WTO Countervailing Measures Countervailing Measures Term Paper

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," 2006, WTO Website).

Countries also may take their own actions if they believe they are being threatened without resorting to dispute resolution by the WTO, for example, they may launch they own investigation and ultimately charge a countervailing duty on subsidized imports that are found to be hurting domestic producers. The WTO also has different classes of subsidies. There are entirely prohibited subsidies such as regulations that require nations to meet certain export targets, or demand the use of domestic goods instead of imported goods vs. actionable subsidies where "the complaining country has to show that the subsidy has an adverse effect on its interests" which can be difficult to prove ("Anti-dumping, subsidies, safeguards: contingencies, etc.," 2006, WTO Website). Although temporary safeguard actions are only permitted if the injury to the domestic industry caused by a surge in imports was serious, until recently many nations used bilateral negotiations to persuade exporting countries to restrain exports voluntarily or to agree to other means of sharing markets that would enable them to avoid countervailing measures.

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This often occurred in the automobiles, steel, and semiconductors industries. Now, the WTO prohibits such measures, and it sets time limit on all safeguard actions. "Members must not seek, take or maintain any voluntary export restraints, orderly marketing arrangements or any other similar measures on the export or the import side," or they will invite countervailing actions upon themselves by the WTO ("Anti-dumping, subsidies, safeguards: contingencies, etc.," 2006, WTO Website).

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