Academic journal article McGill Journal of Sustainable Development Law

The Canada-FIT Case and the WTO Subsidies Agreement: Failed Fact-Finding, Needless Complexity, and Missed Judicial Economy

Academic journal article McGill Journal of Sustainable Development Law

The Canada-FIT Case and the WTO Subsidies Agreement: Failed Fact-Finding, Needless Complexity, and Missed Judicial Economy

Article excerpt

1. INTRODUCTION 2. RELEVANT BACKGROUND 3. FAILED FACT-FINDING AND THE UNEXPLAINABLE ABSENCE    OF THE 2011 ONTARIO AUDITOR GENERAL REPORT 4. THE BENEFIT ANALYSIS REACHED AN UNDULY COMPLICATED    LEVEL    4.1 The Quixotic Quest for a Perfect Market Benchmark        4.1.1 ONTARIO'SWHOLESALE ELECTRICITY MARKET DISQUALIFIED        4.1.2 FOUR PROPOSED OUT-OF-PROVINCE ELECTRICITY MARKETS              DISQUALIFIED        4.1.3 THE FIT PROGRAM DISQUALIFIED DUE TO INDECIPHERABLE              PRICE-SETTING        4.1.4 THE RES INITIATIVE AND QUEBECWIND ENERGY PRICES:              POTENTIALLY FITTING, YET INSUFFICIENTLY DEBATED MARKET              BENCHMARKS        4.1.5 THE PANEL'S PROPOSED APPROACH AND OBSERVATIONS ON AN              APPROPRIATE MARKET BENCHMARK    4.2 Readily Available Market Benchmarks    4.3 The Appellate Body's Separate Markets Approach        4.3.1 SEPARATE MARKETS FORWIND- AND SOLAR PV-GENERATED              ELECTRICITY        4.3.2 SEPARATE MARKETS AND THE PRIMACY OF SUPPLY-SIDE FACTORS    4.4 The Existence of a Benefit under Article 1.1(b) of the        SCM AGREEMENT, Separate Markets, and Legitimate Policy        Considerations        4.4.1 VAIN CAVEATS TO THE SEPARATE MARKETS APPROACH        4.4.2 THE APPELLATE BODY'S FAVOURABLE BIAS TOWARD AND THE              ONTARIO AUDITOR GENERAL'S SCATHING ASSESSMENT OF THE FIT              PROGRAM        4.4.3 LEGITIMATE POLICY CONSIDERATIONS AND GATT ARTICLE XX    4.5 The Ontario FIT Program's Conspicuous Largess and Intelligibly        Comparable Markets    4.6 The Panel Dissent on the Existence of a Benefit        4.6.1 THE PANEL DISSENT'S "SIMPLE 'BUT FOR' TEST"        4.6.2 "SEPARATE MARKETS" AS THE SOLE OBSTACLE TO THE "SIMPLE              'BUT FOR' TEST" 5. A MISSED OPPORTUNITY FOR JUDICIAL ECONOMY? 

On May 6, 2013 the Appellate Body of the World Trade Organization (WTO) made public its decision in the Canada--Feed-in Tariff Program (Canada--FIT) case. (1) The multitude of observers anticipated a watershed decision regarding renewable energy generation and the application of world trade law to its subsidization. Unfortunately, both the WTO Panel (2) and the Appellate Body irked such this constituency by failing to come to a decisive conclusion (3) under the WTO Agreement on Subsidies and Countervailing Measures (SCM Agreement). (4)

This comment traces this indecisiveness back to fact-finding failures on the part of both the WTO Panel and the Appellate Body and to an unwarranted complication of the test for demonstrating the existence of a benefit, and hence a subsidy, under Article 1.1(b) of the SCM Agreement. These two causes are symptomatic of the proclivity of the WTO Panel and the Appellate Body for condoning renewable energy subsidies by carving out an exemption from the disciplines of the SCM Agreement.

This case comment starts by providing an overview of the Canada--FIT dispute (Part II). Part III focuses on the fact-finding shortcomings of both the Panel and the Appellate Body and on the 2011 Report of the Ontario Auditor General? which could have helped the Panel and the Appellate Body in their analyses of the FIT Program. This case comment will then dive into the unduly complicated methodology used by both the Panel and the Appellate Body when attempting to determine whether the FIT Program conferred a benefit and, hence, a subsidy under Article 1.1(b) of the SCM Agreement. Revisiting the comparatively simple approach of the Panel's dissent, which decided that the FIT Program did confer such a benefit, will magnify the convolutedness of the Panel and the Appellate Body's analyses (Part IV).

The final part of this comment will look into why neither the Panel nor the Appellate Body invoked judicial economy to forego their inconclusive analyses under the SCM Agreement after having found a violation under Article III of the General Agreement on Tariffs and Trade 1994 (GATT6) and the WTO Agreement on Trade-Related Investment Measures (TRIMs AgreementPart V). …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.