WORLD TRADE  
ORGANIZATION   
WT/DS412/5 
7 June 2011 
 
 (11-2786) 
 Original:   English 
  
 
CANADA - CERTAIN MEASURES AFFECTING THE RENEWABLE  
ENERGY GENERATION SECTOR 
 
Request for the Establishment of a Panel by Japan 
   The following communication, dated 1 June 2011, from the delegation of Japan to the 
Chairperson of the Dispute Settlement Body, is ci rculated pursuant to Article 6.2 of the DSU. 
 
_______________ 
 
  My authorities have instructed me to request the establishment of a Panel on behalf of the 
Government of Japan ("Japan").  
 On 13 September 2010, Japan requested cons ultations with the Government of Canada 
("Canada") pursuant to Article 4 of the Understanding on Rules and Procedures Governing the 
Settlement of Disputes ("DSU"), Article XXII:1 of the General Agreement on Tariffs and Trade 1994  
("GATT 1994"), Article 8 of the Agreement on Trade-Related Investment Measures ("TRIMs 
Agreement "), and  Articles 4.1 and 30 of the Agreement on Subsidies and Countervailing Measures  
("SCM Agreement "), with respect to Canada's measures re lating to domestic content requirements in 
the feed-in tariff program ("the FIT Program").
1 The request was circulated on 16 September 2010 as 
document WT/DS412/1, G/L/926, G/TRIMS/D/27, G/SCM/D84/1.   Consultations were held on 25 October 2010 with a view to reaching a mutually satisfactory 
solution.  Unfortunately, the consulta tions failed to resolve the dispute. 
 
 As a result, Japan respectfully  requests that a Panel be established to examine this matter  
pursuant to Articles 4.7 and 6 of the DSU, Article XXIII of the GATT 1994, Article 8 of the TRIMs 
Agreement , and Articles 4.4 and 30 of the SCM Agreement . 
 
 The measures that are the subject of this request are those taken by the Government of 
Canada or its provinces relating to the FIT Program  established by the Canadian province of Ontario 
in 2009 providing for guaranteed, long-term prici ng for the output of renewable energy generation 
facilities that contain a defined percentage of dom estic content.  These measures include, but are not 
limited to, the following: 
 
 the Electricity Act, 1998 ,
2 as amended,3 including in particular Part II (Independent 
Electricity System Operator), Part II.1 (Ontario Power Authority) and Part II.2 
                                                      
1 The reference to "FIT Program" in this request includes both projects over 10 kilowatts and projects 
of 10 kilowatts or less ( i.e., microFIT).  See http://fit.powerauthority.on.ca/ ; 
http://fit.powerauthority.on. ca/what-feed-tariff-program ; and http://microfit.powerauthority.on.ca/ . 
2 S.O. 1998, c. 15, Sched. A. 
3 The latest amendment was by: 2010, c. 15, s. 223. WT/DS412/5 
Page 2 
 
 
  (Management of Electricity Supply, Capacity and Demand) thereof, including in 
particular Section 25.35 (Feed-in tariff program); 
 an Act to enact the Green Energy Act, 2009  and to build a green economy, to repeal 
the Energy Conservation Leadership Act, 2006  and the Energy Efficiency Act  and to 
amend other statutes (the " Green Energy and Green Economy Act, 2009 "),4 including 
in particular Schedule B amending the Electricity Act, 1998 ; 
 an Act to amend the Electricity Act, 1998  and the Ontario Energy Board Act, 1998  
and to make consequential amen dments to other Acts (the " Electricity Restructuring 
Act, 2004 "),5 including in particular Schedule A, Sections 29-32, enacting Part II.1 of 
the Electricity Act, 1998 , and Sections 33-38, enacting Part II.2 of the Electricity Act, 
1998 , and Schedule B, Sections 17-18, en acting Sections 78.3-78.4 of the Ontario 
Energy Board Act, 1998 ; 
 Ontario Regulation 578/05  made under the Ontario Energy Board Act, 1998  entitled 
"Prescribed Contracts Re Sections 78.3 and 78.4 of the Act"; 
 Independent Electricity System Operator  ("IESO") Market Manual, including in 
particular Part 5.5 ("Physical Markets Settlement Statements"); 
 IESO Market Rules, including in partic ular Chapter 7 ("System Operations and 
Physical Markets"), Chapter 9 ("Settlements and Billing") and Chapter 11 
("Definitions"); 
 FIT direction dated 24 September 2009, fro m George Smitherman, Deputy Premier 
and Minister of Energy and Infrastruct ure, to Colin Andersen, Chief Executive 
Officer, Ontario Power Authority ("OPA"), directing OPA to develop a FIT Program 
and include a requirement that the applicant submit a plan for meeting the domestic (i.e., Ontario) content goals in the FIT rules; 
 individual FIT and microFIT contracts executed by the OPA since the inception of 
the FIT Program on 24 September 2009;
6 
 the FIT Rules, Version 1.4 (8 December 2010), and the microFIT Rules, Version 1.6 
(8 December 2010), issued by the OPA; 
 the FIT Contract, Version 1.4 (8 Dece mber 2010), including General Terms and 
Conditions, Exhibits, and Standard Definitions, the microFIT Contract, Version 1.6 (8 December 2010), including Appendices, and the Conditional Offer of microFIT 
Contract, Version 1.0, issued by the OPA; 
 the FIT Application Form (1 December 2009), and online microFIT Application, 
issued by the OPA; 
                                                      
4 S.O. 2009, c. 12. 
5 S.O. 2004, c. 23. 
6 These contracts include, but are not limited to, those referenced at 
"http://fit.powerauthority.on.ca/Storage/1 0989_FIT_Contracts_Offered_April_8_10_-
_Applicant_Legal_Name_Order3.pdf " and 
http://fit.powerauthority.on.ca/Storage/11216_FIT_Co ntract_Awards_-_Final_List_-_February_24,_2011.pdf .  WT/DS412/5 
 Page 3 
 
 
   the FIT Price Schedule (13 August 2010), and the microFIT Price Schedule 
(13 August 2010), issued by the OPA; 
 the FIT Program Interpretations of th e Domestic Content Requirements (14 
December 2009, as updated on 4 October 2010 and 26 April 2011), issued by the OPA; and 
 any amendments or extens ions of the foregoing, a ny replacement measures, any 
renewal measures, any implementing measures, and any related measures.
7 
 These measures are inconsistent with Canada's obligations under the SCM Agreement , the 
GATT 1994, and the TRIMs Agreement  because they constitute a pr ohibited subsidy, and also 
discriminate against equipment for renewable ener gy generation facilities produ ced outside Ontario.  
In particular, Japan considers that these measures are inconsistent with the following provisions: 
 
1. Articles 3.1(b) and 3.2 of the SCM Agreement , because the measures are subsidies 
within the meaning of Article 1.1 of the SCM Agreement  that are provided contingent 
upon the use of domestic over imported goods, namely contingent upon the use of equipment for renewable energy generati on facilities produced in Ontario over such 
equipment imported from other WTO Members such as Japan;
8 
2. Article III:4 of the GATT 1994, becau se the measures accord less favourable 
treatment to imported equipment for renewable energy generation facilities than accorded to like products originating in Ontario; and 
3. Article 2.1 of the TRIMs Agreement , in conjunction with paragraph 1(a) of the 
Agreement's Illustrative List, because the measures are trade-related investment 
measures inconsistent with Article III :4 of the GATT 1994 which require the 
purchase or use by enterprises of equipment for renewable energy generation facilities of Ontario origin. 
 Further, Japan considers that Canada's measur es nullify or impair benefits accruing to Japan 
directly or indirectly under the cited Agreements  in a manner described in Article XXIII:1 of the 
GATT 1994. 
  Japan requests the establishment of a Panel w ith standard terms of reference in accordance 
with Article 7.1 of the DSU.    
__________  
                                                      
7 Japan notes that, as a matter of convenience, the above list identifies th e most recent versions 
available as of the date of this request of the FIT Rule s, microFIT Rules, FIT Contract, microFIT Contract, FIT 
Application Form, microFIT Application, FIT Price Schedule, microFIT Price Schedule, and FIT Program 
Interpretations of the Domestic Content Requirements.  Japan's request, however, encompasses all versions of 
these measures adopted since the inception of the FIT Program on 24 September 2009. 
8 As subsidies falling under the provisions of Article 3 of the SCM Agreement , the measures are 
deemed to be specific under Article 2.3 of the SCM Agreement .