Japan Wins WTO Case over Ontario's Feed-in Tariff Program

Geneva, May 6 (Jiji Press)--The World Trade Organization's Appellate Body on Monday upheld Japan's claim filed against a controversial feed-in tariff program launched by the provincial government of Canada's Ontario. The decision is seen to be formally adopted at a meeting of the WTO's Dispute Settlement Body in early June to become the Geneva-based global trade referee's final ruling on the case. The Ontario government will be required to take corrective measures in a period of up to about a year. The feed-in tariff program was introduced in May 2009 to promote power generation using renewable energy. The Ontario government allows only companies that meet certain local content levels for solar and wind power equipment to take part in the program, in which all electricity generated with renewable energy is sold to power companies at fixed rates. The local content requirement has blocked Japanese makers of solar panels and other equipment for green power generation from landing supply contracts in the Canadian province. Judging that the Ontario program is discriminatory against foreign products and is effectively tantamount to subsidizing local makers in violation of the WTO's trade rules, the Japanese government brought the case to the WTO in September 2010 and asked the Canadian government for a review of the provincial program. But as the Canadian government rejected the request, Tokyo in June 2011 called on the WTO to set up a dispute-settling panel. In August the same year, the European Union filed a complaint with the WTO against the feed-in tariff program to join Japan over the case. The dispute settlement panel, set up in July 2011, released a report supporting Japan's claim in December last year, but Canada filed an appeal with the Appellate Body in February this year. In its report on Monday, the Appellate Body confirmed that the feed-in tariff program discriminates against foreign products. But the body turned down Japan's argument that it amounts to a subsidy program for local firms, due to a lack of sufficient evidence. END