CANADA – MEASURES RELATING TO THE FEED-IN TARIFF PROGRAM
Document: Request for the Establishment of a Panel by the European Union
Date: 10 January 2012
Document codes: WT/DS426/5
Complainant: EU
Respondent: Canada
Third parties: U.S., Japan, Australia, China, Taiwan, India, Saudi Arabia, Brazil, South Korea, Mexico, Norway, Turkey, El Salvador
Dispute stage: Appellate Body
Agreements cited: Art. 3.1(b), 3.2, 1.1  Subsidies and Countervailing Measures (SCM)Art. III:4  GATT 1994Art. 2.1  Trade-Related Investment Measures (TRIMs)

CANADA – MEASURES RELATING TO THE FEED-IN TARIFF PROGRAM

Request for the Establishment of a Panel by the European Union

 The following communication, dated 9 Ja nuary 2012, from the delegation of the
European Union to the Chairperson of the Dispute Settlement Body, is circulated pursuant to Article
6.2 of the DSU.

On 11 August 2011, the European Union requested consultations with the Government of
Canada ("Canada") pursuant to Article 4 of the Understanding on Rules and Procedures Governing
the Settlement of Disputes ("DSU"), Article XXII:1 of the General Agreement on Tariffs and Trade
1994 (" GATT 1994"), Article 8 of the Agreement on Trade-Related Investment Measures (the
"TRIMs Agreement"), and Articles 4(1) and 30 of the Agreement on Subsidies and Countervailing
Measures (the " SCM Agreement "), regarding Canada's measur es relating to domestic content
requirements in the feed-in tariff program (the "FIT Program").
1 The request was circulated on
16 August 2011 as document , , ,
Consultations were held on 7 Se ptember 2011 with a view to reaching a mutually satisfactory
solution. Unfortunately, the consultations failed to resolve the dispute.
As a result, the European Union respectfully re quests that a Panel be established to examine
this matter pursuant to Articles 4.7 and 6 of the DSU, Article XXIII of the GATT 1994, Article 8 of
the TRIMs Agreement, and Articles 4.4 and 30 of the SCM Agreement.
The measures that are the subject of this request are those relating to the FIT Program
established by the Canadian province of Ontari o in 2009 providing for guaranteed, above-market,
long-term pricing for the output of renewable energy generation facilities 3 that contain a minimum
percentage of domestic content. These measures include the following:
 the Electricity Act, 1998 ,4 as amended, 5 including in particular Part II (Independent
Electricity System Operator), Part II.1 (Ontario Power Authority) and Part II.2

1 "FIT Program" referred to in this request include s both projects over 10 kilowatts (kW) and projects
of 10 kW or less (microFIT). See http://fit.powerauthority.on.ca/.
2 An addendum to the European Union's request for consultations was circulated on 24 August 2011
since the statement of available evidence with regard to the existence and nature of the subsidies in question was
erroneously omitted from the request for consultations.
3 In particular, facilities utilising windpower with a contract capacity greater than 10 kW, and facilities
utilising solar (PV).
4 S.O. 1998, c. 15, Sched. A.
5 The latest amendment was by: 2010, c. 15, s. 223.

(Management of Electricity Supply, Capacity and Demand) thereof, including in
particular Section 25.35 (Feed-in tariff program);
 an Act to enact the Green Energy Act, 2009 and to build a green economy, to repeal
the Energy Conservation Leadership Act, 2006 and the Energy Efficiency Act and to
amend other statutes (the "Green Energy and Green Economy Act, 2009 "),6 including
in particular Schedule B amending the Electricity Act, 1998;
 an Act to amend the Electricity Act, 1998 and the Ontario Energy Board Act, 1998
and to make consequential amen dments to other Acts (the " Electricity Restructuring
Act, 2004"),7 including in particular Schedule A, Sections 29-32, enacting Part II.1 of
the Electricity Act, 1998, and Sections 33-38, enacting Part II.2 of the Electricity Act,
1998, and Schedule B, Sections 17-18, en acting Sections 78.3-78.4 of the Ontario
Energy Board Act, 1998;
 Ontario Regulation 578/05 made under the Ontario Energy Board Act, 1998 entitled
"Prescribed Contracts Re Sections 78.3 and 78.4 of the Act";
 Independent Electricity System Operator ("IESO") Market Manual, including in
particular Part 5.5 ("Physical Markets Settlement Statements");
 IESO Market Rules, including in partic ular Chapter 7 ("System Operations and
Physical Markets"), Chapter 9 ("Settlements and Billing") and Chapter 11
("Definitions");
 FIT direction dated 24 September 2009, fro m George Smitherman, Deputy Premier
and Minister of Energy and Infrastruct ure, to Colin Andersen, Chief Executive
Officer, Ontario Power Authority ("OPA"), directing OPA to develop a FIT Program
and include a requirement that the applicant submit a plan for meeting the domestic
(i.e., Ontario) content goals in the FIT rules;
 the FIT Rules, Version 1.5.1 (31 October 2011), and the microFIT Rules, Version
1.6.1 (10 August 2011), issued by the OPA;
 the FIT Contract, Version 1.5.1 (31 Oc tober 2011), including General Terms and
Conditions, Exhibits, and Standard Definiti ons, the microFIT Contract, Version 1.6.1
(31 October 2011), including Appendices, a nd the Conditional Offer of microFIT
Contract, Version 1.6.1, issued by the OPA;
 the FIT Application Form (1 December 2009), and online microFIT Application,
issued by the OPA;
 the FIT Price Schedule (3 June 2011), and the microFIT Price Schedule (13 August
2010), issued by the OPA;

6 S.O. 2009, c. 12.
7 S.O. 2004, c. 23.

 the FIT Program Interpretations of th e Domestic Content Requirements (14
December 2009, as updated on 4 October 2010 and 26 April 2011), issued by the
OPA;
8
 individual FIT and microFIT contracts executed by the OPA since the inception of
the FIT Program on 24 September 2009;9 and
 any amendments or extens ions of the foregoing, a ny replacement measures, any
renewal measures, any implementing measures, and any related measures.10
These measures are inconsistent with Canada's obligations under the SCM Agreement , the
GATT 1994 , and the TRIMs Agreement because they constitute a prohibited subsidy, and also
discriminate against imports of equipment and com ponents for renewable energy generation facilities.
In particular, the European Union considers that these measures are inconsistent with the following
provisions:
1. Articles 3.1(b) and 3.2 of the SCM Agreement, because the measures are subsidies within the
meaning of Article 1.1 of the SCM Agreement that are provided contingent upon the use of
domestic over imported goods, namely contingent upon the use of equipment and components
for renewable energy generation facilities pr oduced in Ontario over such equipment and
components imported from other WTO Members, including the European Union;
2. Article III:4 of the GATT 1994 , because the measures accord less favourable treatment to
imported equipment and components for renewable energy generation facilities than accorded
to like products originating in Ontario; and
3. Article 2.1 of the TRIMs Agreement, in conjunction with paragra ph 1(a) of the Agreement's
Illustrative List, because the measures are trade-related investment measures inconsistent with
Article III:4 of the GATT 1994 which require the purchase or use by enterprises of equipment
and components for renewable energy generation facilities of Ontario origin or source.
Accordingly, the European Union respectfully requests the establishment of a Panel with standard
terms of reference in accordance with Article 7.1 of the DSU. The European Union asks that this
request be placed on the agenda for the meeting of the Dispute Settlement Body to be held on
20 January 2012.

Contract, FIT Application Form, microFIT Application, FIT Price Schedule, microFIT Price Schedule, and FIT
Program Interpretations of the Do mestic Content Requirements ( see "http://fit.powerauthority.on.ca/what-feed-
tariff-program/; and http://microfit.powerauthority.on.ca/". The European Union's request, however,
encompasses all versions of these measures ad opted since the inception of the FIT Program on
24 September 2009.