16 millions.
(c) Policy objective
The intention of the conversion grants was to facilitate the conversion of area previously used for
surplus production of grains to non-agricultural production.
(d)Duration
The programme commenced as from 1 July 1991 and enrolment in the programme was possible up to
1 July 1994.
(e)Statistical data
Estimates of the effects on trade are not available.
(f) Legal basis
Governmental Ordinance SFS 1990:941
(g)Rules and conditions
Within the programme grants were paid to the farmer as a lump sum on a regionally differentiated
hectare basis. Grants were differentiated according to which year the land was
enrolled in the system. The grants were paid as a conditional loan and were to be
repaid if by end of the transition period the farmer had failed to convert the land to
other uses than production of formerly price regulated commodities. All land that
previously was used for price regulated crops and for set aside under the scheme
Omställning 90 was eligible for the programme. The Swedish Board of Agriculture
was the Governmental agency responsible for the administration of the programme.
2.3 Regional headage support
(a)Form of subsidy
Grants
(b)Amount of subsidy
Fiscal year 1993/94 356 millions
(c)Policy objective
The importance of agriculture in the north of Sweden in terms of regional and security policy justifies
special support to this part of the country. The support should be closely related to
the profitability trends and should give farms in the north of Sweden incomes
comparable with farms in other parts of the country.
(d)DurationG/SCM/N/3/EEC
Page 546
The programme will be revised in 1995 as a consequence of the Swedish membership of the EU.
(e)Statistical data
Estimates of the effects on trade are not available. General information about trade see Annex 1.
(f)Legal basis
Governmental Ordinance SFS 1989:896
(g)Rules and conditions
Part of the regional support to northern parts of Sweden was based on livestock units in a base year.
The amount of support differed between different areas of the northern region. In
1993/94 this type of headage support was paid to milk, beef and veal, pigmeat, sheep
and lamb meat and egg production. Total and unit amounts in different districts are
shown in tables below. Concerning the division into different districts for regional
support see Annex H.
Milk production Total (SKr million) Payment per milkcow (SKr)
District 1
District 2a
District 2b
District 3
District 4
Total32.6
108.3
59.7
36.1
33.5
270.23,610
3,160
3,030
2,450
1,160
Beef and veal production Total (SKr million) Payment per youngstock (SKr)
District 1
District 2
District 3
District 4
Total7.8
47.0
9.1
10.4
74.3560
525
330
200
Pigmeat production Total (SKr million) Payment per slaughterpig (SKr)
District 1
District 2
District 3
District 4
Total0.1
3.5
1.0
1.6
6.245
40
35
20G/SCM/N/3/EEC
Page 547
Sheep and lamb meat production Total (SKr million) Payment per lamb (SKr)
District 1
District 2
District 3
District 4
Total0.4
1.3
0.3
0.3
2.385
80
50
30
Egg production Total (SKr million) Payment per laying hen (SKr)
District 1
District 3 and 4
Total-
-
313.45
4.90
2.4 Regional price additions
(a)Form of subsidy
Grants
(b) Amount of subsidy
Fiscal year 1993/94 SKr 599 millions
(c) Policy objective
The importance of agriculture in the north of Sweden in terms of regional and security policy justifies
special support to this part of the country. The support should be closely related to
the profitability trends and should give farms in the north of Sweden incomes
comparable with farms in other parts of the country.
(d) Duration
The programme will be revised in 1995 as a consequence of the Swedish membership of the EU.
(e) Statistical data
Estimates of effects on trade are not available
(f)Legal basis
Governmental Ordinance SFS 1985:672 last amended by SFS 1994:1311
(g)Rules and conditions
A part of the regional support to northern parts of Sweden was given as price additions in order to
compensate i.a. for higher production and transportation costs in the north parts of
Sweden. The amount of support differed between different areas of the northern
region. This type of support was in 1993/94 paid to milk, beef and veal, pigmeat,
sheep and lamb meat and egg production. The Swedish Board of Agriculture was
responsible for disbursing the aid.G/SCM/N/3/EEC
Page 548
Milk production: A regional support was given as price additions and cost compensation per litre
milk, varying between different geographical locations. In 1993/94 the total amount of
price additions was SKr 424 million (0.24-1.10 SKr/kg. milk). At the same fiscal year
SKr 42 million was paid as compensation for higher transportation costs (0.02-0.11
SKr/kg. milk).
Beef and veal production: A regional support was given as price additions and cost compensation per
kilo meat, varying between different geographical locations. In 1993/94 the total
amount of price additions was SKr 92 million (1.20-8.35 SKr/kg. meat). At the same
fiscal year SKr 21 million was paid as compensation for higher transportation costs.
This amount was compensation to all types of meat.
Pigmeat production: A regional support was given as price additions per kilo meat, varying between
different geographical locations. In 1993/94 the total amount of price additions was
SKr 14 million (0-2.05 SKr/kg. meat).
Sheep and lamb meat production: A regional support was given as price additions per kilo meat,
varying between different geographical locations. In 1993/94 the total amount of price
additions was SKr 4 million (0.30-0.85 SKr/kg. meat).
Egg production: A regional support was given as compensation for higher transportation costs. Total
amount in 1993/94 was SKr 2 million (0.35 SKr/kg.)
2.5 Support to potato cultivation in the north of Sweden
(a)Form of subsidy
Grants
(b)Amount of subsidy
Fiscal year 1993/94 SKr 8 millions.
(c)Policy objective
The importance of agriculture in the north of Sweden in terms of regional and security policy justifies
special support to this part of the country. The support should be closely related to
the profitability trends and should give farms in the north of Sweden incomes
comparable with farms in other parts of the country.
(d)Duration
The programme will be revised in 1995 as a consequence of the Swedish membership of the EU.
(e)Statistical data
Estimates of effects on trade are not available.
(f)Legal basis
Governmental Ordinance SFS 1985:672 last amended by SFS 1994:1311.G/SCM/N/3/EEC
Page 549
(g)Rules and conditions
Holdings with potato cultivation in certain regions in the north of Sweden (counties of Norrbotten,
Västerbotten, Jämtland, Västernorrland and Gävleborg) received support. Aid was
only given to holdings with more than 2 hectares cultivated farmland and of which at
least 0.5 hectare had a potato cultivation. Amount of aid depended on region, from
SKr 2,532 per hectare to SKr 4,272 hectare. The Swedish Board of Agriculture was
responsible for disbursing the aid.
2.6 Price support to the reindeer sector
(a)Form of subsidy
Grants
(b)Amount of subsidy
Fiscal year 1993/94 SKr 30 millions.
(c)Policy objective
Reindeer husbandry is an integrated part of Sami culture. Without adequate support the reindeer
husbandry sector will be seriously threatened with grave consequences for the Sami
people.
(d)Duration
Duration unlimited
(e)Statistical data
Estimates of effects on trade are not available.
(f)Legal basis
Governmental Ordinance SFS 1986:255
(g)Rules and conditions
The price support is based on the slaughtered weight of the reindeer. In 1993/94 the support was SKr
10 per kilo for reindeer older than one year and SKr 16 per kilo for calves. An
amount of SKr 0.5 per kilo was earmarked for marketing of reindeer meat.
The support is paid to reindeer owners. The Swedish Board of Agriculture is responsible for
disbursing the support.
2.7 Price support to clover and grass seed
(a)Form of subsidy
Grants
(b) Amount of subsidyG/SCM/N/3/EEC
Page 550
Fiscal year 1993/94 SKr 9.6 million.
(c) Policy objective
The objective is to support the domestic production of clover and grass seed.
(d) Duration
Duration until 31 December 1994.
(e) Statistical data
Estimates of the effects on trade are not available.
(f) Legal basis
Governmental Ordinance SFS 1990:941
(g) Rules and conditions
There is no form of border protection for clover and grass seed in Sweden. Support to domestic
production of this type of seed is given in the form of an area based support and a
fixed price support per kilogram of sealed seed. The support is paid to the farmers.
In fiscal year 1993/94 acreage support varied between 300 and 2,800 SKr/ha
depending on variety. Total amount of acreage support was SKr 5 million. The price
support varied between 0.00 and 5.20 SKr/kg. with a total amount of SKr 4.6 million.
2.8 Support to sugar production on the island of Gotland
(a)Form of subsidy
Grants
(b) Amount of subsidy
Fiscal year 1993/94 SKr 12.5 million.
(c) Policy objective
The objective of the support is to compensate for costs at the sugar factory located on the island of
Gotland.
(d)Duration
The support in this form will last longest to the end of the 1995 beet season.
(e)Statistical data
Estimates of the effects on trade are not available.
(f)Legal basisG/SCM/N/3/EEC
Page 551
Governmental Decision
(g)Rules and conditions
According to a parliamentary decision support shall be granted to the sugar factory on the island of
Gotland during a transitional period. The support shall compensate for extra costs at
the sugar factory.
3. Export promotion
3.1 Temporary export subsidies
(a)Form of subsidy
Grants
(b)Amount of subsidy
Product SKr/kg. Total SKr million
Wheat
Barley
Oats
Rye
Rapeseed
Beef meat
Pig meat
Peas
Processed products
Total0.54
0.82
0.59
0.87
2.20
17.35
9.59
0.3049.8
28.5
0.9
1.0
28.4
46.9
48.9
6.8
611.1
822.3
(c) Policy objective
Export subsidies were abolished for most products as an effect of the food policy reform. For grains,
oilseeds, pigmeat, beef meat and peas export subsidies were maintained during a
transition period to ease the transition to the conditions of a deregulated market. The
price compensation system for processed products was maintained pending
negotiations between EFTA and EC regarding a new compensation system.
(d) Duration
Duration until 31 December 1994.G/SCM/N/3/EEC
Page 552
(e) Statistical data
Estimates of the effects on trade are not available. General information about trade see Annex 1.
(f)Legal basis
The export subsidies are based on Governmental Ordinances SFS 1991:133 and SFS 1990:941
(g)Rules and conditions
When parliament decided to reform the agricultural policy it also was decided that the redemption
systems for grains and oilseeds should be kept during a transitional period. If world
market prices for these products were lower than domestic prices the difference should
be levelled out when the products were exported. The equalization was handled by
the Swedish Board of Agriculture and was financed by milling fees, budgetary means
etc. For beef and pigmeat a sum of SKr 550 million was allocated to a temporary
export financing system for the period I July 1991 - 31 December 1994. For peas
export subsides were paid during the transitional period. For 1993/94 support was
maximized to SKr 10 millions and to SKr 0.30/kg. The price compensation
system (RAK) for processed products covers products of second and higher
transformation which often are a mixture of two or more agricultural products. The
aim of the system is to compensate domestic producers of processed agricultural
products for the difference between domestic prices and world market prices for
agricultural raw materials used in the production. The compensation to exported
products is calculated on basis of the quantities of agricultural raw materials actually
used in the production of the products exported. All these systems were handled by
the Swedish Board of Agriculture.
3.2 Special support to export of processed food products
(a)Form of subsidy
GrantsG/SCM/N/3/EEC
Page 553
(b)Amount of subsidy
Product SKr/kg. Total SKr million
Rapeseed oil
Cheese
Milk products
Poultry meat
Pork
Malt
Starch
Total0.80
5.29
1.29
3.18
6.24
0.20
1.500.1
8.5
0.7
1.6
1.0
1.0
2.4
15.3
(c) Policy objective
The objective is to temporary increase the possibilities to export processed food products with a
long-term profitability.
(d)Duration
The programme commenced as from 1 July 1993. Duration until 31 December 1994.
(e)Statistical data
Estimates of the effect on trade are not available. General information about trade see Annex 1.
(f)Legal basis
The system was based on Governmental Ordinances SFS 1991:133 and SFS 1993:964
(g)Rules and conditions
In view of the Swedish application for membership of the EC the special system for export support
directed to certain processed food was introduced in 1993. The support was limited
to a sum of SKr 150 million for the period 1 July 1993 - 31 December 1994.
3.3 Export promotion for highly-processed products
(a)Form of subsidy
Grants
(b)Amount of subsidy
In 1992 SKr 60 millions was assigned as a lump sum for a four-year period.
(c)Policy objective
The primary objective is to promote an international marketing of processed food products.
(d)DurationG/SCM/N/3/EEC
Page 554
The support was commenced in 1992 and scheduled for a four year period
(e)Statistical data
The support is granted to a variety of projects, therefore estimates of the effects on trade are not
available.
(f)Legal basis
Decision by the Government
(g)Rules and conditions
"Styrgruppen för livsmedelsexport" (Food from Sweden) is responsible for disbursing the aid. Since the
objective is to promote an international marketing of processed food products the aid
is granted to measures such as to build up knowledge and competence of export
promotion, marketing and to carry through common market research and information
activities. Support is not granted to investments.
4. State aid for investments in agricultural production
4.1 Land and building rationalization
(a)Form of subsidy
Grants
(b)Amount of subsidy
The net cost for internal and external rationalisation in fiscal year 1993/94 was SKr 3 million.
(c)Policy objective
To improve the competitiveness of agricultural holdings as part of the rational development of
agricultural production while maintaining farmers incomes.
(d)Duration
No new commitments are made under this programme. Only legal undertakings by the State to carry
out a given payment are done.
(e)Statistical data
Estimates of the effects on trade are not available. General information about trade see Annex I.
(f)Legal basis
Governmental Ordinances SFS 1978:250 and SFS 1988:999
(g)Rules and conditionsG/SCM/N/3/EEC
Page 555
The Swedish Board of Agriculture is responsible for disbursing the aid. The aid is used for land
surveying costs in certain areas of Sweden in connection with reparcelling of farms in
order to improve structure. No new commitments are made under this programme.
4.2 Setting up aid to young farmers
(a)Form of subsidy
Interest rate subsidy
(b)Amount of subsidy
Total amount of subsidy in 1993/94 SKr 30 millions.
(c)Policy objective
To enable young persons who intend to practice farming as their main occupation, to take over
agricultural holdings.
(d)Duration
The programme may be revised in 1995 as a consequence of the Swedish membership of the EU.
(e)Statistical data
Estimates of the effects on trade are not available.
(f)Legal basis
Governmental ordinance SFS 1990:980
(g)Rules and conditions
The Swedish County Administrative Boards are responsible for disbursing the aid. Aid may be
granted to persons that not have reached the age of 35, who intend to practice farming
as their main occupation. The definition farming also includes other activities such as
forestry and tourism as a complement to farming. The purpose of the aid is to cover
the capital costs and the risks connected with the responsibilities of young farmers.
Farmers in the entire country can receive support but special
considerations are given to holdings in less favoured areas. The applicants must have a
sufficient level of vocational qualification (vocational experience and training). The
applicants must also have farming as their main occupation. Aid is given as a 5 per
cent interest-rate subsidy for a period of five years. Maximum installation aid for a
period of five years is SKr 200,000. The amount can be reduced depending on the
applicant's assets.
5. State aid to compensate for damage affecting agricultural production or means of production
5.1 Compensation for losses connected to control of quarantine, pest and diseases
(a)Form of subsidy
GrantsG/SCM/N/3/EEC
Page 556
(b)Amount of subsidy
Fiscal year 1993/94 SKr 30 millions.
(c)Policy objective
Compensate farmers and growers for economic losses caused by quarantine, pest and diseases.
(d) Duration
Duration unlimited
(e)Statistical data
Estimates of the effects on trade are not available.
(f) Legal basis
Governmental Ordinances SFS 1972:318 and SFS 1993:383 amended by SFS 1994:326.
(g)Rules and conditions
Farmers and growers are compensated for economic losses when destruction or prohibition of
marketing is used as a method for control of pest and diseases. The Swedish Board of
Agriculture is responsible for disbursing the aid.
5.2 Compensation for cost and losses connected to control of epizootic diseases
(a)Form of subsidy
Grants
(b)Amount of subsidy
Fiscal year 1993/94 SKr 18 million.
(c) Policy objective
Compensate animal owners for economic losses if an epizootic disease in accordance with the Swedish
legislation is suspected or diagnosed in a herd or flock.
(d) Duration
Duration unlimited.
(e) Statistical data
Estimates of effects on trade are not available.
(f) Legal basisG/SCM/N/3/EEC
Page 557
Epizootilaw SFS 1980:369. Amendments made until SFS 1994:1114.
Epizootiordinance SFS 1980:371. Amendments made until SFS 1994:1114.
(g)Rules and conditions
If an epizootic disease in accordance with the Swedish legislation is suspected or diagnosed in a herd or
flock, the measures taken often cause economical losses for the animal owner. The
general principle for compensation of diseases under Epizootic Act is that the farmer
should be fully compensated for losses due to decisions taken in accordance with this
legislation. Economical losses caused by the restrictions on the herd, slaughtered
animals, loss of income and sanitary measures are fully compensated for. The
Swedish Board of Agriculture is responsible for disbursing the aid.
5.3 Compensation for costs and losses connected with control of salmonella
(a)Form of subsidy
Grants
(b)Amount of subsidy
Fiscal year 1993/94 SKr 8 millions.
(c)Policy objective
Preventing that salmonella is spread and to protect public health.
(d)Duration
Duration unlimited
(c) Statistical data
Estimates of effects on trade are not available
(f) Legal basis
The law SFS 1983:738 and Governmental Ordinance 1984:306.
(g)Rules and conditions
Farmers whose animals are diagnosed as being affected by salmonella are partly (50-70 per cent)
compensated by the government for economical losses caused by the effects of the
restrictions on herd, slaughter of animals, loss of income and sanitary measures. The
cost of the salmonella programme can be split into two main components. one is the
continuous surveillance and preventive measure needed and the second is the cost of
eradicating salmonella outbreak. The aid is only available in connection with
salmonella outbreak and due to decisions taken in accordance with legislation. The
Swedish Board of Agriculture is responsible for disbursing the aid.
5.4 Compensation for losses which are a consequence of radioactive fallout
(a)Form of subsidyG/SCM/N/3/EEC
Page 558
Grants
(b)Amount of subsidy
Fiscal year 1993/94 SKr 30 millions.
(c)Policy objective
Compensate for losses due to radioactive contamination of meat.
(d)Duration
Duration unlimited
(e)Statistical data
Estimates of effects on trade are not available
(f)Legal basis
Governmental Ordinance SFS 1994:246
(g)Rules and conditions
To compensate for losses due to the Tjernobyl accident the State buys radioactive contaminated meat
at the normal market price for similar uncontaminated meat and afterwards destroys it.
The State also compensates reindeer keepers and farmers for preventive measures
taken, such as feeding the animals with uncontaminated food or other measures to
decrease radiocesium to the acceptable level. The Swedish Board of Agriculture is
responsible for disbursing the aid.
5.5 Compensation for losses as a result of natural disaster in the reindeer sector
(a)Form of subsidy
Grant
(b)Amount of subsidy
Fiscal year 1993/94 SKr 4 millions.
(c)Policy objective
Preventing mass death from starvation in the reindeer sector as a result of natural disasters.
(d)Duration
Duration unlimited
(e)Statistical data
Estimates of effects on trade are not available.G/SCM/N/3/EEC
Page 559
(f)Legal basis
Decision by Government
(g)Rules and conditions
As a result of natural disasters, in particular hard frozen snow, reindeer can not feed themselves. The
aid is aimed at preventing mass death from starvation. Compensation is granted for
additional feeding during winters with very bad weather conditions. In 1993/94, 50
per cent of the cost for buying additional feed in certain areas was given as an aid. The
Swedish Board of Agriculture is responsible for disbursing the aid.
5.6 Compensation to owners of domestic animals and reindeer hurt or killed by beast of prey
(a)Form of subsidy
Grant
(b)Amount of subsidy
Fiscal year 1993/94 SKr 14 millions.
(c)Policy objective
Compensate for losses connected with the prohibition by law to hunt beast of prey (bears, wolves,
wolverines, lynx and eagles).
(d)Duration
Duration unlimited
(e)Statistical data
Estimates of effects on trade are not available
(f)Legal basis
Governmental Ordinance SFS 1976:430
(g)Rules and conditions
Reindeer keepers and farmers are compensated for animals hurt or killed by beast of prey. The state
is not the legal owner of the beast of prey but has by law prohibited hunting of these
animals. The aid should be seen as a compensation for losses connected with this
hunting restriction. The value of the animals is estimated and given as a compensation
to the owner. In 1993/94, 97 percent of the compensation concerned reindeer and 3
per cent other domestic animals (sheep, dogs, cattle, horses and bees). The National
Board for Environment Protection is responsible for disbursing the aid.G/SCM/N/3/EEC
Page 560
5.7 Compensation for damages caused by wild animals
(a)Form of subsidy
Grant
(b)Amount of subsidy
Fiscal year 1993/94 SKr 17 millions.
(c)Policy objective
Compensate for losses connected with the prohibition by law to hunt certain animals other than beast of
prey.
(d)Duration
Duration unlimited
(e)Statistical data
Estimates of effects on trade are not available
(f)Legal basis
Governmental Ordinance SFS 1987:905
(g)Rules and conditions
The State has, for reasons of preservation, also prohibited hunting of certain wild animals other than
beast of prey. Compensation is given to land owners and fishermen for damages
caused by those animals. The main part of the compensation goes to fishermen for
damages on fishing equipment caused by seals. The State pays part of the costs due to
estimated damages. The National Board of Environmental Protection is responsible
for disbursing the compensation.
6.1Support for landscape conservation
(a)Form of subsidy
Grant
(b)Amount of subsidy
Fiscal year 1993/94 SKr 255 millions.
(c)Policy objectiveG/SCM/N/3/EEC
Page 561
Maintaining biodiversity of semi-natural grasslands and remnants of agri-historical value in rural
landscapes.
(d)Duration
Duration unlimited
(e)Statistical data
Estimates of effect of aid on trade are not available
(f)Legal basis
Decision by the Parliament
(g)Rules and conditions
Grants to special measures in order to maintain biodiversity of semi-natural grasslands and remnants of
agri-historical value in rural landscapes. Support is paid for grazing and moving sward
in selected meadows and pastures. Grants are also paid to farmers for keeping
historical remnants in order. The Swedish County Administrative Boards are
responsible for disbursing the aid.
7.1State guarantees on loans
(a)Form of subsidy
Guarantees on loans
(b)Amount of subsidy
The cost for losses that incur in connection with State guarantees during fiscal year 1993/94 was
approximately SKr 40 millions.
(c)Policy objective
The objective is to promote improved effectiveness in the agricultural holding.
(d)Duration
As from 1 July 1995 new state guarantees on loans are to be granted only to horticultural enterprises.
(e)Statistical data
Estimates of effects on trade are not available
(f)Legal basis
Governmental Ordinances SFS 1978 :250 reprinted SFS 1998:999 and SFS 1979:427 reprinted
1988:998.
(g)Rules and conditions