French Wheat And Wheat Flour Case

French wheat and wheat flour case in Global Commerce Policy

In this regard, french wheat and wheat flour case is: in 1958 Australia lodged a complaint in the GATT that because of subsidies granted by the French Government on exports of wheat and wheat flour, French exports of these products had displaced Australian exports to its traditional wheat flour markets in Ceylon (now Sri Lanka), Indonesia and Malaya (now Malaysia). The entries on trade policy are here. Australia maintained that France was acting inconsistently with its obligations under GATT Article XVI:3. This Article states that members should seek to avoid the use of export subsidies on the export of primary products, and that if they were using them, it should not be done in such a manner as to result in them obtaining a more than equitable share of world trade in that primary product. The case therefore centred on the meaning of “equitable share”. French exports of wheat and wheat flour in the previous 25 years had fluctuated widely, but there was a sudden increase in wheat, and especially wheat flour, exports beginning in 1954. Prices charged for French wheat flour exports had on the whole been lower than those of other exporters. The panel found that the French practices resulted in the payment of subsidies on the export of wheat and wheat flour and therefore fell within the ambit of Article XVI:3. The panel then turned to the question of whether France had in this way obtained more than an equitable share of the world market for wheat and wheat flour. The entries on trade policy are here. It noted that GATT Article XVI did not offer a definition of “equitable share”. There was, however, implicit agreement among GATT members in the light of their negotiations of the negotiations of the Havana Charter and the GATT review session of 1955 that “equitable share” applied to the global market and not to exports to an individual market. The entries on trade policy are here. It was understood also, the panel said, that the need for the efficient and economic supply of world markets should not be ignored. The panel recalled that French exports of wheat and wheat flour had risen substantially from 1954 above the levels achieved in the previous twenty years, and that they also represented an increase in France’s share of world exports in these products. The entries on trade policy are here. It concluded on the basis of the evidence on tonnages and price levels that France’s subsidy arrangements had contributed to a large extent to a share of world exports that had to be considered more than equitable. The panel recommended that France consider measures to avoid creating adverse effects on Australian exports of flour to Southeast Asian markets. This might be done through changing its payments system or entering into consultations with Australia before new contracts were concluded by French exporters of flour to these markets. This was the end of the formal GATT proceedings. The entries on trade policy are here. In April 1960 Australia and France concluded an agreement which they expected to bring a degree of stability into the market. The agreement was extended for another year in July 1961.[1]

French wheat and wheat flour casein the wold Encyclopedia

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Notes and References

1. Dictionary of Trade Policy, “French wheat and wheat flour case” entry (OAS)

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