Scm Agreement Subsidies

Members in transition to a market economy Members in transition to a market economy will have seven years to end prohibited subsidies. However, such subsidies must have been notified within two years of the entry into force of the WTO Agreement (i.e. before 31 December 1996) in order to qualify for special treatment. Members with economies in transition also enjoy preferential treatment with respect to countervailable subsidies. The first part provides that the subsidy agreement applies only to subsidies granted specifically to an enterprise, sector or group of enterprises or industries and defines both the concept of subsidy and the notion of specificity. In Parts II and III, all specific subsidies are classified into one of two categories: prohibited and questionable (1) and certain rules and procedures are established for each category. Part V sets out the physical and procedural requirements that must be met before a Member can apply a countervailing measure against subsided imports. Parts VI and VII define the institutional structure and modalities for reporting/monitoring the implementation of the SCM Convention. Part VIII contains specific and differential treatment rules for different categories of developing countries. Part IX contains transitional rules for industrialized countries and former members of the centrally planned economy. Parts X and XI contain provisions on dispute settlement and final provisions. (b) subsidies which are subject to the use of domestic products in relation to imported products, alone or as one of the other conditions. The Agreement on Subsidies and Countervailing Measures (SUBSIDIES AGREEMENT) addresses two distinct but closely related topics: multilateral disciplines governing the granting of subsidies and the application of countervailing measures to compensate for injury caused by subsidy imports.

The establishment of a multilateral redress system allowing members to challenge subsidies that have adverse effects is a major step forward from the pre-WTO regime. However, the difficulty will persist in most cases for a complaining member to demonstrate the commercial effects of the subsidy, a factual analysis that panels may, in some cases, find difficult (2). Specificity. However, assuming that a measure constitutes a subsidy within the meaning of the Subsidies Agreement, it is not subject to the Subsidies Agreement unless it has been specifically granted to an undertaking, industry or group of undertakings or undertakings. . . .