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World Trade

Organization

 WT/DS46/R
14 April  1999
(99-1402)
Original: English

 

Brazil-Export Financing Programme for Aircraft

Report of the Panel

The report of the Panel on Brazil – Export Financing Programme for Aircraft is being circulated to all Members, pursuant to the DSU. The report is being circulated as an unrestricted document from 14 April 1999, pursuant to the Procedures for the Circulation and Derestriction of WTO Documents (WT/L/160/Rev.1). Members are reminded that, in accordance with the DSU, only parties to the dispute may appeal a panel report. An appeal shall be limited to issues of law covered in the Panel report and legal interpretations developed by the Panel. There shall be no ex parte communications with the Panel or Appellate Body concerning matters under consideration by the Panel or Appellate Body.

(Note by the Secretariat)

TABLE OF CONTENTS

I. INTRODUCTION

II. FACTUAL ASPECTS

III. FINDINGS AND RECOMMENDATIONS REQUESTED BY THE PARTIES

A. Findings of fact

B. Findings of law

C. Recommendations

IV. MAIN ARGUMENTS OF THE PARTIES

A. Preliminary Objection

B. Whether PROEX payments are subsidies within the meaning of Article 1 of the SCM Agreement that are contingent upon export performance within the meaning of Article 3.1 (a) of that Agreement

1. Whether there is a financial contribution by the Brazilian Government

2. Time at which the financial contribution is made

3. Whether PROEX payments confer a benefit

4. Whether PROEX payments are contingent upon export performance

C. whether proex payments are permitted subsidies under item (k) of the illustrative list of export subsidies

1. Whether item (k) of the Illustrative List of Export Subsidies may be used a contrario

2. Whether PROEX payments are payments within the meaning of item (k) of the Illustrative List

3. Whether PROEX payments are used to secure a material advantage in the field of export credit terms

4. Interpretation of the phrase "in the field of export credit terms" in item (k)

D. Arguments under Article 27 of the SCM Agreement

1. Whether Article 27 is Lex Specialis to Article 3 of the SCM Agreement

2. Which party bears the burden of proof

3. Arguments relating to Article 27.4 of the SCM Agreement

E. Arguments relating to the Panel's recommendations

V. ARGUMENTS PRESENTED BY THIRD PARTIES

A. European Communities

B. United States

VI. INTERIM REVIEW

VII. FINDINGS

A. The measures at issue

B. Preliminary objection by Brazil

C. Are PROEX interest rate equalization payments export subsidies?

D. Are PROEX interest rate equalization payments "permitted" by item (k) of the Illustrative List of Export Subsidies?

E. Is the prohibition on export subsidies inapplicable to Brazil by reason of its status as a developing country Member?

1. Is Article 27 Lex Specialis to Article 3?

2. Article 27.4 conditions and burden of proof

3. Has Brazil increased the level of its export subsidies?

4. Has Brazil complied with the condition that it "phase out its export subsidies within the eight-year period"?

5. Are Brazil's export subsidies "inconsistent with its development needs"?

VIII. CONCLUSIONS AND RECOMMENDATION

IX. ANNEX I: Procedures Governing Business Confidential Information and Declaration of Non-Disclosure

Note by the Secretariat: This Panel Report shall be adopted by the Dispute Settlement Body (DSB) within 30 days after the date of its circulation unless a party to the dispute decides to appeal or the DSB decides by consensus not to adopt the report. If the Panel Report is appealed to the Appellate Body, it shall not be considered for adoption by the DSB until after the completion of the appeal. Information on the current status of the Panel Report is available from the WTO Secretariat.