RESTRICTEDWORLD TRADE
ORGANIZATIONG/AG/R/26
31 May 2001
(01-2753)
Committee on Agriculture
SUMMARY OF THE MEETING HELD ON 29-30 MARCH 2001
Note by the Secretariat
1. The Committee on Agriculture held its twenty-sixth regular meeting on 29-30 March 2001
under the chairmanship of Minister Yoichi Suzuki, of Japan.  The agenda of the meeting as containedin WTO/AIR/1518 was adopted with the following modifications:  the inclusion of a joint proposal
(G/AG/W/50) by MERCOSUR, Bolivia, Chile, Costa Rica, Guatemala, India and Malaysia under
Part I, G (i), "Implementation of Article 10.2";  and, the inclusion of a joint proposal (G/AG/W/49) by
Côte d'Ivoire, Cuba, Dominican Republic, Egypt, Honduras, Jamaica, Kenya, Mauritius, Morocco,
Pakistan, Senegal, Sri Lanka, Saint Lucia, Trinidad and Tobago, Tunisia and Venezuela, forconsideration under Part II, A, "Examination of possible means of improving the effectiveness of the
implementation of the Marrakesh Decision".
P
ART I:  T HE REVIEW PROCESS
A .      M ATTERS RELEVANT TO THE IMPLEMENTATION OF COMMITMENTS UNDER THE REFORM
PROGRAMME : ARTICLE 18.6
(a) Argentina:  European Communities – Payments under production-limiting programmes
2. The representative of Argentina sought information on the types of cereals which currently
benefit from direct payments under production-limiting programmes (Article 6.5), the amount of
support which has been granted annually to each specific product since 1995 under such programmes,as well as that decided during the marketing year 1992.  In this context, Argentina recalled that during
the February meeting of the Special Session of the Committee on Agriculture, the European
Communities had explicitly acknowledged that Article 13 effectively established product-specific
limits with respect to government expenditures on measures covered by the Blue Box (G/AG/NG/R/5,
page 10, paragraph 39, refers).   Argentina also noted that these limits, namely the levels of supportdecided during the marketing year 1992, should be notified to the Committee for the sake of
transparency and in order for Members to check compliance.
3. The representative of the European Communities stated that cereal producers received direct
payments on the basis of fixed areas and yields in conformity with EC 's commitments under the
Agreement on Agriculture.  A breakdown of expendit ures by specific cereal product was therefore not
available.  Moreover, the EC pointed out that the details sought by Argentina went beyond the scope
of the notification procedures adopted by the Committee to review the implementation of Members'
commitments.  The EC delegate gave assurances that the EC complied fully with its obligations under
the Agreement on Agriculture.
4. Argentina stated that it was disappointed with the EC's response as assurances alone
concerning compliance were insufficient.  Argentina, supported by Australia, Brazil, Colombia, New
Zealand and Uruguay, believed that the clarifications sought were pertinent to the review process
undertaken by the Committee on Agriculture.  Since the support levels decided in the marketing year
1992 constituted elements which were relevant to the implementation of commitments, they disagreedG/AG/R/26
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with the view that the present re quest for information was beyond the scope of the review process.  In
this context, Australia, supported by Canada, recalled that Article 18.6, under which the present issue
was raised, stipulated that " The review process shall provide  an opportunity for Members to raise any
matter relevant to the implementation of commitments under the reform programme as set out in this
Agreement."    Colombia believed that Article 18.7 was also relevant in this case.   The EC was asked
to reconsider its initial position and to prepare the requested data.  Some Members believed that this
would enable the Committee to assess EC's compliance on that basis, i.e. by comparing the
information provided against the ceilings established by Article 13(b)(ii).
5. The representative of Brazil stated that Argentina had raised a matter which was of great
importance to the Agreement on Agriculture and which was of a dual nature.  The first issue was
systemic and needed to be addressed by the entire WTO membership.  In Brazil's opinion,
Article 13(b)ii established thresholds.  These thresholds have never been notified but, for Article 13 tobe fully implemented,  needed to be identified.  In  this respect, Brazil requested guidance from the
Vice-Chairman to find a suitable way to resolve what it perceived as a lack of implementation of the
Peace Clause.  In addition, Brazil asked the Committee to include this important systemic issue in the
agenda of the regular meetings of the Committee on Agriculture in order to reflect on how
information on support levels given in the marketing year 1992 could be gathered.   This proposal wassupported by Uruguay.  Although Argentina's primary intention was not to raise a systemic issue but
only to obtain data relating to the implementati on of Blue Box measures by the EC, it also fully
endorsed Brazil's proposal.
6. According to Brazil, the second facet of th e problem related to the review process under
which a request from one Member to another referred to information dating back to 1992.  Brazilexpressed surprise that the EC was unable to give Argentina data that were now 9 years old.  Brazil
joined other Members in encouraging the EC to subm it such information for the sake of transparency.
7. The representative of the European Communities took note of the points made by the
intervening Cairns Group members and stated that he understood the logic behind Argentina's request
for information.  However, he pointed out that Article 13 was not a matter of implementation but a
matter of legal protection.  Referring to Brazil's intervention in particular, the EC stated that it
understood Brazil as suggesting that all Members should submit data on the levels of support granted
in the marketing year 1992, irrespective of whether such support came under the Amber Box.  In the
EC's view, that would be an interesting developm ent that might prompt the EC to reconsider its
position on this matter.
8. Uruguay was disappointed that Argentina's request for clarification was rejected as this matter
could have been easily and effectively solved thr ough an exchange of information and by showing
greater transparency.   The EC's statement that Article 13 was a matter of legal protection seemed to
be an invitation for Members to seek a satisfactory reply through dispute settlement procedures, a
solution which Uruguay considered to be excessive.  Colombia recalled that the protection afforded
by the Peace Clause was not infinite because Article 13(b)(ii) set limits to such protection.  Referringonce more to EC's intervention during the Special Session held in February 2001, Argentina stated
that the EC's reticence to cooperate by providing the requested data, which should be publicly
available, would enable a panel to draw adverse inferences should Argentina take recourse to dispute
settlement.
9. The EC recalled that the statement made during the February 2001 meeting was in the context
of a Special Session, and in the EC's view, belonged  to a different forum.  In that framework, all
issues of interest to Members would be addressed, including the present one. The EC also stated that it
fully respected its commitments as well as the existing notification procedures and that there was no
agreement to notify the levels of support given in 1992.  If the Committee decided to consider thisG/AG/R/26
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issue, the EC would be open to reflect upon it prov ided that all Members were invited to notify such
information for all domestic support measures.
10. Argentina wondered how the EC could state th at it fully complied with its commitments,
particularly the thresholds imposed by Article 13(b )(ii), since according to the EC, no breakdown of
support levels decided during the marketing year 1992 was available for cereals.  Furthermore,Argentina noted that such a breakdown was not provided in the EC's notifications.
11. The EC clarified that its first answer related to the years 1995 onwards, not to 1992.  The EC
considered that for 1992, the matter was of a different nature as there was no agreement, in the
Committee, to notify such data.
12. The Vice-Chairman recognised that this new implementation concern raised a systemic
question.  However, he also noted the diverging views on how this matter should be treated.  The
Vice-Chairman stated that he would first hold informal discussions with the Members which hadintervened, and report back to the Committee.  He suggested that the issue could be included on the
agenda of the next regular session.  It was so agreed.
13. The representative of Mexico enquired whether such informal consultations would be limited
to the question raised by Argentina at this meeting.   Should horizontal issues be covered, such as a
discussion of Article 13(b)(ii), Mexico expressed interest in being associated to the informalconsultation process conducted by the Vice-Chairman.   The Vice-Chairman stated that the informal
discussions he would conduct would deal only with the specific issue raised by Argentina.
(b) Canada and United States:  India – Wheat exports
14. Canada raised queries on India's recent exports of wheat from non-commercial stocks
acquired under the domestic price support system.  Canada sought clarification on the prices charged;
actual and planned levels of such exports; on whether India imposed a requirement to export wheat
obtained from the government stocks; and if so, under what circumstances.  Finally, Canada asked
whether the export of surplus stocks acquired under the domestic price support programme for wheat
will be on-going.
15. The United States raised a set of detailed questions on the same issue.   Confirmation was
sought that the Government of India, through the St ate Trading Corporation of India, the Minerals and
Metals Trading Corporation of India, and the Project and Equipment Corporation, had recently sold
700,000 tonnes of wheat into the export market;  that an export target of up to 2 milion tonnes had
been established for marketing year 2000/01; and whether a specific target for marketing year
2001/02 had been set. The United States also unde rstood that private, non-government-related firms
were not allowed to participate in the export of this wheat and queried certain conditions linked to thewheat made available for export.  The United States asked India to explain, for example, whether the
state trading enterprises involved had the option of selling the wheat made available for export back
into the domestic market, and if not, the rationale  for precluding this wheat's sale back into the
domestic market.
16. The United States requested further confirmation concerning the following data:  the support
price of Rupees (Rs) 5,800 per tonne of wheat; the cost of Rs 8,300 per tonne, i.e. when storage,
handling, and administrative costs are added;  the domestic sale price at a break-even cost of Rs 8,300
per tonne to above-poverty-income-level families;  the sale price to domestic flour millers, ranging
from Rs 6,500 per tonne in the north to Rs 7,430 per tonne in the south of India, or at Rs 870 to 1,800
below the cost to the Government, after storage and handling costs are included; the domestic saleprice to families with incomes below the poverty threshold within India at a subsidized price of
between Rs 2,000 and 4,150 per tonne, well below the actual cost of the wheat to the Government; theG/AG/R/26
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availability of wheat for export by state trading enterprises at Rs 4,150 per tonne (plus handling
costs), or at the same price level of the subsidized wheat sales to those families with incomes below
the poverty threshold in the domestic market; the sa le price applied by state trading enterprises into
the export market which is not below Rs 4,150 minus the costs associated with putting the wheat into
export position.
17. The representative of India informed the Committee that the competent authorities were in the
process of collecting the necessary information and undertook to provide the answers as soon as
possible.
(c) New Zealand:  Venezuela – Dairy import regime
18. Despite previous discussions and reviews of related notifications, New Zealand stated its
concern about Venezuela's tariff quota administration regime for dairy products.  New Zealand has
continued to experience significant and damaging delays in obtaining import licences and soughtinformation on the criteria for allocating import licences among competing firms within the
"traditional" and "new" importers categories, including details on how the quantitative calculations
were performed and whether these calculations were based on market share or share of imports.
Clarification was sought as to how new importers, which by definition can be "firms entering the
market for the first time", could receive an allocation on the basis of "previous import levels".Venezuela was also asked to explain how it intended to deal with unused or partially-used licences,
and whether all importers received licences at the same time.  New Zealand sought comments on
implementation issues foreseen to occur as a result of the changes to the import regime.  Moreover, on
the tariff quota administration regime as notif ied (G/AG/N/VEN/17), New Zealand asked Venezuela
to reply to a number of queries relating to the time taken by the Ministry of Production and Trade toissue licences for skim milk powder, whole milk  powder and cheese in the year 2001, taking into
account the three-month import licence period, the dates on which requests for import licences were
sought, the closing dates for application, as well as the dates on which import licences were issued.
19. With regard to the criteria for allocating licences, the representative of Venezuela pointed out
that 90 per cent of each of the tariff quotas was divided between competing firms that had imported
over the last two years.  These firms were designated as "traditional", or "historical", importers.  The
remaining 10 per cent was allocated to firms enteri ng the Venezuelan market for the first time or
which were occasional importers.  Within the traditional importers category, licences were allocated
on the basis of past import volumes.  In the case of new importers, the tariff quota was shared out on a
simple pro rata  basis.  Traditional importers were required to provide a monthly list of imports
effected over the previous two years.  New importers were exempt from this requirement, as indicated
in document G/AG/N/VEN/17 (page 4 of the Spanish version refers).  All importers receive importlicences at the same time, on the day that they were awarded.  Should the importer, for whatever
reason, be unable to use the tariff quota volume allocated under the licence, the Ministry of
Production and Trade could be contacted so that a new import licence could be issued.  The unused
part of the tariff quota would be reintegrated into the total tariff quota volume to be distributed, in
order to guarantee adequate supplies to the domestic market and ensure compliance with marketaccess commitments.
20. With regard to the time-limits applying to import licences, Venezuela confirmed the
following:  the Ministry of Production and Trade publishes an official notice stipulating the
documents required when applying for a licence.  Following this publication, there follows a 21-day
period for interested import firms to complete the pro cess.  A period of eight days is then allowed for
studying the applications received.   In addition, tariff quotas are opened on a quarterly basis to allow
imports to be effected throughout the year.  Import licences are valid for three months.G/AG/R/26
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21. Venezuela observed that recent outbreaks of bovine spongiform encephalopathy and foot-
and-mouth disease had led the competent authorities to adopt certain health measures.  This
development may have adversely affected the delivery of import licences for dairy products.
However, Venezuela emphasized that the problem had already been overcome and confirmed that the
issuing and delivery of licences to interested parties was proceeding according to the establishedcriteria.
22. New Zealand expressed appreciation for the responses given by Venezuela.  This issue
however remained of major concern to New Zealand as access to the Venezuelan markets continued
to be frustrated.   Furthermore, New Zealand's understanding was that there was a linkage between
imports and domestic milk usage.  While several import licensing options had been implemented in
Venezuela, in New Zealand's view, they all contained a mixture of domestic milk usage and historical
imports.  As a result, some companies had received considerably less than they asked for, while othershad received far more.  As a traditional exporter to Venezuela, New Zealand found it hard to
understand the situation and felt that the level of transparency was far from ideal.  As long as it
continued to experience such delays, New Zealand would revert to this matter in the Committee in
order to directly address inefficiencies in Venezuela's import licensing allocation procedures.
(d) United States:  Costa Rica – Ban on US poultry imports
23. The representative of  the United States reported that the Costa Rican Ministry of Agriculture
began prohibiting poultry imports from the United States in February 2001 with no justification nor
prior notification to the WTO.   Prior to this, poultry imports had taken place without interruption
since August 2000, after an agreement had been reached between the US Department of Agriculture
(USDA) and the Costa Rican Ministry of Agriculture regarding import requirements.  The UnitedStates underlined that the two tariff quotas for poultry established by Costa Rica as part of its market-
access commitments were yet to be filled for 2001 an d suggested that the process of issuing licences
should be automatic.   Furthermore, the United States understood that the Costa Rican Ministry of
Agriculture has been reviewing requests for some products, including poultry and rice, on a case-by-
case basis, and selectively denying permits, apparently giving in to pressure from domestic poultryproducers.  The United States asked Costa Rica to remove the ban.
24. The representative of Costa Rica informed the Committee that consultations between the
concerned national institutions were being held with a view to solve this issue.  Costa Rica undertook
to provide more concrete information in the near future.
B. R EVIEW OF NOTIFICATIONS
25. The Committee reviewed the following notifications as listed in the agenda:
(i) on the administration of tariff and other quota commitments (Table MA:1): from
Costa Rica (CRI/1/Rev.1); Ecuador (ECU/8); El Salvador (SLV/9); Venezuela
(VEN/17);
(ii) relating to imports under tariff and other quota commitments (Table MA:2): from
Australia (AUS/35); Costa Rica (CRI/8);  Ecuador (ECU/9, ECU/9/Corr.1 and
ECU/13); European Communities (EEC/29); Iceland (ISL/16); Israel (ISR/21); Japan
(JPN/58); Mexico (MEX/11/Rev.1); No rway (NOR/27); Romania (ROM/15);
Slovenia (SVN/16); South Africa (ZAF/30); Tunisia (TUN/20);
(iii) in the context of the special safeguard (Tables MA:3 to MA:5): from Australia
(AUS/34); Barbados (BRB/5); Canada (CAN/39); Ecuador (E CU/10 and ECU/14);
European Communities (EEC/24); Iceland (ISL/18); Israel (ISR/22); Japan (JPN/59G/AG/R/26
Page 6
and JPN/60); Norway (NOR/29); Poland (POL/36, POL/38 and POL/39); Romania
(ROM/14); South Africa (ZAF/33); Tunisia (TUN/19); Venezuela (VEN/18);
(iv) relating to domestic support commitments  (Table DS:1): from Brazil (BRA/18);
Costa Rica (CRI/9); Cuba (CUB/11); Cy prus (CYP/10); Ecuador (ECU/11 and
ECU/15); European Communities (EEC/26); Israel (ISR/19); Japan (JPN/61); Korea(KOR/30); Latvia (LVA/3/Rev.1); Malaysia (MYS/13); Malta (MLT/6); Mexico
(MEX/7); Norway (NOR/30); Poland (POL/37); Romania (ROM/17); Slovenia
(SVN/4/Rev.2, SVN/5/Rev.1, SVN/8/Rev.1, SVN/12/Rev.1 and SVN/14); Tunisia
(TUN/18); Uganda (UGA/2); Venezuela (VEN/19);
(v) relating to new or modified domestic support measures exempt from reduction
(Table DS:2): from Canada (CAN/40); Co lombia (COL/23); Japan (JPN/62); Mexico
(MEX/6); Norway (NOR/31); South Africa (ZAF/31);
(vi) relating to export subsidy commitments (Tables ES:1 to ES:3):  from Argentina
(ARG/13); Australia (AUS/33); Barbados (BRB/4); Burkina Faso (BFA/3); Canada
(CAN/41); Colombia (COL/19/Corr.2.); Costa Rica (CRI/4/Add.1 and CRI/13);
Ecuador (ECU/12 and ECU/16); Estonia (EST/2 ); Iceland (ISL/17); Israel (ISR/20);
Korea (KOR/29); Malta (MLT/7); Mexico (MEX/10); Norway (NOR/28); Romania(ROM/16 and Corr.1); South Africa (ZAF/34); Tunisia (TUN/21); Uganda (UGA/1);
(vii) relating to export prohibitions and restrictions (Table ER:1):  from Hungary (HUN/24
and Add.1)
26. Specific points raised with respect to the notifications listed above and the responses thereto
are summarized in Part I of the Annex to this report.  During the review of notifications, certaindelegations also raised points of a more general nature, notably on market access under tariff quota
commitments, and on domestic support.
27. The United States stated that in their experience with tariff quota management, when a price
differential existed between domestic and world prices, the tariff quotas were rather quickly filled,
unless other, non-market-related factors were impeding full utilization.  Referring to all US questionson Table MA:2 notifications which were up for review at the present meeting,  the United States
expressed an interest in receiving the price data on a monthly average for each market, when the
reason quoted by the notifying Member was " a lack of economic incentive ".  Such information would
be useful for Members to gain an in-depth understan ding of tariff quota administration.  As the second
phase of the negotiations was about to be initiated, this would help establish more viable market
access commitments.
28. Further to Argentina's queries on Japan's levels of Blue Box expenditures during marketing
year 1992, Japan requested that its delegation be joined in the informal process during the informal
consultations which are due to be conducted by the Vice-Chairman (paragraph 12 refers).  In relationto such requests for information during the review of notifications, Uruguay recalled that, in order to
substantiate their de minimis  claims, Members supplied, either in the notification itself, or orally
during the review process, data on the relevant levels of agricultural production in order to allow theCommittee to check compliance with Amber Box thresh olds.  This exchange of information routinely
happened despite the non-existence of a formally-adopted notification procedure. Uruguay was
therefore struck by the reticence shown by certain Members to supply the information requested by
Argentina on the thresholds placed on Blue Box usage.G/AG/R/26
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C. P OINTS CONCERNING NOTIFICATIONS RAISED AT PREVIOUS MEETINGS (G/AG/R/2,
PARAGRAPH 14 REFERS )
29. There was no discussion under this agenda item.
D. N OTIFICATIONS CIRCULATED OR MADE AVAILABLE AFTER THE NOTICE CONVENING THE
MEETING WAS ISSUED (G/AG/1, PARAGRAPH 9 REFERS )
30. The following notifications were subject to prelim inary review and are to be reverted to at the
next meeting for substantive review in accordance with paragraph 9 of the Committee's Working
Procedures:
(i) on imports under tariff and other quota commitments (Table MA:2): from the Slovak
Republic (SVK/27);
(ii) on special safeguard (Tables MA:3 to MA:5): from the Slovak Republic (SVK/28);
(iii) on domestic support commitments (Tables DS:1 and DS:2):  from the European
Communities (EEC/30); Jamaica (JAM/5);
(iv) on export subsidy commitments (Tables ES:1 to ES:3):  from the Slovak Republic
(SVK/26);  Zimbabwe (ZWE/3).
E. C OUNTER NOTIFICATIONS UNDER ARTICLE 18.7
31. The Committee took note that no counter-notifications had been received under Article 18:7
of the Agreement.
F. O THER MATTERS RELATING TO THE REVIEW PROCESS
(a) Deferred replies to questions raised under the Review Process
32. Deferred replies to questions raised at previous meetings have been received by the
Secretariat from Norway (with respect to G/AG/N/NOR/27); Costa Rica (G/AG/N/CRI/7); Malaysia
(G/AG/N/MYS/13); a nd South Africa (G/AG/N/ZAF/29).   These replies are summarized in Part II of
the Annex to this report.
(b) Overdue notifications
33. As had been agreed at the March 1997 meeting of the Committee (G/AG/R/10, paragraph 10
refers) the Secretariat made available a Room Document, dated 29 March 2001, showing the current
status of compliance with the notification obligations.
G. I MPLEMENTATION -RELATED MATTERS REFERRED TO THE COMMITTEE BY THE GENERAL
COUNCIL
(a) Implementation of Article 10.2 of the Agreement on Agriculture
34. The Committee's discussions under this agenda item are summarized in the report which it
was agreed would be submitted by the Vice-Chairman to the General Council (G/AG/8, refers).G/AG/R/26
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(b) Submission of addenda to Table MA:1 notifications
35. The Vice-Chairman recalled that this item was on the Committee's agenda on referral from
the General Council pursuant to its Decision of 15 December 2000 on implementation-related issues
and concerns (WT/L/384, paragraph 1.1, refers).
36. Mexico stated that, as indicated by the Chairman of the General Council when the Decision
was approved, this additional notification requirement should not become an unnecessary burden for
developing country Members.  Slovenia enquired about the format to be used when submitting
addenda to previous notifications and asked whether copies or translations of the relevant nationalregulations should be forwarded.  The Vice-Chairman replied that the Committee should be provided
with all the necessary and relevant information showing that the tariff quotas are administered in a
transparent, equitable and non-discriminatory manner.  The Vice-Chairman suggested that Memberswishing to raise technical issues should contact the Secretariat.
37. The Vice-Chairman invited Members with tariff rate quota commitments to submit the
relevant addenda as far as possible in advance of the June meeting in order to enable the Committee to
have detailed discussions on this agenda item.
P
ART II:  O THER MATTERS WITHIN THE PURVIEW OF THE COMMITTEE
A. I MPLEMENTATION -RELATED MATTERS REFERRED TO THE COMMITTEE BY THE GENERAL
COUNCIL - EXAMINATION OF POSSIBLE MEANS OF IMPROVING THE EFFECTIVENESS OF THE
IMPLEMENTATION OF THE DECISION ON MEASURES CONCERNING THE POSSIBLE NEGATIVE
EFFECTS OF THE REFORM PROGRAMME ON LDC S AND NET FOOD -IMPORTING DEVELOPING
COUNTRIES
38. The Vice-Chairman stated that this item had been included on the Committee's agenda to
reflect the General Council Decision of 15 December 2000 (WT/L/384 refers).  The relevant part of
this Decision constituted the Committee's mandate.  The Committee's discussions under this agendaitem are summarized in the report which it was agreed would be submitted by the Vice-Chairman to
the General Council (G/AG/7, refers).
B. R
EVIEW OF THE WTO L IST OF NET FOOD-IMPORTING DEVELOPING COUNTRIES
39. The Committee noted that paragraph 3 of the Committee's November 1995 decision on the
establishment of a WTO list of Net Food-Importin g Developing Countries for the purposes of the
Marrakesh Ministerial Decision provided that the list shall be reviewed by the Committee at itsregular March meetings (G/AG/3, refers).  There were two new applications before the Committee,
one from Saint Kitts and Nevis and the other one from Saint Vincent and the Grenadines.   The
relevant statistical data, submitted by both countries in line with paragraph 2 of the Committee's
decision on the establishment of the List (G/AG/3, refers), was available for consultation in the
Agriculture and Commodities Division.
40. Barbados supported the application of both countries.   The Committee decided
 to include
Saint Kitts and Nevis and Saint Vincent and the Grenadines in the WTO List of Net-Food Importing
Developing Countries  (G/AG/5/Rev.4).
41. The Vice-Chairman recalled that the inclusion of countries into the List would not, as such,
confer automatic benefits, since under the mechanisms covered by the Marrakech MinisterialDecision, donors and institutions concerned would have a role to play (G/AG/R/4, paragraph 17,
refers).G/AG/R/26
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C. M ATTERS RAISED UNDER "OTHER BUSINESS "
(a) Chile - Functioning of the US Hass Avocado Board
42. The representative of Chile reiterated the concerns previously raised with respect to proposed
US legislation for the creation of a Hass Avocado Board (G/AG/R/25, page 25, refers).  Although the
regulatory framework was still in the proposal stage, Chile underlined that the deadline for sending
comments to the US Department of Agri culture (USDA) had lapsed on 9 March 2001 .
43. Prior to the meeting, Chile had conveyed the following detailed queries to the United States
on: the types of avocado which were produced and consumed in the United States; details of the
domestic production of avocados, both Hass and other kinds, as well as details of imports broken
down by type of avocado; nature of taxes imposed on non-Hass avocados produced in the UnitedStates.  Chile also sought clarification as to how the United States intended to close the existing gap in
the legislation of each State, apart from California, as regards the setting-up of a Board for avocados
which could be entirely composed of importers.  Furthermore, Chile understood that the fee imposed
on domestic producers would be US$0.025 per pound sold.  On the other hand, refunds to those
producers were made according to a percentage of production.  Chile enquired about the functioningof the refund mechanism should domestic production be greater than sales, the amount collected being
therefore less than the total amount to be refunded.  This was particularly relevant as a perishable
product was involved and so, in Chile's view, production might well be greater than sales.  In light of
the above considerations, Chile wondered if the setting-up of a Board of importers would ever prove
feasible, given that the tax refund system differed as between domestic production and imports. Chilewas interested in knowing the solution that the Unit ed States would adopt should the funds remaining
after payment of the California Avocado Commission were insufficient for the other boards.  Chile
pointed out that, in the case of importers, refunds were made on the basis of the taxes actually paid.
44. Mexico and New Zealand recorded their countries' interest in this issue and thanked Chile for
raising it.   New Zealand associated itself with the questions posed and stated that, like Chile, the New
Zealand industry had made a submission to USDA.
45. Given the complex nature of the questions posed by Chile, the United States undertook to
provide detailed responses in writing to Chile, Mexico, New Zealand and the Secretariat at the earliest
opportunity.
(b) Chile – EC canned peaches regime
46. The representative of Chile raised his country's continued concerns with the EC canned
peaches regime and its consequent devastating effects, in particular the dramatic decline in
international prices caused by the misuse, by some EC member States, of agricultural subsidies.  Chile
noted that despite efforts to hold bilateral consultations and the submission by Chile of detailed
questions (G/AG/W/46, refers), to which the EC had not reacted, no satisfactory solution had been
found.  Since December 2000, the EC had introduced regulatory changes to the common market
organisation of the processed fruit and vegetables sector.  Chile considered that some of these changeshad been positive and useful in alleviating some of the concerns which Chile had repeatedly raised on
previous occasions.  However, Chile hoped that the EC would soon be able to bring some clarification
on the many other questions which remained unanswered, especially in light of the newly-enacted
legislation.
47. The delegations of Argentina, Australia, New Zealand, Uruguay and the United States,
expressed their on-going interest in this issue as well as in receiving any responses that the EC may
provide in future.G/AG/R/26
Page 10
48. The representative of the European Communities questioned Chile's assumption that there
existed a causal link between the EC's support regime and international prices.  To date, and as
reflected under Agenda item A of Part II, there was no consensus on the effects of the implementation
of the results of the Uruguay Round on international ma rkets.  The EC representative stated that there
had been numerous contacts with the Chilean authorities in which all the information requested hadbeen forwarded.  The EC confirmed that a new support mechanism had been introduced.  Until the
previous marketing year, a system of minimum prices applied to peaches for processing, with
producers receiving the payments directly from processors.  The new mechanism, in which processors
ceased to be involved, was based on direct payments to producers.  Such payments fell within given
limits and were effected through agricultural producer organizations.  Market-oriented and transparent
mechanisms had been therefore re-established between producers and processors.  The EC stated that
this new support system had been notified to the WTO and that the EC fully met its commitments.
49. Chile thanked the EC for the above explanations and stated that it continued to look forward
to receiving responses in writing to the detailed questions it had posed.  Chile also clarified that it was
not the causal link which was at issue here but rather, as reflected in G/AG/R/24 paragraph 17, the
way in which certain EC member States made use of agricultural subsidies, given their production
cost structure.
D. R EQUEST FOR OBSERVER STATUS BY INTERNATIONAL INTERGOVERNMENTAL
ORGANISATIONS
50. The Vice-Chairman recalled that, as indicated in document G/AG/W/29/Rev.4, there were a
number of requests by various international or regi onal intergovernmental organisations for observer
status in the Committee.  The matter was last considered at the Committee's November 2000 meeting(G/AG/R/25, paragraph 42, refers) at which stage it was noted that no consensus had been reached on
any of the ten outstanding requests before the Co mmittee, with the last two requests originating
respectively from the Asian and Pacific Coconut Community (APCC) and from the Common Market
for Eastern and Southern Africa.
51. Speaking on behalf of Indonesia, Malaysia
 and Thailand , the representative of the Philippines
expressed support for the application of APCC.  As the only inter-governmental coconut body, APCC
represented the interests of its seven Asian and six Pacific member countries.  APCC articulated the
common position of all coconut-producing and exporting countries and maintained friendly relations
with other producing countries of Latin America, the Caribbean and Africa.  In addition, the
Philippines believed that APCC's participation could enrich the deliberations of the Committee and
serve as a harmonizing element in the resolution of issues that affect, and are affected by, the coconut-
producing and exporting countries.
52. Cuba registered its support for the ACP Group of countries, the majority of which are
developing countries, as well as for the South Centre, an institution which assisted developing
countries to improve their effective participation in the WTO negotiations.
53. Egypt expressed support for granting observer status to the organizations which had requested
it but believed that the Committee should await po litical direction from the General Council which
was presently addressing this issue.
54. The Committee took note of the statements made.
E. E LECTION OF CHAIRPERSON AND VICE-CHAIRPERSON
55. The Committee elected Ambassador Apiradi Ta ntraporn as Chairperson and re-elected
Minister Yoichi Suzuki as Vice-Chairperson of the Committee on Agriculture, by acclamation.G/AG/R/26
Page 11
Date of Next Meeting
56. The next regular meeting of the Committee on Agriculture will be held on 28 and 29 June
2001.  The airgram convening the meeting and containing the draft agenda will be issued on
Thursday, 14 June 2001.G/AG/R/26
Page 12
ANNEX
Page
Part I Summary of specific points raised on notifications and responses thereto - (29-
30 March 2001)13
(i) administration of tariff and other quota commitments (Table MA:1): Ecuador
(ECU/8); El Salvador (SLV/9);13
(ii) imports under tariff and other quota commitments (Table MA:2): Costa Rica
(CRI/8); Ecuador (ECU/9, ECU/9/Corr.1 and ECU/13); European Communities
(EEC/29); Iceland (ISL/16); Israel (ISR/21); Japan (JPN/58); Mexico
(MEX/11/Rev.1); Norway (NOR/27); Romania (ROM/15); South Africa(ZAF/30); Tunisia (TUN/20);14
(iii) use of the special safeguard (Tables MA:3 to MA:5):  European Communities
(EEC/24); Japan (JPN/59 and JPN/60); Poland (POL/36, POL/38 and POL/39);20
(iv) domestic support commitments (Table DS:1): Brazil (BRA/18); Cuba (CUB/11);
Cyprus (CYP/10); European Communities (EEC/26 and Corr.1; Israel (ISR/19);
Japan (JPN/61); Latvia (LVA/3/Rev.1); Malaysia (MYS/13); Malta (MLT/6);Mexico (MEX/7); Norway (NOR/30); Poland (POL/37); Romania (ROM/17);
Slovenia (SVN/4/Rev.2, SVN/5/Rev.1, SVN/8/Rev.1, SVN/12/Rev.1, SVN/14);
Tunisia (TUN/18);22
(v) new or modified domestic support measures exempt from reduction (Table DS:2):
Canada (CAN/40); Colombia (COL/23); Japan (JPN/62); Mexico (MEX/6);34
(vi) export subsidy commitments (Tables ES:1 to ES:3):  Colombia (COL/19/Corr.2);
Costa Rica (CRI/4/Add.1 and CRI/13); Israel (ISR/20); Korea (KOR/29); Norway
(NOR/28); Romania (ROM/16/Corr.1); Tunisia (TUN/21);39
(vii) export prohibitions and restrictions (Table ER:1): H ungary (HUN/24 and Add.1) 42
Part II Deferred replies to questions on notifi cations raised at previous meetings 43
(i) relating to imports under tariff and other quota commitments (Table MA:2): 43
Norway (NOR/27)            G/AG/R/25, page 16, refers.
(ii) relating to domestic support commitments (Table DS:1): 45
Costa Rica (CRI/7)           G/AG/R/25, page 19, refers
Malaysia (MYS/13)          G/AG/R/25, page 21 refers
South Africa (ZAF/29)     G/AG/R/24, page 20, refers
Attachments
1 NOR/27 – Monthly average internal prices for selected tariff quota products, 1999 48
2 BRA/18 – Justification of de minimis claims, 1998 49
3 TUN/18 -  Rates of inflation and exchange rate fluctuations, 1988-1999 51G/AG/R/26
Page 13
ANNEX
Review of Notifications by the Committee on Agriculture on 29 March 2001
Summary of Specific Points Raised and Responses Thereto
Table MA:1 Notifications
Ecuador    G/AG/N/ECU/8       Tariff quota administration   (Table MA:1)
Points raised by other Member s Response by Notifying Member
Australia:  Criteria established by the Committee on Tariff
Quotas for the allocation of import licences for whole
turkeys ; cuts and offal of fowls, frozen ;  milk in solid
forms ; flint maize, other ; grain sorghum, other ; wheat ;
barley ; malt.Given the diverse nature of the tariff quotas and importers,
the competent authorities have continuously monitored thefunctioning of the tariff quota administration system with aview to finding the most suitable method of allocation in
each case.   This has resulted in the promulgation of the
Interministerial Agreement no. 100 of 26 April 2000 whichstipulates how to manage, administer and allocate tariffquotas.  The Agreement adds clarity, efficiency and
flexibility in the administration mechanism applied to tariff
quotas of a diverse nature; it creates the Tariff QuotaCommittee which is responsible to assign, control andassess compliance in conformi ty with WTO rules.  The
allocation of licences is conducted on the basis of historical
import criteria and allows for the proportional distributionof tariff quotas.  The Tariff Quota Committee may decideto allocate licences on the basis of alternative criteria which
are commonly applicable and conform to WTO rules.
These alternative criteria are communicated in advance tointerested importers.
El Salvador     G/AG/N/SLV/9       Tariff quota administration   (Table MA:1)
Points raised by other Member s Response by Notifying Member
Australia:  In light of the c oncerns raised previously by
some WTO Members about the possible inconsistency of
public auctioning, whether other forms of tariff quotaallocation have been considered.The competent authorities are in the process of preparing a
detailed reply.
New Zealand:  Description of the system used to allocate
licences to individual companies;The allocation mechanism is set out in Chapter 3 in the
Regulations on the Opening and Administration of TariffQuotas.   The import licences are delivered by the Ministryof Economy within 10 days after the receipt of the
importer's application, provided an award certificate is
presented (this certificate is delivered by the StockExchange for Agricultural Products and Services -–BOLPROES).  The import conditio ns are stipulated in the
award certificate, including the volume allocated, the
validity period of the licence, and the deadline for effectingthe importation.
whether there are any domestic milk purchasingrequirements.A domestic purchasing requirement applies for a minimum
of 10,000 bottles of fluid milk per day.  This is a pre-
requisite should the applicant wish to have access to thetariff quota.
G/AG/R/26
Page 14
Table MA:2 Notifications
Costa Rica      G/AG/N/CRI/8    Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
New Zealand:
Reasons for substantial underfill, especially for dairySince 1995, tariff quotas have been filled to a varied,
though generally fairly limited, extent.  They have beencompletely filled on only one occasion, in the case of butterfat imports in 1995.  For all other products, tariff quotas
have never been filled completely, as was the case for 5 of
the 8 tariff quotas opened in 2000;  for the other 3 products,the maximum rate of fill reached slightly over 50 per cent.Nevertheless, fill rates have been increasing steadily sincethe tariff quotas were established.
Whether this is attributable to administration mechanism T he mechanism itself has not been shown to be deficient.
There have been factors limiting the fill rates, but these
cannot be attributed to the mechanism itself. Economic
operators may not be fully aware of this mechanism,although this cannot be attributed to a lack of promotionefforts, since many steps have been taken to publicize it.The mechanism is based on commodity-exchange
transactions ( Regulations on the Allocation of Tariff
Quotas , Executive Decree No. 23914-COMEX-MAG of 27
December 1994) and designed so that the State is notdirectly involved in the allocation and so that there is no
discrimination either in favour of, or against, any of the
participants. The Agricultural Commodity Exchange ( Bolsa
de Productos Agropecuarios, BOLPRO ), a private body, is
responsible for the administration of tariff quotas under the
supervision of the Ministry of Agriculture and Livestock
and the Ministry of Foreign Trade. In order to avoidinternal distortions, these Ministries may at their discretiondivide the quantity to be imported into one, two, three, four,
six or twelve-month periods, allocating a separate quantity
for each period. While this practice could make itpotentially expensive to import small quantities in certainperiods only, the decision to determine the periods is taken
with due consideration for the minimum value or quantity
of imports required to remain profitable. A public notice isposted in the Official Journal ten days prior to the openingof a tariff quota.  Authorized BOLPRO members look for
buyers (domestic importers) and suppliers (foreign
exporters) and help them to settle on a preliminary contractof purchase/sale, including the price, quantity andspecifications of the goods.  This aspect of the mechanism
could be biased towards foreign exporters which have
access to a domestic distribution network (e.g. fast foodrestaurant chains), to the detriment of exporters with nocommercial links. On the dea ling day, the preliminary
contracts are presented by BOLPRO members.  When the
auction takes place, BOLPRO awards the certificate to anyparty which submits a lower bid than the preliminarycontract. If no such bid is received, the preliminary contractwill eventually be accepted. Once a certificate has been
awarded, the goods have to be imported within a maximum
time-limit established by the Ministry of Agriculture andLivestock, and the licence is non-transferable.  To clear thegoods for import, the customs authorities require the
certificate awarded by BOLPRO as well as the ordinary
international trade documents.  The holder of a certificate isgranted the right to import a given quantity of the goodsconcerned at a lower tariff and during a specific period.
G/AG/R/26
Page 15
Costa Rica      G/AG/N/CRI/8    Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Whether Costa Rica has considered changing the
administration regimeG/AG/N/CRI/1/Rev.1 of 26 February 2001 updates the
previous administration regime. As the above explanationindicates, Costa Rica considers that this mechanism is both
effective and transparent, straightforward to use, allows any
interested party to participate and guarantees the non-intervention of the State. Costa Rica has not thereforedeemed it necessary to change it.
Ecuador   G/AG/N/ECU/9 and Corr.1;  ECU/13  Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia/New Zealand: Large variation in fill rates
between 1996 and 2000; Substantial levels of underfill,especially for dairyDuring 1996, Ecuador started to design a new regulatory
framework because there was no legislation in force for the
administration of tariff quotas prior to its adherence to the
WTO (February 1996). While the national legislation wasbeing adjusted to the WTO rule s, the rates applied to most
tariff quota products, especially cereals, were generally
below the scheduled in-quota rates.  Since July 2000, a 10
per cent rate has been applied to wheat imports, i.e. a rate
which is lower than the scheduled 19 per cent.  This led to a25 per cent rate of fill.  In 1999, the modalities used to
administer the tariff quotas were challenged by importersunder domestic legislation. The allocation mechanism wasthus suspended until the final ruling which had an impacton the fill rates. In the case of wheat, the allocation of the
tariff quota was made possible due to the introduction of a
provisional amendment. The economic crisis suffered byEcuador in 1998 and 1999 had an adverse impact on the
rates of fill, principally due to successive devaluations of
the currency.  The tariff quota for milk powders was under-
utilised in the period 1996-99 because duty free imports
were effected for an average quantity of 1,300 tonnes.
Australia/New Zealand:  Impact of administration method
on fill rates.-
European Communities      G/AG/N/EEC/29       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia/Philippines/United States: Underfill in 1999/2000
for the following tariff quota products:
Meat of bovine animals, fresh or chilled; frozen; edibleoffalCertain supplying countries cannot fill their share in the
tariff quota b ecause of lack of consumer demand for the
specific quality, or because they do not meet EC healthstandards.
Meat of swine; sausages; chicken carcass; cuts;poultry eggs; egg albumin; grape juiceThere was sufficient supply at attractive prices in the
internal market.
Cheese and curd There was a lack of economic interest to import these
products.
United States:  Impact of import requirements on livestockproducts.Import requirements on livestock products, other than those
linked to health and quality aspects, are not having animpact on the fill rates.G/AG/R/26
Page 16
European Communities      G/AG/N/EEC/29       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
United States: Pizza cheese  – Reasons for low fill rate;
impact of administration regime: time and quantity limitson licences, pro-rating of quantities and transferability oflicences.The low fill rate is due to a lack of economic interest to
import. The aspects of the administration methodmentioned in the US question should not have a negativeimpact on the fill rate.
Iceland      G/AG/N/ISL/16       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
United States:  Low fill rates in marketing years 1998/99
and 1999/2000 for the following commodities:
Meat products (bovine meat and edible offal; swine,
sheep; poultry; horses; bones and horn-cores)These minimum access commitments are subject to a tariff
quota system and, although they have been advertised twice
a year by the Ministry of Agriculture, they have attracted
very different levels of commercial interest. There is onlydomestic demand for imported beef and poultry.  Severalother more specific reasons may explain underfill, for
example: sanitary regulations, decrease in demand for
imported meat due to BSE, consumer preferences fordomestic products and a significant reduction in domesticprices since the base period, imports at in-quota rates thusbecoming progressively less attractive.
Potatoes The applied tariff quota is seasonal.  The import level tends
to fluctuate with the level of domestic production andsupply.  Consumers tend to favour domestic goods whenavailable.
Bones and horn-cores; cereal grains; starches; lardand other animal fats; groundnut oil; sunflower seed;
safflower or cotton seed oil; pasta; bran, sharps and
other residues; oil-cake and other solid residues;preparations used in animal feedThese products are not subject to any tariff quota system
upon importation, as mentioned in the cover page of the
notification but were included for transparency reasons.
Duties that are equal to or lo wer than the corresponding in-
quota rates apply.  In many instances, the applied rate iszero.  Demand is the only limiting factor as to the level of
imports.  For some products, changes in the Harmonized
System have had some impact due to reclassification.  Thedownsizing of the agricultural sector in recent years hashad a considerable effect on imports of animal feed.
Israel      G/AG/N/ISR/21       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia/United States:  Edible fats and oils  - Zero fill
rate; measures taken to ensure that true opportunities are
created in future or that the allocation is moved to other
products of demand.As previously noted during the June 1999 meeting in
connection with the review of G/AG/N/ISR/11, no tariff
quota system applies to this product.  The effective rate of
duty is 0.18 NIS per kilo, which is below the scheduled rate(which is above 3 NIS per kilo).  Real market accessopportunities therefore exist and there are no restrictions in
place.  Imports of edible fats and oils are notified for
transparency reasons.G/AG/R/26
Page 17
Israel      G/AG/N/ISR/21       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
New Zealand:  Other cheeses  - Demand for "other cheese" has increased for the past three
years.  However, this trend came to a halt in 2000, mainlydue to decreasing demand for premium cheese as a result of
the political situation and the dramatic effects on economic
activities. Another reason was the withholding of permitsby importers. In view of this situation, the Ministry ofAgriculture changed the allocation system from the tendersystem to first-come, first-served.  The effects are slow,again for reasons other than economic.
Underfill;
Steps taken with respect to Special Treatment underAnnex 5, para 5.Israel unilaterally tariffied the "other cheese" and
"processed cheese" tariff quotas at the end of 1998 in orderto foster competition.  On March 2001, a request was sent
to the WTO with a view to modifying Israel's Schedule
(G/MA/TAR/RS/78 refers).
Japan      G/AG/N/JPN/58       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
United States:  Mineral concentrated whey  – Steps taken
to modify current import policies in order to improvemarket access.The fill rate increased significantly from the previous year
because demand for calcium-fortified products has beenincreasing and because mineral concentrated whey isdrawing attention as a new milk-derived ingredient.  In
fact, a large number of newly developed by-products exist,
but at this stage, the use is limited to calcium-fortifiedproducts. In order to increase imports of mineralconcentrated whey, Japan would suggest (a) the expansion
of demand for calcium-fortified products and (b) to develop
demand for other products. However, it is not thegovernment but the private sector in exporting countriesthat should take steps to achieve one of these two options.
Mexico      G/AG/N/MEX/11/Rev.1       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Argentina:  Applied rates and volume of imports for the
following products: barley, maize, hard cheese, meat and
edible offal, animal fatsMexico undertook to provide an answer as soon as
possible.
Norway      G/AG/N/NOR/27       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
United States: Follow-up (G/AG/R/25 pp. 15-16 refers)  –
Internal prices on a monthly average for the period coveredby the notification for:
milk and cream; potato seeds; frozen strawberriescontaining added sugar or sweetening matter; fresh blackcurrants; barleySee Attachment no. 1.
nuts provisionally preserved; maize seed; bran sharps and
other residues of maizeThere is no domestic production and domestic prices are
thus not available.
frozen potatoes; fruits provisionally preserved There is virtually no domestic production for these products
and no domestic price registration is available.
G/AG/R/26
Page 18
Romania      G/AG/N/ROM/15       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia:   Beer  – Significant underfill in 1998 and 1999 This is due to a lack of import interest.  No request for
allocation was refused and no complaint from importers hasbeen registered so far.
New Zealand: Scheduled tariff lines that are subject toreduced levels of customs duties:
Notification of in-quota imports for all An addendum will be submitted for transparency purposes.
Confirmation that reduced duties were applied on an
MFN basisConfirmed.  Additional tariff quotas were opened for
imports under preferential arrangements (EU and CEFTA).The duties applied on preferential imports were lower thanthe applied in-quota rates, which explains underfill.
New Zealand: Phasing mechanism used to expand tariffquotas to their end volumes (G/AG/R/18, p. 18 refers)-
South Africa      G/AG/N/ZAF/30       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia/Canada/New Zealand/Switzerland: underfill of
following tariff quotas for dairy products:
Milk powder; butterIn general, South Africa experienced an over-production in
these dairy products in 1999.  The resultant surplus on the
local market contributed to the underfill.
Milk and cream fresh No duty applies on imports of milk and cream, fresh.
Cheese Total imports declined sharply by 44 per cent between
1997 and 1999.  The constant weakening of the Rand led toa rise in prices for imported cheese, resulting in a decline indemand.
Whey
Canada noted that fill rates have been low ever since a
method where historical importers are the sole entities
eligible to apply for import permits has been introduced -
Whether consideration has been given to revert to a tariff-only regimeSee general reply above.  South Africa is not considering to
revert to an applied tariff regime as the notifiedadministration procedures do not restrict the utilization of
the whey tariff quota.  Importation under this tariff quota,
and in general under all tariff quotas, is not restricted tohistorical importers only.  A certain portion is set aside fornew importers.
Australia:  Underfill of following tariff quotas:
Eggs; potatoes; sunflower seed South Africa is normally a surplus producer in these
products. The over supply contributed to the underfill.
Furthermore, the applied rates were lower than or equal tothe in-quota tariff rates. No tariff quotas were opened forthese products because all imports occurred at the appliedrate of duty.
Malt extracts The difference between the in-quota rate (19 per cent) and
the applied tariff rate (20 per cent) is minimal.  Importerstherefore did not undertake the task to apply for permitsand most imports took place under the applied rate of duty.
G/AG/R/26
Page 19
South Africa      G/AG/N/ZAF/30       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Rapeseed Imports have been generally very low in the
implementation period (on average, less than 100 tonnesannually, since 1995).   Traditional preference for other
oilseeds for oil and feed appear to contribute to a lack of
demand for this product.  Furthermore the applied rate forrapeseed has been equal to the in-quota tariff rate.  A tariffquota was therefore not opened.
Additional remarks by South Africa: As a general response to the above questions, South Africa pointed out that the
foreign exchange situation has contributed to the under filling of import quotas for many products.  Between 1997 and
1999, the value of the Rand declined by approximately 33 per cent when compared to the US Dollar.
Tunisia      G/AG/N/TUN/20       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia/New Zealand: Underfill of the following :
Bovine meat; calves and bullocks; sheep meat
Dairy :  milk powder, butter, cheeseImports under the various tariff quotas are a reflection of
market demand and the fact that, for the products andperiod in question, few importers had expressed anintention to import.
New Zealand:  Whether Tunisia is considering moving to atariff-only regime for the above tariff lines.Tariff quotas were opened in accordance with Tunisia's
commitments in this area and the modalities adopted for theadministration of tariff quotas.
New Zealand: Shelled almonds  and Tomato concentrate  -
Phasing mechanism used to expand these tariff quotas in1998 and 1999: submission of related corrigendaThe related corrigendum is under preparation.G/AG/R/26
Page 20
Tables MA:3 to MA:5 Notifications
European Communities    G/AG/N/EEC/24     Summary of Special Safeguard Actions (Table MA:5)
Points raised by other Member s Response by Notifying Member
United States:  Fruit and vegetables  – ( Follow-up
question, G/AG/R/24, p. 10 refers ) In view of the fact that
all the commodities in question were subject to a volume-based safeguard, submission of related MA:3 notificationThe EC confirmed that the volume-based SSG had not been
invoked. Therefore no action was taken. Since 1996, thetrigger volumes are published annually (Regulation1555/96).  The latest set of trigger volumes was publishedin Regulation 2893/00.
Japan     G/AG/N/JPN/59  and JPN/60    Volume-Based Special Safeguard (Table MA:3)
Points raised by other Member s Response by Notifying Member
Australia: Inulin  (JPN/59)
Tariff rate applied prior to the application of the SSG; The out-of-quota tariff rate applied prior to the application
of the SSG was 119 Yen per kg.
Rate of additional duty being levied; volume of tradeaffected so far;Additional duty: 39.67 Yen per kg.   Volume of trade
affected : 0 tonne.
Monthly imports of inulin from April 2000 to the time of
application of the SSGFrom April to November 2000, the monthly imports were,
respectively (tonnes) : 0, 38, 53, 15, 34, 15, 45, 57.
Australia: Butter milk powder  (JPN/60)
Tariff rate applied prior to the application of the SSG; rate
of additional duty being levied; volume of trade affected
so farSee table below for detailed information on applied rates.
Volume of trade affected: 0 tonne.
Tariff rate applied prior to the SSG
HS number Fat content
Solid forms OthersRate of additional
duty levied as a
result of SSG
0403.90-113, 118 Fat <=  1.5 % 29.8% + 92 Yen/kg. 29.8% + 396 Yen/kg. 9.9% + 132 Yen/kg.
0403.90-123, 128 1.5 % < Fat <= 26 % 29.8% + 123 Yen /kg. 29.8% + 582 Yen/kg. 9.9% + 194 Yen/kg.
0403.90-133,138 26 % < Fat 29.8% + 189 Yen/kg. 29.8% + 1,023 Yen/kg. 9.9% + 341 Yen/kg.
Poland          G/AG/N/POL/38      Volume-Based Special Safeguard (Table MA:3)
Points raised by other Member s Response by Notifying Member
1. Bran sharps and other residues;  2. Hop cones; lupuli; other;  3. Butter and other fats and oils; dairy spreads; whey butter
Australia/New Zealand:
Tariff rate applied prior to the application of the SSG Prior to the introduction of the SSG, the tariffs applied to
imports under tariff quota were equal to those listed inPoland's Schedule.   The out-of-quota duties were equal tothe bound duties.
G/AG/R/26
Page 21
Poland          G/AG/N/POL/38      Volume-Based Special Safeguard (Table MA:3)
Points raised by other Member s Response by Notifying Member
Rate of additional duty being levied; volume of trade
affected so far;The additional duties were calculated in accordance with
the relevant provisions of the Agreement on Agricultureand did not exceed one third of the respective bound duties.
Bran: 8 per cent. Hop cones: 17 per cent. Butter: 34 per
cent.  Data on the volume of imports subject to the SSG arenot processed on a regular basis and are not presentlyavailable.
New Zealand:
Given that no, or minimal, access was realized in theperiod 1997-99, confirmation that  imports were effected
at SSG-inclusive rates which were less than or equal to
the in-tariff quota rates in the years 1997 through 2000
If imports were subject to duties higher than in-quotarates, explanation of why the tariff quotas were not filled
prior to the imposition of the higher tariff rate, and how
the use of the SSG is consis tent with Article 5 para 2.See above reply. The tariff quotas were opened at the
beginning of the year 2000 and opportunities to import at
the in-quota rate were granted.  The SSG duties were not
applied to imports under tariff quotas.
Australia: Hop cones; lupuli; other – Apparent
discrepancy in reported volumes of imports in POL/28This discrepancy arises from an error in POL/28 corrected
by Poland (G/AG/R/22 p. 16 refers).  The years were
corrected in the following manner: the dates used for thecalculation of the trigger level on page 2 should read: 1996,1997 and 1998.
Poland          G/AG/N/POL/36 and POL/39      Price-Based Special Safeguard (Table MA:4)
Points raised by other Member s Response by Notifying Member
Australia: Wheat or meslin flour; cereal flours other
than wheat or meslin
Volume of imports affected by the SSG Data on the volume of imports subject to the SSG are not
processed on a regular basis and are not presently available.
Rate of additional duty being levied The additional duties differed according to each shipment,
according to price. No information is presently available.
G/AG/R/26
Page 22
Table DS:1 Notifications
Brazil   G/AG/N/BRA/18      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada:  Exchange rate used for currency conversions. See data provided in Attachment no. 2
Development Programmes – S&D
Canada:  Credit programmes – Reporting of certain
programmes in the present notification; estimation and
amount of support (WT/TPR/S/75 of September 2000refers)The amounts of support for PRONAF and FINAME were
estimated according to the met hodology discussed under
the EGF section below.
PRONAF The PRONAF (Programme to Strengthen Family Farming)
is a “family farming” credit programme generally available
to low-income or resource-poor producers.  It is based on
Article 6.2 and has been notified in the ST/DS:2.  Theestimated value of the related support in the relevant periodwas US$ million 84.9 in production credit modality andUS$ million 15.7 in investment credit modality.
FINAME The “FINAME Agrícola” is a credit programme that
provides loans to investments in agricultural activity.  It isgenerally available to all producers, in conformity with
Article 6.2.  It is thus included in the ST/DS:2 as
“Investment credit”. The estimated value of the supportprovided by this programme in the relevant period isUS$ million 41.2.
MODERFROTA and AGREGAR MODERFROTA was launched in February 24, 2000 by
Resolution No. 2699 of the Brazilian Central Bank.AGREGAR was launched in June 17, 1998, by the
Resolution No. 2507 of the Brazilian Central Bank.  For
that reason,  neither was included in the notification underexamination, which covers the crop year 1997/98.
Canada:  "Production credit" – Difference between the
programmes notified in ST/DS:2, and those notified inST/DS:7 or ST/DS:9.The “production credit” support notified in ST/DS:2
includes support given through credit programmes
generally available to low-income or resource-poorproducers (e.g., PRONAF and PROCERA). The
“production credit” reported in ST/DS:7 or ST/DS:9
benefits producers through programmes as defined inAnnex 3 (Amber box programmes, subject to reductioncommitments).
AMS
Canada: "Policy of Guaranteed Minimum Prices" (PGPM)
- Description of support granted under two programmes;calculation methodology; reporting in present notification(WT/TPR/S/75 refers)
AGFThe AGF support is calculate d using the gap between the
fixed external reference price, based on the average of theperiod 1986 to 1988 (as scheduled), and the applied
supporting price multiplied by  the quantity of production
eligible to benefit from the applied supporting price. Asnoted in the WTO Trade Policy Review of Brazil(WT/TPR/S/75), the PGPM is still in force, but since 1996
it ceased to be automatic and generalized. Therefore, as
noted in the same TPR document, the AGF is applied onlyfor specific products and regions where the FederalGovernment deems it necessary to support prices, or when
it is deemed necessary to form stocks. These values are
presented in the ST/DS:5.
G/AG/R/26
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Brazil   G/AG/N/BRA/18      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
EGF Since the sale option to the Government (EGF/COV) has
been eliminated in the 1996 crop year, the EGF does nothave a role of support price.  It is a loan programme whichgrants preferential interest rates to producers, thus allowing
them to retain their production in order to market it in a
more favorable period. As credit is an “input” toagricultural activity, the support is measured in accordancewith Annex 3 para 13, i.e. “ the gap between the price of the
subsidized good or service and a representative market
price for a similar good or  service multiplied by the
quantity of the good or service ”. EGF support is thus
calculated using the gap between the reference interest rate
and the interest rate paid by producers multiplied by the
volume of EGF credit during the average period ofutilization, which is established in specific regulations.These values are notified as “Marketing credit”, in ST/DS:7(specific products) and in ST/DS:9 (non-product-specificsupport).
Japan: Edible beans, soybeans  – Status of market price
support in 1997/98The market price support is given by the Federal
Government Acquisition (Aquisições do Governo Federal
(AGF)), which allows farmers to sell their products to the
Federal Government. However, as indicated above, theAGF programme is not automatic and generalized and it isapplied only for specific products and regions where the
Federal Government deems it necessary to support prices,
or when it is deemed necessary to form stocks.  This wasnot the case for those products in the notified period and sothere was not "eligible production" to report on in ST/DS:5.
Japan: Sugar cane  – Operation details; whether the
programme was introduced in 1997/98.This programme has been implemented since 1 November
1998 when it was introduced by “Portaria” MF 275/98.This is a fixed direct payment limited to sugar cane
producers of the north-east region, the country’s poorest
region. The programme benefits some 10.3 thousandproducers in that region (about 17 per cent of all Braziliansugar cane producers). The payments made in the 1998
crop year represent approximately 1.4 per cent of the total
value of Brazilian sugar cane production.
Australia/Canada/New Zealand/United States: information
to substantiate de minimis  claims on product-specific as
well as on non-product-specific Amber box supportSee Attachment no. 2.
Cuba   G/AG/N/CUB/11      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Australia/Canada/New Zealand:      Domestic food aid:
"Compensation for agricultural producers" -
Whether this is a new measure; if so, related Table DS:2 Confirmed. A Table DS:2 notification will be shortly
submitted.
G/AG/R/26
Page 24
Cuba   G/AG/N/CUB/11      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Programme details; consistency with Annex 2 para 4:
reason for the need to compensate producers sincepurchases should be made at market prices.The programme " Retail price subsidy for certain products
that constitute the basic food basket " exists since 1981
and has been implemented in accordance with Annex 2para 4 criteria.  The new programme element however is
an input subsidy which is generally available to low-
income or resource-poor producers.  It complies withArticle 6.2.  This subsidy is designed to keep wholesaleprices of the basic foodstuffs at an affordable level bycompensating agricultural producers.
Cyprus     G/AG/N/CYP/10      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green Box
Structural adjustment through resource retirement
Australia/New Zealand:  "Package of measures to limit/-
stabilize dairy and beef production"
Raised concerns regarding the continued notification of
this package as being consistent with both Blue and Green
Box criteria;A corrigendum will be submitted to remove this technical
error. This is a structural adjustment programme leading tothe permanent reduction of the number of milking cows.Although the programme has the effect of limiting
production, this is a consequence of the retirement of
resources rather than of specific production-limitingprogramme, as envisaged under Article 6.5.
Cyprus is a  heavy net importer of dairy products and beef.
However, in the mid-1990s it was faced with a heavy
disequilibrium in supply and demand. The Governmentthen chose to finance a programme leading to the reductionof the number of dairy cows coupled with a requirement to
slaughter all meat animals at a young age, in an effort to
reduce domestic production of beef too. The programmewas very successful, and imports not only continued asbefore, but also increased considerably. The technicalities
are such that the programme requires permanent rather than
temporary retirement of resources: dairy farmers tend tokeep all their heifers in the herd until first calving in orderto test their milk yielding capacity. Then they decidewhether to keep them as replacements or to sell them for
meat. If there is no secure outlet for cow beef, these
animals remain in the herd and farm size inevitablyincreases. This is why the Go vernment chose to subsidize
the disposal of de-boned cow beef and to encourage the
slaughter of male and female stock below the age of 12-14
months.
According to Australia, as the measure is related to the
type and quantity of production, it does not comply with
Annex 2 para 10.Assistance paid in this connection does not amount to
payments related to the type or quantity of production, but
to payments made on condition that resources are removedfrom production.
G/AG/R/26
Page 25
Cyprus     G/AG/N/CYP/10      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Regional Assistance
Australia/New Zealand:  "Wine Grape Area Subsidy" -
Conformity with para 13(a)Para 13(a) prescribes that payments shall be limited to
producers in disadvantaged regions, considered as such onthe basis of neutral and objective criteria. The wine
growing area of Cyprus is a contiguous geographical area
considered disadvantaged on the basis of the followingobjective criteria and facts. It is a hilly and mountainousarea, with very poor calcareous soils, the total lime content
of which goes up to 70 per cent. Vine holdings have an
average size of 0.8 ha and the average family income in theregion, though supplemented heavily from non-agriculturalsources, does not exceed 60 per cent of the national
average. Despite this subsidy scheme, the population of the
wine growing region decreased by 45 per cent between1973 and 1992, and the production of wine grapes declinedby almost 50 per cent during the last ten years. In fact, thetotal acreage under grapes went down from 32,000 ha in
1980 to 17,255 ha in 1999. Most of the abandoned
vineyards were not put into any other agricultural use, andvery heavy damage was thus caused to the environment andtraditional landscape. Abandoned land was exposed to soil
erosion and disastrous fires, and there are indications that
the bio-climatic balance of the whole region was affected.In view of all the above, this particular region of Cyprus,commonly referred to as the wine growing region, fullysatisfies para 13(a) criteria.
Conformity with para 13(b) It is first important to stress that para 13(b) does not
mention the factors of production as implied by Australia's
question. Reference to production factors is made only in
para 13(e), which refers to a threshold level for payments tobe effected (See next section). Since wine grapes growingis practically the only sizeable farm activity in this region,
and has been so since ancient times, paying an area subsidy
to grapes does not amount, in Cyprus' view, to givingpreference to this type of production. It is rather a targetedregional assistance programme which benefits every single
farmer in the region, but excludes those who own land
which has been left idle. Extending the subsidy to all theland would not only double the cost of the scheme, it wouldalso have the effect of transferring funds to people who do
not live in the country, but maintain ownership of the land
for speculation or other purposes not related to agriculture.It is also important to note that since the region's traditionallandscape and environment are very closely related to vine
growing, the area subsidy amounts to a targeted and
transparent environmental programme, which also satisfiesmost of the requirements of para 12.  Cyprus believes that itwould have been quite legitimate in the context of a
regional assistance or environmental programme if
production were maintained at the level of the base period,but this is not true at all in this particular case: production
of wine grapes has fallen from 182,000 tonnes in 1989 to95,000 in 1998.
Conformity with para 13(e) The threshold referred to in this paragraph was not fixed by
Cyprus because of the very small average size of the vineholdings - eight tenths of a hectare, as previouslymentioned.
G/AG/R/26
Page 26
Cyprus     G/AG/N/CYP/10      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Conformity with other subparagraphs of para 13 These requirements are also satisfied. Payments are not
related to prices, whether domestic or international.Payments are available to all producers in the region and,
as evidenced  by the continuing decline of the acreage
under grapes, they only compensate farmers for the extracosts or loss of income involved in undertaking productionin the region concerned.
United States:  Whether non-grape-growing farmers arealso eligible for this regional assistance scheme.Apart from wine grapes and a few scattered rain-fed olive
and almond trees, nothing else can be grown economicallyon these soils. Consequently, there is hardly any farm in theregion that is not engaged in vine growing as its main
activity. Olive and almond growers receive assistance from
other schemes.
Australia/New Zealand: Whether the following options
have been considered: (a) reclassification into the AMS; (b)
policy options that fit within the scope of Annex 2.
Additional remarks:  New Zealand , supported by Australia ,
stated that this was not the appropriate forum to debate on
the deficiencies of  the existing Agreement on Agriculturein meeting important societal objectives. These issues will
be dealt with in the context of the mandated negotiations.
Domestic support measures need to be notified accordingto the current rules.Cyprus is actively seeking alternative solutions to help the
farmers and maintain the environment in the traditional
wine grapes growing area. A number of proposals weretabled in the past, but none of them proved to be viableafter thorough scrutiny. The continuing problems and
difficulties faced by farmers in this particular region are a
case that a future Agreement on Agriculture must providemore flexibility. This is especially so when importantsocietal goals such as the maintenance of a living
countryside and the protection of the environment are
threatened. At the same time, Members must be careful notto set rules and criteria having in mind only one particularsituation and to expect then that they will be universallyapplicable and always correct to the letter.
Development Programmes – S&D
Investment subsidies
Australia:  Consistency of measures with Article 6.2;confirmation that these measures are generally available toall types of agriculture.These subsidies comply with Article 6.2 because they are
paid to farmers in the framework of development
programmes, either as subsidies on the interest of loans, or
as direct assistance to promote the restructuring andimprovement of farms.  Subsidies of all three categories aregenerally available to all farms and aim to achieve specific
developmental goals and to improve the structure and
viability of farms.
Category (iii) This assistance aims to promote the restructuring of citrus
and other deciduous fruit orchards. Although restructuring
may involve replanting with more promising varieties orwith trees requiring less water, in more than 95 per cent ofthe cases farmers responded by uprooting old and
unproductive orchards and refrained, so far, from planting
new trees. It is worth mentioning in this connection thatexports of citrus fruit fell by 30 per cent during the lastdecade, while imports of apples, pears and stone fruitcaptured a sizeable share of the domestic market after 1995.
Category (iv) This aid encourages the use of improved animal breeding
stock and the conservation of rare breeds of animals facingimmediate danger of extinction. This programme couldhave been notified under paragraph 12 of Annex 2 .
Category (v) These subsidies are paid in the framework of an integrated
livestock development project involving investment in the
relocation and modernisation of livestock farms, the
treatment of effluents, etc.
G/AG/R/26
Page 27
Cyprus     G/AG/N/CYP/10      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
New Zealand: Category (vi) – Submission of Table DS:2
notification describing this new programme.This is not a new programme but an existing development
project involving subsidies on the interest of loans toimprove the efficiency and productivity of agricultural
holdings. In previous notifications, it was presented under
ST/DS:1, General Services, sub-paragraph (viii):Infrastructural Services – Rural Development. As from thisyear, it was considered more appropriate to notify it underST/DS:2 – Investment subsidies generally available toagriculture.
Input subsidies
Australia: Category (i) - Confirmation that the subsidies are
generally available to all low-income or resource-poor
producers in accordance with Article 6.2.Confirmed.
AMS
Australia:  Barley; Livestock products  – Basis for
assigned external reference prices.Cyprus continues to use the fixed external reference price
for barley contained in its original Schedule of Concessions
and Commitments under the Uruguay Round Agreement onAgriculture. There is no external reference price forlivestock products.
European Communities   G/AG/N/EEC/26 and Corr.1     Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green Box
United States: "Marketing and promotion services" –
(Follow-up G/AG/R/25, page 19, refers )
Whether all funds (including operational funds, financing
for special promotion programmes, quality improvement,etc.) granted to producer organizations (POs) by memberStates and the EC, meet the Green Box criteria;The expenditure notified in the Green Box concern the aid
for the establishment of the PO as specified in Article 14 ofRegulation 2200/96 and the operational programmes asspecified under Article 15.4 of the same regulation.
In the absence of a detailed breakdown of expenditures bytype of activity and beneficiary commodity, explanationof how the EC Auditors ensure that specific Green Boxcriteria are being met;The conformity of spending in the context of the
operational programmes is checked by the competentauthorities in the EC and in member States.  Furthermore,
this expenditure (EAGGF-Guarantee expenditure) is
subject to a posteriori  controls following the Clearance of
Accounts procedure.  The expenditure meets the Green Boxcriteria.
Amount of funds (administrative and operational funding)provided to each specific fruit and vegetable PO(including individual POs such as citrus or appleproducts)The global expenditure for the operational programmes
referred to in the first reply above was Million ECU 239.Data per PO is however not available.
Whether funding for the POs can be used for capitalexpenditures;Yes.
Confirmation that, except for a few crops such as olives
which receive a direct appropriation in the EC agriculturalbudget, fruit and vegetable growers receive price supportfunding only through POs; if not, details on how fundingis provided.Confirmed.
G/AG/R/26
Page 28
Israel   G/AG/N/ISR/19      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
AMS
Australia: Basis of the external reference prices assigned to
the notified commodities; base period used.Israel used the general rules and modalities to determine
the base period reference prices indicated in ST/DS:5.Israel confirms that these are based on the average prices ofthe period 1986 to 1988.
Japan:  Poultry meat  – Reason why "eligible production"
to receive market price support is recorded as "zero" in1999.As notified in ISR/17, AMS support for poultry meat was
shifted to the Green Box category under the programme"Payment for meat of poultr y producers in the Galilee
Area ".  In 1999, the total production was 260 thousand
tonnes, but was not eligible to receive any s upport.
Japan   G/AG/N/JPN/61      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green box
United States:  "Infrastructural services for the agricultural
sector and rural areas"
Reasons for increased expenditures in FY 1998In FY 1998, supplementary budget appropriations were
made.   These aimed to revitalize rural and mountainousvillages facing serious economic conditions; ensure thebalanced development of national lands; and improve the
infrastructure in less-developed rural and agricultural areas.
This led to an increase of the total budget compared to theprevious year.
Details on allocation of expenditures The breakdown of the total 1,800.7 billion Yen is as
follows : (a) construction and rehabilitation of irrigationand drainage facilities, including dams and otherinfrastructure: 1,069.9 billion Yen; (b) construction and
rehabilitation of rural sewerage facilities and rural roads,
etc. : 739.8 billion Yen.
Land consolidation programme: objectives; eligibility
criteria; beneficiaries; eligible crops; consistency with
Annex 2 para 2The purpose of the land consolidation programme is to
build irrigation and drainage facilities, including sewerage
and rural roads, to readjust land use, and to create publicland. This public project benefits everybody, and ruralsocieties in particular. The programme does not target
specific products. The programme sets a civil engineering
standard in accordance with the geographical conditions ofthe land and is implemented only when such a standard ismet.  The measure meets Annex 2 para 2(g) criteria:  it is
provided through a publicly-funded government
programme; it does not have the effect of providing pricesupport to producers; it does not involve direct payments toproducers or processors; its objective is to promote ruraldevelopment.
Blue box
Brazil: Whether the introduction of this type of support
reflects a new trend in national domestic support policies.This question was not conveyed to Japan prior to the
meeting.  However, please refer to the review of JPN/62, inthe following section,  under "Table DS:2 notifications".G/AG/R/26
Page 29
Japan   G/AG/N/JPN/61      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
AMS
Brazil: Reasons for the decrease in the Total Current AMS
in FY 1998, compared to the three preceding years.This question was not received prior to the meeting and
was not reflected in the convening airgram. The Japanesedelegation indicated that this question was already coveredby its responses to the questions concerning the abolition ofmarket price support for rice.
Canada/New Zealand :  Rice  - Background for market price support for rice: The Food
Control Law was abolished in 1996 and the Staple Food
Law was introduced.  Subsequently, detailed operational
rules were provided in the Ne w Rice Policy in 1998, in line
with the Staple Food Law.  The objective of this series ofreforms was the abolition of government control on all the
rice in distribution, an activity which had been carried out
for more than half a century.  As a result of this reform, the
rice distribution system was left to the private sectorwithout government intervention.
Reason why no market price support is reported in FY1998;As a result of the rice policy reform, the administered price
for rice was abolished. Previously, all domestically-produced rice was eligible for government purchases.
After the reforms, government purchases were only limited
to the minimum necessary to form public stockholding forfood security purposes, and the purchase prices for thestockholding were set at actual market prices.  Furthermore,
the price band system applying in the domestic market was
abolished.  As a result of these changes, the market pricesupport system for rice was entirely eliminated by the endof FY 1997, which is why no market price support isreported in FY 1998. Rice prices now reflect the actual
supply and demand situation prevailing on the domestic
market.
Consistency with information published in OECD reports;
estimated value of market price supportThe " government purchase price " referred to in OECD
reports is the price at which the government purchases rice
to constitute public stocks for food security purpose.  This
price is therefore not at all the "administered price".  Thisprice is set on the basis of the actual market price (seeabove explanation).  Furthermore, the concepts and terms
used in the OECD Monitoring and Evaluation report are
not necessarily consistent with those used in the WTO.  It istherefore not appropriate to use them interchangeably,especially when discussing the AMS in the WTO context.
Latvia   G/AG/N/LVA/3/Rev. 1      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States: Wheat  – Reason why the external reference
price (ERP) has increased compared to the originalnotificationThe ERP was incorrectly shown in the previous notification
because the price of wheat sold in 1999 was taken as a
basis for calculation.  Since the base period for the
calculation of domestic support is 1994-96, as per Latvia'sProtocol of Accession, the average world price of wheatduring the period 1994-96 is taken as the ERP in the
revised notification.  The source of data is the International
Grains Council.G/AG/R/26
Page 30
Malaysia   G/AG/N/MYS/13      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States:   "Price subsidy and guaranteed minimum
price" -
Explanation of how Annex 2 para 6(e) criteria is met
since producers appear to receive the benefit upon
delivering  100 kg. of rice to a licensed mill or drying
facility;These subsidies have no trade distorting effects.  As stated
in earlier replies, these are income support measuresprovided to a group of poor farmers in the hardcore poorcategory of Malaysians in the context of socio-economic
redressal.  The average size of the paddy farm is 1.5 to 2
acres. The subsidies are not seasonally or annually adjustedto take account of world prices.
Malaysia is asked to reconsider this notification sincepayments appear to be linked to production.The payment is not tied to the level of production.
Payment is only made to those farmers who sell theiroutput to licensed mills or drying facilities for acc ounting
purposes.  In so doing, farmers are discouraged fromselling their output to unscrupulous traders.
Malta   G/AG/N/MLT/6      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Australia/New Zealand:  "Guidance and guarantee – Beef" Background: Malta is a net-food importing country and
does not have any beef production. Beef production
accounts for around 12-14 per cent of the nationalconsumption needs and is only a by-product of the dairyproduction.  The total expenditure under this programme
would represent less than 1.3 per cent of Malta's total
imports of meat in 1999, mainly from Australia and NewZealand.  Given its size and population density, Maltacould not accommodate any pr oduction ambitions.
Operation details The scheme entails very small direct payments to producers
and allows Maltese veterinary authorities to monitor thehealth of the national herd. The scheme also helps inprotecting the rural environment as it ensures that animalsare slaughtered in authorized places only.  Producers do not
receive payments on a regular annual basis but rather upon
the retirement of the animal.  The number of animals thatcan be kept by any given producer is subject to a quota (seeadditional information below on the use of quotas).
Confirmation that payments are not based on the type orvolume of production, in accordance with Annex 2 para 6Confirmed.
Clarification needed as this programme appears to fix
production at a certain level (fixed quota) and require
production (i.e. animal replacement) to receive paymentThe payment is effected when an animal is slaughtered on
health grounds even if the retired animal is not replaced.
Hence, there is no production linkage for eligibility to suchpayment, as per Annex 2 para 6(e).  The fixed quotafunctions more as a ceiling which has been dictated by
geographical and historical conditions, given the small size
of Malta (320 square km.) and its historical evolution (thequotas were introduced by the British Colonial experts inthe 1930s).  Farmers are free to reduce their herds as they
deem best and the scope of the quota is not linked to
production.
G/AG/R/26
Page 31
Mexico   G/AG/N/MEX/7     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States:  The questions posed during the November
meeting of the Committee were reiterated ( G/AG/R/25 pp.
21-23 refers ).The Delegation of Mexico undertook to provide responses
as soon as possible.
Norway   G/AG/N/NOR/30     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
New Zealand:  Noted that negative non-product specific
AMS was again offset against current total AMS.  NewZealand does not consider this approach to be consistentwith AMS provisions  –
Confirmation that taxes on fertilisers and pesticides
shown in ST/DS:9 are imposed for environmental reasonsConfirmed.  The taxes on fertilizers and on pesticides are
introduced in line with the "Polluter Pays Principle".  Theyare specific to agriculture and their purpose is to discourage
producers from excessive use of these inputs.  These taxes
were included in the Norwegian Schedule, as well as inprevious notifications.
if so, justification of Norway's inclusion of environmentalsubsidies in the Green Box while claiming credit forenvironmental taxes under the AMS.The above taxes were deducted in conformity with Annex 3
para 4 ("specific agricultural levies or fees paid by
producers shall be deducted from the AMS".)  Norway
believes that the classification of subsidies into various
categories by the Agreement on Agriculture is not based on
the purpose or objectives of the subsidies but on the wayvarious subsidies are paid to producers. Thus subsidies withenvironmental objectives have not only been included inthe Green box.
Poland   G/AG/N/POL/37     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green box
United States: "Animal health control and protection" -
Meaning of " supply of vaccines " in terms of who are the
recipients and providers.Vaccines are received by farmers and are paid from state
funds.  The list of diseases concerned is published by the
Polish Veterinary Service.
Australia/United States:  "Structures and infrastructure" –
Programme details and consistency with Annex 2 para 11;
Reason why payments for environment protection are notnotified in the context of para 12.The first component indeed consists in investment aids for
farmers linked to structural disadvantages: funds allocatedto the purchase of land by government agencies, funds for
programmes related to the process of integration into the
EU.  The second component relates to various governmentservices, e.g. amelioration of water supply and wastetreatment.
United States:  Subsidies to Polish artificial insemination
stations -  Whether these are included in the notification.The funds concerned are only targeted to selected animals
which are donors of semen.  They are not intended toreduce the costs of artificial insemination which arecovered by the farmers themselves.
AMS
Australia:  Butter, honey  – Basis for external reference
prices (ERPs); whether these are based on the years 1986-88.In 1986-88, trade in Poland was distorted by the application
of some administrative measures linked to the politicalsystem.  ERPs were therefore taken from EUROSTAT.
United States:  Whether the amounts listed as " eligible
production " reflect the actual purchases or the quantity of
production eligible to receive the applied administeredprice, as per Annex 3 para 8.The amount of production reflected in the notification is
that which is purchased by the  state agency.G/AG/R/26
Page 32
Romania    G/AG/N/ROM/17     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
Australia: Conformity of measures with Annex 2;
"Direct payments to producers"
"Subsidies for general inputs" : Australia noted that input
subsidies for developing country Members should be
notified under ST/DS:3These two categories of measures were included in
Romania's AGST Table 4, " measures exempt from
reduction commitments ".  There is no need to notify these
measures under Article 6.2, since they are in fullconformity with Annex 2, paras 1, 5 and 6.
Slovenia    G/AG/N/SVN/4/Rev.2, SVN/5/Rev.1, SVN/8/Rev.1, SVN/12/Rev.1
Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States:  Milk and cream ; sugar beet  - Reason why
the market price support payments have been excludedfrom the revised ST/DS:5.Milk and cream: This is because the applied administered
prices were in all years lower than the notified external
reference price, which was based on the average prices of1992 and 1993.
Sugar beet : Administered prices were eliminated from
1998 onwards. When the domestic support notification for
2000 is prepared, a corrigendum will also be submitted toreflect market price support for the years 1995-98.  The
calculations show that Slovenia is well below its AMS
commitments for the respective years.
Slovenia   G/AG/N/SVN/14      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States: Wheat flour  – Reason for eliminating
information on market price support in 1999.In the process on ongoing agricultural reform, Slovenia has
made a significant shift away from market support to more
decoupled forms of assistance to farmers, such as direct or
compensatory payments. The administered prices for wheatflour were eliminated in 1999.  In 2000, no administeredprices applied either and the minimum reference buyingprice was set so low that it was virtually unused.
Tunisia         G/AG/N/TUN/18      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green box
Australia: "Budgetary funds to support small farmers" –
Nature of this programme.-G/AG/R/26
Page 33
Tunisia         G/AG/N/TUN/18      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
AMS
Australia/New Zealand:  Adjustment of external reference
prices -
Justification; reasons why inflation rates are consideredexcessive; information and data sourcesTunisia considers that inflation and the depreciation of the
national currency against foreign currencies recordedbetween 1988 and 1999 were excessive and justify theadjustments made.  The cumulated rate of inflation between
1988 and 1999 could be as high as 60 per cent since the
rate of inflation as measured by the movement of thegeneral CPI has ranged between 5-7 per cent per annum,only decreasing to around 3 per cent in the last three years.
The rate of inflation in Tunisia is published in the annual
report of the Central Bank (Table 1,  Attachment no. 3 ).
The exchange rate used to determine reference prices forthe base period 1986-88 in national currency has also
fluctuated to a considerable extent.  Whereas the Tunisian
dinar was worth US$0.88 for the base period, it had risen toU$1.19 by 1999.  These rates are published in the Financial
Statistics  report of the Central Bank. The exchange rate
movements of the dinar against the US$ are given in Table
2 of Attachment no. 3.
Reasons why adjustments vary for different products;
elaboration on previous explanations and details on
adjustment factors used for each productThe adjustment is made in the same way for all products.
The slight differences arise from the rounding of figures in
calculations from previous years, and in contrast to 1998,the rate of adjustment in 1999 did not change from oneproduct to another.
Notification of current total AMS without adjustments, asagreed by Tunisia ( G/AG/R/22,  p. 23 refers )Work is still in progress to produce the unadjusted
calculations of AMS for 1999. The relevant informationwill shortly be ready for submission.
New Zealand: Reasons for the variations in the levelsbetween the years, in view of the findings of the WTOdispute panel on Korea – beef; confirmation that "eligibleproduction" receiving market price support is the totalproductionTunisia has previously stated that eligible production
concerned all collected production (" quantités collectées "),
as indicated in its Schedule of Commitments.  Collectedproduction, depending on the year and the product
concerned, does not always correspond exactly to total
production.  In the case of cereals (durum wheat, soft wheatand barley), milk and olive oil, there is a difference arisingfrom the fact that only production considered to be
marketable is collected by the intervention bodies and
eligible to benefit from price support according to a pricescale.  The remainder is not marketed, either because it isconsumed by farming households themselves or because
the product is of insufficient quality and is used on the farm
as fodder.  However, in the case of sugar beet, collectedproduction does correspond to total production.G/AG/R/26
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Table DS:2 Notifications
Canada    G/AG/N/CAN/40    New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
"Canadian Farm Income Programme (CFIP)"
Brazil/Philippines:
Reason for changing the title of the programme from
AIDA (CAN/36 refers) to CFIP; whether this implies analteration of the scope, objectives and target beneficiaries;
evaluation of the activities undertaken under the AIDA
and those envisaged under the CFIP;The change in name did not affect the purpose, nor the
operation or beneficiaries of the programme.  The activitiesunder CFIP are the same as under AIDA.
Products benefiting from such pr ogrammes. This is a whole farm pr ogramme that reflects the gross
margin of all agricultural activities of the farm, not
individual commodities.  All producers in Canada are
eligible to participate rega rdless of what commodities they
produce.
Brazil:  Clarification of budgeted amounts of paymentsunder AIDA and CFIP in apparently overlapping "fiscal"and "taxation" years;AIDA and CFIP operate on the basis of the tax year as
reported by individual claimants.  In most cases, thiscoincides with the calendar year.  Application forms aregenerally filed subsequent to the end of the tax year.
Payments are made in the following fiscal year (e.g. claims
regarding the 1998 tax year were made in the 1999-2000fiscal year which runs from April 1 to March 31.
Japan/Philippines:  Reason for extending AIDA for threeyears;This programme was designed to help address the
continuing financial stress on farm income in Canadawhich is being caused by factors beyond the control ofCanadian producers.
Japan: Whether consideration is given to make this type ofincome safety-net programme a more permanent scheme.Funding has been approved to cover the 2000, 2001 and
2002 tax years.  It is not known at this time whetherfunding will be approved for subsequent years.
Philippines: Method used to calculate amounts of paymentsunder the CFIP.CFIP operates in the same manner as AIDA, as described
in CAN/36.G/AG/R/26
Page 35
Colombia   G/AG/N/COL/23      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
"Development programmes for indigenous communities and reservations, and depressed areas
Australia:  Eligibility criteria; The criteria for legally establishing an indigenous
reservation and receiving the benefits of the notifiedprogramme are closely regulated under Decree 2164 of1995.  An indigenous reservation is clearly defined in this
Decree as a legal and socio-political institution of special
character, composed of one or more indigenouscommunities that own their terr itory collectively with the
guarantees of private ownership, and whose use of that
territory and internal life is governed by an independent
organization having the special status afforded by theindigenous charter and by its own regulatory system.Geographic demarcation and allocation are carried out
directly by the State through the National Institute for
Agrarian Reform (Instituto Colombiano para la ReformaAgraria, INCORA) on request by this Body, the Ministry ofthe Interior or the indigenous community concerned.  For
this purpose, a study of the socio-economic, legal, land
tenure and ethnic aspects will be made, taking into accountthe following elements:  physical description of the areawhere the lands proposed for a reservation are situated,
agro-ecological conditions and current use, ethno-historical
background, demographic description and approximatepopulation figures covered by the programme, socio-cultural description and quantified determination of thecommunity land needs.
Japan:  Conformity with Annex 2 para 13. The Constitution of Colombia under Articles 329 and 330
recognizes the existence of indigenous reservations, whichare to be governed by councils in keeping with the customs
and traditions of the communities whose obligations are,
among others, to ensure the implementation of legalprovisions on land use a nd settlement and to draft
economic and social development policies, plans and
programmes in line with the National Development Plan.
Indigenous communities represent a large proportion of thepopulation and are mostly located in depressed areas,which are difficult to reach and lack infrastructure. Based
on the above, this programme conforms exactly to the
requirements in para 13 of Annex 2, in that it is acontiguous and clearly designated geographic area, with adefinable economic and administrative identity, anddisadvantaged due to more than temporary circumstances.G/AG/R/26
Page 36
Japan   G/AG/N/JPN/62      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
"Rice Farming Income Stabilization Programme (JRIS)"; "Transitional Programme for the New Rice Policies "
New Zealand:  Total notified s upport levels -  Consistency
with data published in OECD 1999 Monitoring and
Evaluation report;The figure cited in the OECD report includes not only the
expenditure under the JRIS (9.6 billion Yen) and that of the
Transitional Programme (40.6 billion Yen), but also thesubsidy granted to the distribution of voluntarily-marketed
rice (41.9 billion Yen).  This latter component has been
notified as a non-exempt direct payment.  Since it fulfilsthe de minimis requirement, it was not included in thecalculation of the Current Total AMS.  The OECD figure
also includes the subsidy which is granted to the
voluntarily-marketed rice distribution corporation (25.7billion Yen). This expenditure is not included in thecalculation of the Current Total AMS since the measure isnot in favour of agricultural producers.
Australia/Canada/New Zealand/United States:  Base level
of production -
Definition under both programmes;The "base level of production" is the three-year average of
the sum of "the actual volume of production" and the
"volume of production estimated by the average yield
multiplied by the set aside area".
Production years entering into the establishment of this
parameter;In computing the base level of production :
• JRIS : the production period 1995-97 has been used as
the subject of payment is the voluntarily-marketed rice
shipped by producers who participated in the production-limiting plan in 1998.
• Transitional Programme: the production period 1994-96
has been used as the subject of payment is the
voluntarily-marketed rice shipped by producers whoparticipated in the production-limiting plan in 1997.
Calculation details for individual producers; The base level of production is not computed for each
individual producer.  However, in order to get qualified forthese programmes, each producer is obliged to participatein the production-limiting programme that limitsproduction to 85 per cent or less of the base level of
production.  In this way, the requirement that " such
payments are made on 85 per cent or less of the base levelof production"  is met.
Australia/Canada/United States: Production-limiting
criteria  –Both programmes are "direct payments under production
limiting programmes".  They are limited to producers whoset aside rice production in order to ensure the effectiveimplementation of the production-limiting plan for rice.
Whether the legislative authority specifically restrictspayments to 85 per cent or less of the base level; relevantprovisions within domestic regulations covering this
requirement; specific criteria used under each of the
programmes;The government draws up the "Basic Plan for Stabilization
of Supply, Demand and Prices of Staple Food" (Basic Plan)every year on the basis of Article 4 of the Staple Food Law.
The Basic Plan thus clearly specifies the annual national
rice production target, which is always below the 85 percent base level of production. The target production-limiting area is then determined for each producer on the
basis of this national production figure, taking into account
various factors, such as the productivity of each differentregion. The Basic Plan is published on the Web Site of theFood Agency.G/AG/R/26
Page 37
Japan   G/AG/N/JPN/62      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
Australia: Transitional Programme - Confirmation that this
was a one-year programme and hence that it terminated in
1999;Confirmed.  The programme terminated by the end of FY
1998.
Canada/New Zealand:  JRIS –
JRIS Fund: Determination of the shares of producers' and
government's respective contributions; fixed ratio which
is applied to the "compensation standard price " (CSP) in
order to determine the amount of government assistance;The level of contributions, by producers as well as by
government, is determined on the basis of a certainpercentage of CSP which is equal to the average price ofvoluntarily-marketed rice in the preceding three years.
Producers contribute an amount equal to 2 per cent of the
CSP multiplied by the volume subject to the JRIS.  Thegovernment contributes an amount equal to 6 per cent ofthe CSP multiplied by the volume subject to the JRIS.  The
share of producers' contributions in the total Fund is
therefore around 25 per cent whereas that of thegovernment is around 75 per cent.
Conditions and amount of payments: clarification of " a
certain per cent of the price gap"When the average price of voluntarily-marketed rice that is
produced in the current year falls short of the CSP, 80 percent of the price gap multiplied by the volume ofvoluntarily-marketed rice shipped by the producer is paid.
United States: Reporting of rice diversion payments in
Japan's notifications.These payments have been, and continue to be, aggregated
in the Green box category of support under item (j)"environmental programmes" in Japan's notifications.
"Support Programme for the Reduction of Environmental Burden Due to Dairy Farming"
United States:  Eligibility conditions; Subsidies are paid to dairy farmers who manage livestock
soil in conformity with the management criteria establishedin the Law Concerning the Appropriate Treatment andPromotion of Utilization of Livestock Manure. The
programme is designed to ensure the proper management of
livestock soil and the maintenance of a desirableenvironment.  Livestock farmers must comply with specificmanagement criteria which include : structural standards
(construction of floors using waterproof material, etc.);
regular inspection and repairing of facilities; recording theamount of annual generation of livestock soil and theamount of disposal by method used.G/AG/R/26
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Japan   G/AG/N/JPN/62      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
"Direct Payment to Farmers in the Hilly and Mountainous Areas"
United States:  Eligibility conditions; In accordance with the local community agreements,
subsidies are paid to the farmers who (a) have beenengaged in farming for more than five consecutive yearswithin disadvantaged regions, designated as such by law
(e.g. mountainous villages, depopulated areas, solitary
islands), and (b) conduct farming in groups of agriculturalfields whose area is above 1 ha and face productiondisadvantages that are clearly defined on the basis of
objective criteria such as gradient.  Local community
agreements are contracts between farmers which must beapproved by the municipal governments.  The agreementsshould include the scope of the targeted agricultural fields,
and the measures to be taken in order to maintain and
manage the farms, the canals and the farm roads.
Follow-up discussion:  In light of the discussions which are reflected in paragraphs 2-13 of the present report , Argentina
sought details on support l evels decided during the marketing year 1992 for rice.  Japan stated that the delegation would
first carefully watch the developments of the discussion during the informal consultations which are due to be conducted
by the Vice-Chairman.  In this respect, Japan requested that its delegation be joined in this informal process.
Mexico   G/AG/N/MEX/6      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
"Alliance for Agriculture"
United States: Operation details on each of the notified
components; basis on which direct payments are made :
Structural adjustment assistance provided through
investment aids -  Consistency with Annex 2 para 11;
Regional assistance – Definition of a disadvantaged
region; consistency with Annex 2 para 13.The Delegation of Mexico undertook to provide a response
at a later stage.G/AG/R/26
Page 39
Tables ES:1 to ES:3 Notifications
Colombia   G/AG/N/COL/19/Corr.2    Export Subsidies (Table ES:1 and ES:2)
Points raised by other Member s Response by Notifying Member
Australia: Clarification as to why outlays under the Tax
Reimbursement Certificate (CERT) are not considered to
constitute export subsidies under the Agreement onAgriculture;
Canada/New Zealand:  bakers' wares with cocoa ; fruit;
molasses; sugar and sugar confectionery not containing
cocoa; vegetable oils  - Circumstances in 1998 that led to
export subsidies being provided in excess of quantity
reduction commitments; present status of these subsidy
programmes;
New Zealand : Sulphonated, nitrated or nitrosated
derivatives of hydrocarbons;  ginger; jams; fruit jellies
and marmalades – Subsidized exports in excess of total
exports.Colombia considered that these questions were identical to
those posed during the March 2000 meeting of the
Committee on Agriculture and therefore reiterated the samereplies.  These are reflected in G/AG/R/22 pp. 27-28.
Additional comments:  Argentina  reiterated its concerns about Colombia's la ck of implementation of export subsidy outlay
and volume commitments, as well as the subsidization by Colombia of exports of non-scheduled agricultural products.
Argentina urged Colombia to bring its export subsidy programmes in compliance with its obligations under theAgreement on Agriculture. Colombia stat ed that CERT was not a subsidy programme.  Consequently, Colombia assumed
no obligations in this respect.  New Zealand underscored the importance it attached to the full compliance by Members of
their respective export subsidy commitments in agriculture.  In this respect, New Zealand did not get the sense that
Colombia had actually responded to the questions it had posed.
Costa Rica   G/AG/N/CRI/4/Add.1 and CRI/13   Export Subsidies    (Tables ES:1 to ES:3)
Points raised by other Member s Response by Notifying Member
New Zealand: The purpose of this addendum was to update the
cumulative amount of export subsidies granted during 1997under the CAT.
Since the Tax Credit Certificate (CAT) is a percentage ofthe value of exports, details are sought on the percentagevalues used in calculating support over the years since1995;CAT subsidies amounted to (million US$): 94 in 1995; 15
in 1996; 105 during the first half of 1997; 122 in 1998 and20 in 1999. Additional technical details on the functioning
of the CAT are given in document G/TRIMS/N/1/CRI/1, a
notification by Costa Rica under the TRIMS Agreement, assubscribers had to achieve a certain percentage of localcontent in exported products as an essential condition forreceiving the CAT.
Confirmation that this export subsidy programme waseliminated on 30 September 1999.Confirmed. Costa Rica ceased to apply this measure of
export assistance. As of 30 September 1999, no furtherCAT certificates were granted.
Israel   G/AG/N/ISR/20    Export Subsidies    (Tables ES:1 and ES:2)
Points raised by other Member s Response by Notifying Member
Australia: Fruit (not citrus)  – Reasons for the rise in fruit
exports from the previous year (ISR/13).The rise noted in 1999/2000 is only apparent as it in fact
represents a return to normal production levels. In the
1998/1999 year, total non-fruit exports had been below
average due to a lower avocado production.  Production ofavocados was restored to normal levels in 1999/2000,which had an impact on total exported volumes on non-citrus fruit.G/AG/R/26
Page 40
Korea   G/AG/N/KOR/29    Export Su bsidies    (Tables ES:1 and ES:3)
Points raised by other Members Response by Notifying Member
New Zealand: Kimch'i; vegetables; livestock products ;
Expressed disappointment at Korea's further use ofdeveloping country provisions with respect to exportsubsidies as New Zealand believed that these measures are
not commensurate with Korea's economic development
needs.A relatively small amount of financial resources are
allocated to a selected number of products.  The quantitiesreceiving export subsidies are very minimal, and in mostcases, are less than 1 per cent of the total volume of
production.  These subsidies are granted in accordance with
Article 9.4.
Details of specific cost reduction measures These refer to reduction of packaging costs in the case of
livestock products; and sorting, packaging and
transportation costs in the case of Kimch'i and vegetables.
List of specific vegetables and livestock products Vegetables:  tomato and cherry tomato, paprika, cabbage
and Chinese cabbage, cucumber, egg-plant, strawberry.
Livestock products: pigmeat, poultry meat, live swine for
pure-bred breeding.
Norway   G/AG/N/NOR/28    Export Subsidies    (Tables ES:1 to ES:3)
Points raised by other Member s Response by Notifying Member
New Zealand/Philippines:
New Zealand expressed disappointment at Norway's
decision to roll-over unused export subsidies for fiveproducts in 1999.  While New Zealand is aware of theprovisions of Article 9.2(b), it does not believe that
Norway's use of it to justify exceeding outlay commitments
by more than 460 per cent, as was the case for bovine meat,is in conformity with the spirit of the Agreement onAgriculture.
Reason why export subsidy levels for bovine meat, swine
meat and butter  were so high in 1999 when compared
with previous years; rationale for the continued practiceto roll-over unused export subsidies;Norway has made use of the provisions of Article 9.2(b)
and has thus acted in conformity with the Agreement onAgriculture. Export subsidies are paid to exporters
according to applications, within the limits of Norway's
commitments.
New Zealand: Given that Norway will be unable to provide
excessive export subsidies for many products in the yearsto come, outline of the market measures that will beintroduced.Export subsidies for 2000 will not be paid beyond the 2000
levels of commitments.  Various measures have been takento bring domestic production in balance with domestic
consumption.  Reference is made to Norway's Table DS:2
notification regarding the scheme for resource retirement inthe milk sector.G/AG/R/26
Page 41
Romania   G/AG/N/ROM/16/Corr.1   Export Subsidies    (Tables ES:1 and ES:2)
Points raised by other Member s Response by Notifying Member
Australia/Canada/New Zealand:  Cereals, bovine meat,
pigmeat, sheep meat, tinned meat products and poultry
meat  -  Explanation for the apparent breach of outlay
commitments in 1998 and 1999;In the footnote attached to ST/DS:11 of AGST/Romania,
its is specified that the outlay commitments are in " constant
Lei 1986-1989 and current prices 1986-1989" . The annual
commitment levels were calculated at current prices 1986-
1989 at a foreign exchange rate of 23 Lei per US$.  In
1998, the exchange rate was 8,875.5 Lei per US$. Usingthe 1986-1989 exchange rate,  the annual commitment levelof 611 million Lei represents 26,583 thousand US$.  The
22.4 billion Lei represents only 2,525 thousand US$, using
the 1998 exchange rate. Therefore, Romania's exportsubsidy commitments were not breached.
New Zealand: Expressed concern at Romania's notificationof export subsidy outlays in excess of its commitmentlevels and pointed out that the Agreement did not providefor adjustment for inflation for export subsidies -  Steps
Romania intends to take to bring itself back into
conformity;
Canada:
Present status of export subsidy programmes; Romania, a transition economy, is going through a complex
process of transformation into a market economy. Theexport subsidies mentioned in the questions are given in thecontext of a national support programme for agriculture.
System in place to ensure that exports above thosenotified as subsidized do not receive any export subsidies;The government allocates the amounts n ecessary to the
achievement of the objectives of the above-mentionedsupport programme and issues decisions applicable to eachproduct.  The subsidies allocated by the State Budget are
then transferred to the Ministry of Food, Agriculture and
Forests, the authority responsible for ensuring that therespective amounts r each the agricultural producers.
Through this mechanism, the Romanian authorities ensure
that the amounts specified by government decisions are
utilized in accordance with their intended destinations.
Tunisia   G/AG/N/TUN/21    Export Subsidies    (Tables ES:1 and ES:3)
Points raised by other Member s Response by Notifying Member
Canada: Wine  – Demonstration that export subsidies were
indeed applied under the provisions of Article 9.4.The information indicated in column 2 of ST/ES:2 refers to
processing costs in the case of wine.  These subsidies are
not recent, they have been notified over the past few yearsand are included in Tunisia's Schedule.G/AG/R/26
Page 42
Table ER:1 Notifications
Hungary   G/AG/N/HUN/24 and Add.1   Export Prohibitions and Restrictions    (Table ER:1)
Points raised by other Member s Response by Notifying Member
Temporary ban on the export of maize fodder
Australia: Noted that Hungary made itself available for
consultation, consistently with  Article 12(b) -  Reason why
a notification was only provided after implementation ofthe ban;The delay in submitting the information was due to the
urgency to prevent a critical shortage of an essentialproduct.
Japan:
Background behind the decision to introduce the ban;
relevant data on domestic production, consumption,
imports, exports, and market prices over recent years;During the previous year, Hungary was hit by severe
flooding and subsequently by drought. This caused a
significant decrease in maize production. The firstestimates suggested that there was an imminent threat thatdomestic production could hardly cover the domesticneeds.  In addition, an increased demand for maize fodder
was expected from neighbouring countries which had been
equally hit by the same natural disaster. Against thisbackground, the government introduced a temporary exportban to forestall the disruption of the domestic feed market.
As soon as it b ecame clear that the supply situation was
better than was first estimated, Hungary immediatelyproceeded to lifting the export prohibition.
Domestic procedures in place to introduce or lift an
export prohibition or restriction; role of each government
body involved in that process; conditions to be met.In situations of critical shortages of foodstuffs or other
essential products, or threats thereof, the Minister of
Agriculture and Rural Development, upon governmentdecision, has the right to introduce such measures, or liftthem when the critical situation is over.
G/AG/R/26
Page 43
ANNEX – Part II
Deferred Replies to Questions on Notifi cations Raised at Previous Meetings
Table MA:2 Notifications
Norway    G/AG/N/NOR/27   Tariff Quota Fill    (Table MA:2)
Point raised by Kenya (G/AG/R/25, page 16, refers)  : Imports under Norway's GSP scheme
Since its establishment in 1971 the Norwegian GSP-scheme has been enlarged a number of times.
Changes have been made both in the list of products entitled to preferential tariff treatment, the list ofbeneficiary countries and the rules of origin. The objective of the revisions has been to make theNorwegian market more accessible for exports from de veloping countries and especially from the least
developed countries (LDCs). Document WT/COM TD/N/6/Add.2 shows the consolidated revised
version of the Norwegian GSP-scheme and gives an overview of the countries covered by the scheme;the different products entitled to preferential tariff treatment and the provisions on rules of origin.
In 1998, Norway implemented a revised regulation on rules of origin, harmonised with the rules applied
by the European Community and Switzerland. This amendment also opened for bilateral cumulation oforigin in GSP-countries with products originating in Norway.  The regulation provided for futurediagonal cumulation of origin with products originating in the European Community and Switzerlandon a reciprocal basis. An agreement to this end will be implemented as of 1 April 2001.
Since 1995 all GSP-imports of products originating in LDCs are eligible for duty- and quota-free
access, except for flour, grain and feeding stuffs.  The latter qualify for a 30 per cent cut in duties up to
certain quantitative ceilings.  In the year 2001 the special safeguard mechanism within the GSP-scheme
will be invoked if imports of duty-free beef from countries granted LDCs-status exceed 2,700 tons.
1
Under the GSP-scheme, imports of manufacturers from beneficiary developing countries enjoy duty-free access with the exception of certain textile, clothing and footwear products.  All agriculturalproducts except milk and dairy products, live animal s and certain processed agricultural products are
included in the scheme.  The reductions granted for these products to beneficiary developing countries
range from 10 per cent (on sensitive agricultural products such as meat) to 100 per cent (on most fruitsand vegetables). Imports of sugar for human consumption, coffee, tea and certain other tropicalproducts are duty free from all countries. Imports of agricultural products have to satisfy veterinary andphytosanitary regulations.
Total imports
 2 (all HS numbers) from developing coun tries amounted to NOK27.910 million in 1999.
The corresponding number for imports from LDCs was NOK1.465 million.  Total Norwegian imports(all HS numbers) granted GSP-treatment amounted to NOK4,829 million in 1999. The corresponding
number for imports from LDCs was NOK255 million. Total Norwegian imports of agricultural products
from developing countries amounted to NOK3,676 million in 1999.  The corresponding number for
LDCs was NOK188 million. Total Norwegian imports of agricultural products granted GSP-treatmentamounted to NOK694 million in 1999.  The corresponding number for imports from LDCs was
NOK128 million.
1  With effect from 1 January 2002, all GSP imports of products originating in LDCs are eligible for duty- and quota-free access,
except for flour, grain and feeding stuffs where duty-  and quota-free access will enter into effect from 1 July 2002 .
2   Source - statistical data: Ministry of Finance, NorwayG/AG/R/26
Page 44
Norway    G/AG/N/NOR/27   Tariff Quota Fill    (Table MA:2)
Point raised by Australia (G/AG/R/25, page16, refers)  : Auction fees collected during the last two years
Auctions are held in October the year before the im ports are to take place.  The auction fees paid for
imports of meat of bovine animals, frozen , in calendar years 1998 and 1999 were respectively:
• 1998: NOK2,747,875 corresponding to an average fee per kilo of NOK3.77
• 1999: NOK5,357,400 corresponding to an average fee per kilo of NOK5.93G/AG/R/26
Page 45
Table DS:1 Notifications
Costa Rica   G/AG/N/CRI/7      Dome stic Support (Table DS:1)        G/AG/R/25, page 19 refers
Points raised by Canada, Japan and New Zealand Response by Costa Rica
Green Box
Canada:  "Crop insurance service" –
Breakdown of expenditures on insurance compensation
between (a) government contributions and (b) producer
premiums;The insurance costs, or premium, are paid by the farm
operator and correspond to a percentage of the amount
insured.  This varies between 2.5 per cent and 9.5 per cent,depending on the crop, type of coverage, area, sowingmethod and surf ace area.  The State makes no contribution
to farm operators, who must pay the total amount of the
premium. Compensation is generally equal to the insuredamount, minus the amount of any crop sales that have beenmade.  In cases of losses caused by pests or diseases, areduction of 5 per cent is applied.
Specific policy criteria under which exemption isclaimed; conformity with such criteria.It is classified in para 8 of Annex 2:  Payments (made either
directly or by way of government financial participation incrop insurance schemes) for relief from natural disasters.
AMS
Japan/New Zealand: "Conversion of production" -
Description of programmeThis is a government project with legal basis (in Law No.
7742 of 15 January 1998) to improve the competitivenessof domestic agricultural producers by taking such steps as:
fostering producers' organizations; fostering improved
industrial processing of agricultural commodities; (c)carrying out soil conservation work; promoting the use ofquality guidelines for agricultural products; research,
training and technology transfer to farm operators;
promoting conservation, agricultural and agro-industrialprogrammes.  These steps are not by law aimed specificallyat any one product.
The programme directs public funds towards activities
which include: technical advice, training for farmers,
development of infrastructure and marketing information.There is also provision for the possible allocation offinancial resources to organized production sectors for
specific projects designed to improve production
conditions.  These projects must first be confirmed asviable in view of international and domestic marketconditions, and are aimed especially at small organized
producers.  Most of the resources allocated to each project
are normally repayable on soft terms and only a smallpercentage is non-repayable .
The programme is in line with Costa Rica's rights and
obligations, its UR agricultura l offer and the provisions of
the Agreement on Agriculture.G/AG/R/26
Page 46
Malaysia   G/AG/N/MYS/13      Do mestic Support (Table DS:1)      G/AG/R/25, page 21 refers
Points raised by other Member s Response by Notifying Member
Green Box
Australia:  "Drainage and irrigation facilities" -  Whether
on-farm facilities are provided under this programme.On-farm facilities are not provided.  Only generally-
available public utilities are provided.
Australia/Canada/Japan/New Zealand:   "Price subsidy and
guaranteed minimum price" -Please refer to the background information concerning thesituation of paddy farmers in Malaysia in relation with thequestions posed by the United States (see the previous
section of this Annex). In ad dition, Malaysia dos not export
rice but rather imports some 40-45 per cent of its riceconsumption requirements.
Description and operation details to support currentclassification in the Green Box and show compliance withspecific exemption criteria;These subsidies constitute income-support tools provided to
paddy farmers who are the poorest among the farmingcommunity in Malaysia.  These subsidies are not seasonallyor annually adjusted to reflect world prices.  The price
coupon subsidy was last adjusted in 1990. The guaranteed
minimum price was last adjusted in 1997 to narrow thewide disparity in the level of income with other smallholders (rubber and palm oil small holders, who do notreceive any such support from the government but enjoythe benefits of relatively higher commodity prices).
Explanation of how Annex 2 para 6(b) criteria is met
since support is only granted to paddy  farmers;Malaysia only provides income-support to the most needy
group of the population. In this instance, the group thatqualifies for receiving such support happen to be paddyfarmers.
Programme delivery is through a guaranteed minimumprice and as such does not appear to meet Annex 2
exemption criteria.  Indication of whether the amount of
support would be de minimis  if this measure were
included in the AMS;This programme would be de minimis  if it were to be
included in the AMS.
Malaysia is encouraged to consider policy options that aredesigned in response to the plight of poor farmers.  Thesecould fit within the scope of Annex 2 or Article 6.2, bothof which provide ample scope for these importantdevelopment objectives.Malaysia thanked New Zealand for its understanding and
took note of its proposal.
G/AG/R/26
Page 47
South Africa   G/AG/N/ZAF/29   Domestic Support (Table DS:1)       G/AG/R/24, page 20, refers
Points raised by Australia Re sponse by Notifying Member
Green Box
Australia: "Regional assistance"  -  Basis for designating a
region as being disadvantaged; basis for calculating
payments.The figure for regional assistance programmes represents
expenditures in the nine provinces.  South Africa is in anongoing process of consultations with provincialgovernments to refine the allocation of the amounts utilized
for domestic support to appropriate and more accurate
categories given the prescribed criteria. It appears thatsome of the expenditures can possibly be placed in morethan one category, e.g. under either paragraphs 11 or 13 of
Annex 2.  The allocation made in ZAF/29 seems to be the
most appropriate at this point, but consultations continue.The refinement of  the present allocation will be reported tothe Committee in future, including a Table DS:2
notification where appropriate.  South Africa is willing to
pursue further clarification of these programmes withAustralia if required.G/AG/R/26
Page 48
Attachment no. 1
G/AG/N/NOR/ 27 – Monthly average internal prices for selected tariff quota products, 1999
Milk and cream (wholesale prices):
Whole milk Cream SMP Whole Milk Powder
First six months 1999: NOK 7.20 NOK 28.54 24.10 24.16
Second six months 1999: NOK 7.27 NOK 29.24 24.20 24.26
Potato seeds: NOK 3.85 per kg. 01.01.99-30.04.99
NOK 4.05 per kg. 01.05 99-31.12.99
(Fixed sales price by the major seed supplier to potato producers in the
two periods indicated.)
Fresh blackcurrants: NOK 6.80 per kg.  Average producer price 1999 season.
Monthly prices are not set for this seasonal product.
Frozen strawberries: NOK 19.75 per kg.  Average producer price.
Monthly prices are not set for this seasonal product.
This price relates to frozen products not containing sugar.  Frozen
strawberries containing suga r are not produced domestically.
Barley (producer price including storage):
NOK per kg.
January 1.99
February 2.01
March 2.04April 2.04
May 2.04
June 2.04
July 1.92
August 1.92September 1.92
October 1.93
November 1.95
December 1.98
With regard to the products:  nuts, provisionally pres erved;  maize seed;  bran sharps and other residues
of maize there is no domestic production and domestic pr ices are thus not available.  With regard to
frozen potatoes and fruits provisionally preserve d there is virtually no domestic production and no
domestic price registration is available.G/AG/R/26
Page 49
Attachment no. 2
G/AG/N/BRA/18  - Ju stification of de minimis  claims, 1998
Product-specific
Production value
Product descriptionTotal product-
specific AMS
US$'000R$'000 US$'0001AMS/Production
value
%
Barley
Brazil wax
Cashew nutsCassavaCastor-oil plantCoffee
Cotton
Edible beansGarlicGrape (and by-products)JuteMaize
Oats
PeanutsRamieRiceRyeSisal
Sorghum
SoybeansSugar caneWheat2,439.3
162.2
1,518.82,810.2
332.7
33,534.5
55,424.1
6,699.0
492.0
3,113.9
0.0
47,884.7
271.4
1,016.7
0.0
26,409.4
0.0
15.1
300.2
87,335.589,148.927,395.846,099
14,760 (*)
25,920
2,181,680
4,550
4,016,036
560,395
1,961,421
104,922499,980
    -
3,875,030
33,804
70,245
1,065
2,247,187
1,198
32,364
49,845
6,494,9986,060,685
315,95139,751
12,728
22,351
1,881,245
3,923
3,462,996
483,224
1,691,318
90,473
431,129
    -
3,341,407
29,149
60,572
918
1,937,731
1,033
27,907
42,981
5,600,5855,226,080
272,4426.14
1.27
6.800.158.480.97
11.47
0.400.540.72
    -
1.43
0.93
1.680.001.360.000.05
0.70
1.561.71
10.06
(*)  Estimated
Non-product-specific
Production value
Product descriptionTotal non-product-
specific AMS
US$'000 R$'000 US$'0001AMS/Production
value
%
Total of agriculturalproduction value105,229.2 67,891,999 58,542,726 0.18
1Exchange rate applied (annual average): 1. 1597R$/US$
Source: Data of National Accounts from IBGE for 1998.G/AG/R/26
Page 50
Attachment no. 2
(Cont'd)
Exchange rate (R$ / US$), 1997-1999
Month (*) 1997 1998 1999
January 1.0420 1.1191 1.5011
February 1.0485 1.1263 1.9129
March 1.0559 1.1329 1.8960
April 1.0601 1.1404 1.6933
May 1.0690 1.1473 1.6827
June 1.0738 1.1538 1.7646
July 1.0799 1.1607 1.7995
August 1.0871 1.1709 1.8800
September 1.0928 1.1801 1.8973
October 1.0993 1.1876 1.9687
November 1.1065 1.1929 1.9291
December 1.1128 1.2046 1.8420
Average 1.0773 1.1597 1.8139
Source: Banco Central do Brasil
(*) Daily averageG/AG/R/26
Page 51
Attachment no. 3
G/AG/N/T UN/18 -  Rates of inflation and ex change rate fluctuations, 1988-1999
Table 1 – Rates of inflation, 1988-1999
Year 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Rate 7.2 7.7 6.5 7.8 5.5 4.0 4.7 6.3 3.7 3.7 3.1 2.7
Source:  Central Bank of Tunisia.
Table 2 – Exchange rate movements of the Tunisian dinar against the US dollar, 1988-1999
Year 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Rate 0.8543 0.9946 0.8602 0.9459 0.8844 1.0057 1 .0133 0.9458 0.9747 1.1029 1.1374 1.1884
Source:  Financial Statistics , Central Bank of Tunisia.
__________