WORLD TRADE  
ORGANIZATION  WT/DS365/1 
G/L/823 
G/SCM/D76/1 G/AG/GEN/75 
17 July 2007 
 
 
(07-3026) 
 Original:   English 
 
  
UNITED STATES – DOMESTIC SUPPORT AND EXPORT CREDIT GUARANTEES 
FOR AGRICULTURAL PRODUCTS 
 
Request for Consultations by Brazil
 
  
 The following communication, dated 11 July 2007, from the delegation of Brazil to the delegation of the United States and to the Chairman of the Dispute Settlement Body, is circulated in 
accordance with Article 4.4 of the DSU. 
 
_______________ 
 
  My authorities have instructed me to request  consultations with the Government of the 
United States pursuant to Articles 1 and 4 of the Understanding on Rules and Procedures Governing 
the Settlement of Disputes  ("DSU"), Article XXII of the General Agreement on Tariffs and Trade 
1994  (GATT 1994), Articles 4 and 30 of the Agreement on Subsidies and Countervailing Measures 
(SCM Agreement) , and Article 19 of the Agreement on Agriculture .   
 
2. This request comprises two parts. 
 I. The measures at issue in the first part of Brazil's Request for Consultations are as follows: 
  (a) for the years
1 1999, 2000 and 2001 : all domestic support measures in favour of 
agricultural producers, within the meaning of Article 6.1 of the Agreement on Agriculture  
notified by the United States in the notifications of its domestic support2 (the "Notifications") 
as part of its Aggregate Measurements of Suppor t for those years, as well as the programs, 
legislation, regulations and other instruments by which any support was provided, as set forth in Title 7 of the US Code
3 and Title 7 of the US Code of Federal Regulations ,4 as well as the 
additional non-notified programs and support provided thereunder: 
 
• Production Flexibility Contract payments5 for each of wheat, corn, grain sorghum, 
barley, oats, upland cotton, and rice; Non-insured Crop Disaster Assistance 
                                                      
1 In this request, "year" has the meaning assigned to it in Article 1(i) of the Agreement on Agriculture .  
2 G/AG/N/USA/43 of 5 February 2003 for year 1999 and G/AG/N/USA/51 of 17 March 2004 for years 
2000 and 2001. 
3 Including Chapters 21C, 26, 35, 35A, 36, 38, 50, 55 , 58, 63, 68, 76, 77, 79, 80 , 82, 87, 89, 90, 91, 92, 
97, 99, 100, 101, 105, 106, 107 and 108.  
4 Including Chapters IV, VII, IX, X, XI, XIV, and XV. 
5 Subtitle B, Title I, Federal Agriculture Improvement and Reform Act of 1996 , Public Law 104-127. WT/DS365/1, G/L/823,  
G/SCM/D76/1, G/AG/GEN/75 Page 2 
 
 
  payments;
6 Crop Disaster payments;7 Emergency Feed8 and other feed program 
payments for each of beef and veal, dairy,  hogs and pigs, sheep and lamb, and all 
other livestock; Livestock Indemnity9 payments for each of beef and veal, dairy, hogs 
and pigs, sheep and lamb, and all other livestock; Tree Assistance Program 
payments10 for each of apples, apricots, peaches, pears, and all other trees, bushes and 
vines; programs providing various forms of credit for US agricultural producers;11 
programs exempting US agricultural produ cers from payment of gasoline and diesel 
fuel taxes;12 programs exempting US agricultura l producers from tax based on overall 
farm income13; subsidies related to the operation and maintenance of irrigation works 
by the US Department of the Interior.14   
 
• Any other non-notified domestic support m easure or subsidies, and any other 
legislation, regulations and other instru ments by which  that support or those 
subsidies were provided or granted, that  are not properly exempted from the US 
reduction commitments made pursuant to the terms of Article 6 of the Agreement on 
Agriculture.  
 
 (b) for the years 2002, 2004 and 2005 , during which years the United States made no 
notifications of the domestic support include d in its Total Aggregate Measurements of 
Support: 
 
                                                      
6 Section 109, Agricultural Risk Protection Act of 2000 , Public Law 106-224 ; Federal Crop Insurance 
Reform Act of 1994 . 
7 "Food Security Act of 1985, Disaster Assistance Acts of 1988 and 1989 and subsequently " [sic]; 
Fiscal Year 2000 Appropriations Act , Public Law 106-78, October 22, 1999. 
8 Notification G/AG/N/USA/43 indicates no public law or other references for this program. 
Notification G/AG/N/USA/51 lists several public law references but does not indicate which ones apply specifically to this program. 
9 Notification G/AG/N/USA/43 indicates no public law or other references for this program. 
Notification G/AG/N/USA/51 lists several public law references but does not indicate which ones apply specifically to this program.  
10 Notification G/AG/N/USA/43 refers to descriptions in the "1988 and subsequent disaster assistance 
acts". Notification G/AG/N/USA/51 seems to refer to the Disaster Assistance Act of 1988 , Public Law 100-387, 
and also to "Public Law 105-174, May 1, 1998", whose name appears to be "1998 Supplementary 
Appropriations and Rescissions Act" and in which Title II identifies a "Tree assistance program".  
11 The guaranteed loans program provides lenders (e.g ., banks, Farm Credit System institutions, credit 
unions) with a guarantee of payment should the borrower default on the loan. The guarantee permits lenders to 
offer loans to farmers who would not otherwise be eligible for credit.  See "Expect More Program Assessment 
of the Agriculture Credit Insurance Fund," available at 
http://www.whitehouse.gov/omb/expectmore/detail/10001009.2003.html.  Given the United States' failure to 
notify these measures, Brazil is unable to  identify the precise statutory or regulatory provisions at issue, but 
anticipates that the United States will provide such information during consultations.  
12 Diesel fuel and gasoline used on farms are ex empt from various excise and sales taxes.  See e.g., 
Diesel Fuel Tax Exemption 26 U.S.C. §4041(f) and Gasoline Tax Exemption 27 U.S.C. §6420. 
13 Including deductions from taxable incomes from farming, farmers' marketing and purchasing co-
operatives and export transactions of agricultural commodities.   
14 The OECD defines these subsidies as a proportion (38.7 per cent) of the annual expenditure of the 
Bureau of Reclamation (US Department  of the Interior) estimated to apply to the construction, operation and 
maintenance of irrigation works for agriculture.  Details available in Section III.E.1 of OECD "United States: 
Estimates of Support to Agriculture", available at http://www.oecd.org/dataoecd/11/24/37003207.htm .  Given 
the United States' failure to notify these measures, Brazil is  unable to identify the precise statutory or regulatory 
provisions at issue, but anticipates that the United States will provide such information during consultations.  WT/DS365/1, G/L/823,  
 G/SCM/D76/1, G/AG/GEN/75  Page 3 
 
 
  • all domestic support measures in favour of agricultural producers within the meaning 
of Article 6.1 of the Agreement on Agriculture , and the programs, legislation, 
regulations and instruments by which that support was provided, as set forth in Title 7 
of the US Code
15 and Title 7 of the US Code of Federal Regulations ,16 including the 
measures identified in the Annex I to this request; and 
 
• Any other domestic support measure or s ubsidies, and any other legislation, 
regulations and other instruments by whic h  that support or those subsidies were 
provided or granted, that are not properly exempted from the US reduction commitments made pursuant to the terms of Article 6 of the Agreement on 
Agriculture.
  
 
3. Pursuant to Article 3.2 of the Agreement on Agriculture , the United States committed that it 
would limit its Total Aggregate Measurement of Support  to the annual levels specified in section I of 
Part IV of Schedule XX of the United States: fo r the year 1999 USD 19,899.264 million and for each 
subsequent year USD 19,103.294 million.  Despite  these commitments, the United States' Current 
Total Aggregate Measurement of Support appears to  have exceeded its commitment levels in each of 
the years 1999, 2000, 2001, 2002, 2004 and 2005 in violation of Article 3.2.  4. For the years 1999, 2000, and 2001, the Notifications of the United States purport to show that its domestic support did not exceed its commitm ent levels.  However, in its Notifications, the 
United States failed to include in its Aggregate Measurements of Support certain non-exempt 
domestic support measures that the United States provi ded, within the meaning of Article 6.1 of the 
Agreement on Agriculture as described above .  The United States also failed to properly notify certain 
of the measures identified under (a) above which must be included in the United States' Total 
Aggregate Measurement of Support.  Among other as pects of the Notifications that understated the 
Total Aggregate Measurement of Support, the United States:  
 
• incorrectly claimed that its Production Flex ibility Contract payments conformed to 
the criteria for Decoupled income support (paragraph 6 of Annex 2 of the Agreement 
on Agriculture ); 
 
• incorrectly claimed that payments under its Non-insured Crop Disaster Assistance, 
Crop Disaster Assistance, Emergency Feed, Livestock Indemnity, and Tree 
Assistance programs conformed to the criteria for Payments for relief from natural 
disasters (paragraph 8 of Annex 2 of the Agreement on Agriculture ); 
 
• incorrectly included its crop Market Loss Assistance payments
17 in its non-product-
specific Aggregate Measurement of Support instead of product-specific Aggregate Measurements of Support (paragraph 1 of Annex 3 of the Agreement on Agriculture ).   
 
5. For each of the years 1999, 2000 and 2001,  the domestic support that the United States 
provided, and which constituted its  Current Total Aggregate Measurement of Support, exceeded its 
commitment levels, contrary to Article 3.2 of the Agreement on Agriculture .  
                                                     
 
15 Including Chapters 21C, 26, 35, 35 A, 36, 38, 50, 55, 58, 63, 68, 76, 77, 79, 80, 82, 87, 89, 90, 91, 92, 
97, 99, 100, 101, 105, 106, 107 and 108.  
16 Including Chapters IV, VII, IX, X, XI, XIV, and XV. 
17 Section 802, Subtitle A, Title VIII , Emergency and Disaster Assistance for Producers,  Public Law 
106-78; Agricultural Risk Protection Act of 2000,  Public Law 106-224. The Notifications refer to crop Market 
Loss Assistance payments as "Crop market loss assist ance payments", "market loss payments (MLP)", and 
"market loss payments (MLA)". WT/DS365/1, G/L/823,  
G/SCM/D76/1, G/AG/GEN/75 Page 4 
 
 
   
6. Although the United States has not notified its  domestic support since 2001, for each of the 
years 2002, 2004 and 2005, available public informa tion indicates that the domestic support that the 
United States provided and which constituted its Current Total Aggr egate Measurement of Support 
also exceeded its commitment levels, contrary to Article 3.2 of the Agreement on Agriculture .   
 7. Given the US failure to notify any dom estic support programs after 2001, Brazil has 
endeavored to identify as many domestic suppor t measures as possible for the purposes of this 
consultation request in view of available public s ources.  These are set forth in the Annex I to this 
request and/or are referenced above.  However, in view of the nature  of the affirmative US obligation 
under Article 3.2 of the Agreement on Agriculture not to exceed its commitment levels, coupled with 
the US failure to notify its domestic support programs after 2001, it is sufficient (and, indeed, the most that Brazil can be expected to do) for pur poses of this consultation request, for the years 
subsequent to 2001, to describe the general unive rse of domestic support measures provided for in US 
legislation, regulations and other instruments by  which domestic support or subsidies were provided 
or granted, and that are not properly exempted from the US reduction commitments made pursuant to the terms of Article 6 of the Agreement on Agriculture.   
 II. The measures at issue in the second part of Brazil's Request for Consultations are as follows: 
 
• Export credit guarantee programs under the Agricultural Trade Act  of 1978  and other 
measures such as the General Sales Ma nager 102 ("GSM 102") program and the 
Supplier Credit Guarantee Program ("SCGP"), as well as other statutory and regulatory instruments providing the guaran tees, and guarantees provided under those 
programs or other measures, in respect of  agricultural products for which the United 
States has made export subsidy reduction commit ments in Section II of Part IV of the 
Schedule of the United States ("scheduled products"), and in respect of all other 
agricultural products ("unscheduled products").   
 8. Through these measures, the United Stat es makes available export credit guarantees, 
contingent on the export of US agricultural pro ducts, at premium rates and on other terms more 
favourable than those which are otherw ise available in the market.  These  measures therefore 
constitute export subsidies under the Agreement on Agriculture and the SCM Agreement .  The United 
States provides these export subsidies:  (i) in ex cess of its export subsidy reduction commitments for 
scheduled products; and, (ii) for unscheduled produc ts.  These measures theref ore violate Articles 3.3, 
8, 9.1 and 10.1 of the Agreement on Agriculture .  Additionally, these measures are prohibited export 
subsidies contrary to Article 3.1(a) and 3.2 of the SCM Agreement .   
 
9. In respect of Part II of this request for consultations, Article 4.2 of the SCM Agreement  
requires the inclusion of a statement of available ev idence with regard to the existence and nature of 
the subsidies in question.  The Annex II to this request contains Brazil's statement of available 
evidence. 
 
10. Brazil looks forward to receiving the United St ates' reply to this request and to selecting a 
mutually acceptable date on which consultations may take place.  Brazil also expects that the United 
States will supply information duri ng the consultations regarding all of its domestic support measures 
existing in 1999, 2000, 2001, 200 2, 2004, and 2005, as well as on the measures at issue in the second 
part of this request for consultations. 
  WT/DS365/1, G/L/823,  
 G/SCM/D76/1, G/AG/GEN/75  Page 5 
 
 
  ANNEX I 
 
List of Various US Domestic Support Measures  
 
Measure type Policy authority 
Availability of Recourse Loans for 
High Moisture Feed Grains and Seed Cotton Section 1209, Subtitle B of the Farm Security and Rural Investment 
Act of 2002 (Public Law 107-171) 
Certificate Exchange Gains Section 812, Sub title B, Title VIII of the Agriculture, Rural 
Development, Food and Drug Administration, and Related Agencies 
Appropriations Act, 2000 (Public Law 106-78) & 7 CFR, Part 1401, § 1401.4 
Commodity Loan Forfeit  7 CFR, Part 1405, § 1405 (Equivalent to authorities notified in 
ST DS: 6 in G/AG/N/USA/51) 
Commodity Loan Interest Subsidy 7 CFR, Part 1401, § 1401.4 (Equivalent to authorities notified in 
ST DS:7 in G/AG/N/USA/51) 
Cotton User Marketing Certificates Section 136(a), Title 1 of the Federal Agriculture Improvement and 
Reform Act of 1996 (Public Law 104-127) 
Cottonseed Payments Section 206, Title II of the Consolidated Appropriations Resolution, 
2003 (Public Law 108-7) 
Countercyclical Payments (for covered commodities) Subtitle A, Title I of the Farm Security and Rural Investment Act of 
2002 (Public Law 107-171) 
Countercyclical Payments (for 
peanuts) Subtitle C, Title I of the Farm Security and Rural Investment Act of 
2002 (Public Law 107-171) 
Crop and Revenue Insurance 
Subsidized by the Federal Crop Insurance Corporation Title 7 U.S.C., Chapter 36, § 1516 
Crop Disaster payments Title II, Consolidated  Appropriations Resolution, 2003 (Public Law 
108-7)   
Dairy Indemnities Title 7 U.S.C., Chapter 17, § 450j & § 450k  
Dairy Forward Pricing Pilot Program Title 7 U.S.C., Chapter 26, Subchapter III, § 627 
Direct Payments (for covered 
commodities) Subtitle A, Title I of the Farm Security and Rural Investment Act of 
2002 (Public Law 107-171), as amended 
Direct Payments (for peanuts) Subtitle C, Title I of the Farm Security and Rural Investment Act of 
2002 (Public Law 107-171), as amended 
Emergency Loans for Seed Producers Section 10103, Subtitle B, Title X of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Energy Subsidies  As identified by the OECD at 
http://www.oecd.org/dataoecd/11/24/37003207.htm 
 Diesel Fuel Tax Exemption 26 U.S.C. §4041(f) 
 Gasoline Tax Exemption 26 U.S.C. §6420 
Farm Ownership Loans Subtitle A, Title V of th e Farm Security and Rural Investment Act of 
2002 (Public Law 107-171) 
Farm Storage Facility Loan Program Commodity Credit Corporation Charter Act (6 2 Stat.1070; 15 U.S.C. 
714), as amended WT/DS365/1, G/L/823,  
G/SCM/D76/1, G/AG/GEN/75 Page 6 
 
 
  Measure type Policy authority 
Feed Assistance   
 Emergency Feed Assistance 
Program 7 U.S.C. §1471 Emergency Livestock Feed Assistance Act of 1998 
(reauthorized by the Farm Security and Rural Investment Act of 2002 
(Sec. 10104)) 
 Forage Assistance Program 7 U.S.C. §1471 Emergency Livestock Feed Assistance Act of 1998 
 Livestock Assistance Program Military Constructio n and Appropriations and Emergency Hurricane 
Supplemental Appropriations Act of 2005  
 Disaster Reserve Assistance 
Program Agricultural Act of 1970, as amended, 7 U.S.C. 1427a  
 American Indian Livestock Feed 
Program Section 101, Division B, Military Construction and Appropriations 
and Emergency Hurricane Supplemental Appropriations Act of 2005 
(Public Law 108-324) 
 Pasture Recovery Program and 
Flood Compensation Program Agriculture, Rural Development, Food and Drug Administration, and 
Related Agencies Appropriations Act 
Flexible Marketing Allotments for 
Sugar Section 1403, Subtitle D, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Grazing Payments Grazing Payments identified by the OECD at 
http://www.oecd.org/dataoecd/11/24/37003207.htm 
Hard White Wh eat Incentive 
Payments Program Section 1616, Subtitle F, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Income Tax Concessions Tax Concessions identified by the OECD at 
http://www.oecd.org/dataoecd/11/24/37003207.htm  
Irrigation on Bureau of Reclamation Projects in 17 Western States Equivalent to Authorities Notified in Supporting Table DS:9 in 
G/AG/N/USA/51. 
Livestock Pilot Program Section 132, Subtitle C of the Agricultural Risk Protection Act of 
2000 (Public Law 106-224) 
Loan Deficiency Payments (for loan 
commodities) Subtitle B, Title I of the Farm Security and Rural Investment Act of 
2002 (Public Law 107-171) 
Loan Deficiency Payments (for peanuts) Section 1307, Subtitle C, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Marketing Loan Repayment 
provision  Section 1204, Subtitle B, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Market Loss Assistance payments Section 1617, Sub title F, Title I of the Farm security and Rural 
Investment Act of 2002 (Public Law 107-171) 
National Dairy Market Loss 
Payments (Milk Income Loss 
Contract, i.e., MILC) Section 1502, Subtitle E, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
National Dairy Market Loss 
Payments (the authorized extended 
period of the MILC program, i.e., 
MILCX) Section 1101, Subtitle A, Title 1 of  the Deficit Reduction Act of 2005 
(Public Law 109-171) 
Net Federal Budget Outlays for Grazing Livestock on Federal Land Equivalent to authorities notified in Supporting Table DS:9 in 
G/AG/N/USA/51 
Noninsured Crop Di saster Assistance 
Program  Section 109, Subtitle A, Title I of the Agricultural Risk Protection 
Act of 2000 (Public Law 106-224)  WT/DS365/1, G/L/823,  
 G/SCM/D76/1, G/AG/GEN/75  Page 7 
 
 
  Measure type Policy authority 
Nonrecourse Marketing Assistance 
Loans (for loan commodities) Subtitle B, Title I of the Farm Security and Rural Investment Act of 
2002 (Public Law 107-171) 
Nonrecourse Marketing Assistance 
Loans (for peanuts) Section 1307, Subtitle C, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Payments in lieu of Loan Deficiency 
Payments for Grazed Acreage Section 1206, Subtitle B, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Payment to Processor (Sugar) Section 1401, Subtitle D, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Price support/quota: Milk Price 
Support Program Section 1501, Subtitle E, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Price support/quota: Sugar program Section 1401, Sub title D, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Producer Retention of Erroneously 
Paid Loan Deficiency Payments and 
Marketing Loan Gains Section 1618, Subtitle F, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Production Flexibility Contract 
payments Subtitle B, Title I of the Federal Agriculture Improvement and 
Reform Act of 1996  
Recourse loans available for seed 
cotton  Section 1209(b), Subtitle B, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Sheep and Lamb Adjustment 
Assistance Program Clause 3 of Section 32 of the Agricultural Adjustment Act of August 
24, 1935, (Public Law 74-320), as amended  (See also Lamb Meat Adjustment  Assistance Program FSA Fact 
Sheets, August 14, 2000 and April 2002) 
Special Competitive Provisions for 
Extra Long Staple Cotton Section 1208, Subtitle B, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Special Marketing Loan Provisions for Upland Cotton Section 1207, Subtitle B, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
State Credit Programs Equivalent to authorities notified in Supporting Table DS:9 of 
G/AG/N/USA/51 
Storage Payments Equivalent to authorities notified in Supporting Table DS:7 in 
G/AG/N/USA/51 under Cotton 
Strengthening Markets, Income and 
Supply Agriculture, Rural Development, Food and Drug Administration, and 
Related Agencies Appropriations Act, 2002 H.R. 2330 (Public 
Law No: 107-76)  
Sugar Storage Facility Loan Section 1402, Subtitle D, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Supplemental Loan (Sugar) Section 1401, Subtitle D, Title I of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171) 
Support Under Assistance for 
Livestock Producers(includes 
Livestock Indemnity, Livestock 
Compensation and Livestock Assistance payments) Section 10104, Subtitle B, Title X of the Farm Security and Rural 
Investment Act of 2002 (Public Law 107-171), as amended & Section 203(d) of the Agricultural Assistance Act of 2003 (Public 
Law 108-7), as amended 
Tree Assistance Program Subtitle C, Title X of th e Farm Security and Rural Investment Act of 
2002 (Public Law 107-171) 
 WT/DS365/1, G/L/823,  
G/SCM/D76/1, G/AG/GEN/75 Page 8 
 
 
  ANNEX II 
 
Statement of Available Evidence 
  
 Brazil's request for consultati ons dated 11 July 2007 identifies the subsidy measures that are 
part of this request for consultations.  The evid ence set out below is evidence presently available to 
Brazil regarding the existence and nature of tho se subsidy measures. Brazil reserves the right to 
supplement or alter this list in the future, as required. 
 
 The evidence presently available to Brazil includ es, in addition to the relevant legislation, 
regulations and statutory instruments, the following: 
 
USDA Export Credit Guarantee Programs http://www.fas.usda.gov/excredits/ecgp.asp
 
 Eligible Commodities Under the GSM 102 and SCGP Programs http://www.fas.usda.gov/excredits/gsmcommodities.html
 
 GSM 102 Guarantee Fee Rate Schedule 
http://www.fas.usda.gov/excredits/gsm102fees.html
 
 Monthly Summary of Export Credit Guarantee Program Activity http://www.fas.usda.gov/excredits/Monthly/ecg.html
 
 
Budget of the United States Government.  Office of Management and Budget. 
http://www.whitehouse.gov/omb/budget/fy2007/  
 Agricultural Export Credit Gu arantee Programs Assessment 
http://www.whitehouse.gov/omb/expectmore/detail.10002020.2005.html
 
 
__________