RESTRICTED  WORLD TRADE  
ORGANIZATION  G/AG/R/48 
6 July 2007 
 (07-2899) 
Committee on Agriculture  
  
SUMMARY REPORT OF THE MEETING HELD ON  28 MARCH 2007 
 
Note by the Secretariat
1 
  1. The Committee on Agriculture held its fort y-eighth regular meeting on 28 March 2007 under 
the chairmanship of Mr. Christian Häberli of Swit zerland.  The Chairman welcomed the delegation of 
Viet Nam who would be participating for the first time at a meeting of th e Committee, after acceding 
to the WTO. 
2. The agenda of the meeting as set out in WT O/AIR/2980 was adopted, with the addition of 
item (xiii) under Section I, Point A below ( questions by the United States to China). 
I. THE REVIEW PROCESS  
A. M
ATTERS RELEVANT TO THE IMPLEMENTATION OF CO MMITMENTS UNDER THE REFORM 
PROGRAMME :  ARTICLE 18.6 
(i) Australia - European Communities (EC) e xport subsidy commitments for wine and alcohol    
3. With specific reference to the product coverage  defined in point 15 of the Annex to EC 
Schedule CXL, Australia sought details on (i) the t ypes of export subsidies accorded to the "wine" 
product category, i.e. whether the export subsidi es were granted on the wine product itself or on 
intermediate products from which wine was processed or for use in wine manufacturing; (ii) whether 
any wine categories (including products processed from  wine or by-products of wine) were eligible 
for export subsidies under the incorpor ated products commitment, and if so, (iii) the share of subsidies 
granted to the incorporated products category in the total export subsidies provided to wine.  The EC 
explained that export subsidies could be granted for table wines and grape must and that the eligible 
products and the level of subsid ies were detailed in Council Regul ation (EC) 1605/2003, last updated 
by Council Regulation (EC) 259/2007.  A full description of the tariff lines covered had been published in Official Journal N° L 406 of 30 Decemb er 2006.  The EC also confirmed that no wines 
or their by-products were eligible for export subs idies under the incorporated products category.  
4. Noting that Schedule CXL did not appear to provide the description nor the HS positions 
applicable to alcohol (a product listed in the EC's  Schedule of export subsidy commitments), Australia 
sought information on (i) the produc ts covered under alcohol, including their HS positions at the six-
digit level; (ii) the nature of the export subsidies granted to alcohol; (iii) whether any alcohol products 
were eligible for export subsidies under the incorpor ated products category, and if so, the nature and 
type of such subsidies.   
                                                     
 
1 This document has been prepared under the Secret ariat's own responsibility and is without prejudice 
to the positions of Members or to their rights or obligations under the WTO. G/AG/R/48 
Page 2  
 
  5. The EC clarified that the codes applying to  alcohol were HS 2207.10 and HS 2207.20 and 
that no export subsidies were provided to either alcohol or products containing alcohol under the 
incorporated products category.  However, vermout h and other wine of fresh grapes flavoured with 
plants or aromatic substances (CN code 2205) were  eligible for export refunds on the basis of cereals 
and sugar content.  Similarly, cereal-based spirit uous beverages (CN code 2208) were eligible for 
export refunds.   
6. In its follow-up comments, Australia requested  information on the nature and type of 
subsidies for alcohol and whether export subs idies being granted under CN codes 2205 and 2208 
related to the incorporated products category.  In  this regard, the EC pointed out that no export 
subsides were paid under the incorporated products cat egory on the basis of wine or alcohol content.  
All export subsidies under that category were based on either cereals or sugar content. 
(ii) Australia - Consolidation of EC Schedule consequent to enlargement
  
7. Referring to the EC's previous confirmation2 that Schedule CXL was applying to the EC-25 
de facto , Australia enquired whether (i) Schedule CXL also  applied to the EC-27; (ii) the EC would 
follow the procedure that had been applied during the enlargement to the EC-15, as far as domestic 
support and export subsidy reduction commitments for the EC-25, and for the EC-27, were 
concerned;  and, if so, (iii) an estimate of th e timeframe for commencing such procedures could be 
supplied by the EC.  The EC confirmed that, until further notice, Schedule CXL would be applied to 
the EC-27. For the purposes of establishing do mestic support and export subsidy reduction 
commitments, the EC intended to follow the same procedure as it had followed during enlargement to 
the EC-15.  However, at this stage, the EC coul d not provide any timeframe.  Australia hoped that the 
process would commence soon given that almost thre e years had passed since the enlargement to the 
EC-25. 
(iii) Australia – Turkey's wheat flour exports   
8. Australia noted that Turkey's most recent notification3 showed that, in calendar year 2000, 
total exports of wheat flour amounted to 354,858 tonnes and that no export subsidies had been 
provided.  Australia understood that, in the past, Tu rkey had provided export subsidies to wheat flour, 
since that product was specified Turkey's schedule of export subsidy reduction commitments.  
Australia observed, however, that no export subsid ies on wheat flour had been notified by Turkey 
since calendar year 1995.4 Australia also understood that Turkey supplied significant quantities of 
wheat flour as food aid, and, in that context, requested the following information: (i) updated figures on wheat flour exports since calendar year 2000; (i i) data on food aid exports for the most recent 
calendar years available; (iii) details of the export subsidies provided to wheat flour prior to 2000 and 
the date when these were eliminated; (iv) whethe r any export subsidies had been granted to wheat 
flour since calendar year 2000, and if so, details of budgetary outlays and quantities. 
9. Australia further remarked that  special measures appeared to apply to wheat flour exports 
through access to wheat from domestic stocks at discounted prices and/or by special inward 
processing arrangements.  Details were thus sought on  (i) all such measures, including their period of 
validity and whether they continued to be availabl e, either as regulatory instruments or as applied 
measures; (ii) whether wheat flour exporters benefited from any other forms of assistance, including direct export subsidies or payments in kind, incl uding revenue foregone (e.g ., tax exemptions); and 
                                                     
 
2 See, for example, G/AG/R/47, paragraph 15. 
3 G/AG/N/TUR/13. 
4 G/AG/N/TUR/1.  G/AG/R/48 
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  (iii) the availability of subsidies payable conti ngent on the incorporation of wheat flour in the 
exportation of processed agricultural products.  
10. Pointing to Turkey's most recent domestic support notification5 which showed that support is 
provided to wheat, the basic product from which wheat  flour is processed, Australia also requested 
information on: (i) budgetary assistance to wheat  flour, including production-specific support, 
assistance provided through more horizontal measures su ch as investment grants;  (ii) whether any of 
the price support to wheat was contingent on supply of wheat to wheat flour processors and, if so, 
whether any such support was contingent on supply of wheat flour for the export market;  (iii) 
whether any non-budgetary domestic assistance (inc luding any revenue foregone) was provided to 
wheat flour production, and if so, details of such  arrangements; (iv) the proportion of wheat flour 
production which was consumed on the domestic mark et compared to the export market;  and (v) 
whether any subsidies were payable contingent on the incorporation of wheat flour in processed 
products consumed on the domestic market. 
11. Turkey stated that these questions were still in examination in capital and that detailed written 
answers would be provided as soon as available.  In the meantime, Turkey wished to point out that 
although " wheat flour " was listed in Turkey's Schedule of export subsidy reduction commitments, no 
export subsidy had been accorded to it since 1995.  Export subsidies had been provided in full 
compliance with Turkey's commitments to " Chocolate and other food preparations containing 
chocolate, biscuits, pastry ", which contained wheat flour among othe r ingredients. As regards statistics 
on food aid, Turkey clarified that 50,000 tonnes of wh eat flour had been supplied to Pakistan in 2005, 
and 10,000 tonnes had been supplied to the Palestinia n Authority in 2006.  Since the end of 2006, the 
role of the Turkish Grain Board in inward pro cessing arrangements, as well as in sales of wheat, had 
been terminated.   
(iv) EC – Argentina's newly announced subsidy measures for wheat producers  
 12. The EC referred to Resolution 11/2007 of 9 March 2007 published in the " Oficina Nacional 
de Control de Comercio Agropecuario " (ONCCA) (National Office for the Control of Agricultural 
Trade) concerning the introduction of a subsidy in tended to cover 85 per cent of the gap between 
domestic prices and export values for wheat.  Accordi ng to the information available to the EC, an 
amount of approximately Arg$50 per tonne would be deposited directly  with wheat producers, up to a 
total amount of Arg$100 million.  the EC sought (i) confirmation of the above information; (ii) an 
explanation of the functioning of the measure; and ( iii) an indication as to how Argentina intended to 
notify such support.   
13. Argentina explained that the objective of the ONCCA Resolution cited by the EC was to  
stabilize the domestic consumer prices of products derived from wheat, maize, soybeans and sunflower seeds.  The sole objective of the comp ensation measures was to keep inflation within 
acceptable limits by ensuring that increases in the in ternational prices of these inputs did not translate 
into higher prices of food staples for households.  Such compensation enabled producers to maintain 
selling prices at their November 2006 levels, t hus preserving consumers' purchasing power.  
Argentina stressed that, being a developing countr y, food accounted for a significant percentage of 
spending by middle- to low-income households an d thus food price increases could significantly 
impact on Argentine citizens' household economies.  In Argentina, each point of inflation placed 
another 300,000 people below the poverty line.  In th at sense, the measures did not benefit agricultural 
producers since no profit was made by selling products at below market prices.  Rather, the measures 
benefited consumers, especially at low-income leve ls, by ensuring continue d access to the foodstuffs 
that are necessary to their survival. 
                                                     
 
5 G/AG/N/TUR/14. G/AG/R/48 
Page 4  
 
  14. As regards the functioning of these measures, Argentina clarified that producers would be 
compensated based on the tonnage of processed pr oducts destined for the domestic market.  The 
amount of the compensation would be equivalent to  the difference between the market value of the 
product in question and domestic s upply prices.  To set that amount, the maximum will be taken to be 
the tonnages involved in trading transactions reported and registered monthly at the ONCCA for the 
period 1 December 2005 to 30 November 2006, net of the output destined for exportation.   
15. In the specific case of wheat, compensation fo r both flour mills and wheat producers would 
be set on the basis of domestic sales and would c over 85 per cent of the tonnage that would comply 
with the regulatory requirements.  Such compensa tion would be paid monthly, at the end of each 
month.  In the case of wheat producers, the amount would be the difference between the export parity 
price calculated by the Government, and the selli ng price, which would specifically correspond to the 
ex-mill price, provided that it is not lower than the regulated supply price.   Where the price paid to 
the producer is higher than the regulated supply price, the producer's compensation would fall between that amount and the export parity price announced by the Government.  In the case of flour mills, the compensation would be the difference between  the price paid by the mills and the regulated 
supply price. 
16. Argentina reiterated that the above measur es provided no compensation whatsoever, whether 
direct or indirect, for products being sold for ex port.  All the products benefiting from compensation 
had to display, both on the invoice and on the packaging, the phrase " for domestic consumption ". 
Similarly, the products being sold for export had to display the corresponding statement.  Moreover, 
the data submitted by each producer would be cro sschecked against Argentine Customs data, and the 
two sets of figures had to coincide for the compensat ion to be effectively paid.  Argentina indicated 
that full information concerning such measures is  available on the Web site of the Argentinean 
Secretariat for Agriculture, Livestock, Fisheries and Food at:  www.sagpya.mecon.gov.ar
. 
(v) EC – Argentina's subsidy for poultry, pig and cattle producers on the use of maize as input  
17. The EC enquired whether ONCCA also implemente d a subsidy on the price for maize used as 
input by poultry, pig and cattle producers (Resoluti ons 1378/2007 and 1379/2007), and if so, whether 
Argentina could explain the functioning of these subs idy measures, and indicate how such agricultural 
support would be notified.  Argentina referred th e EC to its reply above in paragraphs 13-16. 
 (vi) EC – Argentina's proposed new agricultura l support for beef and dairy, and oil processing  
18. The EC enquired whether further agricultural support measures for beef production, dairy 
production and oil processing were envisaged.  The EC further requested the overall amount that 
would be available under these measures and also how  the support would be notified.  Argentina 
referred the EC to its reply above in paragraphs 13-16. 
19. Chile pointed out that it shared the majority of the concerns expressed by the EC.  While 
Chile could understand the legitimate objectives pursu ed by Argentina, Chile believed that the 
measures in question caused prejudice to its agri culture industry as the measures involved subsidy 
elements.  Chile also enquired when Argentina would notify the measures reflecting the actual 
subsidy amounts.  Argentina considered that the issues raised by Chile were new and should have 
been raised in advance of the meeting.  Argent ina stressed that the co mpensation afforded to 
consumers under the programme by no means viol ated Argentina's multilateral commitments.   
20. The Committee took note of the comments made by  both delegations to the extent these 
related to the current agenda item.  G/AG/R/48 
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  (vii) EC – Canada's announcement of  additional subsidies for farmers  
 21. The EC referred to an announcement made by  the Canadian Prime Minister on 9 March 2007, 
whereby the Canadian Government would commit Can$1 billion for relieving costs of production for 
farmers while replacing the Canadian Agricultural Income Stabilization (CAIS).   The EC understood 
that production insurance, improvements to the margin-based programme, and a new disaster relief 
framework would become available under the new arrangements, with the main component (three-
fifths of the planned support measure) concerning income stabilization.  On top of these new arrangements, the Prime Minister had also mentioned that, an " annual cost of production benefit " 
would be payable during each of the next five years should there be a net increase in production costs.  
The EC wondered how these measures would be desi gned box-wise; whether Ca nada could guarantee 
that such measures did not actually represent an increase in the amount of Canada's more trade-
distorting support; and whether the announced am ount of Can$1 billion should be understood as being 
supplementary to the current support levels. 
22. Canada replied that it was proposing a separat e income stabilization programme through the 
establishment of a new savings account programme for farmers.  Canada explained that once 
agreement was reached with provinces and territo ries and these accounts were established, there 
would be a one-time payment of Can$600 million in federal contributions into the new producer 
savings accounts.  Canada also proposed to est ablish a cost-of-production element with these new 
savings accounts, at a cost of up to Can$100 million annually.  In years when costs of production for 
the sector as a whole were rising, the federal govern ment would make additiona l contributions (up to 
Can$100 million annually) to the new savings accounts.  There would also be an immediate direct 
payment of Can$400 million to help address rising production costs faced by producers over the last four years.  Canada noted that the funding was c onsistent with Canada's WTO obligations and would 
be notified to the Committee on Agriculture appropriately in due course. 
(viii) New Zealand – Canada's new funding annou ncement for national farm income programmes
 
23. New Zealand sought details on the federal initiativ e described in sub-paragraph (ii) above.  
New Zealand understood that the programme woul d directly inject Can$400 million to producers to 
"help with the high cost of production in farming " and Can$600 million for ne w federal contributions 
in producer savings accounts.  New Zealand also  asked how the initiative would be classified under 
the Agreement on Agriculture.  
24. Canada referred to its repl y in paragraph 22 above.   
25. In their follow-up comments, the EC and New Zealand requested elaboration on the possible 
classification (Amber, Blue or Green Box) of the measures under the Agreement on Agriculture.  Canada noted that the exact operational details of the programme were still to be worked out, only 
after which the issue of the possible classification could be considered. 
(ix) New Zealand – Canada's announcement of GATT XXVIII procedures (tariff quota for milk 
protein concentrates)  
26. New Zealand referred to Canada's recent announcement that it planned to invoke GATT 
Article XXVIII renegotiation procedures to impos e tariff quotas on the import of milk protein 
concentrates. New Zeal and wondered how such an announcem ent contributed to Canada's 
commitment to reduce impediments to trade in th e Doha negotiations.  Fu rthermore, New Zealand 
understood that the renegotiation procedure might focu s on identifying the volume, origin and type of 
imports entering Canada u nder tariff line 3504.0000.00, which, at the ten-digit level of the HS, did not 
distinguish between imports of peptones of dairy (m ilk protein concentrates/milk protein isolates) and 
non-dairy origin.  In that context, New Zealand sought information on the expected impact of the G/AG/R/48 
Page 6  
 
  GATT Article XXVIII negotiations on imports of milk protein concentrates and milk protein isolates 
and any products of non-dairy origin covered by the tariff line in question.  New Zealand also 
wondered how such negotiations would affect the tr ade of countries that had free trade agreements 
(FTAs) with Canada. 
27. Canada pointed out that that it was a strong su pporter of an ambitious outcome to the Doha 
negotiations.  Its decision to invoke GATT Article X XVIII was made as a result of the change in the 
tariff classification of milk protein concentrates resulting from rulings made by Canadian domestic 
courts in 2005 and 2006.  Canada further believed that the ri ght to renegotiate tariff concessions 
through GATT Article XXVIII was a longstanding right  under the WTO Agreements.   While taking 
recourse to a GATT Article XXVIII action, Canada would fully respect its WTO obligations.  As 
regards the identification of products at the ten-digi t level of the HS, as well as the expected impact of 
GATT Article XXVIII negotiations on imports, Cana da confirmed that such matters would be 
addressed in the context of the negotiations.  More over, being a signatory to a number of FTAs, 
Canada would adhere to it s rights and obligations under all of these agreements .  
28. New Zealand requested further elaboration on the possible impact of the GATT 
Article XXVIII negotiations (i) on the import of milk  protein concentrates and milk protein isolates 
and (ii) on countries with which Canada had FTAs.   The European Communities, the United States 
and Australia expressed keen interest and concern in  the matter.  Canada took note of these additional 
comments. 
(x) New Zealand – Canada's compositional standards for cheese
 
29. New Zealand requested information on (i) the objective of the regulatory process relating to 
compositional standards for cheese launched by the Government of Canada on 7 February 2007, and 
(ii) the approach taken in designing such standard s in order to encourage local milk production and 
discourage the use of imported dairy ingredients. 
30. Canada stated that the Canadian Food Inspecti on Agency had launched a regulatory initiative 
relating to compositional standards for cheese with a view to contributing towards the harmonization 
of existing federal regulations (Food and Drug Re gulations, and Dairy Products Regulations) by 
providing clarification and consiste ncy on the ingredients which might be used for the manufacture of 
cheese, and providing consumers with greater predicta bility with regard to the essential characteristics 
of standardized cheese. 
31. The European Communities, Switzerland and th e United States expressed their concern and 
interest in the matter. 
(xi) New Zealand – Canada's expansion of Special Milk Class 5(c) (SMC 5(c))  
32. New Zealand referred to the announcement by  the Canadian Milk Supply Management 
Committee (CMSMC) and the Canadian Dairy Commi ssion (CDC) that SMC 5(c) would be expanded 
to allow producers of frozen ice cream novelties to be  eligible for access to milk components such as 
milk protein, milk fat and milk solids from dom estic dairy producers at discounted prices. New 
Zealand expressed concerns regarding possible impl ications for exporters of milk components and 
their access to the Canadian market, particularly in light of the establishment, two years ago, of SMC 4(a)1.   
33. In that context, New Zealand sought details on (i) the expected impacts of the Canadian 
measure on the price relationships in the market, and in particular, on im ports of butter-oil sugar 
blends; (ii) how Canada would ensure that the value of the tariff quota for ice cream would be 
maintained (i.e., that imports were not displaced by domestically subsidized production of ice cream  G/AG/R/48 
 Page 7 
 
 
  novelties); (iii) how and when the me asure would be notified to the WTO, either under the Agreement 
on Agriculture or the Agreement on Subsidies and Countervailing Measures; and (iv) whether Canada had any plans to further expand special milk cl asses, and in particular, whether Canada was 
considering the further expansion of discounted pricing under SMC 4(a)1 to also include use for 
weight-gain products, sports and medical r ecovery drinks, and other similar products. 
34. Canada reported that the Special Milk Class Permits Program was now over ten years old 
with eligibility criteria and parameters remain ing essentially unchanged over that period.  The 
products initially, and still, targeted by the programme were prepared and frozen food products 
(further processed products).  According to Canada, the occasional expansion of  eligible products was 
a reflection of the evolving nature of the dairy product mix offered to th e Canadian consumer.  
Further processed foods had become increasingly popu lar over the years, due to changing consumer 
habits.  Ice cream novelties, which accounted for a very small proportion of the total ice cream 
market, had been recently accepted by CMSMC as an  eligible product for the SMC 5(c).  Although 
Canada did not expect that this measure would have  any impact on retail prices, there was no way to 
predict its impacts on the purchasing decisions taken by ice cream manufacturers with respect to 
ingredients. 
35. Canada considered that the recent change in the classification of ice cream novelties under 
Canada's milk pricing system bore no relationship to  its tariff quota commitments and obligations for 
ice cream.  Canada noted that the tariff quota for ice cream amounted to 484 tonnes, and that over the 
period 2001-2005, the fill rate had aver aged 95 per cent.  Canada did not expect this fill rate to change 
as a result of the decision to expand the SMC 5(c).  Canada further considered that the Special Milk 
Class Program was not subject to notification requirements under any of the WTO Agreements 
mentioned by New Zealand.  The CMSMC had recently approved, in principle, the inclusion of the above-mentioned products in SMC 4(a) 1 but the final definitions of elig ible products had not yet been 
approved.  Canada stated that there were no plans for further expansion at this time and that the 
products in question occupied very small niche markets. 
 (xii) United States - Nigeria's import prohibitions on certain agricultural products and use of 
reference prices for customs valuation purposes  
 36. The United States understood that Nigeria maintained import prohibitions on several 
agricultural products such as fresh fruit, millet, pork and pork products, bottled water, and frozen 
poultry and poultry products. The United States asked Nigeria to clarify the reasons for maintaining 
such measures and to explain their conformity with Nigeria's WTO obligations.  The United States 
also sought an explanation of Nigeria's use of refe rence prices (instead of act ual declared values) for 
customs valuation purposes.  
37. Nigeria indicated that the questions posed by th e United States had been transmitted to capital 
for an official response.  As a preliminary respon se, Nigeria wished however to inform the Committee 
that import prohibitions on selected items had b een temporarily applied in order to address 
development challenges.  These measures would be eventually phased out, a process which was 
already ongoing.  Moreover, in response to the internal  situation with regard to avian influenza, some 
import controls had been introduced consistent w ith the technical advice provided by FAO and OIE 
(Organisation of Animal Health).  In order to c ontain the spread of the highly pathogenic avian 
influenza, the Nigerian authorities had, inter alia , stopped the movement of livestock and livestock 
products (including poultry) across borders.  Referring  to its SPS notification
6, Nigeria noted that both 
FAO and OIE had welcomed the emergency measur es taken.  Nigeria sought the support from the 
United States and other trading partners to confr ont this SPS problem and renewed the assurances of 
its commitment to the multilateral trading system. 
                                                      
6 See document G/SPS/GEN/637, dated 23 February 2006. G/AG/R/48 
Page 8  
 
  (xiii) United States – China's VAT policies
 
 38. The United States observed that China applied a VAT of 13 per cent on agricultural imports 
while the effective VAT on domestic agricultural pr oducts varied between 3.23 and 6.2 per cent.  
According to the United States, this VAT policy ha d a negative impact on imports.  Noting further 
that agricultural exports often received a VAT re bate of 13 per cent, the United States sought an 
explanation from China as regards (i) the justifi cation for maintaining these VAT exceptions, and (ii) 
the consistency of these policies with China's WTO obligations.  
39. In view of the late receipt of these questions , China undertook to provide a response in due 
course. 
B. R
EVIEW OF NOTIFICATIONS  
(i) Notifications in respect of which questions have been raised in advance of the issuance of the 
convening airgram  
40. The Committee reviewed the notifications as listed in the agenda.  Specific points raised with 
respect to these notifications and the r esponses thereto are summarized in Annex 1  to this report. 
(ii)  Notifications subject to review in respect of  which no questions have been raised in advance 
of the issuance of the convening airgram  
41. The Committee took note of the notifications which had been circulated in advance of the 
date on which the notice convening the present me eting was issued, but in respect of which no 
questions had been raised by that date under th e Committee's Working Procedures (G/AG/1).  These 
notifications are listed in Annex 2. 
(iii) Notifications circulated or made availabl e after the notice convening the meeting was issued  
42. The following notifications were subject to prelim inary review and are to be reverted to at the 
next meeting for substantive review in accordan ce with paragraph 9 of the Committee's Working 
Procedures: 
(a) relating to the administration of tariff and other quota commitments (Table MA:1):  from 
Chile (CHL/24); 
(b) relating to imports under tariff and other quot a commitments (Table MA:2):  from Chile 
(CHL/25); 
(c) in the context of the special safeguard (Tab les MA:3 to MA:5):  from Chinese Taipei 
(TPKM/49); 
(d) in the context of domestic support commitmen ts (Tables DS:1 and DS:2):  from Korea 
(KOR/37/Corr.1), Macao, China (MAC/21), Mexico (MEX/13/Rev.1 and MEX/14) and 
New Zealand (NZL/46); and 
(e) in the context of export subsidy commitments (Tables ES:1 to ES:3):  from Chile 
(CHL/23) and Macao, China (MAC/20).  G/AG/R/48 
 Page 9 
 
 
  (iv)  Points concerning notificati ons raised at previous meetings  
43. The Chairman recalled that delegations have the possibility to inform the Committee of the 
outcome of discussions which are of general interest , but which may have been pursued bilaterally as 
a result of the review of notifications.  Th ere was no discussion under this agenda item. 
(v) Counter-notifications  
44. The Committee took note that no counter-notifi cations had been received under Article 18.7 
of the Agreement on Agriculture. 
(vi) Deferred replies to questions  raised under the Review Process  
45. Switzerland referring to a question7 by Canada raised in the previous meeting of the 
Committee concerning Switzerland's Table DS:2 no tification in G/AG/N/CHE/35, noted that the 
notification was being revised.8 
(vii) Overdue notifications  
46. The Chairman recalled that paragraph 6 of  WTO/AIR/2971 contained a reminder regarding 
overdue notifications.  An updated room document showing the current status of compliance with 
notification obligations was made available by the Secretariat. While noting that 55 new notifications, 
including 24 in the field of domestic support, had been received since the previous meeting of the 
Committee which could be deemed as some improveme nt in the situation, the Chairman underlined 
that notifications from 78 Members were still outsta nding for the period 1995-2 001.  Moreover for the 
period 1995 to 2005, the total number of outsta nding domestic support notifi cations from all Members 
amounted to 545.  The Chairman deplored the curre nt situation as regards Members' compliance with 
their notification obligations and stressed that notif ications in the field of domestic support for the 
period under review were especially important fro m the point-of-view of the ongoing agriculture 
negotiations.  The Chairman urged Members to fulf il their notification obligations as soon as possible. 
47. Australia concurred with the Chairman in ever y respect.  Australia believed that, for the sake 
of credibility of the Committee, and in view of the ongoing negotiations, it was important that the 
major subsidizers notify early.  Australia also expressed satisfaction over the slight improvement 
recorded in the situation since th e last meeting of the Committee. 
II. OTHER MATTERS WITHIN THE PURVIEW OF THE COMMITTEE 
A. I MPLEMENTATION -RELATED ISSUES  
 48. The Chairman noted that the Committee was requi red to consider three distinct issues under 
this standing agenda item namely (i) elaborating di sciplines on export credits, export credit guarantees 
or insurance programmes as per Article 10.2 of the Agreement on Agriculture, (ii) examination of the 
implementation of NFIDC Decision, and (iii) admini stration of tariff quota regimes and submission of 
related addenda.   
49. As regards the NFIDC Decision, the Committee was also looking at the proposal by the 
African Group
9 relating, inter alia , to the establishment of a revolving fund as a possible means to 
                                                      
7 See G/AG/R/47, page 25. 
8 Subsequently issued as G/AG/N/CHE/35/Rev.1 (dated 4 April 2007). 
9 Paragraph 52 of TN/CTD/W/3/Rev.2 (dated 17 July 2002).  The proposal was initially submitted to 
the Committee on Trade in Development in Special Session. G/AG/R/48 
Page 10  
 
  address short term difficulties of LDCs and NFID Cs in financing commercial imports of basic 
foodstuffs.  In this context, the Chairman recalle d that a first report had been submitted three years 
ago to the General Council
10 , followed by another report containing a factual update in June 2006.11  
As regards the African Group proposal, the Chairman reported on his July 2006 report to the General 
Council where he had essentially reiterated that the s ituation remained unchanged since his May 2006 
report12 on this issue. 
50. Argentina stated that, without prejudice to the provisions of Article 10.1 of the Agreement on 
Agriculture with respect to circumvention of ex port subsidy commitments, the establishment of 
additional and specific disciplines on export cr edits, export credit guarantees and insurance 
programmes remained an outstanding implementation issue resulting from the Agreement on 
Agriculture of the Uruguay Round.  Argentina theref ore requested that this item be retained on the 
agenda of this Committee. 
B. WTO  LIST OF NET FOOD-IMPORTING DEVELOPING COUNTRIES  
 51. The Chairman noted that no new application had been received since March 2005.  The 
former list
13 therefore remained valid.  It currently co mprises:  (a) the LDCs as recognized by the 
Economic and Social Council of the United Nations;  and (b) 26 NFIDCs. 
C. E LECTION OF THE CHAIRPERSON  
 52. In light of the agreement reached at the mee ting of the Council on Trade in Goods (CTG) at 
its meeting on 19 March 2007, the Committee elect ed Ms Valeria Csukasi of Uruguay as the 
Chairman of the regular session of the Committee on Agriculture.  Ms V. Csukasi will hold office 
until the end of the first meeting of the Committee in 2008. 
53. A large number of delegations took the floor to  express their warm gratitude and individual 
appreciation to the outgoing Chairman, Mr. Christia n Häberli, for the professional manner in which he 
had conducted the Committee meetings since June 2005.   
D. O
THER BUSINESS  
 (i) Date of next meeting
 
 54. The next (49th) regular meeting of the Committee on Agriculture is scheduled to be held on 
Wednesday, 26 September 2007 .  On this basis, the convening airgram will be issued on Friday, 
14 September 2007, and the reminder airgram will be issued on Wednesday, 29 August 2007. 
                                                     
 
10 G/AG/16 (dated 4 July 2003) 
11 G/AG/16/Add.1 (dated 13 June 2006) 
12 G/AG/22 (dated 16 May 2006) 
13 G/AG/5/Rev.8 (dated 22 March 2005).  G/AG/R/48 
 Page 11 
 
 
  ANNEXES 
  
   Page
 
 
Annex 1 Summary of points raised with respect to notifications 12 
 Annex 2 Notifications subject to review  in respect of which no questions 36 
  have been raised in advance of the issuance of   the convening airgram  
 
    
 
  G/AG/R/48 
Page 12  
 
  Annex 1 
 
Summary of points raised with respect to notifications
 
 
 
 
Page  
 
(i) administration of tariff and other quota commitments (Table MA:1): 
- European Communities G/AG/N/EEC/1/Add.3, 3/Add.2, 
    14/Add.2 and 15/Add.2 13 
- Thailand G/AG/N/THA/62 13-14  
(ii) imports under tariff and other quot a commitments (Table MA:2): 
- China G/AG/N/CHN/9 14-15 
- Dominican Republic G/AG/N/DOM/11 15 
- Japan G/AG/N/JPN/123 15-16 - Korea G/AG/N/KOR/38 16 - South Africa G/AG/N/ZAF/61 17 - Thailand G/AG/N/THA/63 17  
(iii) special safeguard (Tables MA:3 to MA:5): 
- Japan G/AG/N/JPN/122 17 
- Korea G/AG/N/KOR/39 17-18 - Chinese Taipei G/AG/N/TPKM/43 18 - Chinese Taipei G/AG/N/TPKM/46 18 
  
(iv) domestic support commitments (Table DS:1): 
- Australia G/AG/N/AUS/65 19-20 
- European Communities G/AG/N/EEC/53 20-25 - Israel G/AG/N/ISR/41 25-26 - Japan G/AG//N/JPN/124 26-28 
- Korea G/AG/N/KOR/37 29-32 
 
(v) new or modified domestic support measures exempt from reduction (Table DS:2): 
- Armenia G/AG/N/ARM/6/Add.1 and 8/Add.1 33 
- Canada G/AG/N/CAN/64 33 
- Canada G/AG/N/CAN/65 33-34 
  
(vi) export subsidy commitments (Tables ES:1 to ES:3): 
- Japan G/AG/N/JPN/126 34 
- Korea G/AG/N/KOR/36 35 
 
________________ 
  G/AG/R/48 
 Page 13 
 
 
  (i) Table MA:1 
 
 EC    G/AG/N/EEC/1/Add.3, EEC/3/Add.2, EEC/14/Add.2, EEC/15/Add.2  
 
1. Question by Australia - The last EC notifica tion on tariff quota administration was in 
June 2001 as a result of the General Council decision (WT/L/384).  Given the lack of regular ad 
hoc notifications of changes to tariff quota administration, explanat ion sought, for each 
individual tariff quota listed in the notification , as to when the changes were implemented.  
Where a tariff quota is allocated to supplying coun tries, basis for determining the allocation and 
whether there is a limitation on the period of access, as required in G/AG/2, page 3.  Where 
licences are required, details sought  on allocation mechanism (e.g. first-come, first-served), as 
required in G/AG/2, page 3.  
 The tariff quotas were created or changed in th e period after the EC's last one-off notification 
in 2001, essentially on the basis of GATT Article XXVIII negotiations.  This was an attempt on the 
part of the EC to inform Members about the out come of GATT Article XXVIII negotiations before 
communicating the new EC Schedule which in cludes the results of GATT Article XXIV:6 
negotiations.  Details on the implementation of the tariff quotas are included in the annexes that were 
provided together with the G/AG/2 notification format .  This concerns the first implementation, as 
well as periods of access and the allocation method.  Follow-up comments:
  Australia underlined the need for timel y notifications as per the requirements 
contained in G/AG/2 and the importance of accessibilit y of the information in the main body of the 
notification rather than in the annexes.  The EC noted that this was not the only forum for providing 
relevant information on tariff quota management, and that the EC had notified such information to the 
Committee on Import Licensing Procedures as well.  2. Question by the United States -  The tariff quota  fill rate for pork continues to be low.  
Although, the EC has stated in the past that the applied administration method is not negatively impacting the fill rate, the United States continues to believe that the administration, including the use of separate product groupings with differe nt quantities for each group and the use of the 
"simultaneous examination" syst em, have a negative impact.  Explanation of the measures the 
EC is taking to ensure that exporters have th e opportunity to fully utilize this tariff quota.  
 In general, the pig meat market in the Europ ean Union is characterized  by sufficient supply at 
competitive prices.  The EC does not believe that the tariff quota administration system is negatively 
impacting on the fill rate.  Furthermore, the EC r ecalls that the change in the administration method 
for the pig meat tariff quota in question was effected  following a request made by the United States.  
There are examples where simultaneous examination leads to a 100 per cent quota fill, so it would not 
seem to be the method that causes the low fill rate. 
  Thailand   G/AG/N/THA/62
 
 
3. Question by Australia - Clarification of how th e tariff quota is allocated (e.g. first-come, 
first-served) for product (2) - milk  and cream, concentrated.  Definition of a 'juristic' person in 
the context of the notification to clarify who can access the tariff quotas.  
 The import quotas are allocated by demand from each juristic person applying for an import 
certificate.  The juristic persons are companies re gistered in Thailand whose businesses are related to 
the products in question.  
Follow-up comments:
  Australia requested further elabora tion on the tariff quota allocation methods. 
 G/AG/R/48 
Page 14  
 
  4. Question by the Philippines - Elaboration on the requirement for an importer to have 
historical performance during 2003-2005, in the allocation of tariff quota for desiccated coconut.  Whether Thailand is also providing oppo rtunity for new entrants to avail of the tariff 
quota allocations for desiccated coconut.  Detail s on the determination of the tariff quota 
allocations for coconuts for each of the periods lis ted in "other access arrangements" (item 6c in 
Table MA:1).  Reasons for limiting the period of importation for copra and coconut oil to 
November and December 2006.  Whether importat ion of these products under this tariff quota 
system is not allowed for the rest of the year.  
 Thailand is one of the major producers and e xporters of coconut, copra and coconut oil, 
therefore import demand for such products is ge nerally low.  The tariff quota volumes periodically 
allocated during the year reflect the import demand of the respective products.  Due to supply 
shortages of copra and coconut oil during November and December, the tariff quotas for such products are opened for imports during that period accordingly.  The tariff quotas are opened for juristic persons who demonstrate their need for such products.  With regard to the tariff quota 
allocated for new entrants, even though the histori cal performance of imported coconuts is one of the 
requirements for delivering the import certificate,  new entrants are welcome to apply for the 
certificate if they can demonstr ate the need for such product. 
 Follow-up comments:
  The Philippines requested further clarification on the period of importation for 
copra and coconut oil and sought confirmation that importation was not permitted during the rest of 
the year.  
 
5. Question by the United States – Concerns over application of domestic purchase 
requirements to some tariff quotas (i.e., soybeans , soybean meal, corn, skimmed milk, and fresh 
potatoes).  Explanation sought on tariff quota allocation methods.  
 The import quotas are allocated in accordance with the demand of each juristic person who 
applies for import certificates.  The Thai governme nt does not enact any legal regulation requiring 
domestic purchase of products in question.  Duri ng the past few years, the committed quota quantity 
of soybeans, skimmed milk, and fresh pota toes exceeded the quantities committed under WTO. 
 Follow-up comments:
  The United States sought detailed information on tariff quota allocation 
especially with respect to domestic purchase requirements. 
 
(ii) Table MA:2 
 
 China    G/AG/N/CHN/9  
 6. Question by Australia  - Noted that on a number of products (wheat, corn, rice, soya 
bean oil, rape seed oil), China has recorded significant underfill and sought reasons for it.  
 To implement its accession commitments, Chin a allocates tariff quotas to qualified importers 
by the end of each year. Importers who obtain tariff quota shares take their own import decisions according to market demand.   
 
 In the case of certain tariff quot as, the low fill rates were due to the fact that domestic supply 
of grains remained ample after ha rvests as well as to the extensi on of fine varieties in China.  
International prices experienced a large increase dur ing the same period and import costs were much 
higher than the domestic prices.  Imports therefore sh rank in some years.  For some products, the fill 
rates were quite high.   
  G/AG/R/48 
 Page 15 
 
 
   The changes of domestic demand determine th e import volume of grains, which varies from 
one year to the other.  In 2004, Chinese enterpri ses imported 7.26 million tonnes of wheat.  The fill 
rate for that year reached 75 per cent.  The practi ce of the past few years shows that the tariff quota 
system played an important role in food security a nd stability of the Chinese grains market.  So far, 
China has no plans to terminate the tariff quota syst em. As far as vegetable oils are concerned, China 
has not maintained any tariff quotas for since 2006,  in accordance with its  accession commitments. 
 
7. Question by the United States - Explanation of tariff quota allocation method for cotton.  
Understood that, in at least one case, an a dditional tariff quota was allocated with a 
requirement to purchase equal amounts of domestic cotton.  
 There is no requirement for importers to purchase equal amounts of domestic cotton when 
tariff quota shares are allocated.  The allocation me thod is described in Announcement Number 58 of 
the National Development and Reform Commission (NDRC).14   
 Follow-up comments:
  Referring to the recent High Level Session on Cotton, the United States noted 
that from the demand side of cotton, it was important to look at the cotton tariff quota in China which 
is the largest importer of cotton.  While appreci ating that China imports much more than the 
scheduled tariff quota quantity of cotton, the Unit ed States expressed concerns at the less than 
transparent tariff quota allocation.  
 
 Dominican Republic   G/AG/N/DOM/11  
 
8. Question by the United States – The United States is concerned that the tariff quota 
administration method continues to preven t some imports from entering.  The current 
notification shows that there was no trade under the chicken tariff quota (10,500 tonnes) 
in 2003, and only 780 tonnes were imported under the 2004 tariff quota (11,500 tonnes).  
Reasons for continued underfill.  
 The Dominican Republic confirms that the government has not refused any permit for the 
import of chicken meat into the country. Ther e are no restrictive measures in place in the 
implementation of the chicken meat tariff quota.  Au thorities have informed that low imports of this 
product could arise because of large quantities of do mestic production leading to a drop in domestic 
prices of chicken meat compared to the internati onal prices.  This has impacted profit margins for 
importers who refrained fro m importing chicken meat. 
  Japan   G/AG/N/JPN/123
 
 
9. Question by Australia - Noted the significan t underfill on a number of products (e.g., 
skimmed milk powder, whey, butter and butter oil, leguminous vegetables, ground nuts, 
konnyaku and raw silk): reasons for it; whether Japan considers it necessary to retain tariff 
quotas on these items if lack of market dema nd is the reason given for the low fill rates.  
 Under the tariff quota system, Members are committed to providing access opportunities for 
products, but they are not committed to filling the tariff quotas. The tariff quotas in question remained 
underfilled because the total volume of applications  was less than the tariff quota volume.  Japan 
publicly announces, in bulletins on tariff quota admini stration, all tariff quotas to be allocated, and 
ensures that tariff quota shares are allocated to all eligible applications within the total tariff quota 
volume.  Japan does not consider it necessary to cha nge its tariff quota system merely because market 
demand is not sufficient and the fill rate is, accordingly, low. 
                                                      
14 "2006 TRQ Volumes, Application Requirements and Allocating Principles for Imported Grains and 
Cotton", published on 13 September 2005 (available on the NDRC website).  G/AG/R/48 
Page 16  
 
   
10. Question by New Zealand - Noted that, since 1995, the fill rate for some dairy tariff 
quotas remains below 50 per cent and that lack of domestic demand continues to be the reason 
given by Japan.  If demand has remained consiste ntly low (not only for some imported dairy 
products but also domestic
 products), surely the maintenance of a strict tariff quota regime has 
become unnecessary?   
 Please refer to the reply given by Japan to th e question posed by Australia in paragraph 9 
above.  
11. Question by New Zealand - Japan has been operating a reallocation mechanism across 
these tariff quotas.  To what extent has this  mechanism boosted demand for the tariff quota 
products?  
 Japan introduced a reallocation mechanism across all tariff quotas since 1 April 2003.  After 
2003, for some products, the tariff quotas became fully filled due to a well-managed reallocation 
scheme.  However, Japan considers that this mechanism is just to expand access opportunities under 
certain market demand conditions, but does not  contribute to boosting market demand. 
  Korea   G/AG/N/KOR/38
 
 
12. Question by Australia - Noted that signific ant underfill, or even zero fill, has been 
recorded for four consecutive years (2001-2004) with  respect to many products (e.g. birds' eggs, 
milk & cream, fruit trees, citrus fruits, sorghum, oilcake, sweet potato, ba rley): reasons for it;  
whether it is necessary to retain tariff quotas on  these items if lack of market demand is the 
reason given for the low fill rates.  
 The reasons for such low fill rates can be said to be mainly of an economic nature, including 
price decreases in domestic agricultural products, price increases in imported agricultural products, or 
reduced demand due to economic slow-down, to name  a few.  Regarding the necessity of maintaining 
tariff quotas for the products with low fill rates, Ko rea considers that there are various reasons for 
maintaining the tariff quotas.  Market demand ma y change.  Korea does not see low market demand 
as a reason for removing the tariff quotas.  13. Question by Australia – In G/AG/N/KOR/11, KOR/21 and KOR/33, Korea notified that 
import arrangements ceased applying for white s ilk, bovine meat and meat of swine and fowls, 
and orange juice, at specific points in time: rea sons for notifying imports for white silk tariff 
quota, but not for the other quotas that ceased to apply; confirmation that white silk imports 
are still free of quota arrangements.  
 Korea abolished tariff quota schemes for swin e meat, fowl meat and orange juice in 
July 1997, and for beef (meat and edible offal of bovine) in 2002.  Since then, Korea has been 
applying only MFN tariffs to those products.  Howeve r, in the case of white silk, Korea eliminated the 
remaining import restrictions other than tariff quot a in July 1997, and has been maintaining tariff 
quotas as specified in Korea's Schedule.  The white si lk tariff quota is being administered according to 
its import management scheme. 
  G/AG/R/48 
 Page 17 
 
 
   South Africa   G/AG/N/ZAF/61  
 
14. Question by New Zealand - Noted that the tariff quotas for milk and cream (fresh) and 
butter have not been filled during the reporting periods 2004 and 2005: reasons for it; whether 
a review of the tariff quota administration method , or a change to a tariff-only scheme for milk, 
cream and butter is being considered by South Africa.  
 No tariff quota is being administered for milk and cream, fresh (HS 0401) as the applied tariff 
is zero.  Regarding butter (HS 0405), in both 2004 an d 2005, all import permits have been issued, but 
permit holders did not make use of all their alloca tions.  According to industry sources, there was 
sufficient local supply of butter and local prices we re competitive with international prices.  Imports 
were therefore low.  As regards the possible change  to a tariff-only scheme for milk, cream and butter, 
South Africa would prefer a tariff-only scheme but is not in a situation to do this unilaterally.  The 
system for tariff quota administration is reviewed on  a regular basis. South Africa is convinced that 
market conditions, and not tariff quota administra tion, are responsible for those exceptional cases 
where low fill rates do occur.  
 Thailand   G/AG/N/THA/63
 
 
15. Question by the Philippines – Reasons for lo w in-quota imports for coconut, including 
desiccated (only 4.5 per cent of the tariff quota  quantity for calendar year 2005); reasons for 
lack of in-quota imports for both  copra and coconut oil.  Given the minimal or nil importation, 
even under low in-quota tariffs, whether Thaila nd would consider applying a tariff-only scheme 
for these products.  
The question has been transmitted to the capital.  Thailand undertook to provide a response at 
a later stage. 
 
(iii) Tables MA:3 to MA:5  
 
 Japan    G/AG/N/JPN/122   
 
16. Question by Australia - Noted that the vol ume-based trigger for 'Yogurt; frozen' is 
0.17 tonnes.  Reasons for invoking this safeguard at such a low level.  
 The volume-based safeguard was applied, just as stipulated in the Agreement on Agriculture, 
when the import volume exceeded the trigger level, which is calculated in accordance with Article 5 
of the Agreement. The data concerning the import vol ume used for the application of this safeguard 
have been already notified.   Follow-up comments:
  Australia wondered whether it was d esirable to invoke safeguard actions at 
such low volume trigger levels. 
  Korea    G/AG/N/KOR/39
 
 
17. Question by Australia - Noted that brackete d quantities are included next to the dates 
for which a volume- or price-based action was taken.  Clarification sought in this regard.   
 The bracketed quantities next to the dates ar e the quantities on which Korea has applied the 
special safeguard actions . 
 G/AG/R/48 
Page 18  
 
  18. Question by Australia - Noted that there are cases where both price- and volume-based 
actions were taken in the same period (e.g. buckwhe at in 2001).  The notification explains that if 
both the price- and volume-based special safe guard were applicable to the same import 
consignment, the additional duty would be ref unded since both measures cannot be applied 
concurrently.  Explanation sought on how Ko rea determined which safeguard measure was 
applicable in situations where both safeguar d actions were triggered concurrently; whether 
Korea believes that these actions are permitted under Article 5 of the Agreement on Agriculture.  
 According to Korea's customs regulations, the price-based and volume-based special 
safeguards cannot be triggered concurrently on the same import consignment.  If both the price-based 
and volume-based special safeguards were applicab le on an import consignment, only one of them 
would be applied.  In the case of buckwheat, for which the imports increased sharply in 2001, some 
import consignments met both the price-based and volume-based tr iggers.  In such cases, Korea 
selected only one of the two triggering mechanisms  on the basis of which the higher additional duty 
could be imposed. 
   
 Korea reiterated that, in accordance with Article  5 of the Agreement on Agriculture as well as 
in accordance with Korea's customs regulations, Korea did not apply both the price-based and 
volume-based special safeguards to buckwheat, at the same time. 
   Chinese Taipei   G/AG/N/TPKM/43
 
 19. Question by Australia - Noted that the volum e-based trigger for 'shaddock' is zero.  
Reasons for invoking the safeguard with a zero trigger.  
 The calculation and safeguard action is in full accordance with Article 5 of the Agreement on 
Agriculture.  Because Chinese Taipei's trading part ners could not meet its SPS requirements, there 
was no importation of shaddock during the preceding three years, from 2003 to 2005.  Furthermore, 
domestic consumption decreased from 2004 to 2005.  Consequently, the trigger volume is zero.  
Nevertheless, Chinese Taipei reaffirms that no saf eguard duties will be applied to the in-quota 
imports. 
  Chinese Taipei    G/AG/N/TPKM/46
 
 20. Question by New Zealand - Noted that, fr om 14 September to 31 December 2006, a 
volume-based special safeguard was applied on "liquid milk", and that from 27 March 2006, a price-based special safeguard action was also a pplied. Given that the "liquid milk" tariff quota 
was underfilled in the previous year, confirmation is  sought that it has been filled this year and 
that no special safeguard actions were a pplied on imports within the tariff quota.  
 Chinese Taipei recalled that it responded to th e same question raised by the delegation of 
New Zealand at the 47th Regular Meeting of th e Committee on Agriculture held in October 2006.
15   
Chinese Taipei confirms that the calculation and safe guard action is in full accordance with Article 5 
of the Agreement on Agriculture.  The relevant provisions of Article 5 do not establish any link 
between the application of the safeguard and tari ff quota fill.  Chinese Taipei confirms that no 
safeguard duties will be applied to in-quota imports.  
                                                     
 
15 See G/AG/R/47, pages 17-18.  G/AG/R/48 
 Page 19 
 
 
  (iv) Table DS:1 
 
 Australia    G/AG/N/AUS/65  
 
21. Question by the Philippines – Green Box : information sought on "structural adjustment 
assistance through investment aids" in New Sout h Wales and Victoria; consistency with Annex 
2, paragraph 11 criteria. Considering that these assistance schemes involve improvements in 
productivity, explanation of compliance with the requirement in paragraph 11(b).  Timeframes for implementation and consistency with par agraph 11(d) criteria. Clarification sought 
regarding the objective of improving the "long -term" productivity of farming properties, under 
the Productivity Enhancement Package in Victoria (PEP).  
 Structural adjustment assistance is provided by the New South Wales Government through (i) 
an interest rate subsidy and (ii) a debt re-str ucturing grant. These measures are designed to assist 
landowners re-structure their debt s in order to improve the financ ial management of their farming 
enterprise.  The interest rate subsidy cannot exceed  80 per cent of the total interest payable on, and 
associated costs of, the loan in an y one year. In accordance with paragraph 11(b) of Annex 2, these 
payments are not related to, or based on, type or  volume of production undertaken by the producer. 
The debt re-structuring grant is no more than 80 per cent of the one-off costs associated with debt and 
capital re-structuring where funded on commercia l terms and conditions.  In accordance with 
paragraph 11(b) of Annex 2, these payments are no t related to, or based on, type or volume of 
production undertaken by the producer.    
 
 Both initiatives are components of the broa der West 2000 Plus Programme (WPP) of Green 
Box measures.  While the broader WPP is notified under 'regional assistance programmes' (paragraph 
13 of Annex 2), the above two components are notifie d separately as 'investment aids' (paragraph 11).  
Expenditure for these two investment aids totalle d $A0.17 million in the 2005-06 fiscal year.  The 
WPP is open to all landholders in the Western Division of New South Wales and aims to assist 
landholders improve their farmi ng operations though improvement of business, management and 
technical skills;  funding for activities that facilita te the provision of information, networking and 
advice on alternative industry opportunities;  unde rtaking specific natura l resource management 
activities and facilitation of rural restructuring and adequate counsellin g support. As regards 
implementation timeframes, the New South Wales Government interest ra te subsidy and debt-
restructuring grant may be provided for up to 5 y ears following approval of an application.  No 
payment will be made in respect of inte rest accrued beyond 11 December 2008.   
  The Victorian State Government Productivit y Enhancement Program (PEP) was established 
to encourage structural adjustment through th e adoption of new technol ogy and improved farm 
management strategies.  The 2.5 per cent inter est rate subsidy provided under the PEP for total 
investment borrowings up to $A0.25 million was ai med at improving long-term farm productivity, 
efficiency and sustainability.  In accordance with paragraph 11(b) of Annex 2, the payments were not 
related to, or based on, type or volume of prod uction undertaken by the producer. Expenditure under 
the PEP had been very low prior to the conclusion of the PEP during the 2005-06 fiscal year.  Only 
$A0.1 million had been expended since the 2003-04 fiscal year until the conclusion of the 
programme.  As regards implemen tation timeframes, the PEP provided a 2.5 per cent interest rate 
subsidy for up to three years on total borrowi ngs up to $A250,000.  The PEP ceased operation during 
the 2005-06 fiscal year.     Payments under the New South Wales and ( now ceased) Victorian programmes are provided 
for a period of time necessary to enable structural ad justment to take place.  Further, payments to 
producers would cease if the borrowings associated with th e structural adjustment were re-paid in full.  
These payments are therefore limited to the 'period of time necessary for the realisation of the investment' and are consistent with paragraph 11( d) of Annex 2. The use of the phrase "long-term" G/AG/R/48 
Page 20  
 
  productivity was used to indicate th at if a farmer adopts new strategies and technology they are more 
than likely to continue to be a viable farming opera tion in the long term.  The use of this phrase does 
not refer to the length or timing of payments under the PEP.  Follow-up comments:
  The Philippines indicated that the r eason for raising these questions was the 
use of the term "productivity" which coul d imply some linkage with production. 
 
22. Question by the Philippines – Green Box : details and explanation sought on (a) the 
difference between the (i) exotic animal disea se preparedness programme (EADPP); and (ii) 
wildlife and exotic disease preparedness programme (WEDPP); and (b) compliance of each 
programme with the criteria contained in paragraph 2 of Annex 2.  
 The EADPP establishes training courses to veteri narians in exotic animal disease awareness, 
recognition and reporting. It is directly aimed at improving exotic animal disease monitoring and 
control measures, and is therefore consistent with paragraph 2(b) of Annex 2.  In 2005-06, total 
expenditure under the EADPP was $A0.08 million. 
 
 The WEDPP aims to facilitate the development of  practical field strategies for the eradication, 
control and management of feral animals in an exotic disease outbreak.  Programme objectives include identifying key risk areas for exotic disease;  determining the most effective population survey 
methods; encouraging improvements in techniques;  assessing cost effectiveness of control techniques 
and reviewing animal welfare aspects and to devel op contingency plans based on this information.  
This programme is aimed directly at monitoring and controlling pest and disease outbreaks, and is 
therefore consistent with paragra ph 2(b) of Annex 2.  In 2005-06,  total expenditure under the WEDPP 
was $A0.28 million.  
23. Question by Thailand – Clarification sought on the type of support measures used by 
the Australian Government for managing a nd operating public stockholding programmes for 
food security purposes.  
 The question was withdrawn by Thailand.  Howeve r, for the record, Australia stated that the 
Australian Government (including all state and terr itory Governments) did not maintain any public 
stockholding programmes for food security purposes, and therefore had not incurred any expenditure 
under this heading. 
 
 European Communities   G/AG/N/EEC/53
 
 
24. Question by Australia - EC enlargement  - Noted that on page 18, the EC advises that the 
notification covers support to the European Un ion after enlargement on  1 May 2004, and that 
price gap calculations are performed for the EC-25 for a 12-month period.  Confirmation 
sought as regards the start and end dates for th e 12-month periods for:  (i) total AMS;  (ii) 
product specific AMS.  Clarification as to wh ether separate notifications will be provided for 
the 10 new EC member States if their domestic support is not included, or only partially 
included, in the 2003/2004 domestic support notifica tion.  Clarification of the statement, on page 
18, to the effect that the total AMS cited for 2003 is " without prejudice to the EC-25 commitment 
to be presented in the new EC-25 schedule after enlargement "?  As EC-25 enlargement has been 
in place since May 2004, when does the EC in tend to present its proposed commitments for 
examination by the WTO Membership?  Whether the EC could inform the Membership of its proposed EC-25 commitment.  
 As regards the start and end dates for AMS a nd product-specific AMS, the EC refers to its 
reply to the question posed by Canada in para graph 32 below.  All domestic support for the new 
member States is included in the present notification and no separate notifications will be provided.   G/AG/R/48 
 Page 21 
 
 
  The statement on page 18 of the notification make s clear that, for the period concerned, the EC 
applied the AMS ceiling of the EC-15 Schedule.  But the Membership will be aware that the EC intends to present a revised Schedule.  The EC also re fers to the reply it gave in paragraph 7 in page 2 
above.  25. Question by Australia – Member States measures and expenditure
: noted that the 
payments notified all appear to relate to  EC programmes and to expenditure from the 
European Agricultural Guidance and Guarantee Fund (EAGGF) budget, with the exception of direct aid for sugar by Italy.  Whether the EC or the relevant EC member State could provide details of programmes and expenditure at the memb er State level - including in regard to the 
programmes itemized in the notification, toge ther with any other member State programmes 
not included in the EC itemized list in respect of Green Box measures, programmes; exempt direct payments; product-specific market price support.  In respect of EC-wide programmes and/or those programmes for which the EC a nd member States have shared competencies, 
whether the EC could advise of payments from member State budgets, including those 
measures which might be partly fi nanced by EAGGF and member States.  
 The European Communities notify comprehe nsively as a single entity to the WTO. 
 
26. Question by Australia - Product-specific support
 - Notes that the EC lists ethyl alcohol 
of agricultural origin as a basic agricultural pr oduct, whereas less highly processed products 
are not listed as such.  Reason for this apparent anomaly; elaboration of the product description 
(e.g. an HS line); details of the measures in qu estion – including whether the support is payable 
to the ethyl alcohol producer or to the grower - and the basic crop products eligible for such 
support, together with the support to such cro p products at product-specific level under the 
ethyl alcohol programme.  
The reason why ethyl alcohol is listed separately is  the entry into force of a specific regulation 
laying down specific measures concer ning the market in ethyl alcohol of agricultural origin (Council 
Regulation 670 of 2003).  The support concerns a transitional national aid granted in Germany to 
certain alcohol producers who obtain ethyl alcohol  from various agricultural raw materials.  The 
producers receive a guaranteed price for the alcohol. 
27. Question by Australia - Product-specific AMS (fruit and vegetable products for 
processing) : Whether the production aids are granted to the growers or to processors; whether 
such aids are fixed or variable (for instance linke d to world prices of the basic and/or processed 
product); details of the processing aid for dried fo dder, including whether the aid is limited to 
processing of crops of EC origin.  
For details on the support in the sector of pro cessed fruits the EC recommend to refer to the 
following document in their web site.16  It is to be noted that the regime will be subject to reforms.  
Information on the Commission proposals can also be found on the website.17 The implementation of 
the support for dried fodder during th e period under review was complying with the conditions set out 
in Council Regulation 603/95.  In the meantime the sector was reformed.18 
 
                                                      
16 http://ec.europa.eu/agricu lture/capreform/fruitveg/presentations/proc_en.pdf. 
17 http://ec.europa.eu/agriculture /markets/fruitveg/index_en.htm. 
18 http://europa.eu/eur-lex/en/consleg/pdf/2003/en_2003R1786_do_001.pdf for further details on 
Council Regulation 1786/2003. G/AG/R/48 
Page 22  
 
  28. Question by Australia – Green Box
:  Explanation sought for the increase in expenditure 
under payments for relief from natural disasters (from €398.8 million in 2001/02 to €811.1 million in 2002/03), including eligibility criteri a for payments.  Information sought on the 
"restoration of agricultural production potential" , including an outline of expenditure.  Details 
on how the EC assesses the loss caused by th e natural disaster in order to ensure that 
compensation provided under this programme is co nsistent with paragraph 8(d) of Annex 2, 
and that producers are not over-compensated?  
 Without further research the EC cannot give an explanation for the volume increase in aids 
for natural disaster relief between 2001/02 and 2002/03, but most likely, the increase is a consequence 
of an increased occurrence of natural disasters in  the period 2002/03.  There was no change in legal 
basis that could have triggered an increase in na tural disaster compensation aids.  Equally, without 
further research the Commission does not have in formation on the restoration of agricultural 
production potential and the expenditu re related to it.  Consistency with the provisions of paragraph 
8(d) of Annex 2 is ensured in the Community Guide lines for State Aid in the Agriculture Sector as the 
same rules apply with regard to  eligibility, compensable losses a nd the provision of avoidance of 
over-compensation. 
 
29. Question by Australia – Green Box:
  Noted the notified level of expenditures in 2002/03 
and 2003/04 respectively on environmental program mes. Details on operation of environmental 
programmes, and specifically basis for calc ulating the payments to farmers who are 
participating in the programme; existence of  production restrictions on farming units.  
 The EC applies agri-environmental measur es which support farmers who make voluntary 
commitments going beyond the baseline level and w ho help to protect the environment and maintain 
the countryside.  Until 2006 the baseline level has b een the usual Good Farming Practices, as defined 
by member States in the Rural Development progr ammes.  For the period 2007-2013, the baseline 
will be the Cross-Compliance standards, plus mini mum requirements for fertiliser and plant protection 
product use, plus any other relevant mandatory requ irements established by national legislation and 
identified in the Rural Developmen t programmes.  The payment levels are calculated by member 
States on the basis of additional costs and income fo regone in comparison to the baseline level and the 
normal practice.  The restrictions/obligations to be respected by beneficiaries for the duration of the contract (normally five years), will depend on the specific content of the agri-environmental 
commitments. These are very varied and can c over, for example: environmentally-favourable 
extensification of farming; ma nagement of low-intensity pasture systems; integrated farm 
management and organic farming;  preservation of landscape, and historical features such as 
hedgerows, ditches and woods;  con servation of high-value habitats and their associated biodiversity. 
 Follow-up comments:
  Australia reiterated its question regardi ng the existence of any restrictions on 
production under these environmental pr ogrammes.  The EC clarified that restrictions were placed on 
production practices.  
30. Question by Australia – Blue Box
 - To allow Australia to better assess the degree of 
subsidization, details requested on the calculatio n of the gross value of agricultural production 
(GVP) for each product notified in  Supporting Table DS:3 (ST/DS:3)  
 With the exception of oilseeds protein plants  and grass for silage, the production values for 
the products contained in ST/DS:3 can be found in ST/DS:4, column 4, for both years notified.  The production value for grass for silage is not availabl e.  The production value, at producer prices, for 
oilseeds was €2.939 million in 2002 (EC-15) and €3. 700 million in 2003 (EC-25).  For protein crops, 
these values were €564 million and €664 million, respectively. 
  G/AG/R/48 
 Page 23 
 
 
  31. Question by Australia - AMS  - Noted that for many of the commodities a production 
value is missing ("n.a.") from ST/DS:4, but ea ch of these commodities is accorded a product-
specific AMS or equivalent measure of support (EMS).  Reasons for not including the production values for all the products listed in  ST/DS:4, especially bananas; whether missing 
production values could be supplied.  
 The missing data are not available from reliabl e sources.  In those cases where the data on 
production value are not available, the product-specific AMS is counted in full in the calculation of the Current Total AMS.  Follow-up comments:
  Australia sought an explanation as to how the EC made its de minimis  claims 
in the absence of value of production data.  The EC reiterated that, when ther e were no reliable data, 
the entire support was included in the calculation of the Current Total AMS.  
32. Question by Canada - Noted the footnote (* ) in Table DS:1 for 2003/04 and sought the 
following clarifications: reporting year (e.g ., "calendar", "fiscal") for any payments or 
expenditures (such as general services) that ar e not normally reported on a "marketing year" 
basis; when such a reporting year starts; sinc e the footnote refers to "a 12 month period", 
whether this period includes 1 May 2004 in all cases; where payments or expenditures are 
notified for a reporting period other than a "marketing year", extent to which such amounts are included in the notification for the 10 new member States after 1 May 2004, for marketing 
year 2003/04?  
 The notification covers several reference peri ods.  For price gap calculations the reference 
period for WTO year is the marketing year 2003/04.  The beginning of a marketing year can vary according to the product concerned.  In all cases the bulk of the support paid falls in the EAGGF 
financial year 2004. For EAGGF expenditure, th e reference period is from 16 October 2003 to 
15 October 2004.  In gene ral, EC member States' support is accounted for within the period 1 January 
2004 to 31 December 2004.  All reference peri ods include 1 May 2004.  EAGGF Blue and Amber 
direct payments in the 10 new EC member States were still rather limited during the reporting year 2003/2004.  
33. Question by Canada - In 2002/03 the "Compensatory payments for ewes and goats …" 
increased to almost five times the amount repor ted in 2001/02.  Details sought on the factors 
accounting for this increase, i.e. whether the in crease arises from changes in the premium rate, 
reference numbers, technical coefficients, or other factors.  
 The main reason for the difference is the low level of expenditure during the year 2001/02 
rather than the high level of expenditure in 2002/03 caused by a shift of payments from the EAGGF 
year 2002 to the EAGGF year 2003. 
 
34. Question by Canada – Noted that "Ethyl alcohol of agricultural origin" has been 
notified in ST/DS:8 for the first time in 2003/ 04, which coincides with the beginning of the 
reporting for the EC-25: whether this type of "n ational aid" has been previously included in the 
support notified for wine; difference between "Dis tillation aids for specific uses" reported with 
respect to wine and "National aid" reported with respect to "Ethyl alcohol of agricultural origin"; proportion of the notified €98.9 millio n which refers to support in the 10 new member 
States.  
 The support for ethyl alcohol of agricultural origin was not previously included under the 
support for wine.  The two support systems are not rela ted.  The support for ethyl alcohol is a national 
support measure applied only in Germany in confor mity with Article 10 of Council Regulation (EC) 
no. 630 of 2003. G/AG/R/48 
Page 24  
 
   
35. Question by Japan – Noted that AMS support  for "Ethyl alcohol of agricultural origin" 
has been notified in ST/DS:8 for the first time in 2003/04.  While support for manufacturing and 
marketing facilities could be categorized as  a non-agricultural measure and support for 
research on ethyl alcohol production could be categorized as a "green" measure, Japan sought 
clarification as to the types of support which could be categorized as AMS measures which are 
supposed to affect agricultural production and trade.  
 The support concerned is an Amber Box m easure offering a price guarantee to farmers 
producing ethyl alcohol of agricultural origin.  36. Question by New Zealand - Green Box
: Noted that, under "Payments for relief from 
natural disasters", there appears to be a new le gal framework for the programme, indicated by 
'2000/C28/02'.  Provision of a Table DS:2 notification format describing the details of this new programme and how it meets the appropriate criteria.  
 2000/C28/02 establishes the Community Guidelines for State Aid in the Agricultural Sector.  
Since these Guidelines do not establish specific progr ammes, the EC sees no reason for a Table DS:2 
notification called for by Article 18:3 of the Agreement of Agriculture.  
37. Question by New Zealand – Green Box
 - Details sought on what constitutes "Other farm 
services" under the "General Services" category.  In that context, noted that expenditure on 
these programmes had more than tripled (from  €36.2 million in 2000- 01 to €122.6 million 
in 2003-04); that paragraph 2 of Annex 2 cont ained seven sub-paragraphs, that the EC's 
notification listed programmes beside all seven , but that the eighth line, "Other", did not 
appear to correspond to any of these categories.  On  previous occasions, the EC had only stated 
that the programmes did not involve direct payments to producers.  Request for more 
information and more detailed description of th e programmes; whether the EC could specify 
which section of Annex 2 it considers that th ese programmes qualify for, and explain how the 
programmes meet the criteria stipulated in that section.  
 The EC refer to the introduction to the list of  general services from paragraph 2 of Annex 2, 
where apart from a statement that no direct paymen ts to producers or processors are involved, it is 
said that programmes can be included in the list, but that programmes are not restricted to this list.  
From the description in column 2 of the notifi cation New Zealand can draw a conclusion about the 
type of measures concerned. 
 Follow-up comments:
  New Zealand reiterated its request for further details on "Other farm services" 
and the EC stated that it would look into that matter.   38. Question by South Africa – Green Box
:  Noted that the expenditure under "Structural 
Adjustment Assistance provided through invest ment Aids" amounted to €5,264.9 million in 
2002/03 and €6,821.7 million in 2003/04.  Request fo r further details with respect to "Aid to 
young farmers", a programme listed under that category, in particular:  value of expenditures on that programme in the mentioned years; el igibility criteria applied to "young farmers"; 
definition of "young farmer";  programme requirements;  criteria on the basis of which such 
support is claimed as "green".  
 The method of data collection does not allow fo r the isolation of the expenditure for this 
specific measure.  A rough estimate would indicat e at least €500 million per annum for this specific 
measure.  To qualify for the support the farmer has to possess adequate occupational skills and 
competence and must be setting up on an agricultural holding for the first time, and be established as 
head of the holding.  The economic viability of the holding must be demonstrated and minimum  G/AG/R/48 
 Page 25 
 
 
  environmental, hygiene, and animal welfare standard s are to be complied with.  The farmer must be 
under 40 years of age.  The setting-up aid compri ses a single premium up to the maximum eligible 
amount specified of €25,000 and an interest subsidy on loans taken, with a view to covering the costs 
arising from setting up the farm.  The capitalized value of the interest subsidy may not exceed the value of the premium.  The support qualifies fo r inclusion in the Green Box because the measure 
complies with the criteria contained in paragraph 11 of Annex 2. 
 
39. Question by the United States – Based on a survey of budget documents, the United 
Sates found that there were other EC funding so urces which supported agriculture in various 
ways that were not included in the EAGGF, and were not included in this notification.  
Explanation and confirmation sought that the EC has reported all supports.  
 The notification under review was establishe d according to the same method as in previous 
years using EAGGF data and information from member States on State Aids.  The EC is not aware of any missing data.  40. Question by the United States - Explanation for the dramatic drop in the beef AMS 
from around €10 billion in the 2000/01 and 2001/ 02 notifications to zero.  Request for more 
information on how the applied administered price is determined.  
 The administrative price for beef in the EU fe ll below the external reference price, rendering 
support in the beef sector negative and therefor e zero. The applied administered price is the 
intervention price of €1,560/tonne. 
 
41. Question by the United States - Further explanat ion sought on the measures used for the 
"support and protection of organic  production by creating conditions of fair competition"; 
whether there is a definition of "fair" in terms of the policy measures used.  
 There is no definition of "fair" in terms of the policy measures used.  Under the Rural 
Development policies member States have to a dopt appropriate environm ental protection measures 
relating to all types of agricultural activities.  Fa rmers are now expected to respect certain basic 
environmental standards without any financial co mpensation and the "polluter-pays" principle is 
being applied.  Agri-environmental measures under the rural devel opment programmes offer 
payments to farmers for environmental commitmen ts that go beyond a baseline of standards to be 
respected by farmers.  Organic farmers are placed  on an equal footing and are entitled to claim agri-
environmental premiums since it is recognized that  this particular farming system benefits the 
environment.   Israel   G/AG/N/ISR/41
 
 42. Question from New Zealand – Green Box
: Noted the significant expenditure (US$7.7 
million) on a new programme, 'Environment reform  in the dairy farms'.  Submission of a Table 
DS:2 notification detailing how exactly this pr ogramme meets the criteria set out in paragraphs 
1 and 12 of Annex 2.  
 The decade-long reform in the dairy sect or was launched in the mid-1990s as a joint 
programme carried out by the Ministry of Environment and the Ministry of Agriculture and Rural 
Development.  The reform followed a long-lasting de bate over the impact of the infiltration of dairy 
farms sewage liquids to the groundwater, as well as the quality of the groundwater reservoirs.  The 
affected groundwater account for about two-thirds  of the potable water sources available to the 
population.  Decades of monitoring (from the 1960s onwar ds), data collection, and formation of time-
series, revealed that the groundwater quality, especia lly in the aquifer of the Coastal Strip (between 
Tel-Aviv and Haifa, where a majority of the popul ation lives and many family farms are located) has G/AG/R/48 
Page 26  
 
  gradually been deteriorated, due to contaminati on.  This contamination came from a variety of 
industrial and agricultural sources, and to a large ex tent, from dairy farms.  Hydrologists and water 
management experts predicted that, in the absen ce of firm measures to prevent the further 
deterioration of the water quality of the "Coastal A quifer" and other national wa ter reservoirs, a "point 
of no return" could be faced, whereby these crucial water reservoirs might become useless.  One of 
the major steps taken in that respect was the "Env ironment reform in the dairy farms in Israel",  
launched in the mid-1990s and lasting fo r about a decade, until termination. 
  Prior to the launching of the reform, the major ity of small-scale family farms as well as large-
scale Kibbutz dairy farms practised traditional farming techniques.  They possessed old cowsheds that 
had no concrete (cemented) gro unding.  Sewage liquids were rel eased to the groundwater reservoirs 
thus making each and every dairy farm a contamination centre.  As part of the reform work-plan, the 
entire dairy farm sector had to be modernized resulting in an overall renovation of the dairy housing 
facilities and cowsheds. Among the compulsory features,  all the buildings destined to milking cows 
and their offspring had to have cemented groundings (including ot her countervailing measures) thus 
making all the installations sterile and preventing an y further leakages of fluids to the groundwater 
reservoirs. This modernization process was to be  funded by the farmers, with governmental 
assistance, on a fifty-fifty basis.     The heavy financial burden to modernize the dair y sector and the gradual decrease of the milk 
price at farm-gate (pursuant to international commitm ents to reduce subsidies), would potentially lead 
to a situation where only the larger and most effi cient farms would survive.  The implementation of 
the reform eventually resulted in a structural change of the dairy sector.  Many farms went into 
merger projects and many (particularly the elderly farmers) withdrew from production.  
Consequently, the number of active dairy farms was more than halved, although the rate of milk 
production has not diminished. The government budgetary system (implemented by the two 
aforementioned Ministries) had channelled assistance to those dairy farms which implemented the 
reform with instalments based upon the progress made by each individual farm. The rate of government assistance increased over the years as the re form took off at the end of the 1990s.  Yet, 
considerable amounts of money were  still provided to some of the lingering farms until the middle of 
the current decade.  
 The reform characteristics detailed above meet the criteria set out in paragraphs 1 and 12 of  
Annex 2.  As far as paragraph 1 criteria are concer ned, the public support granted within the reform 
scheme was limited to the renovation of infrastructure,  and by no means to the product price.  With 
respect to paragraph 12 criteria, the reform was la unched in order to comply with environmental 
needs and the public support in question was limited to the extra costs imposed on the farmers in the 
course of implementing the reform. 
 
 Japan    G/AG/N/JPN/124
 
 
43. Question by Australia – Green Box –  General Services  – Noted that, in fiscal year 2003, 
the total expenditure relating to infrastructure was 1,085.9 billion yen (including expenditure on 
extension and infrastructural services for t echnological improvement of agricultural 
production; general services for livestock industr y including extension and infrastructure; 
infrastructural services for agricultural sector and rural areas;  and  infrastructural services for 
market facilities).  Confirmation sought that expenditure on infrastructure is directed to the 
provision or construction of capital works only, and is in conformity with paragraph 2(g) of 
Annex 2, which excludes the subsidized provision of on farm facilities and subsidized inputs or 
operating costs; request for an outline of the infrastructure projects that received funding in 
2004.    G/AG/R/48 
 Page 27 
 
 
   In 2004, the expenditure on infrastructure was allocated to:  (i) the provision and construction 
of distribution, marketing facilities and rural roads;  (ii) the construction of dams and other irrigation 
and drainage utilities for farming;  and (iii) the constr uction of sewage plants in rural areas, and so on.  
This expenditure was directed at the construction of  capital works, but not at the subsidized provision 
of on-farm facilities, nor at subsidized inputs and operating costs. Such expenditure therefore 
complies with paragraph 2(g) of Annex 2. 
  
44.  Question by Australia – Green Box: Environmental programmes  - Noted that payments 
are made for the conversion from rice pro duction and maintaining paddy fields in 
environmentally good conditions through growing any plants other than rice.  Sought 
information on the underlying factors for targ eting this environmental programme to rice 
producers only; whether Japan would consider allowi ng producers of all crops to be eligible for 
payments in order to better achieve the enviro nmental objectives and to increase the level of 
conservation.  
 The objective of the programme in question is  to avoid adverse effects on the environment 
caused by the conversion from rice production and to maintain paddy fields in environmentally good 
conditions.  Since there is no policy plan to prom ote production conversion scheme other than rice in 
paddy fields, Japan does not find it necessary to extend this type of environm ental programme to any 
other products.  
45. Australia understands that farmers who choose to produce wheat instead of rice also 
receive, in addition to the conversion payment,  both the market price for wheat and any 
applicable wheat production subsidies.  Since the amount of the payment for conversion from 
rice is linked to the production of wheat, explan ation is sought as to how the programme meets 
the fundamental requirement set out in paragr aph 1 of Annex 2 and specifically paragraph 
1(b).  
 Payment for conversion form rice production is  not conditioned on whether other products are 
produced or what types of products are produced.  This programme is not designed to stimulate 
production of any specific crops and therefore it meets the fundamental requirements set out in 
paragraph 1 of Annex 2.  For re ference, Japan notified the supports for wheat production in question 
as AMS, which is separate from the payments  granted under the conversion programme. 
 
Follow-up comments
:  Australia maintained that under th e rice conversion programme, if farmers 
choose to produce wheat instead of rice, they w ould receive both the conversion payment and the 
market price of wheat, plus the applicable wheat subs idies.  In Australia's view, this would effectively 
mean providing market price support. Japan noted th at the two types of payments i.e. under the 
conversion programme and other support (for example for wheat production) were separate. 
 
46. Question by Australia – Blue Box : Noted that under the "Rice Farming Income 
Stabilization Program" (RFISP), direct payments are made to rice producers through a production-limiting programme. Information sought on this programme, including eligibility 
criteria, determination of the amount of paymen ts.  Whether any analysis has been carried out 
to determine the structural adjustment effect s of this programme, including increases in the 
production of other crops.  
 Under the RFISP, farmers who conduct the e ffective production-limiting programme for rice 
receive a direct payment as compensation for the lo ss of income whose level is determined by the 
production amount and price of the products every y ear.  This programme is, through its appropriate 
operation, expected to contribute to the effective implementation of the rice conversion scheme.  The 
programme is not designed to enhance structural adjustment and therefore Japan has not conducted 
any analysis to assess its stru ctural adjustment effects. G/AG/R/48 
Page 28  
 
   
47. Question by Australia - Product-specific AMS
 – Noted that, in ST/DS:7, fruit and 
vegetables are included as "basic agricultural pro ducts" that are exempt from the calculation of 
AMS due to de minimis  spending. Australia understands that de minimis spending should be 
notified and calculated on the basis of suppo rt provided to the producers of each 'basic 
agricultural product' rather than broad product groups.  Clarification sought as to whether 
payments are made to producers of specific fr uit/vegetables or to producers of fruit or 
vegetables generally. Identification of the indi vidual fruit and vegetables that received payments 
and their corresponding gross values of production (GVP).  
 These payments are made to producers of speci fic fruit or vegetables.  Eligible products and 
their corresponding gross values of production in 20 03 are as follows:  Oranges (Unshu-mikan): 137.2 
billion yen;  Apples: 129.5;  Tomatoes: 178.2;  Cucumbers: 143.3;  Welsh onions and leeks: 133.2;  Spinach: 101.7;  Radish: 100.9;  Eggplants: 90.6;  Cabbage: 84.5;  Onions: 72.2;  Carrots: 55.6; etc. 
 Follow-up comments
:  Australia stated that if support was provided to specific products, the product-
specific AMSs should also be notified specifically for individual products.  Japan noted that it was 
applying the same methodology as it followed at the time of establishment of the AMS commitments specified in its Schedule.  
48. Question by Australia - Product-Specific AMS
 - Noted that starch is included in the 
calculation of the Current Total AMS in ST/DS:7, and that, in ST/DS:5, starch is broken down 
into potatoes and sweet potatoes. Given that st arch is a carbohydrate compound that can be 
found in many products including wheat, rice, be ans, potatoes and vegetables, Australia sought 
more information on the nature of these payments .  Explanation sought on producer eligibility 
criteria for starch price support payments and, in  particular, clarification if payments are made 
available to producers of potatoes and sweet pota toes only, or producers of any starch product 
more broadly.  Whether Japan would consider itemizing each "basic agricultural product" 
eligible for starch payments in ST/DS:7.  
 In Japan, starch is only produced from potato es and sweet potatoes. The payments therefore 
are limited to the producers of potatoes and sweet potatoes only.  Japan has been notifying domestic 
support figures under the same classification as set out in its Schedule, so there is no need to change 
this classification and divide starch payments into  payments for "potatoes" and "sweet potatoes". 
 
49. Question by Thailand - Clarification of the kind of support measures used to manage 
and operate the public stockholding for food security programme.  
 Stockholding is conducted for rice, wheat, barley, soybeans and feed grain.  For rice, wheat 
and barley, the government manages stockholding by funding the operational costs.  For soybeans and 
feed grain, the government provides support to part  of the operational costs for stockpiling to the 
private sector under trust management contracts. Th e government also conducts part of the stockpiling 
for feed grain.  
50. Question by Thailand - Clarification of support measures related to stabilization 
programmes and whether the objectives of such measures have been accomplished.  
 See explanation already provided in response to question 46 above. 
  G/AG/R/48 
 Page 29 
 
 
   Korea   G/AG/N/KOR/37  
 
51. Question by Australia – Green Box : Noted that support for "Infrastructure Services" 
has increased by 86.8 billion won in 2001 compared  to 2000.  Request for more information on 
these services, including reasons for the increase in expenditure; confirmation that expenditure 
was solely directed at the provision or constructi on of capital works and that it complies with 
paragraph 2(g) of Annex 2 which excludes the subsidized provision of on farm facilities and subsidized inputs or operating costs.  
 Infrastructure Services comprise a land re-arrangement programme, a farm road enlargement 
and pavements works programme, a water supply f acilities repair programme, a tideland reclamation 
and irrigation programme, a water development pr ogramme, etc. All of these programmes aim to 
provide agricultural infrastructure services. In 2001, the support for "Infrastructure Services" 
increased due to the increase in the expenditur es on the drainage improvement programme, water 
supply facilities repair programme and tele-cont rol of irrigated water supply programme. In 
accordance with paragraph 2(g) of  Annex 2, infrastructure services are designed as support for the 
construction of capital works such as irrigation, wa ter supply, drainage plan, etc., and do not include 
subsidized inputs or operating costs.  52. Question by Australia – Green Box
 – Information sought on financial assistance to debt-
ridden farmers; specifically, criteria under which a pplicants are eligible to receive payments 
and nature of these payments.  
 In the 1990s, Korean agriculture experienced serious financial difficulties due to several 
reasons.  Firstly, as agricultural products' prices significantly dropped, Korean farmers' incomes 
decreased in parallel. Secondly, farmers' debts became larger and they had to borrow more money 
from banks to sustain their livelihood. Financial as sistance to debt-ridden farms was largely provided 
by extending farmers' debt maturity  and reducing interest rates.  Th is programme had been specified 
in Korea's Schedule as a financial readjustment measure exempt from the reduction commitments.  
53. Question by Australia – Green Box
: Noted that the Korean Ministry of Agriculture and 
Forestry website describes the Agriculture and Fishery Disaster Control Act as authorizing 
payments to residents of any cities and counties adjacent to those directly affected by natural 
disasters.  Confirmation sought regarding the a ccuracy of this statement; compliance with the 
criteria set out in paragraph 8 of Annex 2.  
 The Korean Ministry of Agriculture and Forest ry website states that only those farmers whose 
crops are damaged, to an extent that meets the minimum level of natural disaster required by the 
government, are eligible for government support.  The objective of this programme is to help farmers 
restore their agricultural facilities, farmlands, crops , and livestock damaged by natural disasters such 
as drought, typhoon, flood, and to partly finance the costs incurred.  This programme is available only 
for the farm households that experience crop lo sses of over 30 per cent of the expected harvest 
volume.  It is implemented through the provision of an emergency loan, extension of debt maturity 
and reduction of interest rate.  Payments under this  programme are less than the total cost to cover 
such losses and do not require or specify the type or quantity of future produc tion.  Therefore, this 
programme is in full compliance with paragraph 8 of Annex 2. 
 
54. Question by Australia – Green Box  - Information sought on the nature and eligibility 
criteria for direct payments under environment-friendly farming programmes.  
 Environmental conservation is increasingly im portant as water pollution and soil degradation 
are becoming more serious.  Korea has thus paid k een attention to environmen t-friendly agriculture.   G/AG/R/48 
Page 30  
 
   The Korean Government grants direct paym ents for environment-friendly farming, and 
operates the programme only in the areas where orga nic farming, chemical-free, or low-chemical 
farming methods are put into practice.  The progr amme targets the farmers and farmer groups that 
comply with government-defined criteria for e nvironment-friendly farming. Governors of local 
government are in charge of this programme. Farm ers who want to engage in environment-friendly 
farming should apply to the government authorit y concerned.  The government provides direct 
payments to the applicants who comply with th e requirements of environment-friendly farming and 
are qualified by a Certificate Authority.  The comp ensation paid to each farmer or farmer group is 
determined on the basis of the average amount of  the farm holders' income losses incurred in the 
course of implementing environment-friendly farming practices.  55. Question by Australia – Green Box
 - Information sought on the operation and eligibility 
criteria for the support programmes to improve farmers' living conditions and the buffer stock 
management fund; confirmation that these progr ammes are consistent with the fundamental 
criteria set out in Annex 2, paragraph 1.  
 The support programme to improve farmers' liv ing conditions are aimed to encourage agro-
tourism so as to increase off-farm income, as well as to promote house renovation.  This programme 
does not have the effect of supporting domestic pric es, nor does it increase production, and therefore 
meets the criteria set out in paragraph 1 of Annex 2.   
 
 The buffer stock management fund is designed to purchase fresh agricultural products such as 
fruit and vegetables in harvest seasons and release them into the market during the lean period.  This 
fund is for fruit and vegetables that are price- inelastic and whose supplies are volatile and 
unpredictable due to their high dependence on natu ral conditions.  However, the fund is neither 
intended to support the prices of the products concer ned nor to encourage their production.  Purchases 
are made at market prices, not at pre-determin ed administered prices. The purchased agricultural 
products are sold by means of a wholesale tender system after a certain period of storage.  Therefore, 
the programme does not have the effect of providing  price support and meets the criteria of paragraph 
1 of Annex 2.  
56. Question by Australia - Explanation sought on  the calculation of deficiency payments 
for beef in ST/DS:6; confirmation that the calc ulation method is in accordance with Annex 3, 
paragraph 10.  
 Deficiency Direct Payment is not a programme d esigned to buy cows but to enable farmers to 
have solid cow industry foundations.  This progra mme had been in place until 1998.  Currently, a 
"Calf Breeding Stabilization Scheme" is being operated as a deficiency payment.  It was notified as a 
non-exempt direct payment in accordance with Annex 3, paragraph 10. This programme is a direct 
deficiency payment that intended to partly support the price gap as the price of calves falls.  This 
payment is basically calculated based on the budgeta ry outlays incurred, in accordance with Annex 3, 
paragraph 10.  57. Question by Australia - Product-specific AMS, 2001
 - Reasons for introducing product-
specific AMS for milk in 2001. Information so ught on the operation of the Milk Purchase 
Subsidy, in particular, how payments are made to producers.  
 As regards the Milk Purchase Subsidy, surplu s in milk production has emerged as a serious 
issue since 2001.  The Korean Dairy Board (KDB) h as tried to control the milk supply to resolve the 
problem.  The KDB plays a role of buying milk from dairy farmers and selling it to milk companies in 
order to control milk supply. The government s upports the operation costs incurred by the KDB, but 
this does not mean that dairy farmers have been directly supported by the government. 
  G/AG/R/48 
 Page 31 
 
 
  58. Question by Australia – Green Box, 2002 : Noted the increase in expenditure for food 
security programmes from 114.6 billion won in 2001 to 184.5 billion won in 2002.  Explanation sought.  
 The notified expenditures on public stockholding  for food security purpose relate to operating 
storage, processing and transporting the rice and barl ey purchased for such purposes.  The increase in 
amount of expenditure is mainly due to the rise in maintenance costs together with a temporary 
increase of public stocks. 
 
59. Question by Australia – Green Box, 2002
: Noted that payments for relief from natural 
disasters have increased from 181.7 billion Wo n in 2001 to 1,066.9 billion Won in 2002.  
Information sought on the nature of these programmes; eligibility criteria required for 
payments.  
 The amount of payments under this programme increased significantly in 2002 mainly due to 
the increase in compensatory paym ents for losses caused by serious consecutive natural disasters, 
including several typhoons. The objective of this programme is to help farmers restore their 
agricultural facilities, farmlands, crops, and livest ock damaged by natural disasters such as drought, 
typhoon, flood, and to provide a part of the costs in curred.  As mentioned in replying to the previous 
questions, this programme is available only for the farm households who experience crop losses of 
over 30 per cent of the expected harvest volume.  It is implemented through the provision of an 
emergency loan, the extension of debt maturity, and a reduction of interest rate.  Payments under this 
programme are less than the total cost to cover su ch losses and do not require or specify the type or 
quantity of future production.  60. Question by Australia - Non-product-specific AMS, 2002
: Noted that input subsidies 
have increased by 37.62 billion won.  Information sought on beneficiaries; elibility criteria; 
whether Korea has considered using alternative forms of support which may meet the rules of the Green Box.  
 Under the compensation programme for the loss from fertilizer supply scheme, the 
government paid 97.11 billion won in 2001 and 134.73 billion won in 2002, for an increase of 37.62 
billion won.  Such an increase resulte d from the increase in the unit cost of fertilizers.  Since 2006, the 
programme on chemical fertilizers no longer exis ts. The organic fertilizer programme has been 
introduced to promote environment-friendly farming.  
 
61. Question by Australia – Green Box, 2003:
 - Further detail on the criteria for payments 
under Structural adjustment assistance provide d through resource retirement; confirmation 
that in the case of land retirement, the programme is consistent with the requirements outlined in Annex 2, paragraph 10.  
 For the purpose of structural  adjustment assistance, the government implements a set-aside 
programme for paddy and a support programme for the reduction of dairy production and the 
retirement of farmers from the dairy industry.  In order to reduce the volume of rice production, the 
set-aside programme has been implemented only fo r the land which was used for rice farming as of 
2002 but would be left idle for a minimum of three years.  In order to reduce milk production, a 
support programme for the reduction of dairy produc tion and the retirement of farmers from the dairy 
industry has been implemented.  If dairy farmers wa nt to close their business, they should report it to 
the government and they will receive compensation.  In order to receive the compensation, farmers 
should permanently dispose of milk cows.  These programmes meet the criter ia in paragraph 10(b) 
under Annex 2.  
 G/AG/R/48 
Page 32  
 
  62. Question by Australia - Non-product-specific AMS, 2004
 - Further details on the nature 
of the loan programme for agricultural marketing,  specifically the major beneficiaries of this 
programme.  
 The loan programme for agricultural marketing is designed to support producer groups such 
as the Agricultural Cooperative Association to rev italize marketing activities by providing a part of 
the finances necessary for su ch activities.  The beneficiaries of this programme are not farmers but 
producer groups such as the National Agricultur al Cooperative Federation, the Agricultural 
Cooperative Association, etc. 
 
63. Question by Canada - Noted that a crop in surance programme was introduced in 2001. 
It appears from the website of Korea's  Minist ry of Agriculture and Forestry that "measures for 
natural disasters" are separate from "crop insurance". Since no  Table DS:2 notification for 
crop insurance is available, Canada presumes it  does not meet the criteria of Annex 2.  
Indication of where the support under crop insurance is reported in G/AG/N/KOR/37.  
 The Crop Insurance scheme for relief from natural disasters was introduced in 2001.  
Currently six fruit vulnerable to natural disasters (a pples, pears, peaches, grapes, sweet persimmons 
and mandarins) are eligible for this scheme, whic h has been operated by the private sector.  The 
government provides supports on the insurance prem ium (about 50 per cent).  According to Korea's 
calculations, the amount of compensation from the gove rnment is only about 7 per cent of the actual 
production loss.  Korea intends to submit Table DS:2 in due course.  The amount of support for this 
programme in 2001 was 2.3 billion won and is in cluded in the "payments for relief from natural 
disasters" category, together with "compensatory pa yments for losses caused by natural disasters" in 
the ST/DS:1.  Korea believes that this natural relie f programme does not have any price or production 
effect and is in compliance with Annex 2.  
 
64. Question by Canada – Green Box : Noted that, with respect to "Compensatory payments 
for losses caused by natural disasters", Korea indicated in G/AG/R/20 that farmers were 
eligible when production losses exceeded 30 per cen t of the value of production. Clarification 
sought as to whether farmers are not eligible when production losses are 30 per cent or less of 
the value of production.  
 Regarding "Compensatory payments for losses caused by natural disasters", farmers are 
compensated for the damage to agricultural facilit ies, farmlands, crops and livestock, caused by 
natural disasters (drought, typhoon, floods, etc.).  Farmers are eligible when production losses exceed 
30 per cent of the value of production. 
 
65. Question by New Zealand - Green Box, 2004 :  Noted the six-fold increase in expenditure 
under (d) "decoupled income support" between 1 999 and 2004.  Comments  requested on such 
expenditure, including its forecasted level of expenditure over the next five years.  
 Over the years from 1999 to 2004, certain dec oupled income support programmes, such as 
financial assistance which was not related to  production to debt-ridden farmers, increased 
substantially due to the financial difficulties experi enced by rural communities.  This programme was 
specified in Korea's Schedule as a financial readjustment measure exempt from reduction 
commitments.  Some other decoupled income s upport programmes were intr oduced and implemented, 
such as a pension support programme and a school tuition support programme for children of farmers 
and fishermen.  All these programmes were designe d and implemented as decoupled income support.  
Korea has been continuing intensive agricultura l reform. The policy direction of the Korean 
government is to gradually reduce distortive pr ogrammes and instead increase production neutral 
programmes, such as decoupled direct payment programmes.   G/AG/R/48 
 Page 33 
 
 
   
(v) Table DS:2  
 Armenia    G/AG/N/ARM/6/Add.1 & ARM/8/Add.1
 
 
66. Question by Canada – Green Box :  Noted that the description of measures under the 
heading "Payments for relief from natural disast ers" does not indicate how these programmes 
meet the criteria of paragraph 8 of Annex 2.  Description of these programmes with reference to 
each and every criterion in paragraph 8, includi ng the need for the pr oduction loss to exceed 
30 per cent to establish eligibility for payments.   
 The delegation of Armenia was not present in meeting.  
  Canada   G/AG/N/CAN/64
 
 67. Question by the United States – Green Box: Whether the margin under the Canadian 
Agricultural Income Stabilization (CAIS) Pr ogram is calculated the same way as under 
previous programmes such as the Canadian Fa rm Income Program (CFIP) and Agricultural 
Income Disaster Assistance (AIDA); if not, explanation sought.  
 As with the CFIP and the AIDA, the margin  under the CAIS is calculated as the difference 
between farm revenues and operating expenses.  Fu rther information about these payments can be 
found in the following Table DS:2 notifications: G/AG/N/CAN/64 (Income Disaster Component of CAIS), G/AG/N/CAN/40 (CFIP) and G/AG/N/CAN/36 (AIDA).    
68. Question by the United States - Whether the Risk Management Funding is a one-year 
programme; whether this funding is referred to as "2003 Transition Funding" In Statistics 
Canada , Catalogue 21-015  
 To help farmers make the transition to the new risk management programmes under the 
Agricultural Policy Framework (APF), the Governme nt of Canada provided $1.2 billion in Risk 
Management Funding in two instalments of $600 million over two years.  The first $600 million 
instalment provided was under Risk Management Fundi ng I and was placed directly into producer Net 
Income Stabilization Accounts (NISA).  The sec ond $600 million instalment was a direct payment to 
all Canadian producers based on a percentage of thei r eligible net sales in a defined and fixed base 
period.  In the Statistics Canada publication, paym ents under the "2003 Transition Funding" refers to 
the second component of the Risk Management Fund ing where money was paid directly to producers 
based on a percentage of their eligible net sales .  The first component of the Risk Management 
Funding is reflected in the data for NISA. 
 
 Canada   G/AG/N/CAN/65  
 
69. Question by the United States – Noted that the Transitional Industry Support Payment 
had two components, one for ruminant pro ducers and one for all producers.  Whether 
ruminant producers were eligible for th e second component as well as the first.  
 Ruminant producers were eligible for both co mponents of the Transitional Industry Support 
Payment. 
 
70. Question by the United States – Noted that the Farm Income Payment Programme had 
two components, one for ruminant producers an d one for all producers.  Whether ruminant 
producers were eligible for the second component as well as the first.  G/AG/R/48 
Page 34  
 
   Ruminant producers were eligible for bot h components of the Farm Income Payment 
Program.  
71. Question by the United States - Whether the programmes have provisions to ensure that 
producers are not compensated for more than the value of their production, or whether this is 
not considered an issue.  
 The payments to ruminant producers and the payments to all producers are direct payments 
under paragraph 6;  as such the amount of the pa yment is not linked to the producer's volume of 
production, or prices, or factors of production.  Furt her details on the structure of the payments can be 
found on pages 2 – 5 of G/AG/N/CAN/65
. 
 
72. Question by the United States – Noted that the description of the two programmes 
indicates the same base period was used for both Transitional Industry Support Payment and 
Farm Income Payment Programme.  Whether the same producers who received payments under the Transitional Industry Support Payment we re eligible for the Farm Income Payment 
Programme, even if they were no longer producing (i.e. had retired or otherwise gone out of 
business).  
 The eligibility criteria for both programmes was identical.  As a result, the same producers 
who received payments under Transitional Industry S upport Payment were eligible for Farm Income 
Payment Program and received payments even if th ey were no longer producing (i.e. had retired or 
otherwise gone out of business). 
 
73. Question by the United States - These programmes also use the same base period as the 
Risk Management Funding that covered the FY2003/04 period.  Whether the Transitional Industry Support Payment and Farm Inco me Payment Programme are considered 
continuations of the Risk Management Funding programme.  
 To help farmers make the transition to the new risk management programmes under the 
Agricultural Policy Framework (APF), the Governme nt of Canada provided $1.2 billion in Risk 
Management Funding in two instalments of $600 million over two years:  Risk Management Funding 
I and Risk Management Funding II.  This fundi ng was announced in 2002.  While the Transitional 
Industry Support Payment and Farm Income Payment Program payments were based on a percentage 
of a producer's eligible net sales using the identical  defined and fixed base period, i.e., the identical 
criteria as Risk Management Funding II, these two programmes addressed the extraordinary 
circumstances facing producers due to BSE.  These programmes are not a continuation of the Risk Management Funding II.  (vi) Tables ES:1 to ES:3  
 Japan   G/AG/N/JPN/126
 
 74. Question by Thailand - Detailed criteria of th e food aid that Japan directly donated to 
recipient countries.  
 Countries which officially request bilateral food aid to Japan, countries which have a need for 
aid and also adequate systems for the acceptance of aid and countries which face food crises requiring 
emergency assistance (FAO, October 2006). 
  G/AG/R/48 
 Page 35 
 
 
   Korea   G/AG/N/KOR/36  
 
75. Question by Thailand - More details of ex port subsidy measures of each product 
notified.  
 The Korean Government has b een supporting part of export expenses of vegetables, fruit and 
flowers for packing, sorting and transporting.  This kind of support falls into the category of cost of 
marketing exports of agricultural products and their internal transport assistance as stipulated in sub-
paragraphs (d) and (e) of Article 9.1 of the Ag reement on Agriculture.  Such measures are exempt 
from reduction commitment for developing country Me mbers, in accordance with Article 9.4 of the 
Agreement on Agriculture. G/AG/R/48 
Page 36  
 
  Annex 2   
 
Notifications subject to review in respect of which no questions have been raised 
 
in advance of the issuance of the convening airgram  
 
(i) administration of tariff and other quota commitments (Table MA:1):   
- Costa Rica  G/AG/N/CRI/17   
 
(ii) imports under tariff and other quota commitments (Table MA:2):   
- Costa Rica  G/AG/N/CRI/16  
- Croatia  G/AG/N/HRV/5  - El Salvador G/AG/N/SLV/27  
 
(iii) special safeguard (Tables MA:3 to MA:5):   
- Costa Rica G/AG/N/CRI/18  
- South Africa G/AG/N/ZAF/62  
- Chinese Taipei  G/AG/N/TPKM/40, 41, 42, 45 and 47  
- Thailand G/AG/N/THA/60 
 
(iv) domestic support commitments (Table DS:1):  
- Armenia G/AG/N/ARM/9/Corr.1  
- Canada G/AG/N/CAN/66  - Costa Rica G/AG/N/CRI/19  - Honduras G/AG/N/HND/21  
- Nigeria G/AG/N/NGA/3  
- Singapore G/AG/N/SGP/16  - South Africa G/AG/N/ZAF/58  - Switzerland  G/AG/N/CHE/38  
 
(v) new or modified domestic support measures exempt from reduction (Table DS:2): 
- Armenia G/AG/N/ARM/8/Corr.1 
- Australia G/AG/N/AUS/64 
- Costa Rica G/AG/N/CRI/20 
- Honduras G/AG/N/HND/22  
 
(vi) in the context of export subsidy commitments (Tables ES:1 to ES:3): 
- Argentina G/AG/N/ARG/25  
- Armenia G/AG/N/ARM/10  - China  G/AG/N/CHN/10  - Costa Rica G/AG/N/CRI/15  
- Croatia G/AG/N/HRV/4  
- Hong Kong, China G/AG/N/HKG/21  - Nigeria G/AG/N/NGA/4  - Singapore G/AG/N/SGP/17  - South Africa G/AG/N/ZAF/59  
- Chinese Taipei G/AG/N/TPKM/44  
- Thailand G/AG/N/THA/61  
__________