production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.009 percent ad valorem.
13. Newfoundland: Enhancement of Fishing Operations
Based on information contained in the Public Accounts for the Department of Fisheries, the government of Newfoundland awards funding for special research and development projects aimed at improving the techniques used in the Newfoundland fishing industry. In 1983-84, the only year for which information was available, grants went to research on longline use and research for improving the overall quality of fish products by establishing universal standards of fresh fish quality. Because we have no information on other research and development projects funded by the government of Newfoundland, nor information on the availability of research results, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable. Because financial data were unavailable for any years other than 1983-84, we used, as best information available, the total grants disbursed for research in offshore fishing operations in 1983-84 as representing the amount disbursed during the review period, and expensed this amount to the year of receipt. Dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the
(Cite as: 51 FR 10041, *10053)
review period, we calculated an estimated net subsidy of 0.001 percent ad valorem.
14. Newfoundland: Marketing Assistance
Based on information contained in the Public Accounts for the Department of Fisheries, the government of Newfoundland offers grants for marketing assistance, designed to encourage consolidation of marketing by small processors to offset the market advantages exercised by the larger processing companies. Because grants under this program are provided only to fish processors, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable. Because financial data were unavailable for any years other than 1983-84, we used, as best information available, the total grants disbursed for marketing assistance in 1983-84 as representing the amount disbursed during the review period, and expensed this amount to the year of receipt. Dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.001 percent ad valorem.
15. Nova Scotia: Fishing Vessel Construction Program (FVCP)
(Cite as: 51 FR 10041, *10053)
The FVCP was designated to assist individuals, companies, and associations in the fishing industry to construct and operate fishing vessels. The FVCP was in effect from November 22, 1977, through March 31, 1980. The Department of Fisheries of Nova Scotia (DFNS) assessed applications for assistance on the basis of the contribution that construction and operation of the vessels would have on the fishing industry of Nova Scotia. Vessels eligible for assistance had to be operated as fishing boats, have a length not exceeding 64 feet, 11 inches, and be built and registered in Canada. Eligible applicants had to agree to keep their vessels registered in Canada and to engage in fishing for five years. Depending on the size of the vessel and the availability of federal subsidies, the amount of the FCVP grant ranged from zero to 35 percent of the vessel's cost.
Because grants under this program were available only for certain vessels used by commercial fishermen, we determine that this program was limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable.
We recognize that this program terminated in 1980. However, according to our grant methodology, grants bestowed from 1978 through 1980 continue to confer benefits during the review period. To calculate the benefit from this program, we allocated the grants received in fiscal years 1978 through 1980 over 18
(Cite as: 51 FR 10041, *10053)
years. Applying the grant methodology and dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.014 percent ad valorem.
16. Nova Scotia: Loans from the Fisheries Loan Board (NSFLB)
The NSFLB, established by the Fisheries Development Act (FDA), administers a loan program designed to provide loans and loan guarantees to commercial fisherman in order to encourage, sustain, improve, and develop the fishing industry of Nova Scotia. Under the regulations pursuant to the FDA, loans are to be made to commercial fisherman for the purpose of building, purchasing, or upgrading boats, developing aquaculture, and assisting the fishing industry generally. In fact, loans made by the NSFLB over the past 12 years have been used primarily for the purchase or upgrading of fishing vessels. To be eligible for a loan from the NSFLB, a commercial fisherman must have at least two years commercial fishing experience within the last five years and be engaged primarily in commercial fishing. Interest rates on approved loans are fixed at eight percent on the first $150,000, 11 percent on the second $150,000, and the current government borrowing rate for loans over $300,000. Interest rates are fisced for the term of the loan. Depending on whether the loan is used to upgrade or to purchase vessels, the repayment period for the
(Cite as: 51 FR 10041, *10053)
loans ranges between five and 12 years. A 20 percent downpayment for each loan is required.
Repondents contend that, because loans under the NSFLB are provided on terms similar to those charged on loans provided by the Nova Scotia Farm Loan Board, loans under this program are not limited to a specific enterprise or industry, or group of enterprises or industries. We disagree. There is no evidence that loans under the farm and fishing programs are linked in any way to an overall provincial lending policy to provide loans on comparable terms to the various qualifying groups. Thus, we must look at each of these programs separately. *10054
(Cite as: 51 FR 10041, *10054)
Loans provided by the Farm Loan Board program were found to be not countervailable in Swine, supra, because they were available on similar terms to all industries in the agricultural sector. In contrast, loans under the NSFLB are limited to one specific industry, the fishing industry.
Comparing the appropriate benchmark described in the "Analysis of Programs" section of this notice to the interest rate charged under this program, we also determine that these loans were made on terms inconsistent with commercial considerations.
To calculate the benefit, we used the long-term loan methodology outlined in the Subsidies Appendix. We treated loans written off during the review period as grants expensed in that year. Dividing the benefit by the f.o.b. value of
(Cite as: 51 FR 10041, *10054)
production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.375 percent ad valorem.
17. Nova Scotia: Industrial Development Division (IDD) Grants
The Industrial Development Division (IDD) of the Nova Scotia Department of Fisheries administers assistance programs designed as incentives for development of the fishing industry of Nova Scotia. Grants may be provided on a 50 percent cost-sharing basis to a maximum of $15,000 per location per fiscal year. An applicant must be a licensed commercial fisherman, processing company, or fishermen's organization. Eight separate programs affecting the fishing industry in Nova Scotia are currently administered by the IDD. (These include three programs referred to individually in our notice of initiation as Icemaking and Fish Chilling Facilities, Gutting Machine, and Plant Development Programs.) Each program is designed to encourage technological innovations and to improve the quality of the fishing industry as a whole. The following is a list of the programs and the general purpose of each:
- IDD Safety Program. Technical and financial assistance is provided to improve safety on vessels and in processing plants.
- IDD Quality Improvement Program. Technical and financial assistance is available for equipment on vessels and in plants that will improve the quality
(Cite as: 51 FR 10041, *10054)
of fish and fish products. Equipment eligible for grants includes: fiberglass or plastic containers, on board insulation, refrigeration, and gutting machines. Grants are also
available for plant development.
- IDD Increased Productivity Program. Technical and financial assistance is available to improve the productivity and efficiency of fish harvesting and fish plant
operations. Unloading equipment, bait sheds, and deck equipment are examples of some items covered by this program.
- IDD Harbor Facilities Program. Assistance is available for constructing and improving private harbor facilities such as private wharves, gear sheds, slipways, and
haulouts.
- IDD Infrastructure Program. Financial assistance is provided to enable processing plants and private wharves to access fresh water supplies and electrical services.
- IDD Fleet Development Program. Assistance is available for developing improved vessel design.
- IDD Technology Development for Fishing Vessels Program. Assistance is available for the development of onboard equipment. Equipment used to harvest less
commonly harvested species and fuel economy equipment are included under the program.
- IDD Technology Development for Fish Gear Program. This program is designed to assist the commercial fisherman to purchase safer, more efficient fishing
(Cite as: 51 FR 10041, *10054)
gear.
Because each of the IDD programs outlined above provides assistance exclusively for the fishing industry, we determine that these programs are limited to a specific enterprise or industry, or group of enterprises or industries, and are countervailable.
To calculate the benefit from these programs, we allocated the grants received since the inception of the program (1977) through fiscal year 1985 over 12, 16 or 18 years appropriate. Applying the grant methodology and dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.81 percent ad valorem.
18. Nova Scotia: Market Development Assistance
Under the Marketing Development Division of the Department of Fisheries, the Market Development Service (MDS) functions to promote fish products generically through the use of mall displays, cooking demonstrations, and distribution of recipe pamphlets and other promotional material. The majority of MDS's activities are directed at the Canadian domestic market. However, amounts spent to cover the costs of the publishing and distribution in the United States of posters and recipe pamphlets promoting Nova Scotia seafood provided a
(Cite as: 51 FR 10041, *10054)
benefit to exporters of fish to the United States during the review period. Because these activities promoted exports to the United States, we determine that the expenses incurred are countervailable.
Dividing the amount spent on promotional activities on exports to the United States by the f.o.b. value of exports of fish and shellfish from Canada to the United States during the reveiw period, we calculated an estimated net subsidy of 0.008 percent ad valorem.
19. P.E.I.: Fishing Vessel Subsidy Program (FVSP)
Under recommendation of the P.E.I. Treasury Board, the P.E.I. Minister of Fisheries in 1978 established the FVSP. This program, which provided grants for the acquisition of new vessels, was in effect from 1978 to 1984. Participation in the program was open to all P.E.I. individuals, partnerships or firms engaged in commercial fishing who had not participated in either the federal or provincial vessel subsidy programs during the previous eight years. Vessel size was limited to between 30 and 75 feet, and only those vessels constructed in P.E.I. shipyards were eligible. Participating fishermen received a payment equal to 15 percent of the total cost of the new vessel and engine, plus all other new fixed equipment required on board the vessel, up to a maximum of $3,000. In 1983, the regulations were amended to increase the maximum
(Cite as: 51 FR 10041, *10054)
assistance level to $3,500 for vessel purchases and also to provide grants of 15 percent of the cost, to a maximum of $2,000, for equipment purchased in P.E.I. and installed in new fishing vessels constructed off-island. The latter amendment was to provide assistance to commercial fishermen who wished to install P.E.I. supplied diesel engines in their new vessels but were ineligible for assistance through the Engine Conversion Program (see section I.C.21. of this notice). Because grants under this program were available only to vessels and equipment used by commercial fishermen, we determine that this program was limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable.
We recognize that this program terminated in 1984. However, using our grant methodology, grants bestowed from 1978 through 1984 continue to confer benefits during the review period. To calculate the benefit, we allocated those grants for equipment installed in fishing vessels over 12 years, and for fishing vessel construction over 18 years. Applying the grant methodology and dividing by the f.o.b. value of production in Atlantic Canada of fish *10055
(Cite as: 51 FR 10041, *10055)
and shellfish during the review period, we calculated an estimated net subsidy of 0.015 percent ad valorem.
20. P.E.I.: Near and Offshore Vessel Assistance Program (NOVAP)
(Cite as: 51 FR 10041, *10055)
The NOVAP was established in 1982. Similar to the vessel subsidy program described above, NOVAP provides grants for offshore vessels as well as near- shore vessels. Assistance is provided for 25 percent of the capital costs, to a maximum of $60,000, if the vessel is eligible for federal assistance, and 35 percent, to a maximum of $80,000, if ineligible. Commercial fishermen must agree to provide catch and other data and keep the vessel in the P.E.I. fishing industry for a period of 10 years. Because P.E.I. boatyards are unable to supply larger vessels, the commercial fisherman is free to purchase from any domestic or foreign supplier. Payment of the grant is made to the vessel owner upon satisfactory inspection by the DFL and presentation of paid receipts for the eligible amounts.
Because grants under this program are available only for vessels used by commercial fishermen, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable. To calculate the benefit, we allocated the grants received in fiscal years 1983 to 1985 over 18 years. Applying the grant methodology and dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.004 percent ad valorem.
(Cite as: 51 FR 10041, *10055)
21. P.E.I.: Engine Conversion Program
The Engine Conversion Program provides grants to commercial fishermen to help defray the initial costs of conversion from gasoline to diesel engines. Participation is voluntary and is available to all P.E.I. commercial fishermen with a commercial fishing license who own vessels powered by gasoline engines. Only one diesel engine conversion grant will be made per commercial fishing vessel over the life of the vessel and, as of May 21, 1982, only those diesel engines purchased from P.E.I. suppliers were eligible for assistance.
The assistance covers 25 percent of the capital cost to a maximum of $2,500 for new diesel engines installed in existing vessels with gasoline engines at least a year old. The applicant must certify that the diesel engine and related equipment will be used for commercial fishing for a minimum of five years. Payment of the grant is made to the applicant upon presentation of paid receipts for the eligible equipment and a satisfactory inspection by the DFL.
Because grants under this program are available only for vessels used by commercial fishermen, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable. To calculate the benefit from this program, we allocated the grants received in fiscal years 1983 through 1985 over 12 years. Applying the grant methodology and dividing by the f.o.b. value of production in Atlantic
(Cite as: 51 FR 10041, *10055)
Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.006 percent ad valorem.
22. P.E.I.: Commercial Fishermen's Investment Incentive Program (CFIIP)
The CFIIP, which was instituted in 1983, provides interest reduction grants to all P.E.I. commercial fishermen who are holders of bona fide fishing permits. Eligible projects include new or used capital asset purchases, acquisition of fishing enterprises and fishing privileges, repairs to capital items and working capital loans. Interest reduction grants are paid on loans secured from recognized commercial lending institutions. Upon obtaining the loan, the commercial fisherman is eligible to apply for an interest rebate of no more than four percent per annum if the lending rate is at or above 12 percent. When the lending rate falls below 12 percent, the interest rebate is reduced. The amount of the reduction is equal to the difference between the lending rate and 12 percent. The effective minimum rate to the fisherman under the program is therefore eight percent (e.g., if the secured loan has an interest rate of 11 percent, the rebate is reduced to three percent; which reduces the rate to the prescribed minimum of eight percent). Eligibility is limited to the life of the loan or the first five years, whichever is less. The maximum aggregate of loans to
(Cite as: 51 FR 10041, *10055)
individual fishing enterprises cannot exceed $30,000 at any one time. The grant is paid to the commercial fisherman upon receipt of an itemized statement from the recognized lending institution and with the certification that the borrower has paid the amount of interest due. For fishermen who were eligible to receive an interest reduction grant in 1984, payment was deferred until 1985. Grant payments were then disbursed in 1985 for the eligible amounts in both years. Because grants under this program are available only to commercial fishermen, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable. Dividing the interest reduction grants received during the review period by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.003 percent ad valorem.
23. P.E.I.: Assistance for the Construction of Icemaking and Fish Chilling Facilities (ACIFCF)
This program, established in 1974 and administered by the Department of Fisheries and Labor (DFL), provided financial assistance for the construction of storage rooms, the purchase of icemakers, temperature control equipment, and for associated installation costs. The program was available to all inshore
(Cite as: 51 FR 10041, *10055)
facilities located within P.E.I. and was formally terminated in 1983. Originally, the level of assistance was to provide for 35 percent of the cost of required construction, equipping or modification of ice-making and refrigeration facilities. This was reduced to 25 percent in 1979 and 1980. In 1981, benefits were increased to 75 percent of the total cost, up to a maximum of $75,000. Funding for the program from 1981 until its termination was provided by the P.E.I. Comprehensive Development Plan (see section I.B.2. of this notice).
Because grants under this program were available only to inshore fish processing facilities used by the fishing industry, we determine that benefits under this program were limited to a specific enterprise or industry, or group of enterprises or industries, and are countervailable. We recognize that this program terminated in 1983. However, according to our grant methodology, grants bestowed from 1974 through the program's termination confer benefits during the review period. In our preliminary determination, we based our findings on information submitted in the response stating that, of all companies which had received grants under this program, only seven exported certain fresh Atlantic groundfish to the United States during the review period. However, we were unable to verify this statement. We therefore are using, as best information available, all grants received by fishermen's cooperatives and by companies
(Cite as: 51 FR 10041, *10055)
holding fresh fish export licenses during the review period. We allocated these grants over 12 years. Applying the grant methodology and dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated *10056
(Cite as: 51 FR 10041, *10056)
an estimated net subsidy of 0.003 percent ad valorem.
24. P.E.I. Fish Box Pool Program (FBPP)
In 1975, the DFL instituted the FBPP to provide commercial fishermen with safer and more sanitary containers in which to transport their catch. These tote boxes, constructed of heavy duty plastic, were purchased by the DFL in bulk and made available to P.E.I. commercial fishermen at cost. The commercial fishermen had the option of either purchasing the boxes outright or taking out a five-year, five percent interest loan from the DFL to finance the purchase. Loans were provided under this program until 1979. In 1980, the DFL sold fish boxes to fishermen on a cash basis only. The program terminated in 1980.
In our preliminary determination, we stated that this program had been terminated. However, during verification, we obtained information which indicated that six loans under this program were still outstanding.
Because these loans were available only to commercial fishermen, we determine that they are limited to a specific enterprise or industry, or group of
(Cite as: 51 FR 10041, *10056)
enterprises or industries. In addition, because we have no information on the interest rates charged on certain loans, nor information on principal repayments for certain other loans, as best information available, we also determine that loans were provided on terms inconsistent with commercial considerations. Hence, they are countervailable.
To calculate the benefit from this program, because of the lack of information provided on interest rates or payment terms, and given the small value of loans outstanding, we are treating the outstanding balance as a grant and expensing the total during the review period. Dividing the benefit by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.002 percent ad valorem.
25. P.E.I. Technical Upgrading Program
Based on information contained in the Department of Fisheries and Labor Annual Report (P.E.I. Annual Report), we found that the government of P.E.I. operates the Technical Upgrading Program. This program provides funding to commercial fishermen and processors to attend industry meetings and receive specialized training. Because grants under this program are provided exclusively to the fishing industry, we determine that they are limited to a specific enterprise or
(Cite as: 51 FR 10041, *10056)
industry, or group of enterprises or industries, and are countervailable. To calculate the benefit from this program, because information was unavailable on expenditures during the review period, we used, as best information available, the total value of grants reported in the 1983 P.E.I. Annual Report as representing the amount disbursed during the review period. Dividing that amount by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated subsidy of 0.001 percent ad valorem.
26. P.E.I. Fresh Fish Marketing Program
Based on the information contained in the P.E.I. Annual Report, we found that the government of P.E.I. operates the Fresh Fish Marketing Program. Under this program, the DFL, in association with P.E.I. groundfish processors, entered into a contract arrangement with a New England marketing firm to market fresh P.E.I. groundfish in the New England market. Because this program promotes exports, we determine that assistance under this program confers benefits which constitute export subsidies. To calculate the benefit from this program, because information was unavailable on expenditures during the review period, we used, as best information available, the total value of financial assistance reported in the
(Cite as: 51 FR 10041, *10056)
1983 P.E.I. Annual Report as representing the amount disbursed during the review period. Dividing that amount by the f.o.b. value of production of exports of the subject merchandise to the United States during the review period, we calculated an estimated net subsidy of 0.090 percent ad valorem.
27. P.E.I. Fishing Industry Technology Program
Based on information contained in the P.E.I. Annual Report, the government of P.E.I. operates the Fishing Industry Technology Program. This program was initiated to assess opportunities for application of computer technology in the P.E.I. fishing industry. During 1984, a grant was provided to a major fish processor in Kings County for software development and training to upgrade its existing computer system. The software was designed to give better control on yield of fillets on groundfish species. Because benefits under this program are provided exclusively to the fishing industry, we determine that they are limited to a specific enterprise or industry, or group of enterprises or industries, and are countervailable. To calculate the benefit from this program, because information was unavailable on expenditures during the review period, we used, as best information available, the total value of grants reported in the 1983 P.E.I. Annual Report as representing the amount disbursed during the review period. Dividing that
(Cite as: 51 FR 10041, *10056)
amount by the f.o.b. value of production in Atlantic Canada of the subject merchandise during the review period, we calculated an estimated net subsidy of 0.012 percent ad valorem.
28. P.E.I. Technology Improvements Program
Based on information contained in the P.E.I. Annual Report, we found that the government of P.E.I. operates the Technology Improvements Program. This program provides financial assistance to processing firms for leasing particular machinery on a trial basis to assess the suitability and economic benefit to the firm's operations. During the 1984 fishing season, three plants participated in the program. Two of the machines tested were a groundfish filleting line and a skinning machine. In addition, three fish unloading systems were purchased by the DFL and were leased to the industry on a trial basis during 1984.
Because grants under this program are provided exclusively to the fishing industry, we determine that they are limited to a specific enterprise or industry, or group of enterprises or industries. In addition, because we have no information on the terms of the assistance provided, nor on the leasing arrangements entered into, we determine that the provision of these benefits is inconsistent with commercial considerations, and is therefore countervailable.
(Cite as: 51 FR 10041, *10056)
To calculate the benefit from this program, because information was unavailable on expenditures during the review period, we used, as best information available, the total value of assistance reported in the 1983 P.E.I. Annual Report as representing the amount of a grant disbursed during the review period. Dividing that amount by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.002 percent ad valorem.
29. P.E.I. Onboard Fish Handling Systems Program
Based on information contained in the P.E.I. Annual Report, the government of P.E.I. operates the Onboard Fish Handling Systems Program. The government provides assistance to commercial vessel owners at the rate of 25 percent of the installed capital cost, to a maximum of $10,000, for onboard *10057
(Cite as: 51 FR 10041, *10057)
fish gutting machinery and fish cooling units. According to the 1984 P.E.I. Annual Report, two grants were given to vessel owners in 1982. No applications for assistance were received in 1983 or 1984.
Because benefits under this program are provided exclusively to the fishing industry, we determine that they are limited to a specific enterprise or industry, or group of enterprises or industries, and are countervailable. To calculate the benefit from this program, because information was unavailable on
(Cite as: 51 FR 10041, *10057)
expenditures during the review period or for prior years, we used, as best information available, the total value of grants reported in the 1984 P.E.I. Annual Report as representing the amount disbursed during the review period. Dividing that amount by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.001 percent ad valorem.
30 Quebec: Vessel Construction Assistance Program (VCAP)
Under the direction of the Ministry of Agriculture, Fisheries and Food (MAFF), the government of Quebec operates the VCAP. This program, which was established in 1972 and originally administered by the Ministry of Industry, Commerce and Tourism, provides grants to commercial fishermen to reimburse a portion of the cost of a boat. Only boats measuring between 25 and 35 feet that are constructed with materials from Quebec and equipped with storage containers which correspond to the regulations of the Quebec Standards Bureau qualify under the VCAP. If the commercial fisherman sells the boat within five years without MAFF authorization, a prorated portion of the grant must be repaid.
Because grants under this program are available only for vessels used by commercial fishermen, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is
(Cite as: 51 FR 10041, *10057)
countervailable. To calculate the benefit from this program, we allocated the grants received in fiscal years 1981 through 1985 over 18 years. Grants were first provided under this program in 1972. However, no information on the grants bestowed from 1972 through 1980 was available. Therefore, for each of those years, we used, as best information available, the average value of the grants bestowed during the period 1981-1985, and allocated those grants over 18 years as well. Applying the grant methodology and dividing by f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subisdy of 0.028 percent ad valorem.
31. Quebec: Gear Subsidy Program (GSP)
Under the direction of MAFF, the government of Quebec operates the GSP. This program, which was established in 1972 and originally administered by the Ministry of Industry, Commerce and Tourism, provides grants to commercial fishermen to reimburse 25 percent of the purchase price of hooks, leaders, lines and metallic shellfish traps. To be eligible for this program, fishermen must purchase materials from Quebec suppliers for the construction of the gear. Because benefits under this program are available only for gear used by commercial fishermen, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is
(Cite as: 51 FR 10041, *10057)
countervailable. To calculate the benefit from this program, we allocated the grants received in fiscal years 1981 through 1985 over 12 years. Grants were first provided under this program in 1972. However, no information on the grants bestowed from 1972 through 1980 was available. Therefore, for each of those years, we used, as best information available, the average value of the grants bestowed during fiscal years 1981-1982 as representing the value of grants bestowed from 1972 through 1980, and allocated those grants over 12 years as well. We used the average for only these two years because in 1982 certain gear purchases became ineligible. Grants in years prior to 1980 are more accurately reflected by the average for fiscal years 1981-1982. Applying the grant methodology and dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.041 percent ad valorem.
32. Quebec: Insurance Premium Subsidy Program (IPSP)
Under the direction of MAFF, the government of Quebec operates the IPSP. This program, established in 1981, provides reimbursements to eligible participants equal to 50 percent of the cost of fishing vessel insurance. Benefits are available to professional harvesters who own fishing vessels and to fishing corporations whose members conduct fishing operations. If the harvester
(Cite as: 51 FR 10041, *10057)
transfers or sells the boat or if the insurance is prematurely cancelled, a prorated portion of the grant must be repaid to MAFF. Respondents contend that benefits provided under the IPSP do not constitute countervailable benefits because there is no preferential treatment for the fishing industry. They claim that the fishing industry is considered just one of the "agro-alimentary" industries overseen by MAFF, and that programs providing similar benefits are available for 58 crops.
The programs referred to by the respondents are administered by the Regie des Assurances Agricoles du Quebec (the Regie), in accordance with the Crop Insurance Act. Under that Act, the government of Quebec may issue regulations establishing insurance schemes for mixed farming and commercial crops. Funding for the insurance schemes is provided jointly by the government of Quebec and the participating farmers on an equal basis. Only those crops for which specific regulations have been enacted are covered by an insurance scheme run by the Regie; coverage is not available for all crops, nor is it available to other industries in the agriculture sector (e.g., livestock). By definition, benefits under the Crop Insurance Act are limited to a specific group of industries.
Similarly, under the IPSP, benefits are limited exclusively ot the fishing industry. There is no evidence that this program is part of a broader government of Quebec policy to provide comparable benefits to all industries in
(Cite as: 51 FR 10041, *10057)
the "agro-industrial" sector. Therefore, we determine this program to be limited to a specific enterprise or industry, or group of enterprises or industries, and to be countervailable. Dividing the value of the premium reimbursements to the fishing industry during the review period by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.043 percent ad valorem.
33. Quebec: Large Vessel Construction Program
Based on information contained in the Annual Report of the Ministry of Agriculture, Fisheries and Food, the government of Quebec also provides grants for the construction of boats measuring more than 35 feet. Originally, grants covered 35 percent of construction costs, but in 1984 individual grants were increased to 50 percent of costs. A commercial fisherman is required to demonstrate that 75 percent of earned income derives from fishing and undertake to use the vessel in fishing operations for a minimum of five years. Because grants under this *10058
(Cite as: 51 FR 10041, *10058)
program are provided only to commercial fishermen, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable.
According to our grant methodology, we would normally take financial data for the last 18 years, the average useful life of boats, and allocate grants in
(Cite as: 51 FR 10041, *10058)
each year over an 18 year period. However, because financial data were unavailable for years other than 1983-84, we used, as best information available, the total grants disbursed in 1983-84 as representing the amount disbursed during the review period, and expensed the full amount to the year of receipt. Dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.144 percent ad valorem.
34. Quebec: Loans From the Ministry of Agriculture, Fisheries and Food
Based on information contained in the Annual Report for the Ministry of Agriculture, Fisheries and Food, the government of Quebec offers loans to commercial fishermen for the construction of new vessels, repair of used vessels and equipment, and consolidation of debt. Because benefits under this program are available only to commercial fishermen, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries. In addition, because information was not provided on the terms or interest rates of these loans, we also determine that these loans were provided on terms inconsistent with commercial considerations, and are, therefore, countervailable.
No financial data were available on the amounts of loans disbursed in any year
(Cite as: 51 FR 10041, *10058)
other than 1983-84. Therefore, to calculate the benefit from this program, we used, as best information available, the amount of funds disbursed in 1983-84 as representing a short-term interest-free loan provided during the review period. We used as our benchmark the 90-day prime corporate paper rate. Dividing the benefit by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.045 percent ad valorem.
35. Quebec: Grants for Engine Purchases
Based on information contained in the Annual Report for the Ministry of Agriculture, Fisheries and Food, the government of Quebec provides grants to commercial fishermen for the purchase of engines for boats measuring less than 35 feet. Because grants under this program are provided only to commercial fishermen, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable. Using our grant methodology, we would normally take financial data for the last 12 years, the average useful life of equipment, and allocate grants in each year over a 12 year period. However, because financial data were unavailable for years other than 1983-84, we used, as best information available, the total grants disbursed in 1983-84 as representing the amount
(Cite as: 51 FR 10041, *10058)
disbursed during the review period, and expensed the full amount to the review period. Dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.021 percent ad valorem.
36. Quebec: Grants for Fish Transport and Seafood Processing Tanks
Based on information contained in the Annual Report for the Ministry of Agriculture, Fisheries and Food, the government of Quebec provides financial assistance for fish transport and the purchase of processing tanks. Grants over 50 percent of the acquisition costs of approved tanks and reservoirs. Because this program provides benefits exclusively to the fishing industry, we determine that it is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable. According to our grant methodology, we would normally take financial data for the last 12 years, the average useful life of equipment, and allocate grants in each year over a 12 year period. However, because financial data were unavailable for years over than 1983-84, we used, as best information available, the total grants disbursed under this program in 1983-84 as representing the amount disbursed during the review period. We then expensed the full amount to the review period. Dividing by the f.o.b. value of
(Cite as: 51 FR 10041, *10058)
production in Atlantic Canada of fish and shellfish during the review period, we calculated an estimated net subsidy of 0.029 percent ad valorem.
37. Quebec: Grants to Processing Enterprises for Capital Equipment
Based on information contained in the Annual Report for the Ministry of Agriculture, Fisheries and Food, we found that the government of Quebec will assume 20 percent of the cost of eligible capital equipment for processing firms wishing to modernize their plants in conformance with construction and operation standards set forth in the Agricultural, Marine and Food Products Act. Because these grants are available only to the fishing industry, we determine that this program is limited to a specific enterprise or industry, or group of enterprises or industries, and is countervailable.
According to our grant methodology, we would normally take financial data for the last 12 years, the average useful life of equipment, and allocate grants in each year over a 12 year period. However, because financial data were unavailable for years other than 1983-84, we used, as best information available, the total grants disbursed under this program in 1983-84 as representing the amount disbursed during the review period and expensed the full amount to the review period. Applying this methodology and dividing by the f.o.b. value of production in Atlantic Canada of fish and shellfish during