SUBSIDIES AND COUNTERVAILING MEASURES

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Eleven WTO members — Argentina, Australia, Canada, the European Union, Iceland, Japan, Korea, New Zealand, Norway, Chinese Taipei and the United States — once again jointly called on members to meet their commitment at the 11th Ministerial Conference in Buenos Aires to implement existing notification obligations under Article 25.3 of the Subsidies and Countervailing Measures (SCM) Agreement, and thus strengthen transparency with respect to fisheries subsidies.

Several members noted a positive development — the number of members submitting notifications on their fisheries subsidies has increased. The United States said that of the world's 26 biggest providers of fisheries subsidies, 17 have now provided notifications, with some making their first submission in 20 years. Many of the members taking the floor said that these notifications were critical for the ongoing WTO negotiations on curbing the most harmful fisheries subsidies, where information on existing programmes was an essential precondition for moving the talks forward. 

China noted that its most recent subsidies notification to the WTO submitted in June this year and covering 2017-2018 includes a specific section on fisheries subsidies outlining six programmes at the national level and 20 programmes at the sub-central level, thus making a positive contribution to the ongoing negotiations.

Nevertheless, the chair of the committee, Michèle Legault Dooley of Canada, once again highlighted the problem of missing subsidy notifications. The SCM Agreement requires WTO members to submit notifications of any subsidies they provide which are “specific”, i.e. subsidies given to a particular enterprise or industry, or a group of enterprises or industries. The most recent background note prepared by the WTO Secretariat (G/SCM/W/546/Rev.10) notes that between 1995 and 2017, the number of members that have failed to make a notification rose sharply, as WTO membership increased, from 25 per cent to 48 per cent, albeit with some intervening fluctuations. 

Despite reminders to members to submit their notifications on time, only 69 of the WTO's 164 members submitted their 2019 notifications which were due by 30 June 2019, the chair said. In addition, 72 members still have not submitted their 2017 subsidy notifications, and 60 have still failed to submit their 2015 notifications. The chair strongly urged all WTO members to submit their notifications as soon as possible and use the technical assistance available through the WTO Secretariat if help was needed in filing the notifications.

The United States presented a revised proposal for ensuring timely responses to questions posed by members on the subsidy programmes of other members. The US originally proposed that members receiving requests provide written answers within 60 days and provide written replies to follow-up questions within 30 days; responding to concerns voiced by some members, the US said its proposal would now fix these timelines not as firm deadlines but as “best endeavour” objectives. 

Several members again expressed their support for the revised US proposal, but others expressed concern that the proposal would impose a substantial burden on WTO members and cause difficulties for developing countries in particular.

The United States made a statement expressing disappointment with China's recent decision to withdraw from discussions in the Global Forum on Steel Excess Capacity, which brings together G20 and interested OECD members to address steel overcapacity at its root. Canada, Japan and the European Union echoed concerns regarding continued overcapacity in steel and other sectors due to government interventions and underlined the need to discuss this in the committee.

China again insisted the issue of overcapacity was not within the committee's mandate and said it has done more than its share to cut steel production, reducing capacity significantly. The Russian Federation reiterated its willingness to work with others in addressing overcapacity but said it believes a major contributor to the problem is trade protectionism.

The next meeting of the SCM committee is tentatively scheduled for the week of 27 April 2020.

More information on the WTO’s work on subsidies and countervailing measures, the SCM Agreement, and the subsidy notifications of members is available here on the WTO website.

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