An Examination of the 1994 GATT
Subsidies Code Procedures
As previously mentioned in Chapter 1, the government of Canada in its negotiations with the United States for a free trade agreement had made special note that it was seeking to overcome the increased use of the contingency method of trade laws of countervailing duty (CVD) and anti-dumping (AD) by the United States against Canadian products and producers. 1 As was indicated earlier in Chapter 5, Canadian or U.S. corporations can appeal bilaterally to the dispute settlement process in Chapter Nineteen of the Canada-U.S. Free Trade Agreement (FTA) and now NAFTA when appealing Canada-U.S. CVD or AD cases that have been improperly handled. 2 However, as producers and other parties in Canada and the United States can still alternatively apply to use the General Agreement on Tariffs and Trade (GATT) Subsidies or AD Code procedures, any gains made at the GATT which further prevent them from being used for protectionist purposes would be a major gain for producers in both countries. 3 As was further indicated in Chapter 6, the requirement by Canada and the United States to negotiate a Canada-U.S. Subsidies Code has been eliminated and downgraded to a Working Group, so more reliance will now be placed on the GATT system to control the application of subsidies and CVDs by the signatories to the GATT Subsidies Code. It is in light of these points that the following analysis is undertaken of the 1994 GATT Subsidies Code ( GATT 1994), which built heavily on the Dunkel text Subsidies Code proposals ( GATT 1991a) put forward in the Uruguay Round of the GATT multilateral negotiations.
This chapter concentrates on those issues that have been raised with regard to present weaknesses found in the application of the 1979 GATT Subsidies Code negotiated during the Tokyo Round. It also examines issues raised by Canadian companies concerning their experiences with the application of the 1979 GATT Subsdies Code negotiated during the Tokyo Round. It