ANNOUNCEMENT 14 May 2009In May 2009, the government of Canada announced a change in the required local inputs to serve domestic customers.
NUMBER OF INTERVENTIONS
See the hyperlinked materials in the description.
Ontario's feed-in tariff (FIT) program was enabled by the Green Energy and Green Economy Act, 2009 which was passed into law on May 14, 2009. The Ontario Power Authority is responsible for implementing the program. It provides for a comprehensive, guaranteed pricing structure for electricity production under long-term contracts for energy generated from renewable sources.
The program includes a domestic content requirement. Developers are required to have a certain percentage of their project costs come from Ontario goods and labour at the time they reach commercial operation. The percentage requirements are assessed on the total project cost. If designated activities are done in Ontario, developers receive a qualifying percentage towards their domestic content requirement. Criteria for designated activities range from manufacturing certain components in Ontario to retaining labour and consulting services provided by Ontario residents.
The program is now the subject of dispute-settlement in the World Trade Organization. On September 13, 2010, Japan requested consultations with Canada. Japan claimed that the measures are inconsistent with Canada's obligations under Article III:4 and III:5 of the GATT 1994 because they appear to be laws, regulations or requirements affecting the internal sale, offering for sale, purchase, transportation, distribution, or use of equipment for renewable energy generation facilities that accord less favorable treatment to imported equipment than that accorded to like products originating in Ontario; that the measures could be internal quantitative regulations relating to the mixture, processing or use of a specified amount or proportion of equipment for renewable energy generation facilities which require that equipment for renewable energy generation facilities be supplied from Ontario sources; and that the measures appear to require the mixture, processing or use of equipment for renewable energy generation facilities supplied from Ontario in specified amounts or proportions, being applied so as to afford protection to Ontario production of such equipment, contrary to the principles of Article III:1 of the GATT 1994.
Japan also claimed that the measures appear to be inconsistent with Article 2.1 of the TRIMs Agreement because they appear to be trade-related investment measures that are inconsistent with the provisions of Article III of the GATT 1994.