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Info Service on WTO and Trade Issues (May21/19) Washington DC, 26 May (D. Ravi Kanth) – The chair of the Doha Rules negotiations is facing rough waters in the fisheries subsidies negotiations due to his formulations in his draft revised text, as many members remain diametrically opposed on various issues, said people familiar with the development. The chair, Ambassador Santiago Wills from Colombia, issued the revised draft text (TN/RL/W/276) in his own capacity on 11 May and subsequently took recourse to an “opaque” process involving “confessionals” in which each member was asked to indicate three major issues that they cannot agree with. In what appears to be a chair-conducted negotiating process, instead of allowing members to negotiate the final disciplines through a bottom-up process in a member-driven organization, the chair appears to have run into rough waters during the “confessionals”, as several developing countries made it known in varying degrees of emphasis that it is difficult for them to accept his text as a basis for further negotiations, said people, who asked not to be identified. In an email sent to heads of delegation (HoD) on 21 May, the chair said that he held consultations with members last Thursday and Friday. Ambassador Wills indicated that “many Members considered that the current text reflects our work so far and saw it as a basis of an end-point draft.” Surprisingly, Ambassador Wills did not indicate the number of countries that participated in these consultations and in what format they were held, said people familiar with the consultations. Further, the chair did not indicate who these “many members” were, as a large majority of developing and least- developed countries flatly opposed his formulations on the IUU (illegal, unreported and unregulated) fishing and OC&OF (overcapacity and overfishing) pillars, said people, who asked not to be quoted. In his email, Ambassador Wills claimed that “as such, not many Members expressed deep concerns on this pillar (IUU pillar) and most of the concerns expressed were on a limited number of specific issues.” The chair’s wording seems vague and ambiguous, concealing the degree of opposition to his claim, said people, who preferred not to be quoted. The chair plans to hold an open-ended meeting with heads of delegation on 27 May “on the draft special and differential treatment (SDT) in the IUU fishing pillar, contained in Article 3.8.” “Noting that the entire provision is in brackets,” the chair said, “in the current text, a period of two years has been suggested as a conversation starter as the duration of an SDT exemption in the IUU fishing pillar.” However, Ambassador Wills acknowledged that “most Members who shared their views on this pillar commented on this draft provision, and some of these views essentially are diametrically opposed.” Ambassador Wills said that “some Members oppose having any SDT in the IUU fishing pillar (which is largely the major subsidizers from the industrialized countries), while others (a large majority of developing and least- developed countries) prefer an unconditional exemption, with no limit.” “In other words,” he said, “both of these groups of Members oppose the current text but for very different reasons, that it is either too narrow or too broad.” Ambassador Wills admitted that “it is clear that engaging based on one opposing view or another will not get us far,” arguing that “this is the reason why the current text aims to strike a mid-point between these opposing views.” The chair’s seemingly “opaque” negotiating process, which is leading to confusion and lack of transparency, has become the hallmark of these consultations, said several people, who asked not to be quoted. The chair said he plans to focus the coming session “on the text of Article 3.8 (in the IUU pillar), on a without prejudice basis, and in particular on the duration of a possible exemption.” “If you think that the current text is too broad, is there a duration that would make accepting an exemption easier for your delegation?” the chair asked. He asked members if they think “that the current text is too narrow, is there a duration that would make accepting a time-limit easier for your delegation?” “Of course, I would welcome your views on other conditions in the current text of Article 3.8 to the same end,” he said. Ambassador Wills, who has allegedly provided reverse SDT to the major subsidizers who have contributed to overcapacity and overfishing and thereby to global depletion of fish stocks, wants to focus more on the IUU pillar in Article 3 of the latest draft text on Saturday (29 May). He said that during his consultations last week, “only a few delegations raised a limited number of different specific issues regarding the IUU fishing pillar other than the concern on SDT.” These issues, he said, “include the inclusion of “[operator]” within the discipline and whether there should be automaticity of the subsidy prohibition based on an IUU fishing determination. The purpose of this session is to provide an opportunity to discuss and exchange views on such issues.” Emphasizing that there is “very little time”, the chair plans to hold consultations “in different configurations in addition to the consultations that I will be holding during the first part of the week.” He further clarified that during his consultations this week, “it was clear that SDT in general is at the top of the list for many, if not most or all, Members.” “In particular,” he said, “views on the purpose of SDT were widely divergent, as some Members see SDT as a means to achieve the overall sustainability mandate, while others see the development of their fisheries sector as the main goal of SDT.” Ambassador Wills said that “these discussions made it clear to me that this difference in views on the purpose of SDT is affecting Members’ positions on many aspects of the text.” They include: 1. The draft SDT provisions in Articles 3.8, 4.4 and 5.5 themselves; 2. The core disciplines; 3. Sustainability-based flexibility (or the reverse SDT to major subsidizers who would engage in the overcapacity and overfishing pillar and who want to retain the same flexibility under the allegedly dubious heading of sustainability-based flexibility); and 4. The overall balance of the text. In conclusion, the chair said that he plans to hold “an open-ended meeting at the HoDs level to discuss SDT generally, and across all pillars, in order to start narrowing down the issues.” DEVELOPING COUNTRIES EXPRESS GRAVE CONCERNS Several developing countries apparently conveyed their grave concerns to the chair during the “confessional” meetings last week, suggesting that his latest text with all its alleged imbalances and asymmetries can hardly be the basis for further negotiations, said people, who asked not to be quoted. Ahead of the proposed trade ministerial meeting to be convened by the WTO director-general Ms Ngozi Okonjo- Iweala on 15 July, developing countries seem alarmed that the text maintains the “status quo” in fisheries subsidies with special carve-outs and flexibilities for distant water fishing nations, said people who are familiar with the “confessionals”. During the “confessional” meetings held last week, several developing countries appear to have told the chair that the text fails to adequately address the mandate set out in the United Nations Sustainable Development Goal 14.6, which is also amplified in the Buenos Aires ministerial declaration, said a person familiar with the consultations. The chair’s latest text fails to prohibit certain forms of fisheries subsidies in the three pillars – IUU fishing, overcapacity and overfishing (OC&OF), and overfished stocks – while legitimizing the status quo by allowing the industrial-scale fishing nations to further undermine the sustainable development goals, the person said. The chair, who is allegedly clinging to “opaque confessionals” and small-group meetings, was urged to pursue an open, transparent, inclusive, and bottom-up negotiating process which could build consensus among members, said another person, who asked not to be quoted. The developing countries relayed several concerns centering on his formulations for the three pillars. In the OC&OF pillar, the concerns conveyed to the chair include that the text enables large-scale subsidizers to continue with their industrial-scale fishing fleets in high seas as per paragraph 5.1.1. It effectively paves the way for preserving the status quo. Further, the large-scale subsidizers can depend on measures promulgated by other Members, RFMOs (regional fisheries management organizations) and measures that are detrimental beyond a certain “relevant” fish species (e.g dolphin hunting), the person said. The developing countries are understood to have also raised serious concerns over the denial of “appropriate and effective” special and differential treatment as per the UN SDG 14.6. Instead, the chair has chosen to severely narrow the scope and application of SDT in all three pillars, the person said. The chair seems to have unilaterally decided a duration for SDT of two years for IUU fishing and overfished stocks, and seven years for OC&OF, without explaining how he arrived at these duration periods for SDT, the person said. The chair’s latest text, according to several developing countries, contains extremely burdensome notification requirements, imposing the burden of providing information that is directly related to subsidies, and thereby, allegedly turning the WTO into a fisheries management organization. The chair’s latest text also contains several controversial proposals, which have not been previously discussed/ negotiated. They include Article 3.5 on Port State members and Article 8 on notifications and transparency. In contrast, the chair has not included several proposals from developing countries, particularly on the SDT, as the chair’s proposals on SDT are allegedly not based on any submitted language from any member, said people, who asked not to be quoted. Despite the Trade Negotiations Committee (TNC) having decided on 4 February that “chairpersons should reflect consensus, or where this is not possible, different positions on issues,” the chair’s text appears to have decided the language unilaterally, people said. ACP AND AFRICAN GROUP ISSUE JOINT PROPOSAL Meanwhile, the chair circulated a joint proposal by the ACP (African, Caribbean, and Pacific) and the African Group on 25 May that says that these countries are “predominantly not subsidizing or engaged in large-scale industrial fishing.” Their fishing sector, according to the ACP/African Group joint proposal, “is tied to their economic development, poverty reduction and food security (according to UNEP (2005), fish represents only 7.7% of the total protein intake in the rich/developed world, whereas it represents 50% or more of animal protein in small-island developing states).” “To significantly limit policy options for the sustainable development of the fisheries in these Members would in effect put a limit on their national development and eliminate a major source of economic hope and livelihood security,” the ACP/African Group argued. This proposal, the co-sponsors said, “calls for greater flexibility of commitments for such Members with the view to proportionate responsibility for overcapacity and overfishing, reduction of poverty, protection of livelihoods and food security for developing countries.” The ACP/African Group textual proposal says that “the prohibition under paragraph 5.1 shall not apply to: (a) LDC Members for all fishing or fishing-related activities; or (b) developing country Members with a share of annual global marine capture production under [2.5] percent calculated based on the most recent published FAO data [or data notified by the Member to [the Committee]]; or (c) a developing country Member for fishing or fishing-related activities within their exclusive economic zone. Any developing country or LDC may choose to opt out of the use of this exemption.” In conclusion, this week’s meetings from 27 May onwards will indicate whether something can be formalized or not by the time of the proposed ministerial meeting on 15 July.
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