G/AG/W/161  
 
9 May 2017  
(17-2510) Page: 1/89 
Committee on Agriculture   
 
RESPONSES TO POINTS RAISED BY MEM BERS UNDER THE REVIE W PROCESS  
COMPILATION OF RESPONSES TO QUESTIONS RAISED DURING THE CO MMITTEE  
ON AGRICULTURE MEETI NG ON  27 MARCH 20171 
The present document compiles responses received in writing by the Secretariat to the questions 
raised in document G/AG/W/160 as well as follow -up comments made during the Review Process.  
 
Written responses to the following quest ions were not provided before 3 May 2016 : 
 
AG-IMS ID  Answer by  Question by  Notification Reference  
83042  India United States of America  Article 18.6  
83087, 83089, 83090,  
83088  Jordan  United States of America  G/AG/N/JOR/19, G/AG/N/JOR/20  
83128  Jordan  Canada  G/AG/N/JOR/19, G/AG/N/JOR/20  
83059  Jordan  New Zealand  G/AG/N/JOR/19, G/AG/N/JOR/20  
83021  Mali European Union  G/AG/N/MLI/8  
83091  Mali United States of America  G/AG/N/MLI/8  
830222, 830252, 83026,  
830242, 830232 Russian Federation  European Union  G/AG/N/RUS/11  
83094  Togo United States of America  G/AG/N/TGO/8  
 
 
 
                                                
1 This document has been prepared u nder the Secretariat 's own responsibility and is without prejudice 
to the positions of Members or to their rights and obligations under the WTO.  
2 The Russian Federation had provided a preliminary response to this question and undertook to provide 
a detail ed response at a later stage.   G/AG/W/161  
 
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  TABLE OF C ONTENTS  
1   MATTERS RELEVANT TO THE IMPLEMENTATION O F COMMITMENTS: ARTIC LE 
18.6 ................................ ................................ ................................ ................................ . 5 
1.1   Australia's wine equalization tax  ................................ ................................ ....................  5 
1.1.1    Question by European Union (AG -IMS ID 83006)  ................................ ..........................  5 
1.2   Canada's Agri -Marketing Program  ................................ ................................ ..................  5 
1.2.1    Question by Indonesia (AG -IMS ID 83067)  ................................ ................................ .. 5 
1.3   Egypt's new regulations ................................ ................................ ................................  6 
1.3.1    Question by Indon esia (AG -IMS ID 83068)  ................................ ................................ .. 6 
1.4   United Kingdom - Modification of agricultural schedule of commitments  .............................  7 
1.4.1    Question by Indon esia (AG -IMS ID 83069)  ................................ ................................ .. 7 
1.5   European Union's support for livestock sector  ................................ ................................ . 7 
1.5.1    Question by New Zealand (AG -IMS ID 83055)  ................................ ..............................  7 
1.6   India's minimum support price for wheat  ................................ ................................ ........  9 
1.6.1    Question by Australia (AG -IMS ID 83106)  ................................ ................................ .... 9 
1.7   India's minimum price for sugar cane in Uttar Pradesh  ................................ .................... 10 
1.7.1    Question by European Union (AG -IMS ID 83010)  ................................ ......................... 10 
1.8   India's trade statistics  ................................ ................................ ................................ .11 
1.8.1    Question by United States of America (AG -IMS ID 83044)  ................................ ............ 11 
1.9   India's buffer stocks of pulses  ................................ ................................ ...................... 11 
1.9.1    Question by Canada (AG -IMS ID 83122)  ................................ ................................ .....11 
1.10   India's support price for Rabi c rops ................................ ................................ ............. 11 
1.10.1    Question by European Union (AG -IMS ID 83009)  ................................ ....................... 11 
1.11   Indonesia's draft regulation on supply and distribution of milk products  ........................... 12 
1.11.1    Question by European Union (AG -IMS ID 83011)  ................................ ....................... 12 
1.12   Japan's mark -up on imported rice  ................................ ................................ ............... 12 
1.12.1    Question by China (AG -IMS ID 83035)  ................................ ................................ .....12 
1.13   Russia's higher applied tariffs than bound rates  ................................ ............................ 12 
1.13.1    Question by European Union (AG -IMS ID 83012)  ................................ ....................... 12 
1.14   Thailand's import permits for feed wheat  ................................ ................................ .....13 
1.14.1    Question by Australia (AG -IMS ID 83107)  ................................ ................................ .13 
1.14.2    Question by European Union (AG -IMS ID 83013)  ................................ ....................... 14 
1.14.3   Question by United States of America (AG -IMS ID 83045)  ................................ .......... 14 
1.15   Thailand's financial assistance to fruit farmers  ................................ .............................. 15 
1.15.1    Question by United States of America (AG -IMS ID 83047)  ................................ .......... 15 
1.16   U.S. Federal Milk Marketing Order (FMMO)  ................................ ................................ ...16 
1.16.1    Questio n by Canada (AG -IMS ID 83124)  ................................ ................................ ...16 
1.17   Brazil's domestic support programmes  ................................ ................................ ........ 18 
1.17.1    Question by United States of America (A G-IMS ID 83038)  ................................ .......... 18 G/AG/W/161  
 
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  1.18   Canada's New Milk Ingredient Class  ................................ ................................ ............ 19 
1.18.1    Question by Australia (AG -IMS ID 83103)  ................................ ................................ .19 
1.18.2    Question by European Union (AG -IMS ID 83008)  ................................ ....................... 21 
1.18.3    Question by New Zealand (AG -IMS ID 83002)  ................................ ........................... 21 
1.18.4    Question by New Zealand (AG -IMS ID 83054)  ................................ ........................... 23 
1.18.5    Question by New Zealand and United States of America (AG -IMS ID 83134 and 
AG-IMS ID 83039)  ................................ ................................ ................................ ............. 24 
1.19   Canada's wine sale policy  ................................ ................................ .......................... 28 
1.19.1    Question by Australia (AG -IMS ID 83104)  ................................ ................................ .28 
1.19.2    Question by European Union (AG -IMS ID 83007)  ................................ ....................... 29 
1.19.3    Question by New Zealand and United States of America (AG -IMS ID 83135 and 
AG-IMS ID 83041)  ................................ ................................ ................................ ............. 30 
1.20   Canada's tariff -rate quota for cheese  ................................ ................................ ........... 30 
1.20.1    Question by New Zealand, Norway and Switzerland (AG -IMS ID 83003, AG -IMS 
ID 830 05 and AG -IMS ID 83004)  ................................ ................................ ......................... 30 
1.21   Canada's market price support for dairy products  ................................ ......................... 31 
1.21.1    Question by New Zealand (AG -IMS I D 83001)  ................................ ........................... 31 
1.22   India's minimum support price for Kharif crops  ................................ ............................. 32 
1.22.1    Question by Canada and the United States of Americ a (AG -IMS ID 83123 and 
AG-IMS ID 83043)  ................................ ................................ ................................ ............. 32 
1.23   India's importation of apples  ................................ ................................ ...................... 32 
1.23.1    Question by New Zealand (AG -IMS ID 8 3056)  ................................ ........................... 32 
1.24   India's sugar export subsidies  ................................ ................................ .................... 33 
1.24.1    Question by Australia (AG -IMS ID 83105)  ................................ ................................ .33 
1.25   India's wheat stocks and exports  ................................ ................................ ................ 33 
1.25.1    Question by United States of America (AG -IMS ID 83042)  ................................ .......... 33 
1.26   Switzerland's export subsidy budget  ................................ ................................ ........... 35 
1.26.1    Question by New Zealand (AG -IMS ID 83057)  ................................ ........................... 35 
1.27   Thailand's rice policies  ................................ ................................ ............................... 35 
1.27.1    Question by United States of America (AG -IMS ID 83046)  ................................ .......... 35 
1.28   Turkey's subsidies aimed at  incentivising the use of domestic dairy  ................................ .37 
1.28.1    Question by New Zealand (AG -IMS ID 83058)  ................................ ........................... 37 
1.29   Zambia's public stocks and exports of maize  ................................ ................................ 38 
1.29.1    Question by European Union (AG -IMS ID 83014)  ................................ ....................... 38 
2   POINTS RAISED IN CON NECTION WITH INDIVID UAL NOTIFICATIONS  ....................  39 
2.1   IMPORTS UNDER TARIFF AND OTHER QUOTA COMMITMENTS (TABLE MA:2)  ..................... 39 
2.1.1    Iceland (G/AG/N/ISL/37)  ................................ ................................ .......................... 39 
2.1.2    Republic of Moldova (G/AG/N/MDA/7)  ................................ ................................ ........ 39 
2.2   SPECIAL SAFEGUARDS (TABLES MA:3 TO MA:5)  ................................ ............................ 39 
2.2.1    Japan (G/AG/N/JPN/214)  ................................ ................................ .......................... 39 
2.2.2    Chinese Taipei (G/AG/N/TPKM/141)  ................................ ................................ ........... 40 
2.2.3    Chinese Taipei  (G/AG/N/TPKM/142)  ................................ ................................ ........... 40 G/AG/W/161  
 
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  2.2.4    United States of America (G/AG/N/USA/111)  ................................ .............................. 40 
2.3   DOMESTIC SUPPORT COMMITMENTS (TABLE DS:1)  ................................ ........................ 41 
2.3.1    Argentina (G/AG/N/ARG/36)  ................................ ................................ ..................... 41 
2.3.2    Brazil (G/AG/N/BRA/41, G/AG/N/BRA/40, G/AG/N/BRA/32)  ................................ .......... 44 
2.3.3    Canada (G/AG/N/CAN/113)  ................................ ................................ ....................... 48 
2.3.4    Chile (G/AG/N/CHL/48)  ................................ ................................ ............................ 50 
2.3.5    European Union (G /AG/N/EU/34)  ................................ ................................ ............... 51 
2.3.6    Jordan (G/AG/N/JOR/19, G/AG/N/JOR/20)  ................................ ................................ ..53 
2.3.7    Mali (G/AG/N/MLI/8)  ................................ ................................ ................................ 56 
2.3.8    Republic of Moldova (G/AG/N/MDA/6)  ................................ ................................ ........ 57 
2.3.9    Russian Federation (G/AG/N/RUS/11)  ................................ ................................ ........ 58 
2.3.10   Togo (G/AG/N/TGO/8)  ................................ ................................ ............................ 61 
2.3.11    United States of America (G/AG/N/USA/109) ................................ ............................. 61 
2.4   NEW OR MODIFIED DOMESTIC SUPPORT MEASURE S (DS:2)  ................................ ........... 66 
2.4.1    Canada (G/AG/N/CAN/114)  ................................ ................................ ....................... 66 
2.4.2    European Union (G/AG/N/EU/35)  ................................ ................................ ............... 67 
2.4.3    Mexico (G/AG/N/MEX/33)  ................................ ................................ ......................... 74 
2.4.4    Peru (G/AG/N/PER/16)  ................................ ................................ ............................. 78 
2.4.5    United States of America (G/AG /N/USA/110)  ................................ .............................. 79 
2.5   EXPORT SUBSIDY COMMITMENTS (TABLES ES:1, ES:2 AND ES:3)  ................................ ...81 
2.5.1    Switzerland (G/AG/N/CHE/79)  ................................ ................................ ................... 81 
3   OVERDUE NOTIFICATION S ................................ ................................ ........................  82 
3.1   Egypt  ................................ ................................ ................................ ........................ 82 
3.2   India ................................ ................................ ................................ ......................... 83 
3.3   Indonesia  ................................ ................................ ................................ .................. 83 
3.4   Thailand  ................................ ................................ ................................ .................... 84 
3.5   Turkey  ................................ ................................ ................................ ...................... 84 
4   OTHER  ................................ ................................ ................................ .......................  85 
4.1   New Zealand AG -IMS ID 83037: Question by Chile  ................................ ......................... 85 
ANNEX A  ................................ ................................ ................................ ........................  87 
ANNEX B  ................................ ................................ ................................ ........................  89 
 G/AG/W/161  
 
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  1  MATTERS RELEVANT TO THE IMPLEMENTATION O F COMMITMENTS: ARTIC LE 18.6  
1.1  Australia's wine equalization tax  
1.1.1   Question by European Union (AG -IMS ID 83006)  
Under the  Australian producer rebate scheme for the wine equalization tax, Australian 
producers are entitled to a rebate of 29% of the wholesale value of domestic wine sales 
and applications to own use. Bilaterally Australia has confirmed the European Union that 
importers of foreign wine are entitled to the rebate as well. Nevertheless, applying for 
the rebate is much more burdensome for foreign wine importers than for domestic 
producers. This has been confirmed in the Australian Senate's Rural and Regional Affairs 
and Transport Committee's hearing held on 18 October 2016, where the Australian 
Assistant Minister appears to have said that the legislative definitions are going to 
"significantly reduce the number of people from offshore who would be able to access 
the r ebate." In the light of this, could Australia explain how it sees its wine taxing policy 
complying with Article III:2 of GATT, which rules that: "The products of the territory of 
any contracting party imported into the territory of any other contracting pa rty shall not 
be subject, directly or indirectly, to internal taxes or other internal charges of any kind 
in excess of those applied, directly or indirectly, to like domestic products."  
 
Answer by Australia  
 
The Australian government has announced changes to the wine equalisation tax (WET) rebate that 
will improve its integrity and better target support to small wine producers.  
 
From 1 July 2018, eligibility for the rebate will be tightened, including by requiring wine producers 
to own at least 85% of the grapes used to make the wine throughout the winemaking process, and 
limiting the rebate to wine branded with a registered trademark, and packaged in a container not 
exceeding five litres. The rebate cap will also be reduced from $500,000 to $350,000 from 
1 July 2018.  
 
These changes will apply equally to Australian wine producers and to foreign wine producers who 
access the rebate.  
 
Follow -up: The United States noted  its interest in the question.  
 
1.2  Canada's Agri -Marketing Program  
1.2.1   Question by Indonesia (AG -IMS ID 83067)  
The government of Canada over the last five years (2013 -2018) has been implementing 
Agri-Marketing programme with the provision of grants amounting to CAD  341 million. 
The Agri -Marketing Program helps farmers and food processors compete in mark ets at 
home and abroad. It supports the agriculture industry by creating and maintaining 
access to markets and taking advantage of market opportunities.  
 
a. What are the requirements to be fulfilled by farmers to access this programme?  
b. How is the calculatio n of the government's budget managed to provide relief to 
farmers on this programme?  
c. There is information that the project expenditure which can be subsidized 
through this programme in the form of the contracted services, travel, capital 
and other expendi tures. Indonesia is concerned that this policy will affect 
commitment to implement Nairobi Ministerial Decision related to export 
competition.  G/AG/W/161  
 
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  Answer by Canada  
 
a. Farmers are not eligible under this programme. The programme provides matching 
contribution s to national not -for-profit agricultural organizations aimed at helping these 
organizations develop and implement long -term strategies, as well as national assurance 
systems such as those relating to traceability, food safety and biosecurity, to help the 
agricultural sectors prosper (e.g., canola). Moreover, a small portion of the funds are 
earmarked to assist small and medium sized enterprises (SMES) to promote Canadian 
agriculture and agri -food products.  
b. As noted, these funds are not available to far mers.  
c. The Agri -Marketing Program does not affect Canada's implementation of the Nairobi 
Decision on export competition.  
Follow -up: Indonesia urged all Members to respect their export subsidy commitments and to 
demonstrate transparen cy in their domestic  policies.  
 
1.3  Egypt's new regulations  
1.3.1   Question by Indonesia (AG -IMS ID 83068)  
The government of Egypt issued Minister of Trade and Industry Decree No.  43/2016 on 
the Amendment on the Procedures of Exporter's Registration.  
 
The Decree requires exporters to r egister and prohibits the trade of goods, including 
some agriculture products, except those goods that are produced by licensed/registered 
companies/manufacturers or importers who holds a registered trademark.  
 
The Presidential Regulation No. 538/2016 on new customs tariff came into force on 
30 November  2016.  
 
 The amendment of the regulation aims to increase tariff from the average of 30% 
to 60% for 320 imported goods (including agricultural products).  
 The increased tariff is added by 13% of value added tax (VAT), and rise to 14% of 
VAT in  2017. This policy does not apply to the European Union, Arabian countries, 
and the members of COMESA  
a. What is the rationale of those regulations?  
b. Can Egypt explain how these requirements are in compliance with Article  IV: 2 
of the  AoA, Article II and Article XI: 1 of the GATT?  
Answer by Egypt  
 
Ministerial Decree 43/2016:  
 
With regard to Ministerial decree No 43 for year 2016, at the outset Egypt would like to confirm 
that the Egyptian government did not prohibit any im ports neither according to this regulation or 
any other newly issued regulation.  
 
Decree 43 for year 2016 requires registration of the manufacturing plants and the companies 
owning trademarks qualified to export their products to Egypt, and this decree is administrative in 
nature, and does not require any changes in production methods, or impose further burdens on 
producers or companies in the exporting markets.  
 
Egypt believes that any credible manufacture or company would not face any difficulty complyin g 
with this registration requirement.  
 G/AG/W/161  
 
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  Egypt would like to confirm that Decree 43 does not constitute any restriction on imports and is in 
compliance with Article XX.b and Article XI.2(b) of GATT.  
 
Finally, as this decree is related to standards and does  not fall within the ambit of Agreement on 
Agriculture, Egypt has notified it to the committee of Technical Barrier to Trade in 
document  G/TBT/N/EGY/114, which is currently being reviewed by Members.  
 
Presidential Decree 538/2016:  
 
With regard to President ial decree No 538 for year 2016, which includes increasing tariff on 
number of products including some agriculture products, Egypt confirms that all increased tariffs 
are in accordance with its schedule of commitments and are within its tariff binding conc essions. 
Therefore the decree is in compliance with Article IV of Agreement on Agriculture, and Article II of 
GATT.  
 
Ministerial Law 67/206 for Value Added Tax (VAT):  
 
Minister of finance issued law No 67 which entered into force in September 2016. The ne w law 
increased the value added tax from 13% to only 14%. The new increase will be applied in the 
coming fiscal year starts from 1 July 2017 and will replace the current sales tax.  
 
The VAT is subject to internal regulation, and is being applied to both d omestic and imported 
products in accordance with Article III of GATT.  
 
Egypt would like to draw Member's attention that imposing VAT as internal regulation is in 
compliance with WTO rules, and does not fall within Agriculture specific commitments and 
therefore Agreement on Agriculture.  
 
Egypt remains available for any further clarifications from Members.  
 
Follow -up: The United States noted its interest in this question.  
 
1.4  United Kingdom - Modification of agricultural schedule of commitments  
1.4.1   Question by Indonesia (AG -IMS ID 83069)  
Following United Kingdom's decision to leave the European Union, Indonesia 
understands that there will be a renegotiation on UK's Schedule of Commitments (SOC).  
 
a. How would the Generalized Scheme of Preference (GSP) granting pro cedure be 
for developing countries?  
b. How would United Kingdom's Customs Procedure, including the arrangement of 
Tariff Rate Quota  (TRQ) Policy be for the agricultural products?  
Answer by European Union  
 
The European Union common external trade policy appl ies to all its member States and the 
United  Kingdom is still a member of the European Union. It is not possible to reply at the moment 
but a more substantive reply can be provided in due course.  
 
Follow -up: Argentina, China, the Russian Federation and the United States expressed interest in 
this topic.  
 
1.5  European Union's support for livestock sector  
1.5.1   Question by New Zealand (AG -IMS ID 83055)  
In October 2015, the Commission announced a package of measures for the livestock 
sector totalling EUR  420 m, with the  possibility of member States matching it with their 
own funds. 24  member States provided aid on a per production unit basis, and 
15 member States included national top ups from their own coffers.  G/AG/W/161  
 
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  a. Can the Commission outline the total amount from member St ates and 
Commission funds allocated to the livestock sector on a per production unit 
basis?  
b. Can the Commission indicate how it intends to notify this aid, and whether this 
would form part of the European Union's Amber Box support?  
c. What measures were take n to ensure the aid has no, or at most minimal trade 
distorting effects or effects on production? In March 2016, the Commission 
undertook to examine further changes to its state aid regime that would allow 
more national funds to be channelled to farmers, t o alleviate the effects of 
lower dairy prices.  
d. What measures are taken by the Commission or the EU member States to 
ensure that State Aid provided to the agriculture sector is consistent with 
obligations under the Agreement on Agriculture?  
e. Can the Commis sion provide a figure for the total State Aid provided to the 
livestock sector on a per production unit basis since March 2016? In September 
2016, the Commission announced a further EUR 350m aid package for the 
livestock sector, with the possibility of mat ched funds from member States up 
to 100% of that total:  
f.  Were any of the funds provided by the Commission, or member States as part 
of the September 2016 package, provided on a per production unit basis?  
Answer by European Union  
 
a. Information on the to tal amounts allocated from the EU budget under the 2015 targeted 
aid scheme is available on the Europa website at: 
http://ec.europa .eu/agriculture/sites/agriculture/files/milk/policy -instruments/milk -use-
targeted -aid_en.pdf . The amounts cannot be set out on a per production unit basis, as 
some member States opted for more complex measures that do not translate into a per 
unit payment  
b. This aid will be notified in due time, as Amber Box support.  
c. In compliance with the principle of subsidiarity, member States were entrusted to use 
the amounts available to them for measures taken on the basis of objective and 
non-discriminatory crit eria, provided that the resulting payments did not cause 
distortions of competition.  
d. The measures did not involve any changes to the State Aid instruments normally applied 
by the Commission, but were authorised directly under Article 107 (3) (c) TFEU, w hich 
allows for the granting of aid to facilitate the development of certain economic activities 
or of certain economic areas, provided it does not adversely affects trading conditions to 
an extent contrary to the common interest. Hence, member States were  allowed to set 
up ad hoc schemes by which they could temporarily simplify access to finance for 
farmers in the sectors that were severely hit by market crisis in 2016. Although the 
access to these schemes was restricted to farmers in a few product sectors , the aid was 
not linked to production other than in the sense that those of the schemes that involved 
direct grants were made subject to the condition that the beneficiaries had to commit to 
reduce or freeze production levels. Otherwise, most of the schem es took the form of 
loans and guarantees aiming at helping farmers bridge temporary liquidity gaps and was 
thus non -product specific.  
The Commission assessed these ad hoc schemes on a case -by-case basis, using by 
analogy the principles and conditions laid  down in the Commission Guidelines applicable 
to State Aid in agriculture, which serve the purpose of limiting the impact of State Aid on 
the functioning of the market. These principles and conditions are objective criteria, 
considered to be consistent wit h the obligations under the Agreement on Agriculture.  G/AG/W/161  
 
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  e. The EU rules on State Aid in the agricultural sector does not allow for the granting of aid 
per production unit (in terms of production aid). This principle applied also to the ad hoc 
schemes authori sed in 2016. Moreover, the aid measures covered by the agricultural 
State Aid instruments are generally not linked to specific product sectors but to specific 
aid objectives, of the same kind as those pursued under the CAP legislation on rural 
development.  Only a few measures are specifically related to the livestock sector; they 
concern aid that contributes to the maintenance and improvement of genetic quality, aid 
for removal and destruction of fallen stock and aid for animal welfare commitments. The 
aid amounts paid in 2016 and 2017 are not known yet, as the relevant data will be 
available only at the beginning of year 2018.  
In September 2016, the Commission announced a further EUR  350m aid package for the 
livestock sector, with the possibility of matched  funds from member States up to 100% 
of that total:  
f. Information on the measures applied by member States under the 2016 exceptional 
adjustment aid is available on the Europa website: 
http://ec.europa.eu/agriculture/sites/agriculture/files/milk/policy -instruments/milk -
targeted -aid_en.pdf .  
Information on the milk production reduction scheme is also available on the Europa 
website: http://ec.europa.eu/agriculture/sites/agriculture/files/milk/policy -
instruments/applications -payments_en.pdf .  
Both schemes are curre ntly running. Information can therefore change as time goes by. 
Updates will be posted on the Europa website.  
Follow -up: Australia, Canada, and the United States indicated interest in the question.  
 
1.6  India's minimum support price for wheat  
1.6.1   Question by Aust ralia (AG -IMS ID 83106)  
In November 2016, the Food Corporation of India lifted the minimum support price for 
wheat to 1,625  rupees per 100  kg, or close to USD  250 per tonne. According to the Food 
Corporation of India website ( http://fci.gov.in/procurements.php?view=89 ) the 
government of India has raised the support price for wheat every year since 2006. 
World wheat prices, however, remain low at only around US D147 a tonne in February 
2017. The Foo d Corporation of India will therefore be buying wheat at more than 
USD100 per tonne above world market prices. Why is the Indian government continuing 
to raise the minimum support price for wheat?  G/AG/W/161  
 
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  FCI Procurement Price versus World Price  
 
Source:  FCI pr ocurement price converted using USDA Real Country Monthly Average annual exchange rates; 
World price from Indexmundi monthly price, Wheat No.1.  
 
Answer by India  
 
The Minimum Support Price (MSP) is fixed to protect farmers from distress sale of their produc e 
and to protect them from exploitation. Minimum Support Prices (MSPs) are announced by the 
government following the recommendations of the Commission for Agricultural Costs and Prices 
(CACP). The CACP takes into account various factors including the cost of cultivation/production, 
changes in input prices, input/output price parity, inter -crop price parity, effects on the cost of 
living, effects on general price level, parity between prices paid and prices received by 
farmers,  etc.  
 
Follow -up: Australia no ted that Members, at a time of low price s and oversupply  of wheat , should  
endeavour to restrain  measures adopted on wheat. Australia noted that raising minimum support 
prices was counter to what Members should be doing in terms o f ensuring well -functioning  
market s. The United States supported Australia’s question. Canada and Ukraine, as major wheat 
producers and exporters, flagged their commercial interest in Members’ policies which could 
impact the supply and demand for wheat. The European Union noted that India's support price was 
continuously increasing compared to market prices for  wheat.  
 
1.7  India's minimum price for sugar cane in Uttar Pradesh  
1.7.1   Question by European Union (AG -IMS ID 83010)  
India - minimum price for sugar cane in Uttar Pradesh  
 
The state of  Uttar Pradesh increased the State Advised Price (SAP) in November 2016 
for sugar cane by 9% from 280 to 305 rupees per quintal. This comes on top of an 
increase from 240 to 280  rupees per quintal in 2012 -13, being in total an increase of 
25%. http://www.business -standard.com/article/economy -policy/up -hikes -sugarcane -
price -by-rs-25-quintal -for-2016 -17-crushing -season -116111800458_1.html  
 
Can India explain more in detail the consequences of the increases on total sugar 
production, and whether some of these sugar quantities end up on export markets?  
 
Answer by India  
 
The State Advised Price is only an indicative pricing mechanism. The production of sugarcane is 
dependent on various factors including rainfall, availability of fertilizers and proper climatic 
conditions. Exports are determined by commercial considerations and demand -supply conditions.  
 G/AG/W/161  
 
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  Follow -up: Australia and the United States indicated interest in this issue.  
 
1.8  India's trade statistics  
1.8.1   Question by United States of America (AG -IMS ID 83044)  
In response to AG -IMS ID 79015, India stated it was "not desirable" to respond to the 
U.S. inquiry  to better understand India's commitments. In the same question, the United 
States requested the information cited by India in response to AG -IMS ID 78035 
regarding the "widely available standard source of trade statistics". The United States 
again request s that India share the information.  
 
Answer by India  
 
The External Reference Prices are contained in India's AGST, which was accepted by all Members 
following a process of consultation and discussion after the Uruguay Round.  
 
Follow -up: The United States n oted that the ir main interest was to find the sources for those 
statistics.  
 
1.9  India's buffer stocks of pulses  
1.9.1   Question by Canada (AG -IMS ID 83122)  
Media reports indicate that India is creating by June 2018 a buffer stock of up to 
2 million tonnes of pulses  comprised of domestic and imported pulses. Could India 
indicate how much of this 2  million tonnes has been acquired? Does India anticipate an 
increase or decrease to the volume of this buffer stock?  
 
Answer by India  
 
The information is available in the p ublic domain and can be seen at the following link: 
http://pib.nic.in/newsite/PrintRelease.aspx?relid=158167   
 
Follow -up: The European Union, Ukraine and the United States support ed Canada's question.  
 
1.10  India's support price for Rabi crops  
1.10.1   Question by European Union (AG -IMS ID 83009)  
The government of India announced at the end of 2016 an increase in the minimum 
support prices  (MSP) for the Rabi -harvest. 
http://pib.nic.in/newsite/PrintRelease.aspx?relid=130275 . Since 2014 the total 
increase for wheat is almost 7%, reaching a price of 16,250 rupees/t and for barley is 
8% to reach 13,250 rupees/t. For lentils the  MSP was increased by 16% to 
39,500  rupees/t and for colza/mustard by 10% to 37,000 rupees/t.  
 
Can India confirm that the entire production of these crops is eligible for this minimum 
support price, and what quantity has in fact been bought in by the fede ral or regional 
governments?  
 
Answer by India  
 
Minimum support prices are intended to provide minimum remunerative prices to farmers so that 
they do not have to resort to distress sales. For most of the commodities under  MSP, generally 
market prices rule above MSP and, therefore, government is not required to make any 
procurement. The government intervenes only when market prices fall below MSP. Another aspect 
is that the government does not procure in all the States, hence entire production is not covered . 
Procurement figures are available in the public domain and can be accessed through Department 
of Food and Public Distribution website http://dfpd.nic.in/food -grain-bulletin.htm . 
 G/AG/W/161  
 
- 12 - 
 
  Follow -up: Australia asked India to clarify the statement that minimum support prices were often 
below world market prices, which, as noted by Australia in its previous follow -up comments, was 
not the case for wheat. The United States asked if the website would publish i nformation on which 
states were not covered by the programme.  
 
1.11  Indonesia's draft regulation on supply and distribution of milk products  
1.11.1   Question by European Union (AG -IMS ID 83011)  
The draft regulation on supply and distribution of milk products (Article 2 2) contains 
provisions which limit imports of dairy products to situations where domestic supply is 
deemed insufficient. The draft regulation also requires fresh milk importers to source 
milk locally to be allowed to import.  
 
Can Indonesia explain how they  see these requirements complying with Article  III:4 and 
Article  XI:1 GATT?  
 
Answer by Indonesia  
 
Indonesia thanks the European Union for their interests in the draft regulation on supply and 
distribution of milk products in Indonesia.  
 
The regulation was  drafted with a view to improve the upstream policies with regard to domestic 
logistic policies including production and distribution.  
 
From the outset, these policies were aimed at improving supply and distribution chain of milk in 
Indonesia. Indonesia d oes not prohibit importation of milk since it is a priority policy for Indonesia.  
 
In order to provide the best milk for consumers, the government is increasing the productivity and 
population of dairy cattle and improving the quality of milk.  
 
Indonesia wishes to inform the Committee that this draft regulation has been terminated due to 
objections by some stakeholders.  
 
Follow -up: The United States supported the European Union's question.  
 
1.12  Japan's mark -up on imported rice  
1.12.1   Question by China (AG -IMS ID 83 035)  
Japan applies mark -up on rice imported under the Simultaneous -Buy-Sellsystem  (SBS). 
In 2016, a mark -up of JPY 47,000 per tonne was posed on rice distributed in domestic 
market, approximately 50% of the import price. Please explain the legal basis for such 
mark -up. 
 
Answer by Japan  
 
The government of Japan collects mark -ups from imported rice in accordance with Japan's 
Schedule of concessions in the WTO Agreement.  
 
Follow -up: The United States noted its interest in the question.  
 
1.13  Russia's higher applie d tariffs than bound rates  
1.13.1   Question by European Union (AG -IMS ID 83012)  
The Russian Federation applies import duties for a certain agricultural tariff lines in 
HS Chapters  02, 15 and 20 which are higher than the bound rates corresponding to 
Russia's commit ments when joining the WTO by applying a compound tariff (a minimum 
specific rate of duty plus an ad valorem rate) that differs from the ad valorem rate in 
Russia's WTO Schedule.  
 G/AG/W/161  
 
- 13 - 
 
  Example 1: 0207.13.40.09 (Fresh Backs and Necks of Fowls) with "80% but not less 
than 0.7  EUR/kg" applied rate instead of "80%" bound rate;  
 
Example 2: 0207.27.10.01 (Frozen Boneless Cuts Of Turkey) with "25% but not less 
than 0.2  EUR/kg" applied in -quota rate instead of "25%" bound in -quota rate.  
 
Could the Russian Federation ex plain how these applied rates comply with its bound 
commitments?  
 
Answer by the Russian Federation  
 
The question from the  European Union has motivated the Russian Federation to stud y its tariffs 
and to find out Members' positions and interests regarding  the Russian Federation's commitments.  
  
The Russian Federation is in the process of examining  its schedules and tariffs and would like to 
receive all the comments from the European Union  concerning this question. The Russian 
Federation would also like to not e that all tariffs applied by the Russian Federation are adopted at 
the level of the Eurasian  Economic Union .  
 
Follow -up: The United States noted its support for the question.  
 
1.14  Thailand's import permits for feed wheat  
1.14.1   Question by Australia (AG -IMS ID 831 07) 
Australia notes Thailand's Cabinet resolution of 8 November 2016 titled Import 
administration measures for products that substitute maize. The resolution endorsed a 
Ministry of Commerce proposal which specifically directs relevant Thai government 
agenc ies to limit imports of feed wheat to stabilize the domestic price of maize.  
 
Australia notes that subsequent to the Cabinet resolution, new measures were put in 
place in Thailand which restrict access to import permits for wheat for animal feed and 
also require Thai importers to purchase three units of Thai maize for each unit of feed 
wheat imported.  
 
Australia is aware that these measures are outlined in Thailand's Ministry of Commerce 
documents.  
 
Notification Re: Wheat importation into the Kingdom of T hailand being required to 
have import permission and to follow the import control measures 
(16 November  2016).  
 
Regulation Re: Criteria, procedure and conditions for importation of wheat into the 
Kingdom of Thailand (20 December 2016).  
 
To date, Thailand is yet to notify any of these changes to relevant committees of the 
WTO. Given these measures have now been in place for approximately three months, 
Australia seeks clarification as to:  
a. Why Thailand is yet to notify any of these changes? Australia encoura ges 
Thailand to notify and allow an opportunity for trading partners to comment.  
b. Are the measures considered temporary or permanent? If temporary, please 
advise the term of the measures.  
c. Details regarding implementation of the measures, including how fee d wheat 
will be differentiated from wheat for milling (human consumption) and 
mechanisms and process for issuing import permits.  G/AG/W/161  
 
- 14 - 
 
  Answer by Thailand  
 
Currently, the importation of feed wheat requires import permits. In order to attain the permit, 
importer s are required to be a manufacturer of animal feeds and registered with the Department 
of Livestock Development, Ministry of Agriculture.  
 
In differentiating between feed wheat and wheat for consumption or other end uses Thailand has 
designated specific ta riff lines for wheat of different usage, the tariff lines are as follows:  
 HS 1001 11 00 and 1001 91 00 are seeds of wheat and meslin for planting purposes;  
 HS 1001 99 19 for human consumption; and  
 HS 1001 99 90 are other wheat which means they are used as feeds and thus import 
permits are required for imports of this tariff line.  
Thailand would like to inform that this is a temporary measure which was put in place to relieve 
the situation of market oversupply of corn, the growers of which are low income an d resource -poor 
farmers.  
 
1.14.2   Question by European Union (AG -IMS ID 83013)  
At the end of 2016, Thailand introduced a new import regime for wheat, which obliges 
importers of feed wheat to buy at least three times more maize on the local market than 
the quantity  to be imported. The government has also fixed a minimum price for maize 
at 8 Baht/kg for locally produced maize.  
 
https://ga in.fas.usda.gov/Recent%20GAIN%20Publications/Grain%20and%20Feed%20Update_Ba
ngkok_Thailand_11 -29-2016.pdf   
http://www.world -
grain.com/articles/news_home/World_Grain_News/2016/12/Restrictions_to_slow_imports_o.aspx?
ID=%7BBF6ABA78 -B13C -4E3D -8D3C -15478A689926%7D  
a. Can Thailand explain how the import measures comply with Article III:4 GATT 
and Ar ticle 2.2 TRIMS?  
b. How does Thailand intend to take into account the minimum price for maize in 
its DS:1 Domestic Support notification?  
Answer by Thailand  
 
See reply above.  
 
1.14.3   Question by United States of America (AG -IMS ID 83045)  
The United States notes that  on 19 January 2017 Thailand instituted import permits for 
the import of feed wheat. It is the United States' understanding that in order to receive 
an import permit, importers must: 1) be feed mill owners, 2) demonstrate a 3 to 1 
domestic corn absorption rate (e.g., to import one tonne of wheat, a mill will have to use 
three tonnes of domestically -produced corn), and 3) not re -sell the imported feed 
wheat.  It is also the United States' understanding the regulation was developed as a 
result of a Thai Cabine t decision in 2016, and according to the Thai Ministry of 
Commerce, the objective is to regulate wheat imports to support corn producers through 
the stabilization of corn prices. ( http://www.moc.go.th/index.php/moc -news/2015 -10-
19-04-33-08/item/88114477.html ). 
 
a. Please explain how the import permit process for feed wheat operates.  
b. Please explain how Thailand differentiates between feed wheat and wheat for 
consumpt ion or other end uses.  G/AG/W/161  
 
- 15 - 
 
  c. Please clarify whether mill owners can be located in foreign countries or must 
have a physical presence in Thailand.  
d. The structure of Thailand's wheat import regime as authorized under the Thai 
Cabinet decision in 2016 appears to req uire that the government maintain a 
balance of grains by controlling the ratio of domestically -produced corn to 
imported feed wheat used to produce feed by Thai feed mills. Please explain 
how these requirements are consistent with Thailand's WTO obligation s. Please 
explain how this regime does not afford preference to domestically -produced 
grains.   
e. Please explain why is utilization of domestically -produced corn a consideration 
in wheat import licensing.  
f. Further, Thailand's wheat import regime appears to res trict the re -sale of 
imported feed wheat. Is the internal sale and/or distribution of feed wheat, 
corn, or other products also restricted for domestic products? Please explain 
how these requirements are consistent with Thailand's WTO obligations.  
Answer by  Thailand  
 
See reply above.  
 
Follow -up: Australia reiterated the importance of these measures on wheat in view of the current 
wheat market situation. Australia noted that Thailand's attempt to differentiate imports of feed 
wheat from wheat for food by tari ff line could create a situation where products were imported 
under a tariff line designated for one end use and the end use could later change. Australia 
thanked Thailand for the bilateral discussion and looked forward to continu ing follow -up on this 
issue. Ukraine indicated interest in understanding the details of the policy and its impact on trade.  
 
1.15  Thailand's financial assistance to fruit farmers  
1.15.1   Question by United States of America (AG -IMS ID 83047)  
The United States understands the Thai Cabinet appro ved a budget of 35 billion baht 
(approximately USD 1 billion) to help small and medium -sized fruit farmers with debt 
repayment, provide new loans to improve water storage, and develop new orchards.  
 
a. Please provide additional details with regards to how thi s programme is 
implemented and how long it has existed.  
b. Does Thailand provide financial assistance in terms of credit, support 
payments, debit forgiveness, low cost interest financing for other commodities? 
If so, which crops? Please explain the scope of t he programme(s) and how they 
are implemented.  
Answer by Thailand  
 
Due to the extreme heat conditions Thailand experienced in 2016, the fruit growers suffered 
extensive damage as a result of the draught, extreme heat, and lack of water storage. In this 
regard, the government has approved a budget of 1.58 billion baht with a view to relieving the 
damage suffered by the fruit growers and to allow then to recover the produce lossed. The 
programme covers 35 provinces affected by the draught, with a total area of  328,500  Rais 
(approximately 129,878 Acres) and 95,000 farmers. The assistance given includes, amongst 
others, investment in water reservation and storage, water resource management, technical 
assistance to improve the efficiency and quality of produce, th e management of production, the 
management of water system, marketing, and logistics. The Department of Agricultural Extension 
is responsible for information gathering, assistance approval, and public relations.  
 
Follow -up: The European Union supported the  question.  
 G/AG/W/161  
 
- 16 - 
 
  1.16  U.S. Federal Milk Marketing Order (FMMO)  
1.16.1   Question by Canada (AG -IMS ID 83124)  
In the United States Federal Registrar (Vol 82, No 29 - Tuesday 14 February 2017), the 
U.S. Department of Agriculture (USDA) proposed/recommended the issuance of a 
Federal Milk Marketing Order (FMMO) to regulate the handling of milk in California.  
a. Has the USDA in the past proposed the issuance of a FMMO on a state or region, 
which previously had its own marketing order? If so, could the United States 
please identify the state or region and list the overall differences between the 
state level marketing order and the FMMO which replaced it, and elaborate on 
the reasons for the issuance of the  FMMO?  
b. Could the United States please elaborate on the factors/considerations that 
underpin the USDA proposal to issue a FMMO for California?  
c. Could the United States provide a list all the dairy producing states which are 
currently not covered by an FMMO?  
d. Is the USDA planning to propose an FMMO for those dairy producing states or 
regions which do not currently have FMMOs or to expand current FMMO 
marketing area to include those states into an existing FMMO marketing area? 
If so, could the United States describe the factors that would underpin such a 
decision?  
e. Canada understands th at after public comments on the USDA recommended 
decision for the issuance of a FMMO in California in the Federal Registrar, there 
will be a voting period by the producers affected in the California marketing 
area. Could the United States give a timeline f or when this vote will take place, 
as well as when it expects a final order being issued if producers support the 
issuance of a FMMO?  
f. Will the comments on the USDA recommended decision be available online, or 
in writing in another format? Is so, could the  United States provide a link or a 
contact to obtain this information?  
g. In regards to the FMMO proposal for California, a paper was recently released 
in February 2017 by the USDA Economic Division Titled "Regulatory Economic 
Impact Analysis of the Recommen ded California Federal Milk Marketing Order" 
(https://www.ams.usda.gov/rules -regulations/moa/dairy/ca ). The paper 
states that "the analysis finds that throughout 2017 -2025, adoption of  the 
proposed California FMMO could increase California blend prices at test, which 
would increase the California all -milk price and California milk production, in 
turn increasing California producer revenues." Related to milk production in the 
United Stat es, it has come to the U.S. attention that farmers in the United 
States Northeast Federal Marketing Order area have been disposing of an 
overabundance or surplus of milk into manure lagoons, and diverting it to be 
used as animal feed.  
i. The USDA expects tha t the issuance of an FMMO in California will increase 
the production of milk (later described as an increase in the growth in 
production). Also, there is overproduction in U.S. Northeast, which operates 
under a FMMO. Does the Unites States foresee a scenar io where California 
may be over -producing milk resulting in a surplus?  
ii. Could the United States please explain how a potential increase in growth in 
production in California would affect milk production in other areas 
throughout the United States, includin g in the Northeast FMMO?  G/AG/W/161  
 
- 17 - 
 
  iii. Could the United States please describe how a potential increase in growth 
in production in California would affect milk prices in other areas 
throughout the United States, including in the Northeast FMMO?  
h. How is the pricing for each of the California State Order milk classes (i.e. 
Class  1, Class  4a, etc.) calculated?  
The following questions are in regards to the California milk quota programme:  
 
i. Could the United States explain why California will continue to administer 
the quot a programme, which pays producers selling Class 1 milk an amount 
above the blend price, even if a FMMO is in place?  
ii. What are the changes that will be required to the administration of the 
quota programme if a FMMO is in place?  
iii. What are the reasons for no t removing the quota programme entirely, given 
that there are no quotas under other FMMOs?  
iv. Canada understands that there is also a quota programme operating in 
Virginia. How does it differ from the quota programme in California?  
Answer by United States of  America  
a. FMMO promulgation and amendatory proceedings are requested by industry 
stakeholders. Industry stakeholders can petition USDA at any time to promulgate a 
FMMO. The "Carolina FMMO " was promulgated in 1990 (56 FR 31351) and the marketing 
area was defined as the States of North Carolina and South Carolina. Before the FMMO 
was promulgated, there were state level marketing orders for both North Carolina and 
South Carolina. USDA's justification for promulgating a "Carolina FMMO " was provided 
for in the  Final Decision (55 FR 25618).  
b. Based on the evidence provided during a rulemaking hearing, USDA found that 
establishment of a "California FMMO " would provide for more orderly marketing 
conditions within the proposed marketing area. The factors/consider ations that underpin 
the recommendation are provided for in the published Recommended 
Decision  (82 FR 10634).  
c. FMMO marketing areas correspond with areas where handlers compete for sales, not the 
states where dairy is produced. Marketing area boundaries  do not necessarily fall along 
state lines. The defined marketing areas can be found in 7 CFR 1xxx.2 of each marketing 
order. A U.S. map of FMMO areas can be found here: 
https://www.ams.usda.gov/sites/default/files/media/Federal%20Milk%20Marketing%20
Orders%20Map.pdf   
d. FMMO promulgation and amendatory proceedings are requested by industry 
stakeholders. Industry stakeholders can petition USDA at any time to promulgate a 
FMMO. Other than California, currently, there are no petitions, before USDA to consider 
promulgating or expanding FMMOs. FMMOs are authorized pursuant to the Agricultural 
Marketing Agreement Act of 1937, as amended (AMAA). The stan dard outlined in the 
declared policy of the AMAA must be met for any FMMO promulgation. It states that an 
FMMO would "… establish and maintain such orderly marketing conditions for agricultural 
commodities in interstate commerce… "  
e. Public comments regar ding the proposed "California FMMO " are due 15 May 2017. At 
that time, USDA will analyze all comments received. After USDA completes this analysis, 
USDA will issue a Final Decision. Should USDA continue to recommend establishment of 
a "California FMMO, " USDA would hold a series of producer education meetings to 
discuss the proposed provisions. After such meetings, a producer referendum would be 
held. Should the Final Decision be approved by producers, USDA would issue a Final Rule 
implementing the "Californ ia FMMO. "  G/AG/W/161  
 
- 18 - 
 
  f. All comments will be made publically available at https://www.regulations.gov .  
g.  
i. The Recommended Decision Regulatory Economic Impact Analysis (REIA) estimates 
the potential economic impact of pr omulgation of a California FMMO. The REIA 
outlines an extensive list of assumptions that were made in order to conduct the 
analysis. Supply and demand equations are balanced by national market prices in the 
model.  
ii. The Recommended Decision REIA provides a written explanation of how potential 
changes in California milk production from the baseline production estimates could 
affect other areas throughout the United States.  
iii. The REIA provides a written explanation of how potential growth in California milk 
production could affect milk prices throughout the United States.  
h. An overview of the California State Order classified pricing formulas can be found in the 
Recommended Decision.  
i. The California Quota Program is a state -administered programme. Under the 
proposed California FMMO, the quota programme would remain entirely within the 
jurisdiction of the State and would be administered however deemed appropriate by 
the California Department of Food and Agriculture (CDFA). It should be noted that 
the California Quota Program does not limit production.  
ii. The administration of the California Quota Program would remain entirely in the 
purview of CDFA. Only CDFA can determine what changes, if any, would be needed 
to administer the quota programme.  
iii. The 2014 Farm Bill authorized a California FMMO, if promulgated, to "have the right 
to reblend and distribute order receipts to recognize quota value. " 
USDA's  determination of the proper recognition of the California quota programme 
can be found in the Recommended Decision.  
iv. The Virginia programme imposes requirements on handlers selling fluid milk products 
in Virginia. Like the California quota program me, the Virginia program me does not 
limit milk production by farmers.  
Follow -up: New Zealand and the European Union expresse d interest in the issue.  
 
1.17  Brazil's domestic support programmes  
1.17.1   Question by United States of America (AG -IMS ID 83038)  
In response to previous questions from the United States, Brazil stated that the Prêmio 
para Escoamento do Produto (PEP) programme was su spended for a reassessment. 
However, the United States notes that both the PEP and the Prêmio de Equalização pago 
ao Produtor  (PEPRO) programmes were reactivated in late 2016, with the maximum 
premium for wheat at recent government auctions under the PEPRO  programme set at 
.208 R$/kg.  This maximum premium equates to approximately one -third the market 
value of wheat.  
 
a. The United States, along with several other Members, has expressed concern at 
previous meetings of the CoA over the potentially trade -distort ing effects of 
PEP and PEPRO  programmes. In response to questions on these programmes, 
Brazil stated in the March  2014 CoA and in various subsequent CoA meetings 
that they remain suspended pending a reassessment of control mechanisms 
intended to prevent ir regularities. Please describe the potential irregularities 
that prompted a reassessment of PEP and PEPRO  programmes and provide the G/AG/W/161  
 
- 19 - 
 
  results of this reassessment, or explain why the reassessment was not 
completed.  
b. Recent press reports indicate that PEP and PEPRO funds are again being used 
to support industry, and that distributed funds have facilitated the export of 
significant volumes of wheat.  Additionally, publicly available Brazilian 
government data from the Companhia Nacional de Abastecimento (CONAB) an d 
the Ministry of Development, Industry and Commerce (MDIC) indicate that corn 
and wheat producers have benefited from PEP and PEPRO support 
intermittently since 2010, and particularly in 2016 and the first months of 
2017. Please explain why the programmes  are again being used, as indicated in 
Brazilian press reports.  Has Brazil modified its control mechanisms to prevent 
irregularities? Please provide more information on these controls.  
c. In light of recent press reports and without more information to fully  assess 
these program mes, it appears that exports have benefited from distributed 
funds. The United States has requested data and documentation (including 
invoices and product destinations) from Brazil at various CoA meetings, but has 
not yet been provided  with detailed information with which to make a fully 
informed assessment of PEP/PEPRO  usage. The United States requests that 
Brazil provide data on these programmes clarifying what funds are used to 
support domestic sales and what funds are used to suppor t exports.   
Answer by Brazil  
 
a. The PEP reassessment is completed. As already stated in 2015 in Brazil's reply to the 
U.S. question AG -IMS ID 77066, only the PEP programme was temporarily suspended. 
The concerns were brought up by the "Comptroller -General  of the Union " 
(Controladoria -Geral da União - CGU) in relation to whether the actual payments by the 
traders/industry to the producers were in compliance with the minimum price. The 
suspicion that payments were being made below the minimum price was not c onfirmed 
by the assessment. As noted in the response to U.S. question AG -IMS ID 76039, the PEP 
and the PEPRO programmes operate differently. The kind of compliance concerns raised 
in the PEP programme does not exist in the PEPRO because the programme does not 
involve payment to traders/commercial buyers.  
b. The programmes are currently being used to support only wheat producers as the 
market price of the product is below the minimum price set by the government. As 
stated in the previous reply, the reassess ment indicated that there were no irregularities 
regarding whether payments were being made below the minimum price. Therefore, the 
programme will continue to be administered in the same way as before.  
c. It is still not feasible to provide the kind of de tailed information requested by the U.S.  
Follow -up: The United States reiterated its call for Brazil to provide the data as requested in 
part (c) of the question and asked how Brazil managed to make payments without this data. 
Australia, Canada, New Zealan d and Ukraine echoed the U.S. request.  
 
1.18  Canada's New Milk Ingredient Class  
1.18.1   Question by Australia (AG -IMS ID 83103)  
It is Australia's understanding that a Special Milk Class Permit Program  notice, 
concerning the adoption of special Milk Class  7 by the Cana dian Milk Supply Management 
Committee  (CMSMC), was circulated by the Canadian Dairy Commission (CDC) on 
17 February 2017.  
  
a. Is this notice available publicly? If so, where? Please provide a copy.  
b. It is Australia's understanding that accompanying regulati ons and pricing 
details are being implemented by the provincial milk boards. Is this correct?  G/AG/W/161  
 
- 20 - 
 
  c. It is Australia's understanding that Class 7 will replace the current Class 4m 
created by the Canadian Milk Supply Management Committee (CMSMC) . Is this 
correct?   
d. It is Australia's understanding that Class 7 is in place in the provinces of Nova 
Scotia, New Brunswick, Prince Edward Island, Alberta, and British Columbia . Is 
this correct?  
e. It is Australia's understanding that although policy work is ongoing, those 
processes do not affect industry's ability to utilize the class, with pricing in 
place from 1 February. Is this correct?  
f. It is Australia's understanding that Class 7 is one piece of a broader "National 
Ingredients Strategy" being rolled out by the CDC. Is t his document available 
publicly? If so, where? Please provide a copy.  
g. Australia's understanding is that the CDC has conducted a due diligence review 
of the National Ingredients Strategy – is this correct?  
h. What is the role of the CDC in the implementation  of the National Ingredients 
Strategy?  
i. Can Canada provide details of the formula or formulas that will be used to  
calculate Class 7 and Ontario C lass 6 prices on a monthly basis?  
j. In the  light of the new special M ilk C lasses 6 and 7, can Canada advise wha t 
measures will be taken to ensure that its WTO volume commitment on 
subsidized exports of skim milk powder (SMP) is not breached in 2016/17 
(1 August to 31 July) or subsequent reporting years?  
k. How does Canada intend to monitor the inclusion of class 6 pr iced milk proteins 
in infant formula formulations and classes 6 and 7 for frozen pizza exports, 
given Canada's export subsidy commitments on these products?  
Answer by Canada  
 
a. This notice was sent directly to permit holders, and will not be released pub lically.  
b. Yes, this is correct. All provinces (except Newfoundland and Labrador) are currently in 
the process of implementing the new milk class, class 7, effective as of 1 February 2017, 
through their respective regulatory processes.  
c. Class 4(m) wil l be revoked once the national ingredient strategy is implemented by all 
provinces.  
d. Milk Class 7 is being implemented in all provinces.  
e. All provinces (except Newfoundland and Labrador) are currently in the process of 
implementing the new milk 7, ef fective as of 1 February 2017, through their respective 
regulatory processes.  
f. The National Ingredient Strategy stems from the agreement in principle reached 
between producers and processors in July 2016. This is a private agreement. While some 
elements  have been adopted and are being implemented by provincial milk marketing 
boards, other elements continue to be under discussion.  
g. No, the Canadian Dairy Commission has conducted a due diligence review of some 
elements of the National Ingredients Strate gy. These are the audit risk associated to the 
implementation of class 7, along with the new prici ng formula regarding Milk Class  1 
to 4. The CDC did not consider other elements of the National Ingredients Strategy.  G/AG/W/161  
 
- 21 - 
 
  h. The Canadian Dairy Commission will p lay a role in administering Milk Class  7 similar to 
the role it plays for other milk classes. Just like it does for other classes, the Canadian 
Dairy Commission will perform revenue pooling calculations and ensure provinces are in 
compliance with national audit standards.  
i. Both Milk Class  7 and Ontario Milk Class  6 are based on world prices. The prices for Milk 
Class 7 are available on the website: http://www.milkingredients.ca/ .  
j. Goods produced under th ese classes, or any Milk Class  other than Milk Class  5(d), can be 
sold by any eligible processor on the domestic or export markets. As such, they do not 
require export permits, nor are they contingent upon export. Therefore, Canada would 
not be reporting a ny exports except those under Milk Class  5(d) in its export subsidy 
notifications. Canada understands that Milk Class  6 will be revoked upon full 
implementation of Milk Class  7 in Ontario.  
k. Canada does not have export subsidy commitments for frozen pizz a and infant formula. 
Canada is not required to monitor the inclusion of dairy components for use in these 
further processed products for export subsidy purposes. Therefore, exports will not be 
reported in Canada's export subsidy notification.  
Follow -up: The United States expressed interest the question.  
1.18.2   Question by European Union (AG -IMS ID 83008)  
In its replies to questions from Members on the new milk ingredient classes, Canada 
stated that "the decision to create a dairy ingredient strategy was industry -driven; the 
government of Canada was not party to the negotiations". However, the new Canadian 
dairy ingredient strategy, according to which the butterfat price from classes 1 to 4 was 
increased, is solely based on government - imposed production quotas an d the support 
prices at which the Canadian Dairy Commission purchases and sells butter and SMP 
within the framework of its programmes.  
 
Could Canada therefore clarify whether the increased butterfat price from classes 1 to 4 
affect the administered price used for the purpose of calculating market price support 
for butter in the DS:1  notification?  
 
Answer by Canada  
 
Support prices are the prices at which the Canadian Dairy Commission purchases and sells butter, 
and skim milk powder within the framework of i ts various program mes. Butterfat prices under Milk 
Classes 1-4 are not increased under the National Ingredient Strategy. In fact, the overall prices for 
these classes decreased on 1 February 2017.  
 
Follow -up: The United States expressed interest the quest ion. 
1.18.3   Question by New Zealand (AG -IMS ID 83002)  
On 17 February 2017, the Canadian Dairy Commission published a notification informing 
"Distributors and Processors" that "[Milk] Class 7 was adopted by the CMSMC in 
January  2017 following an agreement in princ iple between producers and processors 
that occurred in July 2016", and providing information on transitional measures. Around 
the same time, on 1st February, the British Columbia Milk Marketing Board notified 
industry of the implementation of an "agreement  in principle" by producers and 
processors on a "National Ingredients Strategy", which was "approved by the ten 
provinces on 29 July 2016 and by the CDC on 20 January 2017. The Notice details 
"decisions….made by ten provinces under CDC's guidance. These de cisions mapped the 
intent of the National Ingredients Strategy and allowed the "agreement in principle" to 
develop into a practical plan for implementation".  
  
a. Can Canada confirm whether the ingredients strategy will be made publically 
available, and if s o, when?  G/AG/W/161  
 
- 22 - 
 
  b. The CDC notification states that "Class 7 prices will be calculated each month. 
They will be retroactive; for example, February 2017 prices will be calculated in 
early March."  
i. Can Canada provide details on how prices will be set, including what 
baseline is used, how frequently the baseline is updated, and the 
relationship between Class 7 prices and world market prices?  
ii. Can Canada confirm the milk prices that were set on 1 February?  
iii. Can Canada please confirm whether prices for this class will be  set based on 
the lowest world market prices?  
iv. For the purposes of setting the price of the new 'ingredient' milk class, can 
Canada please provide further information on how the 'lowest world market 
price' will be calculated?  
c. Can Canada advise what steps the CDC has taken, or will take, in relation to 
implementation of the National Ingredients Strategy?  
d. New Zealand understands that the CDC conducts cost of production studies for 
dairy products as part of its administration of Canada's dairy supply 
managem ent system. Can Canada please provide the results of these studies as 
they relate to the new Class  7, including whether the set price of the new milk 
class would be significantly below the average cost of production for Canadian 
dairy farmers, and by what approximate amount?  
e. Can Canada confirm whether a permit will be required for processors to export 
product under Class 7 or for products that incorporate Class 7 priced milk? Will 
Canada notify these exports to the WTO in its Export Subsidy notification?  
f. Can Canada confirm whether Class 7 now replaces Ontario's Class 6, as well as 
other equivalent milk classes adopted in other provincial schemes?  
g. Can Canada confirm whether the Record of Decisions made by the Milk Pool 
Coordinating Committee, or by the Can ada Milk Supply Management 
Committee, related to the ingredients strategy, will be made publically 
available?  
h. h. Can Canada confirm if any of the other milk classes will be discontinued, with 
Class  7 effectively replacing them, and if so, which milk class es will be 
discontinued?  
i. Can Canada confirm if the CDC's buy -back programme for skim milk powder 
(SMP) has been used since 1 February 2017, and what date it will cease to 
operate?  
Answer by Canada  
 
a. The National Ingredient Strategy stems from the agree ment in principle reached 
between producers and processors in July 2016. This is a private agreement. While some 
elements have been adopted and are being implemented by provincial milk marketing 
boards, other elements continue to be under discussion. A sin gle document is not 
expected to be released publically.  
b. The prices under Milk Class  7 for butterfat, protein and other solids are determined 
based on world prices and will be calculated on a monthly basis. The prices for Milk Class  
7 are available on t he website: http://www.milkingredients.ca .  
c. The Canadian Dairy Commission will play a role in administering milk class 7 similar to 
the role it plays for other milk classes. Just like it does for other clas ses, the Canadian G/AG/W/161  
 
- 23 - 
 
  Dairy Commission will perform revenue pooling calculations and ensure provinces are in 
compliance with national audit standards.  
d. The prices under Milk Class  7 for butterfat, protein and other solids are determined 
based on world price s. It does not use the cost of production. The cost of production 
survey using 2017 survey data will not be released until 2018. The latest cost of 
production survey using 2015 survey data was released in July 2016 and is available at 
the following website : http://www.cdc -ccl.gc.ca .  
e. Goods produced under these classes, or any milk class other than Milk Class  5(d), can be 
sold by any eligible processor on the domestic or export markets. As such, they do not 
requir e export permits, nor are they contingent upon export. Therefore, Canada would 
not be reporting any exports except those under Milk Class  5(d) in its export subsidy 
notifications.  
f. Canada understands that Milk Class  6 will be revoked upon full implement ation of Milk 
Class 7 in Ontario.  
g. The Joint P5 Supervisory Body/Western Milk Pool Coordinating Committee and the 
Canadian Milk Supply Management Committee (CMSMC) are not public forums. As such, 
the Records of Decision for these bodies will not be made  available publically.  
h. Pending the full implementation of the national ingredient strategy in all provinces, Milk 
Class 4(a)1 and class 4(m) will be revoked.  
i. The Canadian Dairy Commission has suspended purchases of skim milk powder under 
plan B of the Domestic Seasonality Program as of 1 February 2017, until further notice.  
Follow -up: The United States expressed interest the question.  
1.18.4   Question by New Zealand (AG -IMS ID 83054)  
In reporting how Canada meets its WTO export subsidy commitments, the 2015 /16 
Canadian Dairy Commission (CDC) Annual report states that in the "2015 -2016 dairy 
year, dairy products were exported by the CDC as well as exporting companies who 
were issued Class 5(d) export permits". During this period, the CDC reports that 
"Canada exported 11,321 tonnes of skim milk powder" which received 
CAD 30.920  million in export subsidies. However, according to Global Trade Atlas, 
Canada exported 16,218 tonnes of skim milk powder, a discrepancy of 4,897 tonnes.  
 
a. Can Canada explain this discrep ancy in the exports it reports through the CDC?  
b. How does Canada recon cile these additional exports ( 43% of the volume 
reported by the CDC ) with its export subsidy commitments which limits export 
subsidies at CAD31.149 million?  
c. Are producers able to expor t skim milk powder without a Class 5(d) export 
permit, and if so, how does Canada ensure that these products are not the 
recipients of export subsidies at the provincial level?  
Answer by Canada  
 
a. The export statistics of 16,218 tonnes of skim milk powde r from Global Trade Atlas come 
from Statistics Canada and do not reflect the actual exports of skim milk powder using 
5(d) permits, as reflected by the Canadian Dairy Commission statistics.  
b. Canada uses the data reported by the Canadian Dairy Commission  for its export 
subsidies under its export subsidy notification. The exports statistics listed by the 
Canadian Dairy Commission in its annual report in tonnes of skim milk powder are 
correct and will be reported in the upcoming 2015/16 export subsidy notif ication for 
Canada.  G/AG/W/161  
 
- 24 - 
 
  c. Processors are able to export any dairy product without a 5(d) permit; however, it does 
not benefit from export subsidies.  
Follow -up: The United States expressed interest the question.  
1.18.5   Question by New Zealand and United States of Am erica (AG -IMS ID 83134 and 
AG-IMS ID 83039)  
Producer/Processor Agreement and Milk Class 7  
 
a. The Special Milk Class Permit Program  notice, published by the Canadian Dairy 
Commission  (CDC) on 17 February 2017, confirms that there was an agreement 
in principle  between producers and processors reached in July 2016 regarding 
a new milk class (Class 7). Is this agreement available publically? If so, where? 
Please provide a copy.  
b. The United States understands from the Special  Milk Class  Permit  Program  
notice, publi shed by the CDC on 17 February 2017, that rules for the Class  7 
eligibility of whole milk powder are yet to be established.  
i. When and how will they be established?   
ii. Where will this information be made public?  
c. The Special  Milk Class  Permit  Program  notice, pu blished by the CDC on 
17 February  2017, states that "[t]he  prices that processors pay in C lass 7 are 
similar to class 5(c) prices and lower than class 5(b) prices".  
i. Please clarify exactly how the prices for each dairy 
component/ingredient/product in Class 7 are calculated.  
ii. Are decreases in proceeds from sales of the dairy components/ingredients 
products being offset by increases in butterfat prices or other means?  
d. Are there any federal, provincial, or other documents that implement Class 7 or 
provide detail s related to implementation?  If so, are they publically 
available?  If so, where?  
e. What is the status of Class 7 implementation in each province?  
f. What is the role of the provincial milk marketing boards, the CDC, and the 
Canadian Milk Supply Management Commi ttee (CMSMC) in the adoption and 
implementation of Class  7?  
g. What are the eligibility requirements for Class 7, including:  
i. dairy components/ingredients/products in Class 7 and the products they 
can be used to manufacture;  
ii. whether a certain level of dairy c omponents/ingredients/products in 
Class  7 must be used to be eligible for Class 7;  
iii. impact of use of imported dairy components/ingredients/products on 
eligibility Class  7; and  
iv. information and reporting required of processors.  
h. When and where will administrat ive procedures, including how Class 7 prices 
are implemented (e.g., billing mechanisms), and audited be publically 
available?  G/AG/W/161  
 
- 25 - 
 
  i. What are processors allowed to do with unused dairy 
components/ingredients/products? For example, if a processor receives certain 
milk components under Class 7 to manufacture products, but does not use all 
components, what may a processor do with the unused components?  Please 
explain if these dairy components/ingredients/products can be exported, and 
how will such exports be reported ? 
j. Will products manufactured using dairy components/ingredients/products in 
Class 7 be allowed to be exported and will such exports be reported in Canada's 
WTO Export Subsidy notification?  
k. Alberta's and British Columbia's milk marketing board directives is sued 
documents on Class 7 on 31 January and 1 February respectively. The Alberta 
document specifies that "Processors using less fresh milk protein than specified 
by the protein dairy product billing ratios specified for each Class (See 
Appendix A) will be subject to a price adjustment on that lessor amount at the 
difference between the higher class component prices and the ingredients class 
component prices". The British Columbia document specifies, "Processors using 
less fresh milk protein than specified b y the protein dairy product billing ratios 
specified for each Class in Schedule 4.1 will be subject to a price adjustment 
and billed in the corresponding end use class".  
Will a processor who uses both domestic and imported dairy 
components/ingredients/ pr oducts, and who uses imported ultra -filtered milk 
to meet the minimum percentage of casein content derived from fluid milk in 
the compositional cheese requirements, be able to qualify to receive all the 
domestic dairy components/ingredients/ products under Class  7 at Class  7 
prices?  
l. Paragraph 13 of the Alberta directive states "Transactions between companies 
involving Class 7 ingredients in liquid form (e.g., skim milk, MPC, MPI) are 
concluded at the domestic market price; the Class 7 price applies upon fina l 
utilization under HBM parameters, with the exception of: a. In the case of 
registered food/further processors liquid milk in gredients can be bought at the 
Class 7 price for purchase of 1000 liters and less (totes) per transaction, up to 
10,000 litres per  month; b. In the case of exports, liquid mil k ingredients may 
be billed at C lass 7."  
i. What is "domestic market price"?  
ii. Does this mean that a registered food/further processor would be limited to 
buying 10,000 liters per month of liquid milk ingredients at  Class 7 price, 
but there would not be a limit on Class 7 liquid milk ingredients if it was 
being exported?  If so, what is the policy justification?  
m. Paragraph 14 of the Alberta directive sta tes "Liquid ingredients at the C lass 7 
price cannot be bought or s old through a third party, except for exports".  What 
is the policy justification for this?  
n. Does Class 7 contain dairy product protein price references that are identical or 
similar to those in Ontario Class 6?  
o. Does Class 4(m) continue, or is it superseded  by or incorporated into Class 7?  
Ontario Class 6  
 
p. Does Ontario Class 6 continue, or is it superseded by or incorporated into 
Class  7? 
q. Under Schedule 3: Dairy Products Protein Pricing Reference of the DFO Pricing 
Regulation 05/16, Milk Act, R.S.O. 1990, Ch apter M -12, as amended, would a G/AG/W/161  
 
- 26 - 
 
  processor who uses both imported and domestic fluid milk to meet the 
applicable "Dairy Product Protein Pricing Reference" t hreshold (for example, 
95% for C lass 3(c) Gouda) qualify for Class  6 pricing for the use of Class  6 
ingredients in that product?  
r. What are processors allowed to do with unused dairy 
components/ingredients/products?  For example, if a processor receives certain 
milk components under Class 6 to manufacture products, but does not use all 
components, what may a  processor do with the unused components?  Can these 
dairy components/ingredients/products be exported, and how will such 
exports be reported?  
s. Are products manufactured using dairy components/ingredients/products in 
Class  6 allowed to be exported and will s uch exports be reported in Canada's 
WTO Export Subsidy notification?  
Other  
 
t. Canada stated in its answer to AG -IMS ID 82001 that: "Under its Domestic 
Seasonality Programs, the Canadian Dairy Commission buys butter and skim 
milk powder from processors at est ablished support prices."  
Is there a limit on the amount of butter or skim milk powder that can be 
purchased through the Domestic Seasonality Program?  
u. On 10 November 2016, the government of Canada announced that it would 
invest $350 million in two new prog rammes: the Dairy Farm Investment 
Program and the Dairy Processing Investment Fund. The United States 
understands from an update on the AAFC website 
(http://www.agr.gc.ca/eng/about -us/public -opinion -and-
consultations/investing -in-the-dairy -sector -programs -to-support -the-sector -
in-anticipation -of-canada -european -union -trade -
agreement/?id=1463512890911 ) that consultations on this programme closed 
on 15 December 2016 and that, at that time, the programme was expected to 
be finalized in the "coming months."  
i. Are there any updates on finalization o r implementation of these 
program mes? 
ii. When and how does Canada plan to notify these program mes to the 
Committee on Agriculture?  
Answer by Canada  
 
a. The agreement in principle between producers and processors in July 2016 is a private 
agreement. While some  elements have been adopted and are being implemented by 
provincial milk marketing boards, other elements continue to be under discussion.  
b. The rules for whole milk powder are subject to discussions amongst industry 
stakeholders. When and where this inf ormation will be made public is to be determined.  
c.  
i. The pric es for M ilk C lass 7 are available on the website: 
http://www.milkingredients.ca . The prices for butterfat, protein and other solids are 
determined  based on world prices on a monthly basis.  
ii. No, they are not.  G/AG/W/161  
 
- 27 - 
 
  d. The provincial milk marketing boards are currently in th e process of implementing Milk 
Class 7 through their respective regulatory processes. Some of these processes are 
currently available publically on provincial government websites.  
e. All provinces (except Newfoundland and Labrador) are currently in the process of 
implementing the new milk class, C lass 7, effective as of 1 February 2017, through their 
respective regulatory processes.  
f. This CMSMC serves as a key national body for policy development and discussions 
respecting the dairy production and processing sectors. Provincial milk marketing boards 
are in the process of implementing C lass 7 through their respective provincial process es. 
The Canadian Dairy Commission will play a role in administe ring M ilk Class 7 similar to 
the role it plays for other milk classes. Just like it does for other classes, the Canadian 
Dairy Commission will perform revenue pooling calculations, and ensure p rovinces are in 
compliance with national audit standards.  
g. 
i. Class 7 is intended to be used to manufacture dairy ingredients such as skim milk 
powder or milk protein concentrates. A full list of the eligible products will be posted 
on the Canadian Dairy C ommission website.  
ii. No, there is no minimum level of compon ents needed to be eligible for C lass 7.  
iii. The eligibility f or a processor to be billed at M ilk Class 7 prices is not determined by 
the source, either imported or domestic, of dairy ingredients. The amount of protein 
that can be invoiced at the milk Class 7 price varies depending on the product that is 
being processed (e.g.,  cheese, yogurt, ice cream).  
iv. Processors are required to report their use of milk to provincial milk marketing 
boards, which then  bill processors accordingly.  
h. This information will be made available through provincial milk marketing boards and the 
Canadian Dairy Commission once it is complete and in effect.  
i. Processors report their use of milk to provincial milk marketing boa rds, which then bill 
processors accordingly. The use of milk and milk components by processors is billed on a 
retroactive basis, therefore there is no such thing as unused components. Processors can 
use Milk Class 7 ingredients for processing other dairy p roducts, or sell them on the 
marketplace. The eligibility for p rocessors to be billed under C lass 7 is not contingent 
upon export. Therefore, exports would not be reported.  
j. The eligibility for processors to be billed under Class 7 is not contingent upo n export. 
Therefore, Canada will not be reporting any exports except those under Milk Class 5(d) 
in its export subsidy notifications.  
k. Canada would like to re -iterate that milk prices are administered by provincial milk 
marketing boards. They are admini stered independently from Canadian regulations on 
cheese compositional standards. The eligibility for a processor to be billed at Milk C lass 7 
prices is not determined by the source, either imported or domestic, of dairy ingredients.  
l. 
i. The domestic market  price refers to milk class pricing for classes 1 -4.  
ii. Canada understands that industry discussions on the future parameters for 
transactions between milk buyers involving class 7 ingredients in liquid form are not 
yet concluded.  
m. Canada understands that industry discussions on the future parameters for transactions 
between milk buyers involving class 7 ingredients in liquid form are not yet concluded.  G/AG/W/161  
 
- 28 - 
 
  n. No, certain elements are different as a result of discussions between producers and 
processors; howev er, both Milk Class 7 and Ontario Milk Class 6 are based on world 
prices.  
o. Milk class 4(m) will be revoked once Milk Class 7 is implemented by all provinces.  
p. Canada understands that Milk C lass 6 will be revoked upon full implementation of Milk 
Class 7 in Ontario.  
q. Canada understands that Milk C lass 6 will be revoked upon full implementation of Milk 
Class 7 in Ontario.  
r. Canada understands that Milk Class 6 will be revoked upon full implementation of Milk 
Class 7 in Ontario.  
s. Canada understands  that Milk Class  6 will be revoked upon full implementation of Milk 
Class 7 in Ontario.  
t. There are no limits on the amount of butter or skim milk powder that can be purchased 
through the Domestic Seasonality Program.  
u.  
i. The government of Canada is cur rently working to finalize the programmes based on 
feedback received during stakeholder consultations. The goal is to have the 
programs in place when CETA is provisionally applied.  
ii. Canada will continue to notify its domestic support program mes under its d omestic 
support notification for the appropriate year.  
Follow -up: Australia supported the questions from the European Union, New Zealand and the 
United States . Australia  encouraged the government of Canada and its relevant bodies to be more 
transparent in  implementing these new arrangements. Given the heavy involvement of the 
Canadian Dairy Commission , Australia was disappointed with Canada's statement that the 
ingredient strategy arrangements were private. New Zealand supported Australia's question and 
its follow -up comments. New Zealand reiterated its request for information  (AG-IMS ID 83008 ) 
that Canada had not  provide d since, at the time,  the agreement between the farmers and 
processers  had not been  finalized. New Zealand again asked Canada to share a f ull copy of this 
agreement. The European Union noted the importance of its dairy sector and registered interest in 
all WTO Members' dairy policies. The United States and Ukraine expressed interest the question .  
 
1.19  Canada's wine sale policy  
1.19.1   Question by Austr alia (AG -IMS ID 83104)  
Given the high number and variation in restrictions on the sale of wine in Quebec, British 
Columbia  (BC), Nova Scotia and Ontario:  
 
a. What is the federal government doing to ensure that restrictions across its 
provinces do not discrim inate between domestic and imported product?  
b. Has any analysis been undertaken looking at the effect of these restrictions on 
imported products? For example, Quebec is now implementing a non -
transparent "variable markup" pricing system which creates an inc entive to 
select products based solely on price and disregard product quality and 
consumer preferences. Historically, Quebec applied these mark -ups in a 
relatively transparent, objective and predictable manner, which provided 
certainty to suppliers and enc ouraged competition in product quality and 
consumer value. As with Nova Scotia and Ontario, Quebec's new arbitrary and 
discretionary mark -up policy is inconsistent with what Canada indicated in its G/AG/W/161  
 
- 29 - 
 
  2012 World Trade Organization (WTO) State Trading Enterpri se notification as 
the way consumer prices are constructed.  
c. Has the federal government provided Quebec with advice on the WTO 
consistency or otherwise of this specific measure?  
d. If not, will the federal government seek an explanation from Quebec?  
e. Will Ca nada update their STE notification, to notify the changes to the way 
consumer prices are constructed?  
Answer by Canada  
 
a. As per the Canadian Importation of Intoxicating Liquors Act, the responsibility for wine 
importation, distribution and sales of alco hol is the sole responsibility of the provinces. 
The government of Canada works closely with all provinces and territories to help ensure 
consistency of liquor distribution policies with Canada's international trade obligations. 
This includes engaging with  provinces and territories at all levels through the regulatory 
development and implementation process. It also includes conveying trading partner 
concerns related to the issues that have been raised. Canada has also facilitated 
meetings on this subject in volving foreign governments and industry associations in an 
effort to increase transparency and understanding of provincial liquor distribution 
policies.  
b. to e. For clarification, Quebec has not introduced a variable mark -up. Canada does not 
consider th at an update to Canada's WTO State Trading Enterprises notification is 
required as there has been no change.  
1.19.2   Question by European Union (AG -IMS ID 83007)  
Canadian regional Ontario Regulation 232/16 allows authorized grocery stores to sell 
both domestic an d foreign wine with specific requirements that will help all small 
producers compete. However, paragraph 25(2)2.iii. of the Regulation states that "at 
least 50% of the containers of wine (excluding cider) on display in the store must 
contain wine that is p roduced using grapes from a single country and that the country 
where the grapes were grown produces, in the aggregate, less than 150 million litres of 
wine annually from grapes grown in that country."  
 
a. Could Canada specify what is the legitimate objective  of such a requirement?  
b. Canada claims that it would aim at helping all small producers compete, 
however small producer's competitiveness has little, if at all, to do with the 
wine production volume of the country where the grapes of were grown. There 
are small producers in large wine producing countries and large producers in 
small wine producing countries. In the light of that, how would Canada see this 
provision complying with Article III:1 GATT as regards different sale 
requirements applied to imported and domestic products?  
Answer by Canada  
 
Ontario Regulation 232/16 permits the sale of both imported and domestic wine in Ontario grocery 
stores with specific requirements to support access for small producers from around the world. 
Canada notes that the d escription of the Ontario regulations in this question does not illustrate the 
full range of options for suppliers wanting to access the grocery store channel. Article 25(2)2 of 
the regulation, referred to in the question, sets out shelf space requirements  for unrestricted 
licenses. Under these criteria, at least 10% of shelf space must contain wine manufactured by 
small wineries. At least 50% of shelf space must contain wine that is produced using grapes from a 
single country and which satisfies at least o ne of the following criteria:  
 
 the wine is quality assurance wine;  
 the wine is produced by a small winery; or  G/AG/W/161  
 
- 30 - 
 
   the country where the grapes are grown produces, in the aggregate, less than 150M  L of 
wine annually from grapes grown in that country. The rem aining 50% of shelf space may 
contain wine from any size of producer from anywhere in the world.  
1.19.3   Question by New Zealand and United States of America (AG -IMS ID 83135 and 
AG-IMS ID 83041)  
Ontario  
 
a. Please clarify if imported and domestic Vintages products a re allowed to be 
sold through grocery store channels. If domestic products are allowed but 
imported products are not, what is the justification?  
b. What is the status of consideration of flexible mark -ups, and what are next 
steps?  
Quebec  
 
c. Please confirm that  Quebec small -scale producers are able to sell directly to 
grocery stores, bypassing the liquor board  (and thereby liquor board 
mark -ups)?  
Answer by Canada  
 
a. Imported wines listed in the LCBO General List are eligible for sale in grocery stores. 
Canada i s consulting with Ontario on this question for further information.  
b. On 20 June, the Liquor Control Board of Ontario (LCBO) launched a pilot competitive 
tendering process with a variable mark -up component. On 11 July, the LCBO issued a 
letter extending the deadline for receiving tenders but did not set a new deadline. The 
process has been suspended until further notice from the LCBO and submissions are not 
being considered as the LCBO explores potential options on how to proceed.  
c. The Quebec Act Respe cting the Société des alcools du Québec, Division III sets out the 
various permits required for the making and distribution of alcoholic beverages in 
Quebec, including for small -scale producers.  
Follow -up: Concerning question AG -IMS ID 83007, Australia not ed that it had raised a similar 
question in the past concerning the definition of small wineries. Australia noted that Canada's 
policy prevented wine exports from small and boutique wineries such as those in the Canberra 
region. New Zealand noted interest in this topic.  
 
1.20  Canada's tariff -rate quota for cheese  
1.20.1   Question by New Zealand, Norway and Switzerland (AG -IMS ID 83003, AG -IMS 
ID 83005 and AG -IMS ID 83004)  
As noted in New Zealand's previous question to Canada at the 81st Committee on 
Agriculture (AG -IMS ID 81004), New Zealand is concerned about proposed changes to 
Canada's WTO  20,411,866 kg tariff quota for cheese as part of the Comprehensive 
Economic Trade Agreement (CETA) between Canada and the European Union (EU).  
 
a. Can Canada please confirm which WTO  Members it has consulted with, and 
received agreement from, for the realloca tion of 800 tonnes from the 
non-EU reserve of the WTO quota? As part of the implementation process, New 
Zealand understands that Canada has asked importers around their preference s 
for the surrender of access rights under the non -EU reserve.  
b. Does Canada intend to undertake similar consultation with WTO Member 
governments?  G/AG/W/161  
 
- 31 - 
 
  c. Can Canada provide an update on this process, including when affected 
Members and importers can expect a deci sion to be announced?  
Answer by Canada  
 
The adjustment to the European Union reserve under Canada's WTO cheese tariff rate quota  (TRQ) 
is a shift to maintain the relative shares of cheese TRQ quota between EU and non -EU 
WTO Members due to EU enlargement. The size of the WTO cheese TRQ will remain at 
20,411,866  kilograms and Canada will continue to administer this quota under the Export and 
Import Permits Act and in conformity with its WTO obligations. Canada engaged existing allocation 
holders in order to identify those entities that wish to transfer some, or all, of their allocation from 
the non -EU to the EU reserve of the global TRQ. This consultative process identified sufficient 
volumes to address the 800,000 kg commitment. Global Affairs Canada, the de partment 
responsible for the administration of the TRQ, has advised those entities that the transfers will 
proceed after the coming into force of the relevant domestic CETA implementing legislation. As per 
established WTO practices regarding changes to the  administration of a TRQ, Canada will submit a 
notification to the WTO Committee on Agriculture to inform WTO Members of the transfer of 
800,000  kilograms.  
 
Follow -up: New Zealand remained concerned that the proposed changes to Canada's WTO tariff 
quota fo r cheese would be inconsistent with Canada's commitments under the WTO, including its 
MFN obligations. New Zealand invited Canada to provide further information concerning the quota 
reallocation. Norway noted that the consultation process with importers ex plained by Canada did 
not address the concern of other WTO exporting Members. Norway reiterated that, according to 
figures from Statistics Canada, recent historic imports of cheese from the 13 new EU member 
states joining after 2004 were less than 300 tonn es per year. In Norway's view, this would mean 
that Canada, as per the bilateral agreement CITA, had offered the European Union an excess of 
500 tonnes of cheese quota at the expense of other WTO Members. Norway raised two follow -up 
questions: "(1) Could C anada confirm the new MA:1 notification will include figures of historic 
imports from the 13 new EU member states; and (2) According to Norway's understanding the 
CITA agreement has been signed but has not entered into force. What is the intended 
implement ation date for the increase of the 800 tonnes of quota for the European Union?" 
Switzerland supported New Zealand and Norway's interventions, particularly Norway's request for 
historic trade figures. The United States supported Norway's follow -up questions .  
 
1.21  Canada's market price support for dairy products  
1.21.1   Question by New Zealand (AG -IMS ID 83001)  
In response to New Zealand's question to Canada at the 82nd Committee on Agriculture 
(AG-IMS ID 82058) on domestic support, Canada responded that it only reports  support 
prices for two products to which an administered price applies i.e. butter and skim milk 
powder (SMP). Canada did not address the part of the question that asked why Canada 
does not include market price support provided at the Provincial level. No ting that 
Annex 3, Article 3 of the Agreement on Agriculture specifically includes national and 
sub-national support within Members' AMS calculation, can Canada explain why it does 
not include market price support provided at the Provincial -level given tha t all milk 
produced in Canada, with the exception of that exported under export subsidy 
commitments or sold as animal feed, receives the benefit of supported domestic prices?  
 
Answer by Canada  
 
In its domestic support notifications, Canada reports market price support for only two products to 
which an administered price applies (support price): i.e., butter and skim milk powder. There are 
no additional administered prices at the federal or provincial level.  
 
Follow -up: New Zealand flagged interest in how C anada reported its domestic support policies, 
particularly in light of its future reporting which would take into account the National Ingredient 
Strategy and the newly subsidized milk classes that Canada would introduce. New Zealand looked 
forward to moni toring this topic.  
 G/AG/W/161  
 
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  1.22  India's minimum support price for Kharif crops  
1.22.1   Question by Canada and the United States of America (AG -IMS ID 83123 and 
AG-IMS ID 83043)  
In response to AG -IMS ID 82005, India confirmed the primary objective of the minimum 
support price  (MSP) of pulses and oilseeds is to increase production so that domestic 
supply can better meet demand as well as other considerations.  In the same response, 
India noted that the Cabinet Committee on Economic Affairs (CCEA) also stated the need 
to incentiv ize production not only because of the gap between domestic supply and 
domestic demand, but also increased imports.   
 
a. Given that India has stated it set MSPs at levels intended to incentivize 
production by producers, please explain how the MSP programme do es not 
confer a benefit to producers.  Please explain how India plans to notify the 
programme?  
b. Please confirm, as stated by the CCEA, that a purpose of the MSP programme is 
to minimize imports of pulses and oilseeds. Furthermore, are decreased imports 
the aim of MSP programmes for other commodities in India?  
Answer by India  
 
Minimum Support Price (MSP) programme is formulated with the objective to safeguard farmers 
from distress sales and to procure food grains for public distribution. Pulses are important s ource 
of protein in India and essential for food and livelihood security. Such support is notified by India 
in its Domestic Support Notification, as required.  
 
Follow -up: The United States noted that India did n ot directly answer the question . Canada also  
reserved the right to raise follow -up questions. The European Union looked forward to India's new 
notification relating to this measure.  
 
1.23  India's importation of apples  
1.23.1   Question by New Zealand (AG -IMS ID 83056)  
New Zealand has been informed that the port s of Visakhapatnam and Tuticorin continue 
to be closed to apple imports. These ports have been closed since September 2015.  
 
a. Can India provide New Zealand with an update on the rationale for the 
continued closure of these ports to imports of apples, inclu ding whether the 
closure is due to SPS  concerns?  
b. Now that 18 months has passed since the ports were initially closed, is India 
able to advise when we can expect to see the ports reopen to apple imports?  
c. Can India provide an indication of when it intends to notify the WTO of these 
closures?  
d. How are these closures consistent with Article 4.2 of the Agreement on 
Agriculture which states that "Members shall not maintain, resort to, or revert 
to any measures of the kind which have been required to be converte d into 
ordinary customs duties"?  
Answer by India  
 
As India has stated in the previous meetings of CoA, the issue is beyond the purview of the WTO 
Agreement on Agriculture. India has responded on this issue in other WTO Committees.  
 
Follow -up: New Zealand voiced disappointment with India's response and questioned where would 
be the suitable venue for raising this matter given that the Agriculture, SPS and TBT  Committee s G/AG/W/161  
 
- 33 - 
 
  were not the appropriate for a. The European Union and the United States shared New Zeala nd's 
view on this issue.   
 
1.24  India's sugar export subsidies  
1.24.1   Question by Australia (AG -IMS ID 83105)  
Australia thanks India for answers provided to Australia's questions on the Minimum 
Indicative Export Quota Scheme raised at the 82nd Committee on Agriculture  
(AG-IMS ID 82024). In India's response to question (e), it said that 1.67 million MT of 
sugar had been exported up until 19 May 2016  "the date on which the scheme was 
withdrawn ". In relation to the withdrawal of this scheme, what replacement measures 
have  been put in place, including any production subsidies?  
  
Australia notes India's most recent export subsidy notification for implementation years 
2004 -09 was lodged in 2012. Australia looks forward to reviewing a more recent 
notification when it becomes available.  
 
Answer by India  
 
No replacement measures have been put in place after withdrawal of the above scheme. India will 
be submitting its export subsidies notifications in due course.  
 
Follow -up: Brazil noted interest in this issue. The European Uni on looked forward to reviewing 
India's notification on export subsidies.  
 
1.25  India's wheat stocks and exports  
1.25.1   Question by United States of America (AG -IMS ID 83042)  
In AG -IMS ID 74048 and repeated below, the United States details the estimated 
handling and t ransport costs of the wheat India exported from government -held stocks 
procured under its market price support program me in 2013. India responded that 
because the tender process was on -going, other details of the cost cannot be provided 
because of commerci al consideration.  Now that the tender process is complete, please 
confirm the accuracy of the U.S. estimate.  
 
Furthermore, while question AG -IMS ID 74048 concerned wheat exported in 2013, India 
indicated in response to a question from Australia in the STC Committee (16 -2318) that 
in 2014/15 an additional 3.2 million ton nes of wheat were exported from government 
stocks. Please provide the information related to those exports, including any subsidy 
afforded.  
 
The United States has calculated the cost to the g overnment of India of exported wheat 
as follows, using information provided by India and applying it to a delivery from Karnal, 
Haryana, to Kandla port as an example. The United States has also used the following 
information derived from "Report of the Com ptroller and Auditor General of India on 
Storage Management and Movement of Food Grains in Food Corporation of India, Report 
No 7 of 2013"[1]. 
  
"Statutory charges include mandi charges (Market fee, Dami/Arhatia Commission, 
Rural Development Cess, Auction fee), purchase/trade tax and gunny costs. Statutory 
charges (except gunny cost) are levied by the State Gove rnments as a fixed 
percentage of the MSP. Non -statutory charges include mandi labour, transportation 
costs, driage losses, custody and maintenance charges , interest and milling 
charges,  etc. 
Mandi labour charges ranged from rupees 9.47 per quintal to rupee s 14.09 per quintal 
in respect of wheat in major procuring states (Punjab, Haryana, UP and MP) during 
the period 2006 -07 to 2011 -12. G/AG/W/161  
 
- 34 - 
 
  Transportation and handling charges ranged from rupees 11.83 per quintal to rupees 
27.98 per quintal in respect of wheat in  major procur ing states (Punjab, Haryana, 
UP and MP) during the period 2006 -07 to 2011 -12.These charges, however, ranged 
from rupees 11.56 per quintal to rupees 17.97 per quintal in respect of Rajasthan 
during the same period."  
Table 1: Estimates for deliv ery of Haryana 2013 crop wheat to Kandla port in 50 -car unit 
trains:  
Item  Rupees 
per metric 
tonne  Dollars 
per 
metric 
tonne1 Source and comments  
Cost of wheat  13,500  221.31  IFY 2013/2014 minimum support price  
Storage charges  368.4  6.04 3.07 rupees/month/5 0-kg bag at CWC warehouse Karnal  
Handling charges 
(mandi and warehouse 
labor)  301 4.93 Karnal CWC labor costs, 40 -45 rupees/metric ton per 
movement, times 4 movements (~170 rupees total), 
plus mandi labor costs per Haryana State Agricultural 
Marketing Boa rd,2 6.55 rupees per 50 kg. bag, or 
131 rupees per metric ton  
Gunny cost  600 9.84 Price of jute bags at Karnal, 30 rupees/bag times 
20 bags per ton  
Administrative charges  334.68  5.49 http://fciweb.nic.in/finances/view/9 , Procurement 
incidentals, wheat  
Statutory taxes  1,417.5  23.24  Haryana tax rate of 10.5% times MSP, which includes 
market fees, market cess, VAT  
Rail transportation  1,486.08  24.36  http://www.fois.indianrail.gov.in/   
TOTAL  18,008  295.21    
1 Exchange rate 61 rupees per dollar.  
2 "Market charges (payable by the Buyer per unit for 50 kg)". See page 2 of Memo 
No ME(I) -A-III-2013/76955 -7706 dated 3 December 2013,  http://hsamb.gov.in/notificatio n.pdf 
 
The United States notes that by this estimate the cost of wheat ex FCI's warehouse in 
Kandla would exceed the minimum export price established by India of $260 per metric 
tonne by $35.21.  
Table 2: Estimated the cost to India of a 30,000  metric tonn e shipment of FCI wheat 
exported from Pipava port following the tender that closed on 3 February 2014.  
Item  Rupees 
per metric 
tonne  Dollars 
per 
metric 
tonne1 Source and comments  
Cost of wheat  13,500  217.74  IFY 2013/2014 minimum support price  
Storage cha rges 368.4  5.94 3.07 rupees/month/50 -kg bag at CWC warehouse Karnal  
Handling charges 
(mandi and warehouse 
labor)  298 4.81 Ludhiana CWC labor costs, 40 -45 rupees/metric ton per 
movement, times 4 movements (~170 rupees total), 
plus 11.80 rupees per quintal at the mandi 
per http://dfpd.nic.in/fcamin/policy/Punjab.pdf  
Gunny cost  646.8  10.44  64.68 rupees/quintal per 
http://dfpd.nic.in/fcamin/policy/Punjab.pdf  
Administrative charges  334.68  5.40 http://fciweb.nic.in/finances/view/9 , Procurement 
incidentals, whe at 
Statutory taxes  1,957.5  31.57  Punjab tax rate of 14.5% times MSP  
Rail transportation  1,841  29.69  http://www.fois.indianrail.gov.in/ , Ludhiana -Pipava  
TOTAL  18,946  305.59    
1 Exchange rate average of 6 2 rupees per dollar in February 2014.  G/AG/W/161  
 
- 35 - 
 
  Note:  According to press reports, the price of that wheat as awarded was $275.20/metric tonne. The 
United States of America has assumed for purposes of this estimate that the wheat was of Punjabi 
origin and was shipped  by 50 -car unit train ("50 -wagon rake") from Ludhiana.  
 
According to this estimate, this shipment of wheat was exported at a price $30.39 below 
the total cost to the Indian government. Please confirm the accuracy of these estimates. 
If they are incorrect, please explain how and provide an accurate estimate.  
 
Answer by India  
 
India undertook to provide a response at a later stage.  
 
Follow -up: The European Union flagged interest in this subject.   
 
1.26  Switzerland's export subsidy budget  
1.26.1   Question by New Zealand (A G-IMS ID 83057)  
New Zealand thanks Switzerland for its continued transparency in the Committee on 
Agriculture on its export subsidies on processed agricultural products, including its 
foreshadowing in 2015 of the recently notified increase in outlays of CH F 26 million in 
2015 as compared to 2013 and 2014. New Zealand recalls its concerns about this 
increase of nearly 30% given the trade distorting effects of export subsidies and 
Ministers' commitments in the Bali Declaration on Export Competition, reaffirme d at 
MC10 in the Nairobi Decision on Export Competition, to exercise utmost restraint with 
regard to any recourse to all forms of export subsidies. At the 78th meeting of the 
Committee on Agriculture, in response to New Zealand's question (AG -IMS ID 78025)  
Switzerland reported that the Swiss Government intends to respect the export 
competition commitments that it made in Bali and that for 2016 it had submitted to 
Parliament a reduced budget which allocates CHF 68 million for contributions to exports 
of proc essed agricultural products. Can Switzerland provide the Committee with an 
update on its budget for 2016 and 2017 and outlays for 2016?  
 
Answer by Switzerland  
 
The annual budgets for 2016 and 2017 were fixed by Parliament at CHF 94.6 million. The exact 
outlays will be communicated through Switzerland's notification. These budget amounts are 
substantially below the entitlements in the schedule of Switzerland -Liechtenstein.  
 
Follow -up: New Zealand remind ed Members of the commitments made by Ministers in Bali , which 
were reaffirmed in Nairobi, to exercise utmost restraint with regard to any recourse to all forms of 
export subsidies.  New Zealand called for Members  to hono ur the commitment , although it was not 
legally binding. The United States registered intere st in this topic.  
 
1.27  Thailand's rice policies  
1.27.1   Question by United States of America (AG -IMS ID 83046)  
On-Farm Rice Pledging Program  
 
Thailand's On -Farm Rice Pledging Program, which started in November 2016, currently 
includes pledging for up to 1 million met ric tonnes (MMT) of white rice with an 
intervention price of 200  USD/MT and 2 MMT of fragrant and glutinous rice with an 
intervention price of 270 USD/MT. According to the Ministry of Commerce, the 
programme received around 1 MMT of paddy rice between Nove mber 2016 and February 
2017, of which approximately 80% was fragrant paddy rice, with the remainder being 
glutinous paddy rice, Pathum fragrant paddy rice, and white paddy rice.  
 
a. Please confirm the prices used and quantities procured by the government of 
each type of rice under this programme.  G/AG/W/161  
 
- 36 - 
 
  b. Are there any plans to extend or modify the pledging programme? If so, are 
there plans to increase the eligible quantity of rice or the intervention price of 
rice under the programme?  
Interest Rate Subsidy Program  
Thailand's Interest Rate Subsidy Program for rice millers, traders, and farmer 
institutions supports the production of white rice varieties.  
c. Besides the On -Farm Rice Pledging Program and the Interest Rate Subsidy Program, are 
there any other rice support p rogrammes in place that benefit white rice? Does the 
government of Thailand have any plans to implement new programmes that would 
include support for white rice?  
d. Please provide details on any other programmes that are currently in place or 
that are expecte d to be implemented that would include white rice.  
Public Tenders for Government Inventories  
In January 2017, the Thai Prime Minister reported that the government would dispose of 
all of its existing rice stocks in 2017. At that time, it was understood tha t 2.87 MMT of 
the government stocks were food -quality rice, approximately 3.15 MMT were 
feed-quality, and 1.85 MMT were non -edible, but could still be used for industrial 
purposes as ethanol use.  
On 16 February 2017, the government of Thailand announce d a tender for 2.87 MMT of 
food-quality rice and received qualified bids for 2.03 MMT. It is the United States' 
understanding that the stocks auctioned were primarily accumulated under the rice 
pledging scheme offered in MY 2012/13 and MY 2013/14. On 1 March 2017, the Ministry 
of Commerce finalized the sale of a portion of the 2.87 MMT food -quality rice tendered 
on 16 February. Even though qualified bids were received for approximately 2 MMT, only 
approximately 1 million metric tonnes were sold. The sale consi sted of 0.5 MMT of 5% 
grade white rice and 0.5 million metric tonnes of fragrant and glutinous rice.  
e. How does the government set the benchmark prices (minimum bidding prices) 
for its rice stocks in tenders? Is the benchmark price of food -grade rice stocks  
set based on domestic prices or competitors' export prices, such as Vietnamese 
and Indian rice prices? What other factors are taken into consideration while 
setting the price?  
f. In the most recent sale of food -grade rice stocks, the government sold rice 20 -
40% below current market prices. What factors drove these sales to occur at 
below market prices, as well as below the acquisition price under the rice 
pledging scheme?  
g. What steps are being taken to ensure the food -quality rice is not sold below the 
origin al acquisition price?  
h. Please confirm the quantity of stocks remaining after the March auction that 
are food -quality. If any food -quality rice remains, what is the government's 
plan for disposal?  
i. Of the Government of Thailand's stocks, an estimated 1.85 M MT have been in 
storage for more than 5 years and likely have deteriorated significantly. The 
United States understands the Thai Commerce Ministry is considering industrial 
uses for these non -edible stocks, such as biomass and ethanol production. 
Please pr ovide an update on how the disposition of these stocks will be 
managed.  G/AG/W/161  
 
- 37 - 
 
  Answer by Thailand  
 
Rice Pledging Scheme  
 
With regard to this question Thailand was informed by its capital that it is currently gathering 
information from relevant agencies and will u pdate the CoA as soon as the responses are received.  
 
The release of Rice in government stock  
 
The National Rice Policy and Management Committee is responsible for establishing policy 
framework, work plan, and the management of rice products with a view to  enhancing capacity 
and efficiency. In this regard, the committee has also approved the strategic framework and the 
procedures to release rice from the stock in a systemic, transparent, and fair manner. Each stock 
release must take into consideration the p rice and market situation at that time in order to prevent 
the negative impact on the price of rice while also protecting the interest of the government. In 
any case, the release of rice stock must not impact the new rice in the market.  
During the past two  years, from 22 May 2014 to 2016, the Ministry of Commerce has gradually 
released 8.76 MMT of rice from the stock, as mandated by the National Rice Policy and 
Management Committee. It will release the remaining 8.01 MMT of rice through channels in 
appropri ation with the condition of the rice, with consideration to the impact to the market and the 
price of rice and other grains. The release can be categorized into three groups:  
 release for general consumption;  
 release for industrial use which are not for hum an consumption purposes;  
 release for industrial use which are not for human or animal consumption purposes.  
For the 2nd and 3rd groups of release, there are measures in place to oversee and monitor the 
release to ensure that the rice are used in accordance  with its purposes and prevent the leakages 
into the normal market.  
 
In setting the price, the government considers the current price of rice with relevant quality, the 
deterioration of rice in stock, and the market situation of both domestic and internati onal market 
to prevent negative impact to the rice market mechanism.  
 
Follow -up: The European Union flagged interest in this subject.  
 
1.28  Turkey's subsidies aimed at incentivising the use of domestic dairy  
1.28.1   Question by New Zealand (AG -IMS ID 83058)  
At the 81st and 82nd meeting of the Committee on Agriculture (AG -IMS ID 81065 and 
AG-IMS ID 82067) New Zealand raised its concerns with the regulations issued by the 
Ministry of Food, Agriculture and Livestock (Communique on Fundamentals of Support 
and Practice for the Utilisation of Raw Milk). The regulations appear to create a subsidy 
directed at the use of domestic powdered and/or raw milk used as raw material in 
processed export products, which in turn suggests Turkey is incentivising the use 
domestic goods over that of imported goods. New Zealand welcomes the responses 
provided in previous meetings but notes that answers are yet to be provided to the 
questions, which for completeness we pose again in the 83rd meeting:  
 
a. Can Turkey inform the Committee of how such  a subsidy is consistent with its 
WTO  obligations, including Article 3.1(b) of the SCM Agreement?  
b. If the subsidy is WTO inconsistent, what steps is Turkey taking to rectify the 
situation?  
c. Can Turkey also explain in detail the policy objectives of the "Fu ndamentals of 
Support and Practice for the Utilisation of Raw Milk" subsidy programme?  G/AG/W/161  
 
- 38 - 
 
  Answer by Turkey  
 
Turkey would like to inform the Committee that the legislation concerning the support for raw milk 
has been repealed by the end of December 2016.  
 
Follow-up: Ukraine noted its interest in understanding the policy objective of the measure and its 
impact on trade. Ukraine asked if Turkey could provide information on the level of funding for this 
programme.  
 
1.29  Zambia's public stocks and exports of maize  
1.29.1   Question by European Union (AG -IMS ID 83014)  
The European Union repeats its question to Zambia (AG -IMS ID 81033)  from the last 
meeting since no reply has yet been received.  
 
The Food Reserve Agency, according to EU information, is responsible for ensuring a 
food security stock of 500,000  tonnes (= three  months of food consumption). During the 
2014/15 marketing year, the Food Reserve Agency seems to have bought in the order of 
1.2 million tonnes, of which part seems to have been exported at prices below the pri ce 
at which it was bought -in.  
 
Could Zambia indicate the prices at which maize was bought -in during the 2014/15 
marketing year and the average selling price in the internal market as well as the 
quantities sold on export markets from the Food Reserve Agen cy stocks?  
 
Answer by Zambia  
 
The key mandates of the Food Reserve Agency (FRA) are to:  
1. Administer the National Food Strategic Reserves;  
2. Provide market access to small scale farmers in rural and remote areas; and  
3. Manage national storage facilities.  
 
Crop p urchases – 2014/15 Marketing Season  
 
In 2014 crop marketing season, FRA purchased 1,031,303 metric tonnes of non GMO white maize, 
which accounted for 31% of the national maize production of 3.3 million metric tonnes for that 
year (June -October). This purch ase (in light of the national bumper harvest) was in line with 
FRA mandate to provide market access and income to small scale farmers in outlying and hard to 
reach remote rural areas where private sector participation is minimal or non -existent.  
 
The purch ase price of maize was K  70.00 per 50 Kg bag or K1, 400.00  per metric tonne, which 
reflects the cost of maize production for the farmers and derived from an analytical tool of the 
Crop Gross Margin Budget.  
 
Crop sales – 2014/15 Marketing Season  
In October 2014, FRA was authorised to offload and sell onto the market 650,000 metric tonnes of 
white maize as follows:  
 
 Local Market: 500,000 metric tonnes @ K76.00 per 50 kg or K 1,521.00 per metric tonne;  
 Export Market: 150,000 metric tonnes @ US240.00 per metric  tonne subject to review in 
line with market development.  G/AG/W/161  
 
- 39 - 
 
  2  POINTS RAISED IN CON NECTION WITH INDIVID UAL NOTIFICATIONS  
2.1  IMPORTS UNDER TARIFF AND OTHER QUOTA COMMITMENTS (TABLE MA:2)  
2.1.1   Iceland (G/AG/N/ISL/37)  
AG-IMS ID 83040: Question by United States of America - Transparency issues  
Iceland's recent MA2 notifications for 2014 and 2015 report 100% quota fill for a 
number of products, such as fresh meat and eggs.  
 
Please provide a list of countries that contributed to the TRQ fills along with correlating 
import vo lumes by country for the following TRQ product areas for 2014 and 2015?  
 
 Meat and edible offal of bovine animals;  
 Meat and edible offal of swine;  
 Meat and edible offal of poultry;  
 Eggs.  
Answer by Iceland  
 
Table A and Table B in Annex A  shows  import volume s by country for the TRQ product areas in 
question. Iceland's MA:2 notification G/AG/N/ISL/37 contains two reporting periods, 1  July 2014 to 
30 June 2015 and 1 July 2015 to 30 June 2016. Table A shows the import volume by country for 
these two periods. Att ention is drawn to the fact that import volume is labelled "NA" in column  2, 
as monthly import volume data is not available by country for 2014. However, import volumes by 
country are available on an annual basis for 2014. Due to incomplete data, the annua l data for 
2014 and 2015 is provided in Table B.  
 
2.1.2   Republic of Moldova (G/AG/N/MDA/7)  
AG-IMS ID 83015: Question by European Union - Tariff quota fill  
In this notification, the Republic of Moldova does not indicate the quota fill for three 
TRQs on sugar. Cou ld the Republic of Moldova correct its notification and notify the 
quota fill rates?  
 
Answer by the Republic of Moldova  
 
The notification indicates complete data. It includes the entire filled quota for all TRQs on sugar, 
being in conformity with Certifica tion of Modification and Rectification to schedule CLI – Republic of 
Moldova, reference number WLI/100 29 September 2009, WT/Let/655.  
 
2.2  SPECIAL SAFEGUARDS (TABLES MA:3 TO MA:5)  
2.2.1   Japan (G/AG/N/JPN/214)  
AG-IMS ID 83016: Question by European Union - Transparenc y issues  
Japan notifies a volume -based SSG on food preparations of flour for the period 1 
October 2016 to 31 March 2017 with a very low trigger volume of 43 tonnes. Could 
Japan supply information or explanation on how such negligible quantities could be a 
threat to the Japanese market for these products?  
 
Answer by Japan  
 
The trigger level of the volume -based SSG on food preparations of flour is properly calculated in 
accordance with Article 5 of the Agreement on Agriculture, as shown in the notification of  
G/AG/N/JPN/214.  
 G/AG/W/161  
 
- 40 - 
 
  2.2.2   Chinese Taipei (G/AG/N/TPKM/141)  
AG-IMS ID 83048: Question by United States of America - Transparency issues  
Chinese Taipei reported that imports of chicken cuts averaged 1,426.9 tonnes between 
2012 -14, while average consumption levels we re 211,794.4 tonnes over the same 
period. Using these two data points yields a very low import penetration 
level  (0.67%).  Please provide a justification for invoking the volume -based special 
safeguard with such a low level of import penetration.  
 
Answer b y Chinese Taipei  
 
Chinese Taipei confirms that the actions of SSG for the products concerned are fully in accordance 
with Article 5 of the Agreement on Agriculture.  
 
Chicken cuts are considered as one of Chinese Taipei's most sensitive products. Price vol atility 
caused by imports of such products into Chinese Taipei's shallow market even in a small amount 
could post a substantial risk on our domestic industry. Therefore, such measures remain 
necessary.  
 
2.2.3   Chinese Taipei (G/AG/N/TPKM/142)  
AG-IMS ID 83053: Qu estion by European Union - Transparency issues  
In this notification, Chinese Taipei notifies that it invoked the volume -based SSG on 
persimmons. In its notification G/AG/N/TPKM/148, Taipei indicates no imports under 
the persimmon TRQ. Could Taipei explain this apparent discrepancy?  
 
Answer by Chinese Taipei  
 
Chinese Taipei confirms that the actions of SSG for persimmons are fully in accordance with Article 
5 of the Agreement on Agriculture.  
 
The discrepancy noticed by the European Union is due to the fact t hat persimmon TRQ is no longer 
in action since 1  January 2008, while SSG on persimmons remains effective. The corrigendum of 
G/AG/N/TPKM/148 has been circulated to Members on 21 March 2017 which removes those 
expired TRQs from the notification.  
 
2.2.4   United St ates of America (G/AG/N/USA/111)  
AG-IMS ID 83017: Question by European Union - Other implementation issues  
For the 2015 calendar year, the United State s notifies that both the price ( and volume ) 
based SSG were applied to butter.  
 
Paragraph 1(a) and 1(b) o f Article 5 of the Agreement on Agriculture provides that both 
types of SSG cannot be simultaneously applied: "… (a) the volume of imports … exceeds 
a trigger level which relates to the exiting market access opportunity as set out in 
paragraph 4; or but no t concurrently: (b) the price at which imports …"  
 
Could the United States explain how it avoids applying both the price - and volume -based 
SSG to the same imports?  
 
Answer by United States of America  
 
The United States thanks the European Union for its que stion and concern. The price and volume 
safeguards for butter noted in the U.S. 2015 MA5 notification were not applied concurrently. Per 
footnote 1 and 2 of G/AG/N/USA/111, the volume safeguard on butter was from 5 October 2015 
through 31 December 2015, an d the price based safeguard was applied from 1 January 2015 
through 4 October 2015.  
 G/AG/W/161  
 
- 41 - 
 
  2.3  DOMESTIC SUPPORT COMMITMENTS (TABLE DS:1)  
2.3.1   Argentina (G/AG/N/ARG/36)  
AG-IMS ID 83020: Question by European Union - Transparency issues (including Table 
DS:2)  
Could Argenti na explain in more detail whether and the farm sector, any debt relief has 
been applied under the credit schemes for farmers and if so how this has been 
accounted for in the notification?  
 
Answer by Argentina  
 
No debt relief programme was established withi n the framework of credit schemes for farmers 
during the periods notified in document G/AG/N/ARG/36. It should also be noted that all the 
interest -rate subsidy programmes for loans to small -scale agricultural producers listed in 
document G/AG/N/ARG/36 were  notified by Argentina in Supporting Table DS:7 ("Product -Specific 
Aggregate Measurements of Support"). Further details of these credit schemes were provided at 
the 82nd meeting of the Committee on Agriculture in November 2016.  
AG-IMS ID 83049: Question by  United States of America - Transparency issues 
(including Table DS:2)  
The United States noted the significant steps taken by Argentina to bring its 
notifications up to date. Since 2013, Argentina has notified eight years of domestic 
support measures, prov iding a significant improvement in transparency.  
  
a. Argentina appears to be notifying two measures as meeting the criteria of 
paragraph  5 of Annex 2 of the Agreement on Agriculture; however, paragraph  5 
does not itself contain any specific criteria other th an a reference that 
payments made to producers must meet both the criteria of paragraph 1 and 
relevant criteria in paragraphs 6 -13. Please clarify, for each measure, which 
exemption criteria from the Agreement on Agriculture are being met.  
b. Argentina submit ted a DS:2 notification in 2003 for measures that went into 
effect in December 2000. Noting the large fluctuations in budgetary outlays for 
many measures, is any measure notified by Argentina in Supporting Table DS:1, 
either in this notification or previou s notifications, new or modified since 
December 2000?  If so, when will Argentina be submitting its DS:2 notification?  
Answer by Argentina  
 
Argentina notified programmes under Annex 2, paragraph 5, of the Agreement on Agriculture in 
document G/AG/N/ARG/36 a nd in previous notifications, as these programmes are consistent with 
the criteria set out in paragraphs (b) to (e) of paragraph 6, and the general criteria established in 
paragraph 1. Notifications G/AG/N/ARG/35 and G/AG/N/ARG/36 include programmes such a s the 
Support Programme for Small and Medium -Sized Producers (PAPYM) and the Inclusion and Rural 
Development Programme (PIDER), which, despite appearing as new programmes, were created 
under policies that had been implemented for small and medium -sized pro ducers for years. As 
indicated in the replies given by Argentina at the 82nd meeting of the Committee on Agriculture, 
PAPYM is a programme that shares many of the objectives and dynamics of the Agricultural Social 
Programme (PSA), which Argentina has been providing information on ever since its first domestic 
support notification for 1996 (G/AG/N/ARG/4). Both PAPYM and the PSA ceased to function 
independently in 2013  when t hey were merged  to form a single programme: PIDER. PIDER was 
notified in Argentina's most recent notification, G/AG/N/ARG/36.  
AG-IMS ID 83051:  Question by United States of America - Transparency issues 
(including Table DS:2)  
Argentina's Special Fund for Tobacco appears to be multifaceted with numerous 
measures that have been notified acros s much of the Green Box. The United States 
notes that according to the website for the Special Fund for Tobacco Administration in 
Salta Province, the Special Fund for Tobacco "was created to ensure that the producer 
receives a premium, based on the latter providing high quality tobacco." The website G/AG/W/161  
 
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  argues that the costs borne by the tobacco producer exceed the import price of the 
good. The website further states that the Special Fund for Tobacco funding is provided 
under Law 19800, with 80% of the funding being provided to provincial governments of 
tobacco -producing provinces.  The provincial governments determine the use of the 
funds according to given priorities.   
 
a. The United States seeks a better understanding of what the Special Fund for 
Tobacco is and h ow the fund is generally structured.  In providing an 
explanation of the Fund, please elaborate on the following:  
i. Whether there is any requirement to produce tobacco or other commodities 
to be eligible for payments for any measures under the Fund.  
ii. How the g overnment of Argentina ensures funding provided to provinces is 
in conformity with the green box criteria under which support is notified?  
iii. Any other information that would help provide a better understanding of the 
structure, function, and implementation o f the Fund.  
b. A number of measures including training services, extension and advisory 
services, inspection services, infrastructural services, and direct payments to 
producers, notified under the Special Fund for Tobacco, saw significant changes 
in outlays from 2009/10 to  2010/11.  
i. Please explain the cause for the change in outlays for each of the listed 
services.  
ii. Were these changes accompanied by any changes in how the program mes 
operate?  
Answer by Argentina  
 
Under existing legislation, producers must be reg istered in the National Register of Tobacco 
Producers to receive Special Fund for Tobacco (FET) payments under the Amber Box. Registration 
is renewed annually between 1 July and 31 October. The government of Argentina, through its 
specialized departments, assesses the support measures proposed by each provincial government 
and gives consideration to the need for the measure, the measure's impact on producers, and its 
consistency with Green Box criteria. The country's Green Box support measures relate mainly  to 
the provision of general services (infrastructure, inspection and research), disaster/accident 
support, and medical services, all of which seek to improve producers' quality of life. The support 
measures therefore seek to provide assistance in terms of  those actions most oriented towards 
regional development in tobacco -producing provinces. Such actions are consistent with the 
objective of Law No. 19.800 on the improvement of production techniques, the integration of the 
activity into a coherent agricult ural policy, the industrialization of production, and the addressing 
of critical economic and social problems in tobacco -growing areas. Further information on the FET 
is available on the official website of the Ministry of Agroindustry at: 
http://www.agroindustria.gob.ar/sitio/areas/tabaco/index.php . 
 
Argentina would like to clarify that the support measures funded from 2009/2010 to 2010/2011 
were based on analysis carried out by the provincial governments, and derived from the need to 
reinforce certain measures to the detriment of others. This did not relate to any changes in how 
the programmes operate, but to climate -related and sanitary problems affecting the provinces in 
the no rth of Argentina, which made it necessary to adjust the programmes concerned.  
AG-IMS ID 83050: Question by United States of America - General services: pest and 
disease control  
From 2009/10 to 2011/12, budgetary outlays for animal health measures notified under 
pest and disease control increased significantly. Please provide an explanation for this 
increase in outlays.  
 
Answer by Argentina  G/AG/W/161  
 
- 43 - 
 
   
Argentina gives great importance to the safety and quality of the products and foods marketed in 
the country and expor ted worldwide. For this reason, Argentina is constantly introducing measures 
and programmes that seek to strengthen its Health Service. Secondly, with regard specifically to 
the increase recorded for the animal health programme (notified in document G/AG/N /ARG/36 
under paragraph 2(b) of Annex 2 of the Agreement on Agriculture) from 2009/2010 to 2011/2012, 
it should be noted that the main cause has been the increase in expenditure for the inputs covered 
by thi s programme. The main inputs that  increased in th e period concerned were:  
 
i. doses of foot -and-mouth disease vaccine;  
ii. doses of Rev 1 vaccine for the control of brucellosis in goats; and  
iii. disposable inputs used for the screening of various diseases. Such changes are due 
to normal variations in the implemen tation of the various health programmes and do 
not imply any change in the country's health status.  
AG-IMS ID 83019: Question by European Union - Other product -specific AMS/EMS  
Could Argentina explain in more detail the wine sector measures "programa de 
asistencia para la cadena de valor vitivinicola argentina" as well as and conditions for 
receiving support and the method used to calculate the support level?  
 
Answer by Argentina  
 
The Assistance Programme for the Argentine Wine Value Chain seeks to restore  and consolidate 
historic vine -growing areas throughout national territory; consolidate, by vine -growing region, the 
various speciality products concerned (wine, grape must, raisins and fresh grapes); and improve 
small -scale wine producers' participation i n income distribution within the chain, etc. Priority is 
given to funding projects that promote the development of small -scale wine producers, vineyard 
contract workers, producers of homemade and artisanal wines, and small and medium -sized 
manufacturing es tablishments, especially those of an associative nature. Projects are funded 
through non -repayable contributions (ANRs) and the creation of revolving funds for vineyard 
improvement, the joint purchasing of inputs and the acquisition of production and bottl ing 
equipment for individual and community use that seeks to improve the quality of manufactured 
products, etc. Priority is given to associative projects. The beneficiaries of this programme are the 
public and/or private bodies that implement production -related projects aimed at developing 
viticultural activity, such as NGO's, cooperatives, educational institutions, and associations, and 
that encompass small and medium -sized wine producers with up to 20 hectares of land, and 
producers of homemade and artisa nal wines, which are not of a "boutique" nature.  
AG-IMS ID 83052: Question by United States of America - Other product -specific 
AMS/EMS  
The United States notes that Argentina's notified Total AMS is typically close to 
Argentina's commitment levels as a res ult of support provided to a single commodity: 
tobacco. What steps does Argentina take on an annual basis to ensure its product -
specific support for tobacco remains below its Total AMS commitment levels?  
 
Answer by Argentina  
 
Within the framework of its WT O obligations, Argentina undertook domestic support commitments 
in accordance with the Agreement on Agriculture and its Schedule of Commitments LXIV. The Final 
Act embodying the results of the Uruguay Round of Multilateral Trade Negotiations, the Ministeri al 
Decisions, Declarations and Understandings and the Marrakesh Agreement Establishing the World 
Trade Organization was approved by Argentina through Law No. 24.425. Under Articles 3 and 6 of 
the Agreement on Agriculture, the obligations of which were inco rporated into Argentina's 
domestic legislation by Law No. 24.425, domestic support measures (AMS) specified in 
Schedule  LXIV, Part IV, Section I, constitute a limit on subsidies, and support in favour of domestic 
producers may not be provided in excess of the reduction commitment levels specified in that 
Schedule, in the case of Argentina, 75.021.292 in 1992 pesos, which is equivalent to the US  dollar 
value for that year. This is taken into account every year in each administrative act approving 
budgetary o utlays. The administrative acts relating to the agricultural years 2009/2010, G/AG/W/161  
 
- 44 - 
 
  2010/2011, 2011/2012, 2012/2013 and 2013/2014 are Resolutions Nos. 3/2010, 989/2010, 
47/2012, 1304/2012 and 6/2013, respectively. In this respect, the administered minimum 
price (FET price) established by MINAGRO is applied proportionally among the provinces, bearing 
in mind from the outset Argentina's bound AMS limit. In turn, transfers to the provinces are 
verified on a monthly basis, partly to ensure compliance with the nationa l budget.  
 
2.3.2   Brazil (G/AG/N/BRA/41, G/AG/N/BRA/40, G/AG/N/BRA/32)  
AG-IMS ID 83018: Question by European Union - Transparency issues (including 
Table  DS:2)  
Concerning G/AG/N/BRA/41, according to the Memorandum of Understanding between 
the United States and Br azil to settle dispute DS267 (United States — Subsidies on 
Upland Cotton), the United States has paid Brazil USD 300 million. Part of this money is 
administered by the private fund BR Advisory Partners Participacoes SA. According to 
press reports this fund  has received USD  234 million and at least half of this amount has 
been used for loans to cotton farmers.  
 
a. Can Brazil describe more in detail how the USD 300 million compensation 
received from the United States under the Memorandum of Understanding on 
cotton is distributed and which entities benefit from these amounts? Can Brazil 
also clarify the criteria for distribution to the recipients?  
b. Can Brazil indicate whether this support has been included in the 
DS:1  notification  G/AG/N/BRA/41?  
Answer by Brazil  
 
a. The total compensation received from the United States under the Memorandum of 
Understanding was R$ 2,147 million. The Brazilian Cotton Institute (IBA, its acronym in 
Portuguese), a non -profit civil association with administrative and financial autonomy , is 
the entity in charge of managing and investing the funds received, in accordance with 
the Memorandum. Until June 2016, the IBA has disbursed R$ 528 million to support 
projects in the cotton sector, following the list of authorized activities in the 
Memorandum, including technical cooperation projects with cotton producing countries in 
Africa. The remaining amount was R$ 1,619 million; 81.5% of this amount was put in 
investment funds. The amount placed at BR Partners Investment Fund was 
R$ 870 million. The BR  Partners Investment Fund is the Institute's exclusive investment 
fund. This fund is for an undetermined period and was organized as a closed -end fund, 
classified as multimarket fund, which may invest more than 50% of its net assets in 
assets or oper ating modalities under the responsibility of individuals or private legal 
entities. BR  Partners, as the fund's administrator, performs bank credit transactions at 
market interest rates. Producers with borrowings from the referred fund include related 
parties of the Institute's administration. The amount of transactions with related parties 
at the date of the latest financial statement (June 2016) is R$ 157 million. Information 
about Brazilian Cotton Institute is publicly available and can be found at its we bpage in 
English ( http://www.iba -br.com/en ).  
b. As the Brazilian government has no control over BR  Partners Investment Fund, and 
taking into account that the financing to cotton producers is done at market interes t 
rates, these transactions are not notified as measures to support cotton producers.  
AG-IMS ID 83074: Question by United States of America - Transparency issues 
(including Table DS:2)  
Concerning G/AG/N/BRA/41, the United States notes that in response to A G-
IMS ID 79038, Brazil confirmed that no programme of the states has been included 
(rural development, technical assistance or otherwise) in its previous notification 
(G/AG/N/BRA/40). It is the United States understanding that because Federal 
Government ou tlays constitute the vast majority expenditures Brazil does not intend to 
include state level outlays in its notifications.  
 
a. Please explain what the state money is used for.  G/AG/W/161  
 
- 45 - 
 
  b. Please explain how "negligible" is defined/determined.  
c. Please inform whether State  expenditures are always considered negligible.  
Answer by Brazil  
 
a. According to the information available, most part of the state money is used as 
investment loans.  
b. The state money used as credit is included in Brazil's notifications, since all data used to 
calculate Brazil's credit subsidy is from Brazil's Central Bank, which does include state 
loans. According to Brazil's data for crop -year 2015/16, only 0,017% of the soft loans 
provided were state money.  
c. Apart from credit loans, all other state  expenditures have always been considered 
negligible.  
AG-IMS ID 83075: Question by United States of America - Transparency issues 
(including Table DS:2)  
Supporting Table DS:1 (G/AG/N/BRA/41)  
 
The United States notes some significant changes in budgetary o utlays from 2014 to 
2015 in Brazil's Green Box measures for a number of categories including, but not 
limited to:  
1) research declined from USD 163.6 million to USD 82.1 million,  
2) extension and advi sory services declined from USD  906.6 million to 
USD 57.6 million,  
3) infrastructural services decline d from USD 497.4 million to USD  30.4 million,  
4) marketing and promotion services declined from USD  29.0 million to 
USD 3.5 million, and  
5) public stockholding for food security purposes declined from USD  371.7 million 
to USD  123.6 million. This has resulted in a significant overall decrease in 
Brazil's Green Box outlays.  
 
a. What was the reason for these significant declines in expenditures in 2015?   
b. If the declines were not part of a single overall change in Brazilian agri cultural 
policy or situation, please provide, for the above identified categories, the main 
reason for changes in each.  
Answer by Brazil  
 
a. and b. The main reason for these changes in budgetary outlays in Brazil's Green Box 
measures is the fiscal crisis t he country has been experiencing. The exchange rate 
devaluation of the Brazilian Real from 2014 to 2015 also contributed to these reductions.  
AG-IMS ID 83076: Question by United States of America - Market price support  
Supporting Table DS:5  
 
In 2014/15 (G/ AG/N/BRA/41), Brazil notified Minimum Support Prices for edible beans 
and maize. In the previous year (G/AG/N/BRA/40), Brazil notified Minimum Support 
Prices for edible beans, maize, and wheat, as well as Public Option Contracts for coffee 
and maize.  The U nited States notes Brazil's response to AG -IMS ID 66002, which states 
that MAPA allocates budget funds according to current needs and conditions to decide 
which program mes to use.  Further, Brazil clarified that in order for any of the relevant 
Minimum Supp ort Price programmes to be activated by MAPA then the following two G/AG/W/161  
 
- 46 - 
 
  conditions would need to be met: 1) market prices should be markedly below the 
minimum price and 2) the budget is available.  
  
a. Please describe the difference between the two notified Marke t Price Support 
programmes: 1) Minimum Support Price and 2) Public Options Contract.  
b. Please explain how MAPA determines when or if either program me is activated 
in a given year.  
c. Please detail the criteria upon which MAPA determines that market prices are 
"markedly below the minimum price."  
d. For both 2013/14 and 2014/15, please detail what level of budgetary outlays 
were available for each notified commodity procured. Please indicate in the 
response whether a set budgetary limit is predetermined when the app lied 
administered price is announced for each program me and if so, what that value 
is. If no predetermined budgetary limit is set, please explain what determines 
the limit that may be procured in a given year.  
Answer by Brazil  
 
a. The programme notified un der "Minimum Support Price " is the Federal Government 
Acquisition Program (AGF). This programme enables the government to guarantee 
minimum price to rural farmers through direct purchases from producers. The "Public 
Options Contract " is a sales option cont ract bond program me bid at public auctions to 
rural producers. Auctions' winners acquire the right to sell their products by a reference 
price (minimum price plus storage and financial costs), with future liquidation date. The 
contract option ensures its b uyers the right to deliver to the government the amount of 
product tied to the operation at its maturity.  
b. The Public Options Contract is usually used to guarantee minimum price when it is 
expected that the price will be higher than the minimum price at  the liquidation date 
(usually off season). Most of the Public Options Contract is not liquidated because the 
market price in off -season periods is usually higher than the minimum price. However 
the quantity notified encompasses all the sale options sold i n public auctions. Budget 
restrictions can be a reason to choose option contracts instead of the AGF. In case of the 
AGF, government disbursements are performed immediately. In Public Options Contract, 
the disbursement is performed in the future as long as  the price is lower than the 
minimum price.  
c. As the Federal government does not have any official agency to continuously monitor 
information on market prices of all agriculture products in all municipalities, MAPA has to 
rely on non -official sources of information to determine if a product price is below the 
minimum price.  
d. The budget for both programmes is the same, and it is defined for all the products 
covered by minimum prices, according to budgetary law. Therefore, there is no budget 
allocation b y product. When it is determined that market prices are undeniably lower 
than the minimum price, and there is budget available for it, MAPA makes a public 
announcement at its website and to the press indicating in which state or region the 
programme will o perate, the amount of money available for it, and, according to the 
minimum price established, the maximum estimated quantity to be purchased.  
AG-IMS ID 83073: Question by United States of America - Other product -specific 
AMS/EMS  
The United States understa nds that notified data can be affected by definitions of 
marketing years and lags in reporting; however, the United States notes that the 
marketing/agricultural year used for notifying wheat in Brazil's notifications appear to 
be for the following year (e. g., 2014/15) rather than the marketing/agricultural year 
covered by the notification (e.g., 2013/14).  For example, in G/AG/N/BRA/40, Brazil 
states that the beginning of the agricultural year for wheat is March 2014, indicating G/AG/W/161  
 
- 47 - 
 
  that the year runs from March  2014 through February 2015; however, the notification is 
for 2013/14.  All other commodities appear to be notified starting with a date occurring 
in 2013 and, as such, matching the 2013/14 year for the notification.   
 
The United States' understanding appea rs to be consistent with data published on 
official Brazilian websites.  For example, official statistics show PEPRO payments for 
wheat in agricultural year 2014, but not 2015. This appears to be consistent with 
Brazil's 2013/14 notification (G/AG/N/BRA/40)  showing PEPRO wheat payments 
starting in 2014, but not for Brazil's 2014/15 notification (G/AG/N/BRA/41), which do 
not show PEPRO wheat payments starting in 2015.  
 
Please explain the basis for notifying wheat on an agricultural year starting in the year 
following the period covered by the notification.  
 
Answer by Brazil  
 
All the crops that were notified as receiving support are harvested in the same calendar year. 
Brazil's "summer crops " (soybean, maize, cotton, coffee, sugarcane and others) are harvested in 
the first semester of the year and the "winter crops " (wheat, barley and oats) are harvested in the 
second half of the year. In order to keep Brazil's notifications as updated as possible, Brazil 
chooses to notify the respective crops' most recent figur es. 
 
AG-IMS ID 83077: Question by United States of America - Non-product -specific AMS  
Supporting Table DS:9  
  
Concerning G/AG/N/BRA/41, from 2013/14 to 2014/15, notified budgetary outlays for 
Insurance Programmes declined from USD 434 million to USD 56 mil lion. These 
programmes are footnoted as the "Programme of Supp ort to Rural Insurance 
Premiums  (PSR)" for 2014/15 and no longer includes the footnoted reference to the 
"Agricultural Livestock Guarantee Programme (PROAGRO)" listed for 2013/14.  
 
a. Has the PROAG RO been discontinued?  
b. If so, does the termination of PROAGRO account for the full decline in notified 
outlays?   
c. Please provide details as to how the PSR operates. Please also indicate any 
changes in the program me since 2013/14.  
d. Did the PSR replace the "Ri sk Minimizing Agribusiness Program" last notified 
in G/AG/N/BRA/37?  
e. The United States would appreciate any other details regarding how all of these 
programmes relate to one another.  
Answer by Brazil  
 
a. No. The programme is still in place. It was not menti oned at the footnote because there 
were no budgetary outlays for it in 2015. As there were no severe droughts or any other 
risk which generated crop loss, the programme did not have any deficit in that year.  
b. As stated above, the PROAGRO is still in pla ce, but was not notified because there were 
no government disbursements. In the 2014 figures, the budgetary outlays of PROAGRO 
accounted for 61% of the total figures. The reduction from the remaining $180 million to 
the current $56 million is due to the fi scal crisis that the country is presently 
experiencing.  
c. The producer chooses to contract an insurance policy with one of the insurance 
companies accredited by the government. The minimum coverage level for grain 
insurance is 60% of the historical crop production (Multi -Peril Crop Insurance - MPCI). G/AG/W/161  
 
- 48 - 
 
  Through the PSR Program, the government provides subsidy to rural insurance premium 
(fee), currently ranging from 35% to 45% of the fee value, according to the level of 
coverage and the activity (agriculture or livestock). Currently the limit is R$ 144 
thousand of subsidy per farmer per year. With regard to changes since 2013/24, the 
maximum level of subsidy decreased from 70% to 45% of the insurance premium, and 
the limit of subsidy per farmer was reduced fro m R$ 192 thousand to R$ 144 thousand.  
d. No. Since 2004/2005 both PSR and PROAGRO are notified under the "Risk Minimizing 
Agribusiness Program". Before the creation of PSR, the PROAGRO was not notified 
because no deficit was verified at the programme in t he long term. After this, Brazil 
decided to notify the deficit of the programme, whenever it happens.  
e. There is no correlation between them. The PROAGRO operates as a credit insurance and 
is mandatory when the producer takes any credit under a governmen t credit 
programme. The fee is 3% of the credit value, and the limit of the coverage is currently 
R$ 300 thousand.  
2.3.3   Canada (G/AG/N/CAN/113)  
AG-IMS ID 83078: Question by United States of America - Transparency issues 
(including Table DS:2)  
The United States notes that Canada has listed sugar beets in Supporting Table  DS:4 
with a footnote stating that no existing product -specific support measures are provided 
to sugar beets and that sugar beets are not referenced elsewhere in the notification.  It 
is also noted  that chicken, turkey, and eggs are all also identified in Supporting 
Table  DS:4 without any associated budgetary values.  These products are also listed in 
Supporting Tables DS:6 and DS:7. Do any product -specific measures exist for chicken, 
turkey, and egg s despite no payments in the covered period?  
 
Answer by Canada  
 
As explained in the footnote under Supporting Table 4, the value of production figures for sugar 
beets are no longer available. Therefore, any product specific programmes for sugar beets would  
be reported under "other crops ". There are currently no product -specific support measures in place 
for chicken, turkey or eggs.  
AG-IMS ID 83079: Question by United States of America - Market price support  
The United States notes that Canada continues to e xclude butter and skim milk powder 
for further processing under Classes 4m (powder) and 5 a, b, and c and for exports from 
eligible production. Moreover, the United States takes note that the volumes marketed 
through these classes have been rising.  
 
In re sponse to the European Union's question (AG -IMS ID 70066), Canada stated that 
"Those quantities of butter and skimmed milk powder are not eligible to benefit from the 
applied administered prices under the system and therefore as excluded from the total 
production. The calculations are consistent with paragraph 8 in Annex 3 of the 
Agreement on Agriculture."  
 
a. Please provide the regulation that establishes the level of annual butter and 
skim milk powder production that is eligible to receive the applied admini stered 
price.  
b. When the Canadian Dairy Commission announces the applied administered 
prices for butter and skim milk powder, does it also announce the level of 
butter and skim milk production that is eligible to receive the applied 
administered price?  
Answe r by Canada  
 
a. A level of annual butter and skim milk powder production "eligible " to receive the applied 
administered price is not established. Support prices are the prices at which the G/AG/W/161  
 
- 49 - 
 
  Canadian Dairy Commission purchases and sells butter and skim milk powder within the 
framework of its various program mes. Under the Domestic Seasonality Program, when 
milk production exceeds requirements for the Canadian market, the Canadian Dairy 
Commission buys butter and skim milk powder from processors at established support 
prices.  
b. No, it does not.  
AG-IMS ID 83080: Question by United States of America - Non-product -specific AMS  
Noting the details already provided by Canada in G/AG/N/CAN/91, the United States 
would appreciate a greater understanding of how the Agr iStability programme 
operates.  It is the United States' understanding that the Stabilization component of 
AgriStability compensates at a rate of 70% for margin declines from 15% to 30%, while 
the Income Disaster component of AgriStability compensates at a rate of 80%  for 
declines greater than 30%. It is also the United States' understanding that there is a fee 
to participate in the AgriStability programme.  
 
a. Please confirm if this understanding is correct.  
b. Are the Stabilization and Disaster components separa te programmes with 
separate fee rates, or must producers enroll in both components to be eligible?   
c. Please explain what the notified AgriStability enhancements are and how they 
relate to the "Stabilization Component of AgriStability" also notified in 
Suppo rting Table DS:9.  
In both 2012 and 2013, the United States notes that Canada notified negative budgetary 
outlays for "Agristability enhancements" and these are not notified as associated 
fees/levies.  
 
d. Please explain what these negative values represent.   
e. Was this outlay subtracted from the total non-product -specific AMS?  
Answer by Canada  
 
2013 support notification on AgriStability covers the final year of the Growing Forward 
framework  (2008 -2013). Under Growing Forward, the AgriStability programme includes a 
Stabilization component and a Disaster component. The Stabilization component of AgriStability 
compensates producers at a rate of 70% for margin declines between 15% and 30%. The Disaster 
component compensates producers at rate of 80% for declines greate r than 30%. A Participant is 
eligible for a payment at a rate of 60% if their margin for a programme year is less than zero 
(negative margin), and they had positive margins for at least two years over the past five years. 
To participate in the programme, p roducers must pay a programme fee of $3.83 per $1,000 of the 
producer's reference margin. Participant producers also pay a $55 Administration Cost Share 
(ACS) fee to cover a portion of the Program administration costs.  
 
a. Yes, the understanding of the Ag riStability programme under Growing Forward is 
correct. Under Growing Forward 2 (2013 -2018), the coverage level provided under the 
programme has been reduced, such that it focuses on assisting producers facing severe 
market volatility and disaster situatio ns  
b. Under Growing Forward, the AgriStability programme has a Stabilization and Disaster 
component. Producers enroll in the programme only once and become eligible for 
payments if they experience a margin decline that falls under the specified thresholds .  
c. AgriStability enhancements are provincial programmes that increase the reference 
margin to take into account the negative effects of the drought and BSE on the sector. 
Maximum payments are 70% of the new reference margin.  G/AG/W/161  
 
- 50 - 
 
  d. The negative amount is a result of producers reimbursing the government for 
overpayments that were issued under the programme.  
e. Yes, this amount was subtracted from the total non -product specific AMS.  
Follow -up: The European Union and New Zealand registered support for questio n 
AG-IMS ID 83079.  
 
2.3.4   Chile (G/AG/N/CHL/48)  
AG-IMS ID 83085: Question by United States of America - Non-product -specific AMS  
The United States notes that Chile reports Irrigation Law No. 18 450 under both 
Supporting Table  DS:1 and Supporting Table DS:9.  
 
a. Please explain the measures under Irrigation Law No. 18450 that are notified 
in Supporting Table DS:9.  
b. Please explain how the notified value is calculated in Supporting Table DS:9.  
c. Please explain the relationship between the parts of the law reported in 
Supporting Tables DS:1 and DS:9.  
Answer by Chile  
 
a. The measures notified in Supporting Table DS:9 correspond to the incentive for private 
investment in irrigation works on farms.  
b. The notified value in Supporting Table DS.9 corresponds to resources for agricultural 
projects transferred to agricultural producers during the calendar year.  
c. The information in Supporting Table DS:1 corresponds to resources transferred for 
generally available irrigation projects.  
AG-IMS ID 83125: Question by Canada - Class ification of measures  
Canada notes that in its most recent domestic support notification covering 2014 and 
2015 (G/AG/N/CHL/48), Chile continues to notify an agricultural insurance programme 
that, "allows the agricultural sector to protect itself against e conomic losses resulting 
from natural disasters" under paragraph 5, Annex 2.  
 
Questions regarding the classification of this insurance scheme have been raised at 
previous meetings (AG -IMS ID 71038, AG-IMS ID 66047 and AG-IMS ID 38011) and 
suggestions that  classification under paragraph 8, Annex 2 would be a more 
appropriate.  
 
a. What is the current rate of the government subsidy of a producer's insurance 
premiums?  
b. Could Chile elaborate on the differences between "Agricultural insurance" 
notified under Measu re 2.5 and the "Agricultural Emergency Fund" notified 
under Measure 2.8 as both appear to provide coverage to address losses due to 
unforeseen events such as climatic events or other natural disasters.  
Answer by Chile  
 
a. State support for the partial fin ancing of the agricultural insurance premium varies 
between 40% and 70% of the premium, plus a fixed sum of 1.0 development unit (UF) 
per policy.  
b. Nevertheless, payment by the State may not exceed 80 UF per policy (approximately 
US$3,200).  "Agricultural insurance" is an instrument (or incentive) which producers can G/AG/W/161  
 
- 51 - 
 
  apply for before a disaster takes place. "Agricultural Emergency Fund" is an instrument 
which the Government uses after a natural disaster takes place.  
2.3.5   European Union (G/AG/N/EU/34)  
AG-IMS ID 83081:  Question by United States of America - Direct payments: decoupled 
income support  
In 2013/14 the European Union notified EUR 31.8 billion in decoupled income support 
under a number of listed measures.  It is also understood that the Single Payment 
Scheme (SPS) was replaced as part of the 2013 CAP reform.  
 
a. Please provide a breakdown of the expenditures for each measure.  
b. What are the general impacts of the 2013 reform on expenditures of SPS and 
its successor programme(s)?  
Answer by European Union  
 
The 2 013 CAP reform only applied from the 2014/15 marketing year (EU budget year 2015), and 
will therefore only be taken into account for the next EU DS:1 notification. For further detail on the 
2013 reform, see the EU DS:2 notification G/AG/N/EU/35.  
AG-IMS ID 83082: Question by United States of America - Payments based on fixed 
areas or yields  
In 2013/14 the European Union notified no expenditures for the transitional fruit and 
vegetables payments. Why were no expenditures notified?  
 
Answer by European Union  
 
The reference should be "Supporting table DS:3". Total expenditure was less than EUR  50.000 and 
it is not visible in the table due to rounding of the numbers. The total amount of spending was 
EUR 18.000, which is included in the total amount in the table.  
AG-IMS ID 83126: Question by Canada - Market price support: Eligible production  
In the European Union's most recent DS:1 notification, Canada notes that eligible 
production for wheat increased by 10,251 thousand tonnes in 2013 -2014 compared to 
the 2012 -2013 year. Could the  European Union please explain this significant increase in 
eligible production?  
 
Answer by European Union  
 
Total EU production increased by 10.251 million t onne. In line with the Appellate Body ruling in the 
Korea beef dispute, the Euro pean Union takes into account total common wheat as eligible 
production in calculating its Market Price Support (MPS).  
AG-IMS ID 83109: Question by Australia - Other product -specific AMS/EMS  
Australia thanks the European Union for it s domestic support 
notification  (G/AG/N/EU/34). Australia  notes that the EU wine market has been under 
reform since 2008. Spending on 'Restructuring of the Wine Market' continue to be in 
excess of EUR  500 million each year.  
 
Can the European Union please provide Members with an  update of the process of the 
wine market reform and restructuring, and when it is likely to be completed?  
 
Answer by European Union  
 
The European Union notes that the heading 'Restructuring of the wine market' is not accurate, the 
correct title of this su pport measure being 'Restructuring and conversion of vineyards'. This is an 
important support measure within the EU wine sector which may cover one or more of the 
following activities:  
 G/AG/W/161  
 
- 52 - 
 
  a) varietal conversion, including by means of grafting -on;  
b) reloca tion of vineyards;  
c) replanting of vineyards where that is necessary following mandatory grubbing up for 
health or phytosanitary reasons;  
d) improvements to vineyard management techniques, in particular the introduction of 
advanced systems of sustainabl e production.  
The spending of around EUR 500 million should be seen against this wider context. The national 
support programmes, which include among other also this measure, should be considered as an 
ongoing process programmed up to 2023.  
AG-IMS ID 8308 3: Question by United States of America - Other product -specific 
AMS/EMS  
a. In 2013/14 the European Union notified EUR 16.6 million in 'other product -
specific budgetary outlays' for beef, as well as market price support where the 
notified applied administered  price was below the fixed external reference 
price.  In Supporting Table DS:4, the European Union notified zero support for 
comparison against the permitted de minimis  level.  
i. Please detail what was the EUR 16.6 million measure for beef in 2013/14.  
ii. The Euro pean Union's notification indicates this measure was offset by a 
negative market price support measure that had no associated fees or 
levies. Please explain the rationale for zeroing out actual budgetary outlays 
that benefited beef producers in Supporting Table DS:4.  Further, please 
indicate how the negative market price support for beef notified by the 
European Union was a negative benefit, tax, or other cost born by beef 
producers resulting in the negation of actual support provided.  
b. The equivalent measur e of support for wine in 2013/14 increased nearly 
fourfold to EUR 188.1 million from EUR 49.6 million in the previous year. Please 
explain the reasons for the increased expenditures.  
Answer by European Union  
 
a.  
i. These amounts concerns support paid fully o ut of national budgets and concerns 
support for suckler cows and protection of certain breeds.  
ii. Since the EU administered price for beef is below the External Reference Price, the 
MPS becomes negative. However as is seen from table DS:4 this negative amoun t is 
not taken into account in the Current Total AMS.  
b. This measure has existed for many years, even before the 2008 reform of the wine 
sector, but market conditions in 2013/14 marketing led member States to use this 
measure more than in previous years.  
AG-IMS ID 83108: Question by Australia - Non-product -specific AMS  
Australia thanks the European Union for its domestic support notification 
(G/AG/N/EU/34).  Australia notes that spending on the Green Box measure 'National 
support measures: insurance subsid ies' has been trending up in recent years 
(EUR  419.3  million in 2011/12, EUR 500.7 million in 2012/13, and EUR 683.8 million in 
2013/14). Can the European Union outline:  
 
a. the reason for this increasingly upward trend  
b. the effect of the 2013 CAP reform on this measure  G/AG/W/161  
 
- 53 - 
 
  Answer by European Union  
 
This measure comprises general insurance subsidies, falling under Amber Box Non -Product Specific 
support. There has been an increase of the use of such subsidies over the recent years. These 
subsidies are paid fully out of member State budgets and not from the EU budget.  
AG-IMS ID 83127: Question by Canada - Non-product -specific AMS  
Under Supporting Table DS:9, non -product specific support for Insurance Subsidies 
increased substantially going from EUR 500.7 million i n 2013 -2014 to EUR 683.8 million 
in 2014 -2015. Could the European Union please provide details on the conditions that 
lead to this significant increase in expenditures?  
 
Answer by European Union  
 
This measure comprises general insurance subsidies, falling under Amber Box Non -Product Specific 
support. There has been an increase of the use of such subsidies over the recent years. These 
subsidies are paid fully out of member State budgets and not from the EU budget.  
AG-IMS ID 83084: Question by United States of America - Non-product -specific AMS  
The European Union notified "other" under National support measures" in Supporting 
Table DS:9. Please explain what measures are contained within the category "other."  
 
Answer by European Union  
 
These amounts concerns m inor schemes concerning business set -up for young farmers and 
financial support related to exchange rate fluctuations.  
 
Follow -up: Australia was pleased to hear that the European Union was following Appellate Body's 
recommendation regarding what constitute d an eligible production  in the Korea Beef case. 
Argentina shared Australia's concern on the EU wine growing sector in question AG -IMS ID 83109.  
 
2.3.6   Jordan (G/AG/N/JOR/19, G/AG/N/JOR/20)  
AG-IMS ID 83087: Question by United States of America - Transparency is sues 
(including Table DS:2)  
According to the FAO 
(http://www.fao.org/giews/countrybrief/country/JOR/pdf_archive/JOR_Archive.pdf ), 
following the price hikes of 20 07/08, Jordan increased its strategic reserve of wheat 
from three to ten months of consumption in country and contracted or on the sea, equal 
to 450,000 MT in silos and 200,000  MT on sea and at the Aqaba port, as a precaution 
against future increases in fo od prices.  
 
According to U.S. data, as of 2015, Jordan continues its policy of maintaining strategic 
stocks at ten  months of consumption to avoid any shortages, equivalent to 400,000 MT 
in storage silos and 200,000 MT on sea and at port.  
 
a. Please confirm whether Jordan does maintain such reserves.  
b. How does Jordan acquire the wheat for strategic reserves?  What, if any, role 
does the market price support programme play in the acquisition?  
c. Does Jordan notify this measure in its domestic support notification?  If so, 
where?  If not, why?  
Answer by Jordan  
 
Jordan undertook to provide a response at a later stage.  G/AG/W/161  
 
- 54 - 
 
  AG-IMS ID 83089: Question by United States of America - Other product -specific 
AMS/EMS  
The United States seeks to gain a better understanding of Jordan' s programme for 
livestock feed subsidies. In response to AG -IMS ID77086, Jordan stated there is no 
limitation on the type of livestock eligible to receive subsidized feed under the 
Government feed sales measure notified.  In response to AGIMS 64071, Jordan states 
that this measure provides only feed barley and wheat bran to livestock.  According to 
the FAO 
(http://www.fao.org/giews/countrybrief/country/JOR/pdf_archiv e/JOR_Archive.pdf ), 
subsidized barley is distributed to herders according to actual numbers of tagged sheep 
and goats. It is the United States' understanding that upon the adoption of the animal 
tag system in 2007 by the Government of Jordan, only sheep a nd goat owners receive 
subsidized barley, and that the program me excludes cattle and poultry farmers from 
receiving the subsidy.  
 
a. Please confirm if this understanding is correct.  
b. Please clarify if livestock other than sheep and goats are included in the v alue 
of production figure for livestock.  
Answer by Jordan  
 
Jordan undertook to provide a response at a later stage.  
AG-IMS ID 83090: Question by United States of America - Non-product -specific AMS  
For non -product specific payments, what percentage of the producers are eligible to 
receive assistance?   
 
Answer by Jordan  
 
Jordan undertook to provide a response at a later stage.  
AG-IMS ID 83128: Question by Canada - Excessive rates of inflation  
Canada notes that Jordan has adjusted the fixed external referenc e price (FERP) for 
wheat in G/AG/N/JOR/19 and G/AG/N/JOR/20 however, in its earlier notification for 
calendar years 2011 and 2012 (G/AG/N/JOR/17) Jordan provided unadjusted figures in 
Supporting Table DS:5.  
 
Canada regrets that Jordan's most recent notifi cation is not as informative or 
transparent as its earlier one. Canada remains of the view that in accordance with 
paragraph 8 of Annex 3 of the Agreement on Agriculture the external reference price is 
fixed and unchanging. Where a Member's ability to resp ect its domestic support 
commitments is affected by excessive rates of infla tion, Canada notes that Article  18.4 
refers to the Committee on Agriculture to consider the resulting effects. The Central 
Bank of Jordan has not published its official inflation r ate figures for 2013 and  2014, but 
the World Bank reports inflation rates of 4.8% in 2013 and 2.9% in 2014. Could Jordan 
provide the official Bank of Jordan inflation rates for the years in question?  
 
Answer by Jordan  
 
Jordan undertook to provide a respo nse at a later stage.  
AG-IMS ID 83059: Question by New Zealand - Excessive rates of inflation  
New Zealand appreciates Jordan's commitment to transparency in submitting its most 
recent DS:1  notifications to the Committee on Agriculture for the years 2013 a nd 2014. 
New Zealand shares the concerns expressed in previous meetings of the Committee on 
Agriculture over how Jordan has adjusted its external reference price on the basis of 
"excessive inflation". New Zealand shares the view that Article 18.4 does not provide a 
methodology or a legal basis through which a Member's fixed external reference prices 
may be adjusted for inflation, and does not give any consideration for a methodology 
which would account for accumulated inflation after the reference period of  the fixed G/AG/W/161  
 
- 55 - 
 
  external reference price(s). Rather, under Article 18.4 it is Members (i.e. the 
Committee) that shall give due consideration to the influence of excessive rates of 
inflation on the ability of a Member to abide by its domestic support commitments .  
  
New Zealand notes that the footnotes in Supporting Table DS:5 for 2013 and 2014 state 
that the inflation rate in the two years was 77% based on average consumer price from 
1997 – 2013 and from 1997 to 2014 respectively (Jordan Central Bank, Statistics  
Department)". New Zealand therefore asks that Jordan submits amended notifications, 
and future notifications, with data that has not been adjusted for inflation; and submit 
supporting documentation, which can include domestic support data that has been 
adjusted for inflation, as well as other information pertaining to the nature and 
magnitude of inflation and demonstrating its impacts on the ability of the Member in 
question to abide by its domestic support commitments. As examples of what such 
supporting documentation may include, New Zealand recalls the communication from 
Canada, Argentina, Paraguay, Colombia, New Zealand and Norway on "Article 18.4 of 
the Agreement on Agriculture. Best practices in notification" (G/AG/W/122).  
 
Answer by Jordan  
 
Jordan u ndertook to provide a response at a later stage.  
AG-IMS ID 83088: Question by United States of America - Excessive rates of inflation  
The United States notes that Jordan adjusted its  Fixed External Reference Price  (FERP) 
for wheat in both 2013 and 2014, c iting a high level of inflation from 1997 
through  2014. The United States compared inflation rates of Jordan, as measured by the 
Consumer Price Index, with several other countries and aggregated groupings published 
by the International Monetary Fund. This data shows that Jordan's rates of inflation 
since 1997 and through 2015 are on par with that of the Middle East and North Africa 
region, below the average inflation of the world as well the Low and Middle Income 
grouping. Inflation, indexed to 1997 prices,  in fact shows that Jordan's level was below 
that of the OECD countries, including the United States, until the late 2000s. Further, the 
United States would note that Jordan's de minimis  level already largely takes into 
account inflation, since the de minimis is based on the value of production, which rises 
with higher inflation rates.  
 
a. Please explain what Jordan considers to be excessive inflation considering that, 
on average, Jordan's annual inflation rate was only 1.27 percentage points 
above that of th e United States for the 1997 -2015 period.  
b. Given that inflation is inherently taken into account by the de minimis  level and 
the above information, please explain Jordan's basis for asking Members to 
give Jordan "due consideration" due to existence of exces sive inflation.  
The United States notes that in Jordon's notifications it only includes an inflation 
adjustments in its market price support calculations in years Jordan would appear to 
have exceeded its Final Bound Total AMS commitment, which has not been  every year 
for wheat or barley. In fact, in Jordan's previous notification for 2011, neither barley nor 
wheat were adjusted, while both had been adjusted in 2009 and 2010.  
 
c. Does Jordan consider excess inflation to have not occurred for barley or wheat 
in 2009 or 2010?  
d. What steps has Jordan taken to maintain market price support measures that 
are within its WTO commitments and without the use of an inflation 
adjustment?  
The United States appreciates Jordan's past commitment to transparency in providing 
both unadjusted and adjusted numbers in its 2009 and 2010 notifications 
(G/AG/N/JOR/16) to the Committee for its review and consideration of the influence of 
excessive rates of inflation on the ability of Jordan to abide by its domestic support 
commitments.  
 G/AG/W/161  
 
- 56 - 
 
  e. The United States would appreciate it if Jordan would provide unadjusted 
numbers for its 2013 and 2014 notifications (G/AG/N/JOR/19 and 
G/AG/N/JOR/20).  
In response to AG -IMS ID 77085, Jordan noted that the quantity purchased by the 
Jordanian government un der the market price support schemes "must meet special 
standard and requirement, such as purity, injury percentage, and not all the quantity 
produced are purchased by government."  
 
f. Please confirm whether Jordan sets any predetermined limit on the quantity  of 
commodities to be purchased at the applied administered price.  
g. For barley and wheat in 2013 and 2014, please indicate the quantity of each 
produced nationally and the estimated quantity produced that meets the set 
standards referenced by Jordan.  
Answer  by Jordan  
 
Jordan undertook to provide a response at a later stage.  
 
Follow -up: Australia, the European Union, New Zealand, and the United States indicated interest in 
the subject of inflation and how it should be treated in domestic support notification s.  
 
2.3.7   Mali (G/AG/N/MLI/8)  
AG-IMS ID 83021: Question by European Union - Trans parency issues (including 
Table  DS:2)  
a. Input Subsidies:  
The European Union understands that Mali is supporting the use of certain 
inputs in agriculture, such as fertilizers, seeds a nd feedstuffs.  
i. Can Mali confirm that it is using such input subsidies and whether it intends 
to notify such Article 6.2 subsidies in a DS:2 notification?  
ii. Can Mali indicate the amount spent on these input subsidies each year?  
b. Cereals sold for food aid with  government subsidy:  
The European Union understands that legislation in place allows the 
government to sell subsidized cereals as food aid.  
i. Can Mali indicate whether such sales took place in the period covered by 
this notification?  
Answer by Mali  
 
Mali u ndertook to provide a response at a later stage.  
AG-IMS ID 83091: Question by United States of America - Transparency issues 
(including Table DS:2)  
The United States would like to note the steps taken by Mali over the past few years to 
bring its domestic support notifications up to date, and Mali's continued efforts to notify 
this Committee of its measures on a regular basis.  This step towards increased 
transparency is to be commended.  
 
The United States notes that Mali had a number of domestic support mea sures from 
2004 to 2012 (see notification G/AG/N/MLI/2), some of which included seeds, 
fertilizer, rural equipment; however, in subsequent years 2014 and 2015 in G/AG/W/161  
 
- 57 - 
 
  G/AG/N/MLI/7 and 2016 in G/AG/N/MLI/8, Mali notified no domestic support 
measures.  
 
a. To gain a better understanding of Mali's agricultural situation, please explain 
the reason for the elimination of all domestic support measures since 2012.  
The United States understands that, in 2015, a number of measures were approved by 
Mali's Council of Ministers . One example is the Ministry of Rural Development's 
Irrigation Development program me in the Bani Basin and Selingue with an objective of 
building hydro -agricultural infrastructure to allow for the development of land for 
agricultural production of crops i ncluding rice.  
 
b. Have any of these measures related to agriculture been implemented since 
being approved by the Council of Ministers?  
c. If so, in what year(s) did implementation of these measures begin?  
Answer by Mali  
 
Mali undertook to provide a response at  a later stage.  
 
2.3.8   Republic of Moldova (G/AG/N/MDA/6)  
AG-IMS ID 83092: Question by United States of America - Transparency issues 
(including Table DS:2)  
The United States would first like to recognize the work put in by the Republic of 
Moldova to bring its notifications up to date. Prior to January 2015, Moldova's last 
notification covered the period through 2004. Since then, the Republic of Moldova has 
brought its notifications up to date by providing more than a decade worth of data in the 
last two years. This is to be commended.  
 
a. The United States notes that in Moldova's first domestic support notification, 
the Republic of Moldova included the exchange rates for the local currency 
to SDRs. However, in Moldova's last two notifications, no exchange rate was 
provided.   
Please provide the annual exchange rates used to notify support in G/AG/N/MDA/6, as 
well as G/AG/N/MDA/3.  
 
b. In 2014 the Republic of Moldova notified, for the first time, "Expenditures for 
exceptional situations and mitigation of the consequence";  however, no 
Table  DS:2 notification has been submitted.  
i. When will the Republic of Moldova submit the DS:2 notification?  
ii. Please provide a brief description of this programme and how it meets the 
requirements of Annex 2 paragraph 8.  
Answer by the Republic o f Moldova  
 
a. 2005: 1 SDR=18,61 lei ;  
2006: 1 SDR=18,61 lei;  
2007: 1 SDR=18,58 lei ; 
2008: 1 SDR=16,41 lei ; 
2009: 1 SDR=17,12 lei ;  
2010: 1 SDR=18,87 lei ; 
2011:  1 SDR=18,53 lei ; 
2012: 1 SDR=18,63 lei ; 
2013: 1 SDR=19,13 lei ; 
2014: 1 SDR=21,33 lei ; 
2015: 1 SDR=26,32 lei . G/AG/W/161  
 
- 58 - 
 
  b.  
i. Notification Table DS:2 will be submitted within a short period.  
ii. Payments were provided to partially compensate the losses of fruit producers (apples 
and plums) as a consequence of the Russian Federation's embargo on fruit imports. 
This me asure is in line with Annex 2 paragraph 8. It was recognized by the 
government authorities as an emergency disaster situation as for this type of 
producers exports into Russian Federation accounted for more than 95% and export 
ban in the middle of the harv esting season (with no option of finding a new market 
within a few weeks period) would inevitably lead to financial failure of producers. The 
measure follows requirements of Annex 2 paragraph 8, as payments were given only 
with respect to losses of income and the payment has not exceeded the level of loss. 
Payments were given to compensate the cost of sale to processing plants.  
AG-IMS ID 83093: Question by United States of America - Public stockholding for food 
security purposes  
The Republic of Moldova main tains a state reserve for wheat as notified under Public 
Stockholding for Food Security. The United States appreciates the fulsome response 
provided by the Republic of Moldova in AG -IMS ID 69064.  
 
a. What are the predetermined targets for the quantities of wh eat that The 
Republic of Moldova will maintain in reserve?  
b. Noting Moldova's previous response, how often are the reserves renewed (i.e., 
how long is wheat usually kept in reserve before being replaced to ensure the 
appropriate quality)?  
Answer by the Repu blic of Moldova  
 
a. Requirements for these stocks are subject to governm ent Decision 128 of 
10 February  2009 on approval of Regulation of state cereal reserves. The maximum level 
of stocks is approved by the government based on the proposal of the Material  Reserves 
Agency and the Ministry of Agriculture and Food Industry, in coordination with the 
Ministry of Economy and the Ministry of Finance and other interested public institutions. 
At the s ame time, according to the Law N o. 245 of 27.1 1.2008 on State Sec ret, Article  7, 
the volume of state reserve is considered as state secret.  
b. The maximum t erm of storage is four  years.  
2.3.9   Russian Federation (G/AG/N/RUS/11)  
AG-IMS ID 83022: Question by European Union - Transparency issues (including Table 
DS:2)  
a. Recapitalis ation of RosSelkozBank and RosAgroLeasing: The 2016 OECD report 
on the Russian Federation notes the recapitalisation of the agriculture bank 
(RosSelkozBank) and the state agriculture leasing company (RosAgroLeasing). 
Have these financial institutions grant ed subsidies to farmers and are these 
subsidies included in the notification?  
b. Subsidy for fruit and vegetables: The notification does not mention any subsidy 
for fruit and vegetables, whilst the 2016 OECD report states that grants for 
setting up fruit and vegetable greenhouses, storage facilities and processing 
were available. Can the Russian Federation give more details about its support 
to fruit and vegetable producers and how this support is included in the 
notification?  
c. Wholesale and distribution centre s and domestic food aid system: the 2016 
OECD report also notes the availability of investment grants for setting up 
wholesale and distribution centres and domestic food aid systems. Was any 
support granted, and, if so, how is it included in the notificati on? G/AG/W/161  
 
- 59 - 
 
  Answer by the Russian Federation  
 
The Russian Federation undertook to provide detailed response at a later stage. The following is a 
preliminary response.  
 
The Russian Federation noted that it is not a Member of the OECD.   
 
a. All state agriculture su bsidies granted are included in the notifications in the section 
covering machinery and equipment support in Supporting Table DS:7. The OECD and 
WTO notifications are done with different classifications. RosSelkozBank and 
RosAgroLeasing are involved in the  process of agricultural machine crediting which 
relates to the issue of industrial subsidies. However some information is indicated in the 
machinery and equipment subsidies in the Russian Federation's DS notifications.  
b. The support provided to set up f ruit and vegetable greenhouses, storage facilities and 
processing is directly related to the machinery and equipment section of the notification.   
c. No support for the mentioned applications is carried out in the reported period.   
AG-IMS ID 83111: Questio n by Australia - Public stockholding for food security purposes  
Australia thanks the Russian Federation for its domestic support notification 
(G/AG/N/RUS/11). Can the Russian Federation outline the programmes included in the 
Public Stockholding for Securit y Purposes measure?  
 
Answer by the Russian Federation  
 
The establishment of reserves and stocks of agricultural products is aimed at ensuring food 
security of the Russian Federation and is not included in the system of measures of state support 
of agricult ure. A key goal of food security policies is to provide the population with high quality 
agricultural products including fish.Reserves and stocks placed in the federal system and regional 
farms guarantee access to these products. During the formation of th is fund, the government of 
the Russian Federation and the executive authorities of the constituent entities determine the 
annual volumes of agricultural products, raw materials and food required for the next five years. 
The resources of the federal farms a re used to meet the demand for agricultural products, raw 
materials and food stuffs in the far north and equated areas, ecologically contaminated territories, 
defense forces and state security and other similar special consumers regardless of their locatio ns. 
The city of Moscow and St. Petersburg are where regional farms are established to meet the needs 
of the constituent entities of the Russian Federation for agricultural products, raw materials and 
food. In addition for the purposes of food security, the  constituent entities of the 
Russian  Federation can establish additional regional reserves of agricultural products, raw 
materials and food.  
AG-IMS ID 83025: Question by European Union - Public stockholding for food security 
purposes  
State Grain Intervent ion from the Intervention Fund: Are funds for State Grain 
Intervention from the Intervention Fund included in the line on "Public stockholding for 
food security purposes" on  page 5?  
 
Answer by the Russian Federation  
 
The Russian Federation undertook to pro vide detailed response at a later stage. The following is a 
preliminary response.  
 
The relevant information is already included on page 5.  
 
AG-IMS ID 83026: Question by European Union - Direct payments: decoupled income 
support  
Could the Russian Federati on explain in more detail what types of decoupled payments 
are paid and in particular the eligibility criteria and conditions for farmers to receive 
such payments?  G/AG/W/161  
 
- 60 - 
 
   
Answer by the Russian Federation  
 
The Russian Federation undertook to provide a response at  a later stage.  
 
AG-IMS ID 83110: Question by Australia - Direct payments: payments for relief from 
natural disasters  
Australia thanks the Russian Federation for its domestic support notification 
(G/AG/N/RUS/11). Australia notes that there is a substantial  rise in payments for relief 
from natural disasters in the 2015 notification (USD  138.98 million in 2015 compared 
with USD  34.24  million in 2013).  
 
Can the Russian Federation:  
 
a. provide details for the events or circumstances behind this rise in spending;  
b. provide details of the program mes included in this measure  
Answer by the Russian Federation  
 
The amount of financing associated with the liquidation of the consequences of natural disasters 
depends on actual losses occurred as a result of emergency situa tions. In 2014, seven regions of 
the Russian Federation suffered from emergencies like droughts , floods, and hails and storms.  The 
year 2015 was marked by various emergency situations in 13 regions of the country, the vast 
majority of which suffered from d roughts. In addition some expenses are associated with the 
compensation for damages caused by emergency situations in 2014. Thus the increase in the 
amount of funding for addressing the consequences of natural disasters in 2015 in comparison 
to 2014 is cau sed by specific extreme weather events and not somehow connected to change in 
mechanism of state support and additional financing.   
AG-IMS ID 83024: Question by European Union - Other product -specific AMS/EMS  
a. "Milk - output subsidies": Is the subsidy to mi lk producers per liter of marketed 
milk included in the line "Milk - output subsidies" on p. 14 of the notification? 
Could the Russian Federation explain in more detail the types of subsidies 
granted at sub -federal levels?  
b. Support for "Pigs and poultry": N otified product specific AMS for pig and 
poultry gradually has decreased from US$ 208.14 million and US$ 82.76 million 
respectively in 2012 to US$  10.65  million and U S$ 7.67 million respectively 
in 2015. Could the Russian  Federation explain the reasons beh ind these 
decreases in support?  
Answer by the Russian Federation  
 
a. The Russian Federation undertook to provide detailed response at a later stage. The 
following is a preliminary response.  
b. The product -specific AMS decrease reflects the genuine  situati on in  the Russian 
Federation to decrease the product -specific support.  
AG-IMS ID 83023: Question by European Union - Non-product -specific AMS  
Interest subsidies: Between 2014 and 2015 Russia's non -product -specific AMS in the 
form of "Subsidies of interest  rate on short term credits and investment" decreased 
from USD 2,609.03 million to USD 1,419.63 million. The support in question was 
relatively stable during 2012 -2014. What are the reasons for this decrease in support?  
 
Answer by the Russian Federation  
 
The Russian Federation undertook to provide detailed response at a later stage. The following is a 
preliminary response.  G/AG/W/161  
 
- 61 - 
 
   
The decrease in support objectively reflects the situation of granting interest rate subsidies on 
short-term credits and investments.  
 
Follow -up: The United States  noted interest in these questions.  
 
2.3.10   Togo (G/AG/N/TGO/8)  
AG-IMS ID 83094: Question by United States of America - Input subsidies available to 
low-income or resource -poor producers  
The United States would like to recognize Tog o for the steps taken in recent years to 
bring its notifications up to date.   
 
Togo has notified subsidies for fertilizers classified as meeting the criteria of Article 6.2. 
Please explain how the fertilizer subsidy is implemented, how the monetary value 
notified is calculated, and how Togo defines "low -income or resource -poor producers."  
 
Answer by Togo  
 
Togo undertook to provide a response at a later stage.  
 
2.3.11   United States of America (G/AG/N/USA/109)  
AG-IMS ID 83036: Question by China - Transparency issues  (including Table DS:2)  
a. As the United States notified in its latest notification (G/AG/N/USA/109), the 
total amount of Amber Box subsidy is USD 13.6 billion, with a market price 
support of USD  1.5 billion for sugar. The 2012 Census of Agriculture shows tha t 
there were 2.1  million farms in total, among which, 788,310 farms had value of 
sales less than USD  2,500, 191,422 farms had value of sales between 
USD 2,500 to USD  4,999, 214,245 farms had value of sales between USD  5,000 
to USD 9,999, 244,954 farms had value of sales between USD 10,000 to 
USD 24,999, 152,873 farms had value of sales between USD 25,000 to 
USD 49,999, 129,366 farms had value of sales between USD  50,000 to 
USD 99,999, 232,955 farms had value of sales between USD 100,000 to 
USD 499,999, and 155,178 farms sold more than USD 500,000. Could the 
United States provide how much Amber Box subsidies each group of farms got 
in 2014?  
b. According to the notification mentioned above, USD 2.26 billion in total was 
provided for corn production in 2014, USD 956.4 million for cotton, 
USD 145.8  million for soybean, and USD 923.0 million for wheat. The 2012 
Census of Agriculture indicates that 348,530  farms of various scales were 
engaged in the production of corn for grain, 18,155 farms were engaged in 
cotton pr oduction, 302,963 farms were engaged in soybean production, and 
147,632 farms were engaged in the production of wheat for grain. Could the 
United States provide the amount of subsidies each group of farms got in 2014, 
by scale of farm size as listed in the  census?  
Answer by United States of America  
 
In response to both questions, the United States does not maintain this data.  
AG-IMS ID 83065: Question by Japan - Transparency issues (including Table DS:2)  
The budgetary outlays regarding the ALC and the PLC appear both in Supporting 
Table  DS:6 and Supporting Table DS:9. Could the United States provide information on 
what kind of difference exists between the ALC/PLC calculated as Product -Specific AMS 
and those counted as Non -Product -Specific AMS?  
 
Answer by Un ited States of America  
 G/AG/W/161  
 
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  ARC/PLC payments notified in Supporting Table DS:6 were made on generic base acres. Under the 
2014 Farm Act, historical cotton base acres were designated "generic base acres" and producers 
are eligible for payments, when triggered, under either the Agriculture Risk Coverage (ARC) or the 
Price Loss Coverage (PLC) programme if they plant a covered commodity (wheat, feed grains, 
soybeans, peanuts, other oilseeds, rice, and pulses) on those generic base acres. 
ARC/PLC  payments notified i n Supporting Table DS:9 were made on historical base acres of 
covered commodities with no requirement that the producer plant the historical commodity upon 
which payments are based or any other commodity.  
AG-IMS ID 83066: Question by Japan - Transparency i ssues (including Table DS:2)  
The price support for dairy products is  no longer  reported in this notification. Could the 
United States  explain how the stabilization of dairy prices and management of dairy 
farmers could be ensured?  
 
Answer by United States o f America  
 
The 2014 Farm Act repealed the Dairy Product Price Support programme, ending market price 
support for dairy. As a result, the United States no longer reports market price support for dairy. 
The United States continues to provide risk management programmes and livestock disaster 
assistance for dairy producers.  
AG-IMS ID 83112: Question by Australia - Market price support  
In Supporting Table DS:5 related to sugar market price support, the United States 
calculates its applied administered price on the basis of the average national loan rate 
for cane sugar – at 18.75  cents per pound. The United States sugar programme however 
supports the production of both cane and beet sugar. Australia notes that the national 
average beet sugar loan rate for 2014 wa s at the higher price of 24.09 cents per pound. 
Given that U.S. beet sugar regularly accounts for over 50% of U.S. sugar production 
(refer table 16 of US Sugar and Sweeteners yearbook tables 
https://www.ers.usda.gov/data -products/sugar -and-sweeteners -yearbook -tables/ ), 
why has the United States used the lower cane sugar loan rate as its applied 
administered price, and will the United States adjust its notification to take full account 
of the higher support price paid to beet sugar?  
 
Answer by United States of America  
 
The calculation in Supporting Table DS:5 reflects support provided to producers on a raw sugar 
basis. The U.S. commodity loan for cane sugar is imple mented at the processor level on raw cane 
sugar. The commodity loan for beet sugar is implemented at the processor level on refined sugar. 
The higher loan rate for beet sugar accounts for the additional processing costs between raw cane 
sugar and refined s ugar from sugar beets.  
AG-IMS ID 83113: Question by Australia - Market price support  
Australia thanks the United States for its domestic support notification 
(G/AG/N/USA/109), and welcomes the lower AMS spending recorded in Marketing Year 
2014. Australia notes that market price support for dairy fell by 99.6% in MY2014, with 
spending of USD  14.170 million, compared with USD  3,209.344 million in MY2013 and 
USD 3,335.804 million in MY2012. Can the United  States:  
 
a. explain the reason for this significant redu ction in spending in MY2014;  
b. the effect of the 2014 US Farm Bill on this amount;  
c. whether this lower spending will be sustained.  
Answer by United States of America  
 
The 2014 Farm Act repealed the Dairy Product Price Support programme, ending market price 
support for dairy. As a result, the United States no longer reports market price support for dairy. 
Expenditures under dairy program mes authorized by the 2014 Farm Act will vary by year, but the 
structure of the programmes will remain in place through the 20 18 programme year.  G/AG/W/161  
 
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  AG-IMS ID 83114: Question by Guatemala - Market price support  
Regarding Supporting Table DS:5 (Market Price Support), Guatemala has an interest in 
understanding the programme, which the United States has used for the first time and 
which  exceeds  the 5% de minimis .  
 
a. Guatemala  would appreciate if the United States  could advise whether this 
specific programme for sugar was used after 30  September  2015.  
b. Guatemala's understanding is that the United States is taking steps to avoid 
eroding the  domestic sugar market. Would the United States please indicate 
how this programme is intended to operate over the coming years?  
Answer by United States of America  
 
The 2014 Farm Act authorized the sugar programme through 2018.  
 
AG-IMS ID 83115: Question by Australia - Other product -specific AMS/EMS  
Notified AMS spending for livestock fell by 43.8% in MY2014, with spending of 
USD 922.986 million, compared with USD  1,641.985 million in MY2013 and 
USD 2,581.784 million in MY2012. Can the United States:  
 
a. explain the reason for this significant reduction in spending in MY2014;  
b. the effect of the 2014 US Farm Bill on this amount;  
c. whether this lower spending will be sustained.  
Answer by United States of America  
 
The largest share of spending in the livestock cate gory is for the Livestock Forage Program (LFP), 
a disaster programme that provides compensation to eligible producers for grazing losses due 
primarily to drought. The 2014 Farm Act provided for payments to cover losses incurred while the 
program me was susp ended between its expiration with the 2012 Farm Act and its reinstatement 
under the 2014 Act. Payments in marketing years 2012 and 2013 reflect losses incurred during a 
period of historic drought across large sections of the United States. Expenditures und er the 
programme will vary depending upon weather events that may trigger payments.  
AG-IMS ID 83117: Question by Australia - Other product -specific AMS/EMS  
Notified AMS spending for cotton rose by 66.8% in MY2014 to be USD956.408 million, 
compared with spe nding of USD573.534 million in MY2013. In MY2014 spending on 
cotton accounted for 15.5% of the value of cotton production. Can the United States:  
 
a. explain the reason for this significant rise in spending in MY2014;  
b. the effect of the 2014 US Farm Bill on t his amount;  
c. whether this higher spending will be sustained.  
Answer by United States of America  
 
Increased outlays under the marketing assistance loan programme are the primary reason for 
higher support in MY 2014. Expenditures under the marketing assistanc e loan programme will vary 
based on market conditions. The 2014 Farm Act adjusted the marketing loan rate to reduce its 
linkage to world prices by using a multi -year average price and applying a cap.  
AG-IMS ID 83070: Question by Brazil - Other product -specific AMS/EMS  
a. Notified product -specific AMS for cotton increased more than 65% from 2013 
to 2014, reaching a total of USD 956.4 million or 15% of the cotton's value of G/AG/W/161  
 
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  production. Could the United States explain the reason for such a significant 
increase i n AMS support provide for cotton producers?  
b. Notified product -specific AMS for soybeans decreased more than 90% from 
2013 to  2014, from USD 1.5 billion in 2013 to USD 145 million in 2014. Could 
the United States explain the reason for such a significant de crease in AMS 
support provide for soybeans producers?  
Answer by United States of America  
 
a. The increase in product -specific support is the result of increased benefits under the 
marketing loan assistance programme.  
b. The difference is the result of a decimal point error for the reported crop insurance 
premium subsidy. The correction changes that figure from USD 139.227 million to USD 
1,392.272 million, and raises the product specific AMS for soybeans from USD 145.792 
million to USD 1,398.838 million, w hich remains below the de minimis of USD 1,973.743 
million.  
AG-IMS ID 83130: Question by Canada - Other product -specific AMS/EMS  
In reviewing the United States' revised notification for 2008, Canada notes some 
reporting inconsistencies in Supporting Table DS:6 and DS:7 when compared to its 
previous notification G/AG/N/USA/77/Rev.1.  
 
a. In the United States' previous notification (G/AG/N/USA/77/Rev.1), 
Supporting Table  DS:6 listed an amount of USD 16.210 million for Livestock 
under the Livestock forage payment s (LFP). That programme is no longer listed 
in the newly revised 2008 notification but the amount of USD 16.210 million is 
now listed under the Livestock indemnity payments. Could the United States 
please explain this discrepancy?  
b. In the previous 2008 not ification (G/AG/N/USA/77/Rev.1) under Supporting 
Table DS:7, the amounts for the following products were listed under 
Commodity Loan Interest Subsidy. However, in the revised 2008 notification 
(G/AG/N/USA/77/Rev.2), they are now listed under Crop Insurance  Premium 
Subsidy:  
 Honey $0.101 million;  
 Lentils $0.008 million;  
 Mohair $0.001 million.  
Could the United States please explain this change?  
 
Answer by United States of America  
 
a. When the United States submitted G/AG/N/USA/77/Rev.2 to the WTO, the entry r ead 
"Livestock Forage Payment (LFP). " The entry should read "Livestock Forage 
Payment  (LFP) " and not "Livestock indemnity payments (LFP), " which is a typo.  
b. When the United States submitted G/AG/N/USA/77/Rev.2 to the WTO, the entry read 
"Commodity loan interest subsidy. " The entry should read "Commodity loan interest 
subsidy " and not "Crop insurance premium subsidy, " which is a typo.  
AG-IMS ID 83071: Question by Brazil - Classification of measures  
a. Could the United States explain why it has classified Agr iculture Risk Coverage, 
county based (ARC -CO) and Price Loss Coverage (PLC) payments as non -
product -specific AMS and how this classification is consistent with Article 1 of 
the Agreement on Agriculture which specifies that non -product -specific support 
is "support provided in favour of agricultural producers in general", particularly 
in light of the fact that there are distinct target prices for the different G/AG/W/161  
 
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  programme commodities and farmers were given the option to update their 
base -acres?  
b. Information ava ilable at the USDA website indicates that "[ARC -IC] payments 
are made on base acres in proportion to the planting of covered commodities 
on the farm". Could the United States explain the reason for payments under 
the ARC -IC were notified as non -product spe cific AMS if payments are made in 
proportion to the planting of covered commodities?  
Answer by United States of America  
 
a. ARC-CO and PLC payments are made on historical base acres with no requirement that 
the producer plant the historical commodity upon  which payments are based or any 
other commodity.  
b. ARC-IC payments are not specific to any one commodity as they are made on the 
combined revenues for all covered commodities on the farm.  
AG-IMS ID 83129: Question by Canada - Classification of measures  
Canada notes that the newly notified Price Loss Coverage (PLC) and County Agriculture 
Risk Coverage (ARC -CO) are notified as non -product specific in the United States' 2014 
notification. The United States Department of Agriculture (USDA) website describes  
these programmes as follows: The ARC -CO programme provides revenue loss coverage 
at the county level. ARC -CO payments are issued when the actual county crop revenue of 
a covered commodity is less than the ARC -CO guarantee for the covered commodity. The 
PLC programme payments are issued when the effective price of a covered commodity is 
less than the respective reference price for that commodity. The effective price equals 
the higher of the market year average price (MYA) or the national average loan rate f or 
the covered commodity.  
 
a. Given that ARC -CO and PLC cover specific commodities (i.e. Wheat, corn, grain 
sorghum, barley, oats, long grain rice, med. grain rice, soybeans, other 
oilseeds, peanuts, dry peas, lentils, small chickpeas and large chickpeas), 
payments are triggered based on the reference price and the historical planted 
acreage of those specific commodities, could the United States explain why 
these programmes were classified as non -product specific and not as product 
specific support?  
b. In addit ion, could the United States describe how these two programmes meet 
the criteria under Article 1 which states that non -product specific support is 
"provided in favour of agricultural producers in general"?  
Answer by United States of America  
 
a. and b. ARC -CO and PLC payments are made on historical base acres with no 
requirement that the producer plant the historical commodity upon which payments are 
based or any other commodity. Therefore, they are not specific to a commodity.  
AG-IMS ID 83027: Question by  European Union - Classification of measures  
a. Agriculture Risk Coverage, county -based (ARC -CO): The United States notifies 
Agriculture Risk Coverage, county -based (ARC -CO), Price Loss Coverage (PLC) 
and Agriculture Risk Coverage, individual farm (ARC -IC) pr ogrammes in Table 
DS:9 under non -product specific AMS. However, as explained under the 
comments column, these programmes are specific to certain commodities - 
wheat, feed grains, soybeans, peanuts, other oilseeds, rice, and pulses. In the 
light of this, co uld the United States explain why it has not instead notified the 
spending under these programmes as product specific AMS for each product 
benefitting from the programmes? According to Article 1(a) of the Agreement 
on Agriculture, non -product specific AMS is provided in favour of agricultural 
producers in general, which does not appear to be the case with the 
programmes in question, as all products concerned have specific trigger levels G/AG/W/161  
 
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  (i.e. reference prices for the PLC programme; and crop revenue in case of the 
ARC programme) as a basis for programme spending.  
b. Dairy Product Donation Program: According to the information provided by the 
United States, the "Dairy Product Donation Program" is "triggered to last for 
one month following a period of two consecu tive months during which the dairy 
margin (the difference between milk price and feed costs as determined by 
FSA) falls below $4.00 per hundredweight." This trigger appears to provide an 
incentive for dairy producers to keep up production levels during per iods of 
relatively low profitability. How does the United States consider this to meet 
the general criteria of Annex 2 of the Agreement on Agriculture of having "no, 
or at most minimal, trade -distorting effects or effects on production"?  
Answer by United S tates of America  
 
a. ARC-CO and PLC payments are made on historical base acres with no requirement that 
the producer plant the historical commodity upon which payments are based or any 
other commodity. Therefore, they are not specific to a commodity. ARC -IC payments are 
also not specific to any one commodity as they are based on the combined revenues for 
all covered commodities on the farm.  
b. The Dairy Product Donation Program makes purchases of dairy products through 
competitive bids at current market pr ices. Purchases are made in consultation with the 
Food and Nutrition Service to ensure that they meet the needs of low -income 
populations served by nutrition assistance program mes. 
Follow -up: China noted that the United States implemented  agricultural poli cies that influenced the 
functioning of the world market. China noted the two major changes in U.S. agricultural subsidy 
policy since the entry into force of t he WTO agreements 20 years ago:  one in 1996 introducing 
Green Box direct payments and CCP, and th e other one in 2014 repeal ing direct payments and 
CCP and introducing PLC and ARC. China noted that these po licy changes were useful for ass essing 
the effectiveness of the AoA since they provided a sample for evaluating to what extent the 
current disciplin es helped to achieve the long -term objective as set out in the Punta del Este 
Declaration. China however expressed disappointment regarding the difficulty to obtain reliable 
information on U.S. policies. As an example, China cited some statistics it had obtained from a 
website of a non -profit organization dedicated to protecting human health and environment. China  
suggested the United States share information in formal channels such as the CoA.  
 
2.4  NEW OR MODIFIED DOMESTIC SUPPORT MEASURES (DS:2)  
2.4.1   Canada (G/AG /N/CAN/114)  
AG-IMS ID 83095:  Question by United States of America - Transparency issues 
(including Table DS:2)  
a. Regarding the AgriMarketing programme on page 4, there are two funding 
streams that have not yet been operationalized – breaking down trade barri ers 
and building market success.  
i. What is the timing for these funding streams to be operationalized?  
ii. Please provide more information about the objectives and design of these 
funding streams?  
b. The United States takes note that certain elements of the follow ing 
programmes were not included in the Green Box because they did not meet the 
criteria for exemption: Market Development projects in Ontario (p. 14), 
Growing Competitiveness (Manitoba) (p. 15), Growing Assurance (Manitoba) 
(p. 19), and Ontario Foods (p. 24). 
i. Where are the direct payments for these program mes notified in 
G/AG/N/CAN/113? The entry for Growing Competitiveness refers to G/AG/W/161  
 
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  relevant figures reported as non -product -specific support, but there is no 
explanation for the other programmes.  
ii. Are there a ny other program mes in Growing Forward 2 that have some 
elements notified as Green Box and other elements notified as Amber Box?  
Answer by Canada  
 
a.  
i. These funding streams were operationalized on 1 April 2013.  
ii. This funding is to support departmental acti vities of the Federal Government's work 
under Growing Forward 2 such as market research, Canada Brand tools, and the 
work of Agriculture and Agri -Food Canada's Market Access Secretariat. They are not 
related to the provincial program mes noted by the United  States. Stream A: 
Breaking Down Barriers to Trade aims to enhance AAFC's market access capacity in 
order to gain, maintain and regain access to priority markets. This stream supports 
Canada's animal and plant health and food safety systems, as well as adv ocacy for 
more open, science -based international standards and policies. In addition, Stream A 
aims to increase bilateral engagement with trading partners to reduce irritants to 
trade arising from the imposition of non -tariff barriers and to provide new av enues 
for their resolution. Stream B: Building Market Success aims at assisting and 
preparing industry to seize market opportunities and maximize market performance 
both domestically and internationally (e.g., market intelligence reporting, assist 
industry  in entering new markets, Trade Commissioners, Trade shows. Canada 
Brand)  
b.  
i. The payments are included in Supporting Table DS:9 under "provincial programmes ". 
ii. Growing Forward 2 is a federal -provincial -territorial policy framework that 
encourages innovati on, competitiveness and market development in Canada's 
agriculture and agri -food sector. Growing Forward 2 enables the sector to innovate 
and capitalize on emerging market opportunities. Resources within these areas of 
focus are available to eligible produ cers, processors, organizations and 
collaborations. These cost -shared programmes provide flexibility to provinces and 
territories to design and deliver programmes that address their regional needs. Given 
the variability of regional needs a programme may in clude a number of separate 
measures to address specific circumstances. As noted, G/AG/N/CAN/114 includes 
information that is not appropriate for a Table DS:2 notification. Canada intends to 
submit a revision in the near future.  
2.4.2   European Union (G/AG/N/EU/3 5) 
AG-IMS ID 83116: Question by Guatemala - Transparency issues (including Table DS:2)  
Producers are eligible for the European Union's domestic support programmes, in 
particular the Basic Payment Scheme. Please clarify the following:  
 
a. Are producers eligib le for various payments under the BPS, i.e. the greening 
payment, the payment for young farmers and the redistributive payment, or are 
they entitled to only one payment under the BPS?  
b. Under the Young Farmers Payment Scheme, young producers receive support  
for a maximum of five years. Could the European Union please specify the 
minimum and maximum amounts granted per producer, on an annual basis or 
the maximum amount for the five years?  G/AG/W/161  
 
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  c. Are the EU programmes inclusive or exclusive, i.e. may the producers o pt for 
various programmes at the same time, for example the BPS and rural 
development programmes?  
Answer by European Union  
 
a. Member States can combine different direct payment schemes to ensure efficient 
support to farmers, adapted to their national cont ext. Some are compulsory for member 
States (the basic payment, the greening payment and the young farmer payment) and 
some are optional (the redistributive payment, the small farmer scheme, the voluntary 
coupled support, the payment for areas with natural constrains).  
The schemes can indeed be cumulative for the farmers, but what the farmer can get 
depends:  
 on the choices of member States whether to implement the optional schemes;  
 if the farmer is eligible for each the individual scheme.  
For example, all el igible farmers receive the basic payment and greening payments 
(subject to respect of the greening requirements), whilst some farmers may also qualify 
for a further payment under the compulsory young farmers scheme, and, depending on 
member State choices, a possible additional payment under one or more of the 
voluntary schemes.  
b. Support under the Young Farmers Scheme is granted as a top -up per hectare. The exact 
amount of the top -up differs per member State, but is generally calculated as 25% of 
the basic  payment or of the total direct payments per hectare. The total amount per 
farmer depends on the number of hectares declared, subject to the threshold.  
c. Direct payments and rural development measures are not exclusive to one another. For 
example, farmer s can on the one hand get the basic payment, the greening payment 
and additional payments under the rural development programmes (investment aids, 
agri-environmental measures, etc.). on the condition of their eligibility for each schemes.  
However, the gene ral principle of no -double funding must be respected. Three articles of 
Regulation 1305/2013 mention explicitly the obligation to exclude double funding due to 
a possible overlap with greening payments in Pillar I of the CAP: Articles 28, 29 and 30. 
These articles refer to agri -environment -climate (AEC), organic farming, and 
compensation payments for extra cost resulting from Natura 2000 and the Water 
Framework Directive (WFD) respectively.  
AG-IMS ID 83097: Question by United States of America - Transparen cy issues 
(including Table DS:2)  
It is noted that various measures, including those notified as Rural Development by the 
European Union, include provisions that, to varying degrees, allow member States to 
"design their own multi -annual programmes on the basis of the EU Legal 
framework  set".  
 
What specific steps does the European Union take to ensure measures are implemented 
in a manner compatible with WTO obligations as notified?  
 
Please explain how this process of review is carried out by the European Unio n. Has the 
European  Union ever required a member State to modify a programme to come into 
compliance with the European Union's WTO obligations?  
 
Answer by European Union  
 
The EU legal framework set for the period 2014 -2020 has been designed to ensure compa tibility 
with relevant WTO rules. Compliance by member States with the EU legal framework for Rural 
Development Programmes is assessed in the following way:  G/AG/W/161  
 
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 The Commission assess the consistency of rural development programmes with the EU legal 
framework at the moment of adoption and modification of programmes and can make 
observations to member States. In this case, the latter have to provide all necessary 
information and, where appropriate, revise the proposed programmes or programme 
modifications. The C ommission only approves the programmes and their modifications once 
the respective observations have been adequately taken into account.  
 The Commission organises on -the-spot checks in member States with a view of verifying, 
amongst other issues, compliance  with EU rules and the terms on which operations were 
undertaken and checked by member States. Where it finds that expenditure has not been 
incurred according to EU law, the Commission may decide to refuse EU financing depending 
on the gravity of the non -conformity recorded.  
Payments to areas facing natural or other specific constrains provide an example where the 
Commission required member States to modify a programme to comply with WTO rules. At the 
moment of approval of the Rural Development Programmes 2 014-2020, the Commission made 
observations to member States in relation to many programmes to ensure, for instance, that 
support was available to all producers in the delimited area, and that support could not be focused 
on specific types of farming.  
AG-IMS ID 83098: Question by United States of America - General services: pest and 
disease control  
The EU notification of "Management of expenditure relating to the food chain, animal 
health and animal welfare, and relating to plant health and plant reproductiv e material" 
states that these expenditures are exempt under Annex 2 paragraph 2(b) (e.g., "pest 
and disease control").  The notification states "payments related to the food chain, 
[etc…]." Please explain how payments are made related to the food chain and how they 
meet the criteria of Annex 2 paragraph 2(b).  
 
Answer by European Union  
 
While the Regulation concerned includes some rules on food chain, the expenditure is only related 
to pest and disease control and these will be notified as Green Box measures,  as these costs 
respect the criteria in Annex 2, paragraph 2 (b) of the Agreement on Agriculture, as was the case 
under previous EU legislation.  
AG-IMS ID 83121: Question by Australia - Direct payments: decoupled income support  
Australia thanks the Europ ean Union for its domestic support notification for new 
measures (G/AG/N/EU/35). Australia notes that in order to receive the 'greening' direct 
payments under the 2013 Cap Reform, there are 'three obligatory agricultural practices, 
namely maintenance of pe rmanent grassland, ecological focus areas and crop 
diversification', with the crop diversification criteria related to production. Can the 
European Union please provide information on:  
 
a. how this measure is non -trade distorting given the crop diversificati on criteria 
are related to production;  
b. the relationship between the payments made to farmers versus the cost to 
farmers to undertake this 'greening' activity, and how this amount was 
decided.  
Answer by European Union  
 
a. The crop diversification measure is  not production or trade -distorting since payment is 
not linked to the production of any specific products or to price support. Farmers have a 
free choice as regards crops or land coverage in order to fulfil the crop diversification 
criteria. Farmers decid ing not to produce any crop by leaving land fallow will be 
considered as fulfilling the obligation and will get the payment.  G/AG/W/161  
 
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  b. There is no direct link between the amount of decoupled direct payment and the actual 
effort required by the farmer since this payment is a decoupled income support a certain 
share of which (30%) is dependent on the fulfilment of a set of production methods 
criteria. The percentage was fixed in order to ensure the effectiveness of the scheme and 
to have a sufficient deterrent effe ct in case of non -compliance by farmers.  
AG-IMS ID 83118: Question by Australia - Other  
Australia thanks the European Union for its domestic support notification for new 
measures  (G/AG/N/EU/35). Australia is interested in more information on the Rural 
Deve lopment programmes under the 2013 CAP Reform measure. Can the European 
Union provide information on:  
 
a. the specific Rural Development programmes included in this measure;  
b. the criteria for accessing these programmes;  
c. the areas and people eligible to access these programmes.  
Answer by European Union  
 
A member State may submit either a single programme for its entire territory or a set of regional 
programmes. Alternatively, in duly justified cases, it may submit a national programme and a set 
of regional progr ammes. There are 118 different rural development programmes in the 
28 member States for this period, with 20 single national programmes and eight member States 
opting to have two or more (regional) programmes.  
 
The full text of the programmes, as well as s ummary factsheets are available at the following link:  
https://ec.europa.eu/agriculture/rural -development -2014-2020/country -files_en . 
 
The criteria for accessing  the programmes are not globally defined at programme level. Eligible 
beneficiaries, eligible costs and eligibility conditions vary depending on the specific form of support 
("rural development measures") made available to final beneficiaries. Detailed inf ormation on the 
conditions for support under each rural development measure can be found in the text of each 
programme. The conditions for support must comply with the EU legal framework set for the 
period 2014 -2020 (including the specific Rural Developmen t Regulation (EU) 1305/2013), which 
has been designed to ensure compatibility with relevant WTO rules.  
AG-IMS ID 83119: Question by Australia - Other  
Australia thanks the European Union for its domestic support notification for new 
measures (G/AG/N/EU/35) . Regarding the crop specific payment for cotton notified as 
an Article 6.5 measure under the 2013 CAP Reform measure, can the European Union 
provide information on:  
 
a. how the production of cotton provides a benefit 'in regions of the European 
Union  where it is important for the agricultural economy', compared with the 
production of another commodity;  
b. which areas are eligible to receive this 'aid'?  
Answer by European Union  
 
The crop -specific payment for cotton was established to meet the objectives set out  in paragraph 2 
of Protocol 4 of the Act of Accession of Greece: to support the production of cotton in regions of 
the Community where it is important for the agricultural economy, to permit the producers 
concerned to earn a fair income, and to stabilise t he market by structural improvements at the 
level of supply and marketing. Notably, in the two main cotton producing countries (Greece and 
Spain) the cotton sector is important for the local economy, especially in terms of employment, 
and there are no othe r viable crop alternatives. Extensive economic data proving the importance of 
the cotton sector in these countries can be found at the following internet site: 
https://ec.europa.eu/agriculture/evaluation/market -and-income -reports/cotton2014_fr . 
 G/AG/W/161  
 
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  Concerning the eligibility of areas, Article 57 (1) of Regulation (EU) No 1307/2013 provides for the 
crop-specific payment for cotton to be granted per hectare of el igible area of cotton and that the 
area is eligible only if it is located on agricultural land authorised by the member State for cotton 
production, sown with varieties authorised by the member State and actually harvested under 
normal growing conditions. For the specific procedure to authorise the land , see answer to 
question  AG-IMS ID 83096.  
AG-IMS ID 83120: Question by Australia - Other  
Australia thanks the European Union for its domestic support notification for new 
measures (G/AG/N/EU/35).  Australia  is interested in more information on the 
Voluntary Coupled Payments notified as an Article 6.5 programme under the 2013 CAP 
Reform measure. Can the European Union provide information on:  
 
a. specific program mes included in this measure;  
b. the criteria applied t o these program mes  
c. how these program mes limit production, noting that the measure states that 
'payments shall be granted to the extent necessary to create an incentive to 
maintain current levels of production.'  
Answer by European Union  
 
The conditions fo r voluntary coupled support are general conditions designed to ensure compliance 
with Article 6.5 Blue Box rules. Each must be respected if a member State decides to grant 
voluntary coupled support. Accordingly, all these conditions apply to each individua l measure:  
 
 The intended support measure can only support farmers in one of the 21 potentially eligible 
sectors.  
 A sector can only be supported if a member State justifies that the producers in that sector 
undergo difficulties (e.g. weak profitability), due to which there is a risk of decline or 
abandonment of production.  
 In addition, the member State also needs to justify the importance of the targeted sector 
from economic/social/environmental point of view (for example, if the targeted sector is an 
important employer in the targeted region, in which unemployment is already high).  
As for the specific measures in each of the potentially eligible sectors, an overview of the 2014 
member State decisions on voluntary coupled support in 2014 can be found on t he following sites:  
 
 https://ec.europa.eu/agriculture/sites/agriculture/files/direct -support/direct -
payments /docs/voluntary -coupled -support -note_en.pdf  
 https://ec.europa.eu/agriculture/sites/agriculture/files/direc t-support/direct -
payments/docs/voluntary -coupled -support -note-2_en.pdf   
AG-IMS ID 83096: Question by United States of America - Other  
a. The European Union's notification of Voluntary Coupled Support (VCS) explains 
that the level of support is limited, and t hat payments are based on a fixed area 
and yields or on a fixed number of animals; however, it is unclear what 
measures are taken to limit quantity of production.  Further, it is noted that 
"Payments shall be granted to the extent necessary to create an inc entive to 
maintain current levels of production".  
i. Please explain how VCS meets the production -limiting criteria of Article 6.5 
of the Agreement on Agriculture, including the steps taken to ensure 
producers benefiting from the programme do not expand produc tion.  
ii. Please describe how payments are calculated, including any relevant 
formulas used in calculating support levels.  G/AG/W/161  
 
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  b. The European Union's Crop specific payment for cotton is notified as meeting 
the criteria of Article 6.5 and must therefore include crit eria to limit 
production.  The European Union's notification appears to state that production 
vis-à-vis area can be expanded beyond base levels and continue to receive 
payments albeit at a reduced rate.  
i. Please explain how the crop specific payment for cotto n meets the 
production -limiting criteria of Article 6.5, including the steps taken to 
ensure producers benefiting from the programme do not expand 
production.   
ii. Please describe how payments are calculated and provide any relevant 
formulas used in calculatin g support levels.  
iii. How are authorized lands determined by member States for purposes of this 
measure?  
Answer by European Union  
 
a. i and ii.  
Per unit amount:  
As explained in the notification on Article 6.5 Blue Box, for each measure, the member 
State must justify the support needed in light of the difficulty that the targeted sector or 
type of farming undergoes. Based upon this difficulty and in light of the objective of 
Voluntary Coupled Support (i.e. maintenance of production) the 'estimated per unit 
amou nt' of each coupled support measure is determined.  
Quantitative limit:  
this limit (expressed in hectares or animals) is based on the production in the five years 
preceding the year in which the member State made its decision to grant coupled 
support (Art icle 53(2) of Commission Delegated Regulation  (EU) No 639/2014).  
Actual production (in hectares or animals) benefitting from support is checked against 
this limit. Financial ceilings for the voluntary coupled support measures are set as 
follows: Estimated per unit amount x quantitative limit = financial envelope  
b. i. and ii.  
The limitation of eligible production is achieved through a system of base areas, fixed 
yields and reference amounts set out in Article 58 of Regulation (EU) No 1307/2013 as 
follows:  
"1. The following national base areas are established:  
Bulgaria: 3 342 ha ; 
Greece: 250 000 ha ; 
Spain: 48 000 ha ; 
Portugal: 360 ha.  
2. The following fixed yields in the reference period are established:  
Bulgaria: 1,2 tonne/ha ; 
Greece: 3,2 tonne/ha ; 
Spain: 3 ,5 tonne/ha ; G/AG/W/161  
 
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  Portugal: 2,2 tonne/ha.  
3. The amount of the crop -specific payment per hectare of eligible area shall be 
calculated by multiplying the yields established in paragraph 2 with the following 
reference amounts (per tonne):  
Bulgaria: EUR 584,88 in 2015; and EUR 649,45 for 2016 and onwards ; 
Greece: EUR 234,18 ; 
Spain: EUR 362,15 ; 
Portugal: EUR 228,00.  
4. If the eligible area of cotton in a given member State and in a given year exceeds the 
base area established in paragraph 1, the amount referred to i n paragraph 3 for that 
member State shall be reduced proportionately to the overrun of the base area".  
The fixed yield established per producer member State, together with the base area 
requirement determines the overall capping of the funds and the progra mme production 
limiting character while at the same time fulfilling the objectives of Protocol 4 of the Act 
of Accession of Greece.  
Cotton production ceased in Portugal in 1996 and in Bulgaria, cotton is produced on less 
than 1 000 ha.  
iii. The procedure is set out in in Article 56 of Commission Delegated Regulation (EU) No 
639/2014 as follows:  
"Member States shall establish objective criteria on the basis of which agricultural land is 
authorised pursuant to Article 57(2) of Regulation (EU) No 1307/2013.  
Those criteria shall be based on one or more of the following:  
 
a) the agricultural economy of those regions where cotton is a major crop;  
b) the soil and climate in the areas in question;  
c) the management of irrigation water;  
d) rotation systems and culti vation methods likely to respect the environment."  
AG-IMS ID 83131: Question by Canada - Classification of measures  
On page 7 of the European Union's DS:2 notification, the European Union reports 
different elements/measures of the new rural development pro grammes under 
paragraph 7, Annex 2, i.e., risk management and income stabilisation tool. Information 
provided in the following document http://capreform.eu/use -of-risk-management -
tools -in-the-cap/ entitled "Use of risk management tools in the CAP", states that 
although conditions set out in the Regulations for the above mentioned program mes 
meets the policy specific criteria of Annex 2, the Guidelines for State Aid removes the 
threshold for losses. As a result, the author suggests that these State payments would 
no longer meet the policy specific criteria of Annex 2.  
 
a. Could the European Union provide details on if/how the risk management and 
income stabilization tools differ at the State level from those of European 
Union?  
b. If changes are made at the State level that would modify the criteria for a 
payment from the EU Regulation, how would state level program mes be treated 
in the European Union's DS:1 notifi cation?  
Answer by European Union  
 G/AG/W/161  
 
- 74 - 
 
  a. European Union will not comment on articles.  
 EU rules on State Aid granted in the agricultural sector are to a large extent aligned with 
EU Rural Development rules, but they are not identical. For example, the EU Rural 
Development Regulation provides for an income stabilisation tool but the State Aid rules 
do not. As regards other risk management measures, the conditions for granting aid are 
not exactly the same and are not required to do so. The European Union notifies support 
in the appropriate Boxes.  
b. Member States cannot legally change criteria set out EU law.  
Subsidies must either be provided for in EU law or must be in compliance with EU State 
Aid rules. These are communicated to the EU by member States in a transparent manner 
according to EU law.  
Follow -up: Norway noted that the increased flexibility in polic y design provided for EU member 
states in the revised Common Agriculture Policy was an interesting development. The European 
Union informed Members of its upcoming domestic support notification for 2014 -2015. Australia 
looked forward to the notification.  
 
2.4.3   Mexico (G/AG/N/MEX/33)  
AG-IMS ID 83072: Question by Ukraine - Domestic food aid  
Regarding the three domestic food aid programmes in G/AG/N/MEX/33, could Mexico 
please provide additional background information to these following points:  
 
a. Do targeted househ olds or populations have access to all three programmes? If 
yes, can Mexico provide a sense of the degree of overlap?  
b. Does legislation or other implementing regulations provide more details 
relative to the nutritional objectives in terms of clearly -define d criteria? Can 
Mexico please provide a summary of these nutritional objectives for each 
programme?  
Answer by Mexico  
 
a. Yes, the Rules of Operation for each of the programmes do not exclude the possibility 
that programme beneficiaries may access the thre e types of aid simultaneously. It 
should be noted, however, that the aim of this overlap is not to allow for the repetition 
or accumulation of benefits, but to ensure complementarity between programmes so as 
to cover the greatest number of beneficiaries.  The Rural Supply Programme, for 
instance, focuses on areas with a population of less than 15,000 inhabitants, while the 
Milk Supply Programme targets urban areas. In both cases, the support allows 
beneficiaries to purchase staple food products at prices low er than those of private 
commercial establishments. The Food Support Programme provides financial aid through 
cards that are used to purchase basic commodities. It operates in both urban and rural 
areas, and targets the most vulnerable households.  
Accordin g to the most recent quantitative study  available (Morales -Ruán et 
al, 2013)3 based on data from the 2012 National Health and Nutrition Survey, the Milk 
Supply Programme covered 10.8 % of households in urban areas (2,494,000 households) 
and 5.8 % in rural ar eas (366,800 households). The Food Support Programme 
covered  2% of urban households (462,000 households) and 2.2 % of rural households 
(139,300  households). This means that even where all Food Programme support 
recipients also receive support under the Milk  Supply Programme, the number of 
                                                
3 Morales -Ruán, M. C., T. Shamah -Levy, V. Mundo -Rosas, L. Cuevas Nasu, M. Romero, S. Villalpando 
and J. A. Rivera -Donmarco (2013), "Programas de ayuda alimentaria en México, cobertura y focalización" 
("Food aid programmes in Mexico, coverage and focus"), Salud Pública de México , Volume 55, Supplement 2, 
pp. S199-S205.  G/AG/W/161  
 
- 75 - 
 
  households benefiting from both programmes would be 601,300 (462,000  + 139,300), 
which amounts to 2 % of all households in the country.  
Given that in the case of the Rural Supply Programme, points of sale are located mainly 
in rural areas, the maximum number of beneficiary households covered by this 
programme and by the Milk Supply Programme would be 366,800, while a maximum of 
139,300 households would potentially benefit from the three programmes.  
b. The regulations determin ing the nutritional criteria to be met by persons or households 
benefiting from food aid programmes, and the objectives pursued via their 
implementation, are set forth in these programmes' Rules of Operation, as supplemented 
by the Result Indicator Matrix.  
The aim of the Food Support Programme is to improve access to food for families whose 
estimated per capita monthly income is below the minimum level of wellbeing ( Línea de 
Bienestar Mínimo , LBM). The LBM corresponds to the income needed to purchase a basi c 
food basket per person, per month, in Mexico. According to the National Council for 
Social Development Policy Evaluation (CONEVAL), families whose income is below the 
LBM are living in a state of food poverty and require support.  
In order to establish wh ether or not a family meets the requirements for accessing the 
aid, families in each of the places where the Food Support Programme operates are 
assessed on the basis of the One -Time Socio -Economic Information Questionnaire 
(CUIS), which includes a set of basic questions on a family's social and economic 
characteristics. Thanks to this questionnaire, it is possible to determine whether a 
family's income is lower that the LBM; if it is, the family's name is added to the 
programme's list of beneficiaries.  
According to the Food Support Programme Result Indicator Matrix, the quantitative 
indicators relating to the fulfilment of this programme's objectives are: 
(1) the proportion of children under five years of age suffering from chronic malnutrition; 
(2) the pre valence of anaemia in children under five years of age; (3) the proportion of 
children from 0 to 11 years of age who are overweight or obese; (4) the total number of 
households and individuals living in a secure food situation.  
The Rural Supply Programme a lso seeks to ensure people's right to access food. Given 
that the population in highly and very highly marginalized areas has insufficient access 
to quality staple products and that its ability to purchase such products is low due to its 
level of income, t he programme's points of sale are located specifically in these types 
of area. 
Support under the Rural Supply Programme is targeted in two stages. The first stage 
involves selecting the recipient areas. As mentioned above, the aim here is to focus 
resource s on the most marginalized areas. The marginalization index is established by 
the National Population Council (CONAPO) using the methodology described in the 
following link:  
http://www.conapo.gob.mx/work/models/CONAPO/Resource/1755/1/images/IAM_05Ane
xo.pdf  
Once the areas have been chosen, the second stage involves selecting the beneficiary 
families, once again using the CUIS. According to the Rural Supply Progr amme Result 
Indicator Matrix, the quantitative indicator used to measure the impact of this support is 
the proportion of people surveyed in the area that have "access to food". This concept is 
defined on the basis of the following criteria established by C ONEVAL:  
Access to food: the indicator is constructed using the Mexican Food Security 
Scale  (EMSA), which is obtained by asking each household if, in the last three months, 
due to a lack of money or resources, any member of the household: (1) subsisted on a  
diet consisting of a very small variety of foods; (2) stopped eating breakfast, lunch or G/AG/W/161  
 
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  dinner; (3) ate less than they thought they should eat; (4) went without food; (5) was 
hungry but didn't eat; or (6) ate once a day or did not eat for an entire day.  
The Rules of Operation for the Milk Supply Programme also define this programme's 
objective as to contribute to effectively ensuring the social right to food, facilitating 
access to quality fortified milk for people whose income is below the LBM. The CUIS is 
once again used to determine whether people are living below the LBM.  
According to the Milk Supply Programme Result Indicator Matrix, the quantitative 
indicator used to measure the effectiveness of the support is the infant population 
suffering from mal nutrition, defined as (1) the proportion of children under five years of 
age suffering from chronic malnutrition; (2) the prevalence of anaemia in children under 
five years of age; (3) the pro portion of children from 0 to eleven  years of age who are 
overwe ight or obese; (4) the total number of households and individuals living in a 
secure food situation.  
In short, the three programmes in question, according to their Rules of Operation, 
establish clearly defined criteria for entitlement to support: generally  speaking, 
beneficiaries must have a level of income below the LBM and/or live in highly or very 
highly marginalized areas. In both cases, criteria and quantitative methodologies have 
been clearly established by both CONAPO and CONEVAL.  
There is also a cle arly defined nutrition -related objective, namely to ensure the social 
right to food. The fulfilment of this objective is, for practical purposes, reflected in easily 
measured quantitative indicators in the Result Indicator Matrices for each of the 
programm es. 
AG-IMS ID 83132: Question by Canada - Direct payments: structural adjustment 
assistance provided through investment aids  
Based on an online description of the Productive PROAGRO programme linked to the 
SAGARPA website, the main objective of this progra mme is to: "Contribute to increasing 
production and productivity of agricultural rural economic units through incentives for: 
the integration of production chains (product systems), development of agro clusters; 
investment in physical, human and technologi cal capital, productive restructuring, 
agricultural inputs, post -harvest management, efficient use of energy and sustainable 
use of natural resources." In Mexico's current DS:2  notification (G/AG/N/MEX/33), this 
programme is classified as Green under parag raph 11, Annex 2, of the Agreement on 
Agriculture.  
  
In light of the change under the Productive PROAGRO programme so that it now aims to 
contribute to increasing production and productivity could Mexico please provide details 
on how this programme meets the policy specific criteria of paragraph 11 under Annex 2 
of the Agreement on Agriculture?  
 
Answer by Mexico  
 
In 2014, the Productive PROAGRO Programme replaced the Productive PROCAMPO Programme, 
but maintained practically the same characteristics, most notably the following:  
a. PROAGRO is a payment made on the basis of the land surface area registered by the 
beneficiary under the programme. The payments made per agricultural cycle in 2014 
were as follows:  G/AG/W/161  
 
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  Producer category  Payment by hectare  
(Mexican pes os) 
Producers with up to three hectares of land in rain -fed areas located in any of the 
405 municipalities covered by the national "Mexico without Hunger" programme  Mex$1,500.00  
Producers with up to three hectares of land in rain -fed areas located in the  rest of 
the country  Mex$1,300.00  
Producers with between three and five hectares of land in rain -fed areas or up to 
0.2 hectares of land in irrigated areas  Mex$1,300.00  
Producers with between five and 20 hectares of land in rain -fed areas or between 
0.2 and five hectares of land in irrigated areas  Mex$963.00  
All other producers with up to 80 hectares of land  Mex$963.00  
Source: 2014 Rules of Operation for SAGARPA programmes.  
 
In the 2016 Rules of Operation for SAGARPA programmes, the payments of Mex$1,50 0.00 and 
Mex$1,300.00 remained unchanged. Payments for all other producers were, however, reduced as 
follows: producers with between three and five hectares of rain -fed land or between 0.2 and 
five hectares of irrigated land = Mex$800.00; all other produce rs with up to 80 hectares = 
Mex$700.00.  
 
b. For each category of producer, the payment per hectare is FIXED AND UNRELATED 
TO: 
i. the product grown, provided that the crop is legal;  
ii. the yield per hectare;  
iii. the price level of the product grown, in either nationa l or international markets;  
iv. the inputs or combination thereof used in production;  
v. the prices of the inputs used to produce the crop.  
c. The main difference from PROCAMPO is that, under PROAGRO, the beneficiary is obliged 
to sow a legal crop on the land rec eiving support. For the purposes of verifying that the 
payment was actually used during the production process, the beneficiary must present 
fiscal proof of expenditure, thereby providing evidence of the purchase of an input, such 
as fertilizer or seeds, p hytosanitary control products, tools, equipment, or any other item 
that features on the list of 32 types of inputs provided in Annex B  to this document . 
Whoever fails to demonstrate the use to which the aid has been put, loses the right to 
receive it in th e future.  
The fact that PROAGRO support is based on land surface area rather than yield is clear from the 
following example:  
 
An average maize producer with 20 hectares of irrigated land in the State of Sinaloa, with a 
per hectare yield of ten tonnes, woul d receive Mex$14,000.00 (=Mex$700.00 * 20) as PROAGRO 
support and produce 200 tonnes of maize. An average maize producer with 20 hectares of 
irrigated land in the State of Chiapas, with an average per hectare yield of three tonnes, would 
also receive Mex$1 4,000.00 as PROAGRO support, but would only produce 60 tonnes of maize.  
 
This example shows that PROAGRO payments are NOT established on the basis of either the 
volume of production or the yield per hectare, which is why they are consistent with paragraph 
11(b) of Annex 2 of the Agreement on Agriculture.  
 
The measure is consistent with subparagraph (a) of the paragraph in question, as the right to 
receive PROAGRO support is determined on the basis of clearly defined criteria, i.e. the size of the 
surface ar ea registered in the list of beneficiaries and its corresponding categorical classification 
according to watering regime and geographical location in the country (in order to determine 
whether the land is located within any of the municipalities covered by  the national "Mexico 
without Hunger" programme). The programme also seeks to support the physical restructuring of 
a producer's operations, since the aid must be used to acquire the inputs listed in the Annex.  
 G/AG/W/161  
 
- 78 - 
 
  The measure is consistent with paragraph 11( c) and (e) of Annex 2, since, as mentioned before, 
the payment is fixed and does not relate to either the type of product being grown (as long as it is 
legal) or domestic and/or international prices.  
 
The measure is consistent with paragraph 11(d) as, for each particular investment, the support is 
provided on a one -off basis and the right to receive it in the future is not subject to it being used 
again for the same purposes.  
 
Lastly, subparagraph (f) is observed because the maximum amount of the aid (Mex$5 6,000.00 = 
Mex$700.00 * 80 hectares [maximum]), approximately US$2,800 per year, is so low that it is 
considered even lower than that necessary to compensate for the structural disadvantage of the 
beneficiary producers, many of whom receive support far bel ow the maximum amount, face 
production -related situations characterized by a lack of access to credit, and have obsolete 
production practices and insufficien t physical infrastructure, etc.  
 
2.4.4   Peru (G/AG/N/PER/16)  
AG-IMS ID 83099: Question by United States of  America - Transparency issues 
(including Table DS:2)  
The United States would like to thank Peru for its submission of this Table DS:2 
notification, which includes notification of several new or modified exempt measures, 
which were overdue.  The United Stat es looks forward to more regular submissions by 
Peru.  
 
Peru has notified the Payments for Competitiveness Progamme (AGROIDEAS) as 
meeting the criteria of Annex 2 paragraph 2.  Peru notifies that the programme "grants 
funding to support business management,  creation of producer associations and 
adoption of technology to sustainable businesses involving small and medium -sized 
agricultural, livestock or forest producers that form part of an organization, with a view 
to enhancing their competitiveness and stren gthening their market share," which, 
among other things, provides financing for technological improvement of production.  
 
a. Paragraph 2 of Annex 2 states that payments "shall not involve direct 
payments to producers or processors."  Please clarify how this me asure meets 
the criteria of paragraph 2.  
b. Please clarify what is meant by "technological improvement of production."  
Peru has notified the Special project for the Provinces of Datem del Marañon, Alto 
Amazonas, Loreto and Condorcanqui (PEDAMAALC) and noted t hat the program me 
includes activities for "development and implementation of public investment project 
with a view of ensuring the food security of less economically developed communities."  
 
c. Please clarify what is meant by "… with a view of ensuring the fo od security…"  
Answer by Peru  
a. The AGROIDEAS programme supports business management, the creation of producer 
associations and adoption of technology. It does not provide direct payments to 
producers or processors. Instead, it grants:  
 Support for the crea tion of producer associations: AGROIDEAS covers the expenses 
for legal or accounting advice, and the notary and registration fees required for the 
official establishment of the organization.  
 Support for management: AGROIDEAS covers the management fees for the 
organization for a maximum period of three years. It pays 70% of the total fees for 
the first year, 50% for the second year, and 30% for the third year.  G/AG/W/161  
 
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   Support for technology: The purchase of the goods and services required for the 
adoption of technol ogy. The percentage co ‑financed by AGROIDEAS varies between 
60% and 80%.  
b. The special project for the Provinces of Datem del Marañon, Alto Amazonas, Loreto and 
Condorcanqui (PEDAMAALC) aims to address the needs of the area, whose population 
lives in the  poorest quintiles of the country (over 80% of its inhabitants do not have 
access to basic services, there are no access routes by land, agricultural production 
consists of on -farm consumption and the incidence of tropical, zoonotic, infectious and 
contagi ous diseases is extremely high).  
2.4.5   United States of America (G/AG/N/USA/110)  
AG-IMS ID 83060: Question by Canada - Domestic food aid  
Title I – Dairy Product Donation Program, Sec.1431 of the U.S. Agricultural Act of 2014 
stipulates that one of its objectives  is to address low operating margins experienced by 
participating dairy operations while the programme trigger and termination thresholds 
involve factors such as dairy margin, as well as prices of cheddar cheese and non -fat dry 
milk.  
 
According to the Act , the Secretary makes purchases when the dairy margin is no more 
than $4.00 per hundredweight. Furthermore, the Secretary ceases purchasing activities 
when the domestic prices for cheddar cheese and non -fat dry milk become 5% above 
the world prices. Given this information, can the United States explain how the DPDP 
does not function to provide price support to dairy producers?  
 
Answer by United States of America  
 
The Dairy Product Donation Program makes purchases of dairy products through competitive bids 
at current market prices. Purchases are made in consultation with the Food and Nutrition Service 
to ensure that they meet the needs of low -income populations served by nutrition assistance 
programmes.  
AG-IMS ID 83086: Question by Japan - Domestic food aid  
In the DS:2 notification, the United States explains that Dairy Product Donation Program 
meets the criteria of Annex 2, paragraph 1 which requires "no trade -distorting effects or 
effects on production." Could the United States explain the concrete rational e for this?  
 
Answer by United States of America  
 
See reply above.  
AG-IMS ID 83061: Question by New Zealand - Domestic food aid  
New Zealand notes that in January 2017 the United States submitted its DS:1 and DS:2 
notifications for the marketing year 2014, t he year that the current Farm Bill was 
established. The notification is welcome but the United States continues to be behind in 
its WTO domestic support notifications. Given the significant size of the U.S. agriculture 
industry and its exports and governme nt support New Zealand urges the United States 
to bring its notifications up to date and seeks further information on the implementation 
of the US Farm Bill:  
 
a. how much has been spent to date on the Dairy Product Donation Program since 
the programme's peri od of application began?  
b. How many times has the Dairy Product Donation Program been triggered since 
the programme's period of application began in September 2014?  
Answer by United States of America  
 
In response to a and b: The United States has notified 2014 expenditures under these 
programmes as appropriate in its recent DS:1 notification for 2014. Further expenditures under G/AG/W/161  
 
- 80 - 
 
  these programmes will be reported in notifications for the years in which the expenditures are 
made.  
 
AG-IMS ID 83063: Question by New Zealand - Direct payments: payments for relief from 
natural disasters  
Please provide more detail about any claims made on the Non -insured Crop Disaster 
Assistance Program  (NAP) in each of the crop years 2015 and 2016.  
 
Answer by United States of Americ a 
 
The Foundation for Food and Agriculture Research was provided with a one -time transfer of 
U.S. government funds. Research funding decisions and disbursement of research funds are made 
by an independent Board of Directors. For more information, please se e: http://foundationfar.org/ . 
 
AG-IMS ID 83064: Question by Canada - Direct payments: payments under 
environmental programmes  
The U.S. DS:2 notification states that the National Organic Certification Cost -Share 
Program, classified under paragraph 12, Annex 2, is implemented through two 
programmes: the Agricultural Management Assistance (AMA) Organic Certification Cost 
Share Program and the National Organic Certification Cost Share Program (NOCCSP). 
Both programmes a ssist certified organic operations in defraying the costs associated 
with organic certification.  
The eligibility criteria in paragraph 12, Annex 2 states that eligibility for payments 
"…shall be determined as part of a clearly -defined government environme ntal or 
conservation programme…". Could the United States please elaborate as to how a 
production decision to grow organic crops is considered a meeting a "clearly -defined 
government environmental or conservation programme"?  
 
Answer by United States of Am erica 
 
USDA's National Organic Program regulatory definition of organic production specifies that 
practices be integrated to foster cycling of resources, promote ecological balance, and conserve 
biodiversity. USDA organic regulations provide specific produ ction practices required to meet 
certification standards. Producers receiving cost -share benefits under the NOCCSP are 
implementing production practices to meet these environmental and conservation standards.  
AG-IMS ID 83062: Question by New Zealand - Direct payments: payments under 
environmental programmes  
a. How much has been spent to date on the Agriculture Conservation Easements 
Program (ACEP) since program me sign-up began in May 2014?  
b. How much has been spent to date on the Regional Conservation 
Partnersh ip Program (RCPP) since program me sign-up began in May 2014.  
c. How much has been spent to date on the Environmental Quality Incentives 
Program (EQIP) since it incorporated the functions and funding of the repealed 
Wildlife Habitat Incentive Program (WHIP)?  
Answer by United States of America  
 
For all of the above questions: The United States has notified 2014 expenditures under these 
programmes as appropriate in its recent DS:1 notification for 2014. Further expenditures under 
these programmes will be report ed in notifications for the years in which the expenditures are 
made.  
 G/AG/W/161  
 
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  AG-IMS ID 83133: Question by New Zealand - Other  
Please provide more information about the nature of the agricultural research activities, 
if any, that have received funding from the Fo undation for Food and Agriculture 
Research programme.  
  
Answer by United States of America  
 
The United States has notified 2014 expenditures under these programmes as appropriate in its 
recent DS:1 notification for 2014. Further expenditures under these pr ogrammes for the 
years  2015 and 2016 will be reported in notifications for those years.  
 
2.5  EXPORT SUBSIDY COMMITMENTS (TABLES ES:1, ES:2 AND ES:3)  
2.5.1   Switzerland (G/AG/N/CHE/79)  
AG-IMS ID 83028: Question by European Union - Transparency issues  
a. Switzerland has i ncreased the amount of export subsidies granted to processed 
products by 36% in 2015 compared to 2014. How would Switzerland see the 
increase as complying with the Bali Ministerial Declaration on Export 
Competition according to which Members committed to e xercise utmost 
restraint with regard to any recourse to all forms of export subsidies and 
undertake to ensure to the maximum extent possible that the level of export 
subsidies will remain significantly below the Members' export subsidy 
commitments?  
b. Could S witzerland confirm that no export subsidies for cattle for breeding and 
horses were granted after 19 December 2015?  
Answer by Switzerland  
 
a. The Swiss Parliament increased the export subsidy budget for processed agricultural 
products for 2015. This decisi on was made in the context of the unexpected appreciation 
of the Swiss Franc and the corresponding impairment of competitiveness of Swiss 
exporters following the discontinuation of the minimum exchange rate of the Euro 
against the Swiss Franc by the Swiss National Bank in January 2015. The notified 
amount of export subsidies is substantially below the entitlements in the schedule of 
Switzerland -Liechtenstein.  
b. The implementation of the Nairobi Ministerial Decision on Export Competition requires an 
amendme nt of a cantonal piece of legislation. The cantonal government of Jura started 
right after the Nairobi decision with the necessary legal adjustments, but the budget 
outline for 2016 had already been fixed. Therefore export subsidies were provided for a 
few horses on a cantonal level by the canton of Jura only.  
AG-IMS ID 83029: Question by European Union - Incorporated products  
According to press reports, the new Swiss Chocolate Law voted by Parliament in 
December 2016 maintains the level of export subsidie s for chocolate producers using 
Swiss produced milk and cereals. Following the Nairobi Decision, cereals can no longer 
benefit from any export subsidies in the form of primary products. Also "eggs," "oils and 
fats" and "sugar" cannot benefit from any expor t subsidies in the form of primary 
products. However the content of these primary products affects the amount of export 
subsidies granted to processed products, according to the export subsidy notification.  
 
How would Switzerland see this as complying wit h Article 11 of the Agreement on 
Agriculture which states that the per -unit subsidy paid on an incorporated agricultural 
primary product shall not exceed the per -unit export subsidy that would be payable on 
exports of the primary product as such?  
 
Answer b y Switzerland  
 G/AG/W/161  
 
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  In December 2016, the Swiss Parliament set the budget for 2017 at 94.6 million Swiss Francs for 
export refunds under the Federal Law of 13 December 1974 on the importation and the 
exportation of processed agricultural products (the so -called  "Chocolate law ") for certain processed 
agricultural products. This is the same amount as was allocated for the year 2016. Apart from this 
yearly budget decision, no revision of the "Chocolate Law " was undertaken in December 2016.  
 
The Swiss Schedule of Co ncessions contains a list of certain basic agricultural products eligible for 
export refunds when exported incorporated in processed agricultural products. In conformity with 
Para. 6 Footnote 4 of the Nairobi Ministerial Decision on export competition, whi ch establishes an 
exception to the general and immediate prohibition of export subsidies, Switzerland continues to 
grant export refunds for certain processed agricultural products. Switzerland applies a price 
compensation scheme to compensate for the diffe rence of raw material prices between the 
domestic and foreign markets faced by the domestic food industry as a result of the use of locally 
produced agricultural raw materials. According to the current Swiss legislation, only certain 
processed agricultural  products containing selected basic dairy products and selected certain cereal 
products are eligible for price compensation.  
 
According to Article 11 of the WTO Agreement on Agriculture, WTO Members are not prohibited 
from granting subsidies, in accordance  with Part IV of Section II of their Schedules of Concessions, 
on processed products in the event that the primary products contained in such processed 
products are not subsidized in the same manner.  
 
Switzerland can confirm that applied per -unit subsidy rates granted for basic agricultural products 
incorporated in processed products do not exceed the price differences between domestic and 
foreign markets. Therefore, these applied per -unit subsidy rates do not exceed the per - unit export 
subsidy that would  be payable on exports of the primary product as such. Economically the Swiss 
export refunds do not have the effect of a subsidy to the processing industry but only compensate 
the market price differences of certain raw materials.  
 
AG-IMS ID 83030: Questio n by European Union - International food aid  
In the ES:3 notification, Switzerland notifies that 3,149.86 tonnes of milk powder has 
been granted as food aid. Could Switzerland specify if these in -kind amounts have been 
provided under emergency or non -emerg ency programmes?  
 
Answer by Switzerland  
 
The total amount of the milk powder has been provided under non -emergency programmes. It has 
been used either by WFP in country respective Protracted Relief and Recovery Operations or 
Development Operations or by Sw iss NGOs in on -going support programmes in the field but not in 
emergency operations.  
 
Follow -up: New Zealand and the United States  noted interest in question  AG-IMS 83028 and 
indicated that they might  pose follow -up questions to Switzerland. Ukraine appre ciated 
Switzerland's commitment to abide by the Nairobi Ministerial Decision. It looked forward to 
Members' updates on their export competition polices at the Annual Examination  to be held in 
June.    
 
3  OVERDUE NOTIFICATION S 
3.1  Egypt  
AG-IMS ID 83031: Question b y European Union  
Could Egypt update Members on the progress made since the June 2015 Committee 
meeting on its outstanding notifications on Domestic Support?  
 
Answer by Egypt  
 
In the last committee meeting in November 2016, Egypt briefed the Committee on i ts recent 
efforts taken within the nation -wide plan to restructure the agriculture sector on several G/AG/W/161  
 
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  dimensions including harmonizing and unifying agencies involved in dealing with domestic support, 
with a view to facilitate data availability and collectio n. 
 
In order not to be repetitive in presenting the challenges Egypt is facing in implementing this 
restructure plan and taking recent measures, Egypt would like to refer to its statement in 
November Committee meeting and the full response is available und er AG -IMS ID 82046.  
 
In the same vein, Egypt seizes this opportunity to assure that Egypt has taken a good note of the 
EU concern, and to confirm that Egyptian government is sparing no effort to overcome all 
obstacles hindering submitting Domestic Support  notifications. Egypt would like to assure Members 
that any further updates received on this matter will be communicated to the Committee in due 
course.  
 
Finally, Egypt would like to reiterate its full support and commitment to the objective of 
transparenc y under the Agreement on Agriculture. Egypt is aware of its obligations in the 
framework of the Agreement; and acknowledges the importance of Domestic Support notifications 
in terms of providing transparency and the general implementation of the Agreement.   
 
Follow -up: Australia, the European Union and the United States flagged interest in all Members’ 
overdue notifications. Australia and New Zealand noted concern regarding the large amount of 
overdue notifications in a year of a Ministerial conference, par ticularly in domestic s upport  where 
almost half of the notifications were outstanding.  
 
3.2  India  
AG-IMS ID 83100: Question by United States of America  
The United States notes that India has not notified domestic support in Table DS:1 
notifications for any y ear since 2010 and has never notified any Table DS:2 notification 
since joining the WTO. Please provide an update on when Members can expect to see up 
to date notifications for review by this Committee.  
 
Answer by India  
 
India's notifications post 2010 are  under preparation and will be notified in due course.  
 
Follow -up: Australia, the European Union and the United States flagged interest in all Members’ 
overdue notifications.  
 
3.3  Indonesia  
AG-IMS ID 83032: Question by European Union  
The latest notification from Indonesia dates back to 2013 and covers 2009 to 2011. 
Could Indonesia inform members on when notifications for more recent years will 
become available?  
 
Answer by Indonesia  
 
Indonesia confirms that its latest notification on Domestic Support and Marke t Access was in the 
year of 2013 which covers data from 2009 until 2011.  
For Domestic Support notification, the preparation is still underway. The Domestic Support 
notification consists of various support measures, which in Indonesia's case involves sever al 
ministries/agencies. The notification will be submitted to this Committee once Indonesia's domestic 
process is completed.  
While for Market Access pillar, Indonesia is aware that its latest notification are contained in the 
document G/AG/N/IDN/32 (MA:2 - TRQ) and G/AG/N/IDN/33 (MA:5 -SSG), which covers the period 
of 2009 to 2011. Indonesia will update its notification related to Market Access pillar at the earlest 
appropriate stage.  G/AG/W/161  
 
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  Regarding export subsidy pillar, Indonesia has notified its commitments f or the calendar years 
2012-2015 in document G/AG/N/IDN/35 dated 1  September 2016.  
Follow -up: Australia, the European Union and the United States flagged interest in all Members’ 
overdue notifications.  
 
3.4  Thailand  
AG-IMS ID 83033: Question by European Union  
The latest notification from Thailand dates back to 2014 and covers 2008. Could 
Thailand inform Members as to when notifications for more recent years will become 
available?  
 
Answer by Thailand  
 
The capital is still gathering the information required for the notification on domestic support, and 
will notify the CoA in due course.  
AG-IMS ID 83101: Question by United States of America  
As the world's historically largest rice trader, transparency with regards to current and 
past agricultural policies is vital . In June 2016, Thailand stated it was consulting its 
domestic agencies regarding prior notifications (AG -IMS ID 80082).  
 
a. As previously noted, Thailand's last domestic support notification was in 2008. 
When can an update be expected?  
b. If a time frame still cannot be set, greater clarity regarding the impediments 
would be helpful. Also, an interim partial notification should be considered, as 
other Members have provided that in the past.  
Answer by Thailand  
 
See reply above.  
 
Follow -up: Australia, the European  Union and the United States flagged interest in all Members’ 
overdue notifications.  
 
3.5  Turkey  
AG-IMS ID 83034: Question by European Union  
At the 82nd meeting of the Committee on Agriculture (AG -IMS ID 82019), Turkey 
indicated that it had created a WTO Comm ittee within the Ministry of Food, Agriculture 
and Livestock and was hoping to make their decision about updating notifications.  
 
Can Turkey please inform Members as to what progress the Committee has made? 
Further, when does Turkey expect to complete the  overdue export subsidy and domestic 
support notifications?  
 
Answer by Turkey  
 
Turkey is well aware of the notification obligations with regard to the Agreement on Agriculture. 
Last year in 2016 several committees were formed within the Ministry of Food, A griculture, and 
Livestock to analyze, organize and finalize notifications such as SPS and other WTO -related 
WTO subjects. In addition to the WTO committee within the Ministry, an SPS committee and a 
Domestic Support committee have been formed to raise awar eness and organize the issues within 
a formal framework under the Ministry. So far, the Domestic Support committee has started to 
coordinate various branches of the Ministry to gather data, experts and other related information 
regarding the overdue notifi cations. Each product has been started to be analyzed in line with the 
WTO Agreement on Agriculture. The process is still ongoing but so far, the awareness to WTO 
matters within the Ministry is rising, which Members can witness through SPS notifications fr om G/AG/W/161  
 
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  Turkey. In this respect, Turkey will share the information and analysis gathered through those 
committees with Members in due course. Turkey strongly believes in the WTO and is committed to 
its WTO commitments as well as to its transparency obligations in that regard. Therefore, Turkey's 
related bodies are working to comply with those obligations and Turkey appreciates Member's 
patience and support in this process.   
 
AG-IMS ID 83102: Questio n by United States of America  
A number of Members have repeatedl y requested clarification as to why Turkey has not 
notified its domestic support for more than a decade.  In November 2016, Turkey noted 
that it had established a committee in the Turkish Ministry of Food, Agriculture, and 
Livestock to address this issue (A G-IMS ID 82019, AG -IMS ID 82043, and 
AG-IMS ID 82044).  
 
a. Please provide an update to the work that has been done by this committee to 
address this serious issue.  
b. Is Turkey considering providing partial notifications to provide information as it 
is made avai lable?  
c. What, if any, limitations has this committee found in terms of the factors that 
limit Turkey's ability to make a notification?  
d. Please indicate what the next steps of this committee are to address this issue.  
Answer by Turkey  
 
See reply above.  
 
Follow-up: Australia, the European Union and the United States flagged interest in all Members’ 
overdue notifications. New Zealand welcomed Turkey’s efforts on improving its transparency 
record within the WTO, including its recent presentation on its agricultu ral policies, the bilateral 
exchange s with various M embers  and its commitment to bring its notifications up to date.  
New Zealand urged all Members with overdue notifications to submit them as soon as possible, 
particularly in a year of a Ministerial Confer ence. Canada and the European Union echoed New 
Zealand’s call. The Russian Federation express ed interest  in receiving Turkey's Domestic Support  
notification as soon as possible.  
 
 
4  OTHER  
4.1  New Zealand AG -IMS ID 83037: Question by Chile  
New Zealand clarified i n its replies to Chile's questions (AG -IMS ID 82065, document 
G/AG/W/159) in the CoA Meeting in November 2016 that the amendments to the 
Regulations are expected to take place before the start of the 2017 kiwifruit export 
season. Chile kindly asks New Zeal and to update on whether the changes to the 
Kiwifruit Export Regulations 1999 have taken place, and to provide the new legislation, 
if any.  
  
Specifically, concerning the KNZ's Board composition and based on the answer provided 
by New  Zealand, Chile under stands that there are five board members plus the KNZ 
Chair, with three board members elected by the kiwifruit growers. Could New Zealand 
clarify further on whether Chile's understanding is correct? If so, how can the New 
Zealand government guarantee the i mpartiality of the new KNZ Board?  
 
Answer by New Zealand  
 
The proposed amendments to the Kiwifruit Export Regulations 1999 have not yet taken place. The 
amendments continue to progress through the New Zealand legislative system, and the 
expectation now is that the amendments will be finalised and promulgated in April -May 2017 and G/AG/W/161  
 
- 86 - 
 
  implemented by 1 July 2017. The proposed amendments to the Regulations will enhance Kiwifruit 
New Zealand's (KNZ) status as an independent regulator. This is ensured through 
KNZ's  composition, governance and regulatory obligations. Under the proposed amendments to 
the Regulations the KNZ Board will be comprised of three grower -elected directors, two 
independent directors appointed by the Minister for Primary Industries, and an indep endent chair 
appointed by the Minister for Primary Industries. The independent chair will, in the case of a tied 
vote, have the casting vote. As an independent regulator, KNZ will continue to monitor and 
enforce the non -discrimination rule, the non -diversi fication rule, information disclosure 
requirements, and collaborative marketing requirements, as set out under the Kiwifruit Export 
Regulations 1999. As the independent regulator KNZ will be required to prepare three -yearly 
Statements of Intent that will b e approved by the Minister for Primary Industries. The Ministry for 
Primary Industries will engage annually with KNZ to discuss performance against its Statement of 
Intent. Moreover, there will be independent reviews of KNZ's performance at six yearly inte rvals. 
More information about the proposed amendments are available on the Ministry for Primary 
Industries website http://www.mpi.g ovt.nz/news -and-resources/consultations/proposed -
amendments -to-kiwifruit -export -regulations/ . New Zealand's Kiwifruit Export Regulations 1999 are 
publically available at http://www.legislation.govt.nz . New Z ealand will ensure that the regulatory 
structure remains consistent with all WTO obligations.  
 
Follow -up: The European Union indicated interest in the question.  
 
 G/AG/W/161  
 
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  ANNEX A  
Table A: Import volume by TRQ product areas and country, in kilograms  
Reporting 
period:  1 July 2014 to 30 June 2015  1 July 2015 to 30 June 
2016  
1.7.2014 to 31.12.14 
(6m)  1.1.15 to 30.6.15 
(6m)  1.7.15 to 30.6.15 (12m)  
1 2 3 4 
Meat and edible offal of bovine animals (0201, 0202, 0206, 0210)   
Australia  NA 0 39 
Belgium  NA 2.737  0 
Denmark NA 79.921  94.455  
Finland  NA 0 207 
Germany  NA 243.084  394.777  
Ireland  NA 0 8.300  
Italy NA 4.247  3.959  
Lithuania  NA 15.064  0 
Netherlands  NA 19.757  55.468  
New Zealand  NA 40.455  85.391  
Poland  NA 42.029  49.019  
Russian Federation  NA 0 891 
Spain  NA 18.937  52.186  
UK NA 22.680  60.613  
USA NA 292 1.564  
Total  501.751  489.203  806.869  
Meat and edible offal of swine (0203, 0206, 0209, 0210)   
Denmark  NA 50.616  362.461  
Germany  NA 67.284  126.477  
Hungary  NA 0 1.000  
Italy NA 8.434  23.874  
Lithuania  NA 3.114 63 
Netherlands  NA 27.126  52.014  
Poland  NA 2.131  20 
Spain  NA 101.807  112.128  
Sweden  NA 0 59 
Thailand  NA 0 0 
UK NA 34 0 
Total  312.759  260.546  678.096  
Meat and edible offal of poultry (0207, 0210)    
Denmark  NA 65.963  432.797  
Faroe Islands  NA 0 0 
France  NA 14.202  60.476  
Germany  NA 245.572  676.288  
Hungary  NA 0 640 
Ireland  NA 0 252 
Latvia  NA 0 22 
Lithuania  NA 44.320  95.120  
Netherlands  NA 23.174  84 
Poland  NA 0 7.624  
UK NA 0 0 
Total  552.656  393.231  1.273.303  
Eggs (0407, 0408)    
Australia  NA 0 0 
China  NA 0 48 
Denmark  NA 39.760  102.484  
France  NA 0 0 
Germany  NA 2.000  39.318  
Netherlands  NA 50 1.901  
Norway  NA 1.094  635 
Sweden  NA 9.848  13.610  
Chinese Taipei  NA 9 0 
Thailand  NA 0 17 
UK NA 516 726 
Total  70.909  53.277  158.739  G/AG/W/161  
 
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  Table B: Im port volume (annual) by TRQ product areas and country, in kilograms  
YEAR:  2014  2015  
 1.1.2014 to 31.12.14  1.1.15 to 31.12.15  
1 2 3 
Meat and edible offal of bovine animals (0201, 0202, 0206, 0210)  
Australia  445 0 
Belgium  0 2.737  
Denmark  113.526  139.9 41 
Finland  0 207 
Germany  671.899  510.890  
Ireland  1.152  6.670  
Italy 9.304  7.610  
Lithuania  15.409  15.064  
Netherlands  36.764  52.567  
New Zealand  22.557  75.715  
Poland  30.319  91.048  
Russian Federation  0 891 
Spain  112.331  70.573  
UK 22.767  73.305  
USA 751 1.603  
Total  1.037.224  1.048.821  
Meat and edible offal of swine (0203, 0206, 0209, 0210)  
Denmark  181.203  241.392  
Germany  205.872  114.153  
Hungary  0 0 
Italy 25.666  20.632  
Lithuania  0 3.177  
Netherlands  23.439  48.951  
Poland  6 2.151  
Spain  119.161  167.274  
Sweden  90 20 
Thailand  81 0 
UK 0 34 
Total  555.518  597.784  
Meat and edible offal of poultry (0207, 0210)   
Denmark  287.808  259.605  
Faroe Islands  5 0 
France  64.379  53.481  
Germany  595.739  543.416  
Hungary  1.280  640 
Ireland  384 252 
Latvia  0 22 
Lithuania  63.720  85.440  
Netherlands  0 23.258  
Poland  101 7.624  
UK 6.021  0 
Total  1.019.437  973.738  
Eggs (0407, 0408)    
Australia  1 0 
China  0 48 
Denmark  97.181  87.052  
France  7 0 
Germany  53.914  4.001  
Netherlands  111 540 
Norway  1.040  1.729  
Sweden  11.480  16.504  
Chinese Taipei  0 9 
Thailand  0 0 
UK 390 736 
Total  164.124  110.619  
 G/AG/W/161  
 
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  ANNEX B  
MEXICO'S LIST OF ITEMS FOR VERIFYING THE USE OF   
SUPPORT GRANTED UNDER PROAGRO:  
No. Category  Code  Item  
1 Fertilizers  1 Chemical fertilizer  
2 Bio-fertilizers  
3 Organic fertilizers (compost, vermicompost, etc.)  
4 Substrates  
5 Growth regulators (auxins, gibberellins, etc.)  
6 Other items (fertilizers, manure, correctors and substrates)  
2 Improved seed  7 Improved seed  
8 Hybrid seed  
9 Indigenous or selected seed  
10 Seedlings  
11 Propagation material  
12 Nursery production units  
13 Seedbeds  
14 Other items (seed and plant material)  
3 Phytosanitary 
control products  15 Chemical products (insecticides, fungicides, bactericides, acaricides, 
pheromones, etc.)  
16 Biological products (bio -insecticides, bio -fungicides, bio -bactericides, 
bio-acaricides, pheromones, etc.)  
17 Other items (phytosanitary control inputs)  
4 Labour  18 Wages  
19 Labour  
5 Yoke animals 
and agricultural 
machinery, 
equipment and 
tools  20 Leasing of yoke animals  
21 Leasing of agricultural machinery  
22 Leasing of equipment for agricultural work  
23 Leasing of agricultural tools  
24 Purchasing of yoke animals  
25 Purchasing of agricultural machinery  
26 Purchasing of equipment for agricultural work  
27 Purchasing of agricultural tools  
28 Other, with a view to the use of machinery and equipment  
6 Security for 
access to credit  29 Liquid security for access to financing with the Development Bank or 
Nation al Agricultural, Rural, Forestry and Fisheries Development Bank  
30 Capitalization of financial intermediaries constituted by the producers 
themselves with the Development Bank or National Agricultural, Rural, 
Forestry and Fisheries Development Bank  
31 Savings for obtaining financing with the Development Bank or National 
Agricultural, Rural, Forestry and Fisheries Development Bank  
32 Other items  
Source:  2016 Rules of Operation for SAGARPA programmes.  
 
 
__________