Agriculture and Agri-Food Canada

Agriculture and Agri-Food Canada

March 11, 2005 12:43 ET

AAFC: Canadian Grain and Transportation Legislation Brought into WTO-Compliance


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: AGRICULTURE AND AGRI-FOOD CANADA

MARCH 11, 2005 - 12:43 ET

AAFC: Canadian Grain and Transportation Legislation
Brought into WTO-Compliance

OTTAWA, ONTARIO--(CCNMatthews - March 11, 2005) - Proposed legislative
amendments introduced in Parliament today would bring Canada into
compliance with its World Trade Organization (WTO) obligations. The
proposed amendments respond to a recent WTO Dispute Settlement Body
(DSB) finding that certain grain handling and transportation provisions
are inconsistent with Canada's international trade obligations.

On September 27, 2004, the DSB adopted the Appellate Body and Panel
reports that had earlier determined that the practices of the Canadian
Wheat Board (CWB) are consistent with Canada's international trade
obligations.

"Although the WTO found that the practices of the Canadian Wheat Board
are consistent with our international trade obligations, some minor
adjustments are required to certain practices dealing with imported
grain," said Agriculture and Agri-Food Minister Andy Mitchell. "These
proposed amendments will meet Canada's international trade requirements,
while fully maintaining the integrity of Canada's grain quality
assurance system."

The reports of both the Appellate Body and Panel found that the U.S. did
not provide any evidence whatsoever that the CWB - in structure, mandate
or activity - acts contrary to Canada's WTO obligations.

On the separate issue of the treatment of imported grain, the same Panel
found that three provisions - entry authorization requirement, mixing
permission, and rail revenue cap - were not consistent with Canada's WTO
obligations. Canada has until August 1, 2005 to comply.

A proposed amendment to the Canada Grain Act (CGA) would remove the
requirement that authorization must be sought from the Canadian Grain
Commission (CGC) before foreign grain can enter licensed grain elevators.

As well, a proposed amendment to the CGA and the Canada Grain
Regulations would remove the requirement that operators of licensed
terminal or transfer elevators must seek CGC permission to mix grain.

In place of these measures, a regulation will be introduced requiring
elevator operators to report to the CGC the origin of all grain, and if
they mix Canadian and foreign grain, to identify that grain as mixed.
This will ensure that Canadian grain is not misrepresented.

In addition, a proposed amendment to the Canada Transportation Act (CTA)
would extend the railway revenue cap to imported grain. Except for this
adjustment, the railway revenue cap policy will remain unchanged.


WTO Wheat Panel: Chronology of Events

March 31, 2003

U.S. officially requests WTO Panel to examine U.S. allegations
respecting the WTO consistency of: (I) the activities of the CWB in
relation to the disciplines on State Trading Enterprises (STEs) set out
in GATT Article XVII); (ii) certain policies affecting the importation
of grain (rail revenue cap, rail car allocation, grain entry
authorization and grain mixing).

September 2003

WTO Panel holds hearing in Geneva to examine U.S. allegations, with both
sides arguing their positions before the Panel.

December 2003

WTO Panel releases interim decision. Its findings are a clear victory
for Canada on the CWB issue. On the grain sector policies, the Panel
ruled in favour of Canada on the rail car allocation and against Canada
on the rail revenue cap, grain entry authorization and grain mixing.

February 10, 2004

WTO Panel releases its final decision on the case which confirms the
earlier interim ruling. The final decision is only released to the
parties in the case, pending translation of the document.

April 6, 2004

WTO releases a fully translated version of the final decision to the
public.

May 2004

The U.S. notifies its intent to appeal the Panel's decision related to
the CWB. Canada does not appeal the grain sector policy issues on which
it lost.

July 2004

The WTO Appellate Body holds a one-day hearing in Geneva.

August 30, 2004

The Appellate Body releases its ruling. It essentially endorses the
original Panel ruling in favour of Canada.

September 27, 2004

The WTO Dispute Settlement Body (DSB) formally adopts the Panel and
Appellate Reports on the dispute.

November 12, 2004

Agreement is reached between Canada and the U.S. on 10 months (from the
time of the WTO DSB adoption) to implement the Panel's findings on the
grain sector policy issues.

August 1, 2005

Deadline for Canada to bring itself into compliance with the WTO ruling.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Agriculture and Agri-Food Canada, Ottawa
    Minister's Office
    Elizabeth Whiting
    (613) 759-1059
    or
    Agriculture and Agri-Food Canada, Ottawa
    Media Relations
    (613) 759-7972
    www.agr.gc.ca