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<html> <head> <meta name="generator" content="Corel WordPerfect 10"> <meta http-equiv="content-Type" content="text/html; charset=utf-8"> <style> p { margin-top: 0px; margin-bottom: 1px } body { font-family: "Arial", sans-serif; font-size: 12pt; font-weight: normal; font-style: normal } </style> </head> <body> August 30, 2004 (1:30 p.m. EDT) No. 97 WTO UPHOLDS FAVOURABLE RULING ON CANADIAN WHEAT BOARD The Government of Canada welcomed today’s World Trade Organization (WTO) Appellate Body report, which confirms the findings in an earlier WTO Panel report that the practices of the Canadian Wheat Board (CWB) are consistent with Canada’s international trade obligations. “This ruling confirms that the CWB is a fair trader,” said Jim Peterson, Minister of International Trade. “It further supports our position at the WTO negotiating table, a position that Canada will continue to advocate as talks progress.” “The Government worked very closely with the CWB in putting forward a strong and coherent case,” said Reg Alcock, President of the Treasury Board and Minister responsible for the Canadian Wheat Board. “This Appellate ruling reflects the success of our close cooperation.” The United States had filed an appeal of the April 2004 WTO Panel report that found the CWB consistent with Canada’s trade obligations. In its report, the Panel found that the U.S. did not provide any evidence that the CWB—in structure, mandate or activity—acts contrary to these obligations. “This WTO decision reaffirms that the continuing allegations against the CWB are simply baseless,” said Andy Mitchell, Minister of Agriculture and Agri-Food. “The Government will continue to defend the ability of Canadian farmers to choose to market their products through orderly marketing systems like the CWB.” The Appellate Body report and related Panel report will both be adopted at the next WTO Dispute Settlement Body meeting in September. - 30 - A backgrounder is attached. For further information, media representatives may contact: Jacqueline LaRocque Director of Communications Office of the Minister of International Trade (613) 992-7332 Media Relations Office Foreign Affairs Canada and International Trade Canada (613) 995-1874 <a href="https://bac-lac.wayback.archive-it.org/web/20061209062718/http://www.international.gc.ca/">http://www.international.gc.ca</a> Lise Jolicoeur Press Secretary Office of the President of the Treasury Board and Minister responsible for the Canadian Wheat Board (613) 957-2666 Christine Aquino Director of Communications Office of the Minister of Agriculture and Agri-Food (613) 759-1059 Media Relations Agriculture and Agri-Food Canada (613) 759-7972 Backgrounder THE CANADIAN WHEAT BOARD AND THE WORLD TRADE ORGANIZATION At the request of the United States, a WTO panel was formed in March 2003 to examine the practices of the Canadian Wheat Board (CWB), as well as the treatment Canada accords to imported grain. The Panel delivered its findings in April 2004. The U.S. subsequently appealed the Panel’s findings on the CWB issues to the WTO Appellate Body, and an appeal hearing was held on July 12. This is the final avenue in the WTO dispute settlement process, and there can be no further appeal. Principal issues State Trading Enterprises The Panel examined U.S. allegations that the actions of the Government of Canada and the CWB are inconsistent with Canada’s obligations under GATT Article XVII - State Trading Enterprises. This article requires that the activities of state trading enterprises (STEs) be carried out in a manner consistent with the general principles of non-discriminatory treatment, unless such discrimination is based on commercial considerations. The Panel dismissed the U.S. allegations on this issue. The Panel found that the CWB’s organizational structure does not indicate that it makes non-commercial sales. It found that “the fact that the Government of Canada does not supervise the CWB’s sales operations makes it more rather than less likely that the CWB markets wheat solely in accordance with the commercial interests of the producers whose marketing agent it is.” Similarly, the Panel noted that the mandate of the CWB does not give it an incentive to act in a non-commercial manner. The Panel found “the mere fact that the CWB does not make a profit for itself does not support the conclusion that the CWB has an incentive not to make sales solely in accordance with commercial considerations.” As for actual CWB activity, the Panel found that, in addition to its findings that the structure and mandate of the CWB do not provide an incentive to make non-commercial sales, “the factual evidence adduced by the United States regarding actual CWB sales behaviour does not prove otherwise.” As for the range of WTO provisions disciplining STEs, the Panel pointed out that, in addition to being governed by the terms of Article XVII, STEs are “constrained, in effect, by the provisions of, inter alia, the Agreement on Agriculture and the SCM [Subsidies and Countervailing Measures] Agreement.” The WTO Appellate Body examined three aspects of the Panel’s decision that the U.S. alleged were legal errors. All three related to the Panel’s finding that the operations of the CWB are conducted in accordance with commercial considerations. The Appellate Body dismissed the U.S. claims on all issues. National Treatment Since Canada did not appeal the elements of the Panel’s findings on Canada’s treatment of imported grain, this element of the U.S. challenge was not reviewed by the WTO Appellate Body. The original WTO Panel examined U.S. allegations that certain Canadian grain sector policies are inconsistent with GATT Article III - National Treatment. This article requires that imported products be accorded no less favourable treatment than that accorded to like domestic products. In its final report, the Panel dismissed the U.S. allegations on one policy (the producer car program) and affirmed the U.S. claim on three others (rail revenue cap, grain segregation and entry authorization requirement). The Government of Canada is confident that Canada can comply with its WTO obligations, while fully maintaining the integrity of the grain quality assurance system. The Government will continue to work with industry on this issue with the view to implementing the Panel’s decision. </body> </html>

2006 - 2005 - 2004 - 2003 - 2002 - 2001 - 2000 - 1999 - 1998 - 1997 - 1996

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Last Updated: 2006-10-30	Top of Page	Important Notices