Also known as:subsidies · government subsidy · grant · state aid
Written by attorneys · grounded in primary & secondary sources — see below
A grant usually made by the government to an enterprise whose promotion is considered to be in the public interest. Subsidies may take the form of direct payments such as cash grants or indirect benefits including research-and-development support, tax breaks, provision of raw materials at below-market prices, or low-interest loans guaranteed by a government agency.
Sources & Authorities· 30 primary sources
Select any source to read its text and confirm it supports the definition.
Cases
Statutes
How it applies
Common Examples
6
Congressional Spending for Industry Research
Congress enacts legislation directing funds to Silverline Industries to develop advanced materials for national infrastructure projects. The company receives the payments after demonstrating that the work advances the general welfare. Silverline uses the funds to expand its facilities and hire additional engineers.
New Trial After Subsidy Fraud Conviction
Spencer Silver is convicted of submitting false reports to obtain a federal research subsidy. After the verdict, newly discovered documents show the reports were accurate. The court vacates the judgment and orders a new trial in the interest of justice.
Sylvia Santos seeks maintenance following dissolution of her marriage. Her former spouse had received a state subsidy for a failing business that is now discontinued. The court finds Sylvia lacks sufficient property and cannot support herself through employment, so it grants the maintenance order.
Creditor Execution on Partner Subsidy
A judgment creditor obtains permission to levy against a partner's personal assets after showing that partnership assets, including a government operating subsidy, are clearly insufficient to satisfy the debt. The court determines that exhaustion of partnership assets would be excessively burdensome.
Reliance on Erroneous Subsidy Regulation
Sterling Dynamics accepts a state subsidy after relying on an official administrative interpretation later held invalid. The company had no reason to doubt the statement at the time of acceptance. The court finds the reliance reasonable and excuses any resulting liability.
Execution Against General Partner Assets
A judgment creditor seeks to reach a general partner's assets after a limited partnership's subsidy-funded project fails. The court grants permission upon finding that partnership assets are clearly insufficient and that exhaustion would impose excessive burden.
Common questions
Frequently Asked
3
What forms can a government subsidy take?+
Subsidies may consist of direct cash payments or indirect benefits such as tax breaks, below-market raw materials, research support, or government-guaranteed low-interest loans.
Supporting sources
When is a foreign subsidy considered countervailable?+
The supplied source defines subsidy only in domestic terms as a government grant promoting the public interest and does not address foreign subsidies or countervailability.
Supporting sources
Does the definition of subsidy include grants to private enterprises?+
Yes. The term covers grants made to any enterprise whose promotion serves the public interest, whether the grant is direct or indirect.
Supporting sources
5 U.S. (1 Cranch) 137 (1803)Property
…The discretion of a court is a legal discretion, not arbitrary; if the applicant makes out a proper case the court are bound to grant it. Mr. Lee read the affidavit of Hazen Kimball stating that on 3 March 1801 he was a clerk in the Department of State and that there were in the office commissions made out and signed by…