The ASCM, which came into force in 1995, established rules not only on how and when CVDs could be applied, but also on what kinds of potentially trade-distorting subsidies would be allowed, and what remedies were available to countries that felt they had been adversely affected by another country's subsidies.
Only two kinds of subsidies are prohibited by the ASCM (Article 2): export subsidies, and subsidies contingent upon the use of a domestically produced over imported goods. All other "specific subsidies", which are subsidies that benefit only particular com-panies or industries, are allowed, but actionable. "Actionable" means that if adverse effects can be demonstrated, the affected country can take one of several actions.
If the main concern of the complaining Member (the WTO does not use the word "country") is displacement of goods sold in its own market as a result of a non-prohibited subsidy, that Member may apply a countervailing duty. If the complaining Member's main concern is displacement of its exports in the subsidizing Member, or in a third country, by a prohibited or actionable subsidy, it may seek remedies through the WTO.
