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WTO ANALYTICAL INDEX: SUBSIDIES AND COUNTERVAILING MEASURES

Agreement on Subsidies and Countervailing Measures

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> General
> Article 1
> Article 2
> Article 3
> Article 4
> Article 5
> Article 6
> Article 7
> Article 8
> Article 9
> Article 10
> Article 11
> Article 12
> Article 13
> Article 14
> Article 15
> Article 16
> Article 17
> Article 18
> Article 19
> Article 20
> Article 21
> Article 22
> Article 23
> Article 24
> Article 25
> Article 26
> Article 27
> Article 28
> Article 29
> Article 30
> Article 31
> Article 32
> Annex I
> Annex II
> Annex III
> Annex IV
> Annex V
> Annex VI
> Annex VII
> Relationship with other WTO Agreements
> Declaration on Dispute Settlement Pursuant to the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade or Part V of the Agreement on Subsidies and Countervailing Measures

 

> Analytical Index main page


Table of contents    back to top

I. General    back to top

A. Object and Purpose of the SCM Agreement


II. Article 1     back to top

A. Text of Article 1
B. Interpretation and Application of Article 1

1. General

(a) Distinction between “financial contribution” and “benefit”

2. Article 1.1(a)(1): “financial contribution”

(a) General

(b) “by a government or any public body”

(i) “Public body”

(ii) Financial contribution “by” individual public entities or private bodies

(c) Article 1.1(a)(1)(i): transfer of funds

(i) “a government practice”

(ii) “direct transfer of funds”

(iii) “potential direct transfers of funds”

(d) Article 1.1(a)(1)(ii): “government revenue otherwise due is foregone or not collected”

(e) Article 1.1(a)(1)(iii): a government provides goods or services other than general infrastructure, or purchases goods

(i) General

(ii) “provides”

(iii) “goods”

(iv) “other than general infrastructure”

(v) Purchases of services

(f) Article 1.1(a)(1)(iv): entrustment or direction of private bodies

3. Article 1.1(b): “benefit is thereby conferred”

(a) “benefit”

(i) benefit to recipient vs. cost to government

(ii) Advantage vis-a-vis the market

(iii) The relevant recipient — scope of the SCM Agreement

(iv) Evidence establishing the existence of benefit

(b) “is … conferred”

(i) General

(ii) Mandatory/discretionary conferral of a benefit

(c) Pass-through of benefit: changes in ownership

(d) Pass-through of benefit: subsidized inputs

(e) Pass-through: sales of the subsidized product to unrelated buyers

(f) Rebuttal of a prima facie case of benefit

(g) Relationship with other Articles

(i) Article 14

(ii) Article 14(c)

(iii) Annex I, item (k)

(iv) Annex IV

4. Relationship of Article 1.1 with other Articles

(i) Footnote 1 and Footnote 59

5. Relationship with other WTO Agreements

(a) Article XVI of the WTO Agreement

 
III. Article 2     back to top

A. Text of Article 2
B. Interpretation and Application of Article 2

1. Article 2

(a) General

(b) “certain enterprises”

(c) Individual payments under a generalized programme necessarily specific?

2. Article 2.1(a): “explicitly limits”

3. Article 2.1(c): de facto specificity

(a) General

(b) “other factors may be considered”

(c) “account be taken of”

(d) “disproportionately large”

(e) “predominant use”

4. Article 2.2: regional specificity

5. Article 2.3: subsidies falling under Article 3 deemed to be specific

 
IV. Article 3     back to top

A. Text of Article 3
B. Interpretation and Application of Article 3

1. “Except as provided in the Agreement on Agriculture”

2. Article 3.1(a)

(a) General

(b) “contingent in law … upon export performance”

(c) “contingent … in fact … upon export performance”

(i) De facto contingency

(ii) Treatment of facts in the determination of de facto export contingency

(d) “Export performance”

(i) General

(ii) “produced within or outside the Member”

(e) Relationship with other Articles

(i) Article 4.7

(ii) Article 27

(iii) Footnote 59

(f) Annex VII(b)

(g) Footnote 4

3. Article 3.1(b)

(a) “subsidies contingent … upon the use of domestic over imported goods”

(i) Contingency

(ii) De facto contingency

(b) Relationship with other Articles

(i) Chapeau of Article 3.1

(ii) Article 3.1(a)

(iii) Article 27

(c) Relationship with other Agreements

(i) Agreement on Agriculture

 
V. Article 4     back to top

A. Text of Article 4
B. Interpretation and Application of Article 4

1. General

(a) Accelerated procedure and the deadline for the submission of new evidence, allegations and affirmative defences

2. Article 4.2

(a) “include a statement of available evidence”

(b) Relationship with other WTO Agreements

3. Article 4.3

(a) “shall be to clarify the facts of the situation”

4. Article 4.4

(a) Relationship between the matter before a panel as defined by its terms of reference and the matter consulted upon

(b) Relationship with other WTO Agreements

5. Article 4.5

(a) Relationship with other Articles

6. Article 4.7

(a) “withdraw the subsidy”

(b) Time-period for withdrawal of measures

(c) Relationship with other Articles

(i) Article 7.8

(ii) Article 19.1

(d) Relationship with other WTO Agreements

(i) DSU

(ii) Agreement on Agriculture

7. Article 4.9

8. Article 4.10

(a) Meaning of “appropriate countermeasures”

(i) Countermeasures

(ii) “appropriate”

(iii) Same meaning in Articles 4.10 and 4.11

(b) Purpose of countermeasures under Article 4.10

(c) Amount of subsidy as the basis for the calculation of countermeasures

(i) General

(ii) Exception to the requirement of equivalence to level of nullification or impairment

(iii) Factors relevant for the calculation of countermeasures

(d) Relationship with other Articles

(e) Relationship with other WTO Agreements

(i) DSU

9. Article 4.11

(a) Task of the Arbitrators under Article 4.11

(b) Article 4.11 provisions as special or additional rules

(c) Burden of proof

(d) Treatment of data supplied by private entities

(e) Relationship with other provisions

(i) SCM Agreement

(ii) DSU

 
VI. Article 5     back to top

A. Text of Article 5
B. Interpretation and Application of Article 5

1. General

(a) Elements of a claim under Article 5

(b) Temporal scope of Article 5

(c) No requirement of “continuing” benefit

(d) No requirement of “pass-through” in a claim under Article 5 of the SCM Agreement

(e) Reference period for determining whether subsidies cause adverse effects

2. Article 5(a): injury to the domestic industry

3. Article 5(b): “nullification or impairment”

(a) General

(b) Application of a measure

(c) Existence of a benefit

(d) Nullification or impairment of a benefit

4. Article 5 (c)

(a) “serious prejudice”

(b) “another Member”

(c) Standing as complainant

5. Relationship with other Articles

(a) Article 6.3(c)

(b) Article 7.1

 
VII. Article 6     back to top

A. Text of Article 6
B. Interpretation and Application of Article 6

1. Article 6.1

(a) Expiry of Article 6.1

(b) Relationship with other Articles

(i) Article 27

(ii) Article 31

2. Article 6.3

(a) General

(i) “Serious prejudice … may arise”

(ii) “the effect of the subsidy”

(b) Forms of serious prejudice

(i) “displaces” or “impedes”

(ii) “significant”

(iii) “price undercutting”

(iv) “price suppression”

(v) “price depression”

(vi) “lost sales”

(vii) “in the same market”

(viii) “increase in the world market share”

 
VIII. Article 7     back to top

A. Text of Article 7
B. Interpretation and Application of Article 7

1. Article 7.8

(a) General

(b) Relationship with other Articles

(i) Article 4.7

2. Article 7.9 and 7.10

(a) Meaning of “countermeasures … commensurate with the degree and nature the adverse effects determined to exist”

(i) “countermeasures”

(ii) “commensurate with the degree and nature”

(iii) “the adverse effects determined to exist”

(b) Purpose of countermeasures under Article 7.9

(c) Task of the Arbitrators

(d) Burden of proof

(e) Article 7.9 provisions as special or additional rules

(f) Relationship with other Articles

(i) Article 4.10

 
IX. Article 8     back to top

A. Text of Article 8
B. Interpretation and Application of Article 8

1. General

(a) Expiry of Article 8

(b) The Doha Round

2. Article 8.2

(a) Article 8.2(a)

(b) Relationship with other Articles

(i) Article 8.3

3. Article 8.3

(a) “notified”

(b) “updates of … notifications”

4. Article 8.5

(a) Procedures for arbitration

5. Relationship with other Articles

 
X. Article 9     back to top

A. Text of Article 9
B. Interpretation and Application of Article 9

1. Expiry of Article 9

2. Relationship with other Articles

 
XI. Article 10     back to top

A. Text of Article 10
B. Interpretation and Application of Article 10

1. The Doha review mandate

2. Footnote 36

(a) “offsetting”

(b) “any subsidy bestowed directly or indirectly upon the manufacture”: pass-through of benefit from subsidized inputs

3. Footnote 37: “initiated”

4. Relationship with Article VI of the GATT 1994

(a) Combined application of Article VI of the GATT 1994 and the SCM Agreement

(b) Pass-through: subsidized inputs

5. Relationship with other Articles

 
XII. Article 11     back to top

A. Text of Article 11
B. Interpretation and Application of Article 11

1. Article 11.2

(a) “caused by subsidized imports”

2. Article 11.4

(a) “by or on behalf of the domestic industry”

(i) Requirement to make a determination

(ii) exclusive reliance on information in the application

(b) Relationship with Article 5.4 of the Anti-Dumping Agreement

3. Article 11.6

(a) Non-application of self-initiation standard to sunset reviews under Article 21.3

4. Article 11.9

(a) Non-application of “de minimis” standard to sunset reviews under Article 21.3

(b) Exclusion of exporters from subsequent administrative and changed circumstances reviews

5. Article 11.11

(a) “in no case more than 18 months”

 
XIII. Article 12     back to top

A. Text of Article 12
B. Interpretation and Application of Article 12

1. General

2. Article 12.1

(a) “information which the authorities require”

(b) Article 12.1.1: 30-day deadline for questionnaire replies

3. Article 12.4.1

(a) summaries shall be in sufficient detail to permit a reasonable understanding of substance of confidential information

(b) statement of the reasons why summarization is not possible

4. Article 12.6

(a) Verification Meetings

5. Article 12.7

6. Article 12.8

7. Article 12.9

(a) “interested party”

(b) “allowing domestic or foreign parties other than those mentioned above to be included as interested parties”

(c) Relationship with Article 12.7 of the SCM Agreement

 
XIV. Article 13     back to top

A. Text of Article 13
B. Interpretation and Application of Article 13

 
XV. Article 14     back to top

A. Text of Article 14
B. Interpretation and Application of Article 14

1. General

2. Article 14(a): “usual investment practice … of private investors”

(a) General

(b) Relevance of distinction between inside investor vs. outside investor

3. Article 14(b): loans

4. Article 14(c): loan guarantees

5. Article 14(d): provision of goods or services and purchases of goods

(a) “in relation to prevailing market conditions for the good or service in question in the country of provision”

(b) Prior subsidization in the relevant market

 
XVI. Article 15     back to top

A. Text of Article 15
B. Interpretation and Application of Article 15

1. Article 15.1

(a) Interpretation and Application

(b) Selection of the period of investigation

2. Footnote 46

(a) “characteristics closely resembling”

3. Article 15.2

(a) “Significant” increase in subsidized imports

(b) Treatment of imports from companies which merged

(c) Price effect

(d) Period of data collection

4. Article 15.4

(a) Consideration of all relevant economic factors

(b) Relationship with Article 16

5. Article 15.5

(a) “through the effects of subsidies” / footnote 47

(b) Non-attribution of injury caused by other factors

6. Article 15.8

 
XVII. Article 16     back to top

A. Text of Article 16
B. Interpretation and Application of Article 16

1. “producers”

 
XVIII. Article 17     back to top

A. Text of Article 17
B. Interpretation and Application of Article 17

 
XIX. Article 18     back to top

A. Text of Article 18
B. Interpretation and Application of Article 18

 
XX. Article 19     back to top

A. Text of Article 19
B. Interpretation and Application of Article 19

1. General

2. Article 19.1

(a) “through the effects of the subsidy”

(b) Relationship with other Articles

(i) Article 4.7

(ii) Article 19.4

3. Article 19.3

(a) Right to an expedited review

(i) General

(ii) Aggregated investigations

(b) “appropriate amounts” and possible double remedies

4. Article 19.4

(a) General

(b) “found to exist” — continued existence of benefit at the time of imposition

(c) Relationship with other Articles

 
XXI. Article 20     back to top

A. Text of Article 20
B. Interpretation and Application of Article 20

1. Retroactive application of countervailing duties

2. Relationship between paragraphs 1, 2 and 6 of Article 20

3. Relationship with other Articles

(a) Articles 17.3 and 17.4

 
XXII. Article 21     back to top

A. Text of Article 21
B. Interpretation and Application of Article 21

1. Article 21.1

(a) Temporal application

(b) Relationship with other Articles

2. Article 21.2

(a) General

(b) Types of review under Article 21.2

(c) Reviews not yet requested

(d) “necessary to offset subsidization”

(e) Exhaustiveness of the conditions listed

3. Article 21.3

(a) Self-initiation of sunset reviews

(i) General

(ii) Evidentiary requirements for self-initiation of sunset reviews

(iii) De minimis standard

(b) Determination of likelihood of continuation/recurrence of subsidization

(i) General

(ii) Sufficient factual basis for the non-determination

(c) Relationship with other paragraphs of Article 21

(i) Articles 21.2 and 21.4

(d) Relationship with other Articles

(i) Article 11.6

(ii) Article 11.9

(e) Relationship with other WTO Agreements

 
XXIII. Article 22     back to top

A. Text of Article 22
B. Interpretation and Application of Article 22

1. Article 22.1 and 22.7

2. Article 22.5

3. Relationship with other Articles

 
XXIV. Article 23     back to top

A. Text of Article 23
B. Interpretation and Application of Article 23

 
XXV. Article 24     back to top

A. Text of Article 24
B. Interpretation and Application of Article 24

1. Rules of procedure

2. Subsidiary bodies

(a) Permanent Group of Experts (PGE)

(b) Informal Group of Experts (IGE)

(c) Working Party on Subsidy Notifications

 
XXVI. Article 25     back to top

A. Text of Article 25
B. Interpretation and Application of Article 25

1. General

(a) Questionnaire format for subsidy notifications

(b) Periodicity of submission and review of subsidy notifications

(c) Written procedure

2. Article 25.7

3. Article 25.11

(a) “shall report … all preliminary or final actions”

(b) “semi-annual reports”

(c) “nil” notifications under Article 25.11 and 25.12

(d) Relationship with other Articles

(i) Article 27.4

 
XXVII. Article 26     back to top

A. Text of Article 26
B. Interpretation and Application of Article 26

 
XXVIII. Article 27     back to top

A. Text of Article 27
B. Interpretation and Application of Article 27

1. General

(a) Relationship with item (k) of the Illustrative List

2. Article 27.2

(a) “subject to compliance with the provisions in paragraph 4”

(b) Exception for LDCs

(c) Relationship with other Articles

(i) Article 3.1(a)

(ii) Article 27.3

(iii) Article 27.4

(iv) Article 27.7

3. Article 27.3

(a) General

(b) Termination of transition period

(c) Relationship with other Articles

(d) Relationship with other WTO Agreements

4. Article 27.4

(a) “shall phase out its export subsidies”

(b) “a developing country Member shall not increase the level of its export subsidies”

(i) “granting” of subsidies for the purposes of Article 27.4

(ii) Constant or nominal values

(iii) Benchmark period

(iv) Actual expenditures or budgeted amounts

(c) Footnote 55

(d) “use of subsidies inconsistent with its development needs”

(e) Burden of proof

(f) Extension of Article 27.4 transition period

(g) Relationship with other Articles

5. Articles 27.5 and 27.6

(a) Export competitiveness

(b) Review of the operation of Article 27.6

(c) Period for establishment of export competitiveness under Article 27.5

6. Article 27.7

(a) Relationship with other Articles

7. Article 27.8

(a) “in accordance with the provisions of paragraphs 3 through 8 of Article 6”

8. Article 27.9

9. Article 27.10

10. Article 27.11

(a) “notified”

11. Article 27.13

(a) “notified”

 
XXIX. Article 28     back to top

A. Text of Article 28
B. Interpretation and Application of Article 28

1. Article 28.1

(a) “inconsistent with the provisions of this Agreement”

 
XXX. Article 29     back to top

A. Text of Article 29
B. Interpretation and Application of Article 29

 
XXXI. Article 30     back to top

A. Text of Article 30
B. Interpretation and Application of Article 30

1. Articles of the SCM Agreement invoked in panel and Appellate Body proceedings

2. Standard of review under the SCM Agreement

 
XXXII. Article 31     back to top

A. Text of Article 31
B. Interpretation and Application of Article 31

1. Review of Articles 6.1, 8 and 9

 
XXXIII. Article 32     back to top

A. Text of Article 32
B. Interpretation and Application of Article 32

1. Article 32.1

(a) “in accordance with the provisions of GATT 1994, as interpreted by this Agreement”

(b) “specific Action against a subsidy”

(c) Relationship with other Articles

(i) Article 10

(ii) Article 14

2. Article 32.3

(a) Transitional rule

(b) “this Agreement”

(c) “investigations”

(d) “reviews of existing measures”

3. Article 32.5

(a) “to ensure … the conformity of its laws … with the provision of this Agreement”

4. Article 32.6

5. Article 32.7

  
XXXIV. Annex I     back to top

A. Text of Annex I
B. Interpretation and Application of Annex I

1. Items (c), (d), (j) and (k)

(a) “Provided or mandated by governments”

2. Item (d)

3. Items (e), (f), (g), (h) and (i)

4. Footnote 59 of Item (e)

(a) Fifth Sentence: “double taxation of foreign source-income”

(i) Scope of application

(ii) Scope of discretion to avoid double taxation

(iii) Design, structure and architecture of double taxation to target foreign source income

(b) “foreign source income”

(i) Recourse to international tax law

(ii) Link between income of taxpayers and their activities in a foreign State

(c) Burden of proof

(d) Relationship with other Articles

5. Item (j)

(a) General

(b) The definition of the terms

(i) “export credit guarantee … programmes”

(ii) “premiums”

(iii) “are inadequate to cover”

(iv) “long-term”

(v) “operating costs and losses”

(c) Application of item (j)

6. Item (k)

(a) First paragraph of item (k) — “material advantage” clause

(i) General

(ii) “payments of all or part of the costs incurred by exporters or financial institutions in obtaining credits”

(iii) “used to secure a material advantage”

(b) First paragraph of item (k) as an affirmative defence

(c) Second paragraph of item (k) — “the safe haven”

(i) General

(d) “in the field of export credit terms”

(e) “international undertaking on official export credits”

(f) “a successor undertaking”

(g) OECD Arrangement

(h) “export credit practice”

(i) “in conformity” with “interest rates provisions”

(i) “interest rate provisions”

(ii) “in conformity”

(j) Burden of proof

(i) Second paragraph of item (k) as an affirmative defence

(ii) “Matching of a derogation”

(iii) Mandatory/discretionary distinction in the context of an affirmative defence under item (k) second paragraph

(k) Relationship with other Articles

 
XXXV. Annex II     back to top

A. Text of Annex II
B. Interpretation and Application of Annex II

1. Footnote 61

 
XXXVI. Annex III     back to top

A. Text of Annex III
B. Interpretation and Application of Annex III

1. Relationship with other Articles

(a) Article 3.1(a)

(b) Article 27.2(a)

 
XXXVII. Annex IV     back to top

A. Text of Annex IV
B. Interpretation and Application of Annex IV

1. Expiry

2. Relationship with other Articles

 
XXXVIII. Annex V     back to top

A. Text of Annex V
B. Interpretation and Application of Annex V

1. General

2. Use of information gathered under Annex V for prohibited subsidy claims

3. Whether Annex V procedure initiated

4. Adverse inferences from non-cooperation

 
XXXIX. Annex VI     back to top

A. Text of Annex VI
B. Interpretation and Application of Annex VI

 
XL. Annex VII     back to top

A. Text of Annex VII
B. Interpretation and Application of Annex VII

1. Annex VII(b)

(a) Rectification to include Honduras

(b) Graduation methodology

(c) Re-inclusion of Member in Annex VII(b)


XLI. Relationship with other WTO Agreements     back to top

A. GATT 1994

1. Article III

(a) Absence of conflict between the SCM Agreement and Article III of GATT 1994

(b) Absence of conflict between the SCM Agreement and Article III:2 of GATT 1994

2. Article VI

3. Article XVI

B. TRIMS Agreement
C. DSU

1. Article 3.8

2. Article 4

3. Article 11

4. Article 13.2

5. Article 23.1

D. Agreement on Agriculture
E. GATT Subsidies Code

 
XLII. Declaration on Dispute Settlement Pursuant to the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade or Part V of the Agreement on Subsidies and Countervailing Measures     back to top

A. Text of Declaration
B. Interpretation and Application

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