BRAZIL - MEASURES AFFECTING DESICCATED COCONUT
Document: Request for Consultations by the Philippines Revision
Date: 10 January 1996
Document codes: WT/DS22/1/Rev.1; G/SCM/D1/1/Rev.1; G/L/57/Rev.1; G/AG/W/15/Rev.1
Complainant: U.S.
Respondent: Australia
Dispute stage: Consultation
Agreements cited: Art. 3  Subsidies and Countervailing Measures (SCM)

BRAZIL - MEASURES AFFECTING DESICCATED COCONUT
Request for Consultations by the Philippines
Revision
The following communication, dated 27 November 1995, from the Permanent Mission of the
Philippines to the Permanent Mission of Brazil was notified to the Dispute Settlement Body and is
circulated at the request of the Permanent Mission of the Philippines in accordance with Article 4.4
of the DSU.
In connection with the countervailing duty imposed by Brazil on Philippine's exports of desiccated
coconut, I wish to request formal consultations with Brazil under Article XXIII:1 of GATT 1994.
I understand that Brazil has reservation about our recourse to WTO dispute settlement procedures.
It is the view of the Philippines that provisions of the Tokyo Round Agreement on the Interpretation
and Application of Articles VI, XVI and XXIII of the GATT (Tokyo Round Agreement), are an
elaboration of the fundamental obligations of Article VI of GATT 1947, and that these fundamental
obligations subsist under GATT 1994.
Furthermore, the Philippines wishes to refer Brazil to paragraph 2(a) of the Decision of
8 December 1994 by the Preparatory Committee for the WTO with respect to the Transitional Co-
Existence of the Agreement on the Interpretation and Application of Articles VI, XVI and XXIII of
the General Agreement on Tariffs and Trade and the Marrakesh Agreement Establishing the .1
In the consultations we request, we would like to state our position with respect to the
inconsistency of Brazil's countervailing duty on Philippine's exports of desiccated coconut products
with, inter alia, paragraphs 3 and 6(a) of Article VI of GATT 1994, with the end in view of arriving
at a mutually agreed solution.
Additionally, at the consultations, we wish to reiterate our view that:
1. The Philippines was not given reasonable opportunity, throughout the investigation, to clarify
the factual situation. As previously stated by the Philippine Government, there is no subsidy
granted to desiccated coconut processors;
1See document PC/15-L/7586.

2. In calculating the amount of the subsidy and the countervailing duty, Brazil relied on
"informationavailable" whichexcluded data and informationonthetypeof assistanceprograms
to the coconut producers that was provided by the Philippines;
3. Brazil calculated the amount of the alleged subsidy and countervailing duty by treating the
coconut fruit as substitutable for desiccated coconut when these two products are not like
products. Moreover, Brazil is a producer of coconuts and desiccated coconut, both of which
are available in the domestic market of Brazil, and should therefore not have treated the coconut
fruit as a substitute for desiccated coconut;
4. In investigating the assistance programs to the Philippine coconut industry, Brazil failed to
recognize that these programs, as implemented by a developing country like the Philippines,
should not have been considered as subsidies per se. Moreover, as the Philippines had
previously testified, the source of funds for the assistance programs came from a levy (i.e.,
a tax) on coconut production, and not from any government budget.
5. Brazil has failed to notify to the WTO, without delay, the instruments that imposed the
provisional duty on 28 March 1995 and the definitive duty on 21 August 1995.
In the proposed consultations the Philippines also wishes to state our position that Brazil's
measure is inconsistent with Article 13 of the WTO Agreement on Agriculture.
Finally, notwithstanding this request for consultations under Article XXIII:1, I wish to reserve
our rights under the Tokyo Round Agreement.