To date, many countries have introduced various policies to promote the diffusion of renewable energy. However, as many of those policies tend to incorporate local content requirements, there is often a lack of consistency with the rules under the World Trade Organization (WTO) agreements. The present case is the second decision by the WTO adjudicators in a series of disputes that encompass the issue relating to renewable energy policy.
The factual background of the present case resembles the first case in the aforementioned series of disputes, namely Canada–FIT, and has contributed in further clarifying the precise meaning of legal elements contained in Articles III:8(a) and XX(d) of the General Agreement on Tariff and Trade (GATT). Moreover, it was the first to interpret Article XX(j). This policy discussion paper analyzes the case and considers the impact of the decisions of the WTO adjudicators on the various domestic policies including those related to government procurement and renewable energy.