WORLD TRADE WT/DS31/9
13March 1998
ORGANIZATION(98-1076)
Original: English
CANADA -CERTAIN MEASURES CONCERNING PERIODICALS
Status Report byCanada
Thefollowing communication, dated 12March 1998, fromthePermanent Mission ofCanada
tothePermanent Mission oftheUnited States andtotheDispute Settlement Body, iscirculated pursuant
toArticle 21.6oftheDSU.
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Status Report Regarding Implementation oftheRecommendations andRulings
intheDispute Regarding Canada -Certain Measures Concerning Periodicals
Panel Report (WT/DS31/R) and
Appellate Body Report (WT/DS31/AB/R)
PursuanttoArticle21.6oftheUnderstandingonRulesandProceduresGoverningtheSettlement
ofDisputes ("DSU"), theGovernment ofCanada presents thisfirstreport onthestatus ofthe
implementation oftherecommendation oftheDispute Settlement Body ("DSB") regarding "Canada -
Certain Measures Concerning Periodicals".
On29August 1997, Canada informed theDSBofitsintention tomeet itsobligation under
theWTO withrespect tothisdispute. Atthattime, Canada alsoadvised theDSBthata"reasonable
period oftime" would berequired tocomply withtheruling. Further toconsultations inSeptember 1997
withtheUnited States Trade Representative (USTR), itwasagreed bybothparties that15months
constituted areasonable period oftimeforimplementation. Canada accordingly informed theDSB
ofthisagreement atthemeeting heldon25September 1997.
TheDepartment ofCanadian Heritage hasinitiated aprocess ofconsultation regarding the
necessary steps tocomply withtheDSBruling.
Toachieve compliance, changes willberequired toTariff Item9897.00.00 ofthenew1998
Customs Tariff which contains theformer provisions ofTariff Code 9958 (i.e., theprohibition on
theimportation intoCanada ofperiodicals thatcontain advertising directed attheCanadian market).
Thenecessary changes totheTariff willbemade bywayofExecutive Order which willrequire approval
byCabinet andwillbesigned intolawbytheGovernor General. Amendments willalsoneedtobe
made topartV.1oftheExcise TaxActwhich imposes ataxonthevalue ofalladvertisements insplit-
runeditions ofmagazines distributed intheCanadian market. These amendments must receive
Parliamentary approval through thelegislative process forbills. Thefirststepintheprocess isapproval
byCabinet oftheproposed legislative policy before itisdrafted intheformofabill.Once authority
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isreceived andthebillisdrafted, thebillisapproved oncemore byCabinet before itisintroduced
inParliament. Thebillisthenintroduced intheHouse ofCommons andmustgothrough threereadings.
Atsecond andthirdreading, thebillissubject toafulldebate bytheHouse ofCommons. Between
second andthirdreading, thebillundergoes afullstudy, i.e.,witnesses arecalled byaParliamentary
committee where amendments maybemade. After itispassed bytheHouse ofCommons, thebill
moves totheSenate where itisgiven thesame three readings andisstudied byaSenate Committee.
Should therebeanyamendments tothebillemerging fromtheSenate, theamendments mustbereferred
backtotheHouse ofCommons forapproval.
TheGovernment isintheprocess ofseeking approval toamend therelevant legislation. At
thesame time, work isunderway toensure thatthenecessary changes willbeready fortabling in
sufficient timefortheagreed implementation.
Inresponse totheruling onCanada 'spostal subsidy, theGovernment isreviewing changes
tothePublications Assistance Program toensure thatitconforms totheDSBruling. Thisreview process
alsowillensure changes aremade tothepostal rateinorder toeliminate thedifferential pricing policy.
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