RESTRICTED
WORLD TRADE G/SCM/W/51
24July1995
ORGANIZATION(95-2121)
Original: English Committee onSubsidies andCountervailing Measures
QUESTIONS CONCERNING THE NOTIFICATIONS PROVIDED
BYTHE GOVERNMENT OFMEXICO OFLAWS
AND REGULATIONS UNDER ARTICLES 18.5AND 32.6THE AGREEMENTS
Thefollowing communication, received 17July1995, hasbeenreceived fromthePermanent
Delegation oftheEuropean Community.
_______________
With regard toMexico 'slegislation onsubsidies andcountervailing measures (Mexican Law
onUnfair Practices), notified on17May1995 under Article 32.6oftheWTO Subsidies Agreement
(document G/SCM/N/1/MEX/1), theEuropean Community hasthefollowing questions:
General
Thegeneral reference throughout thetextto"price discrimination" seems inappropriate inthis
context, asprice discrimination isonlyrelevant indetermining theexistence ofdumping.
ANNEX I-FOREIGN TRADE ACT
TITLE V
1. Chapter I
Article 29
Article29,secondsectionsays:"Evidenceofinjuryorthreatofinjuryshallberequiredwhenever
thecountry oforigin orsource ofthegoods inquestion observes reciprocity. Otherwise, theMinistry
mayimpose theappropriate countervailing duties without having toprove injury orthreat ofinjury".
Inthisregard, theCommunity asks:
(i) What does"reciprocity" mean inthiscontext?
(ii) Onwhatbasisandinwhatcircumstances, inviewoftheprovisions ofArticle 10ofthe
Subsidies Agreement, cancountervailing measures betaken without apositive
determination ofinjury?
(iii) Isacomplaint required, andisaninvestigation carried outbefore measures aretaken,
asrequired byArticle 10oftheSubsidies Agreement?G/SCM/W/51
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2. Chapter IV
Article 40
Article 40,second paragraph states: "When alloftheproducers arerelated totheexporters
orimportersorarethemselvesimportersoftheproductunderinvestigation,theterm"domesticindustry"
maybeinterpreted asreferring totheentire group ofproducers ofthegoods produced during the
immediately preceding stage inthesame continuous lineofproduction".
Inthisregard theCommunity asks:
(i) Arethegoods produced during theimmediately preceding stage inthesame continuous
lineofproduction likeproducts totheimported goods, asdefined infootnote 46ofthe
Subsidies Agreement?
(ii) Iftheyarenotlikeproducts, howisthisdefinition of"domestic industry" compatible
withArticle 16oftheSubsidies Agreement?
Article 42
Inaccordance withArticle 15(7) oftheSubsidies Agreement, theinvestigation authorities should
consider thenature ofthesubsidy orsubsidies inquestion andthetradeeffects likely toarisetherefrom,
when assessing threat ofinjury.
Please explain whythisfactor hasnotbeenincluded intheMexican legislation. Does Mexico
consider thatchanges inthelevel ofthesubsidy would have anyimpact onthethreat ofinjury
assessment?
Article 43
Asregards cumulation, theCommunity isnotconvinced thattheMexican legislation fulfils
therequirements setoutinArticle 15.3oftheSubsidies Agreement forcumulatively assessing the
effects oftheimports. Please explain under which conditions cumulation would bepossible.
TITLE VII
3. Chapter I
Article 49
Under which conditions cananinvestigation exofficio beinitiated? Arethe"special
circumstances" ofArticle 11(6) oftheSubsidies Agreement foreseen inthisregard? What evidence
isrequired foranexofficio notification?
Article 50
Article 50says: "Therequesting parties mustberepresentative ofthedomestic industry, ...".
Isthisthesame as"awritten application byoronbehalf ofthedomestic industry" inaccordance with
Article 11oftheSubsidies Agreement?
What doesMexico consider as"legally constituted organizations"? Isthisprovision consistent
withArticle 11(4) oftheSubsidies Agreement insofarthatatleast25percentofthedomestic industry
should support acomplaint?G/SCM/W/51
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Article 53
Does thetimelimitof30daysinclude orexclude thetimefortransmitting questionnaire as
setoutinfootnote 40toArticle 12.1.1 oftheSubsidies Agreement? Cananextension ofthetime
limitbegiven?
Article 56
Would italsobepossible forinterested parties torequest non-confidential information viathe
Mexican authorities?
4. Chapter II
Article 57
How willMexico ensure thatprior totheimposition ofprovisional measures, apreliminary
affirmative determination ofsubsidization andinjury hasbeenmade?
According toArticle 57,provisional measures canbeimposed afteraperiod ofatleast45days
from thepublication oftheresolution toinitiate theinvestigation. How canthe45dayperiod be
reconciled withthe60daysprovided forinArticle 17.3oftheSubsidies Agreement?
Article 61
Canconsultation withother WTO Members takeplace before theinitiation ofaninvestigation
asforeseen inArticle 13.1oftheSubsidies Agreement? Willsuchconsultations beoffered byMexico?
Article 62
Mexico failstoprovide anexplanation ofhowitintends tocalculate theamount ofthebenefit
ofthesubsidy. Please explain onwhatelements suchcalculations willbebased.