MEXICO – PROVISIONAL COUNTERVAILING MEASURES ON OLIVE OIL FROM THE EUROPEAN COMMUNITIES
Document: Request for Consultations by the European Communities
Date: 24 August 2004
Document codes: WT/DS314/1; G/L/684; G/SCM/D61/1; G/AG/GEN/66
Complainant: EU
Respondent: Mexico
Dispute stage: Consultation
Agreements cited: Art. 13, 21.1  AgricultureArt. 10, 11.2, 11.3, 11.4, 11.9, 15, 16, 17  Subsidies and Countervailing Measures (SCM)

MEXICO – PROVISIONAL COUNTERVAILING MEASURES
ON OLIVE OIL FROM THE EUROPEAN COMMUNITIES

Request for Consultations by the European Communities

 The following communication, dated 18 Augus t 2004, from the delegation of the European
Communities to the delegation of Mexico and to th e Chairperson of the Dispute Settlement Body, is
circulated in accordance with Article 4.4 of the DSU.

 The European Communities hereby requests cons ultations with Mexico pursuant to Article 4
of the Understanding on Rules and Procedures Gove rning the Settlement of Disputes (the DSU),
Article XXII of the General Ag reement on Tariffs and Trade 199 4 (GATT 1994), Article 30 of the
Agreement on Subsidies and Countervailing Measures ( SCM Agreement ) and Article 19 of the
Agreement on Agriculture , concerning the imposition of provi sional countervailing measures on
imports of olive oil originating in the European Communities by Resolution of 18 May 2004
published in Diario Oficial de la Federación of 10 June 2004.

 The European Communities considers that the initiation of the above-mentioned
countervailing duty investigation and the subse quent imposition of provisional measures are
inconsistent with Mexi co’s obligations under inter alia Articles 10, 11 (in particular paragraphs 2, 3,
4, and 9) 15, 16 and 17 (in particul ar Article 17.1(a) and (b)) of the SCM Agreement, and Article 13
and/or Article 21.1 of the Agreement on Agriculture.

 The inconsistencies include:

– the initiation of an investigation in the absence of sufficient evidence that a domestic industry
is suffering injury as a result of subsidized imports, in violation of Article 11.2 of the
SCM Agreement ;

– the failure by the Mexican authorities to revi ew the accuracy and ade quacy of the evidence
provided in the application to determine whethe r there was sufficient ev idence to initiate an
investigation, in violation of Article 11.3 of the SCM Agreement;

– the failure to establish whether the applicati on was made by or on behalf of the domestic
industry of the like product, in violation of Article 11.4 of the SCM Agreement;

– the imposition of provisional countervailing measu res despite the failure to correctly define
the domestic industry, in violation of Articles 16 and 17.1 of the SCM Agreement;
WT/DS314/1, G/L/684,
G/SCM/D61/1, G/AG/GEN/66

– the failure to reject the application and to terminate promptly the investigation as soon as the
Mexican authorities should have been satisfied th at there was insufficie nt evidence to initiate
and/or proceed with the investigation, in violation of Article 11.9 of the SCM Agreement;

– the imposition of provisional counterva iling measures following the conduct of an
investigation that was not initia ted in accordance with the provisions of Article 11 of the
SCM Agreement, in violation of Article 17.1(a) of the SCM Agreement;

– the imposition of provisional counterva iling measures following the conduct of an
investigation that was not initiated in accordance with the provisions of the SCM Agreement
and the Agreement on Agriculture, in violation of Article 10 of the SCM Agreement;

– the imposition of provisional countervailing meas ures despite the non-existence of material
injury or material retardation, in violation of Articles 15 and 17.1(b) of the SCM Agreement,
notably Article 15.4;

– the imposition of provisional countervailing measu res despite the failure to establish a causal
link between the allegedly subsidized imports and the alleged injury, in violation of
Article 15.5 and 17.1(b) of the SCM Agreement;

– the initiation of a countervailing duty investig ation on imports of an agricultural product
(olive oil) outside the circumstances c ontemplated in Article 13(b)(i) of the Agreement on
Agriculture and/or in violation of Article 21.1 of the Agreement on Agriculture;

– the imposition of provisional countervailing m easures on imports of an agricultural product
(olive oil) outside the circumstances c ontemplated in Article 13(b)(i) of the Agreement on
Agriculture and/or in violation of Article 21.1 of the Agreement on Agriculture;

 The European Communities reserves the right to raise additional claims and legal matters
regarding the above-mentioned measures during the course of the consultations.

 The European Communities looks forward to receiving the reply of the Government of
Mexico to this request to setting a mutually convenient date for consultations.