RESTRICTEDWORLD TRADE
ORGANIZATIONG/SG/Q2/CHL/10
23 May 2001
(01-2616)
Committee on Safeguards Original:  English
NOTIFICATION UNDER ARTICLE 12.1(A) OF THE
AGREEMENT ON SAFEGUARDS ON INITIATION OF
AN INVESTIGATION AND THE REASONS FOR IT
NOTIFICATION UNDER ARTICLE 12.4 OF THE AGREEMENT ON
SAFEGUARDS BEFORE TAKING A PROVISIONAL SAFEGUARD
MEASURE REFERRED TO IN ARTICLE 6
NOTIFICATION UNDER ARTICLE 12.1(b) OF THE
AGREEMENT ON SAFEGUARDS ON FINDING A SERIOUS INJURY
OR THREAT THEREOF CAUSED BY INCREASED IMPORTS
NOTIFICATION PURSUANT TO ARTICLE 12.1(c)
OF THE AGREEMENT ON SAFEGUARDS
NOTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2
OF THE AGREEMENT ON SAFEGUARDS
NOTIFICATION UNDER ARTICLE 12.1(a) OF THE AGREEMENT
ON SAFEGUARDS ON INITIATION OF AN INVESTIGATION
(EXTENSION OF EXISTING MEASURE)
AND THE REASONS FOR IT
Questions posed by the EUROPEAN COMMUNITIES
Regarding the Notification made by CHILE
The following communication, dated 21 May 2001, has been received from the Permanent
Delegation of the European Commission.
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- Mixed Oils (G/SG/N/6/CHL/5, G/SG/N/7/CHL/5+ Suppl.1)
1. Did Chile evaluate how far a delay in imposing provisional measures would cause damage
which would be difficult to repair in the meaning of Article 6 SA?  Was Chile able to estimate the
expected amount of such damage and why it would be difficult for domestic producers to repair it ifimports were not restricted as from 13 January 2001?  Could details be provided?
2. Does Chile consider that, leaving aside the factual circumstances of this case, “critical
circumstances” can exist (i.e. “where delay would cause damage which it would be difficult to
repair”) in case of a threat of injury?  Or should critical circumstances normally only be found when
actual injury is already present?  Could Chile elaborate on this point?G/SG/Q2/CHL/10
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- Liquid/Powdered Milk (G/SG/N/8/CH L/2, G/SG/N/10/CHL/ 3, G/SG/N/11/CHL/3)
1. Does Chile consider that an (alleged) “ high degree of correlation between the domestic farm-
gate milk price and the import price of powdered milk ” is sufficient ground to find that these two
products are like or directly competitive within  the meaning of Article 2.1 of the Agreement on
Safeguards (“SA”)?  If not, what other reasons di d Chile consider to come to such conclusion?
2. Does Chile consider that imports increasing in absolute terms but falling in relation to
domestic production and to apparent consumption (the share of imports of powdered milk in apparent
consumption remained stable or decreased between 1998 and June 2000) can meet the standards of
“recent”, “sudden”, “sharp” and “significant” which have been established by the Appellate Body in
Argentina Footwear?  What other factors were considered in this case to arrive to this conclusion?
3. Concerning liquid milk, does Chile consider that a share of imports to domestic production
ranging between 0 per cent and 0.3 per cent is sufficiently important to find that imports are the cause
of injury?
4. On 12 July 2000, Chile found it necessary to impose provisional safeguard measure at 16 per
cent, to remedy injurious effects caused by declining import prices up to end 1999.  In its final
determination, Chile found that in the first semester 2000, import prices rose by 11 per cent for whole
milk powder and by 18 per cent for skimmed milk pow der.  However, after an analysis focusing “ in
particular on the evolution of c.i.f. import prices  of powdered milk and domestic prices of farm-gate
milk”, Chile found it still necessary to impose definitive measures at 12 per cent.  Can Chile explain
how it could ensure that the 12 per cent safeguard duty was “only to the extent necessary to prevent or
remedy injury and to facilitate adjustment” as provided by Article 5.1 SA?
5. Did the Chilean investigating authority re-examine the evolution of the price series of imports
and domestic sales, as it announced in its notifications G/SG/N/8/CHL/2 and G/SG/N/10/CHL/3?  If
yes, can Chile set out the result of this re-examination?
6. Does Chile consider that the imposition of safeguard measures for a limited duration (one
year) and at a level not exceeding bound rates can be “traded-off” with relatively “weak” injury
findings?  How could Chile ensure that domestic producers will be able to adjust within this period?
- Notifications concerning Wheat, Wheat Flour, Sugar, Edible Vegetable Oils
(G/SG/N/10/CHL/1/Suppl.2 +Corr.1, G/SG/N/11/CHL/ 2, G/SG/N/14/CHL/1)
1. Can Chile explain the meaning of the first paragraph of its notification
G/SG/N/10/CHL/1/Suppl.2/Corr.1, wh ere it says that “pursuant to Article 7.2 of the Agreement on
Safeguards, the Chilean investigating authority decided to process  the request for an extension of the
measures”?  Does it mean that the expiring safeguard measure was extended before a definitive
decision could be made as to whether the relevant request was acceptable?  Does Chile believe that
such a procedure would be in conformity to Article 7.2 SA, which states that “(t)he period […] may
be extended provided that the competent authorities of the importing Members have determined […]
that the safeguard measure continues to be necessary (emphasis added)?
2. Can Chile clarify the procedure followed by the investigating authority for taking a decision
to extend the duration of the safeguard measure and explain if and why it considers that this procedure
respected the procedural requirements set down by Articles 3, 8, and 12 SA, as required by Article 7.2SA?
3. Did Chile make any determination as to whether domestic industry is adjusting, as required
by Article 12.2 SA?G/SG/Q2/CHL/10
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4. Can Chile explain why it extended the safeguard measures in this case without providing
adequate opportunity for prior consultations as required by Article 12.3 SA?
5. Can Chile explain if and why it considers that the extended measure is not more restrictive
than it was at the end of the initial period, as required by Article 7.4 SA?
- Notifications concerning Sy nthetic Socks (G/SG/N/6/CHL/3)
1. Can Chile explain why it applied final measures in this case without providing adequate
opportunity for prior consultations as required by Article 12.3 SA?
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