CANADA – EXPORT CREDITS AND LOAN GUARANTEES FOR REGIONAL AIRCRAFT
Document: Recourse by Brazil to Article 4.10 of the Agreement on Subsidies and Countervailing Measures and Article 22.2 of the Understanding on Rules and Procedures Governing the Settlement of Disputes
Date: 24 May 2002
Document codes: WT/DS222/7
Complainant: Brazil
Respondent: Canada
Third parties: Australia, EU, India, U.S.
Dispute stage: Panel
Agreements cited: Art. 1, 3  Subsidies and Countervailing Measures (SCM)

CANADA – EXPORT CREDITS AND LOAN GUARANTEES
FOR REGIONAL AIRCRAFT
Recourse by Brazil to Article 4.10 of the Agreement on Subsidies
and Countervailing Measures and Article 22.2 of the Understanding
on Rules and Procedures Governing the Settlement of Disputes
The following communication, dated 23 May 2002, from the Permanent Mission of Brazil to
the Chairman of the Dispute Settlement Body, is circulated pursuant to Article 4.10 of the
SCM Agreement and Article 22.2 of the DSU.
The Panel in the dispute
found that a number of transactions concerning Canadian exports of regional aircraft were
inconsistent with Article 3.1(a) of the Agreement on Subsidies and Countervailing Measures (the
"SCM Agreement"). The report of that Panel () was adopted by the Dispute Settlement
Body (the "DSB") on 19 February 2002. The co rresponding DSB recommendations established that
Canada had to withdraw the identified prohib ited subsidies "without delay". The DSB also
determined that such withdrawal had to take place within 90 days.
In the DSB meeting held on 8 March 2002, in the agenda item "Canada - Export Credits and
Loan Guarantees for Regional Aircraft, (a) Implementation of the recommendations of the DSB", the
Canadian delegation merely indicated that Canada was "considering its options on how best to
proceed with respect to this matter".
The 90-day period granted by the DSB for the withdrawal of the subsidies expired on
20 May 2002. In the DSB meeting held on 22 May 2002, Canada informed WTO Members that it
had not taken action and would not be taking action with regard to any of the transactions found to be
inconsistent with its obligations under the SCM Agreement.
Brazil therefore concludes that Canada has not followed the recommendation of the DSB
within the time-period specified by the panel, as required by Article 4.10 of the SCM Agreement.
Accordingly, pursuant to Article 22.2(a) of the Understanding on Rules and Procedures
Governing the Settlement of Disputes (the "DSU") and Article 4.10 of the SCM Agreement, Brazil
hereby requests that the DSB, in its special meeting of 3 June 2002, grant Brazil authorization to take
appropriate countermeasures in the amount of US$ 3.36 billion.
Brazil intends to implement this authorization to take appropriate countermeasures in the
form of some or all of the following:

(1) suspension of the application of the obligation under paragraph 6(a) of Article VI of
GATT 1994 to determine that the effect of subsidization under EDC Canada Account
and EDC Corporate Account programmes is to cause or threaten material injury to an
established domestic industry, or is to retard materially the establishment of a
domestic industry;
(2) suspension of the application of obligations under the Agreement on Import
Licensing Procedures relative to licensing requirements on imports from Canada; and
(3) suspension of tariff concessions and related obligations under the GATT 1994
concerning a list of products to be drawn from the list attached to this request.

HS Code Description
010210 Pure bred breeding animals
020622 Livers
030541 Pacific salmon (Oncorhynchus nerka, Oncorhynchus gorbuscha, Oncorhynchus keta,
Oncorhynchus tschawytscha, Oncorhynchus kisutch, Oncorhynchus masou and
Oncorhynchus rhodurus), Atlantic salmon (Salmo salar) and Danube salmon (Hucho
hucho)
030551 Cod (Gadus morhua, Gadus ogac, Gadus macrocephalus)
030559 Shark fins
040110 Of a fat content, by weight, not exceeding 1 percent
040410 Whey and modified whey, whether or not concentrated or containing added sugar or
other sweetening matter:
040700 Birds' eggs, in shell, fresh, preserved or cooked
051110 Bovine semen
051199 Other:
070110 Seed
071021 Leguminous vegetables, shelled or unshelled: Peas (Pisum sativum):
071310 Dried leguminous vegetables, shelled, whether or not skinned or split: Peas (Pisum
sativum):
071320 Chickpeas (garbanzos):
071333 Kidney beans, including white pea beans (Phaseolus vulgaris):
071340 Lentils:
100190 Other than durum wheat
100830 Canary seed
100890 Other cereals (including wild rice)
110710 Malt, not roasted
120750 Mustard seeds
121110 Licorice roots
130110 Lac
130219 Other:
130239 Other
151411 Crude oil
151419 Other
151590 Other:
151620 Vegetable fats and oils and their fractions:
160411 Salmon:
170219 Other
170220 Maple sugar and maple syrup:
170390 Other:
170410 Cane molasses:
170490 Other:
180631 Other, in blocks, slabs or bars: Filled
180690 Other:
190120 Mixes and doughs for the preparation of bakers' wares of heading 1905:
190531 Sweet biscuits
190532 Waffles and wafers
190540 Rusks, toasted bread and similar toasted products
190590 Other:
200410 Potatoes:

HS Code Description
200490 Other vegetables and mixtures of vegetables:
200520 Potatoes
200799 Other:
200811 Peanuts (ground-nuts):
200819 Nuts, peanuts (ground-nuts) and other seeds, whether or not mixed together (con.):
Other, including mixtures:
210210 Active yeasts
210310 Soy sauce
210330 Mustard flour and meal and prepared mustard:
210690 Other:
220210 Waters, including mineral waters and aerated waters, containing added sugar or other
sweetening matter or flavoured
220300 Beer made from malt
220830 Whiskies:
230910 Dog or cat food, put up for retail sale
230990 Other:
250300 Sulfur of all kinds, other than sublimed sulfur, precipitated sulfur and colloidal sulfur
250510 Silica sands and quartz sands:
250700 Kaolin and other kaolinic clays, whether or not calcined
250810 Bentonite
250840 Other clays
251010 Natural calcium phosphates, natural alumi num calcium phosphates and phosphatic chalk:
Unground
251110 Natural barium sulfate (barytes):
251990 Other:
252390 Other hydraulic cements
252400 Asbestos
252910 Feldspar
252930 Mineral substances not elsewhere specified or included:
253090 Other:
260300 Copper ores and concentrates
261690 Other
261790 Other
270112 Bituminous coal
270119 Other coal
270300 Peat (including peat litter), whether or not agglomerated
271129 Other
271290 Other:
280120 Iodine
280300 Carbon (carbon blacks and other forms of carbon not elsewhere specified or included)
280429 Other
280469 Other:
280511 Sodium
280512 Calcium
280519 Other:
281119 Other:
281121 Carbon dioxide
281122 Silicon dioxide:
281520 Potassium hydroxide (Caustic potash)

HS Code Description
281700 Zinc oxide; zinc peroxide
281810 Artificial corundum, whether or not chemically defined:
281820 Aluminum oxide, other than artificial corundum
282200 Cobalt oxides and hydroxides; commercial cobalt oxides
282540 Nickel oxides and hydroxides
282612 Of aluminum
282630 Sodium hexafluoroaluminate (Synthetic cryolite)
282735 Of nickel
282751 Bromides of sodium or of potassium
282760 Iodides and iodide oxides:
282911 Of sodium
283220 Other sulfites
283324 Of nickel
283327 Of barium
283329 Other:
283429 Other:
283640 Potassium carbonates:
283650 Calcium carbonate
284019 Other
284020 Other borates
284290 Other
284329 Other
284440 Radioactive elements and isotopes and com-pounds other than those of subheadings
2844.10, 2844.20, and 2844.30; alloys, dispersions (including cermets), ceramic products
and mixtures containing these elements, isotopes or compounds; radioactive residues
285100 Other inorganic compounds (including distilled or conductivity water and water of
similar purity); liquid air (whether or not rare gases have been removed); compressed air;
amalgams, other than amalgams of precious metals
290512 Propan-1-ol (Propyl alcohol) an d propan-2-ol (Isopropyl alcohol)
292310 Choline and its salts
300220 Vaccines for human medicine
300410 Containing penicillin G salts
300450 Other medicaments containing vitamins or other products of heading 2936:
300450 Other medicaments containing vitamins or other products of heading 2936:
300490 Other:
310420 Potassium chloride
321519 Other
370239 Other
370790 Other:
390110 Polyethylene having a specific gravity of less than 0.94
400231 Isobutene-isoprene (butyl) rubber (IIR)
470200 Chemical wood pulp, dissolving grades
470321 Coniferous
470421 Coniferous
480100 Newsprint, in rolls or sheets
481021 Newsprint, in rolls or sheets
810820 Unwrought titanium; powders:
810830 Waste and scrap
841121 Turbopropellers: Of a power not exceeding 1,100 kW:

HS Code Description
841122 Turbopropellers:Of a power exceeding 1,100 kW:
841191 Parts: Of turbojets or turbopropellers:
841950 Heat exchange units:
846599 Other:
847710 Injection-molding machines:
848071 Injection or compression types:
848079 Other types:
848350 Flywheels and pulleys, including pulley blocks:
850440 Static converters:
851730 Telephonic or telegraphic switching apparatus: Telephonic switching apparatus
(including private branch exchange and key system switching apparatus):
851750 Other apparatus, for carrier-current line systems or for digital line systems:
851790 Parts:
852610 Radar apparatus
852691 Radio navigational aid apparatus
852990 Parts suitable for use solely or principally with the apparatus of headings 8525 to 8528
(con.): Other:
854210 Cards incorporating an electronic integrated circuit ("smart" cards)
854470 Optical fibre cables
870839 Other:
870899 Other:
880220 Airplanes and other aircraft, of an unladen weight not exceeding 2,000 kg
880230 Airplanes and other aircraft, of an unla den weight exceeding 2,000 kg but not exceeding
15,000 kg
880240 Airplanes and other aircraft, of an unladen weight exceeding 15,000 kg
900991 Parts and accessories: Automatic document feeders
900992 Parts and accessories: Paper feeders
900993 Parts and accessories: Sorters
900999 Parts and accessories: Other:
901580 Other instruments and appliances: