RESTRICTED  WORLD TRADE  
ORGANIZATION  G/SCM/M/74 
3 February 2011 
 (11-0551) 
Committee on Subsidies 
and Countervailing Measures  
 
 
 
MINUTES OF THE SPECIAL MEETING 
HELD ON 28 OCTOBER 2010  
 
Chairman:  Mr Robert Jui-song Fang (Chinese Taipei)  
 
 
1. The Committee on Subsidies and Countervailing Measures ("the Committee") held a special 
meeting on 28 October 2010. 
2. The Chairman  recalled that the agenda proposed for this meeting was contained in 
WTO/AIR/3640 dated 15 October 2010.  As indicated in that proposed agenda, the purpose of this 
meeting was to continue to discuss new and full subsidy notifications of Members.  The Committee 
adopted  the agenda as proposed: 
A. DISCUSSION OF 2009  NEW AND FULL SUBSIDY NOTIFICATIONS NOT YET REVIEWED .................1  
1. Korea.......................................................................................................................... ................1  
2. Kyrgyz Republic ................................................................................................................ .......2  
3. Macao, China ................................................................................................................... .........2  
4. Namibia........................................................................................................................ ..............2  
5. Paraguay....................................................................................................................... .............3  
6. Qatar .......................................................................................................................... ................3  
7. Turkey......................................................................................................................... ...............3  
B. CONTINUATION OF REVIEW OF 2009  NEW AND FULL SUBSIDY NOTIFICATIONS .......................4  
C. CONTINUATION OF REVIEW OF 2007  NEW AND FULL SUBSIDY NOTIFICATIONS ........................5  
 
A. DISCUSSION OF 2009  NEW AND FULL SUBSIDY NOTIFICATIONS NOT YET REVIEWED  
3. The Chairman  stated that the Committee's review of new and full subsidy notifications 
followed the procedures that were adopted by the Committee in 2005, referred to in G/SCM/117.  
In accordance with these procedures, the notifications that were on the agenda of the special meeting 
were notifications that had been circulated to Me mbers in all three WTO working languages not later 
than 25 June 2010. 
1. Korea 
4. The 2009 new and full subsidy notification of Korea was contained in documents 
G/SCM/N/186/KOR and Corr.1.  Canada, Australia and the United States submitted their questions in 
documents G/SCM/Q2/KOR/32, 33 and 34, respectively.   Korea's replies to these questions had been 
circulated in documents G/SCM/Q2/KOR/35, 36 an d 37, respectively.  Japan had submitted written G/SCM/M/74 
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  questions with respect to Korea's subsidy not ification in document G/SCM/Q2/KOR/38 dated 
25 October 2010. 
5. The delegate of Korea
 stated that since they had receive d the questions only recently, and the 
capital was still looking at them, he would make su re that they come up with the answers shortly. 
6. The delegate of Japan  acknowledged that their questions  came very late and expressed 
appreciation for their circulation.  The questions we re before all Members.  The delegation of Japan 
did not want to get into the details of their qu estions and looked forward to Korea's answers. 
7. The Committee took note  of the statements made. 
2. Kyrgyz Republic 
8. The Chairman noted that 2009 new and full subsidy notif ication of the Kyrgyz Republic was 
contained in document G/SCM/N/186/KGZ.  Questions  posed by the United States regarding this 
notification had been circulated in document G/SC M/Q2/KGZ/1.  No delegation took the floor to 
comment or ask questions on this notification. 
3. Macao, China 
9. The 2009 new and full subsidy notification of M acao, China had been originally submitted in 
document G/SCM/N/186/MAC and reviewed at the Committee's special meeting on 20 October 2009.  
Through document G/SCM/N/186/MAC/Suppl.1, Macao, China had made a supplemental notification.  The United States had asked questions  about the notification of Macao, China which had 
been circulated in document G/SCM/Q2/MAC/4.  M acao, China's replies to these questions had been 
circulated in document G/SCM/Q2/MAC/5. 
10. The delegate of the United States
 stated that his delegation had no further questions except 
that with respect to the programme that provided assi stance to the rebuilding of fishing boats.  With 
respect to this programme, it was still not clear how it related to the sustainability of the fisheries.  
Secondly, regarding the other programmes, the US delegation took Macao, China's point with respect 
to specificity but would disagree as to how the pr ovisions of the SCM Agreement would apply to the 
particular programmes that had been notified. 
11. The delegate of Macao, China  responded that the US comments would be conveyed to her 
government and that her delegation would be ready to reply to any follow -up questions from the 
United States. 
12. The Committee took note  of the statements made. 
4. Namibia 
13. The Chairman  noted that the 2009 new and full subsidy notification of Namibia was 
contained in document G/SCM/N/186/NAM.  The Unite d States had posed questions regarding this 
notification in document G/SCM/Q2/NAM/1.  Na mibia's replies to these questions had been 
circulated in document G/SCM/Q2/NAM/2. 
14. The delegate of Namibia  stated that although the replies had been received after the requested 
deadline for inclusion in the airgram, they had b een sent to the US delegation.  If there were any 
further questions from the United States, the de legation of Namibia would provide replies.  G/SCM/M/74 
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  15. The delegate of the United States  stated that one concern his delegation had with respect to a 
couple of the programmes was the link to exports.  He  pointed to a few places where it stated that the 
programme was not contingent upon exports or di d not promote exports but, at the same time, it 
seemed to be relatively clear that one of the crite ria was whether the programme would lead to an 
increase in exports, or whether assistance under th e programme would stimulate manufacturing and 
increase the number of products exported from Namibia.  The first reading of this indicated that some 
of the benefits under these programmes could be linke d to exports.  The delegate stated that his 
delegation would look at it in more detail a nd would come back with additional comments. 
16. The delegate of Namibia  stated that they would welcome the additional questions from the 
United States and would provide replies after getting their capital's confirmation. 
17. The Committee took note  of the statements made. 
5. Paraguay 
18. The Chairman  noted that the 2009 new and full s ubsidy notification of Paraguay was 
contained in document G/SCM/N/186/PRY.  The Unite d States had posed questions regarding this 
notification in document G/SCM/Q2/PRY/9.  Pa raguay's replies to these questions had been 
circulated in document G/SCM/Q2/PRY/10. 
19. The delegate of Paraguay  expressed her apologies for presenting the answers late.  
In response to the question from the United States, th e delegate of Paraguay st ated that Law No. 90/90 
that established the export promotion regime fo r non-traditionally manufactured products was not 
presently in effect. 
20. The delegate of the United States  stated that his delegation would review the answer from 
Paraguay and that he did not anticipate any further questions. 
21. The Committee took note  of the statements made. 
6. Qatar 
22. The Chairman  noted that the 2009 new and full subsidy notification of Qatar had been 
circulated in document G/SCM/N/186/QAT.  No delegation took the floor to comment or ask 
questions on this notification. 
7. Turkey 
23. The 2009 new and full subsidy notificati on of Turkey was contained in document 
G/SCM/N/186/TUR.  Australia and the United States had posed questions regarding this notification 
in documents G/SCM/Q2/TUR/23 and 24, respectively.   Turkey's replies to the questions from the 
United States had been circulated in document G/SCM/Q2/TUR/25. 
24. The delegate of Turkey  expressed his apologies for not having submitted replies to Australia's 
questions.  This was due to the fact that his governme nt was still working on the reply.  He stated that 
his delegation would submit their reply as soon as possible. 
25. The delegate of Australia  stated that his delegation looked forward to Turkey's response. 
26. The delegate of the United States  made two follow-up comments with respect to Turkey's 
notification.  First, with respect to the free zone  programme, he recalled th at in its questions the 
United States had noted an excerpt from the Trade Policy Report of Turkey which had indicated that G/SCM/M/74 
Page 4  
 
  the free zones were designed to promote joint vent ures and "export oriented enterprises".  There was 
therefore a question as to whether, more on a de facto  than de jure  basis, the benefits provided under 
these programmes were linked to exports.  Secondly,  the delegate of the United States referred to 
another programme listed in the TPR report, i.e.  the technology development zones law, which 
provided incentives to promote the use of high or  advanced technologies.  The United States had 
asked whether this programme had to be notified or  not.  On this point, the delegate noted that 
Turkey's answer stated that this programme was not specific to certain enterprises or industries or 
groups of enterprises or industries.  The delegate acknowledged that this was an issue his delegation 
had also struggled with in respect of some of their programmes that were targeted at advanced 
technologies and high-tech industries.  As to whet her that constituted a specific group or not, the 
delegate stated that this was a difficult question and perhaps one that could not be answered during 
this meeting but he highlighted that for the Comm ittee and invited Turkey to make further comments 
that it might have on this. 
27. The delegate of Turkey
 stated that this was a very technical question and very detailed, and 
that if the United States posed this question in wr iting, the Turkish delegation would convey it to the 
capital and come back with a detailed and comprehe nsive response.  With respect to free zones and 
technology development zones, the delegate pointed out that the question posed by the United States 
was not related to Turkey's subsidy notification submitted in accordance with Article 25 of the 
SCM Agreement.  He stated that subsidies provi ded under these programmes were not specific within 
the meaning of the SCM Agreement, and that th erefore the government of Turkey was under no 
obligation with respect to these subsidies.  Neve rtheless, Turkey had submitted its responses to the 
questions posed by the United States.  In that r esponse, Turkey had provided information concerning 
the application process and eligibility criteria for providing operating licences in free zones and 
technology development zones.  The delegate high lighted that there was no link between obtaining an 
operating license and being an exporter, being an exporter was not a condition to operate in free 
zones.  Further, the delegate of Turkey underlin ed that there was no export contingency or use of 
domestic goods over imported goods criteria to provide operating licence in free zones and 
technology development zones.  He stated that if the Un ited States posed its questions in writing, his 
delegation would provide more detailed replies in writing. 
28. The Committee took note  of the statements made. 
B. CONTINUATION OF REVIEW OF 2009  NEW AND FULL SUBSIDY NOTIFICATIONS  
29. The Chairman  recalled that at the special meeting held on 27 April 2010, the delegate of the 
European Union had stated that his delegation would submit replies to the questions posed by 
Australia (G/SCM/Q2/EEC/60) and Japan (G/S CM/Q2/EEC/61) regarding the 2009 new and full 
subsidy notification of the Europ ean Union.  The European Union' s replies to these questions had 
been circulated in documents G/SCM/Q2/EEC/65 and 66, respectively. 
30. The delegate of Japan  stated that the reply from the Eur opean Union had been sent back to 
Tokyo to see if they would have other questions. 
31. The delegate of Australia  stated that his delegation had received two follow up questions 
which he would read out at the meeting and subsequent ly also send to the European Union.  First, in 
relation to the EU's aid to the coal industry, th e delegate asked whether the European Union would 
continue providing production aid, investment aid, ai d to cover exceptional costs or any other kinds of 
subsidy to its coal industry afte r the current Regulation 1407/2002 expired at the end of 2010.  If the 
aid package was not to be extended, the delegate of Australia also invited the delegation of the 
European Union to explain to the Co mmittee what steps, if any, the Eu ropean Union planed to take to 
assist the coal industry's adjustment to the removal of  the subsidies.  Second, the delegate of Australia 
noted that Regulation 1407/2002 specified that the ai d must not lead to any distortion of competition  G/SCM/M/74 
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  on the electricity market, the market  for combined heat and electricity production, the coal production 
market and the steel market.  The delegate also as ked the delegation of the European Union to explain 
to the Committee how the European Union had ensure d that the aid did not distort international trade 
in coal and related markets. 
32. The delegate of the European Union  stated that her delegation was ready to reply to any 
follow-up questions from Japan, if such questions were submitted in writing.  With respect to 
Australia's questions, the delegate of the European  Union stated that since they had received these 
questions shortly before the Committee meeting, her delegation was not in a position to provide 
replies at the meeting and that they would need to get the views of the officials in Brussels. 
33. The Committee took note  of the statements made. 
C. CONTINUATION OF REVIEW OF 2007  NEW AND FULL SUBSIDY NOTIFICATIONS  
34. The Chairman  recalled that at the special meeting held on 27 April 2010, the delegate of the 
United States had stated that his delegation woul d submit replies to the questions posed by Japan 
(G/SCM/Q2/USA/40) regarding the 2007 new and fu ll subsidy notification of the United States.  
No replies had been submitted to the Committee. 
35. The delegate of the United States  stated that his delegation was still working on answers to 
these questions and did not have them available as of the day of the meeting.  However, the US 
delegation would provide answers to Japan before th e end of the year and, in any case, no later than 
the next Committee meeting.  He also made some  general remarks with respect to the Committee's 
priorities.  The delegate noted that the questions  they received from Japan were perfectly legitimate 
and that the United States had to answer them.  It  appeared that the Committee's procedures were such 
that the lack of answers from the United States me ant that the questions from Japan continued as an 
agenda item year after year.  While that was a ppropriate, in view of importance of everyone's 
notification obligations, the delegate of the United Stat es contrasted that situation with the situation of 
Article 25.8 questions that the US delegation had as ked in the past and whic h had gone unanswered.  
Questions received with respect to a subsidy notifica tion were important but it had to be kept in mind 
that the Member receiving such questions had submitte d a notification.  With respect to at least the 
United States' Article 25.8 questions, they were asked when the relevant Member was seriously 
behind in terms of fulfilling its notification obligati ons, and that such Article 25.8 questions, if gone 
unanswered, were not put on the Committee's agenda y ear after year until they were answered.  This 
was probably something that the Committee had to re view.  The delegate stated that answers to 
questions posed under Article 25.8, especially in the context of Members who had not provided a 
notification in a very long period, were much more important than questions and answers with respect 
to a notification that had already been provided. 
36. The Chairman  stated that the Committee would touc h upon the issue of the questions under 
Article 25.8 at its regular meeting. 
37. The Committee took note  of the statements made. 
38. The Chairman  adjourned the special meeting of the Committee. 
 
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