World Trade Organization Doha fisheries subsidies negotiations Chair Ambassador Einar Gunnarsson of Iceland has issued a draft text on the “disciplines on subsidies contributing to overcapacity and overfishing” pillar for upcoming negotiations in the fall, WTD has learned.
The five-page restricted room document (RD/TN/RL/174) issued on Monday and seen by WTD, appears to contain asymmetries in the provision of carveouts to big subsidizers who contributed to the problem of global depletion of fish stocks on the one side, and special and differential treatment for developing and least developed countries on the other, said people familiar with the text.
The text also brings into play the US proposal on forced labor in the section on transparency and notifications. China has repeatedly rejected the inclusion of forced labor in the previous draft text.
The Chair seems to have pushed the issue of non-specific fuel subsidies into a placeholder, suggesting that it remains an open issue. The text contains specific transparency and notification requirements on fuel subsidies in paragraph C.3.
India repeatedly maintained that subsidies from the big subsidizers are one of the major contributing factors to overcapacity and overfishing, said several persons who asked not to be identified.
Under Article A of the OC&OF pillar, the Chair listed draft disciplines saying “No Member shall grant or maintain subsidies to fishing or fishing-related activities that contribute to overcapacity or overfishing.”
The Chair listed the following subsidies that contribute to overcapacity or overfishing:
(a) subsidies to the construction, acquisition, modernization, renovation, or upgrading of vessels;
(b) subsidies to the purchase of machines and equipment for vessels (including fishing gear and engine, fish-processing machinery, fish-finding technology, refrigerators, or machinery for sorting or cleaning fish);
(c) subsidies to the purchase/costs of fuel, ice, or bait;
(d) subsidies to costs of personnel, social charges, or insurance;
(e) income support of vessels or operators or the workers they employ;
(f) price support of fish caught;
(g) subsidies to at-sea support; and
(h) subsidies covering operating losses of vessels or fishing or fishing-related activities.
In the subsequent paragraph A.1.1, the Chair provides a carveout to big subsidizers like the
European Union, the United States, Canada, Japan, Korea, Taiwan and now China – perhaps the biggest subsidizer – saying “if a subsidizing Member not falling under Article A.1.2 demonstrates in its regular notifications of fisheries subsidies under Article 25 of the SCM Agreement and Article 8 of the Agreement on Fisheries Subsidies that measures are implemented to maintain the stock or stocks in the relevant fishery or fisheries at a biologically sustainable level.”
In previous meetings, several countries challenged this specific carveout saying it is difficult to assess the measures cited in above paragraph A.1.1. The chair listed several parameters for availing this exception.
The Chair proposed that a subsidizing Member invoking this provision must provide the following:
(i) catch data by species or group of species in the fishery for which the subsidy is provided; (ii) status of the fish stocks in the fishery for which the subsidy is provided (e.g., overfished,
maximally sustainably fished, or underfished) and the reference points used, and whether such stocks are shared with any other Member or managed by an RFMO/A; and
(iii) conservation and management measures in place for the relevant fish stock.
He further clarified in the footnotes about what needs to be done in complying with the notifications.
However, going by the compliance of subsidies under the Agreement on Agriculture, it is common knowledge that these above conditions could be easily circumvented, said a person who asked not to be quoted.
Coming to special and differential treatment provisions in Article B, the Chair, on the face of it, seems to have expanded the category of special and differential treatment provisions.
In paragraph B.1 (a), the chair says “A developing country Member may grant or maintain the subsidies referred to in Article A.1 to fishing and fishing related activities within its exclusive economic zone and in the area and for species under the competence of a relevant RFMO/A for a maximum of [7] years after the entry into force of these disciplines.”
He says “A developing country Member intending to invoke this provision shall inform the Committee on Fisheries Subsidies in writing within one year of the date of entry into force of these disciplines.”
The Chair appears to have agreed to the developing countries' demand to exempt OC&OF subsidies for developing countries in the EEZ which is about 200 nautical miles or 230 miles. But he has limited the OC&OF subsidies for a period of only 7 years while the developing countries apparently demanded a permanent exemption.
He listed specific provisions for developing countries such as:
1. Subsidies granted or maintained under subparagraph (a) shall be exempt from actions based on Article A.1 and Article 10 of the Agreement on Fisheries Subsidies for a period of two additional
years after the end of the period referred to in subparagraph (a).
2. A developing country Member may seek an extension of the period referred to in
subparagraph (b) through the Committee on Fisheries Subsidies, which shall take into account the specific circumstances of that Member. Sympathetic consideration shall be given to developing country Members that demonstrate concrete progress toward implementing Article A.1.
For artisanal fisherpersons, the Chair proposed in B2 that “A developing country Member may grant or maintain the subsidies referred to in Article A.1 for low income, resource-poor and livelihood fishing or fishing related activities, up to [12][24] nautical miles measured from the baselines, including archipelagic baselines.”
In paragraph B.3, the Chair says “A developing country Member may grant or maintain the subsidies referred to in Article A.1 to fishing and fishing related activities if its share of the annual global volume of marine capture production does not exceed [0.8] per cent as per the most recent published FAO data as circulated by the WTO Secretariat. A Member remains exempted until its share exceeds this threshold for three consecutive years. It shall be re-included in Article B.3 when its share of the global volume of marine capture production falls back below the threshold for three consecutive years.”
For least developed countries, the Chair said the subsidies listed in OC&OF pillar, “shall not apply to LDC Members. An LDC Member may grant or maintain the subsidies referred to in Article A.1 to fishing and fishing related activities within its EEZ and in the area and for species under the competence of a relevant RFMO/A for a maximum of [X] years after the entry into force of a decision of the UN General Assembly to exclude that Member from the Least Developed Countries.”
By including several placeholders in the draft text, the Chair seems to have in mind to bring some new elements that may emerge from the negotiations, said people familiar with the draft text.
In paragraph C dealing with the notification and transparency requirements, the chair said “The
provisions of Article 25 of the SCM Agreement and Article 8 of the Agreement on Fisheries Subsidies shall apply to these disciplines, with the additions provided for in Articles A, B and C.”
In paragraph C.2, the chair the US’ proposal on forced labor by saying that “Each Member shall notify the Committee on Fisheries Subsidies in writing on an annual basis of:
(a) any vessels and operators for which the Member has information that reasonably indicates the use of forced labour, along with relevant information to the extent possible; and
(b) a list of any agreements in force, or existing arrangements, for obtaining access to fisheries of another coastal Member or non-Member, and such notification shall consist of: (i) the titles of the agreements or arrangements; (ii) a list of their parties (this appears to be a specific carveout for the European Union) fuel subsidies.
On fuel subsidies, the Chair says in paragraph C.3 that “Notwithstanding Article 1 of the Agreement on Fisheries Subsidies, and to the extent possible, each Member shall notify the Committee on Fisheries Subsidies in writing on an annual basis of its fuel subsidies granted or maintained by a Member to fishing and fishing related activities that are not specific within the meaning of Article 2 of the SCM Agreement.”
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