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TWN Info
Service on WTO and Trade Issues (Nov20/02) Geneva, 3 Nov (D. Ravi Kanth) – The chair of the Doha Rules negotiations, Ambassador Santiago Wills from Colombia, appears to have increased the pace of negotiations through his latest revised draft consolidated text on prohibiting fisheries subsidies that appears to be heavily tilted against the interests of developing countries, said negotiators familiar with the discussions. This has come despite the partial lockdown conditions announced by the Canton of Geneva over the weekend due to the sudden spike in new COVID-19 cases. At an informal heads of delegation (HoD) meeting on 2 November, the chair issued a restricted seven-page revised draft consolidated text (RD/TN/RL/126/Rev.1), in his own capacity, insisting that he is “mindful” of the Trade Negotiations Committee guidelines that the negotiating chairs, through the negotiating process, should “aim to facilitate consensus” and “seek to evolve consensus texts.” The revised draft consolidated text issued on 2 November remains heavily tilted against the interests of developing countries and “nothing really has changed,” said a negotiator, who asked not to be quoted. “There are some good elements but he has not combined the list approach with the sustainability approach in disciplines for overcapacity and overfishing, and if a country can prove that it has a good management system, then it will go free from these disciplines,” the negotiator said. “So, for developed countries and big subsidizers, it is easy to do, while for developing countries, it is very difficult to do and therefore, the burden of implementation is on developing countries and the language in Article 5.2 is creating an escape clause [of] reverse special and differential treatment for developed countries, which is not easily accessible to developing countries,” the negotiator said. Further, the special and differential treatment provisions for developing countries in exclusive economic zones are not provided, the negotiator said. The revised draft text remains heavily bracketed on almost all key issues such as the scope of the agreement, the definition of what would constitute “fish”or “fishing products”, the disciplines for prohibiting subsidies for IUU (illegal, unreported, and unregulated) fishing, disciplines for prohibiting subsidies for overcapacity and overfished stocks, and cross-cutting issues. “The revised draft text is riddled with square brackets (disagreements) on issues such as “scope” in Article 1, “definitions” as to what would constitute fish or fishing related activities in Article 2, prohibition on subsidies to IUU fishing in Article 3, prohibitions on subsidies concerning overfished stocks in Article 4, prohibitions on subsidies concerning overcapacity and overfishing in Article 5 which includes placeholders for capping as proposed by the US, Brazil, and other countries, “specific provisions for least-developed country members” in Article 6, technical assistance and capacity building in Article 7, “notifications and transparency” proposed by the US and other members in Article 8, “institutional arrangements” in Article 9, dispute settlement in Article 10, and “final provisions” in Article 11,” said another negotiator, who asked not to be quoted. In effect, the prospects for concluding the proposed Doha fisheries subsidies agreement by the end of the year remain almost bleak, said a negotiator, who asked not to be quoted. In his introductory remarks at the HoD meeting, Ambassador Wills said that he “heard from many delegations to do this by using my judgement to put forward draft amendments aimed at compromise solutions.” “As such, my intention is to try to find language that ultimately all delegations will be able to live with, even if it does not reflect 100% of anyone’s preferences,” the chair said. However, he did not indicate the names of the delegations that asked him to use his judgement in proposing compromise solutions that seem to be tilted against the interests of tens of millions of fishermen in developing countries, said a negotiator, who asked not to be quoted. Ambassador Wills admitted that “a lot of work remains for all delegations before we get to a full consensus on the large number of issues that remain outstanding.” The revised draft text remains bracketed and it is entirely without prejudice to any Member’s position on any issues addressed in the latest revised draft text, the chair said, arguing that he avoided a “Christmas tree” approach that would seek to reflect every suggestion that has been made. The chair said that “in developing the suggested changes introduced in the revised draft, I identified three types of issues based on our collective work: first, there were some areas of substance that could be clarified, or options that could be narrowed based on our work so far; second, there were placeholders with no text where some text could be proposed, with brackets where necessary, based on our work; and third, there were purely technical glitches or clarifications, including editorial or formatting errors, that could be resolved.” Commenting on Article 1 concerning “scope”, the chair said that he added a footnote “to make it very clear that aquaculture and inland fisheries are “excluded from the scope” of the new disciplines by using that language instead of the previous formulation that read “this excludes aquaculture and inland fisheries”. On “definitions” of what would constitute “fish” in Article 2, the chair said that he “incorporated the definition of “fish” from the Port State Measures Agreement (PSMA), which is also where other definitions in Article 2 are sourced: the definitions of “fishing”, “fishing related activities”, and “vessel”.” The PSMA was part of a UN Food and Agriculture Organization (FAO) agreement that was concluded in 2009. “However, the definition of “fish” is in its entirety, including this phrase, taken from the PSMA and I did not change it, and the same is true of the definition of “fishing”,” according to the chair’s introductory remarks set out in the restricted document (RD/TN/RL/126/Rev 1/Add.1). In Article 3 of the revised draft text relating to IUU fishing, the chair said that “Article 3.1, which contains the prohibition, is clarified to refer to “illegal, unreported or unregulated (IUU) fishing” to indicate that any one of those types of fishing (illegal, unreported, or unregulated) would trigger the prohibition; that is, that not all three – illegal, unreported and unregulated fishing – would need to be present simultaneously for the prohibition to be triggered.” The chair went on to provide clarifications on IUU disciplines, such as “due process requirements for IUU determinations” in Article 3.3, on proportionality and minor infractions in Article 3.4, effectiveness of the IUU provisions in Article 3.5, and the minimum duration of the prohibition in Article 3.6. On another controversial issue of the disciplines for “overcapacity and overfishing” in Article 5, the chair acknowledged that, “Overcapacity and overfishing disciplines have long been one of the most complicated issues in these negotiations.” “And an attempt to find compromise has resulted in a hybrid approach in the initial draft consolidated document. That is, a combination of a list approach and some sustainability elements,” the chair said. Ambassador Wills said “as indicated in my latest Aide Memoire, in my view, an emerging message is that any listing in these provisions might be clearer and simpler if it is a listing of prohibited subsidies as opposed to the current formulation that lists costs.” “On the basis of all of our discussions based on the original draft, I have attempted a re-draft,” the chair said, adding that in re-formulating these provisions, he took three issues into consideration: “first, a concern by some on the condition that a subsidy “reduces” capital or operating costs, as well as the sustainability condition; second, an emerging preference to list subsidies as opposed to costs, without prejudice to whether the list is indicative or exhaustive; and third, the need by some for an exception based on measures being implemented to maintain stocks at a sustainable level.” The chair claimed that “the objective of this re-formulation is to have a strong prohibition for certain forms of subsidies that contribute to overcapacity and overfishing as per our mandate, while taking into account mitigating policies based on sustainability, thus maintaining a hybrid approach.” “After hearing all views expressed regarding the original drafting, and reviewing the various proposed amendments, this seems to represent a middle ground that I hope Members will consider carefully,” the chair said. But the chair’s proposed “middle ground” language is all aimed at providing a carve-out for the big subsidizers such as China, the European Union, the United States, Japan, Korea, and Chinese Taipei among others, said a negotiator, who asked not to be quoted. Further, on special and differential treatment (S&DT) in overcapacity and overfishing disciplines, the chair said that “on S&DT, in my view, the further work on S&DT will need to include frank and genuine engagement regarding the draft criteria-based provisions in Article 5.7(c). The current draft reflects a complex approach, composed of many concepts including territorial waters, GNI (gross national income), global catch share, distant water fishing, and composition of GDP (gross domestic product).” “This will require all of us to be open-minded. I would ask those who are sceptical about a criteria-based approach to consider whether there are, nonetheless, criteria and thresholds that you could live with,” the chair said. Despite the latest partial lockdown conditions imposed by the Geneva Canton to fight the sudden spike in COVID-19 cases, the chair appears eager to convene negotiations in a virtual format, said a negotiator, who asked not to be quoted. Maintaining that members need to remain flexible in the current COVID-19 situation, “I envision taking some time to talk to you bilaterally or in small-groups with the possibility of joining virtually, everyone,” the chair said, suggesting that he will inform members after he has a concrete plan. REVISED DRAFT CONSOLIDATED TEXT The revised draft consolidated text is highlighted below: Article 1: Scope 1.1 This [Instrument] applies to subsidies, within the meaning of Article 1.1 of the SCM [Subsidies and Countervailing Measures] Agreement that are specific within the meaning of Article 2 of that Agreement, to marine wild capture fishing and fishing related activities at sea. 1.2 [Notwithstanding paragraph 1 of this Article, this [Instrument] also applies to fuel subsidies to fishing and fishing related activities at sea that are not specific within the meaning of Article 2 of the SCM Agreement.] Article 2: Definitions For the purpose of this [Instrument]: (a) [“fish” means all species of living marine resources, whether processed or not]; (b) “fishing” means searching for, attracting, locating, catching, taking or harvesting fish or any activity which can reasonably be expected to result in the attracting, locating, catching, taking or harvesting of fish; (c) “fishing related activities” means any operation in support of, or in preparation for, fishing, including the landing, packaging, processing, transshipping or transporting of fish that have not been previously landed at a port, [as well as the provisioning of personnel, fuel, gear and other supplies at sea]; (d) “vessel” means any vessel, ship of another type or boat used for, equipped to be used for, or intended to be used for, fishing or fishing related activities; (e) “operator” means the owner of the vessel, or any person on board, who is in charge of or directs or controls the vessel. Article 3: Prohibition on subsidies to illegal, unreported and unregulated fishing 3.1 No Member shall grant or maintain any subsidy to a vessel [or operator] engaged in illegal, unreported or unregulated (IUU) fishing. 3.2 For purposes of paragraph 3.1, a vessel [or operator] shall be considered to be engaged in IUU fishing if a determination thereof is made by any of the following: (a) a coastal Member, for activities in waters under its jurisdiction; or (b) [a flag State Member, for activities by vessels flying its flag; or] (c) a relevant Regional Fisheries Management Organization or Arrangement (RFMO/A), in accordance with the rules and procedures of the RFMO/A, in areas and for species under its competence; or (d) [a subsidizing Member for activities by vessels it subsidizes; or] (e) [a port State Member for a vessel that is in one of its ports, provided it acted in cooperation with the flag State and, where appropriate, the coastal State, or acted in a situation where the flag State did not within a reasonable period of time inform the port State of action undertaken in response to alleged IUU fishing by vessels flying its flag when such allegations have been reported to the flag State by the port State concerned.] 3.3 (a) A determination under paragraph 3.2 refers to the final finding by a Member and/or the final listing by an RFMO/A that a vessel [or operator] has engaged in IUU fishing. (b) [The prohibition under paragraph 3.1 shall apply where the determination under subparagraphs 3.2[(a), 3.2(c), and 3.2(e)] is based on positive evidence and follows due process, [in accordance with relevant international law]]. (c) [If the flag State [or subsidizing Member] is known, a Member shall promptly notify the flag State [or subsidizing Member] of the initiation of an IUU investigation [, and provide an opportunity to the flag State [or subsidizing Member] to provide information to be taken into account in the determination.]] 3.4 [In applying the prohibition in paragraph 3.1, the subsidizing Member may take into account the [nature, gravity and repetition] [seriousness] of IUU fishing committed by a vessel [or operator]]. 3.5 [The prohibition in paragraph 3.1 shall apply as long as the sanction resulting from a determination triggering the prohibition remains in force, or as long as the vessel [or operator] is listed as engaged in IUU fishing, whichever is the longer. In no case shall the duration of the prohibition be less than [X] months from the date on which it first took effect.] 3.6 [Each Member shall ensure that this provision is effective in securing compliance, discouraging infractions and depriving offenders of benefits accruing from their IUU fishing activities.] 3.7 Each Member shall have laws, regulations and/or administrative procedures in place to ensure that subsidies referred to in paragraph 3.1, including such subsidies existing at the entry into force of this [Instrument], are not granted or maintained. 3.8 Each Member shall notify to the WTO [PLACEHOLDER – RELEVANT BODY] its laws, regulations and/or administrative procedures referred to in paragraph 3.7. This notification shall be made no later than the entry into force of this [Instrument]. Each Member shall promptly notify any subsequent amendments to its relevant laws, regulations and/or administrative procedures. 3.9 [The prohibition under paragraph 3.1 in respect of unreported and unregulated fishing, shall not apply to: (a) subsidies granted or maintained by developing country Members, including Least Developed Country (LDC) Members, for fishing or fishing related activities by vessels other than large scale industrial fishing vessels within their territorial sea; (b) [PLACEHOLDER – TRANSITIONAL PERIOD SDT FOR UU]] Article 4: Prohibition on subsidies concerning overfished stocks 4.1 No Member shall grant or maintain subsidies for fishing or fishing related activities regarding an overfished stock when any of the following situations related to that stock are present: (a) lack of recovery of the stock; or (b) continuous reduction in the level of the stock. 4.2 A fish stock is overfished if it is [ALT1 recognized as overfished by the Member under whose jurisdiction the fishing is taking place or by a relevant RFMO/A based on best scientific evidence available to and recognized by them.] [ALT2 at such a low level that mortality from fishing needs to be restricted to allow the stock to rebuild to a level that produces maximum sustainable yield (MSY) or alternative reference points based on the best scientific evidence available to and recognized by the Member.] 4.3 A Member may grant or maintain the subsidies set out in Article 4.1 if the subsidies and/or other appropriate measures are implemented in a manner that ensures rebuilding of the stock to a biologically sustainable level as determined by the coastal Member under whose jurisdiction the fishing is taking place or a relevant RFMO/A in areas and for species under its competence. 4.4 [For the purposes of [paragraphs 2 and 3 of this Article], in case of overlap between the area of jurisdiction of a coastal Member and the area of competence of a RFMO/A, the determination made by the coastal Member shall prevail.] 4.5 [PLACEHOLDER – UNASSESSED STOCKS] 4.6 (a) [The prohibition under paragraph 4.1 shall not apply to subsidies granted or maintained by developing country Members, including LDC Members, for fishing or fishing related activities within their territorial sea. (b) [PLACEHOLDER – TRANSITIONAL PERIOD SDT FOR OFS]] Article 5: Prohibition on subsidies concerning overcapacity and overfishing 5.1 No Member shall grant or maintain subsidies to fishing or fishing related activities that contribute to overcapacity or overfishing. 5.1.1 For the purpose of paragraph 5.1, subsidies that contribute to overcapacity or overfishing [include]: (a) subsidies to construction, acquisition, modernisation, 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. 5.2 Notwithstanding paragraph 5.1, a Member may grant or maintain subsidies referred to in paragraph 5.1 if it demonstrates that measures are implemented to maintain the stock or stocks in the relevant fishery or fisheries at a biologically sustainable level. 5.3 No Member shall grant or maintain subsidies: (a) contingent upon, or tied to actual or anticipated fishing or fishing related activities at sea in areas beyond the subsidizing Member’s jurisdiction (whether solely or as one of several other conditions), including subsidies provided to support at-sea fish-processing operations or facilities, such as for refrigerator fish cargo vessels, and subsidies to support tankers that refuel fishing vessels at sea; (b) provided to fishing or fishing related activities outside of the jurisdiction of a coastal Member and outside the competence of a relevant RFMO/A. 5.3.1 With respect to subparagraph 5.3(a), the mere fact that a subsidy is granted or maintained to vessels or operators that may be engaged in fishing or fishing-related activities in areas beyond the subsidizing Member’s jurisdiction shall not for that reason alone be considered a prohibited subsidy within the meaning of subparagraph 5.3(a). 5.4 [No Member shall grant or maintain subsidies for a vessel not flying the flag of the subsidizing Member.] 5.5 [PLACEHOLDER – CAPPING] 5.6 [PLACEHOLDER – LIST OF NON-HARMFUL SUBSIDIES] 5.7 (a) [The prohibition under paragraph 5.1 shall not apply to subsidies granted or maintained by LDC Members for fishing or fishing related activities. (b) The prohibition under paragraph 5.1 shall not apply to subsidies granted or maintained by developing country Members for fishing or fishing related activities within their territorial sea. (c) The prohibition under paragraph 5.1 shall apply to subsidies granted or maintained by developing country Members including LDC Members, for fishing or fishing related activities within their EEZ and the area of competence of RFMO/A if all the following criteria are met: i. the Member’s GNI per capita exceeds US$5,000 (based on constant 2010 US dollars) for three consecutive years; ii. the Member’s share of the annual global marine capture fish production exceeds 2% as per the most recent published FAO data; iii. the Member engages in distant water fishing; and iv. the contribution from Agriculture, Forestry and Fishing to the Member’s annual national GDP is less than 10% for the most recent three consecutive years.] Article 6: [Specific provisions for LDC Members] 6.1 [Provisions relating to LDC Members shall continue to apply for a transitional period of [X] years after the entry into force of a decision of the UN General Assembly to exclude a Member from the “Least Developed Countries” category.] 6.2 [A Member shall exercise due restraint in raising matters involving an LDC Member and solutions explored shall take into consideration the specific situation of the LDC Member involved, if any.] Article 7: Technical assistance and capacity building [The developed country Members, and the developing country Members declaring themselves in a position to do so, shall provide targeted technical assistance and capacity building assistance to other developing country Members, including LDC Members, for the purpose of implementation of the disciplines under this [Instrument].] Article 8: Notification and transparency 8.1 In order to strengthen and enhance notifications of fisheries subsidies, and to enable more effective surveillance of the implementation of fisheries subsidies commitments, each Member shall [, to the extent possible,] provide the following information as part of its regular notification of fisheries subsidies under Article 25 of the SCM Agreement: (a) [PLACEHOLDER – LIST OF SPECIFIC INFORMATION TO BE NOTIFIED] 8.2 Each Member shall notify [the relevant SCM body/the Committee established under paragraph 9.1] in writing on an annual basis of: (a) any list of vessels and operators that it has determined as having been engaged in IUU fishing; and (b) where applicable, a list of its fisheries access agreements in force with another government or governmental authority, and such notification shall consist of the titles of the agreements and a list of their parties. 8.3 A Member may request additional information from the notifying Member regarding the notifications and information provided under paragraphs 1 and 2. The notifying Member shall respond to that request as quickly as possible in writing and in a comprehensive manner. If a Member considers that a notification or information under paragraphs 1 and 2 has not been provided, the Member may bring the matter to the attention of such other Member or to the [Committee]. Article 9: [Institutional arrangements] [9.1 There is hereby established a [COMMITTEE NAME] composed of representatives from each of the Members. The Committee shall elect its own Chair and shall meet not less than twice a year and otherwise as envisaged by relevant provisions of this [Instrument] at the request of any Member. The Committee shall carry out responsibilities as assigned to it under this [Instrument] or by the Members and it shall afford Members the opportunity of consulting on any matter relating to the operation of this [Instrument] or the furtherance of its objectives. The WTO Secretariat shall act as the secretariat to the Committee.]* * Editorial note: This provision which copies the language of Article 24.1 of the SCM Agreement would be directly relevant to disciplines in the form of a standalone agreement. A similar provision may be useful to disciplines in the form of an Annex to the SCM Agreement. 9.2 Each Member shall, within one year of the date of entry into force of this [Instrument], inform the [Committee] of measures in existence or taken to ensure the implementation and administration of this [Instrument], including the steps taken to implement prohibitions set out in Articles [3, 4 and 5]. Each Member shall also inform the [Committee] of any changes to such measures thereafter. The [Committee] shall review annually the implementation and operation of this [Instrument], taking into account the objectives thereof. 9.3 Each Member shall, within one year of the date of entry into force of this [Instrument], provide to the [Committee] a description of its fisheries regime with references to its laws, regulations and administrative procedures relevant to this [Instrument], and promptly inform the [Committee] of any modifications thereafter. A Member may meet this obligation by providing to the [Committee] an up-to-date [URL][electronic link] to the Member’s or other appropriate official web page that sets out this information. [9.4 The Committee shall examine [frequency] all information provided pursuant to Articles 3 and 8 and this Article.] 9.5 The [Committee] shall maintain close contact with the relevant international organizations in the field of fisheries management, especially with the Food and Agriculture Organization of the United Nations (FAO) and relevant RFMO/As. 9.6 Not later than [X] after the date of entry into force of this [Instrument] and periodically thereafter, the [Committee] shall review the operation of this [Instrument] with a view to making all necessary modifications to improve the operation of this [Instrument], taking into account the objectives thereof. Article 10: Dispute settlement [The provisions of Articles XXII and XXIII of GATT 1994 as elaborated and applied by the Dispute Settlement Understanding, and Article 4 of the Agreement on Subsidies and Countervailing Measures shall apply to consultations, the settlement of disputes, and remedies under this [Instrument], except as otherwise specifically provided herein.] Article 11: Final provisions 11.1 Except as provided in Articles [3 and 4], nothing in this [Instrument] shall prevent a Member from granting a subsidy for [natural] disaster relief, provided that the subsidy is: (a) limited to the relief of a particular [natural] disaster; (b) limited to the affected geographic area; (c) time-limited; and (d) in the case of reconstruction subsidies, limited to restoring the affected area, the affected fishery, and/or the affected fleet up to [a sustainable level of fishing and/or fishing capacity as established through a scientific-based assessment of the status of the fishery and in no case beyond] its pre-disaster level. 11.2 (a) This [Instrument], including any findings, recommendations, and awards with respect to this [Instrument], shall have no legal implications regarding territoriality or delimitation of maritime jurisdiction. (b) A panel established pursuant to [Article 10 of this Instrument] shall not entertain any claim that would require it to address any issues of territoriality or delimitation of maritime jurisdiction that is contested by a party or a third party.
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