SUBSIDIES

REPLIES TO QUESTIONS POSED BY AUSTRALIA[1] REGARDING

THE NEW AND FULL NOTIFICATION OF NORWAY[2]

The following communication, dated and received on 24 June 2025, is being circulated at the request of the delegation of Norway.

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Australia has sent a request for information regarding the 2023 subsidy notification of Norway. Please see the answers from Norway to the questions from Australia, below.

7.3 Carbon tax compensation scheme

The notification indicates that the compensation scheme following the move to a full carbon tax on fuel to fishing vessels is to incentivise more fuel-efficient fisheries.

Question 1

Could Norway please clarify how the subsidy is calculated.

Reply:

To reduce the fleet's carbon footprint, Norway has had in place a carbon tax on fossil fuel for fisheries since 2020. Vessels can apply for compensation for the carbon-tax the following year (in 2025 for 2024). The arrangement means that individual vessels are compensated according to their share of the first-hand value of the catch within their vessel group. To be more precise - it refers to the first‑hand value of catch among those vessels that actually apply for the compensation (some vessels will always miss out). Altogether three vessel groups have been established in order to make the competition between the vessels fair: coastal vessels, offshore vessels, and coastal shrimp trawlers. The total compensation in 2024 is less than 50% of the total carbon tax paid by the fishing fleet as such.

Question 2

What is meant by "vessels with a high turnover will be better off while vessels with a lower turnover will benefit less from this system"?

Reply:

The available amount of subsidy in the compensation scheme might differ from year to year depending on what the Parliament decides to grant. Vessels applying for compensation will share the available amount of subsidy. The share of each vessel group are as follows:

Offshore vessels: 63,1%

Coastal vessels: 31%

Coastal shrimp trawlers: 5,9%

The Directorate of Fisheries will calculate the relevant turnover for each vessel. Only catches taken with fuel purchased with Norwegian carbon tax is compensated. Thereafter another body (Garantikassen for fiskere), will conduct the calculation for each vessel based on its share of the total turnover in its group. If a vessel's turnover constitutes 1% of the turnover (the first-hand value in the group it belongs to), it will receive 1% of the amount granted to that particular vessel group. The incentive behind this "competition" is to stimulate the vessels towards a more fuel-efficient fishery in contrast to the former reimbursement scheme which was based on the actual consumption of fuel.

Question 3

Compensation is according to an individual vessel's share "of the first hand value within their vessel group". Could Norway please clarify this statement of how compensation is assessed.

Reply:

Please see the explanation above.

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