"Non-actionable subsidies" or "green subsidies" "Non-actionable subsidies" or "green subsidies" are those which are permitted as they are of a general nature, i.e., applied across-the-board to all industries and not limited to a specific industry or enterprise or group of enterprises or industries. Subsidy, under this category, cannot be subjected to either countervailing measures or other disciplines under the Agreement.

Examples:

- For research activities conducted by firms;

- To adapt existing production facilities to new environmental requirements; and

-  To assist in the development of industries in disadvantaged regions, provided that such assistance is not directed to specific enterprises or industries within the region.

"Prohibited subsidies" or "red subsidies," "Prohibited subsidies" or "red subsidies," on the other hand, include export subsidies, i.e., those that are contingent on export performance, and subsidies that are contingent on the use of domestic over imported goods. An importing country alleging this kind of subsidy can avail of remedy measures by bringing the matter before the WTO Dispute Settlement Body for redress.

Examples:

-  Direct subsidies based on export performance;

-  Currency retention schemes involving a bonus on exports;

-  Provision of subsidized inputs for use in the production of exported goods;

-  Exemption from direct taxes (e.g., tax on profits related to exports);

-  Exemption from, or remission of, indirect taxes (e.g., VAT) on exported products in excess of those borne by these products when sold for domestic consumption;

-  Remission or drawback of import charges (e.g., tariffs and other duties) in excess of those levied on inputs consumed in the production of exported goods;

-  Export guarantee programs at premium rates inadequate to cover the long-term costs of the program; and

-  Export credits at rates below the government’s cost of borrowing, where they are used to secure a material advantage in export credit terms.