Comments of the united states on the answers of brazil to further questions from the panel to the parties following the second panel meeting

470 See US Comment on Brazil’s Answer to Question 258, para. 221.

471 See US Comment on Brazil’s Answer to Question 258, para. 221.

472 See US Comment on Brazil’s Answer to Question 258, para. 222.

473 See US Letter to Panel (January 28, 2004) (file rPFCsum.xls: for farms planting upland cotton in MY2001 upland cotton planted acreage was 15.5 million acres, oats planted acreage was 0.19 million acres, and sorghum planted acreage was 2.4 million acres).

474 Brazil’s Data Comments, para. 76.

475 Brazil’s Data Comments, para. 84 (italics added).

476 See Brazil’s Data Comments, § 10.

477 Brazil’s Data Comments, para. 87.

478 For example, the United States has collected no information on “the recipient firm’s sales” for marketing years 1999-2002.

479 Arguably, one could include all economic activities by the firm (e.g., other farm and non-farm related activities.)

480 Brazil’s Data Comments, paras. 85-98.

481 See US Comment on Brazil’s Answer to Question 204 from the Panel, paras. 34-42 (28 January 2004).

482 Para. 18.

483 Para. 19.

484 Brazil’s reference to payment programs provided under the 2002 FSRI Act, the 1996 FAIR Act, and the 1998 -2001 Appropriations Acts in no way provides the required specificity. These laws provided for a myriad of payment programmes, and it is impossible through these references to determine the payment programmes Brazil now seeks to include within the dispute.

485 Report of the Appellate Body, Guatemala – Anti-Dumping Investigation Regarding Portland Cement from Mexico, WT/DS60/AB/R, adopted 25 November 1998, para. 69.

486 See, e.g., Preliminary Ruling by the Panel, Canada – Measures Relating to Exports of Wheat and Treatment of Imported Grain, WT/DS276/12, circulated 21 July 2003, paras. 28, 32.

487 See Subsidies Agreement, Annex IV, para. 2.

488 Brazil inadvertently uses the all cotton crop yield in their calculations rather than the yield for upland cotton only.

489 Brazil’s Data Comments, para. 90.

490 See, e.g., Brazil’s Answer to Question 125(2)(a) from the Panel, para. 13 (27 October 2003).

491 See Brazil’s Data Comments, paras. 73, 92.

492 See, e.g., Brazil’s First Written Submission, para. 45 (PFC payments are reduced or eliminated if fruits or vegetables are grown “on ‘base acreage’” but not on total cropland).

493 Brazil also appears to have inadvertently copied the incorrect acreage numbers for cotton planted on farms with no cotton base for 2000 and 2001. (The 1999 figure was copied to 2000 and 2001. From the spreadsheet “Raw Data 1999-2001" the correct numbers are:

1999 1,033,617.7

2000 1,222,180.1

2001 1,347,140.2

494 Brazil’s Data Comments, fn. 173.

495 See US Answer to Question 195 from the Panel, paras. 6-11 (22 December 2003).

496 See Panel Report, United States – Imposition of Countervailing Duties on Certain Hot-Rolled Lead and Bismuth Carbon Steel Products Originating in the United Kingdom, WT/DS138/R, adopted 7 June 2000, paras. 6.65 and 6.66 (quoting and agreeing with Canada – Aircraft panel: “’A “benefit” does not exist in the abstract, but must be received and enjoyed by a beneficiary or a recipient. Logically, a “benefit” can be said to arise only if a person . . . has in fact received something.’”).

497 See, e.g., Brazil’s Further Rebuttal Submission, para. 154 (“[S]ome portion of the contract payments do find their way into increased rent and cost of land”) (footnote omitted).

498 Indeed, the 2002 Act implicitly recognized that decoupled income support payments ultimately benefit landowners by giving to the landowner the authority to choose whether to update his or her base acres on the farm. See 2002 Act, § 1101(a)(1) (“For the purpose of making direct payments and counter-cyclical payments with respect to a farm, the Secretary shall give an owner of the farm an opportunity to elect 1 of the following as the method by which the base acres of all covered commodities on the farm are to be determined.”); see also id., § 1101(b), 1101(c), 1101(e)(1), (3), (5) (Exhibit US-1).

499 Further calculations are presented in Exhibit US-154..

500 Brazil’s Data Comments, para. 4 (footnote referencing BRA-101 omitted).

501 Brazil’s Data Comments, para. 3.

502 See, e.g., US Answer to Question 195 from the Panel, paras. 6-11 (22 December 2003).

503 The United States notes but does not understand the reference in fn.3 to paragraph 4 of Brazil’s data comments to the “second bulleted point” in the Panel’s December 8 communication; that bullet point referred to “a communication from the Panel concerning the FAPRI model”.

504 Brazil’s Data Comments, para. 4.

505 US Comment on Brazil’s Answer to Question 196 from the Panel, paras. 15-18 (28 January 2004).

506 Brazil’s Data Comments, para. 17.

507 See US Comments on Brazil’s Answer to Question 204 from the Panel, paras. 34-42 (28 January 2004).

508 Brazil’s First Written Submission, para. 68 (emphasis added). We note in passing that the DSB did not initiate the Annex V procedures and that Brazil’s statement that it asked the United States questions “during the Annex V procedure” is therefore incorrect.

509 See Exhibit BRA-49 (Brazil’s questions for purposes of the Annex V procedure).

510 The United States has previously set out further evidence that decoupled payments for non-upland cotton base acres are not within the Panel’s terms of reference and that Brazil did not consider these payments to be measures within the Panel’s terms of reference. See US Comments to Brazil’s Answer to Question 204 from the Panel, paras. 32-42 (28 January 2004).

511 See Brazil’s First Written Submission, para. 60 (“Between MY1998-2001, upland cotton producers thereby received an additional amount of money, which was calculated based on their respective share of total upland cotton base times the amount of budgetary outlays allocated for upland cotton.”).

512 Brazil’s Data Comments, para. 20.

513 See 1996 FAIR Act, § 102(5) (Exhibit BRA-28).

514 The 1999 crop soybean program was provided for by a statute, PL 106-78, enacted 22 October 1999. In fact, the USDA’s programme rules were not issued until 8 June 2000, at 65 FR 36550. The amount provided in that statute was $475 million for all oilseeds, not just soybeans. As for the 2000 crop, the soybean payments were allowed by PL 106-224, in the amount of $500 million for all oilseeds, with rules that did not issue until 65 F.R. 5709 in November 2000. The amount paid was amplified for the 2000 crop by the addition of monies, long after, in PL 107-25, enacted in August of 2001. It is worth noting that all of these payments occurred well after plantings, again contradicting the contention of Brazil that non-upland cotton payments cause farmers to plant cotton.

515 See Brazil’s Data Comments, para. 90 fn. 177 (“The lower figures for MY 1999-2001 are explained by the fact that soybeans were not a contract programme crop.”).

516 Brazil’s Data Comments, para. 21.

517 See Brazil’s Data Comments, paras. 38-39 (referencing Brazil’s December 22 Answers to Questions, para. 7).

518 Indeed, the United States has cooperated in good faith in this dispute and expended extraordinary resources to do so, but Brazil put the United States in the position of violating US law or providing requested data. Brazil now seeks to have the Panel draw adverse inferences when its own request for information was over-broad in that Brazil could simply have asked the United States to apply its methodology (which, as of 3 December 2003, it had not yet disclosed, and would not until forced to do so by the Panel on 20 January 2004). The Panel should consider that it was Brazil at the second panel meeting that refused to cooperate and consider alternative means to request information that could have protected US farmers’ privacy interests. If there is an “adverse inference” to be drawn, it may be that Brazil withheld its methodology until the end of the proceeding because it knew it could not withstand a full analysis and review and because Brazil sought to distract from Brazil’s failure to provide evidence and data necessary to support its arguments based on its methodology.

519 The United States notes that it had no basis to provide any other aggregation of the data than that which it provided since it was not aware of Brazil’s allocation methodology until Brazil filed its answer to Question 258 on 20 January 2004.

520 Brazil’s Data Comments, para. 27 fn. 55.

521 The United States notes that in the same report the Appellate Body was careful to distinguish “adverse” inferences from other “inferences”, remarking that: “We note, preliminarily, that the ‘adverse inference’ that Brazil believes the Panel should have drawn is not appropriately regarded as a punitive inference in the sense of a ‘punishment’ or ‘penalty’ for Canada’s withholding of information. It is merely an inference which in certain circumstances could be logically or reasonably derived by a panel from the facts before it.” Canada – Measures Affecting the Export of Civilian Aircraft, WT/DS70/AB/R, adopted 20 August 1999, para. 200 (“Canada – Aircraft”).

522 Canada – Aircraft, WT/DS70/AB/R, para. 204.

523 US 11 February 2004 Answers to Additional Questions, paras. 1-5.

524 See Brazil’s 28 January 2004 Comments and Requests Regarding US Data, para. 55.

525 See Section 5 of Brazil’s 28 January 2004 Comments and Requests Regarding US Data.

526 Exhibit US-107.

527 Exhibit US-107 (5 U.S.C. § 552a(b)).

528 Exhibit US-107 (5 U.S.C. § 552a(b)(2).

529 US 11 February 2004 Answers to Additional Questions, para. 2.

530 Exhibit Bra-425 (Dresser Industries v United States, 596 F.2d 1231 (5^th Cir. 1979), p. 7 [**16]).

531 US 11 February 2004 Answers to Additional Questions, para. 8. As the party asserting this fact, the United States bears the burden of proving it. See e.g. Appellate Body Report, Japan – Apples, WT/DS245/AB/R, para. 157 (“It is important to distinguish, on the one hand, the principle that the complainant must establish a prima facie case of inconsistency with a provision of a covered agreement from, on the other hand, the principle that the party that asserts a fact is responsible for providing proof thereof.”).

532 Exhibit Bra-426 (Center for Auto Safety v National Highway Traffic Safety Administration, 244 F.3d 144 (DC Cir 2001)).

533 US 11 February 2004 Answers to Additional Questions, para. 3.

534 Exhibit Bra-426 (Center for Auto Safety v National Highway Traffic Safety Administration, 244 F.3d 144 (DC Cir 2001), p. 4 [*147]) (emphasis added).

535 As the party asserting this fact, the United States bears the burden of proving it. See e.g. Appellate Body Report, Japan – Apples, WT/DS245/AB/R, para. 157 (“It is important to distinguish, on the one hand, the principle that the complainant must establish a prima facie case of inconsistency with a provision of a covered agreement from, on the other hand, the principle that the party that asserts a fact is responsible for providing proof thereof.”).

536 The Web-page of the Office is found at http://www.apfo.usda.gov.

537 See http://www.apfo.usda.gov.

538 See http://www.apfo.usda.gov.

539 See http://www.apfo.usda.gov.

540 See Brazil’s 18 November 2003 Further Rebuttal Submission, para. 36.

541 Exhibit Bra-426 (Center for Auto Safety v National Highway Traffic Safety Administration, 244 F.3d 144 (DC Cir 2001), p. 3-4 [*146-*147]).

542 Exhibit Bra-427 (CNA Financial Corporation v Donovan, 830 F.2d 1132 (DC Cir 1987)).

543 Exhibit Bra-427 (CNA Financial Corporation v Donovan, 830 F.2d 1132 (DC Cir 1987), p. 23 [*1152]).

544 Exhibit Bra-427 (CNA Financial Corporation v Donovan, 830 F.2d 1132 (DC Cir 1987), p. 25 [*1154]).

545 The United States neither presents the legal provisions of the Trade Secrets Act nor explains any other pertinent information with respect to that Act. (See U.S. 11 February 2004 Answers to Additional Questions, para. 3.) Yet, as the party asserting this fact, the United States bears the burden of proving it. See e.g. Appellate Body Report, Japan – Apples, WT/DS245/AB/R, para. 157 (“It is important to distinguish, on the one hand, the principle that the complainant must establish a prima facie case of inconsistency with a provision of a covered agreement from, on the other hand, the principle that the party that asserts a fact is responsible for providing proof thereof.”).

546 US 11 February 2004 Answers to Additional Questions, para. 4.

547 US 11 February 2004 Answers to Additional Questions, para. 8.

548 See Brazil’s 18 February Comments on US Comments, Annex A, para. 11.

549 US 11 February 2004 Answers to Additional Questions, para. 7.

550 Exhibit Bra-418 (Washington Post v United States Department of Agriculture, 943 Supp. 31 (D.D.C.) 1996, p. 3). See Brazil’s 28 January Comments and Requests Regarding U.S. Data, paras. 31-34.

551 Exhibit Bra-428 (United States Department of Justice at al. v Reporters Committee for the Freedom of the Press et al., 489 US 749 (1989)).

552 Exhibit Bra-428 (United States Department of Justice at al. v Reporters Committee for the Freedom of the Press et al., 489 US 749 (1989), p. 15 [*775]).

553 Exhibit Bra-428 (United States Department of Justice at al. v Reporters Committee for the Freedom of the Press et al., 489 US 749 (1989), p. 15 [*774]).

554 Exhibit Bra-428 (United States Department of Justice at al. v Reporters Committee for the Freedom of the Press et al., 489 US 749 (1989), p. 6 [*755]).

555 Exhibit US-103.

556 See above.

557 Exhibit Bra-427 (CNA Financial Corporation v Donovan, 830 F.2d 1132, p. 25 [*1154]).

558 Exhibit US-103.

559 See Brazil’s 18 November 2003 Further Rebuttal Submission, Section 2.2.

560 See also http://www.apfo.usda.gov.

561 See Brazil’s 28 January 2004 Comments and Requests Regarding US Data, paras. 31-33.

562 US 11 February 2004 Answers to Additional Questions, para. 9. The cases cited by the United States are reproduced as Exhibits Bra-429 (Metadure Croporation v United States, 490 F. Supp. 1368 (S.D.N.Y. 1990)) and Bra-430 (Campaign for Family Farms v Glickman, 200 F.3d 1180 (8^th Cir. 2000)).

563 8 December 2003 Communication from the Panel.

564 12 January 2004 Communication from the Panel.

565 See Section 5 of Brazil’s 28 January 2004 Comments and Requests Regarding US Data.

566 US 11 February 2004 Answers to Additional Questions, para. 13.

567 US 11 February 2004 Answers to Additional Questions, para. 13. See also US 11 February 2004 Comments para. 67 and US 28 January 2004 Comments, para. 16 making the same argument.

568 Exhibit Bra-29 (Section 1000(12) of the 2002 FSRI Act)(emphasis added).

569 See also Brazil’s 28 January 2004 Comments on Question 195, para. 6-9.

570 US 11 February 2004 Comments, paras. 62-75.

571 16 February 2004 Communication from the Panel.

572 The US 11 February 2004 Comments, para. 69 incorrectly assert that “this information” refers to contract acreage

573 Exhibit Bra-101 (Questions for Purposes of the Consultations).

574 Brazil defined “upland cotton industry” as “producers, users and/or exporters of upland cotton”.

575 Exhibit Bra-49 (Questions for Purposes of the Annex V Procedure).

576 Brazil’s 24 June 2003 First Submission, note 415.

577 Brazil’s 22 July 2003 Oral Statement, para. 4.

578 Brazil’s 22 July 2003 Oral Statement, para. 4.

579 Brazil’s 11 August 2003 Answers to Questions, para. 190.

580 25 August 2003 Communication from the Panel.

581 US 27 August 2003 Comments and Answers to Additional Question, para. 20.

582 US 27 August 2003 Comments and Answers to Additional Question, para. 20.

583 US 7 October 2003 Oral Statement, para. 14.

584 US 7 October 2003 Oral Statement, para. 6.

585 US 7 October 2003 Oral Statement, para. 10.

586 US 7 October 2003 Oral Statement, para. 19.

587 Brazil’s 9 October 2003 Closing Statement, para. 2.

588 13 October 2003 Communication from the Panel.

589 US 27 October 2003 Answers to Questions, para. 23.

590 US 27 October 2003 Answers to Questions, para. 24.

591 Brazil’s 18 November 2003 Further Rebuttal Submission, para. 48.

592 Brazil’s 18 November 2003 Further Rebuttal Submission, paras. 33-48.

593 Exhibit Bra-368 (Second Statement of Christopher Campbell – Environmental Working Group, 1 December 2003) and Exhibit Bra-369 as amended on 3 December 2003 (Brazil’s Request to the United States for Farm – Specific Planting and Base Acreage Data, 3 December 2003).

594 See Exhibit Bra-368 (Second Statement of Christopher Campbell – Environmental Working Group, 1 December 2003) and Exhibit Bra-369 as amended on 3 December 2003 (Brazil’s Request to the United States for Farm – Specific Planting and Base Acreage Data, 3 December 2003).

595 8 December 2003 Communication from the Panel.

596 US 22 December 2003 Answers to Questions, para. 6.

597 Brazil’s 22 December 2003 Answer to Question 196.

598 12 January 2004 Communication from the Panel.

599 US 20 January 2004 Letter to the Panel.

600 Brazil’s 20 January 2004 Answers to Additional Questions, paras. 43-55.

601 Brazil’s 28 January 2004 Comments and Requests Regarding US Data, Section 6.

602 US 28 January 2004 Letter to the Panel.

603 3 February 2004 Communication from the Panel.

604 Brazil’s 13 February 2004 Letter to the Panel. See also Brazil’s 18 February 2004 Comments on US 11 February 2004 Comments on Brazil’s 28 January 2004 Comments and Requests Regarding U.S. Data.

605 3 February 2004 Communication from the Panel.

606 Cover Letter to US 11 February 2004 Answers to Additional Questions.

607 Brazil’s 13 February 2004 Letter to the Panel.

608 16 February 2004 Communication from the Panel.

609 16 February 2004 Communication from the Panel.

610 The only exception is administrative expenses, which Brazil takes from the “programme account” included in the U.S. Budget. See, e.g., Exhibit Bra-127 (2004 US Budget, p. 107 (line 00.09)). The US budget notes, however, that “administrative expenses are estimated on a cash basis”, rather than a present value basis. See, e.g., Exhibit Bra-127 (2004 US Budget, p. 108). See also Brazil’s 22 July 2003 Oral Statement, para. 130 (and citations included at footnote 168). In any event, the United States and Brazil use virtually identical figures for the administrative costs of the CCC programs. See Exhibit Bra-431 (Columns 5(a) and 5(b)).

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