Members shall immediately report to the Committee on any provisional or definitive measures taken with respect to countervailing duties. These reports are available to the secretariat for consultation with other members. Members shall also submit semi-annual reports on compensatory measures taken during the previous six months. Semi-annual reports shall be submitted on an agreed standard form. Members recognize that subsidies can play an important role in the economic development programmes of developing countries. In exceptional circumstances, the members referred to in paragraph 1 may derogate from their notified programmes and measures, and the Committee considers that their timetable for such derogations is necessary for the transformation process. 5. Measures referred to in Annex I which do not constitute export subsidies shall not be prohibited by that provision or any other provision of this Agreement. The developing Member States referred to in point (b) of paragraph 2 shall assess their export subsidies during the eight-year period, preferably in stages. However, a Member of the developing country shall not increase the level of its export subsidies (54) and shall eliminate them within a shorter period of time than provided for in this paragraph if the use of such export subsidies does not correspond to its development needs. Where a member of the developing country considers it necessary to apply for such subsidies beyond the eight-year period, it shall consult, no later than one year before the end of that period, the Committee, which shall decide, after considering all the relevant economic, financial and development needs of the developing country concerned, whether it is justified to extend that period. If the Panel finds that the excess of the exemption is justified, the developing country concerned shall hold annual consultations with the Committee to determine whether the subsidies should be maintained.
If the Committee does not report such a finding, the member of the developing country shall progressively terminate the remaining export subsidies within two years of the end of the last authorized period. The Subsidies Agreement creates two basic categories of subsidies: those that are prohibited, those that are countervailable (i.e. subject to WTO recourse or countervailing measures). All specific grants fall into one of these categories. Previous transition periods for local content grants have expired. Least developed countries (and other developing countries that benefit from exemptions under the subsidy code) should phase out export subsidies on products that have achieved export competitiveness (provided that a country`s overall market share in that product exceeds 3.25%) (WTO/EIF, 2020). . . .