Agreement Establishing the World Trade Organization
(Continued)
Agreement on Agriculture
PART IV
Article 6: Domestic Support Commitments
1. The domestic support reduction commitments of each Member contained
in Part IV of its Schedule shall apply to all of its domestic support measures
in favour of agricultural producers with the exception of domestic measures
which are not subject to reduction in terms of the criteria set out in
this Article and in Annex 2 to this Agreement. The commitments are expressed
in terms of Total Aggregate Measurement of Support and "Annual and
Final Bound Commitment Levels".
2. In accordance with the Mid-Term Review Agreement that government
measures of assistance, whether direct or indirect, to encourage agricultural
and rural development are an integral part of the development programmes
of developing countries, investment subsidies which are generally available
to agriculture in developing country Members and agricultural input subsidies
generally available to low-income or resource-poor producers in developing
country Members shall be exempt from domestic support reduction commitments
that would otherwise be applicable to such measures, as shall domestic
support to producers in developing country Members to encourage diversification
from growing illicit narcotic crops. Domestic support meeting the criteria
of this paragraph shall not be required to be included in a Member's calculation
of its Current Total AMS.
3. A Member shall be considered to be in compliance with its domestic
support reduction commitments in any year in which its domestic support
in favour of agricultural producers expressed in terms of Current Total
AMS does not exceed the corresponding annual or final bound commitment
level specified in Part IV of the Member's Schedule.
4. (a) A Member shall not be required to include in the calculation
of its Current Total AMS and shall not be required to reduce:
(i) product-specific domestic support which would otherwise be required
to be included in a Member's calculation of its Current AMS where such
support does not exceed 5 per cent of that Member's total value of production
of a basic agricultural product during the relevant year; and
(ii) non-product-specific domestic support which would otherwise be
required to be included in a Member's calculation of its Current AMS where
such support does not exceed 5 per cent of the value of that Member's total
agricultural production.
(b) For developing country Members, the de minimis percentage
under this paragraph shall be 10 per cent.
5. (a) Direct payments under production-limiting programmes shall not
be subject to the commitment to reduce domestic support if:
(i) such payments are based on fixed area and yields; or
(ii) such payments are made on 85 per cent or less of the base level
of production; or
(iii) livestock payments are made on a fixed number of head.
(b) The exemption from the reduction commitment for direct payments
meeting the above criteria shall be reflected by the exclusion of the value
of those direct payments in a Member's calculation of its Current Total
AMS.
Article 7: General Disciplines on Domestic Support
1. Each Member shall ensure that any domestic support measures in favour
of agricultural producers which are not subject to reduction commitments
because they qualify under the criteria set out in Annex 2 to this Agreement
are maintained in conformity therewith.
2. (a) Any domestic support measure in favour of agricultural producers,
including any modification to such measure, and any measure that is subsequently
introduced that cannot be shown to satisfy the criteria in Annex 2 to this
Agreement or to be exempt from reduction by reason of any other provision
of this Agreement shall be included in the Member's calculation of its
Current Total AMS.
(b) Where no Total AMS commitment exists in Part IV of a Member's Schedule,
the Member shall not provide support to agricultural producers in excess
of the relevant de minimis level set out in paragraph 4 of Article
6.
PART V
Article 8: Export Competition Commitments
Each Member undertakes not to provide export subsidies otherwise than
in conformity with this Agreement and with the commitments as specified
in that Member's Schedule.
Article 9: Export Subsidy Commitments
1. The following export subsidies are subject to reduction commitments
under this Agreement:
(a) the provision by governments or their agencies of direct subsidies,
including payments-in-kind, to a firm, to an industry, to producers of
an agricultural product, to a cooperative or other association of such
producers, or to a marketing board, contingent on export performance;
(b) the sale or disposal for export by governments or their agencies
of non-commercial stocks of agricultural products at a price lower than
the comparable price charged for the like product to buyers in the domestic
market;
(c) payments on the export of an agricultural product that are financed
by virtue of governmental action, whether or not a charge on the public
account is involved, including payments that are financed from the proceeds
of a levy imposed on the agricultural product concerned or on an agricultural
product from which the exported product is derived;
(d) the provision of subsidies to reduce the costs of marketing exports
of agricultural products (other than widely available export promotion
and advisory services) including handling, upgrading and other processing
costs, and the costs of international transport and freight;
(e) internal transport and freight charges on export shipments, provided
or mandated by governments, on terms more favourable than for domestic
shipments;
(f) subsidies on agricultural products contingent on their incorporation
in exported products.
2. (a) Except as provided in subparagraph (b), the export subsidy commitment
levels for each year of the implementation period, as specified in a Member's
Schedule, represent with respect to the export subsidies listed in paragraph
1 of this Article:
(i) in the case of budgetary outlay reduction commitments, the maximum
level of expenditure for such subsidies that may be allocated or incurred
in that year in respect of the agricultural product, or group of products,
concerned; and
(ii) in the case of export quantity reduction commitments, the maximum
quantity of an agricultural product, or group of products, in respect of
which such export subsidies may be granted in that year.
(b) In any of the second through fifth years of the implementation period,
a Member may provide export subsidies listed in paragraph 1 above in a
given year in excess of the corresponding annual commitment levels in respect
of the products or groups of products specified in Part IV of the Member's
Schedule, provided that:
(i) the cumulative amounts of budgetary outlays for such subsidies,
from the beginning of the implementation period through the year in question,
does not exceed the cumulative amounts that would have resulted from full
compliance with the relevant annual outlay commitment levels specified
in the Member's Schedule by more than 3 per cent of the base period level
of such budgetary outlays;
(ii) the cumulative quantities exported with the benefit of such export
subsidies, from the beginning of the implementation period through the
year in question, does not exceed the cumulative quantities that would
have resulted from full compliance with the relevant annual quantity commitment
levels specified in the Member's Schedule by more than 1.75 per cent of
the base period quantities;
(iii) the total cumulative amounts of budgetary outlays for such export
subsidies and the quantities benefiting from such export subsidies over
the entire implementation period are no greater than the totals that would
have resulted from full compliance with the relevant annual commitment
levels specified in the Member's Schedule; and
(iv) the Member's budgetary outlays for export subsidies and the quantities
benefiting from such subsidies, at the conclusion of the implementation
period, are no greater than 64 per cent and 79 per cent of the 1986-1990
base period levels, respectively. For developing country Members these
percentages shall be 76 and 86 per cent, respectively.
3. Commitments relating to limitations on the extension of the scope
of export subsidization are as specified in Schedules.
4. During the implementation period, developing country Members shall
not be required to undertake commitments in respect of the export subsidies
listed in subparagraphs (d) and (e) of paragraph 1 above, provided that
these are not applied in a manner that would circumvent reduction commitments.
Article 10: Prevention of Circumvention of Export Subsidy Commitments
1. Export subsidies not listed in paragraph 1 of Article 9 shall not
be applied in a manner which results in, or which threatens to lead to,
circumvention of export subsidy commitments; nor shall non-commercial transactions
be used to circumvent such commitments.
2. Members undertake to work toward the development of internationally
agreed disciplines to govern the provision of export credits, export credit
guarantees or insurance programmes and, after agreement on such disciplines,
to provide export credits, export credit guarantees or insurance programmes
only in conformity therewith.
3. Any Member which claims that any quantity exported in excess of a
reduction commitment level is not subsidized must establish that no export
subsidy, whether listed in Article 9 or not, has been granted in respect
of the quantity of exports in question.
4. Members donors of international food aid shall ensure:
(a) that the provision of international food aid is not tied directly
or indirectly to commercial exports of agricultural products to recipient
countries;
(b) that international food aid transactions, including bilateral food
aid which is monetized, shall be carried out in accordance with the FAO
"Principles of Surplus Disposal and Consultative Obligations",
including, where appropriate, the system of Usual Marketing Requirements
(UMRs); and
(c) that such aid shall be provided to the extent possible in fully
grant form or on terms no less concessional than those provided for in
Article IV of the Food Aid Convention 1986.
Article 11: Incorporated Products
In no case may the per-unit subsidy paid on an incorporated agricultural
primary product exceed the per-unit export subsidy that would be payable
on exports of the primary product as such.
PART VI
Article 12: Disciplines on Export Prohibitions and Restrictions
1. Where any Member institutes any new export prohibition or restriction
on foodstuffs in accordance with paragraph 2(a) of Article XI of GATT 1994,
the Member shall observe the following provisions:
(a) the Member instituting the export prohibition or restriction shall
give due consideration to the effects of such prohibition or restriction
on importing Members' food security;
(b) before any Member institutes an export prohibition or restriction,
it shall give notice in writing, as far in advance as practicable, to the
Committee on Agriculture comprising such information as the nature and
the duration of such measure, and shall consult, upon request, with any
other Member having a substantial interest as an importer with respect
to any matter related to the measure in question. The Member instituting
such export prohibition or restriction shall provide, upon request, such
a Member with necessary information.
2. The provisions of this Article shall not apply to any developing
country Member, unless the measure is taken by a developing country Member
which is a net-food exporter of the specific foodstuff concerned.
PART VII
Article 13: Due Restraint
During the implementation period, notwithstanding the provisions of
GATT 1994 and the Agreement on Subsidies and Countervailing Measures (referred
to in this Article as the "Subsidies Agreement"):
(a) domestic support measures that conform fully to the provisions of
Annex 2 to this Agreement shall be:
(i) non-actionable subsidies for purposes of countervailing duties 4;
(ii) exempt from actions based on Article XVI of GATT 1994 and Part
III of the Subsidies Agreement; and
(iii) exempt from actions based on non-violation nullification or impairment
of the benefits of tariff concessions accruing to another Member under
Article II of GATT 1994, in the sense of paragraph 1(b) of Article XXIII
of GATT 1994;
(b) domestic support measures that conform fully to the provisions of
Article 6 of this Agreement including direct payments that conform to the
requirements of paragraph 5 thereof, as reflected in each Member's Schedule,
as well as domestic support within de minimis levels and in conformity
with paragraph 2 of Article 6, shall be:
(i) exempt from the imposition of countervailing duties unless a determination
of injury or threat thereof is made in accordance with Article VI of GATT
1994 and Part V of the Subsidies Agreement, and due restraint shall be
shown in initiating any countervailing duty investigations;
(ii) exempt from actions based on paragraph 1 of Article XVI of GATT
1994 or Articles 5 and 6 of the Subsidies Agreement, provided that such
measures do not grant support to a specific commodity in excess of that
decided during the 1992 marketing year; and
(iii) exempt from actions based on non-violation nullification or impairment
of the benefits of tariff concessions accruing to another Member under
Article II of GATT 1994, in the sense of paragraph 1(b) of Article XXIII
of GATT 1994, provided that such measures do not grant support to a specific
commodity in excess of that decided during the 1992 marketing year;
(c) export subsidies that conform fully to the provisions of Part V
of this Agreement, as reflected in each Member's Schedule, shall be:
(i) subject to countervailing duties only upon a determination of injury
or threat thereof based on volume, effect on prices, or consequent impact
in accordance with Article VI of GATT 1994 and Part V of the Subsidies
Agreement, and due restraint shall be shown in initiating any countervailing
duty investigations; and
(ii) exempt from actions based on Article XVI of GATT 1994 or Articles
3, 5 and 6 of the Subsidies Agreement.
PART VIII
Article 14: Sanitary and Phytosanitary Measures
Members agree to give effect to the Agreement on the Application of
Sanitary and Phytosanitary Measures.
PART IX
Article 15: Special and Differential Treatment
1. In keeping with the recognition that differential and more favourable
treatment for developing country Members is an integral part of the negotiation,
special and differential treatment in respect of commitments shall be provided
as set out in the relevant provisions of this Agreement and embodied in
the Schedules of concessions and commitments.
2. Developing country Members shall have the flexibility to implement
reduction commitments over a period of up to 10 years. Least-developed
country Members shall not be required to undertake reduction commitments.
Continue with the Agreement on Agriculture
4 "Countervailing duties" where referred to in
this Article are those covered by Article VI of GATT 1994 and Part V of the Agreement on Subsidies and Countervailing Measures.
|