WORLD TRADE
ORGANIZATIONG/SCM/109
16 September 2003
(03-4969)
Committee on Subsidies
and Countervailing MeasuresOriginal:  English
EXPIRY REVIEW BY ARGENTINA CONCERNING MEASURES IMPOSED
ON IMPORTS OF WHEAT GLUTEN FROM THE EUROPEAN COMMUNITIES
Request for Consultations by the European Communities
under Article 13.2 of the Agreement
The following communication, dated 15 September 2003, has been received from the
Permanent Delegation of the European Communities.
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The European Community (EC) requests consu ltations with Argentina on the expiry review
concerning measures imposed on imports of wheat gluten from the EC. These consultations arerequested in accordance with Article 13.2 of the WTO Agreement on Subsidies and Countervailing
measures (SCM Agreement).
Their purpose is to enable the EC to clarify a number of issues arising from the decision to
initiate and to point out certain deficiencies in the procedure.
The issues which the EC will raise during the consultations, relate inter alia  to :
1. Argentina appears to be in breach of Article 13(b)(i) of the Agreement on Agriculture, since it
initiated a sunset review ex-officio , i.e. on its own initiative.  Such self-initiation appears to run
counter to the peace clause , which requires “due restraint”.
2. Argentina appears to be in breach of Articles 1, 10, 14, 19.4 and footnote n° 36 of the SCM
Agreement, since the product at issue, wheat gluten, does not benefit from any subsidy granted in the
EC.  Argentina imposed countervailing measures to the said product on the basis of alleged subsidies
granted to starch and glucose, in spite of the fact that these are different products. Thus, the product
subject to the measures is not the same than the one that benefits of the alleged subsidies.
In accordance with Article 21.3 of the SCM Agr eement, Argentina is required to show that
the expiry of the countervailing duty would be li kely to lead to a continuation or recurrence of, inter
alia, subsidization.  Since wheat gluten is not subsidized, the countervailing duty should be terminated
immediately.
The European Community looks forward to agreei ng a suitable date for the consultations with
the Argentinean authorities. It is suggested that the consultations take place in Geneva.
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