WORLD TRADE WT/DS35/6
10January 1997
ORGANIZATION(97-0082)
Original: English
HUNGARY -EXPORT SUBSIDIES INRESPECT OF
AGRICULTURAL PRODUCTS
Request fortheEstablishment ofaPanel bytheUnited States
Thefollowing communication, dated 9January 1997, fromthePermanent Mission oftheUnited
States tothePermanent Mission ofHungary andtotheDispute Settlement Body, iscirculated atthe
request ofthatdelegation.
_______________
TheGovernment oftheRepublic ofHungary isproviding export subsidies withrespect to
agriculturalproductsnotspecifiedinHungary'sSchedule("Schedule")annexedtotheMarrakeshProtocol
totheGeneral Agreement onTariffs andTrade 1994 ("GATT 1994"), andwithrespect toagricultural
products specified initsSchedule. Hungary isproviding export subsidies inexcess ofthespecified
budgetaryoutlayandquantitycommitmentlevels.Accordingly,thesesubsidiesappeartobeinconsistent
withtheAgreement onAgriculture, including butnotlimited toArticle 3.3,Article 8,andArticle 9.2.
Thecitations under Hungarian lawforthese subsidies include ActVIof1993 ontheOrganization of
Agricultural Markets ("1993 Act") andother relevant provisions.
Pursuant tothe1993 ActandtheJoint Decree oftheMinister ofFinance andtheMinister
ofIndustry andTrade No.38/1994 (XII.30.) PM-IKM onExport Subsidies forAgricultural andFood
Products, asamended (translation attached toG/SCM/N/9HUN), Hungary provided subsidies in1995
withrespect toagricultural products notspecified inSection IIofPartIVofitsSchedule, andinexcess
ofthebudgetary outlay andquantity commitment levels specified inHungary 'sSchedule. Hungary
acknowledged intheCommittee onAgriculture inSeptember 1995thatitsagricultural export subsidy
program wasinconsistent withitsWTO export subsidy commitments (G/AG/R/3, para15).Pursuant
tothe1993 ActandJoint Decree No.45/1995 (XII.29) oftheMinister ofAgriculture, theMinister
ofFinance andtheMinister ofIndustry andTrade, bothsetsofcircumstances continued in1996.
Inacommunication dated 27March 1996(circulated asWT/DS35/1), theGovernment ofthe
United States requested consultations withtheGovernment ofHungary pursuant toArticle 4ofthe
Understanding onRules andProcedures Governing theSettlement ofDisputes ("DSU") andArticle 19
oftheAgreement onAgriculture (totheextent thatitrelates toArticles XXII oftheGATT 1994)
regarding theexport subsidies thattheGovernment ofHungary provides withrespect toagricultural
products. Consultations wereheldon3May1996, andonseveral occasions thereafter, butdidnot
result inaresolution ofthedispute.
./.WT/DS35/6
Page2
Accordingly, theUnited States respectfully requests theestablishment ofapanel toexamine
thismatter inlightoftheAgreement onAgriculture andtofindthatHungary 'sexport subsidies on
agricultural products areinconsistent withHungary 'sobligations under thatAgreement andnullify
orimpair benefits accruing directly orindirectly totheUnited States under theAgreement.
TheUnited States asksthatthisrequest beplaced ontheagenda forthenextmeeting ofthe
Dispute Settlement Body, andthatthepanel beestablished withstandard terms ofreference assetout
inArticle 7oftheDSU.