RESTRICTEDWORLD TRADE
ORGANIZATIONG/SCM/W/473
18 December 2001
(01-6377)
Committee on Subsidies
and Countervailing Measures
MEMBERS’ DIFFICULTIES IN MAKING SUBSIDY NOTIFICATIONS, AND THE
PLANNED SUBSIDY NOTIFICATION SEMINAR
Note from the Chairman
A. INTRODUCTION
1. At the 13 December 2001 informal meeting of the Committee, a number of Members noted
that recently the debate on the difficulties of making subsidy notifications, including concerning the
presentational aspects of the subsidy notification questionnaire (G/SCM/6), has largely been confinedto only a handful of Members (among them almost no developing country Members).  It is
nevertheless evident that many Members, including a great many developing country Members,
continue to have a poor record of compliance in respect of subsidy notifications.
2. There is thus an urgent need for the maximum number of Members experiencing difficulties
in notifying to become actively involved these discus sions, to better identify and define the problems
that they are facing, so that appropriate solutions can be found.
3. The point also emerged from the discussion at the 13 December meeting that the substantive
issues being discussed in the context of the subsidy notification seminar and those being discussed in
the context of the presentational aspects of the subsidy notification questionnaire seem to be merging,
and that it would be useful to address them in a unified way.  In this connection, Members noted the
suggestion in the discussion paper concerning the seminar that was circulated by fax prior to the
13 December meeting that a pre-seminar questionnaire be circulated to try to identify with as muchprecision as possible individual Members’ particular difficulties and any ideas they may have for
practical solutions.
4. In view of these considerations, I was asked to revise my discussion papers into a unified
questionnaire-type document, to which I would seek written answers,  and which would form the
basis of our next discussions of these topics.  The idea is that a written exchange of this sort will forcea greater precision into the debate, and create an enduring record of the discussion as it evolves.
5. This document therefore covers the substantive content of both of the earlier discussion
papers, and introduces as well additional points raised at the 13 December 2001 informal meeting.
6. Members should provide written answers  to the questions set forth below, not later than
5 February 2002.   These answers also will be circulated to the Committee as background for future
discussions, including planning for the notification seminar .  All Members – particularly those
experiencing difficulties in making notifications - are therefore strongly urged to reply to these
questions.  If the Committee discussion of these issues does not have sufficient factual basis in
Members’ day-to-day experiences, it will not be possible to find solutions that address the real
problems of notifications.G/SCM/W/473
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B. QUESTIONS CONCERNING DIFFICULTIES IN NOTIFYING
1. Does your government face resource constraints in trying to make subsidy notifications?  If
so, what are the major bottlenecks in the notification system of your government?  Is the problem
primarily an insufficient number  of staff to handle the notifications, or is it more a question of
insufficiently trained  staff?
2. Depending on your answer to question 1, above, if the notification questionnaire format could
be simplified, would this make a difference to your government’s ability to make the required subsidy
notifications?
3. Balancing your government’s needs for as simple a format as possible against its needs to be
able to understand other Members’ notifications when it reviews them, how much simplification
could be introduced without sacrificing transparency?
4. Considering the notification format itself, and the concepts underlying it as found in SCM
Articles 1-3, in your government’ s experience, do individuals responsible for making notifications
have difficulties understanding the requirements due to the language used in the Agreement to define
“subsidy”, “specificity”, etc.?  For example, do these individuals believe that subsidies are in the
nature of cash grants only, and do not encompass revenue foregone via tax and duty incentives?
Could some sort of explanation be introduced into  the questionnaire format to make more clear the
scope of measures that are subject to notification?  How might such an explanation be worded?
5. Does your government experience general problems due to the formatting requirements of the
notification questionnaire?  In particular, does your government maintain any pre-existing information
that addresses the substance of the notification questionnaire, but does not correspond to the
questionnaire’s format?  If so, what are the specific problems that your government encounters whenit tries to format the information as required by the questionnaire?  If the information were to be
notified in its pre-existing format, could it nevertheless be keyed to the data elements of the subsidy
questionnaire?
6. In reviewing other Members’ notifications, would your government find it problematic to
review information that was formatted in a wa y other than the way foreseen in the subsidy
questionnaire, but that comprehensively addressed the substantive elements of the questionnaire?
How important would it be for this information to be keyed or coded to the questionnaire format?
7. Does your government maintain any information about its subsidy or incentive programmes
on official web sites?  How much would your notification of subsidies be simplified if such
information could be submitted in its pre-existing format?  As a reviewer of notifications, what sorts
of limits should there be to the substitution of information from web sites for completed notification
questionnaires?  Would references to web sites be a useful supplement to substantive informationprovided in a notification?
8. Concerning General Rule 6, which requires that notification of subsidies provided “to specific
products or sectors” be organized on a product- or sector-specific basis, does this rule pose problems
for your government when notifying subsidies that are provided on a horizontal, rather than a product-
or sector-specific basis?  What are the specific steps and difficulties in preparing sector- or product-specific information for subsidies provided on a horizontal basis?
9. Does this rule present problems for notification of subsidies that are provided on a product- or
sector-specific basis (e.g., some agricultural subsidies)?G/SCM/W/473
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10. Would a redrafting of General Rule 6 to refer to subsidies "provided on the basis of specific
products or sectors" help to resolve this problem?  (The idea would be to clarify that programme-
based information, rather than product- or sector-specific information would be required for subsidies
provided on a horizontal basis, which product- or sector-specific subsidies would continue to need to
be notified on that basis.)
11. Would such a redrafting pose problems for the review of subsidy notifications, and if so, what
would those problems be?
12. To what extent does the general requirement to provide statistical information on the trade
effects of notified subsidies (chapeau of item 9) impede or delay the presentation of subsidy
notifications?
13.  To what extent does the need to compile the specific kinds of statistical information referred
to in items 9(a) and 9(b) impede or delay the presentation of subsidy notifications?
14. How important is this statistical information about other Members’  subsidies to your
government when reviewing subsidy notifications?  Could these reporting requirements be made less
stringent in some manner?  If so, how?
15. Does your government find, in preparing subsidy notifications, that there is conceptual
overlap or redundancy in some of the information elements as currently drafted?
16. If your government believes there to be overlap, how might this be eliminated?  What drafting
improvements might be introduced to clarify such situations, while preserving the substantive
requirements of Article 25 from which the questionnaire is drawn?
17. Do the requirements to provide information on the policy objective or purpose of the subsidy,
its background and authority, and to whom and how it is  provided pose significant difficulties to your
government in preparing its subsidy notifications?  How might these requirements be simplified?
18. Does the requirement to furnish an explanation where a particular element of information
cannot be provided pose particular difficulties to your government in preparing its notifications?  If
so, is there a way to simplify this requirement while preserving its substantive content?
19. Is there sufficient flexibility in item 7 of the subsidy questionnaire (information on the
amounts of subsidies provided) for your government to be able to notify such information without
undue difficulty?  If not, is there a way to simplify this requirement while preserving its substantive
content?
C. QUESTIONS PERTAINING TO THE SUBSIDY NOTIFICATION SEMINAR
NB:  The notification seminar is being planned for fall 2002 rather than spring 2002 as
originally discussed.  It is planned to hold the seminar in Geneva, to ensure the maximum
possible participation by all Members.
1. Concerning the number and nature of participants in the seminar, how many individuals in
your government have day-to-day responsibility for gathering information about subsidies and for
preparing and submitting subsidy notifications based on that information?  If more than one, please
describe the differences in these individuals ’ responsibilities.
2. Would it be sufficient for your government to have two participants in the seminar?  If not,
why not, and how many participants would be opt imal from your government’s point of view?G/SCM/W/473
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3. Would two days be a sufficient/appropriate length for the seminar?  If not, what would be
more appropriate?
4. Would the following schedule be appropriate:  First session:  detailed presentation of the
basic definitions in Articles 1, 2 and 3 of the SCM Agreement, and presentation of the subsidy
notification obligations in the light of these defini tions.  Second session:  Presentations by Members
concerning the specific problems they experience in preparing subsidy notifications.  Third session:
Information-sharing and brainstorming among Members as to possible practical solutions for the
identified problems (ways to coordinate and streamline gathering and formatting of subsidy
information).  Fourth session:  Follow-up steps to ensure that information shared and lessons learned
would be retained and implemented.  (It has been emphasized that to be effective, such follow-up
should be immediate and intensive.)  Ideas suggested to date have included establishment of informal
contacts among capital-based officials, planning of future focused technical assistance activities, etc.
5. Does your government normally send capital-based representatives to the Committee’s
regular meetings?  If not, why not?
6. Does your government view this subsidy notification seminar as an important event in
improving its ability to understand the subsidy rules,  and to make subsidy notifications in a complete
and timely manner?  (That is, does your government view the seminar as a priority event for itsparticipation?)  Does your government plan to send capital-based participants to the seminar?  If so,
how many and what are their functions?  If not, why not?
7. In the view of your government, would financia l sponsorship only of participants from least-
developed country Members be appropriate?  If not, why not?  What other objective criteria for
eligibility for financial sponsorship could be developed that might be more appropriate?
8. If your government would be prevented from sending participants to the seminar due to
financial constraints, what is the minimum  level of financial sponsorship that would make it possible
to send participants (e.g., airfare only, airfare and subsistence for the days in Geneva, etc.)?
9. Assuming that it is not possible to finance the seminar out of existing trust funds in the WTO
(a possibility currently being explored), and assuming a total budget of approximately CHF 225,000,would your government consider making a donati on to finance it?  If so, how much would your
government be in a position to contribute?
10. If the seminar were financed by earmarked contributions from individual Members, and there
were a surplus in the budget for the seminar (due to  fewer than expected participants from Members
eligible for financial sponsorship, however they migh t be identified), how should any such surplus be
disposed of?  Two possible options have been discussed (I) returning the surplus to the sponsors on a
pro-rata basis; or (ii) making the surplus available on a first-come, first-served basis to otherdeveloping country Members.  Are there other, more appropriate, options?
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