RESTRICTED  WORLD TRADE  
ORGANIZATION  G/SCM/M/70 
5 February 2010 
 (10-0677) 
Committee on Subsidies  
and Countervailing Measures Original:   English 
 
 
 
MINUTES OF THE SPECIAL MEETING 
HELD ON 20 OCTOBER 2009 
 
Chairman:  Mr. Raimondas Alisauskas (Lithuania)  
 
 1. The Committee on Subsidies and Countervailing Measures ("the Committee") held a special 
meeting on 20 October 2009. 
2. The Committee adopted the agenda: 
A.
 REVIEW OF 2009  NEW AND FULL SUBSIDY NOTIFICATIONS ........................................................2  
1. Cuba ........................................................................................................................... ................2  
2. Macao, China ................................................................................................................... .........2  
3. Suriname....................................................................................................................... .............2  
4. Trinidad and Tobago............................................................................................................ ....2 
B. REVIEW OF 2007  NEW AND FULL SUBSIDY NOTIFICAT IONS NOT REVIEWED BEFORE ..................3  
1. Honduras ....................................................................................................................... ............3  
2. Jamaica ........................................................................................................................ ..............3  
3. Korea.......................................................................................................................... ................3  
4. Macao, China ................................................................................................................... .........3  
5. Trinidad and Tobago............................................................................................................ ....3 
C. CONTINUATION OF REVIEW OF 2007  NEW AND FULL SUBSIDY NOTIFICATIONS ..........................3  
1. Argentina ...................................................................................................................... .............3  
2. Japan.......................................................................................................................... ................4  
3. Paraguay....................................................................................................................... .............4  
D. SOUTH AFRICA 'S MOTOR VEHICLE DEVELOPMENT SCHEME –QUESTIONS POSED BY 
MEXICO TO SOUTH AFRICA UNDER ARTICLE  25.8  OF THE SCM AGREEMENT ...............................5  
 G/SCM/M/70 
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  A. 
REVIEW OF 2009  NEW AND FULL SUBSIDY NOTIFICATIONS  
3. The Chairman  stated that the first agenda item provi ded for the review of 2009 new and full 
subsidy notifications.  These notifica tions had been circulated in the G/SCM/N/186/... series.  Before 
proceeding to the review of these notifications, the Ch airman drew Members' attention to the fact that 
only 25 Members had submitted their 2009 new and full notifications, in cluding those that had made a 
nil notification.  The number of Members that had made their 2007 new and fu ll subsidy notifications, 
which were due more than two years ago, was 42.  This meant that there remained a very large 
number of Members which did not comply with their obligation under Article 25 of the SCM Agreement to submit a notification of their subsidy programmes.   
4. This review of subsidy notifi cations took place pursuant to procedures that had been adopted 
by the Committee in 2005 and that could be fo und in document G/SCM/117.  These procedures 
provided that the Committee would review at each special meeting notifications that had been circulated to Members in all three WTO working lan guages not later than 17 weeks before the date of 
the meeting.  In accordance with this provision th e Committee would, at this meeting, review 2009 
new and full subsidy notifi cations submitted by Cuba;  Macao, China;  Suriname;  and Trinidad and 
Tobago. 
5. The procedures adopted by the Committee for th e review of subsidy notifications provided 
that written questions had to be submitted to the no tifying Member and to the Secretariat not less than 
thirteen weeks before the date of the meeting at which a notification was to be reviewed, and written 
responses had to be submitted not less than four w eeks before the date of that meeting.  Where a 
Member failed to provide written answers within the specified time period, it had to provide full oral 
answers at the meeting itself.   
1. Cuba 
6. The 2009 new and full subsidy notification of Cuba had been circulated in document 
G/SCM/N/186/CUB, dated 22 May 2009.  No questi ons had been received with regard to this 
notification.  No delegation took the floor to co mment or ask questions on Cuba's 2009 new and full 
subsidy notification.   
2. Macao, China 
7. The 2009 new and full subsidy notification of Maca o, China had been circulated in document 
G/SCM/N/186/MAC, dated 5 May 2009.  No questi ons had been received with regard to this 
notification.  No delegation took the floor to comment or ask questions on Macao, China's 2009 new 
and full subsidy notification.   
3. Suriname 
8. The 2009 new and full subsidy notification of  Suriname was contained in document 
G/SCM/N/186/SUR, dated 6 May 2009.  No questions  had been received with regard to this 
notification.  No delegation took the floor to comment or ask questions on Suriname's 2009 new and 
full subsidy notification.   
4. Trinidad and Tobago 
9. The 2009 new and full subsidy notification of Tr inidad and Tobago had been circulated in 
document G/SCM/N/186/TTO of 3 June 2009.  No ques tions had been received with regard to this 
notification.  No delegation took the floor to co mment or ask questions on Trinidad and Tobago's 
2009 new and full subsidy notification.    G/SCM/M/70 
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  B. REVIEW OF 2007  NEW AND FULL SUBSIDY NOTIFICAT IONS NOT REVIEWED BEFORE  
10. The Committee had before it the 2007 new and full subsidy notifications of Honduras;  
Jamaica;  Korea;  Macao, China;  and Trinidad and Tobago.   
1. Honduras 
11. The original 2007 new and full subsidy notification of Honduras had been circulated in 
document G/SCM/N/155/HND dated 14 June 2007 reviewed at the Committee's special meeting held 
on 25 October 2007.  Subsequently, Honduras had s ubmitted a supplement to its 2007 notification, 
circulated in document G/SCM/N/155/HND/Suppl.1 dated 18 December 2008.  No questions had 
been received with regard to this notification.  No delegation took the floor to comment or ask 
questions on Honduras' 2007 new and full subsidy notification.   
2. Jamaica 
12. The 2007 new and full subsidy notification of Jamaica had been circulated in document 
G/SCM/N/155/JAM dated 3 July 2009.  No questi ons had been received with regard to this 
notification.  No delegation took the floor to comment or ask questions on Jamaica's 2007 new and 
full subsidy notification. 
3. Korea 
13. The 2007 new and full subsidy notification of Korea had been circulated in document 
G/SCM/N/155/KOR dated 4 May 2009.  The Committ ee had received a question from the Separate 
Customs Territory of Taiwan, Penghu, Kinmen and Ma tsu regarding the notification of Korea, which 
had been circulated in document G/SCM/Q2/KOR/ 30.  Korea's reply to this question had been 
circulated in document G/SCM/Q2/KOR/31.  No  delegation took the floor to comment or ask 
questions on Korea's 2007 new and full subsidy notification.   
4. Macao, China 
14. The 2007 new and full subsidy notification of Maca o, China had been circulated in document 
G/SCM/N/155/MAC dated 21 March 2007 and reviewed at the Committee's special meeting held on 
25 October 2007.  Macao, China had made an add itional notification, which was circulated in 
document G/SCM/N/155/MAC/Add.1 dated 16 April 2008.   No questions had been received with 
regard to this notification.  No delegation took  the floor to comment or ask questions on Macao, 
China's 2007 new and full subsidy notification.   
5. Trinidad and Tobago 
15. The 2007 new and full subsidy notification of Tr inidad and Tobago had been circulated in 
document G/SCM/N/155/TTO dated 3 June 2009.  No ques tions had been received with regard to this 
notification.  No delegation took the floor to co mment or ask questions on Trinidad and Tobago's 
2007 new and full subsidy notification. 
C. CONTINUATION OF REVIEW OF 2007  NEW AND FULL SUBSIDY NOTIFICATIONS  
1. Argentina 
16. Argentina's 2007 new and full subsidy notifi cation had been circulated in document 
G/SCM/N/155/ARG dated 10 April 2008 and reviewed at the Committee's special meeting held on G/SCM/M/70 
Page 4  
 
  29 October 2008.  The United States had asked ques tions regarding Argentina's notification which 
were circulated in document G/SCM/Q2/ARG/29 dated 22 April 2009.  The Committee had not yet 
received written replies to these questions. 
17. The delegate of Argentina
 stated that his delegation had received recently from the capital 
their replies and was making certain adjustments to them.  Once these adjustments were done, the 
delegation of Argentina would supply the answers to the United States as well as to the Committee. 
18. The delegate of the United States  stated that his delegation was looking forward to 
Argentina's answers.   
19. No other delegation took the floor to comment or ask questions on Argentina's 2007 new and 
full subsidy notification. 
20. The Committee took note  of the statements made.   
2. Japan 
21. The Chairman  stated that Japan's 2007 new and full subsidy notification had been circulated 
in document G/SCM/N/155/JPN dated 3 September 2007 and discussed at the Committee's special 
meeting held on 29 October 2008.  Through document  G/SCM/Q2/JPN/44 dated 8 July 2009, Japan 
had replied to the follow-up questions posed by  the United States, circulated in document 
G/SCM/Q2/JPN/44. 
22. The delegate of the United States  reminded the Committee that this issue had been discussed 
previously at the Committee meeting in May and that , at this point, it was just a matter for Japan and 
the United States to agree to disagree.  Furthe rmore, Article 2.2 of the SCM Agreement was a 
provision that set out conditions for regional specific ity.  In this context, a subsidy programme that 
was limited to certain industries within a certain region would automatically qualify for specificity.  
The delegation of Japan stated that even if a progr amme was limited to a region, there had to be a 
further determination that the programme was limite d to certain enterprises within that region.  The 
delegate of the United States stated that that interp retation read Article 2.2 out of the Agreement.  He 
noted that this issue was being reviewed in WTO dispute settlement and that perhaps Members would 
have further clarification on this over time. 
23. The delegate of Japan  stated that his delegation had responded to the questions from the 
United States at the May meeting of the Committee.  Japan had provided answers then and later on in 
writing.  He expressed agreement with the US' view that  the two parties were in a situation to agree to 
disagree on this matter.  As the delegation of Japan had explained at the May meeting, and 
subsequently in writing, specificity was not automatic ally determined from the fact that the relevant 
subsidy was granted to a region.  In accordance wi th Article 2.2 of the SCM Agreement, one would 
have to check whether the subsidy was also limite d to certain enterprises within that region.  The 
delegate of Japan stated that his delegation was ready to further discuss this issue with the United 
States. 
24. The Committee took note  of the statements made. 
3. Paraguay 
25. The Chairman  stated that Paraguay's 2007 new and full subsidy notification had been 
circulated in document G/SCM/N/155/PRY dated 28  April 2008 and discussed at the Committee's 
special meeting held on 29 October 2008.  Thro ugh document G/SCM/Q2/PRY/8 dated 12 May 2009,  G/SCM/M/70 
 Page 5 
 
 
  Paraguay had replied to the questions posed by the United States which had been circulated in 
document G/SCM/Q2/PRY/7. 
26. The delegate of the United States  stated that his delegation's concern initially was with the 
fact that it was very specifically noted in Law 60/90 that one of the purposes was "export promotion 
and import substitution" which seemed to ra ise potential issues under Article 3 of the 
SCM Agreement.  The delegation of the United St ates had difficulty understanding the answer that 
was provided since it seemed that the initial purpose of the programme was to offset levies on exports 
and that once the levies on exports were removed that the general purpose of export promotion and 
import substitution were no longer re quired.  The delegate of the United States asked whether the 
delegate of Paraguay c ould confirm that understanding or furt her elaborate upon Paraguay's answer.  
Secondly, with respect to the answer to question 2,  the delegate of the United States noted that the 
legislation was currently undergoing review and expressed hope that the eligibility criteria on the 
basis of "export promotion and/or import substitution" would be looke d at in the course of that 
review.  He asked whether the dele gate of Paraguay could confirm th at this was going to be the case. 
27. The delegate of Paraguay  stated that the interpretation of the US delegation was correct with 
regard to the elimination of tax incentives.  With  regard to question 1, Paraguay's Law 60/90, as 
Paraguay had mentioned in its reply, did state th at it was aimed at "promoting exports and import 
substitution", but this was only due to the fact th at it had been drafted in 1990 and the wording 
responded to the legislation drafted in that period.  In fact, the law did not include any mechanism to 
achieve the said goal.  With regard to question 2, the tax regime, there had been two significant 
changes.  The first change had taken place in 1991.   The second and most significant change had been 
effectuated through Law 2421 of 200 4 and its implementing regulations , which had eliminated all tax 
incentives to exports, including incentives for auto parts. 
28. The Committee took note of the statements made. 
D. SOUTH AFRICA 'S MOTOR VEHICLE DEVELOPMENT SCHEME –QUESTIONS POSED BY MEXICO TO 
SOUTH AFRICA UNDER ARTICLE  25.8  OF THE SCM AGREEMENT  
29. The Chairman  stated that at the Committee's regular meeting held on 29 October 2008, the 
delegate of Mexico had raised questions on South Africa's Moto r Vehicle Development Scheme.  
Mexico had subsequently submitted these questi ons in writing, as circulated in document 
G/SCM/Q2/ZAF/10.  At the special meeting held on 7 May 2009, the delegate of South Africa had informed the Committee that her delegation had me t with the Mexican delegation bilaterally to 
discuss this issue and answered the latter's questions .  The delegate of South Africa had also stated 
that her delegation would make its replies to Mexi co available to the Committee in writing.  These 
replies had been received by the Committee the day before the meeting and circulated in document 
G/SCM/Q2/ZAF/11.  No delegation took the floor to make comments on this issue. 
30. The Chairman adjourned the special meeting of the SCM Committee. 
__________