WTO rules against Ontario on local sourcing rules

CANADA: The World Trade Organisation has upheld complaints from Japan, the US and the EU, and found Ontario's local content rules under its renewable energy feed-in tariff program are discriminatory.

The World Trade Organisation building in Geneva
The World Trade Organisation building in Geneva

The World Trade Organization established a panel last year to hear a complaint from Japan, the US and the European Union about the rules, which require minimum domestic content levels of up to 50% for wind projects.

Canada's federal Department of Foreign Affairs and International Trade said the government would be appealing the ruling. While Ontario's energy ministry said the rules regarding the Fit program were consistent with the country's WTO obligations.

However, although the WTO's panel said the rules were discriminatory against foreign suppliers, it rejected the Japanese and EU argument that the rules amount to illegal subsidies.

Commenting on the judgement, the European Wind Energy Association (EWEA) said it sends a message to other governments with local sourcing rules, highlighting Brazil, South Africa, Turkey, Ukraine, Croatia.

EWEA policy director Justin Wilkes said: "The European Commission must use the impetus provided by this ruling to enter discussions on an international free-trade agreement on renewable energy, tackling both tariff and non-tariff barriers, ensuring a level playing field for wind power products and services, with all willing parties.

"A free trade agreement on renewable energy goods and services would bring more renewable energy online and drive down costs."

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