Disciplining Subsidies 03-10-07

2017

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2012

When once you have tasted flight, you will forever walk the earth with your eyes turned skyward, for there you have been, and there you will always long to return."-Leonardo da Vinci I would like to thank the people who inspired me to write this thesis, Boel Flodgren for igniting my interest in International Public Law, especially in the area of WTO Law. My mentor Cécile Brokelind who has been a great support through the process of developing this thesis by providing a sounding board for my ideas and giving me guidance in filtering and staying focused. Lastly, I am eternally thankful to my family for their encouragement and patience through my studies.

2019

Not long after the end of the Second World War economists and policy makers started considering free trade as a method of maximizing welfare, and also as a means of finding solutions to social and political problems. After the formation of the GATT in 1947 and WTO in 1995, governmental policies of the member states have continued moving forward to a system of free trade. The majority of nations have started following liberal trade policies, both in their pursuit of domestic economic objectives and while contributing to world trade. When government policies start inducing a system of liberal market economy, they have to modify the underlying economic concepts of government, and further make it suitable to cotemporary cross border trade requirements. First, government has to agree not to increase the existing levels of tariffs and second, when existing tariffs are lowered, it is likely that an even greater number of industries (domestic and foreign) will face the need to adjust to the...

The problem of delayed implementation in prohibited subsidy disputes is a persistent problem in the WTO dispute settlement system. This article examines the WTO remedy system for enforcing WTO rulings in prohibited subsidy disputes to suggest some ways to improve the currently "ineffective" WTO dispute settlement mechanism, at least for resolving disputes involving prohibited subsidies promptly. Through a more detailed study of the WTO remedy system in action, several shortcomings and loopholes in the WTO jurisprudence involving prohibited subsidies are identified and analyzed. In particular, issues involving the "appropriate" level of retaliation, the meaning of "withdrawal" of a subsidy, and the prolonged dispute proceedings in contrast to the requirement to remove illegal subsidy measures "without delay" are analyzed in more detail. Applying the discussions on the principle of proportionality, and the different purpose of remedies, this article suggests that the "retrospective" application of the retaliation remedy should be introduced for effectively addressing non-recurring prohibited subsidies under the WTO system. On the other hand, the remedy of monetary compensation is not a viable option as a retrospective remedy for prohibited subsidies, while the existing "fast track" procedure in place for prohibited subsidies needs to be improved in application through broadened jurisdiction of compliance panels.

Trade, Law and Development, 2023

The recent developments within the European Union (EU) with regards to foreign subsidies and the regional developments on fuel subsidies, have fuelled further the discussions on reforming the subsidization rules in the World Trade Organization (WTO). One aspect of the reform process is the categories of subsidies considered to be prohibited under the Agreement on Subsidies and Countervailing Measures (SCM), currently covering only export and local content subsidies. Hence, looking ahead this reform process, the purpose of the present paper is to analyse the legal standard of prohibited subsidies as provided for in Article 3.1 SCM, and specifically the term ‘contingent’ used in provisions 3.1 (a) and 3.1 (b). The analysis primarily focuses on the interpretation and application adopted by the WTO adjudicating bodies. The plurality of WTO case laws provides us a wide canvas on which accurate conclusions can be drawn on the scope of Article 3.1 SCM and the types of governmental interventions covered. At this point, an attempt is made to provide a more consistent interpretation of the term ‘contingent’ having in mind the customary rule of interpretation as well as the economic rationale of the existing rules. This identification mainly seeks to assemble the different pieces found in the WTO jurisprudence and the legal theory and reformulate the legal standard, proving a necessary comprehensive understanding of the rules, ahead of the reform process.

2014

The positive influence of subsidies on merchandise exports is well known from international trade theory literature. However, the empirical evidence on the relationship itself remains ambiguous. This article fills a gap in the existing pool of research by conducting a panel data empirical analysis over two decades for 140 countries to understand the relationship between their overall budgetary subsidies and aggregate merchandise export inclination. The detailed research findings of this paper underline the importance of going beyond the "Bali Package" agreed in December 2013 and concluding the Doha Round Negotiations of the World Trade Organization ("WTO"). The outline for the Bali agreement was that the Members of the WTO would exercise utmost restraint in using any form of export subsidy. Because of this inability to reach binding decisions, the Bali agreement is open ended and relies on good will and restraint. Fundamentally, this article stresses the positive impact of disciplining subsidies in particular in no uncertain terms. The results of this article lead to two important conclusions. First, the economic analysis shows that developing countries should realize that a subsidy-based trade war is more likely to put them in a disadvantageous position visa -vis the WTO developed members; and second, the legal analysis shows that the Agreement on Subsidies and Countervailing Measures ("ASCM") requires urgent clarification in the negotiating tables to ensure the global economy does not suffer major turbulences in the coming years.

2004

September 2003 saw trade talks pursuing the Doha Development Agenda at the Cancún WTO Ministerial Meeting collapse, primarily over the disagreements between rich and developing countries regarding agriculture. Despite the great pessimism that ensued, on August 1, 2004, WTO negotiators from 147 countries announced a breakthrough in negotiations to liberalize trade in agricultural products. The most striking aspect of this new framework agreement is the proposed elimination of agricultural subsidies by rich countries in return for developing countries opening up their markets to more imports. At the same time, WTO dispute resolution panels have delivered stunning decisions against the U.S. cotton subsidy program and the European Union's sugar subsidies. Clearly agriculture trade policy will be a pivotal issue determining the failure or success of the Doha round. This conference featured noted experts from senior levels of government, the private sector, and the legal profession addressing current developments in multilateral negotiations and the WTO cases on agriculture and analyzing their impact on the future of the world agricultural market. It was presented on November 16, 2004, at the

SSRN Electronic Journal, 2000

Presently the Doha Round negotiations for ensuring disciplines in the area of subsidies and countervailing measures are going on at the multilateral level. In particular, a major focus of the current negotiation is on removal of the actionable subsidies being provided in the fishery sector. The current analysis looks into the Agreement on Subsidies and Countervailing Measures and points out the areas for further reform with reference to the findings on the disputes lodged at the dispute settlement body of the WTO. In addition, the analysis attempts to identify the concern areas for the ongoing fisheries subsides negotiation.

1996