. /.   WORLD TRADE  
ORGANIZATION  G/C/W/634 
18 May 2010 
 
 (10-2771) 
Council for Trade in Goods Original:   English 
  
 
QUESTIONS ON THE FEED -IN TARIFF PROGRAM  
OF THE PROVINCE OF ONTARIO, CANADA 
 
Japan's request under Other Business, at the meeting of 
 
the Council for Trade in Goods on 21 May 2010  
 
  The following communication, dated 17 May 201 0, has been received from the delegation of 
Japan.  
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  Japan has concerns regarding the Feed-In Tari ff (FIT) program of the Province of Ontario, 
Canada.  
 The Province of Ontario established its FIT pr ogram in May 2009 through the enactment of 
the Green Energy Act, 2009.   FIT programs are policy mechanisms designe d to encourage the adoption of renewable 
energy sources.  Although these programs are struct ured differently from country to country, many 
national and local governments are moving toward adop ting some form of this policy, viewing it as a 
promising way to achieve green grow th while combating climate change. 
  With regard to Ontario’s FIT program, we ar e seriously concerned about its requirement for 
the use of domestic content in order to be eligible for the program ( i.e., its "local content 
requirement").  The following is our unde rstanding with regard to this program. 
 
• Schedule B, Section 7, of the Green Energy Act, 2009, adds Section 25.35(3) to the 
Electricity Act, 1998, providing that: "Where the Minister has issued a direction under subsection (1), the Minister shall issue, and the OPA [Ontario Power Authority] shall follow 
in preparing its feed-in tariff program, directi ons that set out the goals relating to domestic 
content to be achieved during the peri od to be covered by the program". 
 
• On September 24, 2009, Deputy Premier George Smit herman issued a directive stating:  "It is 
also important that the feed-in tariff program provide an opportunity for Ontario manufactures 
to participate in the economic benefits that w ill flow from the program.  Therefore, I direct 
the OPA to require that each wind power and solar PV project and solar microFIT project contain a defined percentage of domestic cont ent. […] Domestic content provisions will be 
enforced through the FIT Contract. Develope rs who do not achieve the domestic content 
requirements should be subject to signifi cant commercial consequences under the FIT 
contract". 
 G/C/W/634 
Page 2  
 
   In this regard, we have the following ques tions related to the disciplines in the General 
Agreement on Tariffs and Trade (GATT 1994) an d the Agreement on Trade-Related Investment 
Measures (TRIMs).  1. How is the local content requirement in Ontario’ s FIT program consistent with Article III of 
GATT 1994, and Article 2 and the Annex of TRIMs?1  More specifically: 
(a) How is the local content requirement of th e Ontario’s FIT program consistent with 
the obligation under Article III 4 of GA TT 1994 to accord "treatment [to imported 
products] no less favourable than that accorded to like products of national origin in 
respect of all laws, regulations and requirem ents affecting their internal sale, offering 
for sale, purchase, transportation, distribution or use"? 
(b) How is the local content requirement of th e Ontario’s FIT program consistent with 
the obligations under Article III 5 of GATT 1994 not to "establish or maintain any 
internal quantitative regulation relating to the mixture, processing or use of products 
in specified amounts or proportions which requires, directly or indirectly, that any 
specified amount or proportion of any produc t which is the subject of the regulation 
must be supplied from domestic sources" and not to "otherwise apply internal quantitative regulations in a manner contrary to the principles set forth in paragraph 1"? 
(c) How is the local content requirement of th e Ontario’s FIT program consistent with 
the obligation under Article 2.1 of TRIMs not to "apply any TRIM that is inconsistent 
with the provisions of Article III or Article XI of GATT 1994", as further illustrated 
by paragraph 1(a) of the Annex to TRIMs? 
 We appreciate the objective of FIT programs to realize sustainable and environmentally 
friendly economic growth, but we also believe that any FIT program should be designed and 
implemented in a manner that is consistent with the WTO Agreements.  We are seriously concerned 
that even one FIT program which contains a local content requirement may trigger the introduction of 
other FIT programs which contain local content requi rements, and may result in the proliferation of 
local content requirements in the future.   We would appreciate Canada’s responses to our questions.  
 
  
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1 These provisions are illustrative, not exhaustive.  No te that Japan also registered its concerns with 
respect to the FIT program of the Pr ovince of Ontario, Canada at the regular meeting of Committee on Subsidies 
and Countervailing Measures on 27 April 2010 (G/SCM/136 of 22 April 2010).