JOB/AG/160  
 
11 July 2019  
(19-4622) Page: 1/6 
Committee on Agriculture  
Special Session  Original: English  
 
DOMESTIC SUPPORT OPTI ONS 
CIRCULATED  ON BEHALF OF THE FOLLOWING CAIRNS GROUP  MEMBERS:  
ARGENTINA, AUSTRALIA , BRAZIL, CANADA, CH ILE, COSTA RICA,  
PERU, NEW ZEALAND, THAILAND AND URUGUAY  
The following submission, dated 9 July 2019, is being circulated at the request of the aforementioned  
Members . 
 
_______________  
 
 
1  OVERVIEW  
1.1.  In discussions held since MC11 under the auspices of the Committee on Agriculture in Special 
Session (CoA -SS), Member s have identified addressing issues surrounding the usage of production 
or trade -distorting domestic support as an important topic for WTO negotiations on agricultural 
reform. This paper reviews the different themes identified and discussed by Members on d omestic 
support and consolidates the various reform options for consideration in this pillar.  
1.2.  The paper covers all elements of domestic support as they are categori zed in the Agreement 
on Agriculture, from Articles 6.3 Final Bound Total AMS (FBTAMS) and 6.4 de minimis  (e.g. the 
Amber Box), to exempted forms of support, including Article 6.2, Article 6.5 (i.e. the Blue Box) and 
Annex  2 of the Agreement on Agriculture (i.e the Green Box). We also consider options raised with 
respect to Special and Differentia l Treatment  and an overall trade -distorting support  limit (e.g. 
OTDS). The options presented are drawn from those brought forward by Members, from all different 
groupings and across a range of perspectives.  
1.3.  The options outlined in the paper are not propos als, nor should they be interpreted to 
preference or prioriti ze any one particular option. Rather this paper should be viewed as a non -
exhaustive list of options to be further discussed.   
1.4.  In order to facilitate discussion, this paper organises the various  options on reforming domestic 
support into three themes: (1) developing new disciplines through limits and reductions in domestic 
support, (2) by clarifying existing rules on domestic support, and (3) enhancing transparency. This 
is intended to facilitate  discussions towards pragmatic ways forward in negotiations on domestic 
support.   
2  THE AMBER BOX – PROD UCT AND NON -PRODUCT -SPECIFIC SUP PORT  
2.1.  The Amber Box covers non -exempt production and trade -distorting support  in Articles 6.3 and 
6.4 of the Agreement on Agriculture, which is limited according to a Member 's Final Bound Total 
AMS (FBTAMS) in their Schedule of Commitments. Besides, a ll Members have access to a de minimis  
level of production or trade -distorting sup port which is tied to a proportional value of agricultural 
production. This support can be provided on a product specific or non -product -specific basis.  
2.1  Product -specific support  
Issues  
2.2.  Product -specific support  is regularly cited by Members as the most dist orting form of support 
in agricultural trade, as production or trade -distorting support is often concentrated on only a few JOB/AG/160  
 
- 2 - 
 
  specific commodities. When applied in large sums, product -specific support  can have a detrimental 
impact on both domestic and global  markets. Currently, the limits on Amber Box support by product 
are the existing product specific de minimis  limits, and scheduled FBTAMS.  
Options  
2.3.  Members have considered options to address product -specific support  including: limiting and 
reducing total product -specific support ; reducing or limiting AMS support beyond de minimis  on its 
own; setting new de minimis  limits; or limiting and reducing through inclusion in an overall limit. 
Members have also suggested providing additional clarifications of the rul es for calculating product -
specific support , and improving transparency in the notification of product -specific support . 
2.2  Non-product -specific support   
Issues  
2.4.  Non-product -specific support  can also distort trade and production, if it affects production 
decisions or reduces risk in Member 's agricultural sector. Non -product -specific subsidies can enhance 
the competitiveness of agriculture sectors in domestic or international markets.  
2.5.  Another aspect that needs consideration is the reporting of non -product -specific support . 
Members have raised concerns that de facto product -specific support may be being notified as non -
product -specific support , taking advantage of rules in Article 6.4 to more easily claim this support 
as de minimis , as the calculation of support is made on the basis of the total value of agricultural 
production.  
Options  
2.6.  Members have considered options to address non -product -specific support  including: additional 
transparency; reducing Final Bound Total AMS, and/or de minimis  levels; and/or including FBTAMS 
and non -product specific de minimis  in an overall limit (OTDS). Moreover, in order to improve 
reporting, Members could discuss criteria t o determine what is truly non -product specific.  
2.7.  The options for the Amber Box are summarized below in Table  1. 
Table  1: Amber Box – Product -specific and non -product -specific options  to strengthen 
rules and disciplines  
Article 
in AoA  Reform through limits  Clarification of rules Additional transparency  
6.3 
(FBTAMS 
and 
CTAMS)  - Reduce FBTAMS  
- Introduce product  specific 
disciplines (e.g. anti -concentration 
clause, product specific disciplines 
based on export s/import s) 
- Introduce standstill on product -
specific support  
- Include in an overall limit (OTDS)  
- Other  - Clarification of calculation 
methodologies (e.g. market 
price support (MPS))  
- Clarification of non -product - 
specific definition  
- Other  - Add total Value of Production 
(VoP) and product specific VoP 
to notification templates  
- Include additional information on 
the calculation of market price 
support   
- inclusion of harmonized product 
descriptions for product -specific 
support  (e.g. tariff codes)  
- Other  
6.4  
(de 
minimis ) - Reduce de minimis percentage  
- Different de minimis  levels 
between product specific and non-
product -specific support   
- Introduce standstill on product -
specific support  
- Include in an overall limit (OTDS)  
- Other  - Clarification of cal culation 
methodologies (e.g. market 
price support (MPS))  
- Clarification of non -product 
support  
- Other  - Add total Value of Production 
(VoP) and product specific VoP to 
notification templates  
- Include addition al information on 
the calculation of market p rice 
support in notification templates  
- inclusion of harmonized product 
descriptions for product -specific 
support  (e.g. tariff codes)  
- Other  
3  EXEMPTED SUPPORT  UNDER ARTICLE S 6.2 AND 6.5  
3.1.  While both Article 6.2 ( developing country Member exemptions) and Article 6.5 (Blue Box) are 
considered trade - and production -distorting and therefore included under Article 6 of the Agreement 
on Agriculture, Members agreed in the Uruguay Round to exempt these forms of support from a 
Member 's reduction co mmitments. While the amount of support provided under these Articles was 
initially low for these exempted types of support, utili zation has increased over time.  JOB/AG/160  
 
- 3 - 
 
  3.1  Article 6.2  
Issues  
3.2.  Article 6.2 was established to allow developing country Members to provide s ome forms of 
product specific and non -product -specific support , without any reduction commitment, to enable 
them to pursue legitimate development goals. When applied in excess or without proper 
qualification, those subsidies may also be a source of distort ions to trade and production of 
agricultural goods. These concerns are particularly acute in the case of input subsidies, whereas 
support for diversification from growing illicit narcotic crops has been less controversial.  
Options   
3.3.  Members have discussed o ptions including: placing limits on the amount of support that could 
be provided under Article 6.2, on the basis either of VoP or a fixed monetary value; the inclusion of 
Article 6.2 support into an overall limit; or further clarifying the meaning and exte nt of terms such 
as "low-income or resource -poor producers ". Enhanced transparency where Members provide more 
information on how they implement their Article 6.2 programs could also be considered; including 
by outlining the eligibility criteria and a detai led breakdown of expenditure.  
Table 2: Article 6.2 – Options to strengthen rules and disciplines  
Article in 
AoA Reform through limits  Clarification of rules Additional transparency  
6.2 - Introduce a limit for 6.2  based 
on: 
 - Historical spending  
 - VoP 
 - Other 
- Include all 6.2 or just parts (e.g. 
exclude illicit crops)  
- Include part or all of 6.2 in an 
overall limit (an OTDS)  - Clarification of "generally 
available "? 
- Clarification of "low-income or 
resource poor producers "? 
- Clarify that support should go 
directly to producers and not 
suppliers of inputs (e.g. electrical 
utilities, or fertilizer suppliers)?  
- Other  - More complete programme 
descriptions  
- More complete breakdowns of 
expenditure – i.e program by 
program  
- Information to show how 
criteria are met?  
- Other  
 
3.2  Article 6.5 – Blue Box  
Issues  
3.4.  The Blue Box can be used to achieve policy objectives such as providing a transition to Green 
Box support and to limit surplus production. Despite these objectives, concerns have been raised 
regarding the ambiguity of and potential to circumvent the FBTAMS  commitments through the 
existing "production limiting " criteria in the Blue Box. These concerns include that : Blue Box 
payments can increase production of certain products;  base periods can be revised and updated ; 
and payments per unit could increase unde r the existing rules. Another concern raised by Members 
was that Blue Box programs can operate alongside Amber Box programs, thus undermining claims 
that such programs are production limiting.  
Options  
3.5.  Members discussed a number of options to introduce new disciplines on Blue Box support to 
ensure that programs are indeed production limiting and are used to address legitimate policy 
objectives. Options to limit Blue Box support include placing Blue Box i n an OTDS limit; placing a 
limit on overall Blue Box support; and /or introducing product specific Blue Box limits. In addition, 
some Members identified options to clarify the existing criteria in Article 6.5, such as requirement 
that payments are based on  fixed and unchanging base periods, introduction of stricter eligibility 
criteria to more clearly define "production limiting " and adding a clarification that Blue Box and 
Amber Box support cannot be applied on the same product concurrently.  
  JOB/AG/160  
 
- 4 - 
 
  Table 3: Bl ue Box - Options to strengthen rules and disciplines  
Article in 
AoA Reform through limits  Clarification of rules Additional transparency  
Article 6.5 
(Blue Box) - Introduce a cap on 
overall Blue Box support  
- Introduce Blue Box 
product specific limits  
- Include part or all of 
Blue Box in an overall 
limit (OTDS)  
- Other  - Clarify that payments are based on fixed and 
unchanging base periods  
- Clarify paragraph 6.5(a) on how production 
limiting programmes are defined  
- Clarify that Blue Box and Amber Box support 
cannot be applied on the same product 
concurrently  
- Other  - Include product specific 
VoP  
- Notification of base period 
yields, acreage, livestock  
- Include current year 
production compared to a 
previous base p eriod 
- Other  
 
4  OVERALL  TRADE -DISTORTING SUP PORT  (OTDS)  
Issues  
4.1.  Members have identified concerns that overall entitlements for some Members are increasing 
rapidly, and that Article 6 spending is also on a consistent upward trajectory. Members have noted 
that without some cap or limit placed on overall entitlements, Mem bers could have access to 
excessive amounts of production and trade -distorting support  – estimated to exceed US D 1 trillion 
by 2030. If these entitlements were utili zed, there could be  devastating distortionary impacts on 
global agricultural markets.  
Optio ns 
4.2.  Members have discussed multiple options to address overall trade -distorting support .   
4.3.  Options discussed focus on: which categories of support to capture – all Article 6 support, or 
only some elements; how to set such limits; whether limits should be se t as a fixed monetary 
amount,  or allowed to float with either a Member 's value of production or inflation rate. 
Improvements to transparency of overall support have also been suggested.  
Table 4: OTDS - Options to establish an overall limit  and imp rove tran sparency  
What is covered?  How is it set?  Floating limit Fixed limit Hybrid limit  
- All Article 6  
- Article 6.2 – 
developing country 
exemptions (or 
elements within)  
- Article 6.3 ( FBTAMS)  
- Article 6.4 ( de 
minimis ) 
- Article 6.5 - Blue Box  
- Annex 2 - Green box 
(or elements within)  - Based on VoP  
- Based on 
entitlements  
- Based on spending  
- Based on a 
monetary amount  - Do limits float 
with values of:  
 - Production?  
 - Inflation?  
 - Other?  - A fixed monetary 
amount?  
- Which currency?  - Is it fixed for a period 
before becoming floating?  
- Initially floating over a 
specified time period 
before coming fixed?  
- Certain Articles are 
floating, while others are 
fixed?  
- A fixed limit that could be 
adjusted due to 
hyperinflation?  
Options to improve transparency on overall support  
- Include a total for Overall Article 6 Support in notifications  
- Include a total for Overall Article 6 and Green Box support in notifications  
- Include total VoP in notifications  
- Include all parameters in market price support calculations in the AoA (Annex 3, paragraph 8)  
 
5  GREEN  BOX 
Issues  
5.1.  There is a general recognition that the Green Box provides numerous policy options for 
Members to provide support in a way that has "no or minimal " trade - or production -distorting effects. 
If there are new disciplines introduced into the Green Box, they mu st be developed in such a way 
that does not discourage policy reforms to less distorting programs.   
5.2.  Concerns are raised when certain types of Green Box support (e.g. certain types of direct 
payments) could have more than minimal distorting effects and tha t these types of payments may JOB/AG/160  
 
- 5 - 
 
  not be fully decoupled. In addition, there are sometimes policy challenges faced by some developing 
country Members that limit the successful implementation of Green Box programs.  
Options  
5.3.  A number of options were raised to ad dress concerns regarding the potential circumvention of 
rules on Article 6 support through Green Box support. These include: placing all or certain elements 
in the Green Box under an OTDS; clarifying certain criteria in the Green Box; and introducing 
enhan ced transparency on how programs meet the criteria in Annex 2 of the Agreement on 
Agriculture.  
Table 5: Green Box - Options to strengthen rules and disciplines  
Article  Reform through limits  Clarification of rules Additional transparency  
Annex 2 
(Green Box)  - Include all of Annex 2 
support in the Green 
Box in an OTDS  
- Include certain 
elements of Annex 2 in 
an OTDs (e.g. certain 
direct payments)  - Limit duration for support for structural 
adjustment programmes  
- Clarify that some base periods are fixed and 
unchanging  
- Clarifying rules related to income insurance 
schemes  
- Clarifying rules related to payments for 
natural disasters  - More detailed information 
on base periods used in 
providing decoupled income 
support  
 
6  SPECIAL  AND DIFFERENTIAL TR EATMENT  
6.1.  Special and Differential Treatment (S&D) for developing countries is captured in the rules for 
calculating domestic support contained in the Agreement on Agriculture, including specifically with 
regard to de minimis  levels and a ccess to Article 6.2. S&D is also referenced in both the preamble 
and Article 20 of the Agreement on Agriculture. Members continue to discuss how S&D should be 
reflected in any new commitments on domestic support.  
Issues  
6.2.  S&D can enable developing and leas t developed Members to participate in global rule making 
efforts and to benefit from multilateral agricultural reform in a manner consistent with their 
participation in agricultural markets and their development needs. However, some Members noted 
that "one size fits all " S&D does not accurately reflect the reality in global agriculture trade, levels 
of subsidization, and Members different levels of development.  
Options  
6.3.  Members have discussed a number of options for reflecting S&D in any outcome on domestic 
support. Options include: retaining all existing flexibilities for developing Members, or certain 
categories of developing Members (i.e. no change in commitments); differing S&D based on a 
Members level of development, participation in global agricultural trade or other variables; or 
extending the time offered for developing Members to meet commitments in comparison to 
developed Members.  
6.4.  A summary of some of the options for S&D is provided below . 
Table 6: Selected options for Special and Differential Treatm ent 
 Exemptions  Differentiated commitments  Implementation period  
Options  - No exemptions, rules apply 
equally to all Members  
- Developing Members apply a 
lower reduction commitment 
(not full reciprocity)  
- Exemptions from 
commitments for:  
(a) LDCs 
(b) NFIDCs  
(c) All developing Members  
- Other?  - No differentiation  
- Differentiated commitments 
depending on:  
(a) Participation in agriculture trade  
(b) Level of subsidization  
(c) VoP? 
(d) GDP?  
(e) Per Capita?  
(f) Developing country category (e.g. 
LDC, NFIDC)  
- Other  - No differentiation  
- Longer phase in periods for:  
- LDCs 
- NFIDCs  
- All developing Members  
- Or depending on:  
(a) Participation in ag trade  
(b) Value of ag production  
(c) GDP?  
(d) Per Capita?  
- Other  
 
  JOB/AG/160  
 
- 6 - 
 
  ANNEX  
ALL OPTIONS FOR ADDR ESSING DOMESTIC SUPP ORT 
Article 
in AoA  Options to strengthen rules and disciplines  
Reform through limits  Clarification of rules Additional transparency  
6.2 - Introduce a limit for 6.2 based on:  
 - Historical spending  
 - VoP 
 - Other 
- Include all 6.2 or just parts (e.g. 
exclude illicit crops)  
- Include part or all of 6.2 in an 
overall limit (an OTDS)  - Clarification of "generally 
available "? 
- Clarification of "low-income or 
resource poor  producers "? 
- Clarify that support should go 
directly to producers and not 
suppliers of inputs (e.g. electrical 
utilities, or fertilizer suppliers)?  
- Other  - More complete programme 
descriptions  
- More complete breakdowns of 
expenditure – i.e program by 
program  
- Information to show how criteria 
are met?  
- Other  
6.3 
(FBTAM 
and 
CTAMS)  - Reduce FBTAMS  
- Introduce product  specific 
disciplines (e.g. anti -concentration 
clause, product specific disciplin es 
based on export s/import s) 
- Introduce standstill on product -
specific support  
- Include in an overall limit (OTDS)  
- Other  - Clarification of calculation 
methodologies (e.g. market price 
support (MPS))  
- Clarification of non -product -
specific definition  
- Other  - Add total Value of Production 
(VoP) and product specific VoP 
to notification templates  
- Include additional information 
on the calculation of market 
price support  
- Inclusion of harmoni zed product 
descriptions for product -specific 
support  (e.g. tariff codes)  
- Other  
6.4 (de 
minimis ) - Reduce de minimis  percentage  
- Different de minimis  levels 
between product specific and non-
product -specific support   
- Introduce standstill on product -
specific support  
- Include in an overall limit (OTDS)  
 
 - Clarification of calculation 
methodologies (e.g. market price 
support (MPS))  
- Clarification of non -product 
support  
- Other  - Add total VoP and product 
specific VoP to notification 
templates  
- Include addition information on 
the calculatio n of market price 
support in notification templates  
- Inclusion of harmoni zed product 
descriptions for product -specific 
support  (e.g. tariff codes)  
- Other  
6.5 
(Blue 
box) - Introduce a cap on overall Blue 
Box support  
- Introduce Blue Box product 
specific limits  
- Include part or all of Blue Box in 
an overall limit (OTDS)  
- Other  
 - Clarify that payments are based on 
fixed and unchanging base periods  
- Clarify paragraph 6.5(a) on how 
production limiting programmes 
are defined  
- Clarify that Blue Bo x and Amber 
Box support cannot be applied on  
the same product concurrently  
- Other  - Include product specific VoP  
- Notification of base period 
yields, acreage, livestock  
- Include current year production 
compared to a previous base 
period  
- Other  
Annex 2 
(Green 
Box) - Include all of Annex 2 support in 
the Green Box in an OTDS  
- Include certain elements of 
Annex  2 in an OTDs (e.g. certain 
direct payments)  - Limit duration for support for 
structural adjustment programmes  
- Clarify that some base peri ods are 
fixed and unchanging  
- Clarifying rules related to income 
insurance schemes  
- Clarifying rules related to 
payments for natural disasters  - More detailed information on 
base periods used in providing 
decoupled income support  
Options to establish an overall limit  
What is covered?  How is it set?  Floating limit Fixed limit Hybrid limit  
- All Article 6  
- Article 6.2 – Developing 
country exemptions (or 
elements within)  
- Article 6.3 ( FBTAMS)  
- Article 6.4 ( de minimis ) 
- Article 6.5 - Blue Box  
- Annex 2 - Green Box (or 
elements within)  - Based on VoP  
- Based on 
entitlements  
- Based on spending  
- Based on a 
monetary amount  - Do limits float 
with values of:  
- Production?  
- Inflation?  
- Other? - A fixed 
monetary 
amount?  
- Which 
currency?  - Is it fixed for a period before 
becoming floating?  
- Initially floating over a specified 
time period before coming fixed?  
- Certain Articles are floating, 
while others are fixed?  
- A fixed limit that could be 
adjusted due to hyperinflation?  
Options to improve transparency on overall support  
- Include a total for Overall Article 6 Support in notifications  
- Include a total for Overall Article 6 and Green Box support in notifications  
- Include total VoP in notifications  
- Include all parameters in market price support calculations in the AoA (Annex 3, paragraph 8)  
 
 
__________