RESTRICTED
WORLD TRADE G/SCM/M/3
26September 1995
ORGANIZATION(95-2807)
Committee onSubsidies andCountervailing Measures
MINUTES OFTHE SPECIAL MEETING HELD
ON21JULY 1995
Chairman: Mr.V.DoPrado (Brazil)1
1. TheCommittee onSubsidies andCountervailing Measures held aspecial meeting on
21July1995.
2. TheCommittee adopted thefollowing agenda:
A. Questionnaire Format forSubsidy Notifications under Article 25oftheAgreement
onSubsidies andCountervailing Measures andArticle XVI:1 ofGATT 1994
B. Status ofSubsidy Notifications under Article 25oftheAgreement onSubsidies and
Countervailing Measures andArticle XVI:1 ofGATT 1994
C. Other Business
A. Questionnaire Format forSubsidy Notifications under Article 25oftheAgreement onSubsidies
andCountervailing Measures andArticle XVI:1 ofGATT 1994
3. TheChairman drewtheattention oftheCommittee todocument G/SCM/W/8, which contained
theproposed newsubsidy questionnaire developed bytheWorking Party onSubsidy Notifications,
andtodocument G/SCM/W/40, which contained acommunication fromtheEUsuggesting afootnote
tobeinserted intotheproposed format. Assuming theCommittee approved theformat, itwould be
senttotheCouncil forTrade inGoods forratification, because theexisting questionnaire format under
Article XVIwasadopted bytheCONTRACTING PARTIES totheGATT 1947andthusrepresented
partoftheGATT 1994.
4. Thedelegate oftheUnited States proposed thatinthefinallineoftheEUproposal, following
theword "modifications," aparenthetical phrase reading "(ortheabsence thereof)" beadded.
5. TheCommittee adopted theformat asmodified.2
./.
1Mr.DoPrado, Vice-Chairman oftheCommittee onSubsidies andCountervailing Measures,
presided inplace oftheChairman oftheCommittee, Mr.O.Lundby.
2Theformat asapproved wascirculated totheCommittee indocument G/SCM/6, dated
9August 1995.G/SCM/M/3
Page2
B. CurrentStatusofSubsidyNotificationsunderSCMAgreementArticle25andGATTArticleXVI
6. TheChairman saidthatthestatus ofsubsidy notifications wasverypoor. Although thedeadline
forsubmission ofthesequestionnaires was30June, theSecretariat hadreceived subsidies notifications
todateonlyfromthefollowing twelve Members: Canada (partial notification), Colombia, Hong Kong,
Indonesia, Japan, Malaysia, Mauritius, Nicaragua, Norway, New Zealand, Thailand, Turkey and
Venezuela. Hungary, India andKorea hadnotified thatnotifications willbeforthcoming. Thefailure
tonotify subsidies cutacross allcategories ofMember: major developed country Members, developing
country Members, andcountries intransformation.
7. TheChairman alsonoted anoverly-narrow viewamong certain Members ofwhatisnotifiable.
Allspecific subsidies, regardless oftrade effects andregardless ofhowstructured, hadtobenotified.
Alsotobenotified were allother subsidies totheextent theycaused increased exports ordecreased
imports asprovided forinGATT Article XVI. Where notifications were restricted tosubsidies to
oneorahandful ofproducts ortosubsidies provided through formal programmes totheexclusion
ofadhocsubsidies, theintent ofthebasic notification obligation wasill-served. Moreover, both
agricultural andindustrial subsidies hadtobenotified tothisCommittee.
8. TheChairman stated thatthecurrent lowdegree ofcompliance setaverybadprecedent. Timely
andsubstantively adequate notifications setthestage forsubstantive review anddiscussion inthe
Committee. Thisprocess allowed allMembers theopportunity tobring upanyconcerns regarding
another Member 'snotified subsidies. Thiswasanefficient means toidentify inconsistencies and
ambiguities andtosettle disagreements without resort toformal dispute settlement. When, asnow,
mostMembers wereoutofcompliance withtheirnotification obligations, suchasystem broke down.
Virtually noMember wasinthemoral position toquestion other Members because ofthewidespread
failure tonotify.
9. TheChairman stated thatgood faithcompliance withobligations inthese early daysofthe
WTO wascritical. Apattern established attheoutset ofaneworder would bedifficult tobreak.
Having spent somany years negotiating tocreate anewsystem, Members owed ittothemselves and
eachother tonowmake thesystem work byimplementing itinagenuine spirit ofcooperation.
10. Thedelegate oftheUnited States deeply regretted thattheUnited States hadnotyetsubmitted
itsnotification. TheUnited States intended tosubmit itsnotification before theendofthesummer.
11. Thedelegate oftheEUstated thattheEUwascollecting allthenecessary information tosubmit
itsnotification, which would besubmitted shortly afterthesummer break. Thenotification would
cover bothCommunity andMember State programmes.
12. Thedelegate ofCanada stated thatCanada would circulate afullnotification covering both
theagricultural programmes which werenotified earlier thisyearaswellasindustrial programmes.
13. TheCommittee tooknoteofthestatements made.
C. Other business
14. TheChairman reminded Members toinform himinwriting oftheirnominations totheInformal
Group ofExperts onthecalculation oftheamount ofasubsidy under Annex IVassoonaspossible.