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WTO confirms Ontario’s FIT’s breach rules

In a panel report issued yesterday, December 19, the World Trade Organization (WTO) confirms that Ontario’s renewable energy FIT, which includes a domestic content requirement, breaches WTO rules.

The claim that Ontario's FIT program constitutes illegal subsidies has been rejected.

Sean White

In both cases, filed by Japan and the European Union – "Canada – Certain Measures Affecting the Renewable Energy Generation Sector" (complaint by Japan, DS412); and "Canada – Measures Relating to the Feed-in Tariff Program" (complaint by the European Union, DS426) – the WTO affirms the accusations that Ontario’s renewable energy FITs, which require 60% of equipment to come from locally made sources, breach the WTO’s non-discrimination principle enshrined in the General Agreement on Tariffs and Trade (GATT) and the WTO Agreement on Trade-Related Investment Measures (TRIMS).

The claim that the FIT program also constitutes illegal subsidies has been rejected, however.

The WTO has, as such, recommended that Canada "bring its measures into conformity with its obligations under the TRIMs Agreement and the GATT 1994."

According to Bloomberg, Canada’s federal government will appeal the decision. Kirby Dier, a spokeswoman for the Ontario Ministry of Energy told the news agency, "Our position has always been that the FIT program is consistent with Canada’s obligations under the WTO agreements."