. /.RESTRICTEDWORLD TRADE
ORGANIZATIONG/SCM/W/477
15 January 2002
(02-0177)
Committee on Subsidies
and Countervailing MeasuresOriginal:  English
IMPLEMENTATION-RELATED ISSUES REFERRED
TO THE COMMITTEE BY MINISTERS
Questions from Canada to Brazil1 and India2
The following communication was received on 14 January 2002 from the Permanent Mission
of Canada.
_______________
Article 14 – (Topic 1 from Annex I to th e Chairman’s paper circulated by fax on
17 December 2001)
Issue3 1 – In principle, we favour greater transparency/predictability in the application of the
Agreement.  Is Brazil seeking further elaboration of paragraphs (a) to (d) of Article 14 or does Brazilperceive deficiencies in coverage beyond current Artic le 14.  If so, what would those deficiencies be?
Issue 2 – Is Brazil’s intent 
simply to codify existing WTO case law (Canada-Regional Aircraft)
which has held that Article 1.1(b) of the ASCM does not admit of a “cost to government” approach
to determining benefit?
Issue 3 – Is India suggesting that, where the specif ied financial contribution (i.e., the forgoing or non-
collection of duties) occurs after the period of investigation, there is no benefit notwithstanding that
the eligibility requirements were satisfied and legal entitlement to the financial contribution vestedduring the investigation period?  Is a benefit in terms of the marketplace not conferred at the time
legal entitlement to a financial contribution vests in the recipient (insofar as the financial contribution
becomes a receivable of the enterprise concerned, which can be factored into its product pricing
equation)?
Issue 4 – What does India perceive to be the deficiencies in current footnote 1 and items (h) and (i) of
Annex 1?  Given that the remission or drawback of  duties otherwise owing are, by their very nature,
financial contributions, is it not incumbent on granting Members to ensure that their programmes are
administered in a manner that allows for verification of the amounts by which exemptions or
remissions exceed duties which have accrued?
                                                     
1 G/SCM/W/464.
2 G/SCM/W/462.
3 “Issue” refers to those outlined in the aforementioned Annex I which in turn were taken from the
Brazil and India submissions – G/SCM/W/464 and G/SCM/W/462 respectively.G/SCM/W/477
Page 2
Issue 5 –
(a) Does this refer to administrative costs, (e.g., application costs).  If not, what other
expenses are envisaged?
(b) Consistent with current practice in many countries.
(c) What would Brazil’s preference be, e.g., company rates, country tax rates, etc.?
Depreciation expense is referred to Article 2.2.1.1 of the Anti-dumping Agreement.
Is Brazil looking for a parallelism i.e., depreciation that would be “in accordance with
GAAP standards of the exporting country a nd reasonably reflect the costs associated
with the production and sale of the product under consideration.”
Issue 6 – See comments re. 5(c) above.
Issue 7 – As a quid pro quo  for sampling, does Brazil envisage a requirement for expedited reviews,
where justified, to confer individual company rates?
Issue 8 – No comment.
De minimis  –(Topic 3 from Annex I to the Chairman’s paper circulated by fax on
17 December 2001)
Issue 1 – While the relevancy of de minimis  is clear in investigations, its application in the
enforcement stage is less so.  In particular, where the amount of subsidy was not found to be de
minimis  in the original investigation and resulting injury to the domestic industry was established, the
levying of countervailing duties on all subject imports, (including particular shipments benefiting
from de minimis  amounts of subsidy), may be justified both for valid policy and administrative
reasons.
__________