TWN Info Service on WTO and Trade Issues (Feb20/02)
18 February 2020
Third World Network

Agreement on fisheries subsidies at MC12 remains doubtful
Published in SUNS #9065 dated 11 February 2020

Geneva, 10 Feb (D. Ravi Kanth) -- The prospects for an agreement prohibiting subsidies that contribute to IUU (illegal, unreported, and unregulated) fishing, and overcapacity and overfishing among others at the upcoming WTO's 12th ministerial conference (MC12) in Nur Sultan, Kazakhstan remain doubtful, according to several trade envoys.

At the meeting last week of the Doha rules negotiating body where the fisheries negotiations are taking place, several developing countries have expressed concern over attempts to conduct the Doha fisheries subsidies negotiations through facilitators, trade envoys told the SUNS.

Due to a lack of focus and direction in the negotiations as well as the confusion over the legal status of the draft texts submitted by the facilitators, the prospects for concluding an agreement at the upcoming WTO's 12th ministerial conference (MC12) in Nur Sultan, Kazakhstan, remain doubtful, trade envoys said.

At the meeting on 6-7 February of the Doha rules negotiating body that is tasked with overseeing the fisheries subsidies negotiations, the African, Caribbean, and Pacific (ACP) group submitted a revised proposal on IUU fishing, overcapacity and overfishing, and on the scope of the subsidies within the Subsidies and Countervailing Measures (SCM) Agreement.

The European Union, Japan, Korea, and Chinese Taipei also submitted at the meeting a revised proposal on prohibition of subsidies that contribute to overcapacity and overfishing.

The ACP proposal has suggested that the scope of the disciplines involve only marine wild capture fisheries. It excluded aquaculture and internal water fishing from the proposed disciplines.

Earlier, the United States had suggested including aquaculture and internal water fishing in the proposed disciplines for prohibiting subsidies, said an ACP negotiator, who asked not to be quoted.

The ACP Group said it would explicitly exclude from the scope of the disciplines any subsidies that may be provided to recreational fishing on grounds that such subsidies contribute to tourism and generates employment and economic development in many of the small ACP member states.

It argued that inclusion of "government-to-government access agreements" or state-to-state transfers for purchase of access rights from coastal fisheries, should not be considered as subsidies.

The ACP sought to exclude such subsidies from any prohibition.

The ACP also demanded that relevant provisions of the Law of the Sea Convention relating to fisheries access arrangements must remain flexible, allowing coastal or island States to enter into all types of financial and technical arrangements on access in the exclusive economic zone (EEZ).

It suggested the exclusion of disputed waters claims from the scope of the agreement.

"This is not only an issue for more high profile Members [such as China and the Philippines] but is sometimes a point of contention within ACP regions," the ACP representative argued.

"The ACP text has been longstanding on the table and we wish to be included in the consultations of the facilitator on this issue," the ACP representative said.

As regards the special and differential treatment (S&DT) for all developing countries, the ACP said "developing countries not engaged in large-scale industrial distant water fishing are entitled to apply [x] additional years, and LDCs and small, vulnerable economies (SVEs) [y] additional years, transition period, after entry into force of this instrument, in order to establish measures against unreported and unregulated fishing."

However, the ACP proposal for S&DT has created frictions among developing countries as it has excluded developing countries with a share of more than 2% of global marine fishing from availing of special and differential treatment in the proposed IUU disciplines, said a trade envoy, who asked not to be quoted.

Several developing countries such as India among others have a share of more than 4% of the global marine fishing.

While India remains opposed to industrial-scale fishing by some countries in its EEZ, it called for protecting the interests of its more than 5 million artisanal fishermen, the envoy said.

In its proposal circulated on 14 June 2019, India has categorically said that "the prohibition under Article [Z] in respect of unreported and unregulated fishing, shall not apply to subsidies granted/maintained by developing countries including LDCs for:

(a) fishing within their territorial waters; and

(b) fishing in their EEZ and the high seas for a transition period of [X] years from the date of entry into force of this instrument."

As regards the prohibition of overfished stocks, India said that it shall not apply to subsidies granted/maintained by developing countries including LDCs for fishing in their territorial waters.

On overfishing and overcapacity, India said that "the prohibition under Article [Z] in respect of overfishing and overcapacity shall not apply to subsidies granted/maintained by developing countries including LDCs for:

(a) fishing within their territorial waters and their EEZ; and

(b) fishing by vessels in the high seas subject to the applicable fisheries conservation and management measures."

India has also called for including fuel subsidies in the prohibited category of subsidies.

Even though the WTO members had agreed to extend the deadline for concluding the fisheries subsidies agreement to the WTO's 12th ministerial conference in June at Nur Sultan, Kazakhstan, sharp differences continue to persist on a range of issues, especially over the lack of focus and direction, said a negotiator, who asked not to be quoted.

"There is a vacuum in the negotiations due to the new chair who is yet to come to grips with all the central issues in fisheries negotiations and who is not able to assert himself, unlike the previous chair Ambassador Roberto Zapata from Mexico," the negotiator said.

The new chair, Ambassador Santiago Wills from Colombia, who assumed the reins as the chair of the Doha rules negotiating body in November last year, is yet to provide clear direction, said another negotiator, who asked not to be quoted.

Except on issues such as definitions around fishing and fishing-related activities and certain exclusions around the inland fishing and aquaculture where there is little consensus, all other issues are open for negotiations, the negotiator said.

Also, there is considerable confusion over the legal status of draft texts circulated by the facilitators, as some members had expressed sharp concern that their positions were not reflected in the draft texts.

For example, the European Union and Canada apparently raised concern that their positions on overcapacity and overfishing were not reflected in the draft text issued by the facilitator Ms Katherine Dellar from Australia, the negotiator said.

At the end of the Doha rules negotiating body meeting on 7 February, the representative of the ACP group, as well as other developing countries, said that it is important to have text-based negotiations as opposed to facilitator-driven discussions, said a trade envoy, who asked not to be quoted.

The facilitators who are tasked with preparing texts in the ongoing Doha fisheries subsidies negotiations include Ms Katherine Dellar of Australia for overcapacity and overfishing, Mr Gustavo Cunha Machala of Brazil for overfished stocks, Ms Benedict Fleischer from Norway for IUU fishing, and Mr Faisal Saud Sulaiman al-nabhani from Oman for cross-cutting issues.

The facilitator on overcapacity and overfishing, Ms Dellar, issued the first draft on 5 February in which she has apparently not properly reflected proposals submitted by the European Union and Canada, said a negotiator, who asked not to be quoted.

Ms Dellar wrote in her email to members, which has been seen by the SUNS, that the text "was prepared under my responsibility and is a first draft, and indeed I expect it to evolve over time as we make progress towards consensus."

"If any delegation has concerns with aspects of the text, I request that they approach me directly to discuss their concerns, and allow open-ended sessions to be reserved for focused text-based negotiations," she said in her email.

Meanwhile, the United States and several South American countries continue to argue that there is no need for special and differential treatment for developing countries in the proposed agreement, said a negotiator, who asked not to be quoted.

Lastly, a few members have raised concern over the limiting of their interventions to five minutes during the discussions, arguing that where a member represents a large number of countries with differing positions, there should be no limitation on their interventions, said a negotiator, who asked not to be quoted. +