Introduction

This panel report represents another installment in the long-standing litigation between Canada and Brazil over subsidization of sales of commuter jets by both countries. The report addresses a set of claims by Brazil closely related to prior claims concerning the practices of the Export Development Corporation as well as industrial policy entities in the Canadian province of Quebec. Brazil specifically challenged certain recent transactions where these federal and provincial entities provided certain kinds of financing assistance in connection with the sale of Bombardier aircraft (namely to Air Wisconsin, Atlantic Coast Airlines, Comair, Kendell, and Air Nostrum). For the most part the panel applied existing jurisprudence on export subsidies to the factual record. In particular, the panel applied a “private investor principle”, verifying in all instances whether the conditions that were granted by the export development and industrial policy agencies were more favorable than the conditions that were available from alternative private sources. However, it is extremely difficult to provide an adequate commentary on the panel's comparison between the conditions available in the market and those granted by the agencies because vital factual information concerning the transactions in question has been removed from the panel report for reasons of commercial confidentiality.

Thus, in our Report, we focus on several specific areas, largely of a procedural and preliminary nature, where the panel made apparently novel findings of law that have some systemic or general significance for WTO jurisprudence and practice.