WORLD TRADE  
ORGANIZATION   
G/SCM/Q2/EU/2 
23 January 2012 
 (12-0437) 
Committee on Subsidies 
and Countervailing Measures Original:   English 
 
 
 
SUBSIDIES 
 
Questions Posed By CANADA regarding the New and Full 
Notification of the EUROPEAN UNION1 
 
 
 The following communication, dated 20 January 2 012, is being circulated at the request of the 
Delegation of Canada. 
 
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 Question 1:  Common Agricultural Policy (CAP) – page 9 
 
Could the EU confirm that future CAP refo rm (that is currently  being debated and 
considered) will continue along the track started by the Health Check reform?    Question 2:  European Agricultural Guarantee Fund – page 11  
 
 The notification indicates that 76% of the support provided under the EAGF "had no or at most minimally trade distorting effects".  Could th e EU provide additional de tails on how they arrived 
at this conclusion for 76% of EAGF support?  C ould the EU provide data to substantiate this 
conclusion?  
 
Question 3:  Export Subsidies – page 13  
 The notification indicates either static or declining export refunds (EAGF payments) from 
2008 to 2010 in all sectors, with the exception of  dairy products where a significant increase is 
observed.  Further, from 2008 to 20120 a signifi cant increase in inte rvention measures (EAGF 
budget) in the dairy products sector is observed.  Could the EU provide an explanation for this 
increased support to the dairy products sector?  Does th e EU anticipate that these high levels of export 
refunds and interventions for dairy products will continue in the fu ture?  Also, can the EU provide 
additional details on the type of non-Annex 1 products that obtained export subsidies? 
 
Question 4:  Cereals – page 14 
 
 The notification states that the Commission may decide to modify the ceilings for cereals "if 
the market situation so requires".  Could the EU elaborate on criteria for determining these situations 
and how the ceilings for cereals would be modified?   
                                                      
1 G/SCM/N/220/EEC.   G/SCM/Q2/EU/2 
Page 2  
 
  Question 5:  Sugar – page 16 
 
 Could the EU describe the impact that the su rplus levy and voluntary restructuring scheme 
has had on reducing the amount of excess sugar and sugar production capacity in the EU?  Could the 
EU explain what plans there are going forward?  
 
Question 6:  Fruits and Vegetables – page 19 
 
 Could the EU provide additional background on the Producer Organizations, with regards to 
the number of Producer Organizations and the typ es of fruits and vegetables associated with a 
Producer Organization, their legislative foundatio ns, who can join and the application process? 
 
Question 7:  Milk and dairy products – page 27 
 
 The notification states that the Commission ma y adopt exceptional support measures for milk 
and milk products for the affected market to take account of restrictions on in tra-EU and third-country 
trade which may result from the application of me asures for combating the spread of diseases in 
animals.  Could the EU elaborate on what these meas ures could be?  If such support has been granted, 
could the EU explain the particular circumstance s?  Could the EU confirm whether any partial 
financing would be comparable to th at provided for other livestock?   
 Question 8:  Direct aids – page 31   
 The notification indicates that payments under the Single Payment Scheme (SPS) are 
independent of what and whether a farmer produ ces and therefore calls these payments "decoupled 
income support" (Section IV.C.3.1). T he Single Area Payment Scheme (SAPS) is also called a 
"decoupled support scheme", apparently becau se the scheme does not require production 
(Section IV.C.3.2).  Decoupling of support is also  discussed in Section IV.A.1.  Given that another 
WTO agreement (the Agreement on Agriculture) stipul ates criteria that a payment must meet in order 
to fall under the heading "decoupled income suppor t", could the EU elaborate on how it plans to 
address the potential confusion arising from its labe lling conventions?  Specifically, what does the EU 
mean by "decoupled" and "decoupling"?  
 
Question 9:  Direct aid – page 31 
 
 The notification indicates that support for a number of regimes, including crop areas 
payments, supplementary aid for durum wheat, production aid for seeds, beef special premium, etc. 
were to be abolished by either 1 January 2010, or 1 January 2012 at the latest.  Could the EU confirm 
that this has taken place?  
Question 10:  Environment and countryside – page 48 
 
 Could the EU elaborate on the types of voluntary commitments, beyond those stipulated in 
mandatory EU regulations, whereby farmers would be eligible for agri-environment payments?   
  Could the EU elaborate on the types of voluntary commitments, beyond those stipulated in mandatory EU regulations, whereby farmers would be eligible for animal welfare payments?   
 Question 11:   Community Framework Programmes in the Field of Research – page 52 
 
 Could the European Union indicate how much money – of the total amount specified on page 54 – was allocated to the "aeronautic and sp ace" priority theme (as identified in Decision 
N° 1513/2002/EC of June 27 2002)?  G/SCM/Q2/EU/2 
 Page 3 
 
 
  Question 12:  European Energy Recovery Programme – page 58 
 
 Could the European Union indicate who has benefited from this subsidy and what the 
eligibility criteria are?  Could the EU elaborate on the potential trade effects of this support?   
 Question 13:  European Fisheries Fund (EFF) – page 61  
 The notification states that "The Community has a shortfall in fishery and aquaculture 
products and is a major importer of these products from non-Community countries.  The structural aid has only a very small influence on this situation".  Could the European Union elaborate on the 
potential trade effects from the Eu ropean Fisheries Fund?  The total budget for this fund for 2007 to 
2013 is 4.3 billion EUR.  Was an analysis/st udy completed on the effects on global trade 
(e.g., competitiveness, prices, stocks)?    Could the EU specify how much aid the fish processing sector has received to date?  Was an 
analysis done on the trade effects the aid could ha ve between the EU and third countries' processing 
sectors?  
Question 14:  Common Organisation of the Mark ets in Fishery and Aquaculture Products – 
page 63 
  Regarding the Common Organisation of the Ma rket in Fishery and Aquaculture Products, 
could the European Union explain what are the "o ther specific handicaps'' that are eligible for 
compensatory payments?  Could the EU be more specific regarding aid mechanisms for the policy objectives of stabilizing the market, and guaranteeing reasonable consumer prices?  
 
 
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