WT/DS511/R  
 
28 February 2019  
(19-1108) Page: 1/115 
  Original: English  
 
  
CHINA – DOMESTIC SUP PORT FOR AGRICULTURA L PRODUCERS  
REPORT OF THE PANEL  
 
 
 
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  TABLE OF CONTENTS  
 
1   INTRODUCTION  ................................ ................................ ................................ ....... 13 
1.1   Complaint by the United States  ................................ ................................ ..................  13 
1.2   Panel establishment and composition  ................................ ................................ ..........  13 
1.3   Panel proceedings  ................................ ................................ ................................ ..... 13 
1.3.1   General  ................................ ................................ ................................ ................  13 
1.3.2    United States' request for partially open meetings  ................................ .....................  13 
1.3.3    Terms of reference  ................................ ................................ ................................ . 14 
2   FACTUAL ASPECTS ................................ ................................ ................................ .... 14 
2.1   Measures at issue  ................................ ................................ ................................ ..... 14 
3   PARTIES' REQUESTS FO R FINDINGS AND RECOM MENDATIONS  ...............................  14 
4   ARGUMENTS OF THE  PARTIES  ................................ ................................ ..................  15 
5   ARGUMENTS OF THE  THIRD PARTIES  ................................ ................................ ....... 15 
6   INTERIM REVIEW  ................................ ................................ ................................ ..... 15 
7   FINDINGS  ................................ ................................ ................................ ................  18 
7.1   United States' request for partially open Panel meetings with the parties  .........................  18 
7.1.1    Procedural background  ................................ ................................ ...........................  18 
7.1.2    Introduction  ................................ ................................ ................................ ..........  19 
7.1.3    Panel's analysis  ................................ ................................ ................................ ..... 20 
7.1.3.1    Introduction  ................................ ................................ ................................ ....... 20 
7.1.3.2    Article 18.2 of the DSU  ................................ ................................ ........................  20 
7.1.3.3    Prior disputes addressing open or partially open hearings  ................................ ........  22 
7.1.3.4    Concluding considerations  ................................ ................................ ....................  25 
7.2   The measures  challenged in this dispute and China's claim relating to the expiry of  
one of the measures  ................................ ................................ ................................ .........  27 
7.2.1    The measures challenged by  the United States  ................................ ..........................  27 
7.2.2    China's terms of reference claim raised with regard to the corn measure  ......................  31 
7.2.2.1    Whether the corn measure has expired  ................................ ................................ .. 34 
7.2.2.2    Whether the Panel should make findings on the otherwise expired corn measure  ........  39 
7.2.3    Main characteristics of the wheat and rice measures  ................................ ..................  43 
7.2.3.1    General framework  ................................ ................................ .............................  43 
7.2.3.2    Market price support programmes for wheat and rice  ................................ ..............  43 
7.2.3.3    Entities involved  ................................ ................................ ................................ . 45 
7.2.3.4    Geographical scope  ................................ ................................ .............................  46 
7.2.3.5    Temporal scope  ................................ ................................ ................................ .. 46 
7.2.3.6   Quality requirements  ................................ ................................ ...........................  47 
7.3   Claims brought by the United States and Panel's order of analysis  ................................ .. 47 
7.4   Claims under Articles 6.3 and 3.2 of the Agreement on Agriculture  ................................ . 48 
7.4.1    Introduction  ................................ ................................ ................................ ..........  48 WT/DS511/ R 
 
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  7.4.2    Domestic support obligations as set out in Articles 3.2 and 6.3 of the Agreement on 
Agriculture  ................................ ................................ ................................ ......................  49 
7.4.3    Calculation of AMS and Current Total AMS under the Agreement on Agriculture  .............  52 
7.4.4    Preliminary considerations in relation to China's domestic support commitments  ...........  59 
7.4.4.1    Tables of supporting material and Member -specific domestic support -related 
commitments  ................................ ................................ ................................ ..................  59 
7.4.5    Issues relating to the  definition and calculation of the variables of the MPS formula  ....... 61 
7.4.5.1    Applied Administered Price  ................................ ................................ ...................  61 
7.4.5.2    Fixed external reference price  ................................ ................................ ...............  62 
7.4.5.2.1    FERP contained in China's tables of supporting material  ................................ ........  64 
7.4.5.2.2    Other Members' tables of supporting material  ................................ ......................  67 
7.4.5.2.3    Consistency in the calculations of Base Total AMS and Current Total AMS  ................  71 
7.4.5.2.4    The FERP that should be used in the present dispute  ................................ ............  77 
7.4.5.3    Quantity of production eligible to receive the AAP  ................................ ...................  82 
7.4.5.3.1    Geographical scope of the programme  ................................ ................................  88 
7.4.5.3.2    Temporal scope of the programme  ................................ ................................ ..... 88 
7.4.5.3.3    Activation and de -activation of the programme  ................................ ....................  89 
7.4.5.3.4    Minimum grain quality requirements  ................................ ................................ ... 89 
7.4.5.3.5    Consumption of grain on small -scale farms ................................ ..........................  91 
7.4.5.3.6    Conclusion  ................................ ................................ ................................ ...... 91 
7.4.5.4    Processing -level adjustment  ................................ ................................ .................  91 
7.4.5.4.1    Which variable should be adjusted  ................................ ................................ ..... 93 
7.4.5.4.1.1    Basic agricultural product  ................................ ................................ ...............  93 
7.4.5.4.1.2    Point of first sale  ................................ ................................ ...........................  95 
7.4.5.4.2    Adjustment rate to be used in this case  ................................ ..............................  97 
7.4.5.4.3    Conclusion on the processing -level adjustment  ................................ ....................  99 
7.4.6    Calculation of China's Current Total  AMS ................................ ................................ .. 99 
7.4.7    MPS Calculations  ................................ ................................ ................................ . 100 
7.4.7.1    Wheat  ................................ ................................ ................................ .............  100 
7.4.7.2    Rice ................................ ................................ ................................ ................  102 
7.4.7.2.1    Total value of production of rice  ................................ ................................ ....... 102 
7.4.7.2.2    Volume of production of rice per province ................................ ..........................  103 
7.4.7.2.3    Weighted average AAP  ................................ ................................ ....................  104 
7.4.7.2.4    Conclusion on these issues  ................................ ................................ ..............  105 
7.4.7.2.5    Japonica rice  ................................ ................................ ................................ . 105 
7.4.7.2.5.1    Japonica rice (United States' approach)  ................................ ..........................  105 
7.4.7.2.5.2    Japonica rice (China's approach)  ................................ ................................ ... 107 
7.4.7.2.6    Indica rice (United States' approach)  ................................ ................................  109 
7.4.7.2.6.1    Early-season Indica rice  ................................ ................................ ...............  109 
7.4.7.2.6.2    Mid-Late-Season Indica rice  ................................ ................................ ..........  111 
7.4.7.2.6.3    Total Indica rice MPS calculation  ................................ ................................ .... 112 WT/DS511/ R 
 
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  7.4.7.2.7    Indica rice (China's approach)  ................................ ................................ .........  113 
7.4.8    Conclusion on the calculation of China's Current Total  AMS ................................ ....... 114 
7.5   Claim under Article 7.2(b) of the Agreement on Agriculture  ................................ .........  115 
8   CONCLUSIONS AND RECOMMENDATIONS  ................................ ..............................  115  
 
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LIST OF ANNEXES  
 
ANNEX A  
WORKING PROCEDURES O F THE PANEL  
Contents  Page  
Annex  A Working Procedures of the Panel  4 
ANNEX B  
ARGUMENTS OF THE PAR TIES 
Contents  Page  
Annex  B-1 Integrated executive summary of the arguments of the United States  10 
Annex  B-2 Integrated executive summary of the arguments of China  35 
ANNEX C  
ARGUMENTS OF THE THI RD PARTIES  
Contents  Page  
Annex  C-1 Integrated executive summary of the arguments of Australia  62 
Annex  C-2 Integrated executive summary of the arguments of Brazil  65 
Annex  C-3 Integrated executive summary of the arguments of Canada  67 
Annex  C-4 Integrated executive summary of the arguments of Colombia  71 
Annex  C-5 Integrated executive summary of the arguments of Ecuador  72 
Annex  C-6 Integrated executive summary of the arguments of the European Union  74 
Annex  C-7 Integrated executive summary of the arguments of India  76 
Annex  C-8 Integrated executive summary of the arguments of Indonesia  78 
Annex  C-9 Integrated executive summary of the arguments of Japan  80 
Annex  C-10 Integrated executive summary of the arguments of Kazakhstan  83 
Annex  C-11 Integrated executive summary of the arguments of the Russian Federation  86 
 
ANNEX D  
RAW DATA  
Contents  Page  
Annex  D Raw data as presented by the parties  90 
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  ABBREVIATIONS USED I N THIS REPORT  
Abbreviation  Description  
AAP Applied Administered Price  
ADBC  Agricultural Development Bank of China  
AMS Aggregate Measurement(s) of Support  
CDM Constituent Data and Methodology  
DSB Dispute Settlement Body  
DSU Understanding on Rules and Procedures Governing the Settlement of Disputes  
FERP Fixed External Reference Price  
GATT 1994  General Agreement on Tariffs and Trade 1994  
MPS Market Price Support  
QEP Quantity of Eligible Production  
Sinograin  China Grain Reserve Corporation  
TPRP Temporary Purchase and Reserve Policy for corn  
USDA  United States Department of Agriculture  
Vienna Convention (VCLT)  Vienna Convention on the Law of Treaties, Done at Vienna, 23 May 1969, 1155 
UNTS 331; 8 International Legal Materials 679  
WTO World Trade Organization  
WTO Agreement  Marrakesh Agreement Establishing the World Trade Organization  
 
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CASES CITED IN THIS REPORT  
Short title  Full case title and citation  
Argentina – Textiles and 
Apparel  Panel Report, Argentina – Measures Affecting Imports of Footwear, Textiles, 
Apparel and Other Items , WT/DS56/R , adopted 22 April 1998, as modified by 
Appellate Body Report WT/DS56/ AB/R, DSR 1998:III, p. 1033  
Canada – Continued 
Suspension  Appellate Body Report, Canada – Continued Suspension of Obligations in the EC 
– Hormones Dispute , WT/DS321/AB/R , adopted 14 November 2008, DSR 
2008:XIV, p. 5373  
Canada – Continued 
Suspension  Panel Report, Canada – Continued Suspension of Obligations in the EC – 
Hormone s Dispute , WT/DS321/R  and Add.1 to Add.7, adopted 14 November 
2008, as modi fied by Appellate Body Report WT/DS321/AB/R, DSR 2008:XV, p. 
5757 
Canada – Wheat Exports 
and Grain Imports  Panel Report, Canada – Measures Relating to Exports of Wheat and Treatment of 
Imported Grain , WT/DS276/R , adopted 27 September 2004, upheld by Appellate 
Body Report WT/DS276/AB/R, DSR 2004:VI, p. 2817  
Chile – Price Band System  Panel Report, Chile – Price Band System and Safeguard Measures Relating to 
Certain Agricultural Products , WT/DS207/R , adopted 23 October 2002, as 
modified by Appellate Body Report WT/DS207AB/R, DSR 2002:VIII, p. 3127  
China – Electronic Payment 
Services  Panel Report, China – Certain Measures Affecting Electronic Payment Ser vices, 
WT/DS413/R  and Add.1, adopted 31 August 2012, DSR 2012:X, p. 5305  
China – HP-SSST (Japan) / 
China – HP-SSST (EU)  Appellate Body Reports, China – Measures Imposing Anti -Dumping Duties on 
High-Performance Stainless Steel Seamless Tubes ("HP -SSST") from Japan / 
China – Measures Imposing Anti -Dumping Duties on High -Performanc e Stainless 
Steel Seamless Tubes ("HP -SSST") from the European Union , WT/DS454/AB/R  
and Add.1 / WT/DS460/AB/R  and Add.1, adopted 28 October 2015 , DSR 2015:IX, 
p. 4573  
China – Raw Materials  Appellate Body Reports, China – Measures Related to the Exportation of Various 
Raw Materials , WT/DS394/AB/R  / WT/DS395/AB/R  / WT/DS398/AB/R , adopted 
22 February 2012, DSR 2012:VII, p. 3295  
Dominican Republic – 
Import and Sale of 
Cigarettes  Appellate Body Report, Dominican Republic – Measures Affecting the I mportation 
and Internal Sale of Cigarettes , WT/DS302/AB/R , adopted 19 May  2005, DSR 
2005:XV, p. 7367  
EC – Bananas III  
(Article  21.5 – Ecuador II) /  
EC – Bananas III  
(Article  21.5 – US) Appellate Body Reports, European Communities – Regime for the Importation, 
Sale and Distribution of Bananas – Second Recourse to Article  21.5 of the DSU 
by Ecuador , WT/DS27/AB/RW2/ECU , adopted 11 December  2008, and Corr.1 / 
European Communities – Regime for the Importation, Sale and Distribution of 
Bananas – Recourse to Article  21.5 of the DSU by the United States , 
WT/DS27/AB/RW/USA  and Corr.1, adopted 22 December 2008, DSR 2008:XVIII, 
p. 7165 
EC – Bananas III  
(Article  21.5 – US) Panel Report, European Communities – Regime for the Importation, Sale and 
Distribution of Bananas – Recourse to Article  21.5 of the DSU by the United 
States , WT/DS27/RW/USA  and Corr.1, adopted 22 December 2008, upheld by 
Appellate Body Report WT/DS27/AB/RW/USA, DSR 2008:XIX, p.  7761 
EC – Approval and 
Marketing of Biotech 
Products  Panel Reports, European Communities – Measures Affecting the Approval and 
Marketing of Biotech Products , WT/DS291/R , Add.1 to Add.9 and Corr.1 / 
WT/DS292/R , Add.1 to Add.9 an d Corr.1 / WT/DS293/R , Add.1 to Add.9 and 
Corr.1, adopted 21 November 2006,  DSR 2006:III, p. 847  
EC – Chicken Cuts  Appellate Body Report, European  Communities – Customs Classification of Frozen 
Boneless Chicken Cuts , WT/DS269/AB/R , WT/DS286/AB/R , adopted 27 
September 2005, and Corr.1, DSR 2005:XIX, p. 9157 
EC – Chicken Cuts  Panel Reports, European Communities – Customs Classification of Frozen 
Boneless Chicken Cuts , WT/DS269/R (Brazil)  / WT/DS286/R (Thailand) , adopted 
27 September 2005, as modified by Appellate Body Report WT/DS269/AB/R, 
WT/DS286/AB/R, DSR 2005:XIX, p. 9295 / DSR 2005:XX, p. 9721 
EC – Hormones  Appellate Body Report, EC Measures Concerning Meat and Meat Products 
(Hormones) , WT/DS26/AB/R , WT/DS48/AB/R , adopted 13 February 1998, DSR 
1998:I, p. 135  
EC – IT Products  Panel Reports, European Communities and its member States – Tariff Treatment 
of Certain Information Technology Products , WT/DS375/R  / WT/DS376/R  / 
WT/DS377/R , adopted 21 September 2010, DSR 2010:II I, p. 933  
EC – Selected Customs 
Matters  Appellate Body Report, European Communities – Selected Customs Matters , 
WT/DS315/AB/R , adopted 11 December 2006, DSR 2006:IX, p. 3791  WT/DS511/ R 
 
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  Short title  Full case title and citation  
EC and certain member 
States – Large Civil Aircraft  Appellate Body Report, European Communities and Certain Member States – 
Measures Affecting Trade in Large Civil Aircraft , WT/DS316/AB/R , adopted 1 June 
2011, DSR 2011:I, p. 7  
EU – Biodiesel (Argentina)  Appellate Body Report, European Union – Anti-Dumping Measures on Biodiesel 
from A rgentina , WT/DS473/AB/R  and Add.1, adopted 26 October 2016, DSR 
2016:VI,  p. 2871  
EU – Fatty Alcohols 
(Indonesia)  Appellate Body Report, European Union – Anti-Dumping Measures on Imports of 
Certain Fatty Alcohols from Indonesia , WT/DS442/AB/R  and Add.1, adopted 29 
September 2017  
EU – PET (Pakistan)  Appellate Body Report, European Union – Countervailing Measures on Certain 
Polyethylene Terephthalate  from Pakistan , WT/DS486/AB/R  and Add.1, adopted 
28 May 2018 
EU – PET (Pakistan)  Panel Report, European Union – Countervailing Measures on Certain Polyethylene 
Terephthalate  from Pakistan , WT/DS486/R , Add.1 and Corr.1, adopted 28 May 
2018, as modified by Appellate B ody Report WT/DS486/AB/R  
EU – Poultry Meat (China)  Panel Report, European Union – Measures Affecting Tariff Concessions on Certain 
Poultry Meat Products , WT/DS492/R  and Add.1, adopted 19 April 2017   
Guatemala – Cement I  Appellate Body Report, Guatemala – Anti-Dumping Investigation Regarding 
Portland Cement from Mexico , WT/DS60/AB/R , adopted 25 November 1998, DSR 
1998:IX, p. 3767  
India – Additi onal Import 
Duties  Panel Report, India – Additional and Extra -Additional Duties on Imports from the 
United States , WT/DS360/R , adopted 17 November 2008, as reversed by 
Appellate Body Report WT/DS360/AB/R, DSR 2008:XX, p. 8317  
Indonesia – Autos  Panel Report, Indonesia – Certain Measures Affecting the Automobile Industry , 
WT/DS54/R , WT/DS55/R , WT/DS59/R , WT/DS64/R , Corr.1 and Co rr.2, adopted 
23 July 1998, and Corr.3 and Corr.4, DSR 1998:VI, p. 2201  
Korea – Various Measures 
on Beef  Panel Report, Korea – Measures Affecting Imports of Fresh, Chilled and Frozen 
Beef, WT/DS161/R , WT/DS169/R , adopted 10 January 2001, as modified by 
Appellate Body Report WT/DS161/AB/R, WT/DS169/AB/R, DSR 2001:I, p. 59  
Korea – Various Measures 
on Beef  Panel Report, Korea – Measures Affecting Imports of Fresh, Chilled and Frozen 
Beef, WT/DS161/R , WT/DS169/R , adopted 10 January 2001, as  modified by 
Appellate Body Report WT/DS161/AB/R, WT/DS169/AB/R, DSR 2001:I, p. 59  
Turkey – Rice Panel Report, Turkey – Measures Affecting the Importation of Rice , WT/DS334/R , 
adopted 22 October 2007, DSR 2007:VI, p. 2151  
US – Carbon Steel  Appellate Body Report, United States – Countervailing Duties on Certain 
Corrosion -Resistan t Carbon Steel Flat Products from Germany , WT/DS213/AB/R  
and Corr.1, ado pted 19 December 2002, DSR 2002:IX, p. 3779  
US – Continued Suspension  Appellate Body Report, United States – Continued Suspension of Obligations in 
the EC – Hormones Dispute , WT/DS320/AB/R , adopted 14 November 2008, DSR 
2008:X, p. 3507  
US – Continue d Suspension  Panel Report, United States – Continued Suspension of Obligations in the EC – 
Hormones Dispute , WT/DS320/R  and Add.1 to Add.7, adopted 14 November 
2008, as modified by Appellate Body Report WT/DS320/AB/R, DSR 2008:XI, p. 
3891 
US – Continued Zeroing  Appellate Body Report, United States – Continued Existence and Application of 
Zeroing Methodology , WT/DS350/AB/R , adopted 19 February 20 09, DSR 
2009:III, p. 1291  
US – COOL  Panel Reports, United States – Certain Country of Origin Labelling (COOL) 
Requirements , WT/DS384/R  / WT/DS386/R , adopted 23 July 2012, as modified 
by Appellate Body Reports WT/DS384/AB/R / WT/DS386/AB/R, DSR 2012:VI, p. 
2745 
US – Corrosion -Resistant 
Steel Sunset Review  Appellate Body Report, United States – Sunset Review of Anti -Dumping Duties 
on Corrosion -Resistan t Carbon Steel Flat Products from Japan , WT/DS244/AB/R , 
adopted 9 January  2004, DSR 2004:I, p. 3  
US – Countervailing and 
Anti-Dumping Measures 
(China)  Appellate Body Report, United States – Countervailing and Anti -Dumping 
Measures on Certain Products from China , WT/DS449/AB/R  and Corr.1, adopted 
22 July 2014 , DSR 2014:VIII, p. 3027  
US – Countervailing 
Measures (China)  Appellate Body Report, United States – Countervailing Duty Measures on Certain 
Products from China , WT/DS437/AB/R , adopted 16 January 2015 , DSR 2015:1, 
p. 7 
US – Gambling  Appellate Body Report, United States – Measures Affecting the Cross -Border 
Supply of Gambling and Betting Services , WT/DS285/AB/R , adopted 20 April 
2005, DSR 2005:XII, p. 5663 (and Corr.1, D SR 2006:XII, p. 5475)  
US – Gambling (Article 22.6 
– US) Decision by the Arbitrator, United States – Measures Affecting the Cross -Border 
Supply of Gambling and Betting Services – Recourse to Arbitration by the United 
States under Article 22.6 of the DSU , WT/DS285/ARB , 21 December 2007, DSR 
2007:X, p. 4163  WT/DS511/ R 
 
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  Short title  Full case title and citation  
US – Gasoline  Panel Re port, United States – Standards for Reformulated and Conventional 
Gasoline , WT/DS2/R , adopted 20 May 1996, as modified by Appellate Body 
Report WT/DS2/AB/R, DSR 1996:I, p. 29  
US – Large Civil Aircraft (2nd 
complaint)  Appellate Body Report, United States – Measures Affecting Trade in Large Civil 
Aircraft (Second Complaint) , WT/DS353/AB/R , adopted 23 March 2012, DSR 
2012:I, p. 7  
US – Large Civil Aircraft  (2nd 
complaint) (Article 21.5 – 
EU) Panel Report, United States – Measures Affecting Trade in Large Civil Aircraft 
(Second Complaint) – Recourse to Article 21.5 of the DSU by the European Union , 
WT/DS353/RW  and Add.1, circul ated to WTO Members 9 June 2017  
US – OCTG (Korea)  Panel Report, United States – Anti-Dumping Measures on Certain Oil Country 
Tubular Goods from Korea , WT/DS488/R  and Add.1, adopted 12 January 2018  
US – Oil Country Tubular 
Goods Sunset Reviews  Appellate Body Report, United States – Sunset Reviews of Anti -Dumping 
Measures on Oil Country Tubular Goods from Argentina , WT/DS268/AB/R , 
adopted 17 December 2004, DSR 2004:VII, p. 3257  
US – Sectio n 301 Trade Act  Panel Report, United States – Sections 301 -310 of the Trade Act of 1974 , 
WT/DS152/R , adopted 27 January 2000, DSR 2000:II, p. 815  
US – Tuna II (Mexico) 
(Article 22.6 – US) Decision by the Arbitrator, United States – Measures Concerning the Importation, 
Marketing and Sale of Tuna and Tuna Products – Recourse to Article 22.6 of the 
DSU by the United States , WT/DS381/ARB , 25 April 2017  
US – Upland Cotton  Appellate Body Report, United States – Subsidies on Upland Cotton , 
WT/DS267/AB/R , adopted 21 March 2005, DSR 2005:I, p. 3  
US – Upland Cotton  Panel Report, United States – Subsidies on Upland Cotton , WT/DS267/R , Add.1 
to Add.3 and Corr.1, adopted 21 March 2005, as modified by Appellate Body 
Report WT/DS267/AB/R, DSR 2005:II, p. 299  
US – Upland Cotton (Article 
21.5 – Brazil)  Panel Report, United States – Subsidies on Upland Cotton – Recourse to Article 
21.5 of the DSU by Brazil , WT/DS267/RW  and Corr.1, adopted 20 June 2008, as 
modified by Appellate Body Report WT/DS267/AB/RW, DSR 2008:III, p. 997  
US – Wool Shirts and 
Blouses  Appellate Body Report, United States – Measure Affecting Imports of Woven Wool 
Shirts and Blouses from India , WT/DS33/AB/R , adopted 23 May 1997, and 
Corr.1, DSR 1997:I, p. 323  
US – Wool Shirts and 
Blouses  Panel Report, United States – Measure Affecting I mports of Woven Wool Shirts 
and Blouses from India , WT/DS33/R , adopted 23 May  1997, upheld by Appellate 
Body Report WT/DS33/AB/R, DSR 1997:I, p. 343  
US – Zeroing (Japan) 
(Article 21.5 – Japan)  Appellate Body Report, United States – Measures Relating to Zeroing and Sunset 
Reviews – Recourse to Article 21.5 of the DSU by Japan , WT/DS322/AB/RW , 
adopted 31 August 2009, DSR 2009:VIII, p. 3441  
 
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  LIST OF  EXHIBITS FREQUENTLY REFERRED TO IN THIS REPORT  
Exhibit  No. Short Title Title 
USA-7 China's Working Party 
Report  Report on the Working Party on the Accession of China 
WT/ACC/CHN/49 (October 1, 2001).  
USA-10/CHN -10B 2004 Grain Opinion  State Council Opinion on the Further Deepening the Reform 
of Grain Circulation, (State Council Guo Fa [2004] No. 17, 
issued May 23, 2004).  (English Translation)  
USA-12/CHN -9B 2004 Grain Distribution 
Regulation  Regulation on the Administration of Grain Distribution (Order 
of the State Council No. 407, adopted at the 50th executive 
meeting of the State Council on May 19, 2004, issued May 
26, 2004, first amended July 18, 2013, by Order of the State 
Council No. 638, further amended on February 6, 2016, by 
Order of the S tate Council No. 666).  (English Translation)  
USA-18 China's Statistical 
Yearbook, Table 12 -10, 
(2016)  National Bureau of Statistics of China, China 's Statistical 
Yearbook (2016), Table 12 -10:Output of Major Farm Products 
(publishing 2015 data), available:  
http://www.stats.gov.cn/tjsj/ndsj/2016/indexeh.htm . 
USA-20/CHN -18B 2012 Wheat Annual 
Notice  Notice on Raising the Wheat Minimum Procurement Price for 
2012 (Fa Gai Dian [2011] No. 250), 28 September 2011 . 
(English translation)  
USA-21/CHN -93B 2013 Wheat Annual Notice  Notice on Raising the Wheat Minimum Purchase Price for 2013 
(National Development and Reform Commission, Ministry of 
Finance, Ministry of Agriculture, State Administration of 
Grain, Agricultural Development Bank of China, Fa Gai Jia Ge 
[2012]  No. 3171, issued October 16, 2012).  (English 
Translation)  
USA-22/CHN -20B 2014 Wheat Annual Notice  Notice on Raising the Wheat Minimum Procurement Price for 
2014 (Fa Gai Dian [2013] No. 205), 12 October 2013 . 
(English translation)  
USA-23/CHN -21B 2015 Wh eat Annual Notice  Notice on Announcing the Minimum Procurement Price for 
Wheat for 2015 (Fa Gai Jia Ge [2014] No. 2302), 16 October 
2014 (English translation) (hereinafter "2015 Wheat MPP 
Announcement") . 
USA-24/CHN -29B 
Revised  2012 Wheat 
Implementation Plan Notice on Issuing the Wheat Minimum Procurement Price 
Implementation Plan for 2012 (Fa Gai Jing Mao [2012] No. 
1494), 21 May 2012 . (English translation)  
USA-25/CHN -19B 
Revised  2013 Wheat 
Implementation Plan  Notice on Issuing the Wheat Minimum Procure ment Price 
Implementation Plan for 2013 (Fa Gai Jing Mao [2013] No. 
947), 20 May 2013 . (English translation)  
USA-26/CHN -30B 
Revised  2014 Wheat and Early -
Season Indica Rice 
Implementation Plan  Notice on Issuing the Wheat and Early -season Indica Rice 
Minim um Procurement Price Implementation Plan for 2014 
(Fa Gai Jing Mao [2014] No. 1026), 20 May 2014 (English 
translation) (hereinafter "2014 Wheat & Early -season Indica 
Rice Implementation Plan") . 
USA-27/CHN -28B 
Revised  2015 Wheat and Rice 
Implementation Pla n Notice on Issuing the Wheat and Rice Minimum Procurement 
Price Implementation Plan for 2015 (Guo Liang Tiao [2015] 
No. 80), 18 May 2015 . (English translation)  
USA-35 Funing, et al., Alternative 
Approach to Measure 
Comparative Advantage 
in China 's Grain Sector  
(2001)  Zhong Funing, Xu Zhigang, Fu Longbo, An Alternative 
Approach to Measure Regional Comparative Advantage in 
China 's Grain Sector , Conference of Australian Agricultural 
and Resource Economics Society (January 22 -25, 2001).  
USA-36 Chen, Current Situation 
and Trends in Production 
of Japonica Rice in China  
(2006)  Chen Wen -fu, Pan Wen -bo, Xu Zheng -jin, Current Situation 
and Trends in Production of Japonica Rice in China , Journal of 
Shenyang Agricultural University, 2006 -12, 37(6): 801 -805.
  
USA-39/CHN-23B 2012 Rice Annual Notice  Notice on Raising the Rice Minimum Procurement Price for 
2012 (Fa Gai Dian [2012] No. 17), 2 February 2012 . (English 
translation)  WT/DS511/ R 
 
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  Exhibit  No. Short Title Title 
USA-40/CHN -24B 2013 Rice Annual Notice  Notice on Raising the Rice Minimum Procurement Price f or 
2013 (Fa Gai Jia Ge [2013] No. 193), 30 January 2013 . 
(English translation)  
USA-41/CHN -25B 2014 Rice Annual Notice  Notice on Raising the Rice Minimum Procurement Price for 
2014 (Fa Gai Dian [2014] No. 34), 11 February 2014 . (English 
translation)  
USA-42/CHN -26B 2015 Rice Annual Notice  Notice on Announcing the Rice Minimum Procurement Price 
for 2015 (Fa Gai Jia Ge [2015] No. 225), 3 February 2015 . 
(English translation)  
USA-43 WT/ACC/CHN/38/Rev.3  Communication from China, WT/ACC/CHN/38/Rev.3 (July 19, 
2001).  
USA-44/CHN -34B 
Revised  2012 Early -Season Indica 
Rice Implementation Plan  Notice on Issuing the Early -Season Indica Rice Minimum 
Procurement Price Implementation Plan for 2012 (Fa Gai Jing 
Mao [2012] No. 1943, Article 2), 2 July 2012 . (English 
translation)  
USA-45/CHN -36B 
Revised  2012 Mid - to Late -Season 
Rice Implementation Plan  Notice on Issuing the Mid - to Late -Season Rice Minimum 
Procurement Price Implementation Plan for 2012 (Fa Gai Jing 
Mao [2012] No. 2726), 28 August 2012 (English translat ion) 
(hereinafter "2012 Mid -to Late -season Rice Implementation 
Plan") . 
USA-46/CHN -35B 
Revised  2013 Early -Season Indica 
Rice Implementation Plan  Notice on Issuing the Early -Season Indica Rice Minimum 
Procurement Price Implementation Plan for 2013 (Fa Gai J ing 
Mao [2013] No. 1281), 2 July 2013 (English translation) 
(hereinafter "2013 Early -season Indica Rice Implementation 
Plan") . 
USA-47/CHN -37B 
Revised  2013 Mid - to Late -Season 
Rice Implementation Plan  Notice on Issuing the Mid - to Late -Season Rice Minimum 
Procurement Price Implementation Plan for 2013 (Fa Gai Jing 
Mao [2013] No. 1836), 18 September 2013 . (English 
translation)  
USA-48/CHN -31B 
Revised  2014 Mid - to Late -Season 
Rice Implementation Plan  Notice on Issuing the Mid - to Late -Season Rice Minimum 
Procurement Price Implementation Plan for 2014 (Fa Gai Jing 
Mao [2014] No. 2104, Article 2, 15 September 2014 . (English 
translation)  
USA-52/CHN -69B 2012 TPRP Notice  Notice on Issues Relating to National Temporary Reserve 
Purchases of Corn for 2012 (State Admi nistration of Grain and 
Other Departments, Guo Liang Tiao [2012] No. 212, issued 
November 15, 2012).  (English Translation)  
USA-53/CHN -70B 2013 TPRP Notice  Notice on Issues Relating to National Temporary Reserve 
Purchases of Corn and Soybeans in the Northeast Region for 
2013 (National Development and Reform Commission, State 
Administration of Grain, Ministry of Finance, Agricultural 
Development Bank of China, Guo Liang Tiao [2013] No. 265, 
issued November 22, 2013).  (English Translation)  
USA-54/CHN -71B 2014 TPRP Notice  Notice on Issues Relating to National Temporary Reserve 
Purchases of Corn in the Northeast Region for 2014 (National 
Development and Reform Commission, State Administration 
of Grain, Ministry of Finance, Agricultural Development Bank 
of China, Guo Liang Tiao [2014] No. 254, issued November 
25, 2014).  (English Translation)  
USA-55/CHN -72B 2015 TPRP Notice  Notice on Issues Relating to National Temporary Reserve 
Purchases of Corn in the Northeast Region for 2015 (National 
Development and Reform Commission, State Administration 
of Grain, Ministry of Finance, Agricultural Development Bank 
of China, Guo Liang Tiao . (English Translation)  
USA-72 2014 China Yearbook of 
Agricultural Price Survey  China National Bureau of Statistics, China Yearboo k of 
Agricultural Price Survey (2015).  
USA-73 China's Statistical 
Yearbook, Table 12 -10 
(2015)  National Bureau of Statistics of China, China's Statistical 
Yearbook (2015), Table 12 -10: Output of Major Farm 
Products (publishing 2014 data), available: 
http://www.stats.gov.cn/tjsj/ndsj/2015/indexeh.htm.  WT/DS511/ R 
 
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  Exhibit  No. Short Title Title 
USA-74 China's Statistical 
Yearbook, Table 12 -10 
(2014)  National Bureau of Statistics of China, China's Statistical 
Yearbook (2014), Table 12 -10: Output of Major Farm 
Products (publishing 2013 data), available: 
http://www.stats.gov.cn/tjsj/ndsj/2014/indexeh.htm.  
USA-75 China's Statistical 
Yearbook, Table 13 -15 
(2013)  National Bureau of Statistics of China, China's Statistical 
Yearbook (2013), Table 13 -15: Output of Major Farm 
Products (publishing 2012  data), available: 
http://www.stats.gov.cn/tjsj/ndsj/2013/indexeh.htm . 
USA-76/CHN -33 China's Rural Statistical 
Yearbook (2016)  National Bureau of Statistics of China, China's Rural 
Statistical Yearbook (2016).  
USA-77 China Agricultural 
Statistical Reports (2011 -
2014)  Ministry of Agriculture, PRC, China Agricultural Statistical 
Reports (2011 -2014).  
USA-78 Yuzhu, Basic Knowledge 
about Japonica Rice  
(2011)  Pan Yuzhu and Li Jia, Basic Knowledge about Japonica Rice , 
Research and Consulting Department, C hangjiang Futures 
(2011).  
USA-79 China's Farm Gate Prices 
1995 to 2015  Compilation of China's Farm Gate Prices 1995 to 2015 . 
USA-80 2014 Compilation of 
Materials on Agricultural 
Product Cost and Returns  China National Development and Reform Commission, 
Compilation of Materials on Agricultural Product Cost and 
Returns (2014).  
USA-81/CHN -67 2016 Compilation of 
Materials on Agricultural 
Product Cost and Returns  China National Development and Reform Commission, 
Compilation of Materials on Agricultural Product Cost and 
Returns (2016).  
USA-87/CHN-80B 2016 Corn Notice  Notice on Proper Handling of Corn Purchase Work in 
Northeast China This Year (2016) (Guo Liang Tiao [2016] No. 
210), 19 September 2016 . (English translation)  
USA-94 Corn Prices 2012 -2017 Corn Prices 2012 -2017. 
USA-101/CHN -
107B 2016 Sinograin Corn Price 
Announcement  Price Announcement f or Corn Purchase (October 16, 2016) . 
(English Translation)  
USA-102 2017 Jilin Corn Notice  Jilin Notice on Further Proper Handling of Corn Purchase and 
Sales Work (February 3, 2017) . 
USA-104 2016 Heilongjiang Corn 
Purchase Notice  2016 Heilongjiang Corn Purchase Notice (November 10, 
2016) . 
CHN-43B Revised  2010 National Standards 
of Grain Quality Notice  Notice on Issuing the Rules on Matters Related to 
Implementing National Standards of Grain and Oil Quality 
(Guo Liang Fa [2010] No. 178), 9 November 2010 . (English 
Translation)  
CHN-49 China's Rural Statistical 
Yearbook (2013)  National Bureau of Statistics of China, China's Rural 
Statistical Yearbook (2013) . 
CHN-50 China's Rural Statistical 
Yearbook (2015)  National Bureau of Statistics of China, China's Rural 
Statistical Yearbook (2015).  
CHN-52 China's Total AMS 
Commitments  Schedule CLII, People's Republic of China, Part IV Section I: 
Domestic Support: Total AMS Commitments . 
CHN-65 OECD 2016 Document on 
Compositional 
Considerations for New 
Varieties of Rice  OECD Environment Directorate, Revised Consensus 
Document on Compositional Considerations for New Varieties 
of Rice (Oryza sativa): Key Food and Feed  Nutrients, Anti -
nutrients and Other Constituents, Paris, 2016 . 
CHN-84 April 2017 USDA GAIN 
Report  USDA, Foreign Agricultural Service, "Wheat and Rice 
Supplants Corn Area", GAIN Report Number:  CH 17017, 4 
April 2017 . 
CHN-86B 2016 Heilongjiang Corn 
Purcha se and Sale Work 
Notice  Notice on Proper Handling of the Corn Purchase and Sale 
Work in Heilongjiang Province by the General Office of the 
People's Government of Heilongjiang Province (Hei Zheng 
Ban Fa [2016] No. 119), 25 October 2016 . (English 
translation ) WT/DS511/ R 
 
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  1   INTRODUCTION  
1.1  Complaint by the United States  
1.1.  On 13 September 2016 , the United States requested consultations with China pursuant to 
Articles 1 and 4 of the Understanding on Rules and Procedures Governing the Settlement of Disputes 
(DSU), Article 19 of the Agreement on Agriculture , and Article XXII of the General Agreement on 
Tariffs and Trade 1994  (GATT 1994) with respect to the measures and claims set out below.1 
1.2.  Consultations were held on 20 October 2016.  
1.2  Panel establishment and composition  
1.3.  On 5 Decem ber 2016, the United States requested the establishment of a panel pursuant to 
Article  6 of the DSU with standard terms of reference.2 At its meeting on 25 January 2017, the 
Dispute Settlement Body (DSB) established a panel pursuant to the request of the United States in 
document WT/DS 511/8 , in accordance with Article  6 of the DSU.3 
1.4.  The Panel's terms of reference are the following:  
To examine, in the light of the relevant provisions of the covered agreements cited by 
the parties to the dispute, the mat ter referred to the DSB by the United States in 
document WT/DS511/8 and to make such findings as will assist the DSB in making the 
recommendations or in giving the rulings provided for in those agreements.4 
1.5.  On 24 June 2017, the parties agreed that the Pane l would be composed as follows:  
Chairperson:  Mr Gudmundur Helgason  
 
Members:   Mr Juan Antonio Dorantes Sánchez  
Ms Elaine Feldman  
 
1.6.  Australia, Brazil, Canada, Colombia, Ecuador, Egypt, El Salvador, the European Union, 
Guatemala, India, Indonesia, Israel, Ja pan, Kazakhstan, the Republic of Korea, Norway, Pakistan, 
Paraguay, the Philippines, the Russian Federation , the Kingdom of Saudi Arabia, Singapore, Chinese 
Taipei, Thailand, Turkey, Ukraine, and Viet Nam notified their interest in participating in the Pan el 
proceedings as third parties.  
1.3  Panel proceedings  
1.3.1   General  
1.7.  After consultation with the parties, the Panel adopted its Working Procedures5 and timetable 
on 11 August 2017.  
1.8.  The Panel held a first substantive meeting with the parties on 22 -24 January 2018. A session 
with the third parties was held on 23 January 2018. The Panel held a second substantive meeting 
with the parties on 24 -25 April 2018. On 21 June 2018, the Panel issued the descriptive part of its 
Report to the parties. The Panel issued its Interim Report to the parties on 2 November 2018 . The 
Panel issued its Final Report to the parties on 12 December 2018 . 
1.3.2   United States' request for partially open meetings  
1.9.  At the Panel's organizational meeting held on 25 July 2017, the United States enquired with 
China whether it would agree to Panel meetings being open to observation by other WTO Members 
                                                
1 See WT/DS511/1.  
2 WT/DS511/8.  
3 See WT/DSB/M/391.  
4 WT/DS511/9.  
5 See the Panel's Working Procedures in Annex A.  
 WT/DS511/ R 
 
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  and the public, either in full or in part. China disagreed with this request. The United States submitted 
a written request that panel meetings be partially opened  to the public.6 On 5 September 2017, the 
Panel decline d the United States' request.7 In its communication, the Panel informed the parties that 
the reasoning supporting the Panel's decision would be communicated to the parties in due course, 
and in any cas e, no later  than the issuance of the Interim Report.   
1.3.3   Terms of reference  
1.10.   China asserted in its first written submission that one of the measures which it understood 
the United States was challenging, the Temporary Purchase and Reserve Policy for corn, f ell outside 
the Panel's terms of reference within the meaning of Article 7.1 of the DSU, because it allegedly 
expired before the United States requested the establishment of the Panel.8 China did not request a 
preliminary ruling to be made on this issue.  
1.11.   In light of this assertion, on 7 November 2017, the Panel invited the United States to provide 
written comments on the issue by 14 November 2017. China was invited to comment on the United 
States' comments by 21 November 2017. Additionally, the Panel invited t he third parties to present 
their views, by 14 November 2017.9 
1.12.   Following an extension of the deadline, the United States provided its comments on 12 
December 2017.10 China provided its own comments on the United States' comments on 12 January 
2018.11 The parties continued to address this issue  in subsequent communications . No specific action 
was taken by the Panel regarding this issue prior to the issuance of the Interim Report.  
2  FACTUAL ASPECTS  
2.1  Measures at issue  
2.1.  In its  panel  request, the United States challenged China's provision of domestic support in 
excess of its product -specific de minimis  level, provided through market price support (MPS) for 
producers of each of wheat, Indica rice, Japonica rice and corn in 2012, 2013, 2014, and 2015, as 
reflected in, but not limited to, the legal instruments listed in the panel request.12 
2.2.  The precise characterization of the measures at issue in this dispute was subject to 
disagreement between the parties in the context of a discussion of  the Panel's terms of reference. 
We will, therefore, address the nature  of the measures in more det ail as part of our Findings in 
Section 7 of this Report.  
3  PARTIES' REQUESTS FO R FINDINGS AND RECOM MENDATIONS  
3.1.  The United States requests that the Panel find th at China has acted inconsistently with its 
obligations under  Articles 3.2 and 6.3 of the Agreement on Agriculture because the level of domestic 
support provided by China exceeds China's commitment level of "nil" specified in Section I of Part  
IV of China's  Schedule CLII. In particular, the United States asserts that China's domestic support 
in favour of agricultural producers, expressed in terms of its Current Total Aggregate Measurement 
of Support, exceeds China's final bound commitment level in 2012, 2013 , 2014, and 2015 on the 
basis of domestic support provided through market price support programmes to producers of, inter 
alia, wheat, Indica rice, Japonica rice, and corn.13 In the alternative, the United States requests that 
to the extent  China's commitme nt level of "nil" was understood as not setting out any commitment, 
the Panel find that these measures are inconsistent with China's obligation under Article 7.2(b) of 
                                                
6 United States' comments on the draft timetable and working procedures, para. 5 -6. 
7 Letter from the Panel to the parties, 5 September 2017.  
8 China's first written submission, paras. 278 -342. 
9 Letter from the Panel to the parties, 7 November 2017.  
10 Letter from the United States to the Panel, 12 December 2017.  
11 Letter from the China to the Panel, 12 January 2018.  
12 United States' request for the establishment of a panel, pp. 1 -6. See the United States' request f or 
the establishment of a panel.  
13 United States' first  written submission, para. 137. See also United States' request for the 
establishment of a panel, p.6.  
 WT/DS511/ R 
 
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  the Agreement on Agriculture, because, in 2012, 2013, 2014, and 2015, China provided dom estic 
support for wheat, Indica rice, Japonica rice, and corn in excess of its product -specific de minimis 
level of 8.5% for each product.14 The United States thus requests, pursuant to Article 19.1 of the 
DSU, that the Panel recommend that China bring its measures into conformity with its obligations 
under the Agreement on Agriculture.15 
3.2.  China requests the Panel to find that since the measure  relating to corn, as identified by China, 
expired prior to the United States' request for the establishment of the Pa nel, it falls outside the 
Panel's terms of reference. China also requests that the Panel reject the United States' claims in this 
dispute regarding measures concerning wheat, Indica rice and Japonica rice, in their entirety.16 
4  ARGUMENTS OF THE PAR TIES  
4.1.  The a rguments of the parties are reflected in their executive summaries, provided to the 
Panel  in accordance with paragraph 19 of the Working Proce dures adopted by the Panel 
(see Annexes B -1 and B -2). 
5  ARGUMENTS OF THE THI RD PARTIES  
5.1.  The arguments of Australia, B razil, Canada, Colombia, Ecuador, the European Union, India, 
Indonesia,  Japan, Kazakhstan, and the Russian Federation are reflected in their executive 
summaries, provided in accordance with paragraph 20 of the Working Procedures adopted by the 
Panel (see A nnexes C -1, C-2, C-3, C-4, C-5, C-6, C-7, C-8, C-9, C-10, C -11). Indonesia, Japan, 
Kazakhstan, and the Russian Federation did not submit written arguments to the Panel. Colombia 
and Ecuador did not submit oral arguments to the Panel. Egypt, El Salvador, Gu atemala, Israel, the 
Republic of Korea, Norway, Pakistan, Paraguay, the Philippines, the Kingdom of Saudi Arabia, 
Singapore, Chinese Taipei, Thailand, Turkey, Ukraine, and Viet Nam submitted neither written nor 
oral arguments to the Panel.  
6  INTERIM REVIEW  
6.1.  On 2 November 2018, the Panel  issued its Interim Report to the parties. On 16 November 
2018, China and the United States each submitted written requests for the Panel to review aspects 
of the Interim Report.17 On 30 November 2018 , each party submitted comme nts on the other 's 
requests for review.18 Neither party requested an interim review meeting.  
6.2.  In accordance with Article 15.3 of the DSU, this section of the  Panel 's Report addresses the  
parties' requests  for review  made at the interim review stage. We discu ss the parties' requests for 
substantive modifications below, in sequence according to the sections and paragraphs to which the 
requests pertain. The Panel modified aspects of its Report in the light of the parties' comments where 
it considered it appropri ate, as explained below. In addition to the substantive requests discussed 
below, various editorial and non-substantive  revisions  were made to the  Report, including those 
identified by the parties.  This section of the Panel 's Report constitutes an integral  part of the Panel 's 
findings.   
6.3.  In addressing the parties' requests for substantive modifications below, we are mindful of the 
specific scope, nature and purpose of interim review. With respect to the scope of our review, we 
observe that Article 15.2 of th e DSU, and paragraph 21 of the Panel's Working Procedures, provide 
parties with an opportunity to request the Panel "to review precise aspects of the interim report". In 
light of the considerations stated above, we will review our Interim Report only in li ght of the parties' 
requests that relate to its "precise aspects". We will not accept requests amounting to a party's 
attempt to re -argue its case.  
                                                
14 United States' first written submission, fn 251.  
15 United States' first written submission, para. 138.  
16 China's first written submission, para. 343.  
17 China 's comments on the Interim Report of the Panel ; United States'  comments on the Interim Report 
of the Panel . 
18 China 's comments on the United States'  comments on the Interim Report of the Panel ; United States'  
comments on China's  comments on the Inter im Report of the Panel . WT/DS511/ R 
 
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  6.4.  As an additional observation of a general nature, we would like to note that, in the "Findings" 
section of t he Report, we summarize the parties'  arguments in the manner and to the extent 
necessary and appropriate to capture our understanding for the purposes of our own assessment 
and reasoning. We underline that we have done this on the basis of a comprehensive and holistic 
reading of the parties' submissions. The parties' arguments are summarized in their own words in 
the executive summaries annexed to the Final Report.  
6.5.  The numbering of some of the paragraphs and footnotes in the Final Report may have  changed 
from the numbering in the Interim Report. The discussion below refers to the numbering in the 
Interim Report . 
6.6.  The United States requests that heading 7.2 be changed to reflect that China's Temporary 
Purchase and Reserve Policy (TPRP) for corn is "at the heart of the dispute between the parties". 
China  objects to this request and considers the text in the heading to be accurate.  The Panel has 
decided to keep the original wording, as the Panel's conclusions on the nature and characterization 
of the measures  at issue follow later on in the Report.  
6.7.  The United States requests to amend the wording of para graph  7.32 to describe more 
accurately the  United States' views on the  measures at issue in this dispute. China  submits  that the 
United States' arguments are re flected accurately in the report and that such modifications are not 
necessary.  The Panel has made textual clarifications aligning the content of the paragraph more 
closely with the language of the United States ' submission referenced in this paragraph.  
6.8.  The United States asks the Panel to indicate in para graph  7.33 that, in light of the findings 
regarding a breach of China's AMS commitments, "it is not necessary for the Panel to examine 
whether support for corn provided a further basis to conclude that Chin a breached its AMS 
commitment." China  objects to the request by the United States.  The Panel has rejected this request, 
as the reasoning provided by the United States does not correspond with the Panel's rationale for 
refraining from ruling on the corn mea sure. The Panel's reasoning is set out in section 7.2.2 of the 
Report.  
6.9.  The United States requests that citations to further panel and Appellate Body reports be add ed 
in para. 7.46 to reflect the United States' position more accurately. China  opposes the United States' 
request.  The Panel has rejected this request on the grounds that para graph  7.46 contains the Panel's 
reasoning rather than a restatement of the partie s' arguments.  The Panel has also clarified  in the 
last three sentences of that paragraph  its reasoning with regard to one Appellate Body report relied 
on by the United States . 
6.10.   China seeks to remove the references in para graph s 7.66, 7.90 and 7.95 to the so -called No. 
1 Documents being implemented by more specific legal instruments. China explains that No. 1 
Documents "provide only general guidance on a broad range of many hundreds of policy issues". In 
a similar vein, China seeks to remove a reference in pa ragraph s 7.90 and 7.95 suggesting that the 
2004 Grain Opinion and the 2004 Grain Distribution Regulation contain an authorization for adoption 
or maintenance of the TPRP for corn. The United States opposes China's request.  The Panel  has 
made textual modifi cations in these paragraphs and the related footnotes to clarify its understanding 
of the relevant regulatory framework and, in particular, the relation between No. 1 Documents, the 
2004 Grain Opinion and the 2004 Grain Distribution Regulation on the one h and, and more specific 
legal instruments , on the other hand.  
6.11.   Further to the United States' request, the Panel has clarified in footnote 155 to paragraph 
7.67 its understanding of the word "decoupling" used in Exhibit CHN -79B. 
6.12.   China requests the Panel to mo dify the wording of the first sentence of para graph  7.69 and 
delete the second sentence of that paragraph, because Exhibit USA -102 cited in that paragraph does 
not support , in China's view,  the finding that China  continued purchases of corn at significant levels 
for stock reserve purposes  past 2016. The United States objects to China's request.  The Panel's 
findings in paragraph 7.69 are not based solely on exhibit USA -102, but rather on the totality of 
evidence on  the record. Therefore, the Panel has modified the language of the se two sentences and 
added a footnote to reflect that understanding more clearly.  WT/DS511/ R 
 
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  6.13.   The Panel has made clarifying modifications to the language  of footnote 188 to paragraph  
7.78 and corrected references in that paragraph , following China's request. However, in line with 
the United States' request, the Panel has rejected China's suggestion to remove the last sentence 
in that footnote.  
6.14.   Following China's request, the Panel has added in para graph  7.88 a reference  to statements 
mentioned in China's submissions and concerning the risk of reintroduction of the corn measure.  
With regard to the same paragraph,  the Panel has rejected the United States' request to refer to the 
lack of formal termination o f the TPRP for corn, as, in the Panel's view, this argument concerns  the 
expiry of the corn measure, rather than the risk of its reintroduction.  
6.15.   Regarding paragraph 7.102, China  requests that the Panel combine items c. and d. such that 
the combined item would be read as follows: "c. Mid - to late -season Indica rice and Japonica rice: 
Liaoning, Jilin, Heilongjiang, Jiangsu, Anhui, Jiangxi, Henan, Hubei, Hunan, Guangxi, Sichuan. " We 
have accepted China's suggested revision.  
6.16.   Regarding paragraphs 7.130 and 7.132, the United States notes that Article 1 of the 
Agreement on Agriculture contains a number of definitions, many of which are unrelated to the 
present dispute. Consequently, the  United States requests a more specific reference to Article  1(a) 
and 1(h) be utilized in the mentioned paragraphs. We agree and have introduced the mentioned 
revisions.  China notes that the concurrent application of Annex 3 and the CDM in the tables of 
supporting material is not limited to Article 1(a) and 1(h) and discusses some examples. For China,  
the Panel is correct in making a general reference t o Article 1 in both instances and for this reason, 
it requests that the Panel reject the  proposed change . After assessing both parties' comments, the 
Panel decided to deny the United States' request for paragraph 7.130, but grant it for paragraph 
7.132.  
6.17.   Regarding paragraph 7.157, the United States note s that the language used appear s to 
identify the two -step c alculation process established by Article 1(a) and 1(h) of the Agreement on 
Agriculture in an imprecise manner and , therefore,  suggest s revising it. China argues that as the 
Panel noted in paragraph 7.157, Article 1(a)(ii) concerns the calculation of Curre nt AMS, while Article 
1(h)(ii) defines Current Total AMS. For this reason, China submits that the United States' suggestion 
is imprecise, and proposes a different language. The Panel introduced some modifications to improve 
the overall  clarity  of the parag raph.  
6.18.   Regarding paragraph 7.193, the United States requests modification in order to clarify that  
the Panel is comparing the external reference price used to calculate the AMS or value of market 
price support in the base period and the FERP used in subseq uent calculations.  We note that . in this 
paragraph, particularly in small romans (i), the Panel is drawing  a comparison between the base 
period and the FERP. We have introduced some revisions to enhance the clarity of the paragraph . 
6.19.   Regarding paragraph 7.2 04, China suggests that the Panel replace "construct " with "source " 
in the last sentence of this paragraph , as China 's FERP based on an average of the period 1996 -
1998 can be sourced from China 's tables of supporting materials, and need not be constructed from 
them. We have accepted this suggestion, and modified the wording accordingly.  
6.20.   Regarding paragraph 7.213, the United States suggests deleting a particular sentence 
regarding the base periods used by Members. We agree with the U nited States and have removed 
the sentence.  Consequently, there is no need to address China's comment on the same sentence.  
6.21.   Regarding paragraph 7.219, China suggests the deletion of the entirety of this paragraph as 
it considers it repetitive. The Panel n otes that this paragraph is meant to provide a brief summary 
of the parties' arguments  and it serves as an introduction before  entering into the Panel's analysis.  
For this reason, we decline China's suggestion.  
6.22.   Regarding paragraph 7.220, the United States  suggest s revisions to clarify the Panel's 
assessment of the connection between CDM and the calculations made during the base period. Since 
the Panel's statement regarding Article 1(a)(i) is correct, according to China, China  requests that 
the Panel not ac cept the United States' suggestion. We have introduce d some modifications to the 
mentioned paragraph . WT/DS511/ R 
 
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  6.23.   Regarding paragraph 7.248, China suggest s changing the word "interpreted" in the first 
sentence of this paragraph, with "considered ". We agree with  China' s suggestion.  China also 
requests that the Panel modifies the text of the fo urth sentence by replacing "China' s domestic 
support commitment level" with " a WTO Member 's domestic support commitment level".  We observe 
that the proposed modification would have  the effect of turning the Panel's analysis into a general 
statement, not necessarily limited to the case at hand. For this reason, we decline China's 
suggestion. Finally, China suggests that some revisions are introduced to the last sentence of this 
paragraph to improve its clarity . The United States  objects to China's request that the Panel delete 
the final sentence as it is helpful to retain this language.  The Panel introduced some modifications 
to this sentence.  
6.24.   Regarding paragraph 7.249, China sug gests a correction for what appears to be a 
typographical error in the first sentence of  this paragraph 7.249.  Specifically, China suggest deleting 
the term "figure " at the end of line 3.  The United States made no comments on this request.  We 
note that the  term "figure" is not a typographical error. It is meant to replace the term "the side of 
the hypothetical equation representing the Base Total AMS" in the first part of this sentence, which 
is a numerical value and not a mathematical expression. For this reason, we decline  China's 
suggestion.  
6.25.   Regarding paragraph 7.299, China requests that the Panel replace "state-owned enterprises " 
with "designated enterprises ". The United States  objects to China 's proposed change to this 
paragraph. The original  phrase is, in fact, a quotation from the United States and the relevant 
sentence has been modified to reflect this.  
6.26.   Regarding paragraphs 7.349 and 7.350, the United States requested the inclusion of a 
footnote in order to more accurately reflect the arguments of the  parties, particularly its own.  China  
does not consider it necessary that the Panel insert the new footnote proposed by the United States. 
Should the Panel wish to consider the United States' request, China opposes the change proposed 
by the United States.  We agree with the United States that additional information regarding its 
arguments was appropriate  and have therefore included the relevant information in the text of 
paragraph 7.349 and in a footnote within paragraph 7.350.  
6.27.   Regarding paragraphs 7.385, 7.394, 7.395 and 7.400, China believes that it is inaccurate to 
state that certain data regarding the volume of production of various types of rice nationally, and in 
the covered provinces, is "provided exclusively by the United States". China thus request s the Panel 
revise the relevant sentences to remove references to data "provided exclusively by the United 
States". We have declined to do so. The data being used by the Panel in those particular contexts 
was in fact provided exclusively by the United Stat es, as China did not present its own data which 
the Panel could use in this regard, as an alternative. Additionally, the fact that only the United States 
presented such data resulted in the calculation of separate MPS values for rice, based on each party's  
separate breakdown – a fact which is clearly stated before each relevant table.  
6.28.   Regarding paragraphs 7.412, 7.413 and 8.1, the United States requests that the Panel's 
articulations of its legal conclusions reflect the findings that show that China exceede d its 
commitment level of "nil" with respect  to each of the three products for which the Panel has made 
findings. China made no comments on this request. We have introduced some modifications to reflect 
this request,  except when dealing with Current Total AMS as this calculation is not product -specific.  
7  FINDINGS  
7.1  United States' request for partially open Panel meetings with the parties  
7.1.1   Procedural  background  
7.1.  At the Panel's organizational meeting, the United States enquired with China whether it would 
agree t o the Panel meetings being open to observation by other WTO Members and the public, either 
in full or in part. China disagreed with this request, resulting in the United States submitting a written 
request that  the Panel meetings be partially open.19 The pa rties submitted written comments on this 
request and on 5 September 2017, the Panel declined  the United States' request. In its 
                                                
19 United States' comments on the draft timetable and working procedures, paras. 5 -6. WT/DS511/ R 
 
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  communication, the Panel informed the parties that the reasoning supporting the Panel's decision 
would be communicated to the pa rties in due course, and in any case,  no later than the issuance of 
the Interim Report.   
7.1.2   Introduction  
7.2.  The United States argues that, under Article 18.2 of the DSU, it has the right to disclose its 
own statements to the public.20 As a result, the United Stat es suggests that the Panel adopt 
procedures to allow WTO Members and the public access to United States' statements  made  during 
the Panel meetings.21 Additionally , the United States argues, on the basis of the reasoning in 
previous disputes22, that parties who wish to disclose their statements made during the Panel 
meetings may do so, regardless of the opposing party's decision to keep its own statements 
confidential, and that the right of confidentiality of other parties would not be prejudic ed by the 
United States' decision to disclose its own statements.23 
7.3.  The United States asserts that the Appellate Body had previously decided it could grant each 
party or third party's request to disclose its own statements and answers at the oral hearing an d 
that it would not affect the rights of others to maintain the confidentiality of their statements.24 
Thus, the United States argues that the Panel in this dispute is able to grant the United States' 
request to disclose its own statements at the Panel meet ing without affecting China's right to 
maintain the confidentiality of its submissions.25 The United States notes that three recent 
proceedings "have assisted one party requesting to make its statements publicly by partially opening 
the relevant meeting": US – OCTG (Korea) ; US – Tuna II (Mexico) (Article 22.6 – US) and US – Tuna 
II (Mexico) (Article 21.5 – Mexico) .26  
7.4.  China asks that the Panel reject the United States' request for a partial opening to the public 
of the  Panel  meetings with the parties and thir d parties in these proceedings.27 To support its 
request, China argues that under the DSU, the general rule is that submissions to panels and the 
Appellate Body are confidential and that their meetings with the parties and third parties are closed 
to the pu blic.28 Despite these general rules, China notes that panels and the Appellate Body have at 
times considered and granted requests to open their meetings with the parties and third parties 
where both parties waived their right to confidentiality and requeste d that a WTO adjudicator's 
meeting be open to the public.29 China discusses a number of cases where adjudicators have refused 
to open, or partially open, meetings where one party has opposed such opening.30 For China, the 
correct approach to a WTO adjudicato r's disposition of requests to open its meeting to the public is 
to agree to such openings only where both parties agree that a meeting should be opened, and to 
provide for appropriate protection for the statements and interventions of third parties that i nvoke 
                                                
20 United States' comments on the draft timetable and working procedures, para. 6.  
21 United States' comments on the draft timetable and working proc edures, para. 6.  
22 United States' comments on the draft timetable and working procedures, para. 6 
(referring  to Appellate Body Report, US – Continued Suspension , Annex IV, para. 6).  
23 United States' comments on the draft timetable and working procedures, para. 7.  
24 United States' comments on the draft timetable and working procedures, para. 6 
(referring  to Appellate Body Report, US – Continued Suspension , Annex IV, para. 6).  
25 United States' comments on the draft timetable and working procedures, para. 7.  
26 United States' comments on the draft timetable and working procedures, para. 7.  
27 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 65.  
28 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 25.  
29 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 34.  
30 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 36  (referring to Appellate Body Report, EU – Biodiesel (Argentina) , Annex D -2, paras. 2 -3, 7; Decision by 
the Arbitrator, US – Gambling (Article 22.6 – US), para. 2.29 and; Panel Report , US – Upland Cotton 
(Article  21.5 – Brazil) , paras. 8.16 -8.20).  
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  their right to preserve the confidentiality of their statements and observations .31 Exceptions to this 
general approach should, if allowed at all, be limited to very particular circumstances.32 
7.5.  In addition, China contends that the Appellate Body has pr eviously considered "whether the 
request of the participants to forego confidentiality protection satisfies the requirements of fairness  
and integrity  that are the essential attributes of the appellate process and define the relationship 
between the Appell ate Body and the participants".33 China refers to US – Tuna II (Mexico)  and argues 
that the arbitrator in that dispute recognized potential due process implications.34 Finally, China 
argues that partially open meetings in these proceedings would have to be l imited not only to the 
United States' statements of its own positions that do not disclose China's position, but it would also 
likely have to be limited by the existence of certain information that is designated as confidential. 
China contends that in thes e circumstances, it is likely that there would be very little of the United 
States' statements and interventions that could be shown to the public in a partially open meeting, 
and that what little there is may not be comprehensible. China thus claims that the complexity of 
the factual questions involved, and the fact that certain information would likely have to be 
designated as confidential, means that there would be very little by way of enhanced transparency 
from a partially open meeting.  
7.6.  For China, bal ancing the requirements for confidentiality and the integrity of the dispute 
settlement process against any enhanced transparency, therefore, strongly suggests that the Panel 
should decline the United States' request for a partially open meeting.35 Finally,  China claims that 
none of the special considerations that have exceptionally supported a request by only one party for 
a partial opening to the public of a WTO adjudicator's meeting is present in these proceedings.36 
7.1.3   Panel's analysis  
7.1.3.1   Introduction  
7.7.  The United  States' request is based on two main components: (i) the proposition that under 
Article 18.2 of the DSU, the United States has the right to disclose its statements to the public37, 
and (ii) the proposition that, in previous instances, panels and the Appellate Body have agreed to 
hold open meetings, either in full or in part. This last component, in turn, is divided in to two 
arguments: the "underlying rationale" for previous decisions by panels and the Appellate Body to 
open their meetings to observati on by other WTO Members and the public38 and the claim that in 
three recent proceedings , the adjudicators  have "assisted one party requesting to make its 
statements publicly by partially opening the relevant meeting", namely, the panel in US – OCTG 
(Korea) , the arbitrator in the  DSU Article 22.6 proceedings in  US – Tuna II (Mexico)  and the 
compliance panels in the same dispute .39  
7.1.3.2   Article 18.2 of the DSU  
7.8.  We begin by noting that the United States contends that Article 18.2 of the DSU confers a right 
on the Uni ted States, as a party to the dispute, to disclose statements of its own position to the 
public.40 The United States suggests that the Panel adopt procedures to allow WTO Members and 
                                                
31 China' s comments on the United States' comments on the draft timetable and working procedures, 
para. 38.  
32 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 39.  
33 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 32 (referring to Appellate Body Report, US – Continued Suspension/Canada – Continued Suspension , 
Annex IV, para. 6 (emphasis and underlining added)).  
34 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 33 (referring to Decision by the Arbitrator, US – Tuna II  Mexico  (Article 22.6 – US), para. 2.26).  
35 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 53.  
36 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 56.  
37 United States' comments on the draft timetable and working procedures, para. 6.  
38 United States' comments on the draft timetable and working proced ures, para. 6.  
39 United States' comments on the draft timetable and working procedures, para. 7.  
40 United States' comments on the draft timetable and working procedures, para. 6.  
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  the public access to the United States' statements during the Panel meetin gs.41 China argues that 
under the DSU, the general rule is that submissions to panels and the Appellate Body are 
confidential, that their meetings with the parties and third parties are closed to the public, and that 
this general rule should be upheld in th is case.42 China also contends that the particularly sensitive 
matters that will arise in this dispute make it imperative that the Panel apply the general rule that 
meetings are opened to the public only where there is agreement by both parties .43  
7.9.  We observ e that in  principle there is nothing in the text of the DSU establishing an explicit right 
for WTO Members to have fully or partially open meetings. On the contrary, the Working Procedures 
in Appendix 3 of the DSU foresee that panels meet in closed session44, suggesting that the default 
situation is that panel meetings are closed to the public. We are nonetheless mindful that pursuant 
to Article  12.1 of the DSU, a panel may depart from the Working Procedures in Appendix 3, provided 
that the panel consults th e parties to the dispute. In our view, this provision grants panels the power 
to adopt procedural rules that depart from or complement those already contained in Appendix 3. 
Thus, a panel can depart from the default situation where panel meetings are held in closed session 
and consequently grant a request from a party to hold an open meeting, in full or in part. However, 
the text of the DSU leave s this decision to the discretion of the panel and does not present it as an 
absolute right of the parties to a dispute.  
7.10.   Article 18.2 provides as follows:  
Article 18  
Communications with the Panel or Appellate Body  
… 
2. Written submissions to the panel or th e Appellate Body shall be treated as 
confidential, but shall be made available to the parties to the dispute. Nothing in this 
Understanding shall preclude a party to a dispute from disclosing statements of its own 
positions to the public. Members shall tre at as confidential information submitted by 
another Member to the panel or the Appellate Body which that Member has designated 
as confidential. A party to a dispute shall also, upon request of a Member, provide a 
non-confidential summary of the information  contained in its written submissions that 
could be disclosed to the public.  
7.11.   We agree with the United States that this provision sets out that nothing in the DSU "shall 
preclude a party to a dispute from disclosing statements of its own positions to the pu blic". However, 
it does not follow that because a Member has this right, a panel is compelled to open its meetings 
to the public, in full or in part. In our view, by denying this request the Panel would not be prohibiting  
the United States from disclosing statements of its own positions to the public. Neither is the Panel 
depriving  the United States of the right conferred in the second sentence of Article 18.2. We do not 
see how, by declining this request, the Panel would be unreasonably impinging on the me ntioned 
right as the United States would remain free to exercise its right in a variety of ways.  
7.12.   In this connection, we observe that statements of the United States' position made in Panel 
meetings could be disclosed by the United States in ways that do not require the Panel to take an 
active role.45 Indeed, we do not read the second sentence of Article 18.2 of the DSU as necessarily 
involving panels in a Member's exercise of this right or directing panels to assist Members in 
                                                
41 United States' comments on the draft timetable and working procedures, para. 6.  
42 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 25.  
43 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 49.  
44 Appendix 3 to the DSU, para. 2 states that: "The panel shall meet in closed session. The parties to 
the dispute, and interested parties, shall be present at the meetings only when invited by the panel to appear 
before it."  
45 We note that the arbitrator in US – Tuna II (Mexico) (Article 22.6 – US) reached a similar conclusion 
in this regard: " Indeed, we recall in this respect that even if we were to deny the United States' request, the 
United States could still exercise its right to disclose statements of its own positions in a different form or on a 
different occasion". Decision by the Arbitrator, US – Tuna II (Mexico) (Article 22.6 – US), fn 28.  
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  disclosing their position to t he public. In addition, we observe that as a matter of practice, some 
Members in certain disputes use the right set forth in Article 18.2 and routinely publish submissions 
made to panels, including their oral statements, on publicly available sites, regard less of whether 
the meetings were open to the public.46 Thus, we do not perceive Article 18.2 of the DSU to be 
dispositive of our assessment of the United States' request. In this vein, to the extent that the United 
States argues that Article 18.2 of the DS U indicates that the Panel should grant the mentioned 
request, we find the United States' reliance on this provision to be misplaced.  
7.1.3.3   Prior disputes addressing open or partially open hearings  
7.13.   We now move to assess the United States' arguments regarding pre vious instances where 
WTO adjudicators have authorized open or partially open hearings. The United States contends that 
when the Appellate Body in US – Continued Suspension  was presented with a request by the parties 
to open the meeting to viewing by the p ublic, it had concluded that each party has a right to maintain 
confidentiality of its own statements, and therefore also the ability to request that the confidentiality 
of the proceeding be lifted for its statements.47 Further, the United States submits th at the Appellate 
Body went on to reason that such a request by one party does not affect another Member's right to 
confidentiality.48 According to the United States, the Appellate Body in that dispute held that "oral 
statements and responses to questions by  third participants wishing to maintain the confidentiality 
of their submissions will not be subject to public observation".49 For the United States, as the 
Appellate Body decided it could grant each party or third party's request to disclose its own 
statem ents and answers at the oral hearing and that it would not affect the rights of others to 
maintain the confidentiality of their statements, the Panel here can grant the United States' request.  
7.14.   China submits that the Appellate Body in that case considered that, as a general matter, WTO 
adjudicators would require requests from both parties to open to the public their meetings with the 
parties or third parties because the relationship of confidentiality concerns both parties collectively. 
China thus submits t hat the United States is wrong when it implies that the Appellate Body's 
reasoning provided for a party -by-party and third party -by-third party assessment.50 Regarding the 
integrity of the dispute settlement proceedings, China contends that the Appellate Bo dy considered 
"whether the request of the participants to forego confidentiality protection satisfies the 
requirements of fairness  and integrity  that are the essential attributes of the appellate process and 
define the relationship between the Appellate Bo dy and the participants".51 China also refers to US 
– COOL , and submits that the panel opened its meeting with the parties to the public following a 
joint request by the United States and Canada, a request to which Mexico, as a co -complainant, did 
not objec t.52 China further refers to the compliance panel in US – Large Civil Aircraft (2nd complaint) 
(Article 21.5 – EU), which according to China adopted, at the request of both parties, procedures for 
viewing by the public of those parts of its meetings with the parties and third parties that did not 
concern confidential information .53  
7.15.   We begin by noting that in US – Continued Suspension , all three participants in the appeal, 
namely, Canada, the European Communities and the United States, presented a request t o allow 
public observation of the oral hearing and only some of the third participants opposed this request. 
In other words, there was agreement among all of the parties to the original panel proceedings – 
the participants in the appeal process – to have a  fully open hearing. This stands in stark contrast 
                                                
46 The Panel does not express any view on the consistency of this practice with the DSU.  
47 United States' comments on the draft timetable and wor king procedures, para. 6 (referring to 
Appellate Body Report, US – Continued Suspension , Annex IV, para. 6).  
48 United States' comments on the draft timetable and working procedures, para. 6.  
49 United States' comments on the draft timetable and working proc edures, para. 6 (referring to 
Appellate Body Report, US – Continued Suspension , Annex IV, para. 11(b)).  
50 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 29.  
51 China's comments on the United States' comm ents on the draft timetable and working procedures, 
para. 32 (referring to Appellate Body Report, US – Continued Suspension/Canada – Continued Suspension , 
Annex IV, para. 6 (emphasis and underlining added)).  
52 China's comments on the United States' comment s on the draft timetable and working procedures, 
para. 35 (referring to Panel Report , US – COOL , paras. 1.11 -13). 
53 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 35 (referring to Panel Report, US – Large Civil Aircraft (Article 21.5 – EU), para. 1.20 and Annex A -3, 
para. 6. See similarly Appellate Body Report, US – Zeroing (Japan) (Article 21.5 – Japan) , paras. 17 -19, Annex 
II, paras. 1, 4, 6 -8). 
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  to the present case where there is no agreement between the two parties to the dispute to open the 
meetings to the public. In our view, this difference is significant. It goes to the nature of the request 
itself: in US _ Continued Suspension  the Appellate Body was facing a request to have a fully open 
meeting while in this case we are confronted with a request for partially open meetings. While the 
issue before the Appellate Body there was how to accom modate such request in the light of the 
opposition of some third participants, in this case the issue is whether to grant a similar request 
when one party does not consent to opening the meetings even partially. Indeed, the Appellate Body 
emphasized the fa ct that it was a joint request of the participants that led to the request being 
granted.54  
7.16.   The Appellate Body stated there that the confidentiality requirement in Article 17.10 of the 
DSU is more properly understood as operating in a relational manner as there are different sets of 
relationships that are implicated in appellate proceedings, including (i) a relationship between the 
participants and the Appellate Body and (ii) a relationship between the third participants and the 
Appellate Body.55 The Appella te Body reasoned that the confidentiality requirement was intended to 
foster the system of dispute settlement under conditions of fairness, impartiality, independence and 
integrity and that in that case, as the participants had jointly requested authorizat ion to forego 
confidentiality protection for their communications with the Appellate Body at the oral hearing, such 
request did not extend to any communications, nor touch upon the relationship, between the third 
participants and the Appellate Body, and th us, the right to confidentiality of third participants vis-à-
vis the Appellate Body was not implicated by the joint request.56 The Appellate Body ultimately 
concluded that it had the power to exercise control over the conduct of the oral hearing, including 
authorizing the lifting of confidentiality at the joint request of the participants as long as this did not 
adversely affect the rights and interests of the third participants or the integrity of the appellate 
process.57 
7.17.   We thus do not agree with the United  States' interpretation of the Appellate Body's 
statements. Unlike this dispute, the request before the Appellate Body was a joint request. We 
therefore fail to see how the cited precedent lends the support the United States claims it does. To 
us, the Appe llate Body's assessment in that case can also be interpreted as buttressing China's 
argument that meetings have been opened to the public whenever the request was accepted by all 
parties .  
7.18.   In any event, the Appellate Body concluded that it had the power to  authorize such a request, 
a conclusion that, by analogy, goes in line with our reading of Article 12.1 of the DSU. In our view, 
this provision similarly grants us the power to depart from the default situation where panel meetings 
are held in closed sessi on and consequently allows us to grant a request from a party to hold an 
open meeting, in full or in part. However, and importantly, the Appellate Body did not conclude that 
it was or could be compelled to grant such a request by virtue of the parties' rig ht to disclose 
statements of their own position.  
7.19.   We now move to assess the United States' arguments regarding previous instances where 
partially open hearings have been authorized. The United States argues that three recent 
proceedings have "assisted one party requesting to make its statements publicly by partially opening 
the relevant meeting", namely, the panel in US – OCTG (Korea) , the arbitrator in the DSU Article 
22.6 proceedings in US – Tuna II (Mexico)  and the compliance panels in the same dispute .58 In US 
– OCTG (Korea) , the United States argues that the panel agreed that it may open its meetings with 
                                                
54 "In this case, the participants have jointly requested  authorization to forego confidentiality protection 
for their communications with the appellate body at the oral hearing"; "Thus, the Appellate Body has the power 
to exercise control over the conduct of the oral hearing, including authorizing the lifting o f confidentiality at the 
joint request of the participants as long as this does not adversely affect the rights and interests of the third 
participants or the integrity of the appellate process"; and "The request for public observation of the oral 
hearing has been made jointly by the three participants , Canada, the European Communities, and the United 
States. As we explained earlier, the Appellate Body has the power to authorize a joint request by the 
participants to lift confidentiality , provided that this  does not affect the confidentiality of the relationship 
between the third participants and the Appellate Body, or impair the integrity of the appellate process." 
Appellate Body Report, US – Continued Suspension , Annex IV, paras 6, 7 and 10 (emphasis added ). 
55 Appellate Body Report, US – Continued Suspension , Annex IV, para. 6.  
56 Appellate Body Report, US – Continued Suspension , Annex IV, para. 6.  
57 Appellate Body Report, US – Continued Suspension , Annex IV, para. 7.  
58 United States' comments on the draft timetable and working procedures, para. 7.  
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  the parties and third parties to the public, either in whole or in part, subject to appropriate 
procedures to be adopted by the panel after consulting with the parties and third parties.59 In US – 
Tuna II (Mexico) (Article 22.6 – US), the United States asserts that the arbitrator held that it "may, 
upon request by a party, authorize that party to lift the confidentiality, by way of delayed viewing, 
of its own statements made during the Arbitrator's meeting with the parties".60 Finally, the United 
States refers to the compliance panels in the US – Tuna II (Mexico) (Article 21.5 - Mexico) and US 
– Tuna II (Mexico) (Article 21.5 – United States)  proceedings, w here the United States notes that it 
was agreed that panels "may, upon request by a party or third party, authorize that party, or third 
party, to lift the confidentiality [of the proceedings], by way of delayed viewing, of its own 
statements made during t he Panel's meeting with the parties, or the special session for third 
parties".61 
7.20.    China, on the other hand, refers to several cases in which, it alleges, panels and the Appellate 
Body have generally rejected the open hearing requests where only one party requested the opening 
of a meeting to the public, and the other party objected to t hat request. China argues that in EU – 
Biodiesel (Argentina) , the Appellate Body rejected an EU request to open its meeting with the 
participants and third participants, inter alia , because the other participant, Argentina, had objected 
to the request .62 Similarly, China contends that in US – Gambling (Article 22.6 – US), the arbitrator 
declined a request by the United States to open its meeting with the parties, because Antigua, the 
other party to those proceedings, had opposed opening the meeting.63 China a lso refers  to US – 
Upland Cotton (Article 21.5 – Brazil)  noting that the compliance panel rejected a US request that 
only those parts of the panel meeting be open to the public during which the United States presented 
its position.64 These disputes, their r easoning and their findings have been taken into consideration 
by the Panel, and have helped to formulate the conclusions below.  
7.21.   When the United States submitted its request for a partially open meeting, and the Panel took 
its decision to deny the United S tates' request, two of three of the panel reports the United States 
relies on, i.e. the panel report in US – OCTG (Korea)  and the second compliance panel reports in US 
– Tuna II (Mexico) , had not yet been circulated to Members. In this regard, we note Chin a's 
contention that for these reasons, it was not in a position to address the reasoning of those panels.65 
We had similar  difficulties because of the confidential nature of those disputes at the time we took 
our decision. In this connection, we find it pro blematic that a party refers to proceedings in which 
reports are still confidential and to which that party may have access but neither the other party nor 
the Panel has. This hampers the other party's, in this case China's, right of defence and the Panel' s 
ability to conduct an objective assessment of the matter. Consequently, our decision to deny the 
United States' request was not informed by the United States' arguments regarding these disputes.66  
7.22.   According to the United States, the arbitrator in US – Tuna II (Mexico) (Article 22.6 – US) 
held that it "may, upon request by a party, authorize that party to lift the confidentiality, by way of 
delayed viewing, of its own statements made during the Arbitrator's meeting with the parties".67 We 
                                                
59 United States' comments on the draft timetable and working procedures, para. 7.  
60 United States' comments on the draft timetable and working procedures, para. 7 (referring to  US – 
Tuna II (Mexico) (Article 22.6 – US) Annex A -1 para. 3).  
61 United States' comments on the draft timetable and working procedures, para. 7.  
62 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 36 (referring to Appellate Body Report, EU – Biodiesel (Argentina) , Annex D -2, paras. 2 -3, 7).  
63 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 36 (referring to Decision by the Arbitrator, US – Gambling (Article 22.6 – US), para. 2.29).  
64 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 36 (referring to Panel Report , US – Upland Cotton (Article 21.5 – Brazil) , paras. 8.16 -8.20).  
65 China's comments on the United States' comments on the draft timeta ble and working procedures, 
para. 57.  
66 We do note, however, in issuing our supporting reasoning to the parties in this Report,  that the 
reports in those proceedings have now been circulated to Members. In reviewing them, we were able to 
confirm our reason ing as they did not, in our view, support the United States' contentions. In particular, we 
observe that the panel in US – OCTG (Korea)  did not grant the United States' request to hold a partially open 
meeting,  contrary to what the United States' seemed to have suggested. Thus, at the time we took our 
decision to the decline the United States' request, there had only been one dispute in which a partially open 
meeting had been authorized: US – Tuna II (Mexico) (A rticle 22.6 – US) and the second compliance panels in 
this same dispute.  
67 United States' comments on the draft timetable and working procedures, para. 7 (referring to  
Decision by the Arbitrator,  US – Tuna II (Mexico) (Article 22.6 – US) Annex A -1 para. 3) . 
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  note that these we re the first proceedings where a partially open meeting has ever been authorized, 
as before, panels only agreed to open their meetings to the public whenever there was consent by 
all the parties, or at least, no opposition to such request.68 In its reasonin g, the arbitrator considered 
that in principle, it had the power to authorize the United States to disclose statements of its own 
positions (but not those of Mexico) to the public through a partially open arbitrator's meeting, even 
if Mexico opposed the Un ited States' request. The arbitrator elaborated and stated that one party 
cannot simply veto another party's request that it be authorized to disclose statements of its own 
positions.69 However, we also observe that the arbitrator stated that it did not fol low that it must 
automatically  grant the United States' request.70 Notably, it stated that although the United States 
has an autonomous right to disclose statements of its own positions to the public, that right is not 
absolute. Rather, that right found lim itation in Mexico's right not to have statements of its own 
positions disclosed by the United States during any public parts of the arbitrator's meeting.  
7.23.   From the above statements, we observe that the arbitrator's reasoning gave an important 
role to the r ight that each Member has to disclose statements of its own position pursuant to 
Article  18.2 of the DSU. By framing the legal question as one predominantly dealing with the right 
of the United States to disclose statements of its own position, the arbitra tor was able to address 
the fact that Mexico expressly opposed such request being granted. Accord ing to the arbitrator, a 
party cannot "simply veto another party's request that it be authorized to disclose statements of its 
own positions".71 However, and as  we explained in paragraph  7.11 above , we do not find that a 
party's right to disclose statements of its own position is dispositive for our decision not to open  our 
meetings to the public. This is even more so in a situation where one party directly opposes the 
request. In our view, this right can be exercised autonomously by each Member and should not be 
confused or conflated with the question of whether a panel  should hold an open meeting, in full or 
in part. Consent from the parties whose statements could be made public if a panel decides to hold 
open meetings may well be a necessary condition to do so, but it may not be a sufficient condition, 
as it remains wi thin the discretion of the panel to grant such a request.  
7.24.   In this vein, we agree with the arbitrator that a party cannot simply veto another party's 
decision  to disclose statements of its own position to the public. Article 18.2 of the DSU does not 
condition a Member's right to disclose its statements on the approval of another Member. However, 
we do not fully understand why the arbitrator framed this issue as  being about whether a party can 
veto another party seeking authorization from the panel  to disclose statements of its own position. 
As discussed earlier, Article 18.2 of the DSU does not require that a party seek authorization  from a 
panel to disclose its  statements. To us, the nature of the United States' request in that case was 
that of a partial opening of the arbitrator's meeting, a decision which required  authorization from 
the arbitrator. We see this as different from merely requesting that it be all owed to disclose its own 
statements, a matter that did not need the arbitrator's authorization. For these reasons, we are 
unable to fully agree with the arbitrator's approach in current assessment of the United States' 
request.  
7.25.   We are nonetheless mindful that Members' rights to confidentiality and to disclose statements 
of their own position under the DSU play an important role in our assessment of the United States' 
request. However, this is merely a part of the legal issue before us. The overarching issu e we face 
is whether a panel should use its discretion and open its meeting for public observation, even 
partially, in the light of one party opposing such opening.  
7.1.3.4   Concluding considerations  
7.26.   We recall that the Appellate Body in US – Continued Suspension stated that  the confidentiality 
requirement was intended to foster the system of dispute settlement under conditions of fairness, 
                                                
68 In this regard, we recall US – Continued Suspension/Canada – Continued Suspension , at both the 
Panel and Appellate Body stage, the panel in US – COOL , and the US – Large Civil Aircraft (Article 21.5 – EU) 
compliance panel, where meetings were opened wi th the consent of both parties. In contrast, the Appellate 
Body in EU – Biodiesel (Argentina) , the compliance panel in US – Upland Cotton (Article 21.5 – Brazil) , the 
arbitrator in US – Gambling (Article 22.6 US)  and the panel in US – OCTG (Korea)  all reje cted the request for 
open hearings where one party did not consent.  
69 Decision by the Arbitrator, US – Tuna II (Mexico) (Article 22.6 – US), para. 2.21.  
70 Decision by the Arbitrator, US – Tuna II (Mexico) (Article 22.6 – US), para. 2.24.  
71 Decision by the Arbitrator, US – Tuna II (Mexico) (Article 22.6 – US), para. 2.21.  
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  impartiality, independence and integrity72, and that it had the power to authorize requests for holding 
fully open hearings, prov ided that this does not affect the confidentiality in the relations between 
the third participants and the Appellate Body, or impair the integrity of the appellate process.73 We 
thus are of the view that in the process of exercising our discretion and decid ing whether to grant 
or not the United States' request we should weigh and balance several factors, including fairness, 
independence, due process, the rights and interests of the parties to the dispute, and the integrity 
of the panel process.74 
7.27.   In this conn ection, we note that the United States argues that the opening of panel meetings 
to observation serves both to heighten public confidence in the WTO and to build familiarity in those 
Members that do not participate often in the dispute settlement system by  letting them observe the 
high-quality work of panels. According to the United States, numerous WTO panels have opened 
their proceedings to the public and those experiences have been beneficial for Members and the 
public, and thus ultimately for the WTO.75 It thus seems that the United States has a general interest 
in the transparency of the dispute settlement mechanism so as to heighten the public confidence in 
the WTO system and to help other Members build familiarity with it.  
7.28.   On the other hand, China subm its that a proper  balancing of the requirements for 
confidentiality and the integrity of the dispute settlement process, against any potential enhanced 
transparency, strongly suggests that the Panel should decline the United States' request for a 
partially  open meeting.76 For China, this dispute involves complex factual questions, and China states 
that it anticipates that certain of the evidence it provides will have to be designated confidential. 
China contends that in these circumstances, it is likely that  there would be very little of the United 
States' statements and interventions that could be shown to the public in a partially open meeting, 
and that what little there is may not be comprehensible.77  
7.29.   We are thus required to balance the possible enhanced t ransparency of the dispute settlement 
mechanism that could heighten public confidence in the WTO system and help other Members build 
familiarity with it, on the one hand, and China's confidentiality rights and the integrity of the panel 
process, on the oth er. In this connection, we are mindful of China's arguments that the complexity 
of the factual questions involved, and the fact that certain information would likely have to be 
designated confidential, may mean that any transparency resulting  from partiall y open meetings 
might actually be limited.78  
7.30.   Regarding the integrity of the panel process, and, in particular, the due process considerations 
arising from the divergent interests of the parties, we believe that not having consent from all the 
parties is a factor that should be heavily weighed by the Panel. Although we are well aware that 
partially open meetings might be an option in situations where one party does not agree to hold a 
                                                
72 Appellate Body Report, US – Continued Suspension , Annex IV, para. 6.  
73 Appellate Body Report, US – Continued Suspension , Annex IV, para. 7.  
74 We note that the arbitrator in US – Tuna II ( Mexico) (Article 22.6 – US) also mentioned some similar 
factors that may be of use in this process: namely (i) a non -disclosing party's right to confidentiality protection 
of statements of its own position; (ii) due process; (iii) the prompt settlement of disputes; (iv) and the careful 
and efficient discharge, or the integrity, of the adjudicative function. Decision by the Arbitrator, US – Tuna II 
(Mexico) (Article 22.6 – US), para. 2.31.  
75 United States' comments on the draft timetable and working procedures, para. 5.  
76 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 53.  
77 China's comments on the United States' comments on the draft timetable and working procedures, 
para. 52. We note that during t he organizational meeting, the United States expressed its opinion that it does 
not agree with China's characterization that this matter is particularly complex.  
78 We understand that this is so because if the Panel decides to partially open its meetings, i t would 
most likely have to follow an approach similar to that chosen by the arbitrator in US – Tuna II (Mexico) 
(Article  22.6 – US) and adopt procedures that guarantee that China's confidentiality rights are duly protected. 
In particular, we note that tho se procedures would most likely envisage having a delayed public broadcast of 
the Panel's meeting so as to be able to perform a redaction process of the United States' statements to avoid 
any inadvertent disclosure of China's arguments and position. We are  mindful that in implementing such 
redaction procedures, the possibility exists that the resulting recording which is to  be shown to the public may 
be fragmented and discontinuous. This result could make the arguments of the United States difficult to foll ow 
and ultimately defeat the purpose of opening the hearing to the public. In other words, guaranteeing China's 
confidentiality rights might require a redaction process following which the United States' interventions at the 
meetings could be difficult for  the public audience to understand.  We can thus see that, in practice, a partially 
open meeting may not be conducive to enhance the transparency of the dispute settlement mechanism.  
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  fully open meeting, as was signalled by the arbitrator in US – Tuna II (Me xico) (Article 22.6 – US), 
we do not necessarily agree with the reasoning presented by the arbitrator in those proceedings, as 
discussed previously.79 In our view, if the Panel is going to exercise its discretionary powers to adopt 
procedural rules, consent  by the parties involved in the dispute should be an important factor to 
weigh in its decision.  
7.31.   For the foregoing reasons, and especially (i) because the potential enhanced transparency 
resulting from the Panel opening its meeting partially to the public might be limited in practice, and 
(ii) due to China's express opposition to such request, we find that the balance weighs against 
granting the United States' request. We thus decline to exercise our discretion to grant the request 
to deviate from the stand ard working procedures  in order  to hold partially  open meetings in th is 
disput e.  
7.2  The measures challenged in this dispute and China's claim relating to the expiry of 
one of the measures  
7.32.   In its first written submission, China asserts that one of the measures which China understood 
the United States was challenging – the Temporary Purchase and Reserve Policy (TPRP) for corn – 
expired prior to the panel request and, as a result,  it falls outside the Panel's terms of reference.80 
The United States dispute s that the measure expired  and argues, among other things, that China 
incorrectly identified the TPRP for corn as one of the measure s challenged in this dispute.81 The 
United States maintains that it "has challenged  in its panel request  the domestic support  provided 
to agricultural producers in China during the years 2012, 2013, 2014 and 2015, including support 
provided to producers of wheat, Indica rice, Japonica rice and corn. "82 The United States considers 
the TPRP for corn to constitute a series of legal instruments, rather than a measure.83 As a result, 
in the United States' view, a modification or expiry of the TPRP for corn "would not necessarily bring 
a Member's domestic support in conformity with its commitments", if the level of domestic support 
excee ds the commitment level.84 In addition, the United States maintains that, in any event, the 
corn measure did not expire and that the Panel should make findings and recommendations with 
regard to that measure.  
7.33.   As a result, a disagreement ensued between the p arties on the nature and characterization 
of the measures challenged by the United States and the alleged expiry of the measure relating to 
corn. Th ese are  two preliminary issues which the Panel must address before turning to the substance 
of the United St ates' claims. Accordingly, we will first consider the parties' arguments relating to the 
measures at issue in this dispute. Depending on the outcome of this analysis, we will turn to the 
question of whether the Panel should refrain from ruling on any of th e challenged measures.  We 
then outline the main characteristics of the measures that will be  subject to the Panel's assessment.  
7.2.1   The measures challenged by the United States  
7.34.   The United States refers to its panel request, arguing that it "describes four measures at 
issue: the 'domestic support provided by China' (or 'China's domestic support in favour of agricultural 
producers') in each of the years 2012, 2013, 2014 and 2015".85 In that regard, the United States 
distinguishes between the measures it is cha llenging and the arguments it makes to support its 
claims.86 The United States explains that the reference to "China's domestic support in favour of 
agricultural producers" in the panel request relates to the challenged measures and the reference to 
                                                
79 See paragraph 1.22.  above.  
80 China's first written submission, paras. 27 8-282. 
81 United States' opening statement at the first meeting of the Panel, para. 48; United States' comments 
on China's challenge to the Panel's terms of reference, para. 15.  
82 United States' comments on China's challenge to the Panel's terms of referenc e, para. 8.  
83 United States' opening statement at the first meeting of the Panel, para. 50; United States' comments 
on China's challenge to the Panel's terms of reference, para. 26.  
84 United States' opening statement at the first meeting of the Panel, para. 50; United States' comments 
on China's challenge to the Panel's terms of reference, para. 26.  
85 United States' comments on China's challenge to the Panel's terms of reference, para. 14; United 
States' second written submission, para. 14.  
86 United Sta tes' second written submission, paras. 15 -16. United States' response to Panel question 
No. 23, paras. 95 -99. 
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  "domest ic support provided to producers of, inter alia , wheat, Indica rice, Japonica rice and corn" is 
a preview of the United States' arguments.87 
7.35.   China submits that the United States' challenge in this dispute is limited to the provision of 
market price support to wheat, rice and the TPRP for corn.88 China refers  in that regard  to the United 
States' panel request listing legal instruments which establish market price support for wheat, Indica 
rice, Japonica rice and corn.89 China also quotes the United States' firs t written submission, which 
mentions market price support program mes in the context of the challenged measures and the 
object of the dispute.90 
7.36.   China further conte nds that the United States' characterization of the measures at issue as 
the "level of domesti c support" or "China's provision of domestic support" to agricultural producers, 
is contradicted by the language of the panel request.91 In addition, China claims that if the measures 
were indeed identified by the United States in such broad terms, it would  fail to meet the specificity 
requirement in Article 6.2 of the DSU.92 In China's view, the term "provision of domestic support to 
Chinese agricultural producers" would cover various types of measures that constitute domestic 
support, such as "amber box", " blue box" and "green box" measures, with regard to which the United 
States has not presented substantive arguments.93 This, according to China, would raise serious due 
process concerns, as China considers itself unable to defend domestic support measures fo r products 
other than those covered by the United States' panel request and arguments put forward by the 
United States.94 China also states that, under these circumstances, it would be inappropriate for the 
Panel to issue recommendations with regard to such  broadly  defined measures, because the 
responding Member would not know what steps to take in order to bring them into compliance.95 
7.37.   In response to China's arguments alleging lack of precision in the identification of the 
measure s at issue , the United State s maintains that it identified a specific measure challenged in 
the dispute, which meets the requirement of an act or an omission of a Member.96 The United States 
further explains its characterization of the measure at issue with the fact that the Agreement  on 
Agriculture seeks to limit the amount of domestic support a Member may provide, without prohibiting 
any specific form of domestic support.97 
7.38.   Article 11 of the DSU requires a panel to make an objective assessment of the matter referred 
to it for adjudica tion by the DSB.98 This matter consists of two elements: the specific measures at 
issue and the legal basis of a complaint, both of which have to be identified in the request for the 
establishment of a panel.99 It is the panel request that must sufficiently precisely identify the 
                                                
87 United States' second written submission, paras. 18 -19 (quoting United Sates' request for the 
establishment of a panel, p. 6).  
88 China's first w ritten submission, paras. 62 and 281; China's comments on the United States' 
comments on China's challenge to the Panel's terms of reference, para. 28.  
89 China's comments on the United States' comments on China's challenge to the Panel's terms of 
reference , paras. 15 -21; China's second written submission, paras. 26 -33. 
90 China's comments on the United States' comments on China's challenge to the Panel's terms of 
reference, paras. 8 -12; China's second written submission, paras. 34 -37. 
91 China's comments on the United States' comments on China's challenge to the Panel's terms of 
reference, paras. 13 -14. 
92 China's comments on the United States' comments on China's challenge to the Panel's terms of 
reference, para. 24 (citing Appellate Body Reports, US – Zeroin g (Japan) (Article 21.5 – Japan) , para. 116; and 
EC and certain member States – Large Civil Aircraft , para. 645); China's opening statement at the first meeting 
of the Panel, para. 87; China's second written submission, para. 45.  
93 China's comments on the United States' comments on China's challenge to the Panel's terms of 
reference, para. 24; China's comments on the United States' response to Panel question No. 59 (second 
substantive meeting). Due to an anomaly in the numbering of the Panel's questions to the parties at the 
Panel's second substantive meeting with the parties (where a small number of questions inadvertently 
overlapped those of the first meeting), references to question Nos. 52 -74 will include a reference to the 
substantive meeting at which t hey were put to the parties, as demonstrated above.  
94 China's second written submission, para. 65.  
95 China's second written submission, para. 66.  
96 United States' second written submission, paras. 23 -24. 
97 United States' second written submission, para. 25 ; United States' response to Panel question No. 1.  
98 See also Article 7.1 of the DSU.  
99 Article 6.2 of the DSU. Appellate Body Report, Guatemala – Cement I , para. 72.  
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  measure at issue in a dispute.100 Without an adequate identification  in a panel request, a measure 
will not form part of the matter covered by the panel's terms of reference.101 
7.39.   The panel request, and the identification of the challenged  measures in particular, fulfil an 
important due process role. As the Appellate Body noted in EC – Selected Customs Matters , "[t]he 
word ' specific ' in Article 6.2 establishes a specificity requirement regarding the identification of the 
measures that serve s the due process objective of notifying the parties and the third parties of the 
measure(s) that constitute the object of the complaint. "102 The content of a panel request should 
thus allow the respondent to discern the matter that is referred for adjudicat ion.103 
7.40.   In light of the parties' disagreement over the measures at issue in this dispute, the Panel has 
to examine the content of the panel request and determine the measures identified therein. In doing 
so, the Panel has to carefully analyse the language of the panel request read as a whole and taking 
into account the attendant circumstances.104 We recall in this connection that while a party's 
subsequent submissions during the panel proceedings cannot cure a defect in a panel request , they 
may be consulted to confirm or clarify the meaning of the words used in the panel request.105 
7.41.   The United States' panel request  reads, in relevant part:  
China provides domestic support in favor of its agricultural producers. The level of 
domestic support China provides is in excess of its commitment level of "nil" specified 
in Section I of Part IV of its Schedule CLII because, for example, China provides 
domestic support in excess of its product -specific de minimis  level of 8.5 percent for 
each of wheat, Indica rice, Japonica rice, and corn.106 
7.42.   The request goes on to list a number of legal instruments "through which China provides 
domestic support in favour of agricultural producers , including support in favour of producers  of 
wheat, Indica rice, Japonica rice, and corn, operating collectively or separately."107 The listed 
instruments are grouped in five categories: general legal instruments concerning China's gra in 
policies and those relating more specifically to market price support for producers of wheat, Indica 
rice, Japonica rice and corn.108 The panel request further reads that such legal instruments "include 
but [are] not limited to" the ones listed in the req uest.109 
7.43.   Finally, following a reference to Articles 3.2 and 6.3 Agreement on Agriculture, the panel 
request contains the following statement:  
In particular, China 's domestic support in favor of agricultural producers, expressed in 
terms of its current Total Aggregate Measurement of Support ( "Total AMS "), exceeds 
China's final bound commitment level in 2012, 2013, 2014, and 2015 on the basis of 
domestic support provided to producers of, inter alia, wheat, Indica rice, Japonica rice, 
and corn. The United States  further considers that,  to the extent applicable, these 
measures  are inconsistent with China's obligation under Article 7.2(b) of the Agriculture 
Agreement, because in 2012, 2013, 2014 and 2015, China provides domestic support 
                                                
100 Appellate Body Report, Dominican Republic – Import and Sale of Cigarettes , para. 120; P anel Report, 
Canada – Wheat Exports and Grain Imports , para. 6.10.  
101 Appellate Body Report, Dominican Republic – Import and Sale of Cigarettes , para. 120.  
102 Appellate Body Reports, EC – Selected Customs Matters , para. 152; and US – Carbon Steel , 
para. 126. 
103 Appellate Body Report, US – Continued Zeroing , para. 168.  
104 Appellate Body Reports, China – HP-SSST (Japan) , para. 5.13; EC and certain member States – 
Large Civil Aircraft , para. 787; US – Carbon Steel , para. 127; US – Oil Country Tubular Goods Sunset Reviews , 
paras. 164 and 169; US – Continued Zeroing , para. 161; and US – Zeroing (Japan) (Article 21.5 – Japan) , 
para. 108.  
105 Appellate Body Reports US – Carbon Steel , para. 127; China – Raw Materials , para. 220; US – 
Countervailing and Anti -Dumping Measures (China) , para. 4.9; US – Countervailing Measures (China) , 
para. 4.20. 
106 United States' request for the establishment of a panel, p. 1. (footnote omitted)  
107 United States' request for the establishment of a panel, p. 1.  
108 United States' request for  the establishment of a panel, pp. 1 -6. 
109 United States' request for the establishment of a panel, p. 1.  
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  for wheat, Indica rice, Japonica rice, and corn in excess of its product -specific de minimis  
level of 8.5 per cent for each product.110 
7.44.   Looking at the above relevant excerpts of the United States' panel request, we note the claim 
that China's provision of domestic support exceeds China's 8.5% de minimis level and, as a result, 
China's commitment level of nil, relates to four separate produ cts, namely wheat, Indica rice, 
Japonica rice and corn. While the panel request contains the terms "for example" and "inter alia " in 
describing the product scope of the United States claims, the request is silent on any other products 
for which China might  have provided domestic support and whether the level of such support 
exceeded the de minimis  limit with regard to those products. In a similar vein, we find the reference 
to "any amendments, or successor, or replacement, or implementing measures" vague an d not 
allowing the identification of other specific measures  that could be challenged in this dispute .111 As 
a result, an objective reading of the panel request suggests that the United States was not 
challenging  China's provision of domestic support with re gard to agricultural products other than 
wheat, Indica rice, Japonica rice and corn.  
7.45.   Further, with the exception of six general policy documents, the panel request refers 
exclusively to legal instruments concerning China's market price support for producer s of wheat, 
Indica rice, Japonica rice and corn. We note in that regard that market price support is only one type 
of mechanism , which  a Member can avail itself of to provide domestic support to agricultural 
producers, another being, for example, direct pa yments. Yet, the United States does not refer to 
any other kind of domestic support. This is in stark contrast to the total of 40 specific legal 
instruments listed in the panel request concerning market price support  and excluding the numerous 
implementing  regulations mentioned in the footnotes.  
7.46.   Against that backdrop, we are not persuaded by  the United States' argument that the 
references in the panel request to legal instruments concerning market price support for wheat, 
Indica rice, Japonica rice and corn  merely "preview " the United States' arguments, rather than 
identify the measures at issue. We agree with the United States that a panel request may include 
anticipation of complainant's arguments and that such arguments should not be interpreted to 
narrow  the scope of the measures or claims.112 However, whether references to legal instruments 
could be read as a preview of  the complainant's arguments largely depends on the language of the 
panel request and the context in which they are mentioned. In particular , we bear in mind that the 
parties' disagreement pertains to the fundamental question of the measures at issue in the dispute. 
In this sense, the question before us is different from the one raised in EC – Selected Customs 
Matters  and relied on b y the United States .113 In that case, the findings relied on by the United 
States did not relate to the identification of the measures at issue.114 Rather, they addressed the 
respondent's argument that listing certain areas of application of the measures resul ted in limiting 
the matter to only such areas .115 
7.47.   In our view, the specific legal instruments listed in the panel request do not merely constitute 
an anticipation of the United States' arguments, but inform the nature and content  of the challenged 
measures. This is because, taken together, these legal instruments contain essential elements of 
the measures and inform other parties to the dispute of the specific type of domestic support that 
the United States challenge s. An objective reading of the panel reques t thus suggests that the United 
States' challenge is centred on a single means of domestic support, namely market price support, 
for producers of four agricultural products – wheat, Indica rice, Japonica rice and corn.  
7.48.   Our reading of the panel request fin ds confirmation in the United States' first written 
submission, which starts with the following words:  
Each year, the People 's Republic of China ( "China" ) provides a significant level of 
domestic support to its agricultural producers through a variety of s ubsidy programs 
                                                
110 United States' request for the establishment of a panel, p. 6.  
111 See Appellate Body Report, EC – Selected Customs Matters , para. 152, fn 369.  
112 United States' second written submission, para. 19 (quoting Appellate Body Report, EC – Selected 
Customs Matters , para. 153 ) 
113 United States' second written submission, para. 19.  
114 Appellate Body Report, EC – Selected Customs Matters , paras. 151 -152. 
115 Appellate Body Report, EC – Selected Customs Matters , para. 153 . 
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  and other measures. This dispute addresses a single means of agricultural support, 
"market price support," which China utilizes to support farmer incomes and increase 
production for basic agricultural products, including wheat, Indica rice,  Japonica rice, 
and corn.116 
7.49.   Later, in the same submission the United States  explains that:  
This dispute focuses on a single form of agricultural domestic support – market price 
support – which China provides to basic agricultural products including wheat, I ndica 
rice, Japonica rice, and corn.117 
7.50.   Similar ly to the panel request, while the use of the word "including" in the two paragraphs of 
the United States' first written submission cited above might  suggest that the United States' claims 
could  be challeng ing support provided to other products, the United States uses language that 
excludes such an interpretation . In particular , the United States' first written submission reads  that: 
The United States demonstrates that China has acted inconsistently with its ob ligations 
pursuant to Articles 3.2 and 6.3 of the Agriculture Agreement on the basis of the level 
of domestic support provided through China 's market price support measures in favor 
of wheat, Indica rice, Japonica rice, and corn, viewed separately or colle ctively.118 
7.51.   China's "market price support measures" referred to in the above statement are described in 
more detail in three sections of the United States' first written submission, entitled "China's Wheat 
Market Price Support Program", "China's Indica Rice and Japonica Rice Market Price Support 
Measures" and "China's Corn Market Price Support Measures". The above unambiguous statements 
confirm our reading of the panel request as addressing four separate measures, namely domestic 
support in the form of market  price support for each of wheat, Indica rice, Japonica rice and corn.119 
These are thus the measures at issue in this dispute. In the light of this conclusion, the Panel does 
not need to address China's  alternative  arguments relating to the alleged lack of specificity of the 
measure  at issue, if it was  identified as provision by China of domestic support to agricultural 
producers.  
7.52.   The United States is challenging China's measures relating to wheat, Indica rice, Japonica rice 
and corn on the basis of evidence  provided for years 2012, 2013, 2014 , and 2015.120 We will, 
therefore, conduct our assessment with regard to domestic support provided  through market price 
support  to producers of the relevant products  in China .121 
7.2.2   China's terms of reference claim raised with regard to the corn measure  
7.53.   China claims that the corn measure identified in the panel request by the United States 
expired prior to the request for the establishment of the Panel, and thus cannot be a measure at 
issue in this dispute.122 China maintains that  it first announced the termination of the TPRP for corn 
in March 2016 and put in place new measures consisting of direct payments to farmers and market -
                                                
116 United States' first written submission, para. 1. (footnote omitted) (emphasis added)  
117 United States' first written submission, para. 14.  
118 United States' first written submission, para. 1 0. 
119 We note that in its submissions subsequent to the first written submission, the United States refers 
to a different measure, namely China's domestic support to agricultural producers. However, such references 
may have been influenced by China's claim relating to the expiry of the measure relating to corn, raised in 
China's first written submission. The Panel thus approaches such references with caution, in line with the 
Appellate Body's guidance that a panel may consult "in particular the first written  submission of the 
complaining party […] in order to confirm the meaning of the words used in the panel request". Appellate Body 
Report, US – Carbon Steel , para. 127.  
120 The data serving as the basis for our ass essment can be found in Annex D . 
121 China submi ts that it would be appropriate for the Panel to consider the 2016 data in the assessment 
of consistency of China's measures. However, the United States' claims relate to years 2012, 2013, 2014 and 
2015, for which the evidence was available at the time of the request for the establishment of a panel. We will 
thus limit our assessment to the operation of the measures during these years.  
122 China's first written submission, paras. 337 -338. 
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  based purchases  of corn shortly thereafter.123 China contends that the TPRP for corn was last applied 
during the 2015 harvest season and has not been reintroduced since.124 
7.54.   Relying on the Appellate Body report in EC – Chicken Cuts , China goes on to argue that 
Article  6.2 requires that for a measure to fall within the panel's terms of reference, it must exist at  
the time of the establishment of the panel.125 According to China, such a temporal limitation is 
consistent with Article 3.7 of the DSU, mentioning withdrawal of the measure concerned as "the first 
objective of the [WTO] dispute settlement system."126 China f urther cites several panel and Appellate 
Body reports, with a view to demonstrating that a panel can only exceptionally make findings on a 
measure that had expired prior to its establishment and none of these exceptions applies in the case 
at hand.127 China also relies on the Appellate Body report in US – Certain EC Products  to argue that 
a panel cannot make a recommendation on an expired measure.128 
7.55.   As regards the new measures, allegedly introduced in 2016, China argues that they 
substantially differ from the TPRP for corn in several important aspects: (i) the direct payments to 
farmers operate in a fundamentally different manner compared to the TPRP for corn; (ii) they 
encourage limiting the production of corn; (iii) they do not involve an AAP and do not inter fere with 
price discovery in the market for corn.129 In particular, the absence of the AAP constitutes, according 
to China, an essential difference between the TPRP for corn on the one hand  and the subsequently 
introduced subsidies for Chinese farmers and pu rchases of  corn, on the other hand .130 China further 
points to fluctuations in the corn market price in China following the alleged termination of the TPRP 
for corn, as proof that China had ceased to provide market price support to corn farmers.131  
7.56.   In respons e to China's claim, the United States primarily argues that the TPRP for corn is not 
the measure identified in the panel request and that its alleged expiry does not affect the United 
States' case against China.132 We have already concluded that the United S tates' panel request 
identifies four measures, relating to the provision of domestic support in the form of a market price 
support to producers of each of wheat, Indica rice, Japonica rice and corn. In light of this conclusion, 
we will focus in this sectio n on the arguments concerning the alleged expiry of the measure related 
to corn.  
7.57.   The United States submits that it is for China to demonstrate that the challenged measure 
ceased to exist and that China failed to do so.133 In addition, the United States puts forward a 
number of arguments, to support its contention that the measure relating to corn did not expire. 
The United States points out that the overarching legal framework authorizing purchases of corn at 
administered prices, in particular the 2004 Grain Distribution Regulation and the 2004 Grain Opinion, 
continue to exist.134 According to the United States, this general legal framework reflects an intention  
by the Chinese Government  to protect interests of domestic farmers and provides for an explicit 
legal authority to adopt measures relating to market price support for China's agricultural 
producers .135 
7.58.   Further, the United States contends that the documents submitted by China and relating to 
China's policy of corn purchases adopted in 2016 "do not state that  the TPRP has been terminated 
or that China will no longer engage in purchase and temporary storage of corn."136 The United States 
argues  that China continues to store and auction corn purchased under  the 2012, 2013, 2014 and 
                                                
123 China's first written submission, paras. 290 -295; China's comments on the United States' comments 
on China's challenge to the Panel's terms of reference, paras. 68 -75; China's response to Panel question No. 1.  
124 China's first written submission, para. 296.  
125 China's first written submission, paras. 324 -327; second written s ubmission, paras. 74 -77. 
126 China's first written submission, para. 328 (quoting Article 3.7 of the DSU).  
127 China's first written submission, paras. 330 -335. 
128 China's second written submission, para. 97.  
129 China's first written submission, paras. 298 -322. 
130 China's comments on the United States' comments on China's challenge to the Panel's terms of 
reference, paras. 62 -65. China's response to Panel question No. 1.  
131 China's second written submission, paras. 127; China's responses to Panel question Nos. 1 an d 2. 
132 See section 7.2.1 above.  
133 United States' second written submission, para. 48.  
134 United States' comments on China's challenge to the Panel's terms of reference, paras. 36 -37. 
135 United States' first written submission, paras. 17 -20, second written submission, paras. 42 -43; 
United States' responses to Panel question Nos. 1, 24, 70.  
136 United States' comments on China's challenge to the Panel's ter ms of reference, paras. 39 -41. 
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  2015 TPRP.137 For the United States, this shows that the corn measure continues to be applied.  The 
United States also points to the similarities between the objectives and structure of the legal 
instruments implementing the TPRP policy and the new Chinese measures, as well as the fact that 
China continues to purchase corn at quantities similar to those in years prior to the alleged expiry 
of the corn  measure .138 Additionally, t he United States contests the market -based  nature of corn 
prices in China, as these have remaine d above the international prices.139 
7.59.   Moreover, the United States submits evidence allegedly reflecting government -administered 
purchase prices, at which the China Grain Reserve Corporation (Sinograin) and Chinatex procured 
corn in the Inner Mongolia province  in October 2016.140 In the United States' view, Exhibits USA -
101 and USA -104, read in the light of other evidence reflecting Sinograin's substantial role on the 
grain market, show that Sinograin, and possibly other Chinese state -owned enterprises, conducted  
purchases of corn at administered prices on behalf of the government.141 The United States points 
to the similarity between the corn purchases taking place prior to and after the alleged expiry of the 
corn measure. These similarities include the entities in volved, the purchasing and pricing 
requirements, policy objectives, announcement and display requirements, lending and storage 
requirements.142 According, to the United States, this evidence, considered together, shows that 
China has not terminated its provi sion of domestic support in the form of market price support to 
corn producers.143 
7.60.   In reaction to the evidence produced by the United States, China maintains that the prices  
listed  in Exhibits USA -101 and USA -104 were communicated internally within the struc tures of the 
enterprises, based on market data published by the State Administration of Grain and adjusted in 
line with fluctuations of the market price.144 With respect to Sinograin more specifically, China argues 
that the company has been given no mandate by the government to purchase corn at government -
determined prices and that other, private actors active on the Chinese corn market issue similar 
documents.145 To that end, China submits a number of notices by Sinograin and other grain -
purchasing companies, which, in China's view, show that passing on pricing information by a 
company to its local branches is a common business practice.146 
                                                
137 United States' comments on China's challenge to the Panel's terms of reference, para. 38.  
138 United States' comments on China's challenge to the Panel's terms of reference, paras. 42 -48; 
United States' second written submiss ion, paras. 50 -52; United States' response to Panel question No. 2  
139 United States' second written submission, para. 54. 
140 2016 Sinograin Corn Price Announcement , (Exhibit USA -101/CHN -107B);  2016 Heilongjiang Corn 
Purchase Notice, (Exhibit  USA-104).  
141 United States' comments on China's responses to Panel question Nos. 52 and 56 (second substantive 
meeting).  
142 United States' response to Panel question No. 55 (second substantive meeting).  
143 United States' opening statement at the first meeting of the Panel, paras. 59 -62; United States' 
response to Panel question No. 52 (second substantive meeting).  
144 China's response to Panel question No. 52 (second substantive meeting).  
145 China's response to Panel question No. 52 (second substantive meeting).  
146 2016 N ew Corn Purchase Guidance Price Notice, by SinoGrain headquarter, 3 November 2016 
(English translation), (Exhibit CHN -111B); 2016 New Corn Purchase Guidance Price Notice, by SinoGrain 
headquarter, 15 November 2016 (English translation), (Exhibit CHN -112B);  2016 New Corn Purchase Guidance 
Price Notice, by SinoGrain headquarter, 16 November 2016 (English translation), (Exhibit CHN -113B); 2016 
New Corn Purchase Guidance Price Notice, by SinoGrain headquarter, 22 November 2016 (English translation), 
(Exhibit CH N-114B); 2016 New Corn Purchase Guidance Price Notice, by SinoGrain headquarter, 30 November 
2016 (English translation), (Exhibit CHN -115B); 2016 New Corn Purchase Guidance Price Notice, by SinoGrain 
headquarter, 7 December 2016 (English translation), (Exh ibit CHN -116B); 2016 New Corn Purchase Guidance 
Price Notice, by SinoGrain headquarter, 14 December 2016 (English translation), (Exhibit CHN -117B); 2016 
New Corn Purchase Guidance Price Notice, by SinoGrain headquarter, 21 December 2016 (English translatio n), 
(Exhibit CHN -118B); 2016 New Corn Purchase Guidance Price Notice, by SinoGrain headquarter, 28 December 
2016 (English translation), (Exhibit 119B); 2016 New Corn Purchase Guidance Price Notice, by SinoGrain Inner 
Mongolia branch, 16 November 2016 (Engl ish translation), (Exhibit CHN -120B); 2016 New Corn Purchase 
Guidance Price Notice, by SinoGrain Inner Mongolia branch, 22 November 2016 (English translation), (Exhibit 
CHN-121B); 2016 New Corn Purchase Guidance Price Notice, by SinoGrain Inner Mongolia br anch, 30 
November 2016 (English translation), (Exhibit CHN -122B); 2016 New Corn Purchase Guidance Price Notice, by 
SinoGrain Heilongjiang branch, 7 December 2016 (English translation), (Exhibit CHN -123B); 2016 New Corn 
Purchase Guidance Price Notice, by Si noGrain Heilongjiang branch, 14 December 2016 (English translation), 
(Exhibit CHN -124B); 2016 New Corn Purchase Guidance Price Notice, by SinoGrain Heilongjiang branch, 21 
December 2016 (English translation), (Exhibit CHN -125B); 2016 New Corn Purchase Guid ance Price Notice, by 
SinoGrain Heilongjiang branch, 29 December 2016 (English translation), (Exhibit CHN -126B); 2016 New Corn 
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  7.61.   Additionally, the United States argues that China's claim regarding the expiry of the corn 
measure overlooks the context of a dispute involving calculation of the AMS. This is because an 
assessment of Members' compliance with domestic support commitments involves a retrospective 
examination of the levels of support.147 According to the United States, a panel considering such 
claims should focus its assessment on the operation of the measures during the period for which the 
measures were challenged and for which the relevant data is available.148 Otherwise a dispute over 
domestic support would turn into a constantly moving target, wh ere a panel would need to update 
its assessment with the most recent numbers becoming available.149 The United States relies in that 
regard on the report in Korea – Various Measures on Beef , in which the panel and the Appellate Body 
addressed domestic suppor t provided prior to the establishment of the panel.150 In a similar vein, 
the United States relies on the Appellate Body report in China – Raw Materials to argue that a panel 
should make findings on a recurring measure evidenced in annual legal instruments t hat may have 
ceased to exist prior to the establishment of a panel.151  
7.62.   Finally, the United States submits that, in any event, the alleged expiry of the corn measure 
should not prevent the panel from making findings and recommendations with regard to that 
measure. This is because the measure has been identified in the panel request and, as such, forms 
part of the matter referred to the Panel by the DSB for adjudication.152 All the more so, as domestic 
support claims are necessarily based on historical data and findings with regard to such information 
are necessary in order to fulfil the objective of securing a positive solution to a dispute, as enshrined 
in Article 3.7 of t he DSU.153 
7.63.   In their arguments, the parties raise two distinct, albeit related, issues. First, the parties 
disagree on the factual question of whether the corn measure expired in 2016, as claimed by China. 
Second, they have different views on whether the Pane l should make findings and recommendations 
with regard to a measure that has ceased to exist. We will, therefore, start by addressing the factual 
question relating to the alleged expiry of the corn measure. Should we find that the measure did 
indeed expire , we will then determine whether to make findings and, eventually, a recommendation 
on that measure.  
7.2.2.1   Whether the corn measure has expired  
7.64.   Both parties have submitted extensive facts and arguments relating to the alleged expiry of 
the corn measure. Under th ese circumstances, our task will essentially be to balance all evidence on 
record and decide whether the said measure has expired, as claimed by China, recalling that the 
original burden of establishing  inconsistency  of a measure  rests on the United States .154 In particular, 
we will compare China's new corn policy with the challenged corn measure to determine whether 
they have the same essence and, by implication, whether we can address the new measure in our 
findings.  
7.65.   Our review of the record evidence suppor ts China's assertion that it reformed its corn policy 
by terminat ing the provision of market price support to corn producers following the 2015 corn 
harvest  and replacing it with direct payments and purchases that do not involve an AAP. The reform 
                                                
Purchase Guidance Price Notice, by SinoGrain headquarter, 26 October 2016 (English translation), (Exhibit 
CHN-127B); Corn Purchas e Price of Cargill Biochemical Limited, 12 December 2016 (English translation), 
(Exhibit CHN -128B); Corn Purchase Price of Cargill Biochemical Limited, 14 December 2016 (English 
translation), (Exhibit CHN -129B); Corn Purchase Price of Cargill Biochemical L imited, 19 December 2016 
(English translation), (Exhibit CHN -130B); Corn Purchase Price of Cargill Biochemical Limited, 20 December 
2016 (English translation), (Exhibit CHN -131B).  
147 United States' comments on China's challenge to the Panel's terms of refer ence, paras. 17 -29; 
United States' second written submission, paras. 30 -32; United States' responses to Panel questions Nos. 4, 5 
and 7.  
148 United States' second written submission, para. 31.  
149 United States' response to Panel question No. 10.  
150 United Stat es' second written submission, para. 33; United States' response to Panel question No. 4.  
151 United States' second written submission, paras. 39 -45; United States' response to Panel question 
No. 4.  
152 United States' responses to Panel question Nos. 5 and 11.  
153 United States' response to Panel question No. 11.  
154 Panel Report, US – Section 301 Trade Act , para. 7.14.  
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  was anno unced in the 2016 No. 1 Document setting forth the priorities for China's agricultural policy 
in 2016. According to this document, the reform of support for corn farmers would follow:  
[T]he principle of letting the market determine prices and delinking subsidies from 
prices, reform in an active yet prudent way the system of corn purchase and storage; 
while allowing corn prices to reflect the relationship between market supply and 
demand, comprehensively take into account factors including adequate income s for 
farmers, fiscal carrying capacity, and the coordinated development of the industry 
supply chain, and establish a corn producer subsidy system.155 
7.66.   A press release dated 28 March 2016 further reports that the corn procurement and reserve 
system would be reformed in that the "price [would be] formed by the market and decoupling of 
price and subsidy."156 China's Ministry of Finance Opinions on Establishing the Subsidy System for 
Corn Producers,  a document  which was adopted "following  the requirements"  of the 2016 No. 1 
Document, also refers to the reform of the corn purchase and reserve system, according to which it 
is for "the market to form the corn price."157  
7.67.   We further note that a 2016 notice on implementing the corn policy in the Heilongjiang 
province stat es expressly that the "temporary purchase and reserve system has been removed, and 
the new mechanism of 'market -oriented purchase' plus 'direct subsidy' is established".158 The 
departure from  corn procurement based on AAP is also reflected in a document from the Chinese 
Ministry of Finance, dated 20 May 2016.159 
7.68.   The United States Department of Agriculture (USDA)  GAIN Reports also provide evidence of  
a fundamental  change  in China's policy  of supporting corn producers . The doc uments , which do not 
necessarily reflect the position of the United States Government,  state that in 2016, China's 
"government announced an end to the floor price for corn"160 and that "China removed price support 
for corn producers".161 They also summari ze the new forms of support measures , which replaced 
the market price support for corn.162 While it is true that one of the GAIN reports, dated April 2016, 
expressed some uncertainty about how the reform would unfold163, none of the documents question 
China's effor ts to move away from AAP -based purchases of corn . In particular, and contrary to the 
United States' assertion , the April 2017 GAIN Report does not  seem to suggest a  "significant 
uncertainty regarding China's continued provision of corn support prices".164 The document refers to 
interventions by local, provincial , and central government s to compensate for, among others, 
"support prices ".165 We do not read this language as implying that purchases at minimum prices 
continue d. To the contrary, the document seem s to be referring to  the difficulties in the agricultural 
                                                
155 Communist Party of China Central Committee and State Council Several Opinions on Strengthening 
Reform and Innovation and Accelerating Agricultura l Modernization (Communist Party of China Central 
Committee, State Council, Zhong Fa [2015] No. 1, issued February 1, 2015) , (Exhibit USA-91), p. 15.  
156 The State Council, News Report "Corn Temporary Purchase and Reserve System will be Shifted to a 
'Market -oriented Purchase' and 'Direct Subsidies'", available at: http://www.gov.cn/xinwen/2016 -
03/28/content_5059171.htm (last viewed 26 October 2017) (English translation), (Exhibit CHN -74B), p. 1.  
157 Ministry of Finance Opinions on Establishing the Subsidy Syste m for Corn Producers (Cai Jian [2016] 
No. 278), 20 May 2016 (English translation), (Exhibit CHN -73B), p. 3.  
158 2016 Heilongjiang Corn Purchase and Sale Work Notice, (Exhibit CHN -86B), p. 1.  
159 The document refers to the same "Price formed by market and decoupling of price and subsidy" and 
states that "it is required to actively and steadily pursue the corn purchase and reserve system reform, and let 
the market to form the corn price." Notice on Issuing the Implementation Plan for the Establishment of Sub sidy 
System for Corn Producers in Liaoning Province (Liao Cai Liu [2016] No.476), 1 August 2016 (English 
translation), (Exhibit CHN -79), p. 3.  The Panel does not understand the term "decoupling" used in the 
document to connote the concept of decoupling wit hin the meaning of Annex 2 of the Agreement on 
Agriculture . 
160 USDA, Foreign Agricultural Service, "China's Decision to End Corn Floor Price Shakes Grain and Feed 
Market", China Grain and Feed Update, GAIN Report Number: CH16027, 8 April 2016, (Exhibit CHN -83), p. 1.  
161 April 2017 USDA GAIN Report, (Exhibit CHN -84), p. 1.  
162 United States Department of Agriculture, Foreign Agricultural Service, "Everything Must Go, State 
Corn Reserves Begin Liquidation", China Grain and Feed Update GAIN Report Number: CH16058,  12 November 
2016, (Exhibit CHN -75), pp. 4 -5. 
163 See United States' response to Panel question No. 60 (second substantive meeting).  
164 See United States' response to Panel question No. 60 (second substantive meeting).  
165 April 2017 USDA GAIN Report, (Exhibit CHN-84), p. 2.  
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  sector resulting from the elimination of the market price support for corn.166 We conclude on this 
basis that the GAIN Reports corroborate the evidence submitted by China.  
7.69.   This is not to say that state-owned and private entities ceased to buy corn under the guidance 
of Chinese authorities .167 In fact, the data available to the Panel shows that corn purchases reached  
significant levels  in 2016 and 2017 .168 Fundamentally, however , the evidence reviewed b y the Panel 
indicates that such purchases were  not made  at an AAP .169 The 2016 Notice on Proper Handling of 
Corn Purchase Work in Northeast China This Year, which sets forth the objectives and modalities of 
the new corn policy , refers to the market nature of  corn purchases .170 This document encourages 
both state and private actors to engage in corn purchases  at the prevailing  prices.171  
7.70.   It is true that many of the above -referenced documents do not expressly mention the 
"termination" of China's provision of marke t price support to corn producers.172 However, the 
covered agreements do not contain a requirement that measures be expressly terminated for them 
to be deemed to have expire d. We note in this regard that prior adjudicators emphasi zed the 
importance of making  such a determination by looking at "the content and substance of the 
instrument" to consider whether it constitutes a measure "and not merely […] its form or 
nomenclature."173 In our view, s imilar logic applies to claims concerning expiry of a measure – 
instead of assessing whether the underlying legal instruments were formally terminated, a panel has 
to examine whether the challenged measure still affects the operation of the covered agreements. 
In any event, the content of the official documents put on the record by the parties reflect s efforts 
of the Chinese authorities to modify the corn purchase policy, so as to abolish the AAP.  
7.71.   Regarding the structure and content of the documents relating to the new corn measure, we 
note that they resemble, in  some aspects, the annual TPRP Notices issued in years 2012 -2015, i.e. 
under the old corn policy. In particular, the 2016 Corn Notice is addressed to a similar set of entities, 
including the local authorities of the major corn producing provinces, the Agricultural Development 
Bank of China (ADBC) and its local branches, Sinograin , COFCO, Chinatex and Aviation Industry 
Corporation of China.174 Similarly to the TPRP Notices, the document requires the relevant entities 
to secure appropriate financing and storage  space for corn purchases.175 Fundamentally, however, 
unlike the TPRP Notices, the 2016 Corn Notice refers to the reform of China's corn purchase and 
reserve system, based on "market -oriented purchase" and the fact that "the price of corn will be 
                                                
166 The document states, among others, that "In 2016, China removed price support for corn producers" 
and that "China's corn producers struggle to respond to the elimination of the temporary reserve program." 
April 2017 USDA GAIN Report, (Exhi bit CHN -84), pp. 1 and 19.  
167 The 2016 Corn Notice requires the relevant regions "to take effective measures and coordinate and 
organize the branches of central and major local grain enterprises within the areas to actively purchase the 
corn, encourage and guide the multiple market players to enter the market". The Panel understands that 
among the main enterprises that should "carry out the market -oriented purchase" were Sinograin, COFCO and 
Aviation Industry Corporation of China.  2016 Corn Notice, (Exhibit USA-87/CHN -80B), pp. 1 -2. 
168 For instance, in the Jilin province 31.4 billion jin of corn had been purchased up until spring 2017. 
2017 Jilin Corn Notice, (Exhibit USA -102), p.1.  
169 The Notice of Further Proper Handling of Corn Purchase and Sales Work refers  to such purchases 
being made at market prices, which had been decreasing immediately prior to the release of the document. 
2017 Jilin Corn Notice, (Exhibit USA -102), p.1.  
170 2016 Corn Notice, (Exhibit USA -87/CHN -80B). The Panel is not assessing the extent to which market 
mechanisms determine corn prices prevailing in China, but rather notes that Chinese authorities did not set an 
AAP for corn.  
171 In the relevant part, the document reads that "Associated central enterprises […] shall make full use 
of their own advantages and channels to carry out the market -oriented purchase, work harder to ensure the 
purchase volume no less than that of the policy -based purchase last year and play a leading role." 2016 Corn 
Notice, (Exhibit  USA-87/CHN -80B), p. 2.  
172 We recal l, however, that the 2016 notice on implementing the corn policy in the Heilongjiang 
province states expressly that the "temporary purchase and reserve system has been removed". 2016 
Heilongjiang Corn Purchase and Sale Work Notice, (Exhibit CHN -86B), p. 1.  
173 Panel Report, EC – IT Products , para. 7.1167; and Appellate Body Report, US – Corrosion -Resistant 
Steel Sunset Review , fn 87.  
174 2016 Corn Notice, (Exhibit USA -87/CHN -80B), p. 1; 2012 TPRP Notice, (Exhibit USA -52/CHN -69B), 
p. 1; 2013 TPRP Notice, (Exhibi t USA -53/CHN -70B), p. 1; 2014 TPRP Notice, (Exhibit USA -54/CHN -71B), p. 1; 
and 2015 TPRP Notice, (Exhibit  USA-55/CHN -72B), p.1.  
175 2016 Corn Notice, (Exhibit USA -87/CHN -80B), pp. 2 -3; 2012 TPRP Notice, (Exhibit USA -52/CHN -
69B), pp. 2 -3; 2013 TPRP Notice, (E xhibit USA -53/CHN -70B), pp. 2 -5; 2014 TPRP Notice, (Exhibit USA -
54/CHN -71B), pp. 4 -6; 2015 TPRP Notice, (Exhibit  USA-55/CHN -72B), pp. 2 -7. 
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  formed by t he market and reflects the supply and demand relation in the market".176 In a similar 
vein, other official documents state that "the corn price will be formed by the market" or that "corn 
prices are based on the market".177 The relevant documents do not mentio n thus any price imposed 
by the central or local governments. This is in stark contrast to the content of the legal instruments 
implementing China's policy of supporting corn price during the years 2012 -2015, which invoke 
"stabilizing market prices" and se t forth in detail the AAP.178 
7.72.   In that connection, the United States argues that China does not publish the AAP and, as a 
result of this lack of transparency, the United States is not in a position to identify it.179 At the same 
time, the United States submits two documents, one issued by Sinograin and the other one by 
Chinatex, which, in the United States' view, reveal the AAP and, read together with other evidence180, 
constitute proof of China's continuing provision of market price support to corn farmers.181 
7.73.   Looking at the content of these documents, we note that the Notice on Activating 2016 
Autumn Grains Corn Purchase Work directs all affiliated depots of the Inner Mongolia branch of 
Sinograin to purchase corn offered for sale by farmers. The document states tha t "in order to better 
serve grain -selling farmers and to safeguard the smooth execution of 2016 autumn grains corn 
purchase work" the depots will advertise and "activate autumn grains corn purchases".182 The 
document further lists different purchase prices, ranging from 0.65 to 0.71 yuan per jin, depending 
on the region.183 Similar information can be found in an analogous notice issued by the Heilongjiang 
branch of Chinatex.184 
7.74.   We note that the prices listed in the two documents submitted by the United States broadly 
correspond to the level of prices issued by other players on the corn market  in China , such as Cargill, 
Jilin Boda Biochemical and Liaoning Yihai Kerry Starch Factory.185 They also seem to be in line with  
or slightly lower than the average prices prevai ling during the relevant time -period and  in the 
relevant  provinces, submitted  by China in response to a question from the Panel.186 Because the 
prices mentioned in the two documents do not differ significantly from the prices used by other 
market players and  the average prices prevailing in the relevant Chinese provinces, these 
documents, read in the light of other record evidence, do not allow a conclusion that the figures 
listed therein constitute government -administered prices.  
7.75.   As regards the average corn prices provided by China, t he United States contests their 
reliability, arguing that China's exhibits do not identify the sources of the data nor which entities 
provided the data, and that the documents contained very limited amounts of information, were  not 
available online or to the public and did not contain any official seal, letterhead or other marking 
reflecting their status or nature.187 The United States also explain s that it was unable to provide 
such information due to China's lack of transparency.188 Yet, we note that certain publicly available 
                                                
176 2016 Corn Notice, (Exhibit USA -87/CHN -80B), p. 1.  
177 2016 Heilongjiang Corn Purchase and Sale Work Notice, (Exhibit CHN-86B), p. 1; National 
Development and Reform Commission, News Release, "The Reform of the Corn Purchase and Reserve System 
Achieved Remarkable Effect", 23 June 2016 (English translation), (Exhibit CHN -87), p. 1.  
178 "In order to conscientiously protect th e interest of farmers, stabilize market prices and promote 
stable development of grain production, the State will implement national temporary reserve purchase of 
corn". 2012 TPRP Notice, (Exhibit USA -52/CHN -69B), p. 1. See also 2013 TPRP Notice, (Exhibit USA-53/CHN -
70B), p. 1; 2014 TPRP Notice, (Exhibit USA -54/CHN -71B), p. 1; and 2015 TPRP Notice, (Exhibit  USA-55/CHN -
72B), p.1.  
179 United States' responses to Panel questions Nos. 2 and 3.  
180 United States' response to Panel question No. 52 (second substantive  meeting).  
181 United States' opening statement at the second meeting of the Panel, paras. 59 -62; United States' 
response to Panel question No. 52 (second substantive meeting); United States' comments on China's 
response to Panel question No. 52 (second subs tantive meeting).  
182 2016 Sinograin Corn Price Announcement, (Exhibit USA -101/CHN -107B), p. 1.  
183 2016 Sinograin Corn Price Announcement, (Exhibit USA -101 CHN -107B), p. 1.  
184 2016 Heilongjiang Corn Purchase Notice, (Exhibit USA -104), p. 1.  
185 The prices differ  based on the origin (province and region), quality grade and moisture level. Corn 
Purchase Price of Cargill Biochemical Limited, 12 December 2016, (Exhibit  CHN-128B), p.1; Purchase 
Information of Jilin Boda Biochemical Limited, 13 December 2016 (English t ranslation and original), (Exhibit 
CHN-133), p. 1; Yihai Kerry Starch, "Liaoning Yihai Kerry Starch Factory Will Lower the New Corn Purchase 
Price by 20 yuan/ton at 11 a.m., October 29", 29 October 2017 (English translation), (Exhibit CHN -134), p. 1.  
186 China's response to Panel question No. 53 (second substantive meeting).  
187 United States' comments on China's responses to Panel question Nos. 52 and 53.  
188 United States' response to Panel question No. 53 (second substantive meeting).  
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  documents contain corn spot prices  for the relevant period of time , even if it is not a complete 
average monthly data for particular provinces. For example , the November 2016 GAIN Report by 
the USDA states that  "30-day average spot prices in early December 2016 are at 1,681 RMB per 
ton".189 This document shows not only that foreign actors have access to pricing data in China, but 
also that the prices specified in Exhibit USA -101 generally correspond to corn prices  prevailing in 
the major corn -producing provinces.  
7.76.   Turning to the corn price itself, the record evidence shows a significant price drop coinciding 
with the alleged expiry of the measure relating to corn.190 As demonstrated in Figures 1 and 2, one 
submitted by China and the other by the United States, the average price of corn significantly 
decreased in China in early 2016 and then fluctuated between 65 and 82 yuan per jin, depending 
on the province.  
Figure 1: Corn prices, January 2012 – February 2018  
 
 Source: China's second written submission, Figure 1.  
 
Figure 2: Corn prices, 2012 – 2017  
 
 Source: Corn Prices 2012 -2017, (Exhibit USA -94). 
 
7.77.   In the Panel's view, the significant drop in corn price following the harvest period of the 2015 
corn, as shown in Fig ure 2, would support the view that past that period, central or local 
governments, or other entities affiliated with the government, no longer set the AAP for corn in the 
                                                
189 United States Departmen t of Agriculture, Foreign Agricultural Service, "Everything Must Go, State 
Corn Reserves Begin Liquidation", China Grain and Feed Update GAIN Report Number: CH16058, 12 November 
2016, (Exhibit CHN -75), p. 11. We note that the United States refers to the pr ice information provided in the 
GAIN reports in its second written submission, para. 54.  
190 China's second written submission, paras. 132 -133; China's response to Panel question No. 2; Corn 
Prices 2012 -2017, (Exhibit USA -94), p.1.  
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  major corn -producing Chinese provinces. If such a practice had been maintained, one w ould have 
expected the price of corn not to fall so significantly.  
7.78.   According to the United States, higher domestic corn prices, compared to international prices,  
indicate that "the lack of an applied administered price communicated to private market actors and 
farmers does not mean that the domestic price is market -based, or that the purchases made by 
state-owned enterprises were not done at support prices."191 We recall, however, that this dispute 
is not about the price of corn in China being free from any type of government intervention, or higher 
than international prices.  As the United States notes in its first written submission, this dispute 
focuses on a single  form of domestic support, namely market price support.192 Where a measure 
takes the form of a market price support, the AAP is a constituent element of that measure.193 Many 
factors other than a government setting specific prices  can influence a product price  in a specific 
market , including  customs  tariffs, quantitative restrictions , as well as  other non -tariff measures and 
other factors .194 Therefore, s howing a difference between domestic and international prices is, in 
light of the claims raised by the United States in this case, not enough to conclude that China 
continued to purchase corn at an AAP.  
7.79.   Turning to the United States' argument that China continues to store and auction corn 
purchased as part of the 2012, 2013, 2014 and 2015 TPRP, we fail to see the r elation between these 
activities and the alleged violations of Articles 3.2 and 6.3 of the Agreement on Agriculture.195 The 
United States' claims under these provisions relate to China providing domestic support in the form 
of market  price support to produce rs of corn. In light of Paragraph  8 of Annex 3 to the Agreement 
on Agriculture, this specific form of domestic support consists of purchases of agricultural products 
at an AAP. This provision does not seem to attach any legal relevance  to auctioning and st oring of 
previously purchased corn. Indeed, the last sentence of Paragraph  8 expressly excludes from its  
scope  payments relating to, among others, buying in or storage  of agricultural products . 
7.80.   Therefore, b ased on the totality of evidence before the Panel,  we conclude that the  reform of 
China's corn policy removed an essential element of the challenged corn measure, the AAP. To us, 
this reform thus marks the expiry of  China's domestic support provided to the producers of corn in 
years 2012 through 2015 in the form of market price support. We base our conclusion on the 
documentary evidence, which reflect s China's departure from the market price support policy 
through purchases of corn at an AAP , as well as record  evidence of corn  prices prevailing in China. 
In particular, the balance of the evidence does not support the United States' contention that China 
continued to purchase corn at an AAP  following the expiry of the 2015 TPRP Notice  and the 
announcement of the new corn policy . As a result, we find that the  measure relating to corn expired 
prior to the initiation of the dispute by the United States, including its request for consultations and 
the request for the establishment of a panel.  
7.2.2.2   Whether the Panel should make findings on the otherwise expired corn measure  
7.81.   Having concluded that the measure relating to corn expired, we will now address China's 
assertion that, due to its termination, the measure falls outside the Panel's terms of reference and 
the Panel should not make findings and issue recommendation s with regard to that measure.  
7.82.   Pursuant to Article 7.1 of the DSU, a panel has to examine, in the light of the relevant 
provisions of the covered agreements cited by the parties to the dispute, the matter referred to it 
by the complainant . This matter cons ists of the claims and the specific measures at issue identified 
in a panel request.196 It is the same matter that a panel "should make an objective assessment of" 
pursuant to Article 11 of the DSU. In EU – PET (Pakistan) , the Appellate Body explained that i n the 
exercise of its inherent adjudicative powers , a panel has the authority "to assess objectively whether 
                                                
191 United States' second wr itten submission, para. 54.  
192 United States' first written submission, para. 14.  
193 Annex 3 AoA, para. 8; United States' first written submission, para. 93.  
194 Indeed, the continued efforts by Chinese state  and private actors  to purchase corn, as well as other 
measures that China may have in place, may have resulted in corn prices in China being higher than 
international prices.  Both parties produced documents reflecting these efforts. See paras  7.68, 7.69 and 7.71 
above.  
195 United States' comments on China's challenge to the Panel's terms of reference, para. 38; United 
States' response to Panel question No. 8.  
196 Appellate Body Report, Guatemala – Cement I , para. 72. 
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  the 'matter ' before it, within the meaning of Article 7.1 and Article 11 of the DSU, has been fully 
resolved or still requires to be examined follo wing the expiry of the measure at issue ".197 China  
argues  that this rationale does not apply in the case at hand, because the measure falls outside the 
Panel's jurisdiction as a result of its expiry prior to the request for the establishment of a panel.198 
We disagree. The distinction  between measures that expired prior to the establishment of a panel 
and those that expired after that date  is a factor  relevant for a panel's decision whether to rule on 
an expired measure  or not . It does not, however, determine t he jurisdiction of a panel with regard 
to that measure.199 We find further contextual support for the proposition that measures that expired 
prior to the establishment of a panel are not a priori  excluded from the scope of the term "measures 
at issue" in Art icle 3.3 of the DSU, which refers to "measures taken" and not, for example, to 
measures in force.200  
7.83.   For similar reasons, we also find unconvincing China's reliance on the Appellate Body report 
in EC – Chicken Cuts  as support  for the proposition that panels  are precluded from ruling on 
measures that did not exist at the time when the establishment of a panel was requested.201 In that 
case, the Appellate Body addressed subsequent measures not mentioned in the panel request, which 
amended the original measures.202 In this case however, the measure relating to market price 
support for corn was identified in the United States' panel request.203 Therefore, the due process 
considerations that underpinned the Appellate Body findings in EC – Chicken Cuts  do not arise in the 
case at hand. In addition, China's reading of the report in EC – Chicken Cuts  would be inconsistent 
with the Appellate Body ruling that whether or not a measure is still in force "is not , however,  
dispositive of the preliminary questio n whether a panel can address claims in respect of that 
measure."204 
7.84.   China also submits that the expiry of the measure relating to corn achieves the first objective 
of WTO dispute settlement, i.e. securing a positive resolution to the dispute, and ruling on such 
measure would be but an advisory opinion of the Panel.205 We thus move on to assess whether the 
expiry of the market price support measure relating to corn has fully resolved the dispute between 
the parties with regard to that measure, or whether it sti ll requires examination.  
7.85.   Article 3.7 of the DSU sets as the aim of the dispute settlement mechanism "securing a 
positive resolution to the dispute". The same provision also states that: "[i]n the absence of a 
mutually agreed solution, the first objective o f the dispute settlement mechanism is usually to secure 
the withdrawal of the measures concerned if these are found to be inconsistent with the provisions 
of any of the covered agreements." We note in that regard that neither panels nor the Appellate 
Body should "'make law ' by clarifying existing provisions of the WTO Agreement outside the context 
of resolving a particular dispute. "206 Guided by Article 3.7 of the DSU, prior panels looked at specific 
circumstances of a given case to determine whether it was a ppropriate to address claims relating to 
expired measures.207 These circumstances included, among others, the timing of the expiry of a 
measure208, whether a measure is included in the terms of reference209, the possibility of 
                                                
197 Appellate Body Report, EU – PET (Pakistan) , para. 5.19. 
198 China's comments on United States' response to Panel question No. 70 (second sub stantive 
meeting), fn 167 (citing Appellate Body Report, EU – PET (Pakistan) , para. 5.38).  
199 As noted by the Appellate Body, "the DSU nowhere provides that the jurisdiction of a panel 
terminates or is limited by the expiry of the measure at issue". Appella te Body Report, EC – Bananas III 
(Article 21.5 – Ecuador II)/EC – Bananas III (Article 21.5 – US), para. 270; See also Panel Reports, EC – 
Approval and Marketing of Biotech Products , para. 7.1650; and Chile – Price Band System  para. 7.514, fn 683.  
200 See Appellate Body Report, EU – Fatty Alcohols (Indonesia) , para. 5.182.  
201 China's first written submission, paras. 324 -327; second written submission, paras. 74 -77, citing the 
Appellate Body Report, EC – Chicken Cuts , para. 156.  
202 Appellate Body Report, EC – Chicken Cuts , para. 151; Panel Report, EC – Chicken Cuts , para. 7.25.  
203 See section 7.2.1 above.  
204 Appellate Body Report, US – Upland Cotton , para. 2 72. 
205 China's response to Panel question No. 22.  
206 Appellate Body Report, US – Wool Shirts and Blouses , p. 19.  
207 Panel Report, China – Electronic Payment Services , para. 7.224.  
208 Panel Report, EU – PET (Pakistan) , para. 7.13 and fn 35.  
209 Panel Report s, Turkey – Rice, para. 7.180; US – Wool Shirts and Blouses , para. 6.2; and Indonesia – 
Autos , para. 14.9.  
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  reintroducing a measure210, whether t he effects  of a measure continued to impair the benefits for a 
Member under a covered agreement.211 
7.86.   We should read the dispute settlement system's objective of "securing a positive resolution 
to the dispute" in light of other provisions of the DSU. In that c onnection, we agree with the panel 
in EC – Bananas III ( Article 21.5 – United States)  that a particular solution to a WTO dispute "can 
lead to a positive resolution of a dispute only if the solution provides an overall satisfactory and 
effective settlement  to the dispute in question in the sense of Article 3.4 of the DSU. "212 In addition, 
we note that Article 4.2 of the DSU, governing DSU consultations, refers to measures "affecting the 
operation of any covered agreement". Therefore, in considering whether to  rule on an expired 
measure, we need to examine whether that measure affects the operation of the covered 
agreements, despite its termination.213 
7.87.   Turning to the facts of this case, we note that the measure relating to corn expired prior to 
the United States'  request for the establishment of a panel and the United States' request for 
consultations.214 In the absence of circumstances weighing in favour of making findings, past panels 
declined to address measures that had expired before the complainant requested t he establishment 
of a panel.215  
7.88.   As regards the risk of reintroducing the market price support for corn, the United States 
contends that "there is no impediment to China continuing to maintain a market price support […] 
program for corn".216 However, apart fro m mentioning the general authority to provide market price 
support to grain producers, the United States does not point to any evidence supporting this 
contention. China, on the other hand, refers to official statements underscoring the need to move 
away f rom the TPR P for corn and, by implication, limiting the probability of its reintroduction.217 We 
consider, therefore, that there is no compelling evidence showing that the market price support for 
corn might be reintroduced.218 
7.89.   We now turn to the United States' argument that the Panel should rule on the measure relating 
to corn, due to the retrospective nature of a panel's analysis under Articles 3.2 and 6.3 of the 
Agreement on Agriculture. The United States points out that "a breach of a domestic support  
commitment must include the presentation of evidence comparing the product -specific AMS for a 
basic agricultural product to the total value of production for that agricultural product in a given 
year".219 We agree with the United States that demonstrating a  violation of a domestic support 
commitment requires presenting evidence, which would typically consist of historical data. However, 
one has to draw a distinction between measures and evidence produced in support of a claim of 
inconsistency.  The evidence  reflects the operation of the measures within a given time -period. It 
does not, however, necessarily suggest that the matter remains unsolved despite expiry of a 
measure and the panel needs to rule on that measure. It follows that t he fact that a panel may need 
to look at historical evidence, does not imply, without more, that it must rule on measures that have 
                                                
210 Panel Reports, India – Additional Import Duties , paras. 7.69 -7.70; Argentina – Textiles and Apparel , 
para 6.14; China  – Electronic Payment Services , para. 7.228.  
211 Panel Reports, Indonesia – Autos , para. 14.206, US – Upland Cotton , para. 7.1201.  
212 Panel Report, EC – Bananas III (Article 21.5 – United States) , para. 7.105.  
213 Appellate Body Report, US – Upland Cotton , paras. 261 -262. 
214 As noted in sect ion 7.2.2.1  above, the measure relating to provision of domestic support in form of 
market price support for producers of corn expired following th e last day of application of the 2015 TPRP 
notice, i.e. on 1 May 2016. The United States requested consultations with China on 13 September 2016 and 
filed a request for the establishment of a panel on 5 December 2016.  
215 Panel Reports, US – Gasoline , para. 6.19; Argentina – Textiles and Apparel , paras. 6.4 and 6.13; EC 
– Approval and Marketing of Biotech Products , para. 7.1653; China  – Electronic Payment Services , para. 
7.228; EU – Poultry Meat (China) , para. 7.167.  
216 United States' response to Panel questio n No. 1. The United States argues that the market price 
support for corn was adopted on a temporary or ad hoc  basis and no new regulation could limit that possibility. 
The United States also points out that Article 27 of the 2004 Grain Distribution Regulat ion authorizes the 
implementation of a market price support for corn.  
217 China's comments on the United States' comments on China's challenge to the Panel's terms of 
reference, para. 70; China's response to Panel question No. 1.  
218 We find support for our co nclusion in Argentina – Textiles  and Apparel , where the panel found that 
"in the absence of clear evidence to the contrary" it could not assume that Argentina would reintroduce the 
terminated measure. Panel Report, Argentina – Textiles and Apparel , para. 6.14. 
219 United States' comments on China's challenge to the Panel's terms of reference, para. 24.  
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  expired.220 We note in that regard that the panel  in Korea – Various Measures on Beef , while looking 
at evidence dating from before the establishment o f the panel , ruled on a  measure which had been 
identified as Korea's " current  domestic support for its beef industry in the context of Korea's 
scheduled commitment levels of domestic support".221 
7.90.   In a similar vein, we are not persuaded by the United States' reliance on the panel and 
Appellate Body reports in China – Raw Materials . In that case, the Appellate Body found that the 
expiry of annually renewed legal instruments did not affect the panel's power to make findings and 
recommendations, because they form ed part of a group or a series of measures, comprised of basic 
framework legislation and implementing regulations.222 Similarly, China's policy of providing market 
price support to producers of corn was also reflected in the general legal framework, includin g the 
2004 Grain Distribution Regulation, the 2004 Grain Opinion and No. 1 Documents and the TPRP 
Notices , taken together .223 However, unlike in China – Raw Materials , it is not the expiry of the 2015 
TPRP Notice alone, but rather the policy of providing mar ket price support for producers of corn, 
implemented through TPRP Notices, that marks the expiry of the corn measure.224 
7.91.   Finally, as noted above, the price of corn fell sharply in China following the decision to 
discontinue the market price support for corn,  and have fluctuated ever since.225 To us, this is an 
indication that upon its expiry, the measure relating to corn ceased to produce effects on the market 
that could impact the operation of the provisions of the Agreement on Agriculture invoked by the 
United States. This is not to say that  China does not have in place other measures that could affect 
the operation of the same provisions of the Agreement on Agriculture. We recall, however, that 
these measures have not been challenged by the United States in this dispute and the Panel has no 
mandate to address them. This applies, in particular, to the new corn policy, which has a different 
essence compared to the corn measure challenged by the United States. In sum, we do not see how 
the measure relating to corn, despite its expiry, could cont inue to affect the operation of Articles 3.2 
and 6.3 of the Agreement on Agriculture, as argued by the United States.  
7.92.   In light of the above, and given the Panel's jurisdiction over the corn measure, we consider 
that the essential element of that measure – the AAP – has been removed, as the government no 
longer sets the purchase price in this way. The challenged corn measure has thus expired. Having 
analysed considerations that could potentially weigh in favour of making findings with regard to the 
                                                
220 The Appellate Body has recognized a distinction between measures and evidence presented to 
substantiate of a claim in the context of temporal limitations. S ee Appellate Body Reports, EC – Selected 
Customs Matters , para. 188; and US – Large Civil Aircraft (2nd Complaint) , paras. 7.685 -7.686.  
221 Panel Report, Korea – Various Measures on Beef , paras. 800, 845 (i) and (j). (emphasis added)  
222 Appellate Body Report,  China – Raw Materials , para. 264.  
223 See paras. 7.94-7.95 below.  The Panel notes that the 2004 Grain Opinion and the 2004 Grain 
Distribution Regulat ion instruct the relevant Chinese authorities to "implement minimum purchase prices in the 
main grain producing regions", while Article 2 of the 2004 Grain Distribution Regulation defines grain as, 
among others, "wheat, rice, corn". See 2004 Grain Opinion , (Exhibit USA -10/CHN -10B), p. 2;  Articles  2, 24 
and 26 -27, 2004 Grain Distribution Regulation, (Exhibit USA -12/CHN -9B), p p. 1 and 5. As regards the 2012 -
2015 No. 1 Documents, the Panel notes that they contained, among its numerous objectives "initiat[ing]  
temporary purchasing and storage for [products including] corn ". See Communist Party of China Central 
Committee and State Council Several Opinions on Accelerating the Promotion of Agricultural Science and 
Technology Innovation and Continuing to Strengthen the Capacity to Guarantee Agricultural Product Supplies 
(Communist Party of China Central Committee, State Council, Zhong Fa [2012] No. 1, issued December 31, 
2011), (Exhibit USA -13), p. 14; Communist Party of China Central Committee and State Council Seve ral 
Opinions on Accelerating Development of Modern Agriculture and Further Increasing Rural Development 
Dynamism (Communist Party of China Central Committee, State Council, Zhong Fa [2013] No. 1, issued 
December 31, 2012), ( Exhibit USA -14), p. 4; Communist  Party of China Central Committee and State Council 
Publication of "Several Opinions on Comprehensively Deepening Rural Reform and Accelerating the Promotion 
of Agricultural Modernization" (Communist Party of China Central Committee, State Council, Zhong F a [2014] 
No. 1, issued January 19, 2014),  (Exhibit USA -15), p. 3; Communist Party of China Central Committee and 
State Council Several Opinions on Strengthening Reform and Innovation and Accelerating Agricultural 
Modernization (Communist Party of China Cen tral Committee, State Council, Zhong Fa [2015] No. 1, issued 
February 1, 2015), ( Exhibit USA -16), p. 7.  
224 In a response to a question from the Panel, the United States noted that while support to agricultural 
producers, such as market price support, is typ ically provided on a yearly basis, "it would be accurate to 
characterize the measures challenged by the United States as continuing policies applied through annual legal 
instruments." United States' response to Panel question No. 71 (second substantive mee ting).  
225 See para. 7.76 above.  
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  expired c orn measure, we did not find that any of them require the Panel to rule on that measure. 
We therefore decline to do so.  
7.2.3   Main characteristics of the wheat and rice measures  
7.93.   Having discerned the relevant measures identified in the United States' panel reque st, we will 
briefly summari ze their main characteristics and  how they operate . In light of our decision not to 
rule on the corn measure , we will only  address  the wheat and rice measures . 
7.2.3.1   General framework  
7.94.   The overarching instruments establishing China's ma rket price support policy for various types 
of grain are the 2004 Grain Opinion and the 2004 Grain Distribution Regulation.226 Both documents 
invoke the objectives of liberalizing and reforming the grain market in China.227 They also empower 
the State Council,  China's highest executive body, to implement the minimum procurement price 
policy "in the main grain producing regions for the key grain varieties that are in short supply" .228  
7.95.   The objective of raising the minimum procurement price for wheat and rice is al so expressed 
in several Opinions of the Central Committee of the Chinese Communist Party and the State Council 
(so-called "No. 1 Document s").229 These documents indicate that while China may have been 
envisaging transitioning its agricultural policies with r espect to wheat  and rice to more market -based 
mechanisms, the highest Chinese authorities endorsed maintaining a minimum procurement price 
for these products during the years 2012 -2015. While the No. 1 Documents cover a wide array of 
agricultural policy is sues, the evidence shows that Chinese authorities were "following the 
requirements of the No. 1 Central Document"230 and sought to "effectively implement" such 
documents when adopting more specific legal instruments.231 Within this general framework, various 
bodies adopted  more specific annual instruments establishing minimum procurement price 
requirements , as discussed below . 
7.2.3.2   Market price support programmes for wheat and rice  
7.96.   Pursuant to the 2004 Grain Opinion and the 2004 Grain Distribution Regulation, China' s 
National Development and Reform Commission (NDRC), the Ministry of Finance, the Ministry of 
Agriculture and the State Administration of Grain (SAG) adopt jointly Annual Notices setting forth or 
increasing the minimum procurement price for wheat and rice in a given year.232 While the 2004 
Grain Distribution Regulation appears to limit the State Council's discretion in implementing the 
minimum procurement price policy to cases when such actions are "necessary",233 the Chinese 
                                                
226 2004 Grain Opinion, (Exhibit USA -10/CHN -10B); 2004 Grain Distribution Regulation, (Exhibit USA -
12/CHN -9B). 
227 2004 Grain Opinion, (Exhibit USA -10/CHN -10B), p. 2; Article 4, 2004 Grain  Distribution Regulation, 
(Exhibit USA -12/CHN -9B), p. 1.  
228 2004 Grain Opinion, (Exhibit USA -10/CHN -10B), para. 5. See also Articles 24 and 26 -27, 2004 Grain 
Distribution Regulation, (Exhibit USA -12/CHN -9B), p. 5.  
229 Communist Party of China Central Committee and State Council Several Opinions on Accelerating the 
Promotion of Agricultural Science and Technology Innovation and Continuing to Strengthen the Capacity to 
Guarantee Agricultural Product Supplies (Communist Party of China Central Committee, S tate Council, Zhong 
Fa [2012] No. 1, issued December 31, 2011), (Exhibit USA -13), p. 14; Communist Party of China Central 
Committee and State Council Several Opinions on Accelerating Development of Modern Agriculture and Further 
Increasing Rural Developmen t Dynamism (Communist Party of China Central Committee, State Council, Zhong 
Fa [2013] No. 1, issued December 31, 2012), ( Exhibit USA -14), p. 4; Communist Party of China Central 
Committee and State Council Publication of "Several Opinions on Comprehensivel y Deepening Rural Reform 
and Accelerating the Promotion of Agricultural Modernization" (Communist Party of China Central Committee, 
State Council, Zhong Fa [2014] No. 1, issued January 19, 2014),  (Exhibit USA -15), p. 3; Communist Party of 
China Central Com mittee and State Council Several Opinions on Strengthening Reform and Innovation and 
Accelerating Agricultural Modernization (Communist Party of China Central Committee, State Council, Zhong Fa 
[2015] No. 1, issued February 1, 2015), ( Exhibit USA -16), p. 7 . 
230 Ministry of Finance Opinions on Establishing the Subsidy System for Corn Producers (Cai Jian [2016] 
No. 278), 20 May 2016 (English translation) (hereinafter "MOF Opinions, May 2016 "), (Exhibit CHN -73B), p. 1.  
231 2016 Corn Notice, ( Exhibit USA -87/CHN -80B), p. 1.  
232 China's first written submission, para. 66.  
233 Article 27, 2004 Grain Distribution Regulation, (Exhibit USA -12/CHN -9B), p. 5.  
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  authorities issued the Annual Notic es on a yearly basis  between 2012 and 2015 .234 This suggests a 
degree of continuity in China's policy of providing market price support to producers of wheat and 
rice. The references in Annual Notices to prices announced in previous years could also suggest a 
degree of continuity in the operation of t he measures.235 
7.97.   The Annual Notices set the minimum procurement price applicable to a particular grain type 
in a given year in the "major producing regions". The minimum procurement price is defined in 
China's legal instruments as "the price offered at the pu rchasing and storage depots responsible for 
purchasing grain directly from farmers according to the minimum procurement price policy."236 Table 
2 in section 7.4.5.1  below lists the minimum procurement prices for each of the relevant product s 
in years 2012 -2015.  
7.98.   The minimum procurement prices are typically announced in advance of the harvesting year 
and prior to the planting season. For wheat, this is typically October  of the year preceding the 
harvest; for rice, it is January or February of the harvest year.237 The competent authorities are 
required to publici ze information about the minimum procurement price, to "raise the farmers' 
enthusiasm for production"238 and "guide  the farmers to plan their sowing reasonably in order to 
propel stable development of grain production" .239 This or similar language is repeated across notices 
for different years and types of grain. We thus understand that each of the measures relating to 
wheat, Indica rice and Japonica rice endeavours to make the minimum purchase price known to 
farmers prior to the planting season.  
7.99.   Further details of the measures relating to wheat, Indica rice and Japonica rice – such as the 
exact periods of operation, the competent entities and modalities of the administrative purchase of 
agricultural products – are set forth in the Implementation Plans.240 The Implementation Plans are 
adopted annually around the time of the harvesting season by the same entities that adopt t he 
Annual Notices.241 The Implementation Plans relating to wheat, Indica rice and Japonica rice follow 
                                                
234 2012 Wheat Annual Notice, (Exhibit USA -20/CHN -18B); 2012 Rice Annual Notice, (Exhibit USA -
39/CHN -23B); 2013 Rice Annua l Notice (USA -40/CHN -24B); 2013 Wheat Annual Notice (Exhibit USA -21/CHN -
93B); 2014 Wheat Annual Notice, (Exhibit USA -22/CHN -20B); 2014 Rice Annual Notice, (Exhibit USA -41/CHN -
25B); 2015 Wheat Annual Notice (Exhibit USA -23/CHN -21B); 2015 Rice Annual Notice (Exhibit USA -42/CHN -
26B).  
235 While some notices refer in the title to "announcing" the minimum price for a certain year, others 
mention "raising". See 2012 Wheat Annual Notice (Exhibit USA -20/CHN -18B), p.1; 2014 Wheat Annual Notice, 
(Exhibit USA -22/CHN -20B), p. 1; 2012 Rice Annual Notice (Exhibit USA -39/CHN -23B), p.1; 2013 Rice Annual 
Notice, (Exhibit USA -40/CHN -24B), p.  1; 2014 Rice Annual Notice, (Exhibit USA -41/CHN -25B), p.1.  
236 Article 3, 2012 Early -Season Indica Rice Implementation Plan, (Exhibit USA -44/CHN-34B Revised), p. 
2; Article 3, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised), p. 2; Article 3, 2013 Wheat 
Implementation Plan, (Exhibit USA -25/CHN -19B Revised), p. 2; Article 3, 2014 Mid - to Late -Season Rice 
Implementation Plan, (Exh ibit USA -48/CHN -31B Revised), p. 3; Article 4, 2015 Wheat and Rice 
Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 3; Article 3, 2014 Wheat and Early -Season Indica 
Rice Implementation Plan, (Exhibit  USA-26/CHN -30B Revised); pp. 3 and 11.  
237 2014 Wheat Annual Notice, (Exhibit USA -22/CHN -20B); 2015 Wheat Annual Notice, (Exhibit USA -
23/CHN -21B); 2012 Rice Annual Notice, (Exhibit USA -39/CHN -23B); 2013 Rice Annual Notice, (Exhibit USA -
40/CHN -24B); 2014 Rice Annual Notice, (Exhibit  USA-41/CHN -25B);  2015 Rice Annual Notice, (Exhibit USA -
42/CHN -26B).  
238 2012 Wheat Annual Notice, (Exhibit USA -20/CHN -18B), p. 1; 2014 Wheat Annual Notice, (Exhibit 
USA-22/CHN -20B), p. 1; 2012 Rice Annual Notice, (Exhibit USA -39/CHN -23B), p. 1; 2013 Rice Annual Notice, 
(Exhibit USA -40/CHN -24B), p. 1; 2014 Rice Annual Notice, (Exhibit  USA-41/CHN -25B), p. 1.  
239 2015 Rice Annual Notice, (Exhibit USA -42/CHN -26B), p. 1; 2015 Wheat Annual Notice, (Exhibit USA -
23/CHN -21B), p. 1.  
240 2012 Wheat Implementation Plan (Exhibit USA -24/CHN -29B Revised); 2012 Early-Season Indica Rice 
Implementation Plan, (Exhibit USA -44/CHN -34B Revised); 2012 Mid - to Late -Season Rice Implementation 
Plan, (Exhibit USA -45/CHN -36B Revised); 2013 Wheat Implementation Plan, (Exhibit USA -25/CHN -19B 
Revised); 2013 Ea rly-Season Indica Rice Implementation Plan, (Exhibit USA -46/CHN -35B Revised); 2013 Mid - 
to Late -Season Rice Implementation Plan, (Exhibit USA -47/CHN -37B Revised); 2014 Wheat and Early -Season 
Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised) ; 2014 Mid - to Late -Season Rice 
Implementation Plan, (Exhibit USA -48/CHN -31B Revised); 2015 Wheat and Rice Implementation Plan, (Exhibit 
USA-27/CHN -28B Revised).  
241 See 2012 Wheat Implementation Plan (Exhibit USA -24/CHN -29B Revised), p. 1; 2012 Early-Season  
Indica Rice Implementation Plan, (Exhibit USA -45/CHN -36B Revised), p. 1; 2012 Mid - to Late -Season Rice 
Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 1; 2013 Wheat Implementation Plan, (Exhibit 
USA-25/CHN -19B Revised), p. 1; 2013 Early -Season I ndica Rice Implementation Plan, (Exhibit USA -46/CHN -
35B Revised), p. 1; 2013 Mid - to Late -Season Rice Implementation Plan, (Exhibit USA -47/CHN -37B Revised), 
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  a similar structure and use a similar language, allowing analogous conclusions about the operation 
of the wheat and rice measures. Therefore, we consider b elow jointly various aspects of the 
measures relating to these two products.  
7.2.3.3   Entities involved  
7.100.   The Implementation Plans are addressed to the regional branches and departments of 
Sinograin  and the ADBC, which, in turn, designate the appropriate local depots  responsible for 
purchase and storage of grain.242 Such depots must have sufficient capacity to accommodate "the 
expected amount of grain purchased at the minimum procurement price."243 In addition, local 
authorities are instructed to "guide and encourage vari ous grain operation, and processing 
enterprises to actively enter the market and purchase new grains."244 We, therefore, understand 
that the entities implementing the minimum procurement price policy are either part of the state 
administration or act under g uidance and direction of the state administration , which was not 
disputed by the parties . 
7.101.   The purchase of wheat, Indica rice and Japonica rice is financed through loans issued to the 
entities responsible for grain purchase "in full amount … pursuant to the  minimum purchase price".245 
The legal instruments cited by China and the United States do not refer to any limitations on the 
amount of funds available to finance the purchase of grain. In fact, China confirmed during the first 
substantive meeting with the Panel that there are no limitations on the amounts of loans that the 
ADBC can issue to finance the purchase of wheat, Indica rice and Japonica rice under the market 
price support programmes.246 Likewise, the Implementation Plans do not explicitly mention any  
limits on the amount of grain that the designated entities should  purchase, if the market price falls 
below the minimum level. Indeed, the Implementation Plans require storage capacity to "match with 
the expected amount of grain purchased at the minimum p rice."247 They further instruct Sinograin 
                                                
p. 1; 2014 Wheat and Early -Season Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised) , p. 1; 
2014 Mid - to Late -Season Rice Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p. 1; 2015 Wheat 
and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 1.  
242 Article 5, 2015 Wheat and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 3; 
Article 5, 2012 Wheat Implementation Plan (Exhibit USA -24/CHN -29B Revised), p. 3; Article 5, 2013 Wheat 
Implementation Plan, (Exhibit USA -25/CHN -19B Revised), p. 3; Article 5, 2014 Mid - to Late -Season Rice 
Implementation Plan, (Exhibit US A-48/CHN -31B Revised), p. 4; Article 5, 2014 Wheat and Early -Season Indica 
Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), p. 4; Article 5, 2012 Early -Season Indica Rice 
Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 3.  
243 Article 5,  2014 Wheat and Early -Season Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B 
Revised), p. 4; Article 5, 2012 Early -Season Indica Rice Implementation Plan, (Exhibit USA -44/CHN -34B 
Revised), p. 3; Article 5, 2012 Wheat Implementation Plan (Exhibit USA-24/CHN -29B Revised), p. 3; Article  5, 
2013 Wheat Implementation Plan, (Exhibit USA -25/CHN -19B Revised), p. 3; Article 5, 2014 Mid - to Late -
Season Rice Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p. 4; Article 5, 2015 Wheat and Rice 
Implement ation Plan, (Exhibit USA -27/CHN -28B Revised), p. 4; Article 5, 2014 Wheat and Early -Season Indica 
Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), pp. 4 and 12.  
244 Article 9, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised), p. 5.  See also 
Article 9, 2015 Wheat and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 6; Article 9, 2013 
Wheat Implementation Plan, (Exhibit USA -25/CHN -19B Revised), p.5; Article 9, 2012 Early -Season Indica Rice 
Implementation Plan, (Exhibit U SA-44/CHN -34B Revised), p. 5; Article 9, 2014 Wheat and Early -Season Indica 
Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), p.  6; Article 9, 2014 Mid - to Late -Season Rice 
Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p. 6.  
245 Article 11 , 2012 Early -Season Indica Rice Implementation Plan, (Exhibit USA -44/CHN -34B Revised), 
p. 6; See also Article 10, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised), p. 6; Article 
10, 2013 Wheat Implementation Plan, (Exhibit USA -25/CHN -19B Re vised), p. 6; Article 10, 2014 Mid - to Late -
Season Rice Implementation Plan, (Exhibit USA -48/CHN -31B Revised); Article 10, 2015 Wheat and Rice 
Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 7; Article 10, 2014 Wheat and Early -Season 
Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), pp. 6 -7. 
246 See also China's response to Panel question No. 43.  
247 Article 5, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised), p. 3; Article 5, 2015 
Wheat and Rice Implementation Plan, ( Exhibit USA -27/CHN -28B Revised), p. 4; Article 5, 2013 Wheat 
Implementation Plan, (Exhibit USA -25/CHN -19B Revised), p. 3; Article 5, 2014 Mid - to Late -Season Rice 
Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p. 4; Article 5, 2012 Early -Season Ind ica Rice 
Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 3; Article 5, , 2014 Wheat and Early -Season 
Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), p. 4.  
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  and local authorities to use the available storage space, or procure new space in order to "meet 
farmer's needs for grain selling".248 
7.2.3.4   Geographical scope  
7.102.   The geographical scope of the measures relating to wheat, Indica  rice and Japonica rice is 
essentially confined to "the major producing regions". These regions are further specified in the 
Implementation Plans. In the years 2012 -2015, they included:249 
a. Wheat : Hebei, Jiangsu, Anhui, Shandong, Henan and Hubei.  
b. Early-season  Indica rice : Anhui, Jiangxi, Hubei, Hunan and Guangxi.  
c. Mid- to late -season Indica and Japonica rice : Liaoning, Jilin, Heilongjiang, Jiangsu, Anhui, 
Jiangxi, Henan, Hubei, Hunan, Guangxi, Sichuan.  
7.103.   Local governments in these regions have to implement the mi nimum procurement price 
policy, while governments in other provinces can decide, at their discretion, whether to do so. This 
follows from the imperative language of Article 2 of the Implementation Plan for a given year with 
respect to the major producing r egions, as opposed to the discretionary language used in respect of 
other regions.250  
7.2.3.5   Temporal scope  
7.104.   The Implementation Plans specify time -periods, during which the relevant entities have to 
purchase grains at the specified minimum price, should the market price fall below that level.251 The 
table below outlines the implementation periods for wheat and rice during the years 2012 through 
2015.  
Table 1: Implementation periods of minimum procurement price for wheat and rice  
Year Wheat  Early -season Indica 
rice Mid- and late -season Indica/Japonica 
rice 
2012 21/05/2012 -
30/09/2012  16/07/2012 -
30/09/2012  16/09/2012 -31/12/2012 (8 provinces252); 
16/11/2012 -31/03/2013 (3 provinces253) 
2013 21/05/2013 -
30/09/2013  16/07/2013 -
30/09/2013  18/09/2013 -31/01/2014 (8 provinces);  
16/11/2013 -31/03/2014 (3 provinces)  
2014 21/05/2014 -
30/09/2014  16/07/2014 -
30/09/2014  16/09/2014 -31/01/2015 (8 provinces);  
01/11/2014 -31/03/2015 (3 provinces)  
2015 21/05/2015 -
30/09/2015  16/07/2015 -
30/09/2015  16/09/2015 -31/01/2016 (8 provinces);  
10/10/2015 -29/02/2016 (3 provinces)  
7.105.   Generally, these time -periods immediately follow the annual harvest in the major wheat and 
rice producing provinces.254 During that time, the relevant authorities have to supervise the 
designated grain depots and encourag e other entities' involvement in implementing the minimum 
                                                
248 Article 5, 2015 Wheat and Rice Implementation Plan, (Exhibit USA -27/CH N-28B Revised), p. 5; 
Article 5, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised), p. 3; Article 5, 2014 Wheat 
and Early -Season Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), pp. 5 and 13. See also 
Article 5, 2012 Early -Season Indica Rice Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p.3 
(referring to "actual needs").  
249 See Article 2 of the Implementation Plan for a given year.  
250 Article 2 of the Implementation Plans. We note in that regard that there is no disag reement between 
the parties concerning the provinces covered by the challenged measures. See para. 7.301  below.  
251 Article 6 of the Implementation Plans.  
252 Jiangsu, Anhui, Jiangxi, Henan, Hubei, Hunan, Guangxi, Sichuan Provinces.  
253 Liaoning, Jilin, Heilongjiang Provinces.  
254 United States' first written submission, para. 54.  
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  procurement price policy after the relevant type of grain enters the market .255 As such, the 
implementation periods of the measures seem to coincide with the time period when the supply of 
a particula r type of grain is at its highest (as is the risk of the price falling below the desired minimum 
level).  
7.106.   The purchases of wheat, Indica rice and Japonica rice at minimum prices are "activated" 
when the market price of a particular type of grain drops below  the minimum procurement price and 
"deactivated" once the grain price climbs back above the minimum level.256 The Implementation 
Plans state that during the implementation periods, the relevant entities "shall actively enter the 
market and purchase new grain s for rotation, and the procurement price for grain rotation shall not 
be lower than the national minimum procurement price."257 The measures  thus ensure a price floor 
for each type of grain, as intervention on the grain market depends on whether the market price 
falls below the minimum procurement price . 
7.2.3.6   Quality requirements  
7.107.   China maintains that only grain meeting specific national quality standards is eligible for 
purchase under the measures relating to wheat, Indica rice and Japonica rice.258 These requireme nts 
are specified in the Implementation Plans, which reference "National Standard No. 3 Grade" as the 
standard quality product (with grain quality grades ranging from 1 to 5).259 We understand from 
these documents that grain of a lower or higher quality grad e260 would still be subject to government 
procurement, albeit at slightly different prices.261 China would not procure inferior quality "out -of-
grade" grain at minimum prices set forth in the measures.262 
7.3  Claims brought by the United States and Panel's order of analysis  
7.108.   As stated  in Section 3, the United States requests  the Panel  to find that China has acted 
inconsistently with its obligations pursuant to Articles 3.2 and 6.3 of the Agreement on Agriculture 
because the level of do mestic support provided by China exceeds China's commitment level of "nil" 
specified in Section I of Part IV of China's Schedule CLII. In the alternative, and to the extent China's 
commitment level of "nil" was understood as not setting out any commitment,  the United States 
requests the Panel to find that these measures are inconsistent with C hina's obligation under 
Article  7.2(b) of the Agreement on Agriculture .263 
                                                
255 Article 9, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised) , p. 5; Article 9, 2014 
Mid- to Late -Season Rice Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p. 6; Article 9, 2015 Wheat 
and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 6; Article 9, 2013 Wheat 
Implementation Plan, (Exhibit US A-25/CHN -19B Revised), p.5; Article 9, 2012 Early -Season Indica Rice 
Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 5; Article 9, 2014 Wheat and Early -Season Indica 
Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), pp. 6 and 14.  
256 China's first written submission, paras. 75 and 76.  
257 Article 8 of the Implementation Plans. See for example the 2013 Wheat Implementation Plan, 
(Exhibit USA -25/CHN -19B Revised), p. 5.  
258 China's first written submission, para. 82.  
259 Article 3, 2014 Wheat and Early-Season Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B 
Revised), pp. 3 and 1 2; Article 3, 2012 Early -Season Indica Rice Implementation Plan, (Exhibit USA -44/CHN -
34B Revised), p. 2; Article 3, 2014 Mid - to Late -Season Rice Implementation Plan , (Exhibit USA -48/CHN -31B 
Revised), p.3; Article 3, 2013 Wheat Implementation Plan, (Exhibit USA -25/CHN -19B Revised), p. 2; Article 4, 
2015 Wheat  and Rice  Implementation Plan, (Exhibit USA -27/CHN -28B Revised), pp. 2 -3; Article 3, 2012 Wheat 
Implementation Plan, (Exhibit USA -24/CHN -29B Revised), pp. 2 -3. 
260 2010 National Standards of Grain Quality Notice, (Exhibit CHN -43B Revised), p. 2.  
261 China's response to Panel question No. 26. Article 3, 2014 Wheat and Early -Season Indica Rice 
Implementation Plan, (Exhib it USA -26/CHN -30B Revised), pp. 3 and 11; Article 3, 2012 Early -Season Indica 
Rice Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 2; Article 3, 2014 Mid - to Late -Season Rice 
Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p.3; Article 3, 2013 Wheat Implementation Plan, 
(Exhibit USA -25/CHN -19B Revised), p. 2; Article 4, 2015 Wheat  and Rice  Implementation Plan, (Exhibit USA -
27/CHN -28B Revised), p. 3; Article 3, 2012 Wheat Implementation Plan, (Exhibit USA -22/CHN -29B Revised), 
p. 2. 
262 China's  response to Panel question No. 26.  
263 United States' first written submission, para. 137 and fn 251.  
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  7.109.   We will thus begin by assessing the United States' claims under Articles 3.2 and 6.3  of the 
Agreement on Agriculture  and then proceed to the alternative claim under Article 7.2(b) of the 
Agreement on Agriculture , if necessary . 
7.4  Claims under Articles 6.3 and 3.2 of the Agreement on Agriculture  
7.4.1   Introduction  
7.110.   As framed by the United States in its panel request  and subsequent submissions, this dispute 
relates to the assessment of China's compliance with its domestic support commitments in the form 
of "a single means of agricultural support, 'market price support'".264 The United States contends  
that China  has provided market price support to its agricultural producers of wheat and rice265 in 
excess of its commitments under the Agreement on Agriculture.  
7.111.   The United States claims that  the level of domestic support China provided in 2012, 2013, 
2014, and 2015, the most recent years for which, according to the United States, full annual 
production and pricing data is available, is  in excess of China's de minimis  level of 8.5% for each of 
the products at issue and thus of its commitment level of " nil". According to  the United States,  China 
is breaching its WTO commitments solely through its market price support program mes for wheat, 
Indica rice, and Japonica rice, when calculated in accordance with the provisions of the Agreement 
on Agriculture.266  
7.112.   In response, China  contends that its 2012-2015 market price support for both wheat and 
rice was below  China 's negotiated de minimis  commitment level of 8.5% of the total value of 
production of th ese basic agricultural products and, a ccordingly, that there is no measurement of 
support to be included in China's Current Total AMS.267 China submits that the calculations of China's 
AMS presented by the United States suffer  from various fundamental errors, in particular, because 
they are based solely on what the United States terms the "methodology " established in Annex 3 of 
the Agreement on Agriculture .268 China argues that the key methodologies at issue in this dispute 
are those found in China 's constituent data and methodology  (CDM)  used in the tables of supporting 
material incorporated by reference in Part IV of China 's Schedule .269  
7.113.   In what follows, we will address the parties' arguments regarding China's compliance with 
its domestic support commitments und er the Agreement on Agriculture  for the products at issue, 
namely, wheat and rice, and in the years brought forward by the United States, namely 2012 to 
2015.270 Our assessment will be organized as follows: We will first discuss China's domestic support 
obligations as set out in the relevan t provisions in the Agreement on Agriculture, and the method of 
calculating the AMS for each product at issue, including the market price support formula. We then 
move to an examination of the issues relating to the definition and calculation of the variab les of the 
market price support formula. This includes an examination of the AAP, the FERP and the QEP, as 
well as a determination of the most appropriate adjustment rate to the processing level for certain 
rice products. We will then perform the calculati ons based on the conclusions arrived at with respect 
to each variable, and compare the results to China's de minimis  level of 8.5%. Finally we address 
the United States' claim under Article 7.2(b) of the Agreement on Agriculture.  
                                                
264 United States' first written submission, para. 1.  
265 We recall that as discussed in Section 7.2.2.2  above, the Panel has decided not to assess the corn 
measures.  
266 United States' first written submission, para. 9.  
267 China's first written submission, para. 89.  
268 China's first written submission, para.  89 (referring to United States' first written submission, 
para. 93). 
269 China's first written submission, para. 89.  
270 We recall that China has requested that the Panel should additionally examine market price support 
for these products for 2016 (even thoug h support in 2016 was not challenged by the United States) alleging 
that this will also be found to be below the 8.5% de minimis  level ( China's first written submission, para. 89). 
For the reasons set out in  paragraph  7.52 above, we will limit our analysis to the years 2012 -2015.  
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  7.4.2    Domestic support obligati ons as set out in Articles 3.2 and 6.3 of the Agreement 
on Agriculture  
7.114.   At the outset, we note that there is no substantial disagreement between the parties on the 
interpretation of Articles 3.2 and 6.3 of the Agreement on Agriculture. As will be seen below , the 
parties seem largely to agree on the nature and scope of China's obligations. The main source of 
disagreement relates to how to  calculate  China's domestic support  provided through the challenged 
measures . 
7.115.   The United States argues that the domestic su pport obligations set forth in Articles 3 and 6 
of the Agreement on Agriculture are specifically tied to commitments made by each Member in Part 
IV of their Schedule of Concessions.271 The United States contends that under Article 3.2 of the 
Agreement on Agriculture, China  shall not provide support in favo ur of domestic  producers  in excess 
of the commitment levels specified in Section I of Part IV of its Schedule and that  to evaluate Ch ina's 
compliance with its domestic support obligations in 2012, 2013, 2014 , and 2015, it is necessary to 
determine whether China's Current Total AMS for each year exceeded "nil ".272 
7.116.   The United States expands on its arguments and submits that pursuant to Arti cles 3 and 6 
of the Agreement on Agriculture , each Member commits to limit its domestic support to the 
"commitment levels specified in Section  I of Par t IV of [the Member's] Schedule"273 and that 
Members individually specify their commitments in the form of "Annual and Final Bound Commitment 
Levels " in Part IV of their Schedules of Concessions on Goods.274 For the United States, it is to this 
commitment that a Member's Current Total AMS is compared for a given year to determine whether 
the Member's level of dom estic support is consistent with its WTO commitments.275 The United 
States also submits that under Articles 1 (h) and 3.2 of the Agreement on Agriculture,  Current Total 
AMS is to be calculated "in accordance with the provisions of Article 6 " and "subject to A rticle 6 ". 
The United States notes that Article 6.4 of the Agreement on Agriculture directs Members to exclude 
de minimis  levels of support from the calculation of Current  Total AMS and that  product -specific  
domestic  support  that is less than or equal to the de minimis  level is excluded from the calculation 
of a Member 's Current Total AMS.276 The United States submits that, c onversely , when a Member 's 
product -specific support for a basic agricultural product exceeds the de mini mis level, then the total 
value of that support must be included in the Member 's Current Total AMS calculation.277  
7.117.   Regarding the de minimis  threshold, the United States maintains that China's  Working Party 
Report states that , in implementing Article 6.4 of the Agreement on Agriculture , China will "have 
recourse to a de minimis  exemption for product -specific support equivalent to 8.5 per cent of the 
total value of production of a basic agricultural product duri ng the relevant year ".278 The United 
States argues that t hus, consistent with its accession commitment, China may provide support up 
to a de minimis  level for each ba sic agricultural product of 8.5% of the respective value of production 
in each year without counting that product -specific support towards it s Current Total AMS.  
7.118.    China submits that Article 3.2 of the Agreement on Agriculture  contains Members ' core 
obligations wi th respect to domestic support and that Article 6 elaborates on these obligations. For 
China, Article 6.3 stipulates that compliance with the obligation in Article 3.2 is to be assessed on 
the basis of an annual comparison between (i) negotiated, Member -specific commitment levels and 
(ii) a calculation of that Member 's annual levels of domestic support in the year at issue, expressed 
"in terms of Current Total [Aggregate Measuremen t of Support or] AMS ".279 China also contends 
                                                
271 United States' first written submission, para. 78.  
272 United States' first written submission, para. 70.  
273 United Stat es' first written submission, para. 80 (referring to Agreement on Agriculture, Article 3.2).  
274 United States' first written submission, para. 80 (referring to Agreement on Agriculture, 
Article  1(h)(i)).  
275 Agreement on Agriculture, Article 6.3.  
276 Pursuant t o Article 6.4, a similar calculation is completed for non -product specific domestic support. 
In the event that non -product specific domestic support is less than or equal to a Member's de minimis  level 
when compared to the total value of agricultural produ ction, is not required to be included in the Current Total 
AMS calculation.  
277 United States' first written submission, para. 82.  
278 United States' first written submission, para. 83 (referring to China's Working Party Report, 
paragraph 235, (Exhibit USA -7)). 
279 China's first written submission, paras. 96 -98. 
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  that Part IV of China 's Schedule establishes a Base Total AMS of "zero" and a final bound commitment 
level of "nil"280 and that, i n these circumstances, Article 7.2(b) of the Agreement on Agriculture 
applies. China argues that pursuant to  Articles 3.2, 6.3 and 7.2(b), read together with Part IV of 
China 's Schedule, China may not provide non -exempt domestic support in excess of its applicable 
de minimis  commitment levels.281  
7.119.   Regarding the de minimis level, China refers to Article 6.4  and argues that it  would have 
permitted China, as a developing country, to provide product -specific domestic support that does 
not exceed 10% of the total value of production of the basic agric ultural product during the relevant 
year. However,  China explains that  paragraph 235 of China 's Workin g Party Report , which according 
to China is incorporated into China's Accession Protocol pursuant to paragraph 1.2 of this  Accession 
Protocol and paragrap h 342 of China's Working Party Report,  limits China's  de minimis level at only 
"8.5 per cent of the total value of production of a basic agricultural product during the relevant 
year".282 For China,  as long as it provides product -specific domestic support for a basic agricultural 
product equivalent to, or less than, 8 .5% of the value of that product, China is not required to include 
such support in its Current Total AMS under Articles 3.2 and 6.3.283  
7.120.   Having presented the parties' arguments in this respect, w e now set out our interpretation 
of the mentioned provisions. We begin by noting the text of the provisions invoked by the United 
States. Article 3.2 of the Agreement on Agriculture provides : 
Article 3  
Incorporation of Concessions and Commitments  
2. Subjec t to the provisions of Article  6, a Member shall not provide support in favour 
of domestic producers in excess of the commitment levels specified in Section  I of 
Part IV of its Schedule.  
7.121.   Article 6.3 of the Agreement on Agriculture provides : 
Article 6  
Domes tic Support Commitments  
A Member shall be considered to be in compliance with its domestic support reduction 
commitments in any year in which its domestic support in favour of agricultural 
producers expressed in terms of Current Total AMS does not exceed t he corresponding 
annual or final bound commitment level specified in Part IV of the Member's Schedule.  
7.122.   We also note that China 's Base Total AMS is set at zero and that the  "Final Bound 
Commitment Level" is specified as "nil" in Section I of Part IV of Chin a's Schedule CLII, which 
provides as follows:284  
SECTION I - Domestic Support: Total AMS Commitments  
BASE TOTAL AMS     Final bound commitment levels  
- 0 -         Nil 
7.123.    From the above, we observe that pursuant to Article 3.2 of the Agreement on Agriculture, 
Members can provide domestic support in favour  of domestic producers as long as it is not in excess 
of the commitments undertaken by each Member, as contained in Part IV of its Schedule.  In turn,  
Article 6.3 sets out that i n assessing a Member's compliance with its domestic support reduction 
                                                
280 China's first written submission, para. 108 (referring to China's Total AMS Commitments, (Exhibit 
CHN-52)). 
281 China's first written submission, para. 100.  
282 China's first written submission, para. 102 (referring to paragraph 1.2 of China's Accession Protocol).  
283 China's first written submission, para. 102.  
284 China's Total AMS Commitments, (Exhibit CHN -52). WT/DS511/ R 
 
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  commitments, it is necessary to compare the Current Total AMS and the corresponding domestic 
support commitment . In the context of this  particular dispute, these provisions indicate that , when 
assessing China's compliance with its domestic support commitments, the Panel must calculate 
China's Current Total AMS. The Panel is then called upon to compar e the resulting values with China's  
"nil" commitment .  
7.124.   We also observe that  pursuant to Ar ticle 6.4 of the Agreement on Agriculture , a Member's 
Current Total AMS does not include any product -specific AMS values that are below  or equal to  the 
de minimis  level of support, which, in China's case, is 8.5%.285 In practical terms,  this means that 
China's compliance with its domestic support commitments will be contingent on whether the AMS 
for each product  and each of the years at issue  remain s below  or equal to the  8.5% of the total 
value of production of the product in question . Therefore, i n assessing the obligations contained in 
Article 3.2 and 6.3 of the Agreement on Agriculture, the Panel will need first to calculate China's 
AMS in order to arrive at a calculation of China's Current Total AMS.  
7.125.   In this regard, Article 1 of the Agreement on  Agriculture defines AMS and Total AMS. The 
relevant part of Article  1(a) defines "Aggregate Measurement of Support " and "AMS" as : 
[T]he annual level of support, expressed in monetary terms, provided for an agricultural 
product  in favour of the producers o f the basic agricultural product or non -product  
specific support provided in favour of agricultural producers in general, other than 
support provided under programmes that qualify as exempt from  reduction under Annex 
2 to this Agreement , which is:  
… 
(ii)  with respect to support provided during any year of the implementation period 
and thereafter, calculated in accordance with the provisions of Annex 3 of this 
Agreement and taking into account the constituent data and methodology used 
in the tables of suppo rting material incorporated by reference in Part IV of the 
Member's Schedule   
7.126.    Similarly, Article 1(h) defines "Total Aggregate Measurement of Support" and "Total AMS" 
as: 
[T]he sum of all domestic support provided in favour of agricultural producers, 
calculated as the sum of all aggregate measurements of support for basic agricultural 
products, all non -product -specific aggregate measurements of support and all 
equivalent measurements of support for agricultural products, and which  is: 
… 
(ii)  with respect to the level of support actually provided during any year  of the 
implementation period and thereafter (i.e. the " Current Total AMS"), calculated 
in accordance with the provisions of this Agreement, including  Article 6, and with 
the constituent data and met hodology used in the tables of supporting material 
incorporated by reference in Part IV of the Member 's Schedule  
7.127.   From the above definitions, we note that  both AMS and Total AMS  relate to a monetary 
value of the support granted to producers of basic agricul tural products. AMS generally may be 
product - or non -product specific and in this case refers to the amount of support provided to a 
number of specified products , i.e. wheat and rice . Total AMS  is the sum of all of the separate 
product -specific AMS, as wel l as any non -product specific AMS and equ ivalent measurements of 
support, using the exclusionary rules contained in Article 6.4 regarding AMS levels below the de 
minimis  level and in Article 6.5 regarding direct payments under production -limiting programme s. 
When calculated for a specific year, it becomes the Current T otal AMS . 
                                                
285 China's Working Party Report,  para. 235, incorporated into China's Accession Protocol by para. 3 42 
(Exhibit USA -7). WT/DS511/ R 
 
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  7.128.   We therefore note that in assessing China's compliance with the obligations contained in 
Article s 3.2 and 6.3 of the Agreement on Agriculture, the Panel will need to calculate China' s product -
specific AMS provided through market price support for rice and wheat for each year,  as defined in 
Article 1 of the Agreement on Agriculture, and compare it to China's de minimis  level. If  the amount 
of any such product -specific AMS is above the 8.5% de minimis  level, the Panel will include that 
amount  in China's Current Total AMS for that year.  The Panel will then compare the  resulting  Current 
Total AMS  against China's final bound commitment of "nil". In this connection, the actual calculation  
of the Current Total AMS is a crucial component of the Panel's assessment. We explore this  notion  
in the next section.  
7.4.3   Calculation of AMS and Current Total AMS under the Agreement on Agriculture  
7.129.   As discussed in the previous section, Article 1 of the Agreeme nt on Agriculture sets out the 
definitions of AMS, Total AMS and Current Total AMS. This same provision also establishes the 
manner in which these measurements of domestic support  should be cal culated. In particular, 
Article  1(a)(ii) states that AMS is to be "calculated in accordance with the provisions of Annex 3 of 
this Agreement and taking into account the constituent data and methodology used in the tables of 
supporting material incorporated by reference in Part IV of the Member's Schedule ". Similarly, Article 
1(h)(ii) establishes that Current Total AMS is to be " calculated in accordance with the provisions of 
this Agreement,  including  Article 6 , and with the constituent data and methodology used in the 
tables of supporting material incorporated by refer ence in Part IV of the Member's Schedule ". From 
the text of Article 1, and as noted in paragraph  7.124 above , we note that the calculation of Current 
Total AMS follows a sequential process where the AMS for each specific product needs to be 
calculated before a corresponding Current Total AMS can be arrived at. We also observe that the 
Agreement on Agriculture establishes other important rules to follow when calcu lating both AMS and 
Current Total AMS.  
7.130.   As a starting point in our analysis, we note that Article 1 set s out that both the provisions of 
Agreement on Agriculture, including Annex 3, and the CDM contained in the tables of supporting 
material, have to be use d when calculating AMS and Current Total AMS.  
7.131.   This understanding is also shared by the parties. In this connection, China argues that the 
starting point to calculate AMS and Total AMS are Articles 1(a)(ii) and 1(h)(ii) and that the definitions 
of AMS and T otal AMS found in each of these Articles require the calculation of AMS on the basis of 
two sources of input: (i) the provisions of Annex 3 and (ii) "the constituent data and methodology 
used in the tables of supporting material  incorporated by reference i n Part IV of the Member's 
Schedule".286 For China, the CDM incorporated by reference in Part IV of a Member's Schedule is a 
Member -specific additional source of treaty text that is relevant to the calculation of AMS, including 
in the context of market price support under the general framework provided by Paragraph s 8 and 
9 of Annex 3.287The United States argues that Article 1(a)(ii) specifies that AMS is to be "calculated 
in accordance with the provisions of Annex 3 of this Agreement" , and that it is to be calc ulated 
"taking into account the constituent data and methodology used in the tables of supporting material 
incorporated by reference in Part IV of the Member's Schedule."288 
7.132.   We have established that Article 1 (a) and (h)  direct us to use both the provisions o f the 
Agreement on Agriculture, including Annex 3, and China's CDM, when calculating AMS and Current 
Total AMS, and that AMS has to be calculated first . We now move to  address the provisions of the 
Agreement on Agriculture that are directly relevant for th is task.  
7.133.   Annex 3289 elaborates on some essential parameters that inform the calculation of AMS from 
domestic support provided through market price support .  
7.134.   First, Paragraph 1 sets out that AMS shall be calculated on a product -specific basis for each 
basic a gricultural product receiving market price support, non -exempt direct payments, or any other 
                                                
286 China's first written submission, para. 112.  
287 China's first written submission, para. 115.  
288 United States' first written submission, para. 87 (referring to Article 1(a)(ii) of the Agreement on 
Agriculture).  
289 We note that this Annex  is titled "Domestic support – Calculation of Aggregate Measurement of 
Support".  WT/DS511/ R 
 
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  subsidy not exempted from the reduction commitment. This provision also states that support which 
is non -product specific shall be totalled into one non -product -specific AMS in total monetary terms.  
7.135.   Second, Paragraph 7 mandates that "AMS shall be calculated as close as practicable to the 
point of first sale of the basic agricultural product concerned".  
7.136.   Third, Paragraph 8 provides  the formula that is to be  used when calculating AMS from market 
price support  (the MPS formula): "market price support shall be calculated using the gap between a 
fixed external reference price and the applied administered price multiplied by the quantity of 
production eligible to  receive the applied administered price ": 
 𝑀𝑎𝑟𝑘𝑒𝑡  𝑃𝑟𝑖𝑐𝑒  𝑆𝑢𝑝𝑝𝑜𝑟𝑡  =(𝑃𝐴𝑝𝑝𝑙𝑖𝑒𝑑  𝐴𝑑𝑚𝑖𝑛𝑖𝑠𝑡𝑒𝑟𝑒𝑑 −𝑃𝐹𝑖𝑥𝑒𝑑  𝐸𝑥𝑡𝑒𝑟𝑛𝑎𝑙 )∙𝑄𝐸𝑙𝑖𝑔𝑖𝑏𝑙𝑒  𝑝𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑜𝑛  
 
Where:  
𝑃𝐴𝑝𝑝𝑙𝑖𝑒𝑑  𝐴𝑑𝑚𝑖𝑛𝑖𝑠𝑡𝑒𝑟𝑒𝑑 =𝐴𝑝𝑝𝑙𝑖𝑒𝑑  𝐴𝑑𝑚𝑖𝑛𝑖𝑠𝑡𝑒𝑟𝑒𝑑  𝑃𝑟𝑖𝑐𝑒   
 
𝑃𝐹𝑖𝑥𝑒𝑑  𝐸𝑥𝑡𝑒𝑟𝑛𝑎𝑙 =𝐹𝑖𝑥𝑒𝑑  𝐸𝑥𝑡𝑒𝑟𝑛𝑎𝑙  𝑅𝑒𝑓𝑒𝑟𝑒𝑛𝑐𝑒  𝑃𝑟𝑖𝑐𝑒   
 
𝑄𝐸𝑙𝑖𝑔𝑖𝑏𝑙𝑒  𝑝𝑟𝑜𝑑𝑢𝑐𝑖𝑜𝑛 =𝑄𝑢𝑎𝑛𝑡𝑖𝑡𝑦  𝑜𝑓 𝐸𝑙𝑖𝑔𝑖𝑏𝑙𝑒  𝑃𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑜𝑛  
 
7.137.   Fourth , Paragraph 9 states that the FERP "shall be based on the years 1986 to 1988 and 
shall generally be the average f.o.b. unit value for the basic agricultural product concerned in a net 
exporting country and the average c.i.f. unit value for the basic agricult ural product concerned in a 
net importing country in the base perio d".  
7.138.   Having noted the most important provisions in the Agreement on Agriculture that define how 
AMS from market price support should be calculated, we move to discuss the second element tha t 
is to be used in this calculation, namely, the CDM. In this regard, we recall that Articles 1(a )(ii) and 
1(h)(ii) both direct the Panel  to use " the constituent data and methodology used in the tables of 
supporting material incorporated by reference in Pa rt IV of the Member's Schedule". China's CDM is 
found  in the tables of supporting material  contained in  document  WT/ACC/CHN/38/Rev.3  (Rev.3) .290 
We note, however, that the manner in which China's  CDM should  directly inform the Panel's 
calculation of AMS is l ess clear. This is so mainly because (i ) the tables of supporting material  do 
not identify  what comprises  the constituent data and methodology  that should be used to calculate 
AMS, and (ii) the difference in language of Articles 1(a) (ii) and 1( h)(ii) when referring to the usage 
of the CDM.   
7.139.   Regarding the first issue mentioned above, we must differentiate between the elements that 
should inform the calculation of China's AMS, (i.e. the CDM ), and where these elements are found , 
(i.e. in the tables of supporting material  incorporated by reference into Part IV of China's Schedule ). 
In this connection, we recall that the definitions contained in Article 1 of the Agreement on 
Agriculture only direct the Panel to use the CDM, and not t he entirety of the tables of supporting 
material, when calculating AMS and Current Total AMS . For this reason, although Rev.3 contains 
China's  tables of supporting material , and the mentioned tables  contain the CDM, the Panel would 
need to discern which of  the elements contained in these  tables are CDM. In other words, the text 
of Article 1 suggest s that not everything that is contained in the tables of supporting material  and 
Rev.3 should inform the calculation of AMS , but only the constituent data and met hodology  found in 
those tables.  
7.140.    In this regard, we observe that the Agreement on Agriculture does not provide a precise 
definition of "constituent data and methodology".  
7.141.   China argues that the phrase "constituent data and methodology ", means "those data an d 
methodologies in a Member 's Supporting Tables  that are characteristic, formative, essential, and 
integral for the calculation of both Base and Current AMS and Base Total AMS and Current Total 
                                                
290 WT/ACC/CHN/38/Rev.3, (Exhibit USA -43). 
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  AMS."291 According to  China,  the dictionary meaning of "data" refers to "an item of information "292 
and that i n the context of calculating AMS , Total AMS and market price support,  the term "data" 
encompasses  any numbers and figures used and may include, for example, the numerical values of 
the FERP, the AAP, and eligible  production.293 China also argues that the dictionary meaning of 
"methodology " refers to any "method or body of methods used in a particu lar field of study or 
activity "294, and that in the context of calculating AMS and Total AMS, this term  may include the 
types of calculations to be performed in calculating AMS ( i.e. the relevant formula e), and the 
methods to be used to determine relevant input data .295 
7.142.   The United States argues that the ordinary meaning of the terms "the constituent data and 
methodology " include s the country -specific facts, information, modes, or procedures that are 
characteristic of domestic support and the agriculture sector of the M ember at the time of 
accession.296 For the United States, t his information is found in tables of supporting materia l used 
to support or explain the basis for a Member 's proposed Final Bound Commitment Level . The United 
States also argues that  "data" is defined as "[f]acts, esp. numerical facts, collected together for  
reference or information …"297, "method, " is defined as "[a] mode of procedure; a (defined or 
systematic) way of doing things ;"298 "methodology " is defined as "[a] body of methods used in a 
particu lar branch of study or activity; " and "constituent " is defined as "[t]hat makes a thing what it 
is," or is "characteristic."299  
7.143.   We turn to the ordinary meaning of "constituent". As an adjective, it means "that constitutes 
or makes a thing what it is ; formative, essential; characteristic".300 "Data" is defined as "r elated 
items of (chiefly numerical) informati on considered collectively  … used for reference, analysis, or 
calculation ."301 Finally, "methodology" is defined generally as " a method or body of methods used in 
a particular field of study or activity ".302 Similarly, a "method" is defined generally as " a mod e of 
procedure in any activity " or particularly as "a  special form of procedure or characteristic set of 
procedures employed (more or less systematically) in an intellectual discipline or field of study as a 
mode of investigation and inquiry ".303 We also und erstand that due to the grammatical construction 
of the phrase, the adjective "constituent" modifies both the words "data" and "methodology" such 
that the phrase can be said to refer to 'constituent data' and 'constituent methodology'.304 This 
implies that e ach of the relevant data and methodologies referred to must be in some way formative 
or characteristic of the tables of supporting material.  
                                                
291 China's response to Panel question No. 73 (second substantive meeting).  
292 China's response to Panel question No. 73 (second substant ive meeting) (referring to Oxford English 
Dictionary, OED Online, "data, n", available at: http://www.oed.com/view/Entry/296948? (last viewed 26 
October 2017) (Exhibit CHN -56)). 
293 China's first written submission, para. 143; China's response to Panel quest ion No. 73 (second 
substantive meeting).  
294 China's response to Panel question No. 73 (second substantive meeting) (referring to Oxford English 
Dictionary, OED Online, "methodology, n", available at: http://www.oed.com/view/Entry/117578? (last viewed 
26 Oct ober 2017) (Exhibit CHN -55)). 
295 China's response to Panel question No. 73 (second substantive meeting).  
296 United States' response to Panel question No. 73 (second substantive meeting).  
297 United States' response to Panel question No. 73 (second substantive meeting) (referring to Shorter 
Oxford English Dictionary , "data," vol. I, p. 594 (ed. 1993)).  
298 United States' response to Panel question No. 73 (second substantive meeting) (referring to Shorter 
Oxford English Dictionary , "method", "methodology," vol. I, p. 1759 (ed. 1993)).  
299 United States' response to Panel question No. 73 (second substantive meeting) (referring to Shorter 
Oxford English Dictionary , "constituent," vol. I, p. 488 (ed. 1993)).  
300 Oxford English Dictionary Online,  definition of  "constituent", available at: 
<http://www.oed.com/view/Entry/39840 >, accessed 8 June 2018.  
301 Oxford English Dictionary Online,  definition of  "data", available at: 
<http://www.oed.com/view/Entry/296948 >, accessed 8 June 2018.  
302 Oxford English Dictionary Online,  definition of  "methodology", available at: 
<http://www.oed.com/view/Entry/117578 >, accessed 8 June 2018.  
303 Oxford English Dictionary Online,  definition of  "method", available at: 
<http://www.oed.com/view/Entry/117560 >, accessed 8 June 2018.  
304 The United States noted that, given the grammatical co nstruction of the phrase, the adjective 
"constituent" modifies both nouns, "data" and "methodology". United States' response to Panel question No.  73 
(second substantive meeting). China similarly noted its understanding that the term "constituent" qualifie s 
both the terms "data" and "methodology". China's response to Panel question No. 73 (second substantive 
meeting).  
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  7.144.   As a whole, taken in the context of Articles 1(a) and 1(h) of the Agreement on Agriculture, 
the Panel understands t he phrase "constituent data and methodology" to mean those pieces of 
(chiefly numerical) information and/or modes of procedure which are characteristic of and essential 
for the understanding and calculation of a Member's AMS, as found in that Member's tabl es of 
supporting material.  
7.145.   We now turn to the second issue, that is, the differen t language  in Articles 1(a) (ii) and 
1(h)(ii) when referring to the use of the CDM . We observe  that the term CDM is mentioned three 
times in the Agreement on Agriculture: in the definition of "AMS" of Article 1(a) (ii), in the definition 
of "Equivalent Measurement of Support" of Article 1(d)(ii), and in the definition of "Current Total 
AMS" of Artic le 1(h) (ii). In all  three  of these provisions, CDM is used in the context of how these 
measurements of domestic support are to be calculated. We also note that while the first two 
provisions use the language " calculated … taking into account  the constituen t data and methodology" 
(emphasis added), the third provision uses different language: "calculated  in accordance with  … the 
constituent data and methodology " (emphasis added).  
7.146.   The parties have also noted the different  language of Articles 1(a) (ii) and 1( h)(ii), 
particularly of the words "taking into account the [CDM]" and " calculated  in accordance with … the 
[CDM]".  
7.147.   Regarding Article 1(a)(ii) , China contends that  it uses the phrase "taking into account " when 
referring to "the constituent data and methodology … incorporated by reference in Part IV of the 
Member 's Schedule ". China submits that t he dictionary meaning of "to take into account " is "to 
include something in an account or reckoning, to take into consideration, especially as a contributory 
factor; to notice ".305 According to China , similarly to Article 1(h)(ii), Article 1(a)(ii) emphasizes the 
role of "the constituent data and methodology … incorporated by reference in Part IV of the Member 's 
Schedule " in calculating AMS.306 China, however, cont ends that the dictionary meanings of the terms 
(i) "in accordance with " in Article 1(h)(ii) ; and (ii) "in accordance with " and "taking into account " in 
Article 1(a)(ii) do not fully address the relationship between (i) the terms of Annex 3 and (ii) "the 
constituent data and methodology … incorporated by reference in Part IV of the Member 's 
Schedule ".307 
7.148.   China claims that  the context that Articles 1(a) and 1(h) provide for one another calls for 
AMS and Current Total AMS calculations on the basis of an approach  that gives meaning to both 
Annex 3 and the CDM. For China, this is achieved  by using a holistic approach and a harmonious 
reading of (i) Annex 3 as providing the general framework for the calculation of AMS and (ii) a 
Member 's "[CDM] used in the tables of  supporting material incorporated by reference in Part IV of 
the Member 's Schedule ", as providing additional detail to fill in that framework for the calculation of 
AMS.308  
7.149.   In this connection, China argues that Articles 1(a)(ii) and 1(h)(ii) provide relevan t context 
for each other 's interpretation , as both concern the calculation of domestic support , and claims that 
the Appellate Body in Korea – Various Measures on Beef  speculated that Article 1(a)(ii) could be 
read to attribute "higher priority to 'the provisions of Annex 3 ' than to [a Member 's] 'constituent 
data and methodology '",309 based on the use of "in accordance with " and "taking into account ". 
China notes, h owever, that the Appellate Body also recognized that "this difference is not reflected 
in [the] wording of the definition of Cur rent Total AMS in Article 1(h) ".310 China contends this is 
because by using the phrase "in accordance with " for both (i) "the provisions of this Agreement ", 
including Annex 3, and (ii) "the [CDM]  used in the tables of supp orting material incorporated by 
                                                
305 China's first written submission, para. 126 (referring to Oxford English Dictionary , OED Online, "to 
take account of, n.", pp. 21 -22, avail able at: http://www.oed.com/view/Entry/1194? (last viewed 26 October 
2017) , (Exhibit CHN -54)). 
306 China's first written submission, para. 126.  
307 China's first written submission, para. 128.  
308 China's first written submission, para. 131.  
309 China's first written submission, para. 129 (referring to Appellate Body Report, Korea – Various 
Measures on Beef , para.  112).  
310 China's first written submission, para. 129 (referring to Appellate Body Report, Korea – Various 
Measures on Beef , footnote  [48] (underlining added)).  
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  reference in Part IV of the Member 's Schedule ", Article 1(h)(ii) attributes equal importance to both 
provisions.311 
7.150.   China further argues that t he panel in Korea – Various Measures on Beef  also highlighted 
the "complementary "312 nature of Articles 1(a)(ii) and 1(h)(ii) in providing guidance for the 
calculation of AMS and Current Total AMS, respectively.  China claims that i t follows that the 
calculations must be undertaken in a parallel manner, and the calculation of AMS cannot be 
undertaken on a basis that differs from that applicable to the calculation of Total AMS.  China 
contends that  the panel in Korea – Various Measures on Beef  properly identified the reason for the 
complementary nature of these provisions in the following terms:  "all these concepts, e.g. domestic 
support, AMS, Current Total AMS, and total domestic support and the provisions of Articles 1(a), 
1(h), 3.2, 6.4, […] are organically and inextricably linked ".313 China claims that i n these 
circumstances, to ensure co herent calculations, the same data and methodology must be applied for 
the calculations of AMS and its sum as Current Total AMS.314  
7.151.   The United States disagrees with China's interpretation. Key to its contention is the notion 
that Articles 1(a)(ii) and 1(h)(ii) each address a different stage of the AMS calculation. In this vein, 
the United States argues that t he product -specific AMS cal culation in Article 1(a)(ii) addresses the 
evaluation of domestic support provide d on a product -by-product basis, and that  the Current Total 
AMS described in Article 1(h)(ii) is the summing of all product -specific AMS, after considering 
whether relevant de minimis  criteria and other considerations set out in Article 6 have been met.315 
7.152.   For the United States,  Article 1(a)(ii) specifies that for support provided in any year after 
implementation, product -specific AMS is "calculated in accordance  with the provisi ons of Annex 3 of 
this Agreement " and that  Article 1(a)(ii) continues by stating that, in addition to complying with 
Annex  3, AMS is calculated "taking into account the constituent  data and methodology used in  the 
tables of support material ". According to the United States, t he inclusion of the phrase "in accordance 
with" in Article 1(a)(ii) indicates that a product -specific AMS calculation must be conducted in 
"conformity " with the methodology provided in Annex 3, and that c onversely, the use of the phrase 
"taking into account " in reference to constituent data and methodology requires a panel to "take 
into consideration, [or] notice " that information.316 The United States submits that t his indicates that 
a lesser degree of cons ideration is accorded to any con stituent data and methodology.317  
7.153.   The United States further submits that a fter a panel has calculated the various product -
specific AMS for a particular year as set out in Article 1(a)(ii), it is directed to turn to aggregatin g 
these constituent parts to calculate the  Current Total AMS for each of these years. For the United 
States, t he first phrase of Article 1(h)(ii), "in accordance with the provisions of this Agreement, 
including Article 6, " indicates that the calculation mu st be consistent with the binding commitments 
in the Agreement on Agriculture , and highlights Article 6, which provides information on de minimis  
levels an d other exemptions as relevant, and that t he second direction in Article 1(h)(ii) states that 
Current  Total AMS is "calculated … with the constituent data and methodology. " The United States 
claims that "with" in this context can mean "by use of (a thing) as an instru ment or means … by 
means of "318 and that t his is a less demanding requirement than "in accor dance with. "319 
7.154.   Responding to China's arguments regarding Article 1(h)(ii), the United States submits that  
the phrase "in accordance with, " which is applicable to the first phrase, does not extend to the 
second phrase, as  grammatically, "in accordance with " and "with" are sepa rate and distinct 
                                                
311 China's first written submission, para. 129.  
312 China's first written submission, para. 130 (referring to Panel Report, Korea – Various Measures on 
Beef, para. 812).  
313 China's first written submission, para. 130 (referring to Panel  Report, Korea – Various Measures on 
Beef, para. 813).  
314 China's first written submission, para. 130.  
315 United States' response to Panel question No. 62 (second substantive meeting).  
316 United States' response to Panel question No. 62 (second substantive meeting) (referring to 
Appellate Body Report, Korea – Various Measures on Beef , para. 111 ( citing  The New Shorter Oxford English 
Dictionary, (Clarendon Press, 1993), Vol.  I, p. 15)).  
317 United States' response to Panel question No. 62 (second substantive meeting).  
318 United States' response to Panel question No. 62  (second substantive meeting)  (referring to Shorter 
Oxford English Dictionary , "with," vol. II, p. 3703 -04 (ed. 1993)).  
319 United States' response to Panel question No. 62 (second substantive meeting).  
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  prepositions. The United States claims that i f "in accordance with " was intended to apply to both 
objects (the Agreement and the constituent data and methodology), the second "with" would be 
superfluous.  The United States argues that  even if this phrase were to be understood as "in 
accordance with " the constituent data and methodology, this would refer to constituent data and 
methodology fo r purposes of Article 1(h)(ii),  that is, calculation of Current To tal AMS. For the United 
States, t he "constituent " data and methodology would only be that releva nt to the operation in 
question, i.e.  the consideration of de minimis  levels and summing of current product -specific AMS 
and non -product -specific AMS, as approp riate.320  
7.155.   The United States also responds to China's arguments that "context " and proximity suggest 
that these terms should be interpreted to provide the same direction with regard to calculati on of 
AMS and Current Total AMS321, and claims that  this interpret ation is not supported by the text of 
Articles 1(a) and 1(h) as understood applying customary rules of interpretation (Articles 31 -32 of 
the VCLT) .322 
7.156.   We begin by noting that while the parties recognize the difference in the language in Articles 
1(a)(ii) and 1(h)(ii) when referring to the usage of the CDM, they both extract different conclusions 
on how the Panel should interpret them. While China contends that AMS must be calculated 
consistently for purposes of both AMS and Total AMS calculations323, and that the calculations must 
be unde rtaken in a parallel manner, implying that  the calculation of AMS cannot be undertaken on 
a basis that differs from that applicable to the calculation of Total AMS324, the United States 
emphasises that Articles 1(a)(ii) and 1(h)(i i) each address a different stage of the calculation of 
AMS, thereby implying that the differences in the language should be applied to the respective stage 
of the calculation.  
7.157.   We recall that, as stated  in paragraph 7.129 above , the calculation of Current Total AMS 
follows a two -step process where product -specific AMS, as defined in Article 1(a)(ii), has to be 
calculated first. The resulting AMS for different prod ucts would then need to be subjected to Article 
6.4 of the Agreement on Agriculture and the support exceeding the de minimis  level aggregated in 
order to obtain the Current Total AMS, as defined in Article 1(h)(ii). This Current Total AMS would 
then be com pared to a Member's domestic support commitments. Therefore, although 
Articles  1(a)(ii) and 1(h)(ii) can be said to be organically and inextricably linked325, they each relate 
to a different stage of the overall  calculation of AMS. These conceptual differenc es, in turn, are 
reflected in the language of the two provisions. For these reasons, we consider that the calculations 
must be undertaken sequentially.  Furthermore, the concrete application of the CDM may vary 
depending on whether AMS or Current Total AMS is being calculated.  
7.158.   We generally agree with China that the calculation of Current Total AMS should be done on 
the basis of an approach that gives meaning to both Annex 3 and the CDM, by using a holistic 
approach and a harmonious  interpretation of the diff erent provisions of the Agreement on 
Agriculture.326 However, such an interpretation should not lead to a result where the textual 
differences in either provision are read out, without more, especially in a situation where there 
appear to be important differ ences in the manner in which AMS and Current Total AMS are to be 
calculated.  
7.159.   We note that the Appellate Body has already addressed some of these issues in the past. 
Indeed, in Korea – Various Measures on Beef  it noted that:  
Article 1(a)(ii) contains two e xpress requirements for calculating Current AMS. First, 
Current AMS  is to be "calculated in accordance with the provisions of Annex 3 of this 
Agreement". The ordinary  meaning of "accordance" is "agreement, conformity, 
                                                
320 United States' response to Panel question No. 62 (second substantive meeting).  
321 United States' response to Panel question No. 62 (second substantive meeting) (referring to China's 
second written submission, paras. 296 -305; China's first written submission, paras. 135 -139).  
322 United States' response to Panel question No. 62 (second substantive meeting).  
323 China's comments on United States' response to Panel question No. 62 (second sub stantive 
meeting).  
324 China's first written submission, para. 130.  
325 Panel Report, Korea – Various Measures on Beef , para. 813.  
326 China's first written submission, para. 131.  
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  harmony".327 Thus, Current AMS must be  calculated in "conformity" with the provisions 
of Annex 3. Second, Article 1(a)(ii) provides that the  calculation of Current AMS is to 
be made while "taking into account the constituent data and  methodology used in the 
tables of supporting material incorpor ated by reference in Part IV of the  Member's 
Schedule." "Take into account" is defined as "take into consideration, notice".328 Thus, 
when  Current AMS is calculated, the "constituent data and methodology" in a Member's 
Schedule must be  "taken into account", that is, it must be "considered".329 (emphasis 
original)  
7.160.   Of particular importance in this discussion is a footnote to the above paragraph, where the 
Appellate Body noted that:  
[T]his difference is not reflected in the wording of the definition of Current Tot al AMS in 
Article 1(h). Article 1(h)(ii) provides that Current Total AMS is to be calculated "in 
accordance with the provisions of this Agreement, including Article 6, and with the 
constituent data and methodology used in the tables of supporting material incorporated 
by reference in Part IV of the Member's Schedule".330 
7.161.   The Appellate Body also observed that, in the wording of Article 1(a)(ii) itself, a hig her 
priority is attributed to "the provisions of Annex 3" than to the "constituent data and methodology" , 
as the ordinary meaning of the term "in accordance with" reflects a more rigorous standard than the 
term "taking into account".331 The Appellate Body then went on to describe this difference as 
involving an "apparent hierarchy" . Therefore, the Appellate Bo dy has already noted the potential 
differences in the usage of a Member's CDM, depending on whether the current AMS or Current Total 
AMS is being calculated. 332  
7.162.    However, in that dispute , the panel and Appellate Body found that there was no constituent 
data and methodology for beef333, and as such, it was not necessary to decide how a conflict between 
"the provisions of Annex 3" and the "constituent data and methodology used in the tables of 
supporting material incorporated by reference in Part  IV of the Memb er's Schedule" would have to 
be resolved.334 Indeed, the Appellate Body appears to have considered , on an arguendo  basis, that  
in spite of the wording of Article 1(a)(ii),  there may be circumstances in which  a panel could  be 
justified in giving priority to t he CDM used in the tables of supporting material over the guidance of 
Annex 3 for products entering into the calculation of the Base Total AMS.335 In any event , we note 
that the facts of Korea – Various Measures on Beef stand  in contrast to the present case : China's 
tables of supporting material contain information that may well be deemed to be CDM for wheat and 
rice.  
7.163.   For these reasons, these previous statements by the Appellate Body have to be taken with 
caution, recognizing that the consequences in the dif ference in wording between Articles 1(a)(ii) and 
1(h)(ii) were not directly addressed there.  
7.164.   We therefore consider that  we should take " into account " the CDM, if available,  when 
calculati ng AMS in line with the  wording in Article 1(a)(ii), and to give a h igher priority to the wording 
                                                
327 (footnote original) The New Shorter Oxford English Dictionary , (Clarendon Press,  1993), Vol. I, p. 15.  
328 (footnote original) The New Shorter Oxford English Dictionary , (Clarendon Press, 1993), Vol. I, p. 15.  
329 Appellate Body Report, Korea – Various Measures on Beef , para. 111.  
330 Appellate Body Report, Korea – Various Measures on Beef , fn 48.  
331 Appellate Body Report, Korea – Various Measures on Beef , para. 112.  
332 We also note that the Appellate Body opined that the panel's reasoning was not based on this 
"apparent hierarchy", but noted that rather, on the contrary, the panel considered that the constituent data 
and methodology has an important role to play in ensuring that the calculation of support to any given product 
is calculated in subsequent years consistently with support calculated in the base period. Appellate Body 
Report, Korea  – Various Measures on Beef , para. 113 and fn 49.  
333 Panel Report, Korea – Various Measures on Beef , para. 812, Appellate Body Report, Korea – Various 
Measures on Beef , para. 114.  
334 Appellate Body Report, Korea – Various Measures on Beef , para. 114.  
335 Appel late Body Report, Korea – Various Measures on Beef , para. 114. The Appellate Body went on to 
state that "giving such priority would seem to be unwarranted when calculating Current AMS for a product 
which did not enter into the Base Total AMS calculation." This situation does not seem to be present in this 
dispute.  
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  of Annex 3.336 In this same vein,  we are of the view that both Annex 3 and the CDM should be given 
equal consideration when calculating the Cu rrent Total AMS, as per Article  1(h)(ii).  
7.165.   We observe, however, that it may not suffice  to assess the differences in the language of 
Article s 1(a)(ii) and 1(h)(ii) and the practical implications arising therefrom solely through the lens 
of conflict. This may end up improperly reducing the relationship between these provisions to a 
hierarchic al one, where the application of one seems to exclude the application of the other in its 
entirety. Indeed, this may end up distorting the general conception of the calculation of Current 
Total AMS under Articles 1(a)(ii) and 1(h)(ii) as being organically and inextricably linked.337 For 
these reasons, the differences in the usage of CDM for the purposes of the calculation of AMS and 
Current Total AMS should not be reduced to a situation where Annex 3 completely precludes the 
application of the CDM simply beca use the latter is only to be "taken into account". Assuming the 
existence of a conflict ex ante, without considering the possibility of a concurrent application, seems 
to us to be unwarranted.  
7.4.4   Preliminary considerations in relation to China's domestic sup port commitments  
7.4.4.1   Tables of supporting material and Member -specific domestic  support -related 
commitments  
7.166.   Before we move to discuss the parties' arguments regarding the variables of the MPS 
formula, we will first address China's view on whether the tables of  supporting material contain 
Member -specific domestic  support -related commitments.  
7.167.   China submits that while its tables of supporting material, as reflected in Rev.3, contain 
substantial text and data, it is only those elements in Rev.3 that are implicated in the calculation of 
Base Total AMS and Current Total AMS under the Agreement on Agriculture that give rise to domestic  
support -related commitments. For China, this is so because only those elements are part and parcel 
of the domestic support commitments that China has undertaken under its Accession Protocol.338 
According to China, these elements include the CDM reflected in the tables of supporting material 
that are referred to in Articles 1(a) and 1(h) of the Agreement on Agriculture, including (i) the bas e 
period, (ii) the fixed external reference prices, (iii) a methodology for the determination of eligible 
production, and (iv) the choice between a price gap methodology or budgetary outlays for non -
exempt direct payments in Paragraph  10 of Annex 3 of the Agreement on Agriculture. For China, 
these elements may also include the identification of the basic agricultural products and the years 
for which AMS is calculated under Articles 1(b) and 1(i) of the Agreement on Agriculture.339  
7.168.   The U nited States, on the other hand, contends that China's argument that the Panel can 
look to information contained in its tables of supporting material to identify China -specific 
methodologies for identification of the FERP and the quantity of eligible produ ction (QEP), 
misunderstands the relationship between the Agreement on Agriculture and a Member's Schedule 
of Concessions and tables of supporting material, as well as the role and status of information 
contained in these tables under the Agreement on Agric ulture.340 For the United States, the 
Agreement on Agriculture provides the ways in which the information contained in a Member's tables 
of supporting material may be used in the calculation of a Member's Current Total AMS, but it does 
not give rise to domes tic-support -related rights and obligations in the calculation of Current Total 
AMS.341 The United States contends that the Agreement on Agriculture directs the use of a Member's 
tables of supporting material to glean Member -specific factual information such as identifying the 
basic agricultural products in the Member's territory and definition of year for a particular program me 
but that it does not create independent rights and obligations.342  
7.169.   We begin by recalling that our task in the present dispute is to as sess China's compliance 
with its domestic support commitments under the Agreement on Agriculture. As we have stated 
                                                
336 Appellate Body Report, Korea – Various Measures on Beef , para. 112.  
337 Panel Report, Korea – Various Measures on Beef , para. 813.  
338 China's second written submission, para. 187.  
339 China's second written submission, para. 188.  
340 United States' second written submission, para. 64.  
341 United States' second written submission, para. 65.  
342 United States' second written submission, para. 65 ; United States' response to Panel question Nos. 
19, para. 94 and  65, paras. 70 -73 (second substantive meeting) . WT/DS511/ R 
 
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  before, this requires the Panel to calculate domestic support as provided through market price 
support  for rice and wheat , and as measured as Current Total AMS. These calculations are to be 
done mainly on the basis of the definitions of Article 1 of the Agreement on Agriculture, which in 
turn direct the Panel to use the provisions of Annex 3 and a Member's CDM. In this regard, we note 
that Art icle 1 only mentions the tables of supporting material , which are found in Rev.3 in the case 
of China, when setting out that it is the constituent data and methodology contained  in those tables 
that are  relevant for the calculation of AMS. For this reason,  we do not see the discussion of whether 
the tables of supporting material  give rise to domestic -support -related commitments as being a 
central one in this dispute. This is so because the text of the Agreement on Agriculture is clear that 
the central eleme nts in the calculation of Current Total AMS are Annex 3 and a Member's CDM, and 
not the tables of supporting material. These tables are only relevant inasmuch as they contain the 
CDM, the legal status of which is not in question. Article 1 provides clear i ndications pertaining to its 
relevance. We are also mindful that the Panel may well complete its task to provide a positive 
solution to the dispute without having to reach a general and overarching conclusion on the status 
of the tables of supporting mater ial.  
7.170.   We also note that China's argument was clarified during the course of the proceedings. 
Responding to a question by the Panel asking China to address statements made by the United 
States, China noted that while the United States argued that the Agreem ent on Agriculture "provides 
the ways in which the information contained in a Member's Supporting Tables may be used in the 
calculation of a Member's Current Total AMS", it also stated that this information "does not give rise 
to domestic -support related r ights and obligations".343 For China, "[t]he [United States'] first 
statement directly contradicts the second statement. Indeed, if a Member's "constituent data and 
methodology" are to be used in the calculation of Current (Total) AMS, then they necessarily give 
rise to domestic -support -related rights and obligations, because they affect the outcome of those 
calculations."344  
7.171.   In our view, this comment points to the crux of China's concern, namely, that the CDM must 
inform the calculation of Current Total AMS. China perceives the United States' position as depriving 
the CDM from having any meaningful and specific value. This comment also allows us to disaggregate 
China's general position into two components: one relating to the usage of the CDM in the 
calculatio ns of Current Total AMS and another one relating to this exercise as giving rise to domestic -
support -related rights and obligations. Regarding the first component, we have already found in 
Section 7.4.3 above  that CDM  plays an important role in th ese calculations. Thus, to this extent we 
agree with China. However, it does not follow that because the Agreement on Agriculture provides 
for the way s in which the information contained in a Member's tables of supporting material is to be 
used in the calculation of Current Total AMS the CDM or the mentioned tables necessarily give rise 
to domestic -support -related rights and obligations.  
7.172.   Therefore, becaus e (i) the role of the CDM in the calculations of Current Total AMS is already 
clarified in Article 1 and (ii) the issue of whether the tables of supporting material contain  Member -
specific domestic -support -related commitments is not essential to the resolu tion of this dispute, we 
find that it is not necessary to come to a definitive conclusion on whether the tables of supporting 
material contain Member -specific domestic -support -related commitments.345 
                                                
343 China's response to Panel question No. 67 (second substantive meeting) (referring to United States' 
second written submission, para. 65).  
344 China's response to Panel question No. 67 (second substantive meet ing). 
345 China also submitted arguments on how, for non -original Members, CDM are not only part and parcel 
of their domestic support commitments, but also of their "terms of accession" under Article XII:1 of the 
Marrakesh Agreement (China's second written submissio n, Sections IV and VIII). In reply, the United States 
argued that China's Schedule of Concessions, including Part IV, does not form part of China's Accession 
Protocol, but rather of the Schedule of Concessions and Commitments annexed to the GATT 1994 ( United 
States' second written submission, para. 74 ). Having already clarified that the role and legal status of the CDM 
is adequately defined in Article 1 of the Agreement on Agriculture, when calculating Current Total AMS, we do 
not find it necessary to addre ss these arguments.  
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  7.4.5   Issues relating to the definition and calculation of the v ariables of the MPS formula  
7.4.5.1   Applied Administered Price  
7.173.   Except for the possible processing -level adjustment  (which potentially affects the AAP) in 
order to utilize data values  at the same stage of processing of the products (specifically  rice), the 
parties agree on the basic understanding of this variable . We have discussed the AAP to a limited 
extent in section 7.2.2.1  above, and as mentioned, we agree with the part ies that when a measure 
takes the form of  market price support, the AAP is a constituent element of that measure.346 
7.174.   The United States contends that because the  Agreement on Agriculture  does not define the 
term "applied administered price", i t is necessary to determine  the ordinary meaning of these 
terms.347 The United States submits that the AAP is the price a Member dispenses or furnishes to 
support a partic ular basic agricultural product and that Paragraph 8  of Annex 3 of the Agreement on 
Agriculture  also refers to "the" AAP, suggesting that this price is known and discernible.348 The United 
States claims that t he AAP is thus the price the government sets or establishe s and is, as such, 
distinguishable from a prevailing domestic market price.349 
7.175.   The Unite d States alleges that China announces for each market price support programme  
the "minimum procurement price " at which designated state -owned enterprises will purchase wh eat, 
Indica rice, and Japonica rice .350 For the United States, t his annually announced "minimum 
procurement price " constitutes an AAP because it is the known or discernible price China dispenses  
or furnis hes for each basic agricultural product , regardless of the price that would be other wise 
determined by the market.351 The United States conten ds that t he AAPs relevant to China 's market 
price support programmes  for wheat, Indica rice and  Japonica rice are the minimum procurement 
prices identified in the annual Wheat MPS Notices  and Rice MPS Notices .352  
7.176.   China argues that t he Agreement on Agriculture  does not define "the applied administrative 
price", nor does it contain any specific guidance concerning the methodology to use to dete rmine 
this price. As a result, China relies on the dictionary meaning of the elements of the term "applied 
administered  price", coupled with the CDM, as set out in Rev.3.353 China submits that t he dictionary 
meaning of an "administered price " refers to a price "determined not by market forces but by 
administrative action (as of a large company or government) "354 and that t he dictionary meaning of 
"applied " includes "brought to bear, made effective, acting at a point or place ".355  
7.177.   The Panel agrees with the parties that it would be valuable to determine the ordinary 
meaning of the term "applied administered price". "Appl ied" is defined as "put to practical use" while 
"apply" means "put to use; employ"356, which, as the United States suggests, points to an actual, 
demonstrable action.  The Panel concurs with China's characteri zation of "administer ed" when 
referring to a price  as being defined as "determined not by market forces but by administrative 
action (as of a  large company or a government)."357 The AAP, therefore, is the price set by the 
government at which specified entities will purchase certain basic agricultural products.  
                                                
346 Annex 3 of the Agreement on Agriculture, para. 8; United States' first written submission, para. 93.  
347 United States' first written submission, para. 96 (referring to Shorter Oxford English Dictionary , 
"applied," p. 100 (ed. 1993), Shorter Oxford English Dictionary,  "administer," p. 28 (ed. 1993),  Shorter Oxford 
English Dictionary , "price," p. 2349 (ed. 1993), (Exhibit USA -64)). 
348 United States' first written submission, para. 97.  
349 United States' first written submission, para. 97.  
350 United States' first written submission, para. 106.  
351 United States' first written submission, para. 106.  
352 United States' first written submission, para. 111 . 
353 China's first written submission, para. 190.  
354 China's first written submission, para. 191 (re ferring to Oxford English Dictionary, OED Online, 
"administered, adj.", available at: http://www.oed.com/view/Entry/2532? (last viewed 26 October 2017), 
(Exhibit CHN -60)). 
355 China's first written submission, para. 193 (referring to Oxford English Dictionar y, OED Online, 
"applied, adj.", available at: http://www.oed.com/view/Entry/9713? (last viewed 26 October 2017), (Exhibit 
CHN-61)). 
356 The New Shorter Oxford English Dictionary , definition of "applied", "apply" Vol. 1, 1993, p. 100 -101. 
357 Oxford English Dictionary Online,  definition of  "administered, adj", available at: 
<http://www.oed.com/view/Entry/2532 >, accessed 27 July 2018).  
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  7.178.   We note that in the measures themselves, for the years 2012 -2015, the AAP is set out for 
each product and for each year358, 359. The AAP is referred to as the "minimum purchase price" within 
the Chinese measures, and is defined as "x yuan per jin" where 1 jin equals 0.5 kilograms, for 
standard Grade 3 product.  Certain other prices are also included in the Annual Notices for Grade 1, 
2, 4, and 5 product, which are either slightly higher or lower than the standard Grade 3 price, relative 
to the Grade of the product.360 Neither party indicated that the Panel should look to any of these 
other prices when determining an AAP , given that the maj ority of grain i s considered to be "standard" 
Grade 3 grain .361 Thus, for the purposes of the Panel's calculations, the price for the standard Grade 
3 product will be considered t o be an element of  China's  CDM for each product.  
7.179.   The following table contains t he relevant AAPs which will be used in the Panel's calculations:  
Table 2: Wheat, Indica rice and Japonica rice AAP362 
Unit: RMB/MT  2012  2013  2014  2015  
Wheat  2,040  2,240  2,360  2,360  
Early Indica rice 2,400  2,640  2,700  2,700  
Mid-Late Indica rice 2,500  2,700  2,760  2,760  
Japonica rice  2,800   3,000   3,100   3,100  
7.4.5.2   Fixed external reference price 
7.180.   The Panel is presented with a simple choice, surrounded by a number of substantial issues, 
regarding the time -period to be used to calculate the FERP: using a FERP based on the years 1986 -
1988, as the United States asserts, or one based on the years 1996 -1998, as China asserts.  
7.181.   The United States notes that pursuant to P aragraph 9  of Annex 3 , the FERP " shall be based 
on the years 1986 to 1988 and shall generally be th e average f.o.b. unit value for the basic 
agricultural product concerned in a net exporting country and the average c.i.f. unit value for the 
basic agricultural product concerned in a net importing country in the base period ." For the United 
States, t his reference to calculation of the average f.o.b.  or c.i.f. unit value of the basic agricultural 
product in the period 1986 through 1988 establishes that the FERP is one, unchanging value.363 The 
United States further contends that the ordinary meaning of the te rms in "fixed external reference 
price" suggest that this is an unchanging and definite price, relating to a foreign situation that is 
used as the basis for comparative measurement.364 According to the United States, this ordinary 
meaning corresponds to the elements in P aragraph 9  of Annex 3  and the use of f.o.b.  or c.i.f. values 
relates the reference value to prices in foreign trade, rather than internal prices; the calculation of 
an average unit value over a base period ensures the reference value is unchan ging and definite.365 
7.182.   China, on the other hand, argues that  a holistic reading of Annex 3 and Part IV of China 's 
Schedule establishes that, in calculating AMS from China's market price support for wheat and rice, 
                                                
358 See 2012 Wheat Annual Notice , (Exhibit USA -20/CHN -18B), p. 1 ; 2013 Wheat Annual Notice , 
(Exhibit USA -21/CHN -93B); 2014 Wheat Annual Notice, ( Exhibit USA -22/CHN -20B), p. 1 ; 2015 Wheat Annual 
Notice , (Exhibit USA -23/CHN -21B), p. 1 . 
359 See 2012 Rice Annual Notice, (Exhibit USA -39/CHN -23B), p. 1; 2013 Rice Annual Notice, (Exhibit 
USA-40/CHN -24B), p. 1; 2014 Rice Annual Notice, (USA -41/CHN -25B), p. 1; 2015 Rice Annual Notice, (Exhibit 
USA-42/CHN -26B), p. 1 . 
360 The 2015 instruments state that "[t]he price difference between adjacent grades will be 0.02 yuan 
per jin." Article 4, 2015 Whe at and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 3.  
361 United States' response to Panel question No. 25, para. 105; China's response to Panel question No. 
25. 
362 The AAPs for wheat, Indica rice and Japonica rice used in the calculation o f China's MPS for each 
product are the minimum procurement prices identified in the annual Wheat MPP Notices and Rice MPP Notices , 
as we found in paragraph 7.178  above . These figures were multiplied by 20 in order to derive a price per ton.  
363 United States' first written submission, para. 98.  
364 See Panel Report , Korea – Various Measures on Beef , para. 830 (which the United States argues 
states that in instances wh ere no import or export prices are available for a particular Member, Annex 3, 
paragraph 9 permits a proxy price reflecting import or export prices between 1986 and 1988 in another 
Member's market).  
365 United States' first written submission, para. 100.  
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  the FERP must be determined using the 1996-1998 period, rather than the 1986 -1988 period 
identified in Paragraph 9 of Annex 3.366 China argues that the period 1986 -1988 in Annex 3 was 
meant to be used by WTO Members joining the WTO upon the conclusion of the Uruguay Round in 
1994. China also cla ims that its use in its tables of supporting material  of the 1996 -1998 period to 
determine China's FERP is consistent with a Technical Note by the WTO Secretariat for acceding 
Members, which provides that "[i]n order to calculate a product -specific AMS for  these products, 
relevant tables from Supporting Tables DS:5 to DS:7 should be used" and that an "external reference 
price" is to be calculated from data "normally for each of the last three years".367 China contends 
that it is not unique in having applied t he Technical Note of the Secretariat and that all of the 
accessions that have taken place since the establishment of the WTO in 1995 have used base periods 
other than 1986 -1988 for the purposes of Supporting Table DS:5.368 
7.183.   Paragraph 9 of Annex 3 of the Agree ment on Agriculture provides as follows:  
The fixed external reference price shall be based on the years 1986 to 1988 and shall 
generally be the average f.o.b. unit value for the basic agricultural product concerned 
in a net exporting country and the averag e c.i.f. unit value for the basic agricultural 
product concerned in a net importing country in the base period. The fixed reference 
price may be adjusted for quality differences as necessary.  
7.184.   The plain text of this provision weighs in favour of the United States' arguments as it provides 
that the "[t]he fixed external reference price shall be based on the years 1986 to 1988".369 However, 
China has pointed to other important issues  that the Panel  needs to consider regarding how other 
non-original Members, incl uding China, have determined their FERPs in the context of market price 
support. In particular, China argues that in its calculations of the Base Total AMS, as reflected in its 
tables of supporting material, it did not use a FERP based on the period 1986 -1988.370 China also 
contends that, as a matter of fact, all of the non-original Members have used a FERP that is not 
based on the period 1986 -1988 when calculating their Base Total AMS.371 In addition to these two 
factual assertions, China also contends that th ere must be some sort of consistency or parallelism 
between the way the Base Total AMS and the Current Total AMS are calculated under the Agreement 
on Agriculture.372  
7.185.   For China, the fact that (i) its table of supporting material did not use a FERP based on the 
years set out in Paragraph 9 of Annex 3 for the calculations of its Base Total AMS, and (ii) that all 
non-original Members have not used FERPs based on the 1986 -1988 time -period referred to in this 
provision, coupled with the claim of an alleged requir ement of consistency between Base Total and 
Current Total AMS imply that Paragraph 9 of Annex 3 should not be read as an inflexible rule. In 
particular, China argues that all of these considerations imply that while the text of Paragraph 9 is 
styled as a m andatory rule, the applicable context, relevant subsequent practice and the object and 
purpose of the Agreement on Agriculture  support a more flexible interpretation that gives room for 
later-acceded Members to agree with the WTO m embership, upon their acc ession, on FERPs from a 
base period other than 1986 -1988.373  
7.186.   We will structure our analysis of China's arguments as follows: we will begin by conducting 
an assessment of the two factual claims presented by China regarding the FERPs used in the 
calculation o f the Base Total AMS by China and by other non -original Members. We will then move 
on to assess the argument of the alleged requirement of consistency in the way Base Total and 
Current Total AMS are calculated . We will then determine the FERP that should b e used in the context 
of this dispute to calculate China's Current Total AMS.  
                                                
366 China's first written submission, paras. 172 -173. 
367 China's first written submission, para. 174 (referring to WTO, Handbook on Accession to the WTO, 
Chapter 4.6, available at: https://www.wto.org/english/thewto_e/acc_e/cbt_course_e/c4s6p1_e.htm (last 
viewed  25 October 2017), pp. 3 -4 (Exhibit CHN -11) (emphasis added)).  
368 China's first written submission, para. 175.  
369 United States' first written submission, paras. 98 -100 (referring to the language of Annex 3 to the 
Agreement on Agriculture).  
370 China's first w ritten submission, paras. 51 -52, 177 -178. 
371 China's first written submission, para. 175, Table 6; China's second written submission para. 353.  
372 China's first written submission, para. 138; China's second written submission, paras. 296 -302, 345.  
373 China's second written submission, para. 320.  
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  7.4.5.2.1   FERP contained in China's tables of supporting material  
7.187.   We will now assess China's contention that its tables of supporting material did not use a 
FERP based on the period 1986 -1988 in its calculations of the Base Total AMS. China argues that its 
tables of supporting material, particularly in Table 1 of Appendix DS 5 -4 of Rev.3, provide the data 
and methodology for separate FERPs for Indica  rice and Japonica  rice duri ng the base period of 
1996-1998.374 China also argues that its tables of supporting material, particularly Appendix DS 5 -
3 of Rev.3, provide the data and methodology for the FERP for wheat  during the base period of 
1996-1998.375 
7.188.   We begin by noting that China's Supporting Table DS : 5, contained in Rev.3, sets out the 
calculation of p roduct -specific AMS from  market price support  for wheat, Japonica rice and Indica 
rice, in the years 1996 -1998. For each of the products and the years at issue, the table presents the 
different elements of the MPS Formula, namely, an "applied administered price", an "external 
reference price", and an "eligible production", as well as the results arising from the application of 
the MPS Formula376: 
Table 3 : China's Supporting Table DS: 5 (reproduced from WT/ACC/CHN/38/Rev.3 ) 
 
Description of 
Basic Products  Calendar 
year "Applied 
administered price " 
(RMB yuan/ton)  "External reference 
price" 
(RMB yuan/ton)  "Eligible 
production " 
(1000 tons)  Total market price 
support  
 (million RMB yuan)  
a) Wheat  1996 1480.0  1885.0  15000  -6075 
1997 1480.0  1629.6  15000  -2244 
1340.0  1629.6  31002  -8979 
1998 1420.0  1579.8  15000  -2397 
1260.0  1579.8  12956  -|44 
average      
b) Japonica  
 Rice 1996 2200.0  3682.9  5250  -7785 
1997 2200.0  2862.1  5250  -3476 
1971.4  2862.1  6452  -5746 
1998 2114.3  3326.9  5250  -6366 
1914.3  3326.9  3290  -4647 
average      
c) Indica Rice  1996 2142.9  3082.1  10500  -9862 
1997 2142.9  2033.0  10500  1153 
1885.7  2033.0  12903  -1901 
1998 1931.4  1913.9  10500  184 
1734.3  1913.9  6580  -1182 
     
 
7.189.   Endnotes 17 and 18 to Supporting Table DS 5 elaborate on the details of the "external 
reference price" contained therein. The former clarifies that wheat was a  net-import product in the 
1996-1998 base period, and that therefore, the external reference prices were determined by the 
c.i.f. prices, on the basis of China's customs statistics.  For Japonica rice and I ndica rice , the endnote  
states that these products were net -export products in the 1996 -1998 base period, and that 
therefore, their external reference prices were determined by the f.o.b. prices, on the basis of China's 
Customs statistics. Endnote 18 also clarifies the exchange rates used in the calculations.  
                                                
374 China's first written submission, para s. 221 (referring to United States' first written submission, 
paras.  113-116) and 269; response to Panel question No. 85.  
375 China's first written submission, para s. 221 (referring to United States' first written submission, 
paras.  113-116) and 269; response to Panel question No. 85.  
376 WT/ACC/CHN/38/Rev.3, Supporting Table DS: 5, (Exhibit USA -43). WT/DS511/ R 
 
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  7.190.   Endnote  17 refer to Appendices DS 5 -3 and DS 5 -4. These , in turn, contain further data on 
the c.i.f. and f.o.b. prices for the mentioned products. Appendix DS 5 -3 contains c.i.f. Prices for 
wheat and provides as follows:  
Table 4 : Appendix DS 5 -3 (reproduced from WT/ACC/CHN/38/Rev.3 ) 
HS Code  Calendar Year  Import Volume  
(tons)  Import Value  
(US $)  c.i.f. Price 
(US $/ton)  c.i.f. Price 1/  
(RMB 
yuan/ton)  
10011000  
Wheat  1996 4512381  1023059000  226.7  1885.0  
1997 1508909  296653000  196.6  1629.6  
1998 1275384  243373000  190.8  1579.8  
Average of 
1996-98   204.7  1698.1  
 
7.191.   Appendix DS 5 -4 contains f.o.b. Prices for  Japonica rice and Indica rice:  
Table 5 : Appendix DS 5 -4 (reproduced from WT/ACC/CHN/38/Rev.3 ) 
HS Code  Calendar Year  Export Volume  
(tons)  Export Value  
(US $)  f.o.b. Price 
(US $/ton)  f.o.b. Price 
3/ 
(RMB 
yuan/ton)  
10063000  
Japonica  
Rice 1/ 1996 85933.49  38066000  443.0  3682.9  
1997 184650.79  63758000  345.3  2862.1  
1998 140340.03  56395000  401.9  3326.9  
Average of 
1996-98   396.7  3290.6  
10063000  
Indica  Rice 
2/ 1996 27479.28  10187000  370.7  3082.1  
1997 569058.74  139571000  245.4  2033.0  
1998 2761298.49  638352000  231.2  1913.9  
Average of 
1996-98   282.4  2343.0  
 
7.192.   From the above, we note that none of the different "external reference prices" mentioned or 
used in China's tables of supporting material  are based on the years 1986 -1988,  referred to in 
Paragraph 9 of Annex  3, but rather are based on the years 1996 -1998. This is consistent with China's 
characterization of its tables of supporting material.  
7.193.   Our above assessment of China's tables of supporting material needs to be nuanced to 
recognize two important differences: (i) the  difference  between the base period  and the FERP itself , 
and (ii) the fact that China's tables of supporting material refer to an "external reference price" and 
not to a  fixed external reference price.  
7.194.    Regarding the first difference, the United States argues that a "base period " describes the 
period of time for which an acceding or negotiating Member provides information as to its form and 
level of domestic su pport to ag ricultural producers, and that "b ase period " is distinct from the "fixed 
external reference price, " which is one component of the calculation for market price support as set 
out in Annex 3. For the United States, t he period relevant to the FERP is specific ally defined in 
Paragraph 9  of Annex 3, which provides that this value "shall be based on the years 1986 to 1988 "; 
the language of this provision  is mandatory and does not permit deviations.  In this vein, the United 
States maintains that the fact that Urug uay Round Members ' typical base period coincided with the 
period used for the FERP does not alter this assessment.377 
7.195.   The United States also claims that g iven that no explicit requirement exists with regard to 
the base period in the context of domestic support, acceding Members can utilize a "base period " 
                                                
377 United States' response to Panel question No. 89; United States' comments on China's response to 
Panel question No. 89.  WT/DS511/ R 
 
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  other than 1986 to 1988 when they provide domestic support info rmation as recorded in 
Articles  1(a)(i) and 1(h)(i). For the United States, there is similarly no reason to reference the chosen 
base period in an acceding Member 's Working Party Report or Accession Protocol, as this choice 
would not represent a departure from WTO obligations.  The United States also recognizes that i n its 
tables of supporting material , China used a base period for purposes o f domestic support of 1996 -
1998, and that  China also used external reference prices based on those years . According to the  
United States, there is  no legal ba sis to find that these years are appropriate for use in the calculation 
of China 's product -specific AMS.378  
7.196.   China does not believe that there is, or can be, a difference between  the three -year period 
used for the FERP in the calculation of Base Total  AMS an d the three -year period that should be used 
for the FERP when calculating Current Total AMS . For China, the United States' position is flawed 
because it is based on an isolated reading of the terms of Paragraph 9 of Annex 3 of the Agreement 
on Agriculture  and it ignores the other relevant terms of the treaty, including Articles 1(a)(ii), 1(h)(ii) 
and Rev.3, their context, along with any subsequent practice, and the object and purpose of the 
Agreement on Agriculture . China argues that the use of different  base periods for the calculation of 
Base Total AMS and Current Total AMS would result in a n "apples -to-oranges " comparison , which 
would mean that  domestic support measures ' compliance with a Member 's reduction commitments 
could  be a function of changes in  input data and methodologies used in the calculation of AMS , 
including in the base period for the FERP, rather than a reflection of the domestic support measures 
applied .379  
7.197.   We agree with the United States that the concept of a b ase period can be  distinct from the  
FERP. However, this does not mean that the two bear no connection with each other. In its simplest 
form, the FERP is a price of a given product that is used as an input in the MPS Formula. In particular, 
it is used to generate a price differential  that is then multiplied by the QEP in order to obtain a 
measurement of domestic support in the form of market price support. As prices for the same 
product may change throughout the years, it is normal that price -related variables, like the FERP, 
are link ed to a certain time -period, i.e. to a base period in the case of the FERP. Therefore, the base 
period  of the FERP is nothing more than the time period for measuring the prices of a given product 
and is one of the characteristics of the FERP used in the ca lculation of market price support.  
7.198.   We also agree with the United States that Paragraph 9 of Annex 3 sets out the relevant base 
period for the FERP that is to be used in the calculation of Current Total AMS. However, our inquiry 
should not stop here as this provision by itself does not address or explain why China's tables of 
supporting material did not base their FERPs on the 1986 -1988 period. Most importantly, this 
provision does not address the question of whether the Panel should attach any legal con sequences 
to the fact that China's tables of supporting material use a FERP that is not based on the years 
provided for in Paragraph 9 of Annex 3, but on a different base period. The United States suggests 
that this difference in the base periods is to be expected as there are no rules to calculate the Base 
Total AMS. According to this position, Paragraph 9 of Annex 3 would only be applicable to the 
calculation of Current Total AMS and not to the Base Total AMS.  
7.199.   The above discussion inevitably leads to the question of whether there should be any 
consistency, as argued by China, between the FERP used in the calculation of Base Total AMS in 
Member's tables of supporting material, and the Current Total AMS. This will be explored in Section 
7.4.5.2.3 below . For the purposes of this Section, it is sufficient for us to say that the main difference 
between the FERP contained in China's tables of supporting material and the one set out in Paragraph  
9 of Annex 3 is the different base period.380 
7.200.    Regarding the second  issue, we recall that the United States argues that China's calculation 
of its Base Total AMS was not  based on a fixed external reference price or the values drawn from 
Appendix DS 5 -3 or Appendix DS 5 -4 of its tables of supporting material. The United St ates claims 
that the fifth column of supporting table DS 5 is labelled "external reference price " and not "fixed" 
                                                
378 United States' response to Panel question No. 89.  
379 China's response to Panel question No. 89.  
380 The United States has argued that there is another difference relating to whether the prices are a 
result of a three-year average. We will address this below.  
 WT/DS511/ R 
 
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  external reference price; and the values contained in that column reflect three different prices, one 
for each year.381  
7.201.   We see two dimensions t o the United States' argument: one relating to the difference in the 
terminology between a "fixed " external reference price and an "external reference price" and another 
one relating to the characteristics of the prices  contained in China's tables of suppo rting material, 
and in particular, to the ones used in the calculations of its Base Total AMS.  
7.202.   Regarding the first dimension, we fail to see how the difference in the terminology could 
have any bearing on the substance of the FERP. In this connection, we agree with China that where 
the data reflects external reference prices that are fixed or anchored in a particular time -frame and 
are used for the calculation of market price support, it is immaterial whether the label "reference 
price" or "external refere nce price " or "fixed external reference price " is used to describe the element 
of the AMS calculation for market price support that Paragraphs 8 and 9 of Annex 3 identify as the 
"fixed external reference price ".382  
7.203.   As to the second dimension, we note that China's tables of supporting material  contain two 
sets of external reference prices  that inform the AMS from market price support calculations set out 
therein: the ones reflected in China's Supporting Table DS:5, which do not appear to contain an 
average of  the period 1996 -1998 but rather yearly prices for each of the already mentioned products, 
and the ones contained in Appendices DS 5 -3 and DS 5 -4, which do contain an average of the period 
1996-1998. In this regard, we agree with the United States that the  "external reference prices" set 
out in China's Supporting Table DS:5 are not the result of an average of the years 1996 -1998, but 
rather yearly prices for each of those years. However, Appendices DS 5 -3 and DS 5 -4 do contain 
"external reference prices" th at use an average for that period and that also comport with the f.o.b. 
or c.i.f. rules set out in Paragraph  9 of Annex 3.  
7.204.   For these reasons, we observe that China's tables of supporting material do contain a three -
year average of the "external reference p rices" that follow the same guidelines set out in Paragraph  
9 of Annex 3 but for the 1996-1998 time-period. Indeed, Appendix DS 5 -3 and Appendix DS 5 -4, 
which expand on the information of the "external reference price" used in table DS :5, contain the 
mentioned data. For these reasons, we conclude that China's tables of supporting material contain 
the necessary information to source a FERP based on an average of the period 1996 -1998.  
7.4.5.2.2   Other Members' tables of supporting material   
7.205.   We now mo ve to assess China's contention that when calculating their Base Total AMS, all 
of the non-original Members have used base periods other than 1986 -1988 for the purposes of 
Supporting Table DS:5.383 
7.206.   In this regard, China presented a table which purported to p rovide  information on the 
benchmark period used in calculating product -specific AMS from market price support, and the 
accompany ing WTO documents containing this information.384 
7.207.   The United States argues that while 36 newly acceding Members used alternative b ase 
periods, only 10 used alternative FERPs and that t his does not amount to a consistent practice.385 
The United States explains that these Members were Saudi Arabia, Jordan, Croatia, Lithuania, China, 
                                                
381 United States' opening statement at the second meeting of the Panel, paras. 30 -31. We note that the 
United States' argues that to calculate the value of market price support during its base period, China ut ilized 
external reference prices reflecting the annual average f.o.b. or c.i.f. commodity price for 1996, 1997, and 
1998, individually, and that, consequently, China's calculation of its Base Total AMS was not based on a "fixed 
external reference price" or  the average values drawn from Appendix DS 5 -3 or Appendix DS 5 -4 of its 
Supporting Tables. For the United States, instead, China's market price support calculations for wheat, Indica 
rice, Japonica rice, and corn in its DS 5 Supporting Table used three di fferent, annual "external reference 
price[s]" corresponding to each year of the base period, and that China did not establish a single, fixed, 
reference price that it used in calculating market price support for every year. United States' response to Panel  
question No. 74 (second substantive meeting).  
382 China's response to Panel question No. 64 (second substantive meeting).  
383 China's first written submission, para. 175.  
384 China's first written submission, para. 175.  
385 United States' first written submission , fn 120.  
 WT/DS511/ R 
 
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  Chinese Taipei, Viet  Nam, Russia, Lao, and Kazakhstan .386 These Members are listed in bold in Table 
6, below.  
7.208.   The United States further contends that n ine of these Members compared AAPs to annual 
external reference prices for the same year . That is, they did not calculate and apply an average 
external reference price for a time period to compare to the AAP for a given year. The United States 
also notes that o ne acceding Member, Chinese Taipei, used an average external reference price 
based on years other than 1986 -1988 in its Table DS 5. The United States further  notes that Bulgaria 
also maintained market price support at the time of accession, but used an external reference price 
based on the years 1986 to 1988 in its Total AMS calculations.387 For the United States, t his review 
provides yet further evidence that there is neither context in Members ' Schedules, nor a "practice " 
that supports the use of a time period other than that set out in  Paragraph 9 of  Annex 3  for purposes 
of calculating current AMS and Current Total AMS.388 
7.209.   After carefully reviewing the parties'  arguments and evidence and the tables of supporting 
material of non-original Members, the Panel has produced the following table summarizing its factual 
findings : 
Table 6 : Factual findings on non -original Members  
Acceded 
Member  (in 
alphabetical 
order ) Date of 
accession  Base 
period 
used389 Supporting 
document  Notes  
Afghanistan  29 July 2016  2009-2011 WT/ACC/SPEC/AF
G/2   
Albania  8 September 
2000 1996-1998 WT/ACC/SPEC/AL
B/4/Rev.4   
Armenia  5 February 2003  1995-1997 WT/ACC/SPEC/AR
M/4/Rev.2   
Bulgaria  1 December 1996  1986-1988 G/AG/AGST/Vol.5  Uses data from the years 1986 -88. 
Although the base period for Bulgaria 
corresponds to that of the Uruguay 
Round, Bulgaria's Working Party Report 
notes that "an earlier period than the 
most recent three year period was 
accepted by WTO Members only because 
the latter was not regarded as 
representative due to the United Nations 
embargo applied to the former Republic of 
Yugoslavia". See WT/ACC/BGR/5 , p. 23 . 
Includes MPS for the base period.  
Cambodia  13 October 2004  1998-2000 WT/ACC/SPEC/KH
M/3/Rev.2   
Cape Verde  23 July 2008  2003-2005 WT/ACC/SPEC/CP
V/1/Rev.4   
China  11 December 
2001 1996-1998 WT/ACC/CHN/38/
Rev.3  Includes MPS for the base period.  
Croatia  30 November 
2000 1996-1998 WT/ACC/SPEC/HR
V/1/Rev.3  Croatia uses a special methodology for 
calculation of domestic support, as the 
Danube Region had been occupied during 
1996-1997, and thus data for the whole of 
Croatia was not available until 1998.  
 
Ecuador  21 January 1996  N/A G/AG/AGST/ECU  Ecuador reports that it was not using 
domestic support subject to reduction 
commitments and thus no years are 
specified.  
Estonia  13 November 
1999 1995-1997 WT/ACC/SPEC/ES
T/4   
                                                
386 United States' response to Panel question No. 90.  
387 United States' response to Panel question No. 90 (referring to Bulgaria's Supporting Table, 
G/AG/AGST/Vol.5, p. 7).  
388 United States' response to Panel question No. 90.  
389 This column describes the time -period used by Members to report information relative to agricultural 
subsidies. It is not limited to market price support measures.  WT/DS511/ R 
 
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  Acceded 
Member  (in 
alphabetical 
order ) Date of 
accession  Base 
period 
used389 Supporting 
document  Notes  
Georgia  14 June 2000  1996-1998 WT/ACC/SPEC/GE
O/2/Rev.1   
Jordan  11 April 2000  1994-1996 WT/ACC/SPEC/JO
R/2/Rev.3  Includes MPS for the base period.  
Kazakhstan  30 November 
2015 2010-2012 WT/ACC/SPEC/KA
Z/6/Rev.14  Includes MPS for the base period.  
Kyrgyz 
Republic  20 December 
1998 1994-1996 G/AG/AGST/KGZ   
Lao 2 February 2013  2001-2003 WT/ACC/SPEC/LA
O/1/Rev.1  Includes MPS for the base period.  
Latvia  10 February 1999  1994-1996 WT/ACC/SPEC/LV
A/2   
Liberia  14 July 2016  2011/2012 -
2013/201 4 WT/ACC/SPEC/LB
R/1/Rev.1   
Lithuania  31 May 2001  1995-1997 WT/ACC/SPEC/LT
U/7/Rev.3  Lithuania notes that data from the year 
1998 is included for "for information only". 
1998 is not listed in the reporting period.  
Includes MPS for the base period (and for 
1998 "only for information").  
Macedonia  4 April 2003  1998-2000 WT/ACC/SPEC/80
7/5/Rev.2  Includes MPS for the base period.  
Moldova  26 July 2001  1996-1998 WT/ACC/SPEC/M
OL/1/Rev.8   
Mongolia  29 January 1997  N/A G/AG/AGST/MNG  Only " de minimis " is listed under the 
heading "domestic support". No years are 
listed.  
 
Montenegro  29 April 2012  2005-2007 WT/ACC/SPEC/CG
R/1/Rev.2   
Nepal  23 April 2004  1995/ 1996-
1997/ 1998 WT/ACC/SPEC/NP
L/2/Rev.1  Though Nepal  has no market price 
support measures, it specifies the 
"External reference price" as 
corresponding to "(Average 1996 -1998)" 
in Table DS:5.  
 
Oman  9 November 2000  1994-1996 WT/ACC/SPEC/O
MN/2/Rev.2   
Panama  6 September 
1997 1991-1993 G/AG/AGST/PAN   
Russia  22 August 2012  2006-2008 WT/ACC/SPEC/RU
S/39  Includes MPS for 2008 only (using average 
export prices for the period of 2006 -2008).  
Samoa  10 May 2012  2005/2006 -
2008/200 9 
and  
2002/2003 -
2007/2008 
for DS:4  WT/ACC/SPEC/SA
M/3/Rev.4  Samoa's reporting period ranges from 
"2005/2006 -2008/2009", (a 4 year 
period ); in its tables of supporting 
material, DS4 which summarizes the 
calculation of Total AMS, Samoa reported 
that it "had no product -specific measures 
in the reference period" for 20 02/2003 -
2007/2008 (a 6 -year period).  
Saudi Arabia  11 December 
2005 2001-2003 WT/ACC/SPEC/SA
U/1/Rev.10  Includes MPS for the base period.  
Seychelles  26 April 2015  2010-2012 WT/ACC/SPEC/SY
C/4/Rev.2   
Chinese 
Taipei  1 January 2002  1990-1992  WT/ACC/SPEC/TP
KM/4/Rev.3  An apparent deviation from the most 
recent three -year period principle was 
agreed for Chinese Taipei (1990 -1992). 
However, Chinese Taipei also agreed to 
reduce its Total AMS commitments over 
the period 1995 -2000, i.e. prior to 
accession. Thus, the final bound 
commitment level (year 2000) is 20 per 
cent less than the Base Total AMS (1990 -
1992) for Chinese Taipei. See 
WT/ACC/10/Rev.4.  
Includes MPS for the base period  (i.e. 
1990-1992) WT/DS511/ R 
 
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  Acceded 
Member  (in 
alphabetical 
order ) Date of 
accession  Base 
period 
used389 Supporting 
document  Notes  
Tajikistan  2 March 2015  2008-2010 WT/ACC/SPEC/ TJ
K/3/Rev.5   
Tonga  27 July 2007  1996/1997 -
1998/199 9 WT/ACC/SPEC/TO
N/3/Rev.3   
Ukraine  16 May 2008  2004-2006 WT/ACC/SPEC/UK
R/1/Rev.12  Includes MPS for the base period.  
Vanuatu  24 August 2012  2006-2008 WT/ACC/SPEC/VU
T/6/Rev.3  Uses the term "representative period".  
Viet Nam 11 January 2007  1999-2001 WT/ACC/SPEC/VN
M/3/Rev.7  Includes MPS for the base period.  
Yemen  26 June 2014  2006-2008 WT/ACC/SPEC/YE
M/1/Rev.2   
 
7.210.   From the above, we observe that the majority of the 36 non-original Members reported the 
use of domestic support during the years preceding their accession; only four Members390 made a 
reference (direct or indirect ) to the years used in their tables of supporting material as the "base 
period", rather than the "reporting peri od". This stems from  using a standard template to provide 
factual information on the domestic support actually in place in agriculture, upon which all tables of 
supporting material submitted as part of a Member's accession are based.  Finally, a number of 
Members have explicitly linked the years used in their tables of supporting material to the (fixed) 
external reference price ( outside of  Table DS:5 itself).391 Out of these 36 Members, only one 
(Bulgaria) used a period of 1986 -88 (see Table 6 above); Bulgaria 's Working Party Report notes 
nevertheless  that this "earlier period than the most recent three year period was accepted by WTO 
Members only because the latter was not regarded as representative due to the United Nations 
embargo applied to the former Repub lic of Yugoslavia ."392  
7.211.   Following the United States' assertion that "[w]hile 36 newly acceding Members used 
alternative base periods, only 10 used alternative fixed external reference prices ", the Panel asked 
the United States to list each of the 10 Members who had allegedly used alternative FERPs. The 
United States responded by listing 10 Members that maintained MPS measures at the time of their 
accession.393 The implication of its response is that it is only those Members which maintained MPS 
measures at the time of their accession which have used an alternative period for the FERP 
specifically, rather than just a different base period. China's argument in th is regard was that " all of 
the accessions that have taken place since the establishment of the WTO in 1995 have used base 
periods  other than 1986 -88 for the purposes of Supporting Table DS:5 "394 and this is what Table 6 
of its first written submission reflec ts.395 Implicit in that argument is the notion  that the base period 
specified in a Member's tables of supporting material is always to be used in determining the FERP 
should a Member decide to use market price support. The United States' position appears to be that 
there is a fundamental difference between the base period and the years used for determining the 
FERP, where one does not necessarily directly correspond to the other.  
7.212.   We note that 12 out of the 36 non-original Members reported the use of market pr ice support 
during the base period. All these 12 Members also provided annual "external reference prices" for 
the products benefitting from this support for the very same base period and used them to calculate 
the base period market price support. The base  period averages of the c.i.f. or f.o.b. prices were 
explicitly reported by all but four Members (Jordan, Lao, Lithuania, Ukraine). Among those explicitly 
reporting the average prices, six did so in the Supporting Table DS:5 (Bulgaria, FYROM, Kazakhstan, 
Russia, Saudi Arabia, Viet Nam), and two in an appendix table or in an attachment (China, Chinese 
Taipei). Hence, while the ways of reporting different components of a FERP have varied, all Members 
reporting MPS for their base period provided the necessary data to derive the FERP (c.i.f. or f.o.b. 
prices depending on whether the Member was a net importer or net exporter of the product in 
question during the base period).  
                                                
390 China, Jordan, Lao, Moldova.  
391 China, Croatia, Kazakhstan, Lithuania, Russia, Saudi Arabia, Chinese Taipei, Ukra ine. 
392 Bulgaria's working party report,  WT/ACC/BGR/5,  p. 23.  
393 United States' response to Panel question No. 90.  
394 China's first written submission, para. 175. (emphasis added)  
395 China's first written submission, Table 6.  WT/DS511/ R 
 
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  7.213.   As discussed in paragraph 7.197 above , the Panel does not consider the United States' 
position that the FERP is entirely divorced from the concept of the base period to be accurate. It is 
clear, and the United States accepts, that where a Member d id maintain MPS during its accession, 
the years used as a base period were the years also used in determining the FERP for the calculation 
of the base period MPS. Regardless, the fact remains that , with the exception of Bulgaria, Ecuador 
and Mongolia ( see Table 6 above) , each acceding Member  has explicitly used a base period other 
than 1986-1988, and where those Members maintained MPS measures, the FERP was based on 
those same years. In other words, the base period in Paragraph 9 of Annex 3 has not been use d to 
calculate the FERPs reflected in those Members' tables of supporting material.  
7.214.   For the foregoing  reasons , we conclude that none of the 36 Members that have acceded to 
the WTO since 1995 used a base period of 1986 -1988 with the exception of Bulgaria for which "the 
most recent three year  period" was not regarded as representative by WTO Members due to the 
United Nations embargo applied to the former Republic of Yugoslavia. This fact provides important 
context in which to interpret China's Schedule, which must be kept in mind throughout the Panel's 
analysis of the FERP and the appropriate period to use in this case (discussed in detail in Section 
7.4.5.2.4  below).  
7.4.5.2.3   Consistency in the calculations of Base Total AMS and Current Total AMS  
7.215.   In this section, we will address China's assertion that there must be consistency in the way 
Base Total AMS and Current Total AMS a re calculated.   
7.216.   We will structure our analysis in three parts: we will begin by addressing China's contention 
that a requirement of consistency stems from the provisions of the Agreement on Agriculture. We 
will then assess China's argument that the existen ce of this requirement is further supported by the 
goal of achieving reduction commitments under the Agreement on Agriculture. We will lastly address 
China's arguments regarding the object and purpose of the Agreement on Agriculture and the 
consistency req uirement.  
7.217.   China first submits the United States fails to recognize that Articles 1(a) and 1(h) of the 
Agreement on Agriculture  require that Base Total AMS and Current Total  AMS be calculated including 
by reference to the same  Member -specific CDM. In partic ular, China argues that  subparagraph (i) of 
each provision refers to a Member 's CDM for the calculation of Base AMS (Article 1(a)(i)) and Base 
Total AMS (Article 1(h)(i)) during the base period  and that s ubparagraph (ii) of each provision then 
refers to th e same  CDM for calculating current AMS (Article 1(a)(ii))  and Current Total AMS 
(Article  1(h)(ii)) during any subsequent year . For China, the same  CDM, including the same  FERPs 
and the same methodology for determining eligible production , must be used to calculate both Base 
Total AMS and Current  Total AMS.396 
7.218.   The United States contends that the Base Total AMS  is an historical reflection of the 
Member 's provision of domestic support at the time of  the Uruguay Round or accession and notes 
that for the purpose  of domestic support commitments neither the Agreement on Agriculture  nor 
the Marrakesh Agreement defines the "base period " for Ur uguay Round or acceding Members.397 The 
United States also claims that  both Articles 1(a) and 1(h ) assign  a spe cific degree of consideration 
to the text of the Agreement and a Member 's CDM. The United States argues that Article 1(a) 
provides in subparagraph  (i) that "with respect to support provided during the base period, " AMS is 
"specified in the relevant tables of supporting material  incorporated by reference in  Part IV of a 
Member's Schedule" and that t his indicates where  country -specific reference information regarding 
the annual level of support in favour of basic agricultural producers in the base period may be found 
but it does not prescribe a calculation methodology for either the "base period " or for later years .398  
                                                
396 China's second written submissio n, para. 298.  
397 United States' response to Panel question No. 71 (first substantive meeting).  
398 United States' response to Panel question No. 79. Regarding Article 1(h), the United States argues 
that this provision provides a similar formulation in that su bparagraph (i) states that Base Total AMS is the 
sum of all "support provided during the base period" and that subparagraph (ii) further specifies where 
information may be found and this language does not propose a particular calculation methodology for ei ther 
the base period or for a subsequent period. The United States also argues that in both Article 1(a) and 1(h), 
subparagraph (i) is juxtaposed with subparagraph (ii) which provides specific directions for calculating the 
 WT/DS511/ R 
 
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  7.219.   According to China,  the consistency requirement is enshrined  in Article 1 of the Agreement 
on Agriculture. For China, this is so because Articles 1(a) and 1(h) allegedly refer to the same CDM 
when setting out how the Base total AMS and the Current Total AMS are to be calculated. As a 
consequence, use of the same CDM  in the calculation of both measurements of domestic support 
brings about the consistency requirement.  
7.220.   Article 1(a)(i)  does not mention how to calculate  the base AMS nor does it  draw any 
connection  to the CDM. It merely refers to : "… support provided duri ng the base period specified  in 
the relevant tables of supporting material incorporated by reference in Part  IV of a Member's 
Schedule"  (emphasis added) .399 The provision does not  refer to the CDM, but only to the tables of 
supporting material. Similarly, Article 1(h)(i) makes no reference to the CDM but only to Part IV of 
a Member's Schedule. In particular, it refers to the Base Total AMS that is " specified in Part IV of a 
Member's Schedule" .  
7.221.   We th us agree with the United States that Article 1 of the Agreement on Agriculture does 
not set out any rules or  calculation methodology for either the "base period " or for later years.400 As 
such, Article 1 only indicates that the Base Total AMS  is specified  in the tables of supporting material 
but does not provid e for how this Base Total AMS  was meant to be calculated there. Indeed, the 
Appellate Body has already arrived at the same conclusion.401 Since this provision does not establish 
any calculation methodology for the Base Total AMS , we fail to see how it can, b y itself, enshrine a 
consistency requirement as China claims .  
7.222.   We, however, disagree with the United States' argument that the Agreement on Agriculture 
sets out no rules or guidance to calculate Base Total AMS.402 In our view, as we will explain below, 
there  are other provisions relevant  in this matter.  
7.223.   In this connection, we note Paragraph 5 of Annex 3 of the Agreement on Agriculture, which 
provides as follows : 
The AMS calculated as outlined below for the base period  shall constitute 
the base level  for the implementation of the reduction commitment on 
domestic support. (Underline added)  
7.224.   Similarly, Articles 1(a)(i) and 1(h)(i) of the Agreement on Agriculture  provide respectively 
as follows:  
                                                
respective components of the dom estic support analysis "during any year of the implementation period and 
thereafter." The United States thus submits that contrary to China's suggestion, Articles 1(a) and 1(h) do not 
require that Base Total AMS and Current Total AMS be calculated includin g by reference to the same Member -
specific constituent data and methodology, but rather, that the text of the Agreement on Agriculture provides 
that CDM characteristic of that Member as "used" by the Member in the calculation of Base Total AMS should 
be taken into account or considered when calculating current product -specific AMS or Current Total AMS.  
399 Agreement on Agriculture, Article 1(a)(i).  
400 United States' response to Panel question No. 79.  
401 "However, with respect to the other side of a hypothetical equation, the relevant treaty provisions do 
not provide for any particular mode of calculation of the 'Base Total AMS', from which figure the commitment 
levels for particular years of the implement ation period are arithmetically derived. Article 1(a)(i) of the 
Agreement on Agriculture  dealing with AMS states that 'with respect to support provided during the base 
period', a treaty interpreter needs only to go to 'the relevant tables of supporting mat erial incorporated by 
reference in Part IV of a Member's Schedule  … '. (emphasis added) Similarly, Article 1(h)(i) dealing with Total 
AMS, states that 'with respect to support provided during the base period (i.e., the 'Base Total AMS') and the 
maximum sup port permitted to be provided during any year of the implementation period or thereafter (i.e., 
the 'Annual and Final Bound Commitment Levels')', a treaty interpreter needs only to go to what is ' specified in 
Part IV of a Member's Schedule  … '. (emphasis a dded) Thus, for purposes of determining whether a Member 
has exceeded its commitment levels, Base Total AMS, and the commitment levels resulting or derived 
therefrom, are not themselves formulae to be worked out, but simply absolute figures set out in the Schedule 
of the Member concerned. As a result, Current Total AMS which is calculated according to Annex 3, is 
compared to the commitment level for a given year that is already specified as a given, absolute, figure in the 
Member's Schedule." Appellate Body  Report, Korea – Various Measures on Beef , para. 115.  
402 United States' response to Panel question No. 79.  
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  [W]ith respect to support provided during the base period , specified in the relevant 
tables of supporting material incorporated by reference in Part  IV of a Member's 
Schedule… ( emphasis  added)  
[W]ith respect to support provided during the base period  (i.e. the "Base Total AMS")… 
(emphasis  added)  
7.225.   We asked the parties whether  the term "base period" in the cited provisions is referring to 
the same measurement of domestic support, i.e. Base Total AMS, or i f not, to what other  
measurement of domestic support and  "base period" each  of these provisions would be referring.  
7.226.   The Unite d States recognizes that indeed, these provisions are referring to the same 
measurement of domestic support. The United States argues  that the "' base period' referred to in 
Articles 1(a) and 1(h), as well as Annex 3, Paragraph 5, is likely the same or simi lar base period 
used by a Member to disclose the types of support provided and calculate the value of support in 
their tables of supporting material.403 However, the United States submits that as indicated in the 
text of those provisions, this is an historic al value set out in a Member's supporting material or 
Schedule.404 The United States also argues that P aragraph 5 of Annex 3  refers to the base level for 
implement ation of "reduction commitments", but that  China did not make any reduction 
commitments in its Schedule or Accession Protocol, and therefore Paragraph 5 would not appear to 
have applied to China at any point. For the United States,  Paragraph 5 does not contain any ongoing 
commitment regarding the calculation of the level of domestic support during t he base period, and 
even where an acceding Member should have calculated its Base Total AMS consistent with Annex 
3, failure to comply with this requirement is of no consequence during subsequent years.405 
7.227.   In short, the United States argues that the commitme nts to maintain levels of "domestic 
support in favour of agricultural producers expressed in terms of Current Total AMS … "406 and to 
calculate product -specific AMS and Current Total AMS "in accordance with " the Agreement  on 
Agriculture , including Annex 3 and  Article 6407, apply whether or not the Base Total AMS "contained 
errors or was calculated inconsistently with Annex 3 ".408 
7.228.   China claims that this provision explains that Annex 3 also serve s as a framework for the 
calculation of Base AMS in a Member's Supporti ng Tables, and that a s a result, a Member 's Base 
AMS, as calculated in a Member's tables of supporting material, will generally reflect the framework 
set out in Annex 3.409 For China, Paragraphs 5 -13 of Annex 3 explicitly provide guidance in the form 
of a fr amework for a Member to calculate its Base Total AMS and they provide the same guidance 
for purposes of calculating Current Total AMS.410  
7.229.   In the Panel's view , the text of Paragraph 5 indicates that t he AMS calculated as outlined in 
Paragraphs 5 -13 of Annex 3 for the base period, th at is, the Base  Total AMS, shall constitute the 
base level for the implementation of the reduction commitment on domestic support.  This rebuts 
the United States' argument that nothing in the Agreement on Agriculture provides guidan ce for the 
calculation of the Base Total AMS. Importantly, Paragraphs 6 -13 of Annex 3 provide the same 
guidance for calculating Current Total AMS. This indicates that the methodologies for the calculation 
of both types of measurements are similar, supporti ng China's argument of consistency.  
                                                
403 United States' response to Panel question No. 102.  
404 United States' response to Panel question No. 102.  
405 United States' response to Panel question No. 102.  
406 United States' response to Panel question No. 102 (referring to Agreement on Agriculture, 
Article  6.3). 
407 United States' response to Panel question No. 102 (referring to Agreement on Agriculture, 
Articles  1(a)(ii) and 1(h)(ii)).  
408 United States'  response to Panel question No. 102.  
409 China's comments on the United States' response to Panel question No. 62 (second substantive 
meeting).  
410 China's comments on the United States' response to Panel question No. 62 (second substantive 
meeting).  
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  7.230.    We therefore  agree with China that the calculation of Base Total AMS does not occur in a 
legal vacuum411, absent any guiding rules, but that the text of the Agreement on Agriculture contains 
provisions pertaining to this calculation.  
7.231.   We are nonetheless mindful that concluding the above does not automatically confirm the 
existence of a consistency requirement in the Agreement on Agriculture. Indeed, the calculation of 
the Base Total AMS is part of a negotiating process amo ng Members and the acceding candidate. 
For this reason, even if Paragraphs 5 to 13 seem to equally apply to the calculations of both the 
Base Total and the Current Total AMS, there might be  a difference arising from the negotiation 
process resulting in a d ifference in the  methodologies for  these measurements of domestic support. 
What c an be concluded from the above is that the similar ways in which these measurements are 
meant to be calculated pursuant  to the Agreement on Agriculture lends strong support to the idea 
that there should be some broad correspondence in methodology used in both calculation processes.  
7.232.   We note that the United States argues that P aragraph 5 of Annex 3  refers to the base level 
for implement ation of "reduction commitments", and that  China did not make any reduction 
commitments in its Schedule or Accession Protocol.412 We understand this argument to imply that 
even if this provision sets out rules on how to calculate the Base Total AMS,  it would not apply to 
China as it did not undertake any reduction commitments. As this argument directly relates to 
China's second contention, we will examine its merits below when addressing China's second 
argument.  
7.233.   In conclusion, we find that while Arti cle 1 does not contain guidance on how to calculate  the 
Base Total AMS, Paragraph 5 of Annex 3 does set out important rules in this regard. Importantly, 
Paragraphs 6 -13 of Annex 3 are also applicable to the calculation of the Current Total AMS. This 
implie s that as per the Agreement on Agriculture, the calculation processes of both the Base Total 
and current AMS are similar. This similarity gives strong support to the notion that there must be 
consistency in the way these measurements of domestic support ar e calculated . Importantly, we are 
of the view that failing to recognize that the Agreement on Agriculture provides for a similar 
calculation process for both types of measurements might end up in a comparison between apples 
and oranges , as China suggests .  
7.234.   We now assess China's second argument.  
7.235.   China submits that the United States negates the need for consistency in the CDM used for 
the calculation of Base Total AMS, and the CDM that needs to be used for the calculation of Current 
Total AMS, by referring to  the calculation of Base Total AMS as being of historical interest only.413 
However, China argues, the goal of achieving "reductions"414 of domestic support under the domestic 
support commitments requires consistency  in the calculation of Base Total and Curren t Total AMS 
because if the data and methodology for the calculation of Current Total AMS differed from those for 
Base Total AMS, a reduction of domestic support may not flow from reduced support, but from 
variations in the CDM used for the calculations. Ch ina thus submits that both are necessarily and 
inextricably linked, if AMS calculations are not "destined to become meaningless apples -to-oranges 
comparisons that reveal nothing about actual reductions in domestic support".415 
7.236.    The United States argues that in determining whether the Member has complied with its 
reduction commitments, application of the same methodology to the same program me as was 
calculated during the base period would be appropriate, as the Member 's reduction commitments 
were directly tied  to the level of support provided during the base period. The United States submits , 
however,  that the same cannot be said for the calculation of Current Total AMS where no reduction 
commitments we re made or continue to operate . The United States further holds that  the 
methodologies used to calculate a program me during the base period would not  be deferred to by a 
panel where calculation of the Current Total AMS does not involve the sam e program mes, as is the 
                                                
411 China's  comments on the United States' response to Panel question No. 62 (second substantive 
meeting).  
412 United States' response to Panel question No. 102.  
413 China's second written submission, para. 300 (referring to United States' response to Panel question 
No. 71 (first substantive meeting), paras. 184 -188).  
414 China's second written submission, para. 301 . 
415 China's second written submission, para. 301.  
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  case in the present dispute.416 The United States  also claims that China has no reduction 
commitments and has an ongoing Final Bound Commitment Level of nil.417 
7.237.   At the centre of China's argument and the United States' rebuttal is the concept of domestic 
support reduction commitment s and whether China has indeed undertaken such reduction 
commitments . The United States does not negate the appropriateness of ensuring consistency for 
assessing compliance with reduction commitments. It, however, maintains that China has no 
reduction commi tments but rather an ongoing Final Bound Commitment Level of nil.418 It thus follows 
that the legal issue before the Panel relates to the nature of China's commitment s and whether an 
assessment of its compliance will require calculating the Current Total AMS  consistently with how 
the Base Total AMS was originally calculated.  
7.238.   Underlying the United States' argument is the notion that the Agreement on Agriculture 
distinguishes between domestic support reduction commitments, whereby a Member is required to 
reduce  its (non -zero) AMS commitment (starting from the base level) to a final bound total AMS 
level at the end of the implementation period, and domestic support commitments that from the 
beginning are set to nil (like in the case of China) and therefore have n o reduction implementation 
period. We agree with the United States that conceptually there is a difference between a 
commitment that binds a Member to progressively reduce domestic support until it reaches a certain 
level, and a commitment that binds a Mem ber to limit domestic support to a nil level where a 
reduction period is not needed. However, we fail to see any express support for this alleged 
difference in the types of domestic support commitments in the Agreement on Agriculture.  
7.239.    Article 6.1, which is titled "Domestic Support Commitments", provides that the "domestic 
support reduction commitments" of each Member contained in Part IV of its Schedule shall apply to 
all of its domestic support measures (with the exception of domestic measures which are not subject 
to reduction and in Annex 2 to the Agreement on Agriculture) and that the commitments are 
expressed in terms of Total Aggregate Measurement of Support and "Annual and Final Bound 
Commitment Levels". Similarly, Article 6.3 establishes that a Mem ber shall be considered to be in 
compliance with its "domestic support reduction commitments" in any year in which its domestic 
support in favour of agricultural producers expressed in terms of Current Total AMS does not exceed 
the corresponding "annual or  final bound commitment level specified in Part IV of the Member's 
Schedule". We note that the above provision speaks only of one kind of commitment and does not 
give any basis to argue that there are different types of commitments, as the United States se ems 
to suggest.  
7.240.    The above provision s do not suggest that a domestic support commitment that from the 
beginning is set at nil with no reduction period, such as China's , and a commitment that require s a 
Member to progressively reduce support  to a fixed leve l (which may also be a fixed level of nil) are 
legally different. Indeed, we note that after the end of the implementation period, there would not 
be any difference between these two alleged types of commitments except for the level itself, which 
would have been a result of the negotiation process among Members. This strongly weighs against 
the United States' proposition.  
7.241.   We also agree with China that the United States' argument seems to be at odds with its 
general position in this dispute.419 If we were to  agree with the United States that China's 
commitment is not a domestic support reduction commitment420, then it would be difficult to sustain  
the proposition  that the domestic support disciplines under Article s 3.2 and 6.3 would apply to China, 
resulting in a likely dismissal of the United States' claim under these provisions. This is so because 
Article 6.3 refers to " reduction commitment " and would potentially not cover an ongoing Final Bound 
Commitment Level o f "nil". Following the United States' logic, as China has not undertaken 
"reduction commitments", but an ongoing Final Bound Commitment Level of "nil", these provisions 
would not seem to apply. This result would be in direct opposition to the United States ' general 
claims in this dispute. To us, this indicates that the difference that the United States is drawing is 
supported neither by the text nor the design of the Agreement on Agriculture.  
                                                
416 United States' second written submission, para. 71.  
417 United States' response to Panel question No. 75.  
418 United States' response to Panel question No. 75.  
419 China's comments on the United States' response to Panel question No. 75.  
420 United States' response to Panel question No. 75.  WT/DS511/ R 
 
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  7.242.   For these reasons, we reject the United States' characterization of China's domestic support 
commitments as falling outside the scope of the domestic support commitments that Article 6.1  
refers to. We find that  China has an ongoing domestic support commitment set at the level of nil.  
7.243.   Having found this, and noting that t he United States also agrees with the necessity of 
ensuring some consistency in the calculations, we agree with China that the assessment of whether 
a Member has complied with its reduction commitments seems to presuppose that the Current Total 
AMS is calc ulated consistently with the manner in which the Base Total AMS was calculated. This is 
so because Base and Current Total AMS are meant to provide a measurement of the actual domestic 
support that Members are granting . If no consistency was kept in this pr ocess, any differences 
between the Base and Current Total AMS when assessing a Member's compliance with its domestic 
support commitments could be the result of differences in the methodology applied to construct the 
AMS values and not of the actual domesti c support measures applied by a Member. This could lead 
to a situation where the resulting differences in the values are a result of the dissimilar mathematical 
process applied, and not in the actual provision of domestic support by Members. This, in turn,  could 
lead to an apples -to-oranges comparison as the AMS values to be compared would be based on 
different calculation  processes .421 To us, the above runs contrary to the object and purpose of the 
Agreement on Agriculture of ensuring substantial progressive  reductions in agricultural support and 
protection.422 
7.244.   In this connection, we note that the panel in Korea – Various Measures on Beef  opined that 
"[i]n the calculations o f product specific support the ' constituent d ata and methodology'  has an 
important role to play in ensuring that the calculation of support to any given product is calculated 
in subsequent years consistently with support calculated in the base period ".423 We agree with this 
statement and note that the existence of the consistency requirement ca n also be observed in the 
incorporation of the CDM in the definitions of AMS and Current Total AMS in Article 1. The CDM that 
is contained in a Member's supporting table, and that reflects parts of the calculation process of the 
Base Total AMS, is meant to  be used when calculating the Current Total AMS as set out by the 
Agreement on Agriculture. To us, this implies that both measurements of domestic support have 
certain commonalities in the way they are calculated. The CDM thus appears to be  the link betwee n 
the two of them.  
7.245.   The United States acknowledges the panel's statement in  Korea – Various Measures on Beef  
in this regard, but argues that this statement, and those of the Appellate Body in the same dispute, 
do not suggest that the role of constituent da ta and methodology in ensuring consistency could 
supersede the obligations set out in Annex 3.424 
7.246.   In this connection, we observe that the Appellate Body in that dispute does not seem to 
have done other than to note the above -mentioned Panel statement  in a fo otnote .425. However, it 
did make other statements that are relevant to the present dispute and have been used by the 
United States to support its position. In particular, the Appellate Body stated that:  
Thus, for purposes of determining whether a Member has exceeded its commitment 
levels, Base Total AMS, and the commitment levels resulting or derived therefrom, are 
not themselves formulae to be worked out, but simply absolute figures set out in the 
Schedule of the Member concerned. As a result, Current Total AMS which is calculated 
according to Annex 3, is compared to the commitment level for a given year that is 
already specified as a given, absolute, figure in the Member's Schedule.426 
7.247.   China argues that the cited passage supports its view that consistency/parallelism is required 
in the calculation of Base Total AMS, which serves as the basis for domestic support reduction 
commitments, and Current  Total AMS.427 The United States argues that in the cited paragraph,  the 
                                                
421 China's response to Panel question No. 75.  
422 Third recital of the Preamble t o the Agreement on Agriculture.  
423 Panel Report, Korea – Various Measures on Beef , para. 811.  
424 United States' response to Panel question No. 79.  
425 Appellate Body Report, Korea – Various Measures on Beef , fn 49. The Appellate Body did not 
otherwise express concerns with the panel's statement.  
426 Appellate Body Report, Korea – Various Measures on Beef , para. 115.  
427 China's response to Panel question No. 114.  
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  Appellate Body concl uded that the Final Bound Commitment Level is an absolute value to which 
"Current Total AMS … calculated according to Annex 3 , is compared"428 and that n either the 
Agriculture Agreement, nor the findings of the Appellate Body, support the conclusion that Cur rent 
Total AMS is compared to, or must be calculated consistent with, a Member 's Base Total AMS.429 
7.248.   We note that the cited statements have to be considered in the context in which they were 
made. In particular, th ese statement s were a response to Korea's arg ument that national schedules 
on the reduction of subsidies in favour of agricultural products could be understood as multi -year 
equations, where one side of the equation includes the commitment level for a given year, while the 
other side of the equation includes the actual AMS for the same year. The Appellate Body's view was 
that one side of such an equation – the one describing the Base Total AMS - would be an already -
specified figure so that there would not be any formula involved on that side of the eq uation. In 
other words, when determining whether Current Total AMS exceeds China's domestic support 
commitment level, the Base Total AMS is not itself a formula that would need to be solved so as to 
obtain a number; it is a fixed figure that has already be en calculated and specified in the tables of 
supporting material. For these reasons, the Appellate Body rejected Korea's multi -year equation 
approach to evaluating compliance. We note that adopting Korea's approach would have suggested 
that consistency is almost of a mathematical exactness. This is so because a direct equivalence was 
implied by the equ al signs  of Korea's multi -year equations .  
7.249.   The Appellate Body also stated, as mentioned before, that with respect to the side of the 
hypothetical equation rep resenting the Base Total AMS, "the relevant treaty provisions 
do not provide for any particular mode of calculation of the 'Base Total AMS'"430, from which figure 
the commitment levels could be arithmetically derived. We note that the context provided by the  
sentences before and after this statement clarifies that "the relevant treaty provisions" referred 
therein were Articles 1(a) and 1(h) of the Agreement on Agriculture. This is so because the Appellate 
Body was drawing a parallel between the Current Total AMS, whose calculation methodology is set 
out in those provisions, and Base Total AMS, whose calculation methodology is not set out in those 
provisions. There is no indication in that Appellate Body Report that consideration was given to 
Paragraph  5 of Ann ex 3, as we have done above, and which in our view does provide for guidelines 
in this respect. Nor is there any indication that the Appellate Body believed that there was no 
guidance  to calculate the Base Total AMS, when its statements are placed in the p roper context.  
7.250.   For these reasons, we consider that the statements of the Panel in Korea – Various Measures 
on Beef  are relevant to the matter at hand and that the Appellate Body's statements do not oppose 
the Panel's views on how the CDM guarantees some so rt of consistency in the mentioned 
calculations. While the Appellate Body rejected a strict mathematical equivalence approach to the 
consistency requirement, it left open the notion of a general consistency, which does not require an 
exact identity in the calculation methodology.  
7.251.   The above leads us to conclude that both the text of the Agreement on Agriculture and the 
goal of achieving domestic support reduction commitments in this same agreement support the 
notion that there should be a broad correspondenc e in the methodologies used to calculate the Base 
Total AMS and the Current Total AMS. Such consistency is in part safeguarded by the usage of the 
CDM in the calculations. To us, this does not mean that either  the data used or the methodologies 
employed have to be identical in every respect . The actual result will depend on the concrete 
circumstances of the Member involved.  
7.252.   Having found this , we do not deem it necessary to address China's third argument that the 
object and purpose of the Agreement on Agri culture  requires consistency between negotiated  
commitments and an assessment of compliance with these negotiated commitments .431 
7.4.5.2.4   The FERP that should be used in the present dispute  
7.253.   We will now set out our understanding of Paragraph 9 of Annex 3 and define t he FERP that 
should be used to calculate China's Current Total AMS in this dispute. As mentioned in paragraph  
                                                
428 Appellate Body Report, Korea – Various Measures on Beef , para. 115.  
429 United States' comments on Chin a's response to Panel question No. 114.  
430 Appellate Body Report, Korea – Various Measures on Beef , para. 115.  
431 China's second written submission, para. 302.  
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  7.180 above , the Panel is presented with what seems  to be a simple choice: using a FERP based on 
the years 1986 -1988, as the United States asserts, or one based on the years 1996 -1998, as China 
asserts. In this connection, we note that the parties ' disagreement does not pertain to the entirety  
of Paragraph  9 of Annex 3432; it is only the applicability of the 1986 -1988 time -period set out therein 
that is an issue between them.  
7.254.   We note at the outset that the text of Paragraph  9 explicitly refers to the FERP being based 
on the years 1986 to 1988. This language must be read in its proper context and in light of the 
object and purpose of the Agreement on Agriculture. In this connection , we note that this context is 
provided by other elements of the Agreement on Agriculture, together with the covered agreements, 
and the object and purpose of this Agreement as reflected inter alia  in its preamble. In addition, we 
note that the interpretation that we give to Paragraph  9 should take into account that this provision 
is organically connected to other rules in the Agreement on Agriculture that set out the manner in 
which domestic support, in the form of market price support, is meant to be calculated. In other 
words, Parag raph 9 is part of a set of norms that provide for a mathematical framework in order to 
arrive at a measurement of domestic support. Therefore, an interpretation of Paragraph  9 should 
not be done in isolation of the overarching mathematical operation of whi ch it forms a part: the MPS 
formula. For these reasons, we are of the view that any interpretation given to this provision should 
recognize that the FERP is meant to interact with the other two variables of the AMS formula, the 
AAP and the QEP, and should keep some harmony and consistency with the mathematical process 
envisaged by the Agreement on Agriculture.  
7.255.   Of particular importance in this interpretative process are the conclusions that we have 
arrived  at in the previous sections. We recall that we concl uded that China had not use d a FERP 
based on the 1986 -1988 time -period when calculating its Base Total AMS and that China's tables of 
supporting material contained data on a FERP that used a three -year average for the period 1996 -
1998.433 Importantly, we als o came to the conclusion that none of the 36 Members who have acceded 
to the WTO since 1995 used a period of 1986 -88 with the exception of Bulgaria.434 Additionally, we 
considered that both Annex 3 and China's CDM have to be used in the AMS calculation, in s ome way. 
Lastly, we concluded that the Agreement on Agriculture provided the basis for a requirement aimed 
at guaranteeing some broad correspondence in the process of calculating Base Total and Current 
Total AMS.435 In our view, these conclusions should info rm our interpretation of Paragraph  9 and the 
overall functioning of the FERP in the MPS Formula. As we will explain below, this is so because they 
provide valuable context and clarify how the object and purpose of the Agreement on Agriculture 
permeates the  calculation of domestic support in the form of market price support.  
7.256.   Before embarking upon this analysis, however, we will address a preliminary issue presented 
by the parties regarding the framework that should be used to assess the issue of the FERP.  
7.257.   The parties have submitted extensive arguments on how the decision on the relevant time -
period should be made  by assessing the hierarchical relationship between the provisions that support 
each party's position. Under this approach, the applicable time -period to use for the FERP would 
depend on the legal value of the provisions invoked by each party. For the United States, Paragraph 
9 of Annex 3 is the norm with the highest legal value and thus the FERP must strictly conform to all 
the requirements set out th erein, particularly the time -period of 1986 -1988.436 The United States  
has also argued that the plain meaning of this provision reflects a mandatory obligation to use the 
specific years indicated.437 On the other side of the debate, China has argued that Rev.3  and its CDM 
give rise to domestic -support -related commitments and that the elements contained in the latter 
are part and parcel of the domestic support commitments that China has undertaken under its 
Accession Protocol.438 Under this view, the FERP must be based on the years 19 96-1998 as these  
                                                
432 The parties seem to agree in the fact that the FERP should be a three -year average of the f.o.b.  or 
c.i.f. unit value for the basic agricultural product at issue.  
433 See para. 7.204 . 
434 See para. 7.214 . 
435 See para . 7.251. 
436 United States' first written submission, paras. 98 -100. The United States argues here that the 
reference to calculation of the average f.o.b. or c.i.f. unit value of the agricultural p roduct in the period 1986 
through 1988 establishes that the "fixed external reference price" is to be one, unchanging value . 
437 United States' first written submission, paras. 98 -100; United States'  response to Panel question 
No. 74 (second substantive meeting).  
438 China's second written submission, para. 187.  
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  are the ones used in China's tables of supporting material. Although not expressly stating so, China's 
position is implicitly grounded on the primacy of its so -called domestic -support -related commitments 
over Paragraph  9 of Annex 3.439 
7.258.   This hierarchical approach has also been prominent  in the discussion of the relevance of the 
CDM when calculating China's Current Total AMS. As we concluded in Section 7.4.3 above , Annex 3 
and the CDM ha ve to be used in the abovementioned calculations. This is set out in a clear fashion 
in Article 1 of the Agreement on Agriculture. However, the difference in the language in Articles 
1(a)(ii) and 1( h)(ii), particularly the words "taking into account" in the former provision, gave the 
basis for the United States to argue that there is a hierarchy between Annex 3 and the CDM. For the 
United States, this hierarchy implied that a possible conflict between Annex 3 and the CDM should 
be resolved in favour of the former. In this vein, even if it was clear that the CDM had to be used in 
the pr ocess of calculating Current Total AMS, any inconsistencies between the CDM and Paragraph  
9 would have to be resolved in favour of the latter , as the CDM was only meant to be "taken into 
account".  
7.259.   We have expressed our views on  the inadequacy of assessing the differences in the language 
of Article s 1(a)(ii) and 1(h)(ii) through the lens of conflict . This had the potential to distort  the 
general conception of the calculation of Current Total AMS under these provisions as being 
organically and inextricably li nked.440 We also stressed the importance of not assuming ex-ante the 
existence of a conflict without considering the possibility of concurrent application.441  
7.260.   As explained in Section 7.4.3 above , the Panel considers that the wording of Articles  1(a)(ii) 
and 1(h)(ii) both require that, in some way, China's CDM should form part of the calculation of AMS. 
Taking an approach which uses only Annex 3, or one which relies o nly on the CDM, would not 
properly incorporate both, as the Agreement on Agriculture  require s. In this vein, we consider that 
the FERP specified within Rev.3, including the time -period  used in its determination, is "constituent 
data" under the purview of  the Agreement on Agriculture. Incorporation of this constituent data into 
the calculation of China's AMS for the relevant basic agricultural products requires that this data be , 
at a minimum,  taken into account.  
7.261.   As discussed previously , it is unclear preci sely what it would mean to take China's CDM into 
account, rather than performing the calculation "in accordance with" China's CDM. However, the 
Panel understands that to ignore this constituent data would run counter to the idea that CDM has 
a role to play  in the calculation of AMS, as set out in Article 1(a) and (h) of the Agreement on 
Agriculture. To follow the United States' line of argumentation would be to effectively only rely on 
Annex 3 of the Agreement on Agriculture, rendering the references to CDM  within the Agreement 
superfluous.442 For these reasons, we disagree with framing the legal issue in this matter as one 
involving the concepts of conflict and the hierarchical application of norms. To us, the issue is not 
simply choosing between Paragraph 9 of Annex 3 or China's CDM. It rather involves an interpretation 
of Paragraph  9, in its context, that recognizes that it is part of the MPS Formula framework. In 
particular, we believe that the determination of the FERP applicable in the present case needs to 
carefully take into account all of our previous conclusions mentioned in paragraph  7.255 above . This 
implies carefully weighing and balancing these different factors before reaching our conclusion. In 
what follows, we will continue with this interpretative process.443 
                                                
439 We are mindful that throughout the proceedings, China has advocated for a "harmonious 
interpretation of Annex 3 and China's constituent data and methodology" and that the Panel need not reach 
the question of how to resolve any conflict between Annex 3 and Rev.3 (See Section V of China's second 
written submission). In our view, however, the notion of the so -called domestic -support -related commitments 
presupposes a hierarchical approach to the issue at hand.  
440 Panel Report, Korea – Various Measures on Beef , para. 813.  
441 See paragraph 7.165 . 
442 As if one were to follow China's line of argumenta tion much of Annex 3 would be rendered 
ineffective.  
443 In this process, we understand that in order to take into account the CDM, the Panel should give due 
weight to the FERP used in China's tables of supporting material, and in particular the years used to  determine 
that FERP, as constituent data when calculating China's AMS. We note that the Appellate Body has considered 
that, while not applicable to the factual situation before it at the time, a Member's CDM could potentially be 
used over the guidance of Annex 3 in certain circumstances. We consider that the circumstances before us are 
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  7.262.   We recall that the text of Paragraph  9 of Annex 3 explicitly refers to a particular time period. 
However, these elements need to be interpreted in the context provided  by other provisions of the 
Agreement on Agriculture. Paragraph 5 of Annex 3, indicating that the Base Total AMS should be 
calculated using the guidance of Paragraph s 6-13, is of particular relevance here. As we noted in 
section 7.4.5.2.2 above , we came to the factual conclusion that none of the 36 Members that have 
acceded to the WTO since 1995  have used a period of 1986 -88, with three except ions.444 This is 
important because , as per Paragraph  5 of Annex 3 , Paragraph  9 is meant to provide guidance for 
the calculation of the FERP for the purposes of determin ing Base Total AMS. However, and e ven in 
the face of this explicit guidance in Paragraph  5, the Base Total AMS of the referred Members did 
not use the time -period set out in Paragraph  9. The context provided by Paragraph  5, in conjunction 
with the above  consideration s, suggest s that the time -period mentioned in this provision  does not 
necessarily accommodate or envisage situations such as China's in this case , where the FERP used 
for the Base Total AMS was not anchored in the 1986 -1988 period .  
7.263.    In addition, we note that the fact that the time -period set out in Paragraph  9 has not been 
used in the tables of supporting material of non-original Members  provides useful context, on its 
own, for the interpretation of Paragraph  9. This is a consequence of the fact that the Base Total 
AMS, and most of the calculations necessary to produce it, are contained in the Members' tables of 
supporting material. These, in turn, are an integral part of Member's Schedules, thus being treaty 
text. In this vein, we recall that the  Appellate Body has stated that schedules of commitments of 
other Members are context when inter preting a Member's own schedule.445 We find this reasoning 
to be equally applicable when interpreting China's tables of supporting material , and by extension,  
Paragraph  9. Having  reached  this conclusion, we do not find it nece ssary to address China's 
argument relating to how this situation can be characterized as subsequent practice under Article 
31(3)(b) of the VCLT, nor do we express any view on this matter.446 
7.264.   Indeed, we note that both parties agreed with us in this conclusion  and that we could take 
the tables of supporting material into account in our legal interpretation of the provisions involved.447 
However,  the parties disagree as to the actual conclusions that could be extracted from this 
context.448 
                                                
particularly suited to considering the FERP, as constituent data, as having equal importance in the 
determination of China's AMS for certain products.  
444 See paragraph 7.214 . 
445 The Appellate Body has stated the following:  
There is, however, additional context referred to by the Panel and the participants that we must 
consider, namely: (i) the remainder of the United States' Schedule of specific commitments; (ii) 
the substantive provisions of the GATS; (iii) the provisions of covered agreements other than the 
GATS; and (iv) the GATS Schedules of other  Members.  
… 
Both part icipants, as well as the Panel, accepted that other Members' Schedules constitute relevant 
context for the interpretation of subsector 10.D of the United States' Schedule. As the Panel pointed out, this is 
the logical consequence of Article XX:3 of the GAT S, which provides that Members' Schedules are "an integral 
part" of the GATS. We agree. At the same time, as the Panel rightly acknowledged, use of other Members' 
Schedules as context must be tempered by the recognition that "[e]ach Schedule has its own in trinsic logic, 
which is different from the US Schedule." ( Appellate Body Report, US – Gambling , paras. 178 and 182.) 
(original footnotes omitted)  
446 China, response to Panel Question 46, paras. 196 -204; China, first written submission, para. 175. 
We recall that according to China, if the Panel were to use Members ' supporting tables as context , the Panel 
could consider that it would no longer be necessary or appropriate to address its argument on subsequent 
practice. (China's response to Panel question No. 87 ). 
447 China's response to Panel question No. 74 (second substantive meeting); United States' response to 
Panel's question No.  74 (second substantive meeting). In this connection, we note that the Appellate Body has 
stated that schedules of commitments of ot her Members are context when interpreting a Member's own 
schedule, see Appellate Body Report, US – Gambling , paras. 178 and 182.  
448 For China, the context provided from original Members' and non -original Members tables of 
supporting material demonstrates that the relevant provisions of the Agreement on Agriculture establish a 
single rule that requires each Member to use a three -year base period for establishing its domestic support 
reduction commitments, including for the identification of the applicable f ixed external reference prices to be 
used in the calculation of Base Total and Current Total AMS. For the United States, the customary rules of 
interpretation do not permit an interpreter to use context to reach an interpretation inconsistent with the 
ordinary meaning of the terms of the provision in question, such that they create a derogation or exception 
from the provisions of the agreement. In addition, it argues that those tables of supporting material do not 
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  7.265.   We see that t he relevance of the 1986 -1988 time -period set out in Paragraph  9 does not 
appear to be cast in stone  in the case of China . The Base Total AMS of none of the non-original 
Members (with one exception as noted above)  have used it , while being mandated to do s o by 
Paragraph 5 of Annex 3 . To us, this is an important factor that cannot be dismissed as a negotiation 
technicality , an historical account  or even an error , as suggested by the United States .449 In addition, 
and as we have previously noted, the calculatio n of Current Total and Base Total AMS is not only 
guided by Paragraph  9 of Annex 3 but also by a number of other provisions, including Paragraph  8 
of the same Annex. For this reason, the context provided by non-original Members' tables of 
supporting materi al is not only relevant for the interpretation of Paragraph  9 but also for the other 
provisions involved in the calculation of Base Total AMS and the MPS Formula framework.  
7.266.    We are mindful, however, that the mentioned context is perhaps more immediately r elevant 
for the calculation of the Base Total AMS than for the Current Total AMS. This is a consequence of 
the fact that the tables of supporting material only contain information relating to the Base Total 
AMS and not the Current Total AMS. But even in th e face of this, the mentioned context is still 
relevant for the calculations of the Current Total AMS. This is so because Base Total and  Current 
Total AMS' calculations are not entirely divorced. On the contrary, they are closely connected. This 
leads us t o our next point in our assessment: the consistency requirement.  
7.267.   We explored t he relationship between the Base Total and Current Total AMS in section  
7.4.5.2.3 above , where we concluded that the Agreement on Agriculture supports the necessity of 
maintaining a broad correspondence in the calculation process of these two measurements of 
domestic support. In particular, we noted that not doing so could lead to an app les-to-oranges 
comparison where a Member's compliance with its domestic support commitments could be the 
result of differences in the methodology applied to construct the AMS values and not of the domestic 
support measures actually being applied by a Membe r.450 In this vein, we note that using different 
time-periods to construct the FERP exacerbates this risk.  
7.268.    Indeed, we note that of the three components of the MPS formula, the only one that does 
not measure a contemporaneous feature of the market is the FER P, as it is an external reference 
price that is anchored in a specific time -period. In other words, while the AAP and the QEP are 
variables that may evolve depending on the regulatory framework and the time -period for which the 
AMS is being measured, the FERP is the only part of the MPS formula that will remain the same, 
regardless of the period for which the domestic support is being measured. In this way, the FERP is 
more akin to a constant than to a variable.  
7.269.    Recognizing that the FERP will not change r egardless of the year takes us to the source of 
a material incongruence that may arise when comparing Base Total and Current Total AMS  in the 
process of assessing a Member's compliance with its domestic support commitments . Simply put, 
using one time -period for the FERP used in the Base Total AMS and another for the Current Total 
AMS would yield two different results in the MPS formula that would be entirely uncorrelated to 
changes in the actual provision of domestic support by a Member. There would thus be different 
results  in these two measurements, even  if the values for the AAP and the QEP were the same.  
7.270.   For instance, at the end of the negotiations and once a Base Total AMS was calculated and 
memorialized in the tables of supporting material of a Member , a compliance assessment with the 
domestic support obligations of that Member, at that same moment in time, would lead to the 
strange result that there would be two different values of AMS to be compared, but with no changes 
in the underlying domestic sup port as neither the AAP nor the QEP would have changed. In other 
words, the Current Total AMS would yield a value that indicates a change in the provision of domestic 
support where none has occurred. This change would be an artificial result of not using t he same 
time-period for the FERP. To us, this is precisely why some broad correspondence in the calculation 
                                                
provide context for the calculation of Curr ent Total AMS, but rather to the calculation of Base Total AMS. 
China's response to Panel's question No. 74 (second substantive meeting); United States' response to Panel's 
question No. 74 (second substantive meeting).  
449 "Therefore, the commitment to maint ain levels of 'domestic support in favour of agricultural 
producers expressed in terms of Current Total AMS [that] does not exceed the corresponding annual or final 
bound commitment level specified in Part IV of the Member's Schedule,' and to calculate pro duct-specific AMS 
and Current Total AMS 'in accordance with' the Agreement, including Annex 3 and Article 6, apply whether or 
not its Base Total AMS contained errors or was calculated inconsistently with Annex 3" (original footnotes 
omitted). United States ' response to Panel's Question No. 102.  
450 See para. 7.243 . WT/DS511/ R 
 
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  process of both measurements is needed. This hypothetical scenario also shows that this broad 
correspondence has a direct relevance in the definitio n of the FERP.  
7.271.   The above leads us to conclude that allowing the use of a different time -period in the FERP 
used to calculate Current Total AMS, as compared to the one used for the Base Total AMS would 
potentially entail an apples -to-oranges  comparison , which would go very much against the broad 
correspondence that should exist in the calculation process of both measurements.  
7.272.   We recall that we found that a basis for this consistency requirement was the goal of the 
Agreement of Agriculture of achieving reduc tion commitments, as stated in the third recital of the 
preamble. In our view, this object and purpose of the Agreement on Agriculture should also guide 
our interpretation of Paragraph  9 and the applicable FERP in the present case. This interpretative 
tool indicates to us that this provision cannot be read so at to allow this type of incongruent results.  
7.273.   To finalize our assessment , we observe that our conclusions on how other Members' tables 
of supporting material provide context for the calculation of the Base Total AMS are also applicable 
to the Current Total AMS. This is because the broad correspondence in the calculation of both of 
these measurements makes the fact that none451 of the non-original Members have used the 1986 -
1988 time -period when calculatin g Base Total AMS also relevant to the calculation of the Current 
Total AMS. This is even more so when due account is taken that Paragraph  9 is applicable in both 
calculation processes. For these reasons, the context provided by  the parameters reflected in  tables 
of supporting material regarding this provision when calculating the Base Total AMS extend also to 
the Current Total AMS.  
7.274.   Lastly, we note that both Annex 3 and the CDM have to be used when calculating the Current 
Total AMS. Even if we assume, for th e sake of argument, that the CDM has only to be "taken into 
account" when calculating a product's AMS, and that this implies a lesser degree of consideration as 
compared to Annex 3, a decision to use the 1996 -1998 time -period is consistent with this approa ch. 
This is so because the general framework of Paragraph  9 is still being applied, namely, that the FERP 
is a three -year average of the f.o.b. or c.i.f. unit value for the basic agricultural product at issue. It 
is only the different time -period from the CDM which is being taken into account.  
7.275.   For these reasons, we conclude that the FERP to be used in this case is one that conforms 
with the requirements of Paragraph  9 of Annex 3, save for the time -period, which should be based 
on the same years used to calc ulate China's Base Total AMS, i.e. 1996 -1998.  
7.4.5.3   Quantity of production eligible to receive the AAP 
7.276.   We now assess the issues surrounding the third variable needed for the calculation of China's 
AMS in the form of market price support: the "quantity of production eligible to receive the applied 
administered price ". This variable denotes the proportion of production covered by the challenged  
market price support measures. The parties differ in their views on what constitutes the quantity of 
eligible produ ction in the case at hand. Therefore, the Panel must first address the meaning of this 
term.  
7.277.   The starting point for the Panel's analysis is the text of Annex 3, Paragraph  8, of the 
Agreement on Agriculture, which sets forth the guidelines for the calculati on of AMS:  
[M]arket price support shall be calculated using the gap between a fixed external 
reference price and the applied administered price multiplied by the quantity of 
production eligible to receive the applied administered  price.452 (emphasis  added)  
7.278.   The United States asserts that the ordinary meaning of "eligible " is "[f]it or entitled to be 
chosen fo r a position, award, etc."453, and t hus, the "quantity of production eligible " is a portion or 
amount of the commodity produced that is entitled to receive t he AAP. The United States t hus argues 
that "eligible production " within the meaning of Annex 3 is production which is fit or entitled to 
                                                
451 With the exceptions mentioned in Table 6 above.  
452 Agreement on Agriculture, Annex 3,  para. 8. (emphasis added)  
453 United States' first written submission, para. 102 (referring to Shorter Oxford English Dictionary , 
"eligible," p. 799 (ed. 1993) (Exhibit USA -64). 
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  receive the administered price, whether or not the production was actually purchased.454 The United 
States submits that t he Appellate Body in Korea – Various Measures on Beef  considered the meaning 
of the phrase and reached a similar understanding.455 
7.279.   The United State s also claims that where a marke t price support instrument places no limits 
on the volume of pr oduction that may be purchased, the  entirety of the production is "eligible", and 
that conversely, if a lim it such as on the geographic scope or a regulatory maximum is applied, that 
limit shou ld be accounted for when determining the volume "eligible" to receive the AAP.456 In this 
connection, the United States submits that the MP P Implementation Plans for wheat and rice limit 
eligible production only by geographic scope – and thus the relevant QEP is the  entire  production in 
the relevant provinces.457 
7.280.   China note s that the Agreement on Agriculture  does not contain a definition of the term 
"production eligible to receive the applied administered price" in Paragraph  8 of Annex 3, nor does 
it prescribe a particular methodology for the identification of the amount of production that is eligible 
to receive the AAP. China claims that the absence of any guidance on how to determine eligible 
production contrasts with the detailed guidance provided i n Paragrap h 9 of Annex 3 concerning the 
characteristics of FERPs458 and that in this context, the references in Articles 1(a)(ii) and 1(h)(ii) 
highlight that there is some flexibility for the WTO membership to agree to certain Member -specific 
methodologies relevant to  the calculation of AMS.459  
7.281.   China has argued that the appropriate methodology for the determination of "eligible 
production" stems from a harmonious interpretation  of the provisions of the Agreement on 
Agriculture  which gives meaning to both (i) the terms of Paragraph  8 of Annex 3 and (ii) the definition 
of "eligible production" set out in Rev.3 . China claims that this definition is incorporated in Annex 8 
of China's Accession Protocol, and is part of China's "term s of accession", with regard to China's 
domestic support commitments.460 For China, since the CDM contained in Rev.3 address es the 
methodology for the determination of "eligible production", including for wheat and rice, the Panel 
must include these in its i nterpretative exercise.461  
7.282.   We note that  the "quantity of production eligible to receive the applied administered price", 
sometimes referred to as the "quantity of eligible production"  or the "QEP"  in this report, is one of 
the variables used in calculating market price support. We agree with  the parties that the Agreement 
on Agriculture does not define this term. In order to discern the ordinary meaning of the term 
"quantity of eligible production", the Panel must review the language used in Paragraph  8, inc luding 
the part of the phrase which states "… to receive the applied administered price"  in its context and 
in light of the object and purpose of the provision .  
7.283.   The ordinary meaning of the words "quantity"462 and "production"463 is not disputed here. 
The oper ative term in this variable is the word "eligible". Eligible is defined as "f it or entitled to be 
chosen for a position, award, etc.".464 These terms must be read in conjunction with the remaining 
part of the clause, i.e. "to receive the applied administered  price." While we have already examined  
                                                
454 See Panel Report, Korea – Various Measures on Beef , para. 827 (noting that "e ligible production for 
the purposes of calculating the market price support component of current support should comprise the total 
marketable production of all producers which is eligible to benefit from the market price support, even though 
the proportion  of production which is actually purchased by a governmental agency may be relatively small or 
even nil").  
455 United States' first written submission, para. 103 (referring to Appellate Body Report, Korea – 
Various Measures on Beef , para. 120).  
456 United Stat es' second written submission, para. 105 (referring to Appellate Body Report , Korea – 
Various Measures on Beef , para. 120).  
457 United States' second written submission, para. 105.  
458 China's second written submission, para. 365.  
459 China's second written submission, para. 366.  
460 China's second written submission, paras. 260 and 359.  
461 China's second written submission, para. 364.  
462 Quantity refers to "an amount, a portion". Oxford English Dictionary Online, defintition of "quantity", 
available at: < http://www.oed.com/view/Entry/155929 >, accessed 11 June 2018.  
463 Production, in this sense, can be defined as "[a] thing produced as a result of an action, process, or 
effort; a product. Also: produce, prod ucts collectively". Oxford English Dictionary Online,  definition of  
"production", available at: < http://www.oed.com/view/Entry/60463 >, accessed 11 June 2018.  
464 The New Shorter Oxford English Dictionary , definition of "eligible", Vol. 1, 1993, p. 799.  
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  the meaning of "applied administered price"465, the word "receive " means  "to take, accept, regard, 
hear, etc. (something offered or presented, or to which attention is given) in a specified manner or 
with a specified expression of feeling ".466 We understand, therefore, that the quantity of production 
eligible to receive the AAP refers to the amount of production of a product which is fit467, or able to 
benefit from the price support provided through the AAP.  
7.284.   Turning to th e context of the provision, we note that Paragraph  8 of Annex 3 specifically 
links the AAP with the QEP by using the words "eligible to receive the applied administered price". 
The eligible quantity is  thus directly tied to  the AAP, in the sense that  only that amount of product 
that can receive the AAP enters the calculation of AMS.  As regards the AAP, there is no dispute 
between the parties that it  is a contemporaneous  variable that is determined for a particular year 
for which AMS is being calculated  and that Members would typically set out the AAP in the relevant 
market price support  measures themselves.468 In the Panel's view, a similar consideration applies to 
the QEP, due to the link drawn between the AAP and the QEP in the text of the Agreement on 
Agriculture itself. Additionally, were a limit to be placed on the quantity which would be procured at 
a particular price, that limit would relate specifically to the particular time -period in which the price 
applies. Such a limitation would need to be defined in the legal framework that regulates the 
provision of market price support in a given Member. Therefore, w e find that similarly to the AAP, 
the QEP should be determined with reference to the relevant regulatory framework and, in particular, 
the relevant m easures.   
7.285.   This can be contrasted with our discussion on  FERP, which is explained in detail above . By 
definition, the FERP is not a contemporaneous  variable, but is rather a data point that is anchored 
in a particular time -period – it is fixed. This means that this variable (or perhaps constant ) can be 
found in one fixed location, for instance in China's tables of supporting material, which does not vary 
through time. In this regard , the QEP is of a fundamentally different nature as it may vary  depending 
on the prevailing  regulatory framework.   
7.286.   This understanding of the term "quantity of production  eligible" as being contemporaneous 
and related to the relevant measures and their regulatory framework is consistent with the object 
and purpose of t he Agreement on Agriculture, which aims at "correcting and preventing restrictions 
and distortions in world agricultural markets".469 Such distortions result from support measures, 
including market price support, which affect decisions on whether to produce a particular agricultural 
product. These decisions are influenced not only by the AAP, but also by the extent of production 
which is covered by the challenged measures . In other words, knowing whether their production 
could receive market price support  could be just as important for agricultural producers as the AAP 
itself. It follows that in order to consider that there is a limit on eligible production, the market 
participants would need to be informed that the government would not be willing to pay the A AP for 
the entire production, but rather only for a subset of it.  As noted above, we would typically look for 
this information in the regulatory framework relevant to the operation of the measures. Otherwise, 
a panel would be assessing the eligibility of p roducts to receive the AAP in the abstract  and 
disconnect ed from the operation of the measures . 
7.287.   China argues  in this regard  that its tables of supporting material contain a definition of 
eligible production which must be considered following a holistic and harmonious interpretation of 
the Agreement on Agriculture, in the context of assessing the compliance of its market price support 
measures for wheat and rice with its domestic support reduction commitments.470 According to 
China, suc h alleged definition of eligible production forms part of its CDM and thus must be taken 
into account when calculating its AMS, as referenced in Articles 1(a)(ii) and (h)(ii).471 
7.288.   We agree with China that a panel must consider the CDM in a Member 's supporting  tables 
when calculating the AMS. This, however, does not mean that any reference to eligible production 
                                                
465 See Section 7.4.5.1  above.  
466 Oxford English Dictionary Online, defintition of "receive", available at: 
<http://www.oed.com/view/Entry/159411?rskey=Q2we63&result=2 #eid>, accessed 22 July 2018.  
467 See The New Shorter Oxford English Dictionary , definition of "fit", Vol. 1, 1993, p. 960, which is 
defined as "be suited to or appropriate for; Meet the requirements of".  
468 China's first written submission, paras. 189 -195; United States' first written submission, 
paras.  96-97. 
469 Second recital of the Preamble to the Agreement on Agriculture.  
470 China's firs t written submission, paras. 196 -203; China's second written submission, para. 358 -375. 
471 China's second written submission, para. 362.  WT/DS511/ R 
 
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  contained in the tables of supporting material should necessarily be regarded as the definition of 
"quantity of production eligible " within the meaning  of Paragraph  8 of Annex 3. As noted above, the 
QEP is informed by the operation of the challenged measures, which would be reflected in the 
calculation of the AMS. To us, this understanding of the QEP is consistent with Articles 1(a)(ii) and 
1(h)(ii) of t he Agreement on Agriculture. Contrary to what China appears to be suggesting, the 
language of these provisions, requiring that AMS be calculated either taking into account, or in 
accordance with, the CDM, does not imply that all components of the calculati on are necessarily 
determined by the CDM contained in the tables of supporting material.  
7.289.   In this vein, China argues that the Member -specific CDM may impact the ordinary meaning 
of "eligible production ", depending on the methodology that a Member used for the determination 
of eligible production as part of its CDM.472 China argues that the circumstances  in this dispute 
identif y a methodology used for the calculation of Base Total AMS whereby "eligible production " is 
determined on the basis of the "amount purc hased " and that same definition in endnote 19  of Rev.3  
also provides context for the calculation of Current Total AMS.473 China's argument in this regard 
relies on the notion that endnote 19 of its tables of supporting material contains a methodology for 
the determination of the quantity of eligible production; that China currently uses broadly similar 
market price support measures  to those used during their accession (the State Procurement Price 
and Protective Price programmes ); and that China may continue applying the same methodology 
for the determination of eligible production when calculating AMS under current measures.474 China 
asserts that b y explaining how the quantity of eligible production was determined for the measures 
in place at the time of China' s accession to the WTO , endnote 19 sets out a methodology that is 
capable of being, and should be, applied for purposes of calculating AMS, under Article 1(a)(ii).475 
7.290.   China asserts that  Rev.3 defines eligible production for China' s calculation of AMS from 
market price support as follows476:  
Eligible Production:  
Eligible Production for State Procureme nt Price refers to the amount purchased 
by state -owned enterprises from farmers at state procurement price for the food 
security  purpose  (see Endnote 10 of Support ing Table DS 1) ;  
Eligible Production for Protective Price  refers to the amount purchased by state -
owned enterprise from farmers at protective pr ice in order to protect farmer's  
income.477 
7.291.   Endnote  19 is affixed to the heading "Eligible Production" in Support ing Table DS:5 of China's 
Rev.3, which provides information on  China's MPS for the purposes of determining  China's  AMS 
during the years 1996 -1998. China argues that this wording reflects that China has made a 
commitment  to apply a methodology that determin es eligible production for market price support 
for wheat and rice as the quantity of wheat and rice purchased under an AAP.478 This argument 
seems to be based on  the premise that China's MPS measures do not contain an express limitation 
on the quantity of eligible production in the ordinary sense, and that this 'limitation' as it were, can 
be found by looking towards Rev.3 and China's CDM.  
7.292.   In this regard,  the Unit ed States argues that " China' s Supporting Table simply does not 
include a "definition"  of eligible production.  Rather it provides a factual description of market price 
support programs available to Chines e farmers between 1996 and 1998 ".479 The United States  also 
argues that China' s factual description of its "methodology " does not express an intent to change 
the "methodology " used in the future, or an agreement by the Members  that China could change 
                                                
472 China's second written submission, para. 372.  
473 China's second written submission, para. 372.  
474 China's response to Panel question No. 95, para. 280.  
475 China's second written submission, paras. 374 -378; China's response to Panel question No. 95, 
para. 282. 
476 China's first written submission, para. 199.  
477 WT/ACC/CHN/38/Rev.3, endnote 19, (Exhibit USA -43). 
478 China's respo nse to Panel question No. 88, para. 256.  
479 United States' response to Panel question No. 57, paras. 160 -161 ( first substantive meeting ). 
See also United States' response to Panel question No. 56 ( first substantive meeting ). 
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  that "methodology"  .480 Finally, the United States argues  that, when read together , endnote 10 and 
endnote 19  indicate that the volume purchased by the state -owned enterprises was the 
"predetermined " volume.  For the United States, this indicate s that the "methodology " utilized by 
China with regard to both program mes is consistent with the "methodology " demanded by Annex 3, 
paragraph 8, of the Agriculture  on Agreement, that is , that the volume of production eligible to 
receive the AAP is equivalent to the predetermined maximum purchase volume.481  
7.293.   As discussed in Parag raph 7.139 above , not everything included in the tables of supporting 
material is constituent data and methodology . We are unable to see how , in this case,  a mere 
reference to "eligible production" in endnote 19 in Supporting Table DS:5 of China's Rev.3 could be 
regarded as  a binding methodology to be used  prospectively  in the calculation of  China's AMS. 
Looking at the plain text of endnote 19 , the usage of t he word "refers" suggests that endnote 19 
merely describ es the "eligible production" that was used in the tables of supporting material upon 
China's accession to the WTO. It does not establish a methodology to assess the quantity of eligible 
production that should be applied when  calculating AMS at any other point in time .  
7.294.   This is a ll the more significant  as the text of endnote 19 only mentions eligible production in 
the particular  context of the "State Procurement Price" and " Protective Price" programmes . These 
are specific support measures that China had in place at the time of its accession. We thus 
understand the reference to "eligible production" in endnote 19 to be  directly tied to these 
program mes, which have long  since been terminated.482 In addition,  we note that u sing the 
description of  eligible  production contained in China's CDM would lead to calculation of support that 
is detached from the operation of the measures  challenged by the United States.  For these reasons, 
we find that endnote 19 does no t contain a methodology that would be relevant to our calculation 
of China's AMS . 
7.295.   We find further support for our interpretation of the QEP in the Korea – Various Measures on 
Beef report , where t he Appellate  Body held that "[p]roduction actually purchased may often be less 
than eligible production"483, and reiterat ed that "production eligible" refers to production that is "fit 
or entitled" to be purchased rather than production that was actually purchased".484 Contrary to 
China's argument, we consider the Appellate Body's reading of the  phrase  "quantity of production 
eligible" to apply outside of the specific context of the dispute in Korea – Various Measures on Beef ; 
when making that statement, the Appellate Body was deter mining the ordinary meaning of the term 
used in Paragraph 8 of Annex 3 , rather th an limiting  it to the facts of th at case.  
7.296.   In sum, the Panel considers that based on the plain meaning of the entire phrase "quantity 
of production eligible to receive the app lied administered price", the QEP should be determined as a 
current reflection of the amount of product which qualifies to be purchased from producers at the 
AAP. We do not consider the contents of endnote 19 to constitute a reflection of such an amount , 
nor to  have any bearing on the quantity of production eligible to receive the AAP in the years 2012 -
2015, the years for which AMS must be calculated for wheat and rice. As a result, the Panel must 
determine what the QEP actually was in those years, as refl ected in China 's regulatory framework 
for market price support. Considering the link between the AAP and the QEP, we understand that 
the appropriate starting point in this determination is the regulatory framework surrounding China's 
challenged market pric e support  for wheat, Indica rice and Japonica rice . 
7.297.   Turning to the content of the challenged  measures , we reiterate  that the underlying legal 
instruments  do not contain explicit numerical limitation s on the quantity of product which could 
receive the relev ant AAP, nor do they contain any methodology which could definitively determine a 
                                                
480 United States' comments on Chi na's response to Panel question No. 95, para. 126.  
481 United States' comments on China's response to Panel question No. 95, paras. 123 -125. 
482 "In 2004, China terminated the State Procurement System and the Protective Price Policy, in favor of 
a comprehensiv e opening  of the grain procurement market." China's first written submission, para. 25.  
483 Appellate Body Report,  Korea – Various Measures on Beef , para. 120.  
484 Appellate Body Report,  Korea – Various Measures on Beef , para. 120. The Panel understands that 
this statement, along with other references to that dispute, should be read in the context of the existence of a 
clearly defined limitation on purchases of beef by Korea. To the Panel, the referenced statement simply 
highlights that (i) the amount that is e ligible can be greater than the amount finally purchased, (ii) the eligible 
amount may be lower than the amount of total production, and (iii) it is the eligible  amount which is to be 
included in the AMS calculation, and not any other amount.  
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  specific  numerical limitation.485 More specifically, neither the Annual Notices nor the Implementation 
Plans explicitly mention any limits on the amount of grain to be purchase d by the designated entities . 
In fact, t he Implementation Plans require the relevant entities to acquire storage capacity to "match 
with the expected amount of grain purchased at the minimum price."486 They further instruct 
SinoGrain, ADBC and local authorit ies to use the available storage space, or procure new space, in 
order to "meet farmer's needs for grain selling".487 Additionally, China has confirmed that "t here are 
no limitations on the number and amounts of loans that the ADBC can provide to SinoGrain f or the 
purchase of grain, except for those relating to the financial stability of the bank. "488 Instructions to 
accommodate as much grain as is proffered, and the lack of any practical financial restrictions on 
buying  all grain available for purchase run directly contrary to the idea of a limit on purchasing. 
Finally, in certain of the Implementation Plans (notably those related to rice) the quantity of eligible 
production is set out: "The [product]  eligible to be purchased at the minimum procurement price  
refers to the in -grade product produced in [the relevant year] ."489 Similar or identical wording 
appears in many Implementation Plans.490 To us, this is a clear indication that the legal instruments 
do not impose any explicit limit on the QEP.  
7.298.   However, China argues that the regulatory framework underlying the challenged measures 
reveals five factors implicit ly limiting the quantity of production eligible: (i) the geographic scope of 
application of the measures491; (ii) the temporal application of the programmes492; (iii) the activation  
of the programmes only when the market price falls below the AAP and de -activation when the price 
rises above493; (iv) minimum quality requirements on products which may be purchased494; and (v) 
consumption of a "significant portion" of production on small -scale farms.495 China argues that by 
building limitations into the operation of the market price support programme , it ensures that only 
a limited amount of wheat and rice would be purchased at the AAP.  
7.299.   The United States , for its part,  submits  that China 's wheat and rice  Implementation Plans  
specify the provinces or autonomous regions where farmers are eligible to receive the AAP for their 
wheat,  Indica rice and Japonica rice.496 This means to t he United States that "the production in the 
designated provinces is eligible for support,  and in those provinces the state -owned enterprises will 
purchase all proffered product. "497 Therefore,  in the United States' view , the portion or amount of 
the agricultural  product  produced that is entitled to re ceive the  administered price is identified in the 
                                                
485 See para. 7.100  above.  
486 Article 5, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised), p. 3; Article 5, 2015 
Wheat and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 4; Article 5, 2013 Wheat 
Implementation Plan, (Exhibit USA -25/ CHN -19B Revised), p. 3; Article 5, 2014 Mid - to Late -Season Rice 
Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p. 4; Article 5, 2012 Early -Season Indica Rice 
Implementation Plan, ( Exhibit USA -44/CHN -34B Revised), p. 3; Article 5, 2014 Wheat and Early -Season Indica 
Rice Implementation Plan, ( Exhibit USA -26/CHN -30B Revised), p. 4.  
487 Article 5, 2015 Wheat and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 5; 
Article 5, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised), p. 3; Article 5, 2014 Wheat 
and Early -Season Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), pp. 5 and 13 See also 
Article 5, 2012 Early -Season Indica Rice Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 3 
(referring to "actual needs").  
488 China's re sponse to Panel question Nos. 43 and 44, paras. 189 and 191.  
489 2012 Early -Season Indica Rice Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 2. We 
note that the United States' translated version of the same document uses the language "[t]he early -season 
Indica rice for which minimum purchase prices will be implemented comprises within grade -standard products 
that are produced in 2012". The Panel considers that these two translations are substantively the same in 
content.  
490 See, for example, 2013 W heat Implementation Plan, (Exhibit USA -25/CHN -19B Revised), p. 2; 2014 
Wheat and Early -Season Indica Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), p. 3; 2014 Mid - 
to Late -Season Rice Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p. 3 ; 2012 Early -Season Indica 
Rice Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 2; 2013 Early -Season Indica Rice 
Implementation Plan, (Exhibit USA -46/CHN -35B Revised), p. 2; 2012 Mid -to Late -Season Rice Implementation 
Plan, (Exhibit USA -45/CHN -36B Revised), pp. 2 -3; 2013 Mid -to Late -season Rice Implementation Plan, (Exhibit 
USA-47/CHN -37B Revised), p. 4.  
491 China's first written submission, para. 208.  
492 China's first written submission, para. 209.  
493 China's first written submission, para. 210.  
494 China's first written submission, para. 211.  
495 China's first written submission, para. 212.  
496 United States' first written submission, para. 111.  
497 United States' first written submission, para. 107.  
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  measures  as all production produced in the identified provinces.498 China 's quantity of production 
eligible to receive the AAP is therefore the volume of wheat , Indi ca rice,  and Japonica rice  grown in 
covered  provinces or autonomous regions in the relevant year .499 
7.300.   We will now consider each of the factors raised by China to determine whether any of them 
in fact limit s the quantity of production eligible to receive the AAP.  
7.4.5.3.1   Geographical scope of the programme  
7.301.   Regarding the first factor, China claims that each Implementation Plan expressly limits the 
provinc es in which the measures can operate and that for the years 2012 to 201 5 they covered (i) 
six wheat -producing provinces; (ii) five early -season Indica rice -producing provinces; and (iii) eleven 
mid- to-late season Indica and Japonica rice producing provinces.500 According to China, t he six 
wheat -producing provinces, which accounted for 79.2% of China's total wheat production in 201 5, 
are Hebei, Jiangsu, Anhui, Shandong, Henan and Hubei.501 The five rice -producing provinces covered 
by the measures  for early -season Indica rice are  Anhui, Jiangxi, Hubei , Hunan and Guangxi .502 
Finally, the eleven rice -producing prov inces covered by the measures  for mid - to late -season Indica 
rice and J aponica rice are  Liaoning, Jilin, Heilongjiang, Jiangsu, Anhui, Jiangxi, Henan, Hubei, Hunan, 
Guangxi and Sichua n.503 Together , the rice -producing provinces covered by the Implementation 
Plans accou nt for around 79% of China' s total rice prod uction in 201 5.504 We note that the parties  
agree  on the geographical coverage of the challenged measures.505 The Panel shares this 
understanding.  
7.302.   As a result, the data submitted by the parties, and the data being used by the Panel in its 
calculations, is already limited geographical ly.506 The values designated as the QEP, by both the 
United States and China, are not the total amount of production of the relevant product throughout 
the whole of China, nor was that considered to be the case at any point. The y only include data from 
the regions specified in the measures, and thus this limitation has inherently  been taken into 
account. As stated by China, this limitation on geographical scope means that the QEP will initially 
be limited to approximately 79% of to tal national production for wheat and rice (in 2015).507  
7.4.5.3.2   Temporal scope of the programme  
7.303.    As for  the second factor, China argues that e ach Implementation Plan establishes limits on 
the time period in which the purchase s at minimum prices  may be implemented for the applicable 
year. The following table presented by China summarize s these temporal limits:508 
Table 7: Implementation periods of minimum procurement price for wheat and rice  
Year Wheat  Early Indica rice  Mid- and late -season 
Indica/Japonica rice  
2012  21/05/2012 -
30/09/2012  16/07/2012 -
30/09/2012  16/09/2012 -31/12/2012 (8 provinces);  
16/11/2012 -31/03/2013 (3 provinces)  
                                                
498 United States' first written submission, para. 107.  
499 United States' first written submission, para. 117.  
500 China's first written submission, paras 68 -69 (referring to Article 2, 2012 Wheat Implementation 
Plan, (Exhibit USA-24/CHN -29B Revised ), p. 2; Article 2, 2013 Wheat Implementation Plan, (Exhibit USA -
25/CH N-19B Revised), p. 2; Article 2, 2014 Wheat & Early -season Indica Rice Implementation Plan, (Exhibit 
USA-26/CHN -30B Revised), p. 3; Article 2, 2015 Wheat & Rice Implementation Plan, (Exhibit USA -27/CHN -28B 
Revised), p. 2.  
501 China's first written submission, para. 70. For production data, see: China's Rural Statistical 
Yearbook (2016) , (Exhibit USA -76/CHN -33), p. 168.  
502 China's first written submission, para. 71.  
503 China's first written submission, para. 71.  
504 China's first wr itten submission, paras. 72 and 208.  
505 The United States lists the same wheat - and rice -producing Chinese provinces that are covered by 
the challenged measures. United States' first written submission, paras. 33 and 52.  
506 See United States' answer to Panel  question No. 94; United States' first written submission, 
paras.  117-121; China's first written submission, paras. 68 -72. 
507 China's first written submission, para. 208.  
508 China's first written submission, paras. 73 -74. 
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  2013  21/05/2013 -
30/09/2013  16/07/2013 -
30/09/2013  18/09/2013 -31/01/2014 (8 provinces);  
16/11/2013 -31/03/2014 (3 provinces)  
2014  21/05/2014 -
30/09/2014  16/07/2014 -
30/09/2014  16/09/2014 -31/01/2015 (8 provinces);  
01/11/2014 -31/03/2015 (3 provinces)  
2015  21/05/2015 -
30/09/2015  16/07/2015 -
30/09/2015  16/09/2015 -31/01/2016 (8 provinces);  
10/10/2015 -29/02/2016 (3 provinces)  
 
7.304.   The Panel notes, as in paragraph 7.105 above , that generally, these time -periods 
immediately follow the annual harvest period in the major wheat and rice produc ing provinces.509 
Therefore, the  measures  are operating at the times during which the vast majority of relevant 
products are being sold on the market.510 Indeed, it is during those periods that the supply will be 
at its highest as most farmers are seeking to s ell their crops  and the prices are most likely to fall  
below the minimum level . In addition,  there is nothing  in the measures  that would prevent producers 
from timing the sale of their harvests  at the AAP  during  the implementation periods . Therefore, the 
Panel finds that restricting the availability of the AAP to certain time -periods does not affect the 
eligibility of products to receive the AAP, nor can it lower the quantity of production eligible to receive 
the AAP.  
7.4.5.3.3   Activation and de -activation of the pro gramme  
7.305.   Regarding the third  factor , China submits that the Implementation Plan s also provide that 
purchases at minimum procurement prices are activated  only "when the grain market price drops to 
the minimum procurement pric e stipulated by the government"511, and that i n addition to the 
"switching -on" of the program me when prices fall below the minimum price, there is also a 
"switching -off" of the program me in a city/county when the market price rises again above the 
minimum price.512  
7.306.   In this regard, we note tha t this is  simply  how market price support operates in this case. It 
is inherent to market price support measures that support will only be provided when the market 
price falls below the AAP , which is a minimum price. If the market price is above the AAP, p urchases 
on the market will naturally not be made at the AAP. As soon as the market price falls below the 
AAP513, all of a given product can be bought by the relevant entities at the AAP , until the price rises 
again above the minimum level . China confirmed t hat if the market price for wheat and rice fell 
below the AAP for an extended period of time, the relevant entities would continue to make 
purchases without restriction while the measures  were activated.514 Activation and deactivation does 
not affect the eli gibility of products to receive the AAP, nor can it lower the quantity of production 
eligible to receive the AAP. 
7.4.5.3.4   Minimum grain quality requirements  
7.307.   Regarding the fourth factor, China argues that only wheat and rice of a certain quality can 
be purchased under the programmes . China cites, as an example, Article 4 of the 2015 
                                                
509 United States' first written submi ssion, para. 54.  
510 Article 9, 2012 Wheat Implementation Plan, (Exhibit USA -24/CHN -29B Revised), p. 5; Article 9, 2014 
Mid- to Late -Season Rice Implementation Plan, (Exhibit USA -48/CHN -31B Revised), p. 6; Article 9, 2015 Wheat 
and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), p. 6; Article 9, 2013 Wheat 
Implementation Plan, (Exhibit USA -25/CHN -19B Revised), p.5; Article 9, 2012 Early -Season Indica Rice 
Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 5; Article 9, 2014 Wheat and Early -Season Indica 
Rice Implementation Plan, (Exhibit USA -26/CHN -30B Revised), pp. 6 and 14.  
511 China's first written submission, para. 75 (referring to Article 6, 2015 Wheat and Rice 
Implementation Plan, (Exhibit USA -27/CHN -28B Revised), pp. 5 -6). 
512 China's fir st written submission, para. 79 (referring to Approving the activation of Wheat 2015 
Minimum Procurement Implementation Plan in Linyi City in Shandong Province (Zhong Chu Liang Lu [2015] 
No. 141), 25 June 2015, (Exhibit CHN -42B), p. 1).  
513 Following a three -day monitoring period, and following approval by the State Administration of Grain. 
See China's response to Panel question No. 36, paras. 151 -152. 
514 See China's response to Panel question No. 41, where China responded similarly through implication, 
but no ted that the scenario the Panel had described was virtually impossible, and highly unlikely to occur, due 
to considerations of supply and demand (but crucially, not considerations regarding limitations on purchases ). 
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  Implementation Plan  that provides that "[g]rain subject to the minimum procurement price refers 
to the in -grade products produ ced in 2015 ", i.e. products which satisfy the minimum grade 
requirements prescribed by the applicable national standards .515 Moreover, China's "Notice on 
Issuing the Rules on Matters Related to Implementing National Standards of Grain and Oil Quality " 
provid es that grains below these grades shall not be purchased by the government.516  
7.308.   China has stated that grain of quality inferior to "grade 5" grain (the minimum quality517 
accepted for purchase under the domestic support measures ), known as "out -of-grade" grain , is not 
subject to a minimum purchase price and is not able to be procured under the Implementation 
Plans.518 The question in relation to this argument is whether this amount of out -of-grade grain has 
already been taken into account in the data provided as the "quantity of eligible production" by 
either of the parties. If not, this limitation would have to be taken into account when calculating the 
respective AMS and the relevant percentage of the production which is considered out -of-grade 
would have to be excluded from the QEP, as the AAP would not be able to apply to this out -of-grade 
product. This is reinforced by the wording found within many of the Implementation  Plans. As noted 
above, certain of these reports include the phrase "[t]he [product]  eligibl e to be purchased at the 
minimum procurement price refers to the in-grade  product ".519 Out-of-grade product is explicitly 
excluded from eligibility.  
7.309.   Both China520 and the United States521 have provided data relating to out -of-grade grain 
though neither has expre ssly indicated whether this number has been taken into account in the data 
provided by the parties.522 From each party's arguments we can assume that the data provided by 
China does indeed take this limitation into account and deducts the relevant amount fro m what it 
determines as the QEP523, while the United States does not. The United States argues that the 
amount is "negligible" and that "off grade grain is a de minimis  volume each year".524  
7.310.   The United States argues that "China' s MPS Programs provide applied administered pr ices 
for all grade -able grain. " The United States conten ds that "[i] f a farmer plants wheat, rice, or corn, 
especially if she does so in anticipation of receiving the applied administered price from the 
government, the farmer intends to grow  sell-able, grade -able grain. "525 We agree that  "no farmer 
intends to grow "off grade"  product "526, but we also note  this does not change the fact that any 
quantity of grain , which is determined to be out -of-grade , could not receive the AAP, and is therefore 
ineligible to receive it . 
7.311.   This fourth limiti ng factor  is compelling, in that it will directly impact the amount of product 
that is eligible to receive the AAP.  Given the above, the Panel will take this additional limitation into 
account in its determination  of China's QEP for the respective products.  
                                                
515 China's first written submission, para. 82 (referring to Article 4, 2015 Wheat and Rice 
Implementation Plan, (Exhibit USA -27/CHN -28B Revised), pp. 2 -3). 
516 China's first written submission, para. 82 (referring to 2010 National Standards of Grain Quality 
Notice , (Exhibit CHN -43B Revised) . 
517 See Article 4, 2015 Wheat and Rice Implementation Plan, (Exhibit USA -27/CHN -28B Revised), pp. 2 -
3; National Wheat Standard (GB1351 -2008) (English translation), (Exhibit CHN -91B); National Rice Standard 
(GB1350 -2009) (English translation), (Exhibit CHN -92B). 
518 See China's response to Panel question No. 25, paras. 110 -113, referring to 2010 National Standards 
of Grain Quality Notice,  (Exhibit CHN -43B Revised), p. 2.  
519 2012 Early -Season Indica Rice Implementation Plan, (Exhibit USA -44/CHN -34B Revised), p. 2. 
(emphasis added)  
520 China's response to panel question No. 93, Table 6.  
521 United States' response to Panel question No. 93.  China's State Administration of Grain, Standard & 
Quality Center, Quality Survey Reports 2010 -2016, (Exhibit USA -98). 
522 The Panel notes the United States' argument  that China has not provided sources supporting its 
data, as well as both part ies' acknowledgements that the data that was provided by both parties is consistent.  
See also China's response to Panel question No. 93.  
523 As China o nly considers production purchased to be eligible, any out -of-grade product that was not 
purchased would necessarily not be included in China's reporting of its QEP.  
524 United States' response to Panel question No. 93; United States' comments on China's res ponses to 
question No. 93.  
525 United States' response to Panel question No. 25, para. 103.  
526 United States' response to Panel question No. 25, para. 103.  
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  7.4.5.3.5   Consumption of grain on small -scale farms  
7.312.   Regarding the fifth and final factor , China argues that it is necessary to keep in mind that, 
similar to the situation in many other developing countries, small -scale f arms in China typically 
consume a significant portion of the  staple foods that they produce and that  smallholder farmers 
often put aside a portion of their wheat and rice production to be used either as food for the family, 
animal feed, or to guard as see ds for the next planting year.527 According to  China, t hese smallholder 
farmers also use the wheat and rice they harvest as barter for ot her crops or goods or services .528 
As a result,  the total amount of wheat and rice available to be sold by farmers on the market or 
under the minimum procurement price  program me is, in China's view , smaller than the total amount 
of wheat and rice actually produced.529 
7.313.   In this regard, China submits that it  tracks the amount of non -marketable production of 
wheat and rice through the use of a "commodity rate " - the ratio in any given year between the 
annual amount of wheat or rice sold and the total production .530 China states that " between 9 -18 
percent of tota l wheat production in China in 2012 -2015, and between 17 -22 percent of total rice 
production in China during the same period was consumed or retained by Chinese farmers, and not 
available for purchase in the marketplace ".531 
7.314.   As noted, the discussion in this section is about the amount of production that is eligible  to 
receive the AAP. Whether the grain is consumed on -farm or sold at the market, the pertinent 
question is whether the grain that was produced would be able to benefit from the AAP if the seller 
so desired. The Panel considers that, as China had not specified a limitation on how much of each 
product could be purchased  if the market price is below the AAP, the entirety of the crop produced 
on the farm would be eligible , in the ordinary meaning of the  word, to receive the AAP.  
7.4.5.3.6   Conclusion  
7.315.   As a result, the Panel considers that, in addition to the geographical limitation already taken 
into account in the data  provided by the parties,  only one of the above alleged limitations – the 
volume of out -of-grade grain for each year - impact s the eligibility of the relevant products to receive 
the AAP. Production which is determined to be out -of-grade cannot benefit from the AAP, and thus 
cannot be included in the QEP when calculating AMS. In the absence of any explicit or implicit limits 
in the challenged Chinese measures,  the Panel understands the QEP, or quantity of production 
eligible to receive the AAP, to be the entire volume of production in the relevant specified provinces, 
less any out -of-grade grain.   
7.4.5.4   Processing -level adjustment  
7.316.   We turn now to the last outstanding issue regarding the definition of the variables of the 
MPS F ormula, which relates to the processing -level adjustment that may be required to be applied 
to some of these variables.  
7.317.   Simply put, t his issue arises because of the differences between the FERP used in Rev.3., 
which refers to milled and semi -milled rice , and the AAP, which China provides for unmilled paddy 
rice sold by farmers.532 This fact  requires  the adjustment of some of these variabl es either to a 
                                                
527 China's response to Panel question No. 54.  
528 China's first written submission, paras. 84 -86 (referrin g to John Davis & Ping Zong, " Household own -
consumption and grain marketable surplus in China ", Applied Economics, 34:8  (2010) , 969-974, (Exhibit CHN -
46); David Buschena, Vincent Smith and Hua Di, " Policy reform and farmers' wheat allocation in rural China : a 
case study ", Australian Agricultural and Resource Economics Society Inc. and Blackwell Publishing Ltd, 2005, 
(Exhibit CHN -47)). 
529 China's first written submission, paras. 84 -86. 
530 China's first written submission, para. 85; 2016 Agricultural Costs and Benefits, (Exhibit CHN -4B), 
p. 123. 
531 China's first written submission, para. 86.  
532 The United States explains that:  
 
At harvest, rice is known as "paddy" or "rough rice." Typically, paddy rice must be processed or 
milled for human consumption. The first s tage of milling (cleaning/shelling) creates "brown rice," 
and the rice may be subsequently further polished (removing the bran) into white rice. 
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  higher or lower level of processing: from unmilled rice to milled rice , or vice versa , to avoid a 
situation where each of the variables reflects a different processing stage for rice.  
7.318.    Both parties agree on the necessity of this adjustment.533 However, they disagree on (i) the 
extent of the adjustment; and (ii) the variable to which it should be applied. China argues that s ince 
the data for the AAP and the QEP is presented at the  processing level of unmilled rice , it is necessary 
to adjust  both of  these  to reflect the processing level of "semi-milled or wholly milled rice, wh ether 
or not polished or glazed", that is, the level of the FER P.534 The United States  argues for adjustment 
of the FERP (milled rice) downwards, to match the unmilled le vel of the AAP and the QEP .  
7.319.   Table 9 outlines the various levels of processing for rice  in the available data for the FERP, 
the AAP and the QEP . 
Table 8: Comparison of levels  of processing  for relevant rice data535 
Variable  Level of processing  
Eligible production  Paddy /unmilled  rice536 
AAP Paddy /unmilled  rice537 
FERP semi-milled or wholly -milled rice, 
whether or not polis hed or glazed538 
 
7.320.   We note that China relies on an OECD report  which explains that, in the first level of 
processing,  80% of the volume of un milled paddy rice is retained as brown rice, while 20 % of the 
volume of unmilled  rice is discarded hulls. In the next level of processing, to produce milled rice, 
another 10 % of the volume is lost.539 For these reasons, China contends  that the average "milling 
rate" or "milling yield " of unmilled rice to milled brown rice is 70%540 and that t his is consistent with 
the United States ' own statistics, which applied a conversion rate of 70% to express the relationship 
between unmilled  rice a nd milled rice, as exported.541 China's  adjustment thus uses a "milling rate " 
of 70 % to adjust both the volume of eligible production and the AAP from unmilled rice to milled 
rice, which China contends is the same  rate as used in Rev.3.542 China is therefore maintaining that 
the rate used to adjust the volume in the QEP should similarly be applied to the adjustment of price 
in the AAP, because "the volume /quantity  effect of further processing rice is the predominant factor 
affecting the pri ce of rice at different level s of processing ."543 
7.321.   For its part, t he United States explains that it  has constructed  a price-based  adjustment 
factor based on a comparison of available monthly pricing data for milled rice versus unmilled rice 
                                                
Agricultural production statistics typically report rice production on a paddy or rough basis, since 
this accou nts for the entire weight of the grain, but milled and polished rice accounts for the 
majority of international rice exports and imports. (United States' first written submission, 
para. 45.) 
 
533 This point was confirmed by the panel in Korea – Various Measu res on Beef  which found that "both 
the FERP and the AAP must be calculated at an equivalent stage of processing or converted accordingly". Panel 
Report, Korea – Various Measures on Beef , para. 828.  
534 China's response to Panel question No. 99.  
535 There is no  disagreement between the parties on the level of processing of the different variables.  
536 China's first written submission, para. 236; China's response to Panel question No. 38, para. 162.  
537 China's first written submission, para. 236; China's response to  Panel question No. 38, para. 162.  
538 China's tables of supporting material, Appendix DS 5 -4: f.o.b. Prices for Corn, Japonica rice and 
Indica rice, WT/ACC/CHN/38/Rev.3, (Exhibit USA -43). 
539 OECD 2016 Document on Compositional Considerations for New Varietie s of Rice, (Exhibit CHN -65), 
Table 5.  
540 China's first written submission, para. 241 (referring to the OECD 2016 Document on Compositional 
Considerations for New Varieties of Rice, (Exhibit CHN -65), Table 5).  
541 China's first written submission, para. 228 (referring to United States Department of Agriculture, 
World Agricultural Supply and Demand Estimates, August 2017, U.S. Rice Supply and Use (Rough Equivalent of 
Rough and Milled Rice), (Exhibit CHN -66)). 
542 China's first written submission, para. 235 (refe rring to Conversion rate applied in WT/ACC/CHN/38/, 
(Exhibit CHN -64)). 
543 See China's response to Panel question No. 38, para. 170, where China states that the use of a 
volume -based conversion rate is also reasonable and appropriate for the price -based conv ersion required here, 
and consistent with an objective assessment of the facts.  
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  in China544 and that  the calculated adjustment rate  of milled  to unmilled rice in China is 60% .545 This 
60% price conversion  rate was developed by comparing published prices of milled rice to unmilled 
rice and calculating an average rate for the 12 year period of available data .546 Any adjustment to a 
price within the equation, according to the United States, should be made at a rate of 60%.  
7.322.   We agree with the parties that  a processing -level adjustment is necessary to  avoid a 
mathematically inappropriate comparison . However, and as  mentioned above, we observe two 
issues which must be resolved before applying such an adjustment : (i) the variable or variables 
which should be adjusted ; and (ii) the rate of the adjustment.   
7.4.5.4.1   Which variable should be adjusted  
7.323.   With respect to the question of which variables should be adjusted , we consider that it is 
appropriate to first determine whether the Agreement on Agriculture provides any guidance in this 
regard.  
7.324.   The starting point of our analysis is the text of the Agreement on Agriculture. In this regard, 
there are two relevant sections: (i) Paragraph 7 of Annex 3 states that the AMS "shall be calculated 
as close as practicable to the point of first sale of the basic agricultural product concerned" ; and  (ii) 
Article 1(b) of the Agreement on Agricult ure provides that  that ""basic agricultural product"  in 
relation to domestic support commitments is defined as the product as close as practicable to the 
point of firs t sale as specified in a Member' s Schedule and in the related supporting material ".  
7.325.   These provisions furnish some guidance in our determination of the most appropriate 
variable to be adjust ed. However, they  do not , in themselves , set out a mandatory  rule as to the 
variable that should be adjusted.   
7.326.   We now turn to assess the possible guidance afforded by  the Agreement on Agriculture  in 
order to  be able to  calculate China's AMS for the most appropriate  rice product at a level closest to 
the point of first sale . 
7.4.5.4.1.1   Basic agricultural product  
7.327.   Article 1(b) of the Agreement on Agriculture states that ""basic agricultural product"  in 
relation to domestic support commitments is defined as the product as close as practicable to the 
point of firs t sale as specified in a Member' s Schedule and in the related supporting material ". The 
phrase is also relevant in Annex 3 : Paragraph  1 states " subject  to the provisions of Article 6, an 
Aggregate Measurement of Support (AMS) shall be calculated on a product -specific basis for each 
basic agricultural product receiving market price support"; Paragraph  7 provides that " [t]he AMS 
shall be calculated as close as practicable to the point of first sale of the basic agricultural product 
concerned. Measures directed at agricultural processors shall be included to the extent that such 
measures benefit the prod ucers of the basic agricultural products"; and Paragraph  9 indicates  that 
"[t]he fixed external reference price … shall generally be the average f.o.b. unit value for the basic 
agricultural product concerned in a net exporting country … in the base period ."  
7.328.   The plain meaning of the phrase "basic agricultural product" is important for our purposes. 
"Basic" is defined as " [o]f, pertaining to, or forming a base "547 and "constituting or serving as the 
                                                
544 United States' first written submission, para. 115.  
545 United States' first written submission, paras. 115 -116 (referring to the Agreement on Agriculture, 
paragraph 9 of Annex  3; Panel Report  Korea – Various Measures on Beef , para. 828 (stating that "the fixed 
external reference price must be at (or converted to) the same stage in the processing chain as the applied 
administered price for the basic agricultural product(s) concerned")).  
546 See China National Bureau of Statistics, China Yearbook of Agricultural Price Survey  (2006), (Exhibit 
USA-69); China National Bureau of Statistics, China Yearbook of Agricultural Price Survey  (2008), (Exhibit 
USA-70); China National Bureau of Statistics, China Yearbook of Agricultural Price Survey  (2012), (Exhibit 
USA-71); 2014 China Yearbook of Agricultural Price Survey, (Exhibit USA -72); China National Bureau of 
Statistics, China Yearbook of Agricultural Price Survey  (2016), (Exhibit USA -99). 
547 Oxford English Dictionary Online, defintition of "basic", available at: < OED Online, 
http://www.oed.com/view/Entry/15848 >, accessed on 22 July 2018.  
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  basis or starting point".548 A "product" is " [a]n object produc ed by a particular action or process"549 
while "agricultural" is " [o]f, relating to, or used in agriculture"550 which is "the practice of growing 
crops, rearing livestock, and producing animal products".551 As such, a "basic agricultural product" 
in the current case would be an object produced through the practice of growing crops which forms 
a base or starting point for potential further processing.  
7.329.   China argues that the phrase  "as close as practicable to the point of first sale" is used in the 
context of identi fying the basic agricultural product. This phrase allegedly emphasizes that the basic 
agricultural product specified in a Member's schedule is not simply an identification of the product 
variety , but also an identification of the processing level  of the pr oduct. According to China, the key 
to identifying the basic agricultural product lies in the phrase  "as specified in a Member's Schedule 
and in the related supporting material" which suggests that the basic agricultural product, or more 
specifically, the p rocessing level of the basic agricultural product,  can be found in a Member 's 
schedule and supporting material.  In this regard, China states that " Rev.3 … specified the processing 
level for [Indica rice and Japonica rice] , which is "semi-milled or wholly milled rice, wheth er or not 
polished or glazed" .552"553  
7.330.   The United States argues that "for Indica and Japonica rice, there is no indication of the type 
of rice, either for the external reference prices or the AAPs. China asks the Panel to infer a chos en 
point of sale and a type of "basic agricultural product"  based on the comparison on various draft 
Supporting Tables, none of which contains any explicit written reference to this point of sale , and 
the recollection of China' s negotiators554".555  
7.331.   Indica rice and Ja ponica rice were net export products in China's 1996 -1998 base period and 
thus their external reference prices were determined by the f.o.b. prices, on the basis of China's 
Customs statistics.556 
7.332.   The Panel considers that  the reference in Paragraph  9 of Annex 3 to "the average f.o.b. unit 
value  for the basic agricultural product concerned ..." requires that the AAP and the FERP must both 
be for the "basic agricultural product" . This reasoning is reinforced by Paragraph  7, discussed further 
below, wh ich states that AMS "shall be calculated as close as practicable to the  point of first sale of 
the basic agricultural  product  concerned" . 
7.333.   In addition,  as pointed out by the United States,  the inclusion of the phrase: " measures 
directed at agricultural proc essors  shall be included to the extent that such measures benefit the 
producers of the basic agricultural product s" in Paragraph 7 of Annex 3  reinforces the understanding 
that product -specific AMS should be calculated so as to measure the benefit at the first point of sale, 
which typically would involve the producers.557 According to China, the United States' approach  here 
ignores the purpose of this part of  Paragraph 7, which  China alleges  is to eliminate  (from the AMS 
calculation ) measures that do not constitute domestic support because they are not provided "in 
favour of domestic producers" or "in favour of agricultural producers".558 We disagree . The Panel is 
required to holistically interpret the relevant provisions . In this case , this means interpreting  the 
meaning of "basic agricultural product" in light of the specific exclusion of measures directed at 
                                                
548 Merriam -Webster Online, definition of "basic", available at: <  https://www.merriam -
webster.com/dictionary/basic >, accessed on 22 July 2018 .  
549 Oxford English Dictionary Online, defintition of "product", available at: < OED Online, 
http://www.oed.com/view/Entry/151988 >, accessed on 22 July 2018.  
550 Oxford English Dictionary Online, defintition of "agricultural", available at: OED Online, 
<http://www.oed.com/view/Entry/4178 >, accessed on 22 July 2018.  
551 Oxford English Dictionary Online, defintition of "agriculture", available at:  OED Online, 
<http://www.oed.com/view/Entry/4181 >, accessed on 2 2 July 2018.  
552 See the fixed external reference prices for Indica rice and Japonica rice in Table DS5 of Rev.3, which 
exactly match the fixed external reference prices for Indica rice and Japonica rice in Appendix DS 5 -4 of Rev.3. 
See also Conversion rate applied in WT/ACC/CHN/38/, (Exhibit CHN -64), which indicates that the data for the 
applied administered price and the eligible production for Indica rice and Japonica rice contained in DS5 of 
Rev.3 had been adjusted to reflect milled rice d ata. 
553 China's response to Panel question No. 99, para. 317. (footnote original)  
554 Conversion rate applied in WT/ACC/CHN/38, (Exhibit CHN -64). 
555 United States' response to Panel question No. 99, para. 179. (footnote original)  
556 See WT/ACC/CHN/38/Rev.3, end note 17(2), and Appendix DS  5-4, (Exhibit USA -43). 
557 United States' response to Panel question No. 99, para. 176.  
558 China's comments on the United States' response to Panel question No. 99, para. 247 (referring to 
Agreement on Agriculture, Article 3.2, 6.1 , 6.3, 7.1 and 7.2(a).  WT/DS511/ R 
 
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  agricultural processors from the AMS calc ulation, unless those measures benefit agricultural 
producers.   
7.334.   What the Panel has to determine in this part of its analysis, therefore, is the  particular  basic 
agricultural product in this case.  Importantly, while the definition of "basic agricultural pro duct" in 
Article 1(b) of the Agreement on Agriculture includes a reference to a Member's schedule, Paragraph  
7 of Annex 3 refers only to the "point of first sale" of the agricultural product concerned.  
7.335.   The United States may be correct in its assertion that China's tables of supporting material 
do not explicitly set out the level of processing of each of the rice products at issue here, contrary 
to China's argument. However, China's tables of supporting m aterial do refer to HS Code  10063000  
for Japonica rice and 10063000  for Indica rice, in Appendix DS 5 -4: "f.o.b. Prices for Corn, Japonica 
Rice and Indica Rice ". These HS Codes refer to "semi -milled or wholly -milled rice, whether or not 
polished or glazed" . We consider that while China is able to specify the basic agricultural product in 
its Schedule, this may not  necessarily  extend to specifying the level of processing , especially for the 
purposes of calculating AMS . In this regard, while China has include d the HS code of milled rice 
variants  to which a reader can refer , it has identified each of "Indica rice" and "Japonica rice" by 
name.  
7.336.   The product included in the tables of supporting material (which, in this particular instance, 
is milled rice) has an f .o.b. price to determine the FERP. We understand that milled rice is included 
for the purposes of demonstrating an f.o.b. price as required by Paragraph  9 (as unmilled rice is 
generally not exported  or imported  to any significant degree ). This product does not necessarily 
accord with the overarching requirement that AMS should be calculated as close as practicable to 
the point of first sale, as further discussed below.  We see a fundamental disconnect between China's 
specification of the "basic agricultural product" in its tables of supporting material, and the "point of 
first sale " of rice. It is not necessary to decide which of these would prevail in the abstract . Our task 
here is to calculate the AMS for each relevant product . This  is to be done as close as practicable to 
the point of first sale.  
7.337.   The Panel needs to  determine the basic agricultural product  here for the purposes of properly 
calculating China's AMS.  There is no obligation to determine the basic agricultural product on  the 
basis of China's tables of supporting material  alone, and we will also consider the "point of first sale " 
which would accord most with the ordinary meaning of "basic agricultural product" , as defined above. 
We understand  that the relevant product  in China's tables of supporting material  has been specified 
as "Indica rice" and "Japonica rice" . We turn to examine the point of first sale of such rice, as 
specifically directed by Paragraph  7 of Annex 3.  
7.4.5.4.1.2   Point of first sale  
7.338.   Paragraph 7 of Annex 3, concerned with the AMS calculation itself, states that the AMS "shall 
be calculated as close as practicable to the point of first sale of the basic agricultural product 
concerned".559  
7.339.   The United States argues that the phrase " point of first sale " indicates that "the AMS is to 
be calculated in relation to the first instance the commodity is sold " and that "[t] he relevant point 
of first sale in this dispute is when Chinese farmers in the relevant provinces sell their wheat, Indica 
rice, [or] Japonica rice, … to the Chinese government or entities purchasing at the direction of the 
Chinese government ".560 Specifically in regard to rice, the United States submits that the first sale 
defined in this way would be on an unmilled rice basis and that therefore the FERP  for rice must  be 
converted to an unmilled rice equivalent value . 
7.340.   China, for its part, argues that the phrase  "as close as practicable to the point of first sale " 
emphasize s that the basic agricultural product specified in the Schedule is not simply an ident ification 
of the product variety , but also an identification of the processing level  of the product .561 For China, 
                                                
559 See also Agreement on Agriculture, Article 1(b) which defines "basic agricultural product" in relation 
to domestic support commitments … as the product as close as practicable to the point of first sale as specified 
in a Member's S chedule and in the related supporting material".  
560 United States' response to Panel question No. 99.  
561 China's response to Panel question No. 99.  
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  the words "a s close as practicable " indicate that the basic agricultural product is not necessarily the 
product at the beginning of the process ing chain sold at the point of first sale , but rather, that it can 
be a further processed product. China argues that it has specified in its tables of supporting material 
that the processing level  for the two varieties  of rice is  "semi-milled or wholly milled rice, whether 
or not polished or glazed ", and subsequently that this is the basic agricultural product related to 
rice.562  
7.341.   We believe that the relevant point of first sale of the basic agricultural product would be the 
point at which Chinese producer s of rice in the relevant provinces sell their product to the 
government or its relevant purchasing entities. This is because, as outlined in Paragraph  7 of Annex 
3, the calculation of AMS is aimed at assessing measures which benefit producers of basic agr icultural 
products. In other words, it is the point at which the measure acts to benefit the producers that is 
relevant here (that is, the point at which the rice producers sell their rice at the AAP). In addition , 
the plain meaning of "point of first sale " indicates that AMS is to be calculated in relation to the first 
instance the commodity is sold.563 The price at the point of first sale for rice would be the "farm -
gate", "paddy" or "unmilled" price of both Indica and Japonica rice.  
7.342.   Mindful of this , and i nterpreting the term "basic agricultural product" holistically in the 
context of the Agreement on Agriculture, we consider that the basic agricultural product , as close as 
practicable to the point of first sale, is unmilled (Indica and Japonica) rice.  
7.343.   The Panel notes that, mathematically, there is no difference in the resulting MPS when only 
the FERP is adjusted  to reflect an unmilled equivalent level , or when both the AAP and QEP are 
adjusted  to reflect  milled equivalent level s if the price and quantity conversion rates applied are the 
same  (that is, for example , if both price and quantity are adjusted at a rate of 70% ). The United 
States argues in this regard that the correct rate to use for adjusting price, based on its calcula tions, 
is not 70% , but 60%.564 
7.344.   Adjustment rate : 𝑟 for quantities and prices  
Calculating MPS at  a milled  level:  
 
𝑀𝑃𝑆 =(𝐴𝐴𝑃
𝑟−𝐹𝐸𝑅𝑃 )∗𝑟𝑄=𝑟𝑄∗𝐴𝐴𝑃
𝑟−𝑟𝑄∗𝐹𝐸𝑅𝑃 =(𝑨𝑨𝑷 −𝒓𝑭𝑬𝑹𝑷 )∗𝑸 
 
 
Calculating MPS at  an unmilled  level:  
 
𝑀𝑃𝑆 =(𝑨𝑨𝑷 −𝒓𝑭𝑬𝑹𝑷 )∗𝑸 
 
7.345.   Finally, China contends that adjustment of the fixed external reference price  is not  legally 
permissible.  China submits that i f any price needs to be adjusted for purposes of calculating AMS, 
so as to permit a proper comparison of prices for the same product at the same level of processing 
and trade, then the AAP must be adjusted, because that price is not "fixed".565  
7.346.   The Panel does not find this argument convincing. As noted by the United States, Paragraph  
9 of Annex 3 states explicitly that "the fixed reference price may be adjusted for q uality differences 
as necessary" .566 This indicates that China's argument regarding the immutable nature of the 
reference price due to the inclusion of the word "fixed" is misplaced. Clearly, on the wording of 
Paragraph  9 itself, the Agreement on Agriculture allows for the adjustment of the FERP and thus  the 
word "fixed" would not act to prevent the adjustment of the FERP if the Panel considers this 
necessary or appropriate.  
7.347.   In light of the above , we consider that in order to properly calculate the relevant AMS for 
Indica and Japonica rice we will adjust the FERP downwards  to a level equivalent to unmilled rice.  
                                                
562 China's response to Panel question No. 99, para. 317.  
563 As noted by the United States. See United States' re sponse to Panel question No. 99, para. 176.  
564 United States' first written submission, para. 116.  
565 China's first written submission, para. 246.  
566 United States' second written submission, paras. 97 -98. WT/DS511/ R 
 
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  This approach ensures calculation of the relevant AMS as close as practicable to the p oint of first 
sale of the basic agricultural product.  
7.4.5.4.2   Adjustment rate to be used in this case   
7.348.   We have determined that the FERP will be adjusted to reflect an unmilled equivalent  level. 
We now move to determine the most appropriate rate at which to adjust the FERP. As noted 
previously there are two potential options  presented by the parties here: a rate of 60%, which the 
United States argues must be applied to the FERP (or to any price -based adjustment)567, or a rate 
of 70% which China initially argues should  apply to both the QEP and the AAP (originally a quantity -
based adjustment, identically applied to price).568 China has stated, however, that "to adjust 
downwards the fixed external reference prices to reflect the processing level of paddy rice,  … the 
conver sion rate should again be 70%, such that the milled rice fixed external reference price would 
have to be multiplied by 0.7" .569 China has provided data for the adjusted  FERP in this regard.570 
The ability to use either of these  adjustment rates depends, first, on the availability of suitable data 
provided by the parties to the Panel.  
7.349.   A major point of contention between the parties is the use, by the United States, of " polished 
long-grained non -glutinous rice a nd polished round -grained rice" in determining its price -based 
adjustment rate.  This rate allegedly results from a n incorrect product comparison, according to 
China .571 China argues that  the necessary adjustment rate is one that flows from a comparison 
between : (i) the rice pr oducts exported by China in 1996 -1998 (and on which the FERP is based) ; 
and (ii) unmilled  rice to which the minimum procurement price applied in 2012 -2015. For China, the 
product on which the 1996 -1998 FERP is based is "semi -milled or wholly milled rice, w hether or not 
polished or glazed", which is a broad category of rice and includes cheaper semi -milled rice and 
broken rice, as well as more expensive forms of rice, such as polished rice  with broken rice removed.  
China contends that the United States  has a ssumed that the product  to use as the proxy for the 
external reference price is the highest quality product  – "polished long -grained non -glutinous rice 
and polished round -grained rice ", which is naturally the most expensive.572 As the 1996 -1998 FERP 
was base d on " semi-milled or wholly milled rice, whether or not polished or glazed ", it would be 
incorrect to compare the price used there with only polished rice (the highest quality product) in the 
current calculations, China argues.  The United States , on the other hand,  in its second written 
submission , argue s that China's contention that polished rice is a significantly more refined product 
than milled rice is inaccurate,  as polished rice is milled rice .573 China's contention  appears to be 
confirmed by Figure 5  of China's first written submission, an OECD overview of rice at various stages 
of processing , reproduced below .574 This problem is exacerbated, according to China, as the 60 % 
rate is based on the use of Chinese retail prices for polished long -grained and p olished round rice575 
while the  external reference price set out in Rev.3 is a wholesale f.o.b. export price.576  
                                                
567 United States' response to Panel question No. 101.  
568 China's response to Panel question No. 101.  
569 China's response to Panel question No. 101.  
570 China's response to Panel question No. 101, table 14.  
571 China's response to Panel question No. 38.  
572 China's first written submission, para. 248 (referring to 2014 China Yearbook of Agricultural Price 
Survey, (Exhibit USA -72)). 
573 United States' second written submission, para. 103 . 
574 China's first written submission, para. 240, Figure 5.  
575 China's first written submission, para. 250 (referring to 2014 China Year book of Agricultural Price 
Survey , (Exhibit USA -72)). 
576 China's first written submission, para. 250.  WT/DS511/ R 
 
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  Figure 3:  OECD overview of rice at various stages of processing  
     Source: China's first written submission, Figure 5 .577 
7.350.   As correctly noted  by China, the wholesale f.o.b. export price,  as set out in Rev.3,  covers 
both polished rice, and unpolished , or broken  rice.578 Restricting that product category to polished 
rice, as the United States suggests, would result in taking as  the basis for adjust ment the most 
expensive type of  rice, leaving out the unpolished or broken rice.  This approach is, in our view, 
incorrect, because it would fail to take into account prices of less expensive types of rice that are 
covered by the wholesale f.o.b. export pri ce mentioned in Rev.3. The so -derived conversion  rate of 
60% would thus  be distorted and  we cannot use it as the basis for our calculations.  
7.351.   China argue s that, under these  circumstances, the use of a volume -based conversion rate 
would be appropriate where no better price -based conversion rate is available .579 We agree that in 
the absence of more accurate price -based data for the conversion , we can complete our calculations 
based  on a less-preferable, but equally valid , volume -based conversion rate .580 
7.352.   We thus c onclude that because of the absence of appropriate price -based conversion data, 
we will make the adjustment to the FERP using the volume -based conversion rate of 70%.  
                                                
577 OECD Environment Directorate, Revised Consensus Document on Compositional Considerations for 
New Varieties of Rice (Oryza sativa): Key Food and Feed Nutr ients, Anti -nutrients and Other Constituents, 
2016, (Exhibit CHN -65). 
578 The United States relied on data attributable to the "rural free market, " which it considers may 
underestimate the differential between paddy rice prices and export milled or semi -milled rice prices because 
they do not account for the transportation, bagging or packaging, and other costs associated with export.  
United States ' second written submission, para. 103.  
579 China's response to Panel question No. 38, para. 171.  
580 While we agree w ith China's suggestion to use the volume -based conversion rate of 70%, this 
conclusion should not be read as endorsing China's argument that the determination of the adjustment rate 
should be consistent with the contents of Rev.3. See China's first written  submission, paras. 234 -235, 243 -
251, China's response to Panel question No. 100. While certain elements of China's CDM found within Rev.3 
could be relevant for Panel's determination of current AMS, we do not consider the fact that China had 
purportedly ut ilized an identical conversion rate in Rev.3 to be binding or determinative when adjusting the 
variables at this stage of our assessment.  
 
WT/DS511/ R 
 
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  7.4.5.4.3   Conclusion on the processing -level adjustment  
7.353.   To summarize the conclusions that we have a rrived at in this section on the processing level 
adjustment , we will (i) adjust the FERP s for Indica and Japonica rice , which is the only variable at a 
higher level of processing than "unmilled" , and (ii)  make the adjustment using the volume -based 
conversion rate of 70% , due to the absence of appropriate price -based conversion data . 
7.4.6   Calculation of China's Current Total AMS  
7.354.   We have resolved the issues before us relating to the definition and calculation of each of 
the variables of the MPS formula. Br iefly, the AAP is the minimum purchase price identified in the 
annual Wheat MPP Notices581 and Rice MPP Notices582 (at Grade 3).583 The FERP to be used in this 
case is based on the same years used to calculate China's Base Total AMS, i.e. 1996 -1998. For Indica 
and Japonica rice, the FERP will be adjusted downward at a rate of 70%  to reflect the level of 
unmilled rice used in the AAP and QEP . The QEP to receive the AAP is the entire volume of production 
in the relevant specified provinces, less any out -of-grade gr ain. Furthermore, the total value of 
production for the various products is calculated by multiplying the total amount of wheat (or rice) 
produced in China in a certain year by the producer price (or farm gate price) of wheat (or rice) for 
that year.584 
7.355.   These legal and technical considerations will guide o ur calculation of China's Current Total 
AMS. 
7.356.   In this section, we will assess the parties' arguments regarding the prices and quantities that 
should inform the calculation of China's domestic support in t he form of market price support for 
rice and wheat, in the years 2012 -2015. After doing so and having established the appropriate 
figures to be used, we will proceed to make our own calculations of the market price support 
component of China's AMS and Curr ent Total AMS for the commodities and in the years at issue. We 
will conclude by assessing whether China is in compliance with its relevant domestic support 
obligations.  
7.357.   We begin by addressing the general framework we will use to review the numbers and 
supporting evidence that have been presented over the course of these proceedings. In this regard, 
we note that in contrast to the findings in the previous sections in relation to the legal definition of 
the AAP, the FERP and the QEP, the present assessment is mainly factual in nature.  
7.358.   In this connection, we asked the parties h ow the Panel is to assess the calculations presented 
by them, including the extent to which we can or should re -run the numbers presented by the 
parties. We also asked them how we shou ld treat any discrepancies or inconsistencies in the data 
presented by them. For the United States, the Panel should review the calculations, along with the 
relevant source material underlying these c alculations . The United States also argues that  the Pane l 
should seek to resolve any discrepancies in the calculations by re course to the source material, and 
that, as the trier of fact,  the Panel should seek to resolve any discrepancies by evaluating the 
respective pieces of evidence to determine their reliabi lity and probative value.585 China generally 
agrees with the United States and posits that in its role as trier of fact, the Panel may make factual 
                                                
581 2012 Wheat Annual Notice, (Exhibit USA -20/CHN -18B), p. 1; 2013 Wheat Annual Notice (Exhibit 
USA-21/CHN -93B) p. 1; 2014 Wheat Annual Notice, (Exhibit USA -22/CHN -20B), p. 1; 2015 Wheat Annual 
Notice, (Exhibit USA -23/CHN -21B), p. 1.  
582 2012 Rice Annual Notice, (Exhibit USA -39/CHN -23B), p. 1; 2013 Rice Annual Notice, (Exhibit USA -
40/CHN -24B), p. 1; 2014 Rice Annual Notice, (Exhibit  USA-41/CHN -25B), p. 1; 2015 Rice Annual Notice, 
(Exhibit USA -42/CHN -26B), p. 1.  
583 These figures were multiplied by 20 in order to derive a price per ton.  
584 Both the United States and China use the same source to determine the producer pric e (or farm gate 
price) for wheat and rice. China's Farm Gate Prices 1995 to 2015, (Exhibit USA -79), Agricultural Product Cost 
and Returns 2010 -2016, (Exhibit USA -81/CHN -67); China National Development and Reform Commission, 
Compilation of Materials on Agri cultural Product Cost and Returns (2016), (Exhibit USA -81/CHN -67). Prices are 
available for early -, mid-, and late -season Indica rice, and Japonica rice. It appears that the United States has 
used the producer price for  mid-season Indica  rice only as the p roducer price for mid- to late -season Indica 
rice in its calculations , as noted by China. China's comments on the United States' response to Panel question 
No. 96.  
585 United States' response to Panel's question No. 63 (second substantive meeting).  
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  findings that differ from th ose advocated by the parties, provided that the Panel's findings have an 
evidentia ry basis in the record, and they are otherwise consistent with the requirement to make an 
objective assessment. In addition, China argues that the Panel's mandate extends to an objective 
assessment of any discrepancies in the data, and to making factual fi ndings that resolve any such 
discrepancies.586 
7.359.   We note that under Article 11 of the DSU, we are directed to make an objective assessment 
of the facts of the case and the applicability of and conformity with the relevant covered agreements. 
In our view and in  the context of this case, this implies that we should not accept the calculations 
and numbers presented by the parties before carefully examining their accuracy and reliability. In 
addition, our task allows us to resolve any inconsistencies or discrepanci es that we find by resort ing 
to the original sources of the data and by running our own calculations on the basis of the available 
evidence in the record. In this vein, we asked the parties several questions that sought to clarify 
certain inconsistencies i n the numbers presented in the parties' written submissions.587 The parties 
clarified that most of these inconsistencies were due to differences in the units of measurement 
used, the number of decimal places, rounding, and some errors in the transposition of  numbers 
when aggregating them across different tables.  
7.360.   After carefully assessing each of these issues and the evidence before us, we decided to 
standardize the metrics to be used into millions of tons, for quantities, and renminbi per ton, for 
prices. We  also decided to work with all the decimal places available so as to avoid any inaccuracies 
resulting from rounding. Finally, we ran our own calculations to either confirm or correct the ones 
presented by the parties. After doing so, we presented the parti es with a table that summarized our 
assessment regarding the different figures needed for the calculations of China's Total AMS and 
Current Total AMS.588 The parties agreed with most of the numbers presented but, in some instances, 
they submitted additional corrections or revisions. We have taken due note of these.  
7.361.   The tables below present  the resulting information.  
7.4.7   MPS Calculations  
7.4.7.1   Wheat  
7.362.   Table 9  sets out all the variables required to run the MPS formula and derive a percentage 
to compare against China's 8.5% de minimis  level, namely the AAP, the FERP, the QEP and the total 
value of production. First, we multiply the total national production  of wheat by the producer 
price for each year, t o calculate the total value of production  of wheat.  
7.363.   The table then determines the QEP. This is done by (i) setting out the volume of production  
of wheat in each of the covered  provinces and then (ii) subtracting the out-of-grade production  
from each of th ese provinces. The QEP per province  is then totalled to determine the final QEP.  
7.364.   The AAP is the price set out in the relevant measures , multiplied by 20 to obtain a price 
expressed in renminbi/ton.  
7.365.   The FERP  is the average of three external reference prices for the years 19 96-1998, set out 
in Appendix DS 5-3 of China's tables of supporting material.   
7.366.   To calculate an MPS value, first the FERP is subtracted from the AAP. The resulting price 
differential is multiplied by the QEP. The resulting monetary value is the MPS for a specific year.  
Finally, this MPS is divided by the  total value of production  above to arrive at a percentage  
which is then  compared to China's 8.5% de minimis level.  
                                                
586 United States' response to Panel's question No. 63 (second substantive meeting).  
587 See United States' response to Panel's question Nos. 72 -74 (first substantive meeting).  
588 See United States' response to Panel's question No. 96. See also (Exhibit CHN -88). 
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  Table 9: Calculation of MPS for wheat from 2012 -2015  
Wheat MPS Calculation  Units  2012  2013  2014  2015  
Total national production589 million tons  121.023  121.926  126.208  130.185  
Producer price590 ¥/ton  2,166.20  2,356.20  2,411.80  2,328.60  
Total value of production  million ¥  262,160.02  287,282.04  304,388.45  303,148.79  
Volume of production by  
covered  province591           
Hebei  million tons  13.377  3.872  14.299  14.350  
Jiangsu  million tons  10.488  11.013  11.604  11.740  
Anhui  million tons  12.940  13.320  13.936  14.110  
Shandong  million tons  21.795  22.188  22.638  23.466  
Henan  million tons  31.774  32.264  33.290  35.010  
Hubei  million tons  3.708  4.168  4.216  4.209  
Total  million 
tons 94.082  96.825  99.983  102.885  
Out-of-grade percentage592           
Hebei  percentage  0.0 1.0 0.0 0.0 
Jiangsu  percentage  2.0 1.0 0.3 1.0 
Anhui  percentage  1.0 0.0 0.0 1.7 
Shandong  percentage  0.0 1.0 0.2 0.0 
Henan  percentage  1.0 0.0 0.0 0.0 
Hubei  percentage  8.0 0.0 0.0 0.0 
QEP per provinces            
Hebei  million tons  13.377  13.733  14.299  14.350  
Jiangsu  million tons  10.278  10.903  11.569  11.623  
Anhui  million tons  12.811  13.320  13.936  13.870  
Shandong  million tons  21.795  21.966  22.593  23.466  
Henan  million tons  31.456  32.264  33.290  35.010  
Hubei  million tons  3.411  4.168  4.216  4.209  
MPS Calculation       
QEP million 
tons 93.128  96.354  99.903  102.528  
AAP593 ¥/ton  2,040.00  2,240.00  2,360.00  2,360.00  
Average 1996 -1998  FERP 
(c.i.f price)594 ¥/ton  1698.13  1698.13  1698.13  1698.13  
Wheat MPS 
= (AAP -FERP)*QEP  million 
RMB 31,837.83  52,211.49  66,122.74  67,860.03  
                                                
589 China 's first written submission, para. 87, Table 4. China's Rural Statistical Yearbook (2013), (Exhibit 
CHN-49), p. 152 ; China's Rural Statistical Yearbook (2015), (Exhibit CHN -50), p. 164; China's Rural Statistical 
Yearbook (2016), (Exhibit USA -76/CHN -33), p.  168; United States' first written submission, para. 122; United 
States' response to Panel question Nos. 72 -73; China's Statistical Yearbook, Table 12 -10, (2016), (Exhibit 
USA-18); China's Statistical Yearbook, Table 12 -10 (2015), (Exhibit USA -73); China's  Statistical Yearbook, 
Table 12 -10 (2014), (Exhibit USA -74); China's Statistical Yearbook, Table 13 -15 (2013), (Exhibit USA -75) 
China's Rural Statistical Yearbook (2016), Table 7 -17 (Exhibit USA -76/CHN -33). 
590 China's first written submission, para. 272, Ta ble 21; Agricultural Product Cost and Returns 2010 -
2016, (Exhibit USA -81/CHN -67). United States' first written submission, para. 122; China's Farm Gate Prices 
1995 to 2015 (Exhibit USA -79). 
591 United States' response to Panel Question No. 73, Table 8 (first  substantive meeting).  China's 
Statistical Yearbook, Table 12 -10, (2016), (Exhibit USA -18); China's Statistical Yearbook, Table 12 -10 (2015), 
(Exhibit USA -73); China's Statistical Yearbook, Table 12 -10 (2014), (Exhibit USA -74); China's Statistical 
Yearbook , Table 13 -15 (2013), (Exhibit USA -75). 
592 China's response to Panel question No. 93, Table 6 ; United States' response to Panel question No. 
93, China's States Administration of Grain, Standard & Quality Centre, Quality Survey Reports 2010 -2016 
(Exhibit USA -98). 
593 China's first written submission, para. 270, Table 20; 2012 Wheat Annual Notice, (Exhibit USA -
20/CHN -18B); 2013 Wheat Implementation Plan, (Exhibit USA -25/CHN -19B Revised); 2014 Wheat Annual 
Notice, (Exhibit USA -22/CHN -20B); 2015 Wheat Annual Notic e, (Exhibit USA -23/CHN -21B). United States' first 
written submission, para 111, Table 6; 2013 Wheat Annual Notice  (Exhibit USA-21/CHN -93B). 
594 WT/ACC/CHN/38/Rev.3, Appendix DS 5 -3, (Exhibit USA -43). WT/DS511/ R 
 
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  Wheat MPS Calculation  Units  2012  2013  2014  2015  
MPS / Total value of 
production  percentage  12.14  18.17  21.72  22.39  
 
7.4.7.2   Rice 
7.367.   The calculations for rice (Japonica, early-season Indica and late-season Indica) are relatively 
more complex . This is mainly due to differences in the mathematical approaches taken by the parties  
and differences in the data submitted by the parties responding to the mentioned mathematical 
differences . 
7.368.   There are three discrete issues in this regard:  (i) the different ratios used by the United 
States (31.6%) and China (33.3%) to determine the proportion of Japonica rice that makes up the 
national production of rice in China; (ii) differences between the data submitted by the parties, or 
lack thereof, regarding the provincial breakdown of Japonica and Indica rice in the covered provinces 
in order to determ ine the QEP; and (iii) China's use of a weighted average to determine the AAP for 
Indica rice  that was used in the calculation of the MPS Formula . 
7.369.   We explore each of these  issues  below . 
7.4.7.2.1   Total value of production of rice  
7.370.   China's Statistical Yearbook annually  provides information on total "rice" production by 
province595, and as noted by both parties, China's Rural Statistical Yearbooks596 do not distinguish 
between Indica and Japonica rice.597 Though both parties agree on the total volume of national rice 
production, they have differing views on the proportion s of national rice production which constitute 
Japonica and Indica rice.  
7.371.   The United States argues that Japonica rice  makes up 31.6% of Ch ina's rice production  and 
that th e total volume of production of Japonica is thus determined by multiplying  the total national 
rice production by 0.316.598 China argues that "[r] eflecting the reality of Chinese agricultural 
production, japonica rice makes up  one third  of China 's total rice production. "599 China notes that 
this proportion has been used in a number of its notifications.600  
7.372.   We have carefully reviewed the evidence presented by the parties to support their respective 
asser tions. Regarding the United States ' position , we note that the process by which the United 
States arrives at 31.6% is not itself entirely clear as we could not identify the precise origin of the 
data within the exhibits referenced  by the United States. Upon examination of the portion  of China' s 
Statistical Yearbook (2016)  submitted by the United States601, we note that it contains  multiple years 
detailing several stages of the production of rice as well as a breakdown of production of these 
products per province, without indicating the year (or years) to which the breakdown refers  to. 
Without a reference to those years for each province, it is unclear as to whether the 31.6% ratio is 
meant to apply uniformly to the years 2012 -2015. We were thus unable to replicate precisely the 
results obtained by the United States.  Regarding China's arguments , we observe that the 1:2 ratio 
is supported by notifications that China has made to the WTO Committee on Agriculture . These , 
however,  do not explain the calculation process used to arrive at this fi gure or provide any statistical 
data on the production of Japonica vs. Indica rice in China.  
                                                
595 China's Statistical Yearbook, Table 12 -10, (2016), (Exhibit USA -18); China's Statistical Yearbook, 
Table 12 -10, (2015), (Exhibit USA -73); China's Statistical Yearbook, Table 12 -10 (2014), (Exhibit USA -74); 
China's Statistical Yearbook, Table 13 -15 (2013), (Exhibit USA -75). 
596 China's Rural Statistical Yearb ook (2013), (Exhibit CHN -49); China's Rural Statistical Yearbook 
(2015), (Exhibit CHN -50); China's Rural Statistical Yearbook (2016), (Exhibit USA -76/CHN -33). 
597 United States' first written submission, para. 120; China's response to Panel question No. 97, 
para. 305; China's comments on the United States' response to Panel question No. 97, para 239.  
598 United States' first written submission, fn. 244.  
599 China's first written submission, para. 257 . 
600 See China's Notification (2002 -2004), G/AG/N/CHN/17  (24 March 2010), (Exhibit USA -2); China's 
Notification (2005 -2008), G/AG/N/CHN/21 (13 October 2011); and China's Notification (2009 -2010), 
G/AG/N/CHN/28 (6 May 2015).  
601 China's Statistical Yearbook, Table 12 -10, (2016), (Exhibit USA -18). 
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  7.373.   We note that b oth parties agree on the fact that Japonica rice production is (roughly) one 
third of national rice production.602 Additionally, the difference in the  overall results obtained using 
each of the two approaches is minimal, as will be discussed below.  
7.4.7.2.2   Volume of production of rice per province  
7.374.   According to the United States, additional  information regarding crop production by season  
is available in China 's Rural Statistical Yearbook and Agricultural Statistical Reports regarding 
production volume by provin ce for early season rice, mid -to-late or single season rice, and late 
season rice.603 In this regard, the United States argues that nearly all early season and late season 
rice is Indica rice, while middle season single crop rice is Japonica rice .604  
7.375.    In order to determine the production of early-season Indica rice, mid-late-season Indica 
rice and Japonica rice  on a provincial basis, the United States  attempts  to identify  those provinces 
that primarily or only grow Japonica or Indica rice . Accordingly, the United States submits that 
almost al l of the rice reported as early -season rice is Indica rice.605 The United States goes on to 
state that in the more temperat e northeast provinces of Liaoning, Jilin, and Heilongjiang, farmers 
grow primar ily Japonica rice, and the measures for Japonica rice operate  only in those three 
provinces .606 The southern provinces of Jiangxi, Henan, Hubei, Hunan, Guangxi Zhuang and Sichuan 
primarily grow Indica rice607, and  Jiangsu and Anhui provinces grow both Indica rice and Japonica 
rice.608 For the  provinces which  grow both mid -late-season Indica rice  and Japonica rice609, the total 
rice volume has been subdivided  by the United States  to refle ct the portion of production estimated 
to be attributed to each species.610  
7.376.    China disagree s with  the data provided by the U nited States concerning the division of 
Indica and J aponica rice production in the MPP provinces , as "the United States' division is not based 
on any official source ".611 As a result, China characterises the production data provided by the United 
States for the different types of rice per province as being a rough estimation by the United States, 
based on elements from three r eports, dated 2001612, 2006613 and 2011614, respectively. In addition, 
China argues that the United States does not appear to have applied  the percentage that it had itself 
                                                
602 See United States' f irst written submission, fn. 244.  
603 United States' first written submission, para. 120.  
604 United States' first written submission, fn. 234.  
605 China's Rural Statistical Yearbook (2016), Table 7 -18, (Exhibit USA -76/CHN -33); China Agricultural 
Statistical Rep orts (2011 -2014), (Exhibit USA -77) pp. 5, 11, 19.  
606 United States' first written submission, para. 121; China's Rural Statistical Yearbook (2016), Table 7 -
17, and 7 -18, (Liaoning, Jilin, and Heilongjiang reporting no early (Indica) rice production, and onl y a single 
season of mid -late-season  rice), (Exhibit USA -76/CHN -33); see also Funing, et al., Alternative Approach to 
Measure Comparative Advantage in China's Grain Sector  (2001) , p. 7, (Exhibit USA -35) and Chen, Current 
Situation and Trends in Production of Japonica Rice in China (2006), p. 2 (2006) (discussing three northeast 
provinces and Jiangsu), (Exhibit USA -36). 
607 United States' first written submission, para. 121; China's Rural Statistical Yearbook (2016), Table 7 -
17, and 7 -18 (2016), (Exhibit USA -76/CHN -33); Chen, Current Situation and Trends in Production of Japonica 
Rice in China  (2006), p. 4  (2006) (noting the difficulty of the southern provinces switching to Japonica rice) 
(Exhibit USA -36); see also  Hansen, et al., China's Japonica Rice Market , 32 (2002)  (Exhibit USA -34). 
608 United States' first written submission, para. 121.  
609 According to the United States, Anhui and Jiangsu both grow both Japonica and mid -late-season 
Indica rice, however in different proportions. Jiangsu is a major producer of Japonica and 86 percent of its 
production is estimated to be Japonica. Anhui is a lesser producer of Japonica and 19 percent of its production 
is estimated to be Japonica.  United States' first written submission, fn. 231;  See Yuzhu, Basic Knowledge about 
Japonica Rice  (2011), p. 7 (Exhibit USA -78), compare with China Agricultural Statistical Reports (2011 -2014), 
(Exhibit USA -77). 
610 United States' first written submission, para. 121; Yuzhu, Basic Knowledge about Japonica Rice  
(2011), p. 7, (Exhibit USA -78). Compare with China Agricultural Statistical Reports (2011 -2014), (Exhibit USA -
77). 
611 China's response to Panel question No. 96, para. 305; China's comments on the United States' 
response to Panel question No. 97, paras. 239 -240. 
612 Funing, et al., Alternati ve Approach to Measure Comparative Advantage in China's Grain Sector 
(2001) , p. 7 (Exhibit USA -35) 
613 Chen, Current Situation and Trends in Production of Japonica Rice in China  (2006), p. 2 (2006) 
(Exhibit USA -36) 
614 Yuzhu, Basic Knowledge about Japonica Ric e (2011), p. 7 (Exhibit USA -78) 
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  identified from  the three reports615, for the data it submitted to the Panel.616 China thus s tates that 
it is not in a position to confirm the accuracy of these data, let alone to agree with them.  
7.377.   We agree with China that China's Statistical Yearbooks do not distinguish between Indica 
and Japonica rice when reporting production values. We also ag ree with China that the evidence 
provided by the United States does not refer to the years at issue in this dispute, i.e. 2012 -2015, 
and that it is not sourced from official reports.  In this connection, we  have not been able to determine 
how the United Sta tes has arrived at its proportions of Japonica rice in various provinces from the 
evidence provided – the relevant information  to do this  does not seem to be present in the exhibits 
provided by the United States.  We note, however, that China did not submit  any evidence to support 
its contention of the inaccuracy of the United States' calculation, nor did it provide any alternative 
proportions to be used by the Panel.  The evidence  on the record does not contain any other source 
with more recent or of ficial data on the breakdown of the two types of rice by province .  
7.378.   Given the above, particularly the differences between the parties' approaches when 
determining the total proportion of Japonica rice produced in China,  the Panel will conduct  two sets 
of calculat ions: one set will broadly follow the United States' approach , using the data  provided by 
the United States , where available, for the volumes of rice used to determine the total value of 
production and the QEP, and the other set of calculations will broadl y follow China's approach  and 
will use the data provided by China, where available, for the volumes of rice used to determine the 
total value of production  and the QEP .  
7.4.7.2.3   Weighted average AAP  
7.379.   The third and final issue relates to the use of a weighted averag e to calculate one single AAP 
value for Indica rice when running the MPS Formula . 
7.380.   China argues that , given there are separate AAPs for early -season and mid -late-season 
Indica rice, a weighted average AAP should be determined for Indica rice as a whole.617 The weight 
China assigns to each type of rice for each year is the actual purchased amount in the respective 
year.618  
7.381.   We agree with China that its measures provide for two separate AAP values: one for early -
season and the other for mid -late-season Indica rice. However, we are not  persuaded tha t a 
weighted average  is the best approach. This is so because China bases its weighting of the AAP on  
the amount of rice purchased, and not the QEP as defined  by the Panel.619 In our view, a  simple 
average of the two AA Ps is suitable  to determine an AAP for Indica rice as a whole. Thus, the Panel 
will not use  China's weighted average  approach for the  AAPs for Indica rice.  It will instead use a 
simple average  where necessary . 
                                                
615 Hansen, et al., China's Japonica Rice Market , p. 38  (2002),  (Exhibit USA -34); Chen, Current 
Situation and Trends in Production of Japonica Rice in China  (2006), p. 7  (2006), (Exhibit USA -36), Yuzhu, 
Basic Knowledge about J aponica Rice  (2011), p. 7, (Exhibit USA -78). 
616 China's comments on the United States' response to Panel question No. 97, para. 240.  
617 China's first written submission, para. 237, Table 10.  
618 China's first written submission, para. 237.  
619 In any event, if the Panel were to consider that China had meant for the weight to derive from a 
variable QEP (however defined), rather than a static "amount purchased", the Panel notes that the results 
would be mathematically equivalent in this case, if t he other data inputs remained constant. See the formula 
below:  
 
Summed MPS for early - and mid -late-season Indica rice:  
𝑀𝑃𝑆𝑖𝑛𝑑 =𝑀𝑃𝑆𝑒 +𝑀𝑃𝑆𝑚𝑙 =(𝐴𝐴𝑃𝑒 −𝐹𝐸𝑅𝑃𝑖𝑛𝑑 )∗𝑄𝐸𝑃𝑒 +(𝐴𝐴𝑃𝑚𝑙 −𝐹𝐸𝑅𝑃𝑖𝑛𝑑 )∗𝑄𝐸𝑃𝑚𝑙  
China uses the following weighted  average AAP in its calculation of MPS for Indica rice:  
𝑀𝑃𝑆𝑖𝑛𝑑 =(𝐴𝐴𝑃𝑒 ∗𝑄𝐸𝑃𝑒 +𝐴𝐴𝑃𝑚𝑙 ∗𝑄𝐸𝑃𝑚𝑙
𝑄𝐸𝑃𝑒 +𝑄𝐸𝑃𝑚𝑙−𝐹𝐸𝑅𝑃𝑖𝑛𝑑 )∗(𝑄𝐸𝑃𝑒 +𝑄𝐸𝑃𝑚𝑙 ) 
Both methodologies used in this case are mathematically equivalent.  
𝑀𝑃𝑆𝑖𝑛𝑑 =𝑀𝑃𝑆𝑒 +𝑀𝑃𝑆𝑚𝑙 =(𝐴𝐴𝑃𝑒 −𝐹𝐸𝑅𝑃𝑖𝑛𝑑 )∗𝑄𝐸𝑃𝑒 +(𝐴𝐴𝑃𝑚𝑙 −𝐹𝐸𝑅𝑃𝑖𝑛𝑑 )∗𝑄𝐸𝑃𝑚𝑙  
=𝐴𝐴𝑃𝑒 ∗𝑄𝐸𝑃𝑒 +𝐴𝐴𝑃𝑚𝑙 ∗𝑄𝐸𝑃𝑚𝑙 −𝐹𝐸𝑅𝑃𝑖𝑛𝑑 ∗(𝑄𝐸𝑃𝑒 +𝑄𝐸𝑃𝑚𝑙 ) 
=(𝑨𝑨𝑷𝒆 ∗𝑸𝑬𝑷𝒆 +𝑨𝑨𝑷𝒎𝒍 ∗𝑸𝑬𝑷𝒎𝒍
𝑸𝑬𝑷𝒆 +𝑸𝑬𝑷𝒎𝒍−𝑭𝑬𝑹𝑷𝒊𝒏𝒅 )∗(𝑸𝑬𝑷𝒆 +𝑸𝑬𝑷𝒎𝒍 ) 
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  7.4.7.2.4   Conclusion on these  issues  
7.382.   For the reasons out lined above, we will conduct two sets of calculations:  
a. In the first set of calculations , we broadly follow the United States' approach. This involves 
using the United States' national breakdown of Japonica and Indica rice ( at a 31.6% ratio), 
as well as the  United States' breakdown in the covered provinces. For the calculation of 
MPS for Indica rice, specifically, w e will calculate two different MPS values , one for early -
season and the other for mid - late-season, using the two  separate  AAPs in China's 
measures. Finally , we will add them up  to arrive at an MPS for Indica rice as a whole. This 
MPS value is then divided by the total value of production of all Indica rice in China (a sum 
of early - and mid -late-season based on the United States' 31.6% ratio).  
b. In the second set of calculations , we broadly follow China's approach. This involves using 
China's national breakdown of Japonica and Indica rice ( at a 33.3% ratio), as well as a 
proxy breakdown of rice production in the covered provinces. For the calculation of MPS 
for Indica rice, specifically, w e will calculate one MPS  value  for Indica rice, using a simple 
average of the early - and mid -late-season AAPs. This MPS value is then divided by the 
total value of production of all Indica rice in Ch ina (based on China's 33.3% ratio).  
7.383.   As will be seen below, in either set of calculations , the result is above China's 8.5% de 
minimis  level for both Indica and Japonica rice , and the average difference between the United 
States' and China's alternatives is approximately 0.27  percentage points  for Indica  and 0.25 
percentage points  for Japonica. In our view, this difference is negligible and does not affect our final 
conclusion regarding China's compliance with its domestic support commitments.  
7.4.7.2.5   Japonica rice  
7.4.7.2.5.1   Japonica rice ( United States'  approach ) 
7.384.   Table 10  sets out all the variables required to carry out the MPS formula and derive a 
percentage to compare against China's 8.5% de minimis  level, namely the AAP, the FERP, the QEP 
and the total value of production.  First, it sets out the total national production  of Japonica rice (the 
total national production of all rice in China multiplied by 0.316 , which the United States  argues is 
necessary to arrive at  the correct proportion of Japonica) . It goes on to multiply this total national 
production  of Japonica rice  by the producer price for each year, to calculate the total value of 
production  of Japonica rice.  
7.385.   The table then determines the QEP. This is done by (i) setting out the volume of prod uction  
of Japonica rice in each of the covered  provinces, as provided exclusively by the United States, and 
then (ii) subtracting the out-of-grade production  from each of these provinces. The QEP per 
province  is then totalled to determine the final QEP.  
7.386.   The AAP is the price set out in the relevant measures, multiplied by 20 to obtain a price 
expressed in renminbi/ton.  
7.387.   The FERP  is the average of three external reference prices for the years 1996 -1998, as set 
out in Appendix DS 5-4 of China's tables of supporting material. We adjust  this FERP  downwards to 
the level of unmilled rice by multiplying it by 0.7, as discussed earlier . 
7.388.    To calculate an MPS value, the adjusted FERP is subtracted from the AAP. The resulting 
price differentia l is multiplied by the QEP. The resulting monetary value is the MPS for a specific 
year. Finally, this MPS  is divided by the  total value of production  above to arrive at a percentage  
which can be compared with China's 8.5% de minimis level.  WT/DS511/ R 
 
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  Table 10: Calculation of MPS for Japonica rice from 2012 -2015  
(United  States'  breakdown)  
Japonica rice MPS 
Calculation (US)  Units  2012  2013  2014  2015  
Total national production620 million tons  64.539  64.341  65.256  65.760  
Producer price621 ¥/ton  2,919.60  2,936.60  3,035.20  2,951.20  
Total value of production  million ¥  188,426.83  188,944.93  198,065.65  194,070.65  
Average 1996 -1998 FERP 
(f.o.b. prices - milled)622 ¥/ton  3290.63  3290.63  3290.63  3290.63  
Volume of p roduction by 
covered  province623           
Liaoning  million tons  5.078  5.069  4.515  4.677  
Jilin million tons  5.320  5.633  5.876  6.301  
Heilongjiang  million tons  21.712  22.206  22.510  21.997  
Jiangsu  million tons  16.360  16.551  16.461  16.811  
Anhui  million tons  2.422  2.364  2.431  2.592  
Total  million tons  50.892  51.823  51.793  52.378  
Out-of-grade percentage624           
Liaoning  percentage  0.0 0.0 0.0 0.0 
Jilin percentage  0.0 0.0 0.0 0.0 
Heilongjiang  percentage  0.0 0.0 0.0 0.3 
Jiangsu  percentage  0.0 0.0 0.0 1.5 
Anhui  percentage  0.0 0.0 0.0 0.0 
QEP per province            
Liaoning  million tons  5.078  5.069  4.515  4.677  
Jilin million tons  5.320  5.633  5.876  6.301  
Heilongjiang  million tons  21.712  22.206  22.510  21.931  
Jiangsu  million tons  16.360  16.551  16.461  16.559  
Anhui  million tons  2.422  2.364  2.431  2.592  
MPS Calculation       
QEP million 
tons 50.892  51.823  51.793  52.060  
AAP (unmilled)625 ¥/ton  2,800.00  3,000.00  3,100.00  3,100.00  
Average 1996 -1998  FERP 
(unmilled  equivalent ) ¥/ton  2303.44  2303.44  2303.44  2303.44  
Japonica MPS 
= (AAP -adjusted  FERP)*QEP  million 
RMB  25,270.76   36,097.66   41,256.06   41,468.62  
MPS / Total value of 
production  percentage   13.41   19.10   20.83   21.37  
 
 
                                                
620 United States' response to Panel question No. 73, Table 9 (first substantive meeting); China's 
Statistical Yearbook, Table 12 -10, (2016), (Exhibit USA -18); China's Statistical Yearbook, Table 12 -10 (2015), 
(Exhibit USA -73); China's Statistical Yearbook, T able 12 -10 (2014), (Exhibit USA -74); China's Statistical 
Yearbook, Table 13 -15 (2013), (Exhibit USA -75). 
621 China's first written submission, para. 258, Table 15; Agricultural Product Cost and Returns 2010 -
2016, (Exhibit USA -81/CHN -67). United States' first  written submission, para. 122; China's Farm Gate Prices 
1995 to 2015 (Exhibit USA -79). 
622 WT/ACC/CHN/38/Rev.3, Appendix DS 5 -3, (Exhibit USA -43). 
623 United States' response to Panel question No. 73, Table 8 (first substantive meeting); China's 
Statistical Y earbook, Table 12 -10, (2016), (Exhibit USA -18); China's Statistical Yearbook, Table 12 -10 (2015), 
(Exhibit USA -73); China's Statistical Yearbook, Table 12 -10 (2014), (Exhibit USA -74); China's Statistical 
Yearbook, Table 13 -15 (2013), (Exhibit USA -75). 
624 China's response to Panel question No. 93, Table 6 ; United States' response to Panel question No. 
93, China's States Administration of Grain, Standard & Quality Centre, Quality Survey Reports 2010 -2016 
(Exhibit USA -98). 
625 China's first written submission, Ta ble 8; 2012 Rice Annual Notice, (Exhibit USA -39/CHN -23B); 2013 
Rice Annual Notice, (Exhibit USA -40/CHN -24B); 2014 Rice Annual Notice, (Exhibit USA -41/CHN -25B); 2015 
Rice Annual Notice, (Exhibit USA -42/CHN -26B); United States' first written submission, para . 112, Table 6.  WT/DS511/ R 
 
- 107 - 
 
  7.4.7.2.5.2   Japonica rice ( China 's approach ) 
7.389.   Table 11  sets out all the variables required to run the MPS formula and derive a percentage 
to compare against China's 8.5% de minimis  level, broadly using China's approach . First, it sets out 
the total national production  of Japonica rice (the total national production of all rice in China 
multiplied by 0.333, which China argues is necessary to arrive at  the correct proportion of Japonica) . 
It goes on to multiply this total national production  of Japonica rice  by the producer price for 
each year, to calculate the total value of production  of Japonica rice .  
7.390.   The table then determines the QEP. While China does provide the percentage of out-of-
grade production  in each province, it did not provide data on production by province . Thus, in 
the case of Japonica rice, the table first sets out the data on the total volume of production  of 
Japonica rice in all of the covered provinces , without any provincial breakdown . This value was 
arrived at by multiplying the total volume of production of all rice in the covered provinces by 0.333. 
The table then averages the per centages of out-of-grade production  provided by China into a 
single figure.  Calculating the QEP involves (i) setting out the total volume of production  of Japonica 
rice in all of the covered provinces and then (ii) subtracting the out-of-grade production  
(calculated using the average  of the out -of-grade percentages ) from this total.  The result is the final 
QEP. 
7.391.   The AAP is the price set out in the relevant measures, multiplied by 20 to obtain a price 
expressed in renminbi/ton.   
7.392.   The FERP  is an average of thre e external reference prices for the years 1996 -1998, as set 
out in Appendix DS 5-4 of China's tables of supporting material . We adjust  this FERP  downwards to 
the level of unmilled rice by multiplying it by 0.7.  
7.393.   To calculate an MPS value, first the  adjusted  FERP is subtracted from the AAP. The resulting 
price differential is multiplied by the QEP to arrive at an MPS for a specific year, expressed as a 
monetary value. Finally, this MPS is divided by the total value of production  above to arrive at a 
percentage  which can be compared with China's 8.5% de minimis level.  
  WT/DS511/ R 
 
- 108 - 
 
  Table 11: Calculation of MPS for Japonica rice from 2012 -2015 ( China's breakdown ) 
Japonica rice MPS 
Calculation (China)  Units  2012  2013  2014  2015  
Total national production626 million tons 68.011  67.803  68.767  69.339  
Producer price627 ¥/ton  2,919.60  2,936.60  3,035.20  2,951.20  
Total value of production  million ¥  198,563.71  199,109.69  208,721.09  204,633.04  
Average 1996 -1998 FERP 
(f.o.b. prices - milled)628 ¥/ton  3290.63  3290.63  3290.63  3290.63  
Volume of productio n629      
Total  in covered provinces  million tons  53.059  53.309  53.966  54.659  
Out-of-grade percentage630           
Liaoning  percentage  0.0 0.0 0.0 0.0 
Jilin percentage  0.0 0.0 0.0 0.0 
Heilongjiang  percentage  0.0 0.0 0.0 0.3 
Jiangsu  percentage  0.0 0.0 0.0 1.5 
Anhui  percentage  0.0 0.0 0.0 0.0 
Average  percentage  0.0 0.0 0.0 0.4 
MPS Calculation       
QEP million tons  53.059  53.309  53.966  54.462  
AAP (unmilled)631 ¥/ton  2,800.00  3,000.00  3,100.00  3,100.00  
Average 1996 -1998 FERP 
(unmilled  equivalent)  ¥/ton  2303.44  2303.44  2303.44  2303.44  
Japonica MPS 
= (AAP -adjusted  FERP)*QEP  million RMB  26,347.09  37,132.90  42,987.41  43,382.13  
MPS / Total value of 
production  percentage  13.27  18.65  20.60  21.20  
 
  
                                                
626 Production amount of Japonica rice = national total * 33.3%; See China's first written submission, 
Table 5; China's Rural Statistical Yearbook (2013), (Exhibit CHN -49), p. 152 ; China's Rural Statistical Yearbook 
(2015), (Exhibit CHN -50), p. 164; China's Rural Statistical Yearbook (2016), (Exhibit USA -76/CHN -33), p. 168; 
China's Rural Statistical Yearbook (2016), (Exhibit USA -76/CHN -33), p. 167.  
627 China's first written submission, para. 258, Table 15; Agricultural Product Cost and Returns 2 010-
2016, (Exhibit USA -81/CHN -67). United States' first written submission, para. 122; China's Farm Gate Prices 
1995 to 2015 (Exhibit USA -79). 
628 WT/ACC/CHN/38/Rev.3, Appendix DS 5 -3, (Exhibit USA -43). 
629 These figures were arrived at by taking the total pro duction of rice in the provinces covered by the 
measures and multiplying this by 0.333. China's Rural Statistical Yearbook (2013), (Exhibit CHN -49), p. 152 ; 
China's Rural Statistical Yearbook (2015), (Exhibit CHN -50), p. 164; China's Rural Statistical Year book (2016), 
(Exhibit USA -76/CHN -33), p. 168; China's Rural Statistical Yearbook (2016), (Exhibit USA -76/CHN -33), p. 167.  
630 China's response to Panel question No. 93, Table 6 ; United States' response to Panel question No. 
93, China's States Administration of Grain, Standard & Quality Centre, Quality Survey Reports 2010 -2016 
(Exhibit USA -98). 
631 China's first written submission, Table 8; 2012 Rice Annual Notice, (Exhibit USA -39/CHN -23B); 2013 
Rice Annual Notice, (Exhibit USA -40/CHN -24B); 2014 Rice Annual Noti ce, (Exhibit USA -41/CHN -25B); 2015 
Rice Annual Notice, (Exhibit USA -42/CHN -26B); United States' first written submission, para. 112, Table 6.  WT/DS511/ R 
 
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  7.4.7.2.6   Indica rice  (United States' approach)  
7.4.7.2.6.1   Early -season Indica rice 
7.394.   Table 12  sets out all the variables required to run the MPS formula  for early -season Indica 
rice following the United States' approach . First, it sets out the total national production  of early-
season Ind ica rice, provided exclusively by the United States . It goes on to multiply this total 
national production  by the producer price for early-season Indica rice for each year, to calculate 
the total value of production .  
7.395.   The table then determines the QEP. Thi s is done by (i) setting out the volume of production  
of early-season Indica  in each of the covered  provinces, as provided exclusively by the United States, 
and then (ii) subtracting the out-of-grade production  from each of these provinces. The QEP per 
province  is then totalled to determine the final QEP.  
7.396.   The AAP is the price set out in the relevant measures, multiplied by 20 to obtain a price 
expressed in renminbi/ton.  
7.397.   The FERP  is the average of three external reference prices for the years 1996 -1998 for 
"Indica rice" , as set out in Appendix DS 5-4 of China's tables of supporting material. We adjust  this 
FERP  downwards to the level of unmilled rice by multiplying it by 0.7, as discussed above.  
7.398.    To calculate an MPS value, first the adjusted FERP is sub tracted from the AAP. The resulting 
price differential is multiplied by the QEP. The resulting monetary value is the MPS for a specific 
year. Finally, this MPS  is divided by the  total value of production  above to arrive at a percentage.  
This percentage, in  the case of early -season and mid -late-season Indica rice, is for descriptive 
purposes only, as it is a total MPS percentage for Indica rice that we will  compare against China's 
8.5% de minimis  value.  
  WT/DS511/ R 
 
- 110 - 
 
  Table 12: Calculation of MPS for early -season Indica rice from 2012 -2015 
(United  States'  breakdown)  
Early -Season Indica rice MPS 
Calculation (US)  Units  2012  2013  2014  2015  
Total national production632 million tons  33.291  34.145  34.012  33.687  
Early-season producer price633 ¥/ton  2,622.00  2,603.20  2,681.60  2,687.40  
Total value of production  million ¥  87,289.00  88,886.26  91,206.58  90,530.44  
Average 1996 -1998 FERP (f.o.b. 
prices - milled)   ¥/ton  2343.00  2343.00  2343.00  2343.00  
Volume of production by 
covered province634           
Anhui  million tons  1.320  1.308  1.283  1.092  
Jiangxi  million tons  8.002  8.280  8.201  8.119  
Hubei  million tons  2.089  2.228  2.387  2.523  
Hunan  million tons  8.187  8.605  8.548  8.589  
Guangxi Zhuang 
Autonomous  Region  million tons  5.449  5.552  5.433  5.288  
Total  million tons  25.047  25.973  25.852  25.611  
Out-of-grade percentage635           
Anhui  percentage  0.0 0.0 0.0 0.0 
Jiangxi  percentage  1.0 1.0 0.0 0.0 
Hubei  percentage  0.0 0.0 0.0 0.0 
Hunan  percentage  1.0 0.0 3.0 1.0 
Guangxi Zhuang Autonomous 
Region  percentage  1.0 1.0 1.0 0.0 
QEP per province            
Anhui  million tons  1.320  1.308  1.283  1.092  
Jiangxi  million tons  7.922  8.197  8.201  8.119  
Hubei  million tons  2.089  2.228  2.387  2.523  
Hunan  million tons  8.105  8.605  8.292  8.503  
Guangxi Zhuang Autonomous 
Region  million tons  5.395  5.496  5.379  5.288  
MPS Calculation       
QEP million 
tons 24.831  25.835  25.541  25.525  
AAP (unmilled)636 ¥/ton  2,400.00  2,640.00  2,700.00  2,700.00  
Average 1996 -1998 FERP 
(unmilled  equivalent)637 ¥/ton  1640.10  1640.10  1640.10  1640.10  
Early -season Indica MPS 
= (AAP -adjusted FERP)*QEP  million 
RMB 18,868.79  25,832.10  27,071.15  27,054.06  
                                                
632 United States' response to Panel question No. 73, Table 9 (first substantive meeting);  China's 
Statistical Yearb ook, Table 12 -10, (2016), (Exhibit USA -18); China's Statistical Yearbook, Table 12 -10 (2015), 
(Exhibit USA -73); China's Statistical Yearbook, Table 12 -10 (2014), (Exhibit USA -74); China's Statistical 
Yearbook, Table 13 -15 (2013), (Exhibit USA -75). 
633 China' s first written submission, para. 258, Table 15; Agricultural Product Cost and Returns 2010 -
2016, (Exhibit USA -81/CHN -67). United States' first written submission, para. 122; China's Farm Gate Prices 
1995 to 2015 (Exhibit USA -79). 
634 United States' response  to Panel question No. 73, Table 8 (first substantive meeting); China's Rural 
Statistical Yearbook (2016), Table 7 -18, (Exhibit USA -76/CHN -33); China Agricultural Statistical Reports 
(2011 -2014), (Exhibit USA -77), pp. 5, 11, 19.  
635 China's response to Panel  question No. 93, Table 6 ; United States' response to Panel question No. 
93, China's States Administration of Grain, Standard & Quality Centre, Quality Survey Reports 2010 -2016 
(Exhibit USA -98). 
636 China's first written submission, Table 8; 2012 Rice Annual  Notice, (Exhibit USA -39/CHN -23B); 2013 
Rice Annual Notice, (Exhibit USA -40/CHN -24B); 2014 Rice Annual Notice, (Exhibit USA -41/CHN -25B); 2015 
Rice Annual Notice, (Exhibit USA -42/CHN -26B).  
637 WT/ACC/CHN/38/Rev.3, Appendix DS 5 -3, (Exhibit USA -43). WT/DS511/ R 
 
- 111 - 
 
  Early -Season Indica rice MPS 
Calculation (US)  Units  2012  2013  2014  2015  
MPS / National value of 
production of Indica  percentage  21.62  29.06  29.68  29.88  
 
7.4.7.2.6.2   Mid-Late-Season Indica rice  
7.399.   Table 13 sets out all the variables required to run the MPS formula for mid -late-season Indica 
rice following the United States' approach. First, it sets out the total national production of mid -late-
season Indica rice, which the United States asserts is calculated by subtracting the vo lume of early -
season Indica and Japonica rice from the total volume of Chinese rice production. The table goes on 
to multiply this total national production  by the producer price  for an average of the mid - & 
late-season prod ucer price for each year, to calculate the total value of production . 
7.400.   The table then determines the QEP. This is done by (i) setting out the volume of production  
of mid -late-season Indica rice in each of the covered provinces, as provided exclusively by th e United 
States, and then (ii) subtracting the out-of-grade production  from each of these provinces. The 
QEP per province  is then totalled to determine the final QEP. 
7.401.   The AAP is the price set out in the relevant measures, multiplied by 20 to obtain a price  
expressed in renminbi/ton.  
7.402.   The FERP  is the average of three external reference prices for the years 1996 -1998 for 
"Indica rice", as set out in Appendix DS 5 -4 of China's tables of supporting material. We adjust this 
FERP  downwards to the level of unmilled  rice by multiplying it by 0.7, as discussed above.  
7.403.   To calculate an MPS value, first the adjusted FERP is subtracted from the AAP. The resulting 
price differential is multiplied by the QEP. The resulting monetary value is the MPS for a specific 
year. Final ly, this MPS is divided by the total value of production  above to arrive at a percentage. 
This percentage,  in the case of early -season and mid -late-season Indica rice, is for descriptive 
purposes only, as it is a total MPS percentage for Indica rice which is to be compared against China's 
8.5% de minimis value.  
Table 13: Calculation of MPS for mid -late-season Indica rice from 2012 -2015 
(United  States' breakdown ) 
Mid-late-season Indica rice 
MPS Calculation (US)  Units  2012  2013  2014  2015  
Total national production638 million tons  106.406  105.136  107.239  108.739  
Average of Mid - & Late -season  
producer price639 ¥/ton  2,733.40  2,670.30  2,748.10  2,694.30  
Total value of production  million ¥  290,851.32  280,743.61  294,702.91  292,975.22  
Average 1996 -1998 FERP 
(f.o.b. prices - milled)  ¥/ton  2343.00  2343.00  2343.00  2343.00  
Volume of p roduction by 
covered  province640           
Jiangsu  million tons  2.641  2.672  2.658  2.714  
                                                
638 United S tates' response to Panel question No. 73, Table 9 (first substantive meeting);  China's 
Statistical Yearbook, Table 12 -10, (2016), (Exhibit USA -18); China's Statistical Yearbook, Table 12 -10 (2015), 
(Exhibit USA -73); China's Statistical Yearbook, Table 12 -10 (2014), (Exhibit USA -74); China's Statistical 
Yearbook, Table 13 -15 (2013), (Exhibit USA -75). 
639 China's first written submission, para. 258, Table 15; Agricultural Product Cost and Returns 2010 -
2016, (Exhibit USA -81/CHN -67). United States' first written submission, para. 122; China's Farm Gate Prices 
1995 to 2015 (Exhibit USA -79). It is prudent to use an average of the producer prices for mid - and late -season 
Indica rice. As an incorrect average of the producer price for mid -late-season rice was submitted  by the United 
States, the calculation for this type of rice is performed using the correctly averaged producer price for mid -
late-season Indica rice.  
640 United States' response to Panel question No. 73, Table 8 (first substantive meeting); China's Rural 
Statistical Yearbook (2016), Table 7 -18, (Exhibit USA -76/CHN -33); China Agricultural Statistical Reports 
(2011 -2014), (Exhibit USA -77), pp. 5, 11, 19.  
 WT/DS511/ R 
 
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  Mid-late-season Indica rice 
MPS Calculation (US)  Units  2012  2013  2014  2015  
Anhui  million tons  10.193  9.951  10.232  10.910  
Jiangxi  million tons  11.758  11.760  12.051  12.153  
Henan  million tons  4.926  4.858  5.286  5.315  
Hubei  million tons  14.425  14.539  14.908  15.584  
Hunan  million tons  18.130  17.011  17.792  17.859  
Guangxi Zhuang 
Autonomous  Region  million tons  5.971  6.010  6.228  6.090  
Sichuan  million tons  15.354  15.490  15.261  15.526  
Total  million 
tons 83.398  82.291  84.416  86.151  
Out-of-grade percentage641           
Jiangsu  percentage  0.0 0.0 0.0 0.0 
Anhui  percentage  1.0 1.0 0.8 0.0 
Jiangxi  percentage  1.0 0.0 0.0 0.0 
Henan  percentage  0.0 3.0 2.2 1.1 
Hubei  percentage  0.0 4.0 0.7 0.0 
Hunan  percentage  0.0 1.0 0.0 1.7 
Guangxi Zhuang  
Autonomous  Region  percentage  1.0 1.0 0.0 0.0 
Sichuan  percentage  0.0 0.0 1.3 1.0 
QEP per province            
Jiangsu  million tons  2.641  2.672  2.658  2.714  
Anhui  million tons  10.091  9.851  10.150  10.910  
Jiangxi  million tons  11.640  11.760  12.051  12.153  
Henan  million tons  4.926  4.712  5.170  5.257  
Hubei  million tons  14.425  13.957  14.804  15.584  
Hunan  million tons  18.130  16.841  17.792  17.555  
Guangxi Zhuang 
Autonomous  Region  million tons  5.911  5.950  6.228  6.090  
Sichuan  million tons  15.354  15.490  15.063  15.371  
MPS Calculation       
QEP million 
tons 83.119  81.234  83.915  85.634  
AAP (unmilled)642 ¥/ton  2,500.00  2,700.00  2,760.00  2,760.00  
Average 1996 -1998  FERP 
(unmilled  equivalent ) ¥/ton  1640.10  1640.10  1640.10  1640.10  
Mid-late-season Indica MPS 
= (AAP -adjusted  FERP)*QEP  million 
RMB  71,473.84   86,099.90   93,976.52   95,901.15  
MPS / Value of Production  percentage   24.57   30.67   31.89   32.73  
 
7.4.7.2.6.3   Total Indica rice MPS calculation  
7.404.    Table 14 sets out  the total value of production of all Indica rice  calculated by summing 
the value of production of early - and mid -late-season Indica rice, provided in Tables 12 and 13 
above.  
                                                
641 China's response to Panel question No. 93, Table 6 ; United States' response to Panel question No. 
93, Chi na's States Administration of Grain, Standard & Quality Centre, Quality Survey Reports 2010 -2016 
(Exhibit USA -98). 
642 China's first written submission, Table 8; 2012 Rice Annual Notice, (Exhibit USA -39/CHN -23B); 2013 
Rice Annual Notice, (Exhibit USA -40/CHN -24B); 2014 Rice Annual Notice, (Exhibit USA -41/CHN -25B); 2015 
Rice Annual Notice, (Exhibit USA -42/CHN -26B).  WT/DS511/ R 
 
- 113 - 
 
  Table 14: Total value of production for Indica rice from 2012 -2015 
(United  States'  breakdown ) 
7.405.   Table 15  sets out the total MPS for Indica rice , which is the sum of  the MPS  for early - and 
mid-late-season Indica rice, set out in Tables 12 and 13 above. This total MPS is divided by the total 
value of production  of Indica rice (calculated in Table 14) to arrive at a percentage  which can be 
compared with China's 8.5% de minimis level. 
Table 15: Calculation of total MPS for Indica rice from 2012 -2015 
(United  States'  breakdown ) 
Total Indica rice MPS 
calculation  Units  2012  2013  2014  2015  
Total MPS for Indica rice  
= early -season MPS + 
mid-late-season  MPS)  million RMB  90,342.63  111,931.99  121,047.67  122,955.21  
MPS / Total value of 
production  Indica rice  percentage  23.89  30.28  31.37  32.06  
 
7.4.7.2.7   Indica r ice (China's approach ) 
7.406.   Table 16  sets out all the variables required to run the MPS formula for Indica rice broadly 
following China's approach . First, it sets out the total national production  of Indica rice, which 
China asserts is the amount of rice which is not Japonica rice (i.e. 66.7% of total national 
production).  
7.407.   The table goes on to multiply this total national production  by the producer price 
calculated as  an average of the early-, mid- & late-season producer price s for each year, to 
calculate the total value of production .  
7.408.   The table then determines the QEP. While China does provide the percentage of out-of-
grade production  in each province, it did not provide data on production by province . Thus, in 
the case of Indica rice, the table first sets out the data on the volume of production  of Indica rice  
in all of the covered provinces. This is the  total volume of prod uction of all rice in the covered 
provinces, multiplied by 0. 667. The table then averages the percentages of out-of-grade 
production  provided by China into a single figure. Calculating the QEP involves (i) setting out the 
total volume of production  of Indica rice in all of the covered provinces and then (ii) subtracting 
the out-of-grade production  (calculated using the  average out-of-grade percentage ) from this 
total.   
7.409.   The AAP is an average of the early and mid -late prices set out in the relevant measures, 
multiplied by 20 to obtain a price expressed in renminbi/ton.  
7.410.   The FERP  is the average of three external reference prices for the years 1996 -1998 for 
Indica rice , as set out in Appendi x DS 5-4 of China's tables of supporting material. We adjust  this 
FERP  downwards to the level of unmilled rice by multiplying it by 0.7, as discussed above.  
7.411.   To calculate an MPS value, first the adjusted FERP is subtracted from the AAP. The resulting 
price differential is multiplied by the QEP. The resulting monetary value i s the MPS for a specific 
year. Finally, this MPS is divided by the total value of production  above to arrive at a percentage  
which can be compared with China's 8.5% de minimis level 
   Units  2012  2013  2014  2015  
Total value of 
production (all 
Indica  rice)  million 
RMB 378,140.32  369,629.88  385,909.49  383,505.66  WT/DS511/ R 
 
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  Table 16: Calculation of MPS for Indica rice from 2012 -2015 ( China's breakdown)  
Indica rice MPS Calculation 
(China)  Units  2012  2013  2014  2015  
Total national p roduction643 million tons   136.225   135.809   137.740   138.886  
Average of early -, mid- and 
late-season producer price  ¥/ton  2,696.27  2,647.93  2,725.93  2,692.00  
Total value of production  million ¥  367,300.04  359,613.72  375,470.52  373,881.31  
Average 1996 -1998 FERP (f.o.b. 
prices - milled)  ¥/ton  2343.00  2343.00  2343.00  2343.00  
Volume of p roduction644      
Total in covered provinces  million tons  106.278  106.778  108.095  109.481  
Out-of-grade percentage645           
Anhui  percentage  0.5 0.5 0.4 0.0 
Jiangxi  percentage  1.0 0.5 0.0 0.0 
Hubei  percentage  0.0 2.0 0.4 0.0 
Hunan  percentage  0.5 0.5 1.5 1.4 
Guangxi Zhuang Autonomous 
Region  percentage  1.0 1.0 0.5 0.0 
Jiangsu  percentage  0.0 0.0 0.0 0.0 
Henan  percentage  0.0 3.0 2.2 1.1 
Sichuan  percentage  0.0 0.0 1.3 1.0 
Average  percentage  0.4 0.9 0.8 0.4 
MPS Calculation       
QEP million tons  105.879  105.777  107.250  109.009  
AAP average of Early & Mid -
Late (unmilled)646 ¥/ton  2,450.00  2,670.00  2,730.00  2,730.00  
Average 1996 -1998 FERP 
(unmilled  equivalent ) ¥/ton  1640.10  1640.10  1640.10  1640.10  
Indica MPS 
= (AAP -adjusted  FERP)*QEP  million 
RMB 85,751.59  108,939.72  116,891.99  118,809.17  
MPS / Total value of 
production  percentage  23.35  30.29  31.13  31.78  
 
7.4.8   Conclusion on the calculation of China's Current Total AMS  
7.412.   From the above calculations, we observe that China's product -specific AMS, as provided 
through market price support, for  each of  wheat, Indica rice and Japonica rice in the years 2012 , 
                                                
643 Production amount of I ndica rice = national total * (1 -33.3%); See China's first written submission, 
Table 5; China's Rural Statistical Yearbook ( 2013), (Exhibit CHN -49), p. 152 ; China's Rural Statistical Yearbook 
(2015), (Exhibit CHN -50), p. 164; China's Rural Statistical Yearbook (2016), (Exhibit USA -76/CHN -33), p. 168; 
China's Rural Statistical Yearbook (2016), (Exhibit USA -76/CHN -33), p. 167.  
644 These figures were arrived at by taking the total production of rice in the provinces covered by the 
measures and multiplying this by 0.667. No provincial breakdown is given due to insufficient data on the 
record. China's Rural Statistical Yearbook (2013),  (Exhibit CHN -49), p. 152 ; China's Rural Statistical Yearbook 
(2015), (Exhibit CHN -50), p. 164; China's Rural Statistical Yearbook (2016), (Exhibit USA -76/CHN -33), p. 168; 
China's Rural Statistical Yearbook (2016), (Exhibit USA -76/CHN -33), p. 167.  
645 China' s response to Panel question No. 93, Table 6 ; United States' response to Panel question No. 
93, China's States Administration of Grain, Standard & Quality Centre, Quality Survey Reports 2010 -2016 
(Exhibit USA -98). 
646 China's first written submission, Table 8; 2012 Rice Annual Notice, (Exhibit USA -39/CHN -23B); 2013 
Rice Annual Notice, (Exhibit USA -40/CHN -24B); 2014 Rice Annual Notice, (Exhibit USA -41/CHN -25B); 2015 
Rice Annual Notice, (Exhibit USA -42/CHN -26B).  WT/DS511/ R 
 
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  2013, 2014 and 2015, is above China's 8.5% de minimis  threshold. For rice, t his is so regardless of 
which of the variation s in the calculations  is employed to  produce the AMS values,  as discussed 
above. Therefore,  an above -nil AMS value is to be included in  China's Current Total AMS figures . 
7.413.   We thus find that China's level of support in favour of domestic producers is in excess o f 
China's  commitment level of "nil", set forth in Section I of Part IV of  China's Schedule of Concessions 
on Goods (CLII) . Therefore, China is not in compliance with its domestic support commitments 
pursuant to Article s 3.2 and  6.3 of  the Agreement on Agriculture.  
7.5  Claim under Article 7.2(b) of the Agreement on Agriculture  
7.414.   The P anel recalls that the United States made an alternative claim, to the extent that China's 
commitment level of "nil" were understood as not setting out any commitment, requesting  the Panel 
to find that the challenged  measures are inconsistent with China's obligation under Article 7.2(b) of 
the Agreement on Agriculture .647 Given our findings under Articles 3.2 and 6.3 of the Agreement on 
Agriculture, we do not find it necessary to conduct an assessment of the United Stat es' alternative 
claim.   
8  CONCLUSIONS  AND RECOMMENDATION S 
8.1.  The Panel concludes  that in the years 2012, 2013, 2014 and 2015, China provided domestic 
support , expressed in terms of its Current Total AMS, in the form of market price support to 
producers of wheat , Indica rice and Japonica rice in excess of its commitment level of "nil", set forth 
in Section I of Part IV of China's Sc hedule of Concessions on Goods CLII . As such, China acted 
inconsistently with its obligations under Articles  3.2 and 6. 3 of the Agree ment on Agriculture.  
8.2.  Under Article 3.8 of the DSU, in cases where there is an infringement of the obligations 
assumed under a covered agreement, the action is considered prima facie  to constitute a case of 
nullification or impairment.  The Panel concludes t hat, to the extent that the measures at issue are 
inconsistent with certain provisions of the Agreement on Agriculture, they have nullified or impaired 
benefits accruing to the United States under that agreement.   
8.3.  Pursuant to Article 19.1 of the DSU, the P anel recommends that China bring its inconsistent 
measures into conformity with its obligations under the Agreement on Agriculture.  
 
__________  
 
                                                
647 United States' first written submission, para. 137 and fn 251.