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Info Service on WTO and Trade Issues (May23/01) Geneva, 3 May (D. Ravi Kanth) — The chair of the Doha fisheries subsidies negotiations said that members “generally advanced our work” and “our understanding of each other’s positions” during the second “Fish Week” that ended at the World Trade Organization on 28 April, despite divergent positions and fundamental differences over certain definitional issues that marked the proceedings. During the second “Fish Week” that was held from 25 to 28 April, several definitional issues came to the fore involving large-scale, small-scale, and artisanal fishers as well as the need to classify these different categories of fishers to assess their impact in contributing to the problem of overcapacity and overfishing. However, there was little convergence between the big subsidizers such as the European Union, the United States, China, Canada, Korea, and Chinese Taipei among others on the one side, and large-scale, small-scale and artisanal fishers, on the other, said people who took part in the week-long meetings. Ahead of the meetings, the chair of the Doha fisheries subsidies negotiations, Ambassador Einar Gunnarsson of Iceland, had circulated several questions for members to reflect on. They include:
(These two draft texts – WT/MIN(22)/W/20 and WT/MIN(21)/W/5 – were issued by the previous controversial chair Ambassador Santiago Wills of Colombia, who later became Director of the Council and Trade Negotiations Committee Division at the WTO). 3. How should the disciplines on subsidies contributing to overcapacity and overfishing address subsidies to large-scale fishing, including fishing in distant waters? 4. What considerations, criteria, and principles are relevant to disciplining such subsidies? 5. How should the disciplines on subsidies contributing to overcapacity and overfishing address small-scale or artisanal fishing, and what considerations, criteria and principles are relevant to providing appropriate and effective flexibilities for subsidies to such fishing for developing and least-developed Members? CHAIR’S ASSESSMENT Ambassador Gunnarsson issued a press note on 2 May, stating that “over the week, there was widespread support for the hybrid approach, contained in previous negotiating texts WT/MIN(22)/W/20 and WT/MIN(21)/W/5, in which prohibited subsidies for overcapacity and overfishing were to be qualified based on both a list of types of government support and a condition relating to the biological sustainability of fish stocks.” However, the chair noted that the previous chair’s draft text requires “adjusting,” adding that “one member describes a different approach, building on the serious prejudice concept in Article 6 of the (WTO’s) Agreement on Subsidies and Countervailing Measures.” Apparently that one member is Australia, said a negotiator who asked not to be identified. Ambassador Gunnarsson said, “Members are keeping an open mind and are willing to engage on this new approach.” In the same tone, he acknowledged that “as MC13 draws closer, members need ample time to consider new approaches, so I invite any member thinking of a different approach to share ideas as soon as possible.” Commenting on how to deal with subsidies to large-scale fishing, including fishing in distant waters, the chair said, “Various members expressed support for retaining texts in previous negotiating documents.” Yet, he conceded that “some Members also spoke to the need to define distant water fishing based on tangible indicators and emphasized the relevance of credible data in this regard.” Without naming these countries, the chair said, “Some also proposed reduction commitments by major subsidizers.” The chair said, “One member made a concrete suggestion recalling its previously-submitted proposal to impose a long-term moratorium on granting or maintaining subsidies to fishing or fishing-related activities by a Member engaged in distant water fishing outside its exclusive economic zone.” Commenting on special and differential treatment (SDT), the chair said: “All members acknowledge that SDT is an integral part of the negotiations, and we heard differing views as to what would constitute an appropriate and effective approach.” Without naming these countries, Ambassador Gunnarsson said “those Members (the big subsidizers such as the US, the EU, and Japan among others) who see SDT as a tool to comply with the disciplines, propose that S&DT [be] provided within the disciplines themselves, without permanent carve-outs.” The chair also maintained that “members who see SDT as a tool to provide policy space call for the use of specific parameters including the level of catch, the level of development, and the level of subsidization.” Further, the chair argued that “we also heard from some members who think that S&DT can be a mixture of flexibilities within the disciplines, as well as specific parameters.” As regards artisanal fishers, the chair said, “One point of agreement is that all members recognize the need to safeguard the livelihood and food security of small-scale and artisanal fishing.” He asked somewhat rhetorically, “The question is largely how best to craft meaningful SDT without undermining the disciplines.” Without naming several big subsidizers, the chair said, “We did hear strong views that any S&DT should not be utilized by members whose vessels are engaged in distant water fishing, irrespective of the level of development.” SINGLE TEXT BY END-JULY As regards the next steps, the chair emphasized on the need to work on the basis of a single text. He said that “his ambition is to get to that point before or by the summer break in August.” “Given the readiness of many members to begin engaging in text-based discussions, I will use the time before the next fish week to explore how to move forward with this work, noting members’ collective vision to complete the second wave of negotiations by the General Council meeting in December,” the chair maintained. According to the chair, such a process would allow members to “use the remaining time before the ministerial meeting on cleaning up the text.” The chair also underscored the need to work on a “parallel” track to develop the necessary procedures, notification templates, and other documentation to be used by the (Doha) Committee on Fisheries Subsidies. This will also be conducted under the Negotiating Group on Rules based on his consultations with members, he added. Ambassador Gunnarsson expressed confidence that “everyone seems to agree that such work should take place outside of the Fish Weeks so that it does not dilute our focus on the negotiations.” MEMBERS’ VIEWS Apparently, during the meetings last week, the major subsidizers seemed to be opposed to defining the three categories of fishers and classifying them to assess/measure their specific contributions to the problem of overcapacity and overfishing (OC&OF), for arriving at appropriate disciplines, said people present at the meetings. On the other hand, several developing countries including Indonesia, Pakistan, South Africa, and other developing countries pressed for such a classification in order to arrive at a better understanding of the subsidies that need to be prohibited, as well as for deciding on special and differential treatment (S&DT) for developing and least-developed countries, said participants. More importantly, the developing countries apparently argued for enhanced S&DT provisions that would allow for the development of their fisheries sectors given the livelihood concerns of hundreds of millions of people who depend on fishing in these countries, said people who preferred not to be quoted. Some developing countries including India sought a robust S&DT regime for developing their fisheries sector, which has been under-developed all these years, said people, who asked not to be quoted. INDONESIA’S RESPONSE In a comprehensive response to the chair’s questions, Indonesia said: “The main goal of the OCOF pillar is disciplining subsidies that contribute to Overcapacity and Overfishing (OCOF).” It acknowledged the effectivity of the list-based approach in Article 5.1 outlined in document WT/MIN(22)/W/ 20 with regard to operationalizing the prohibition on certain forms of subsidies that contribute to OCOF in the Fisheries Subsidies Agreement, in line with the mandate of the UN Sustainable Development Goal (SDG) 14.6. The UN SDG 14.6 states: “by 2020, prohibit certain forms of fisheries subsidies which contribute to overcapacity and overfishing, eliminate subsidies that contribute to IUU (illegal, unreported, and unregulated) fishing and refrain from introducing new such subsidies, recognizing that appropriate and effective special and differential treatment for developing and least-developed countries should be an integral part of the WTO fisheries subsidies negotiation.” Yet, there is a need for recognition and differentiation between harmful and non-harmful fisheries subsidies to ensure positive impacts on capacity reduction and conservation, Indonesia said. Indonesia said that it remains concerned about several issues, including:
“I would like to underline that collecting such data is costly, especially for Members with more waters and species of fishes like Indonesia.” 2. Not all WTO members have adequate fisheries management systems currently in place, especially developing and LDC Members that have insufficient resources and capacity to adopt and maintain such measures. All these will create more difficulties for developing members and LDCs to reap the benefit from Article 5.1.1. 3. To address the capacity gap between members in implementing this agreement, it is important that the entry into force of this agreement should consider the availability of adequate fisheries management systems in LDCs and Developing members and not simply based on a time limit. This includes a proper framework for technical assistance and capacity building for developing and LDC members to implement adequate fisheries management and notification measures under this agreement. 4. Indonesia said that the WTO is however not a fisheries organization to prevent the misuse of Fisheries Management against our objective to fight overcapacity and overfishing. 5. Determine a clear parameter of the flexibilities covered under the Fisheries Management provision. On this note, Indonesia said that it believes that flexibilities should be limited to Member’s jurisdiction. 6. Finally, the guideline should be agreed upon by consensus to avoid future disagreements or disputes that could undermine the credibility of the Fisheries Subsidies Agreement (FSA). On the chair’s second question on how to discipline subsidies contributing to overcapacity and overfishing, Indonesia reiterated that disciplining subsidies contributing to overcapacity and overfishing is a development issue. In particular, it highlighted the threat of distant water fishing activities to the livelihoods of fishers and coastal communities globally. It argued that “a handful of distant water fishing nations (DWFN) with large fishing fleets, having depleted fish populations in their own waters, use subsidies from their governments to out-compete local, small-scale fishermen in many developing countries, and heavily exploit other countries’ EEZs and on the high seas.” Besides, “it is also a sustainability issue, whereby subsidies that contribute to overcapacity and overfishing in distant waters have negative multiplier effects on the wider marine environment, global fish stocks, and marine biodiversity,” Indonesia said. Citing some estimates, Indonesia said that DWFN account for 78% of industrial fishing efforts occurring within the national waters of lower-income countries, some of which are in off-limit areas, such as marine protected areas. According to Indonesia, “It is crucial to establish effective disciplines that can regulate these subsidies and ensure the sustainability of global fisheries.” On that note, Indonesia said it is of the view that “any measures should take locus and temporal considerations.” According to Indonesia, “temporal considerations are reflected through historical catch and subsidies of members towards distant fishing activities. The very fact that there are members who have heavily subsidized and exploited fish stocks in distant waters or the high seas as compared to “infant” fishing industries in many developing members creates unequal position between both. “Therefore, those who have historically contributed to the depletion of fish stocks must have larger limitations or even outright prohibition to continue subsidizing their distant water fleets, in accordance with the “polluter pays” principle and common but differentiated responsibility (CBDR) principle.” It argued that “locus consideration takes into account the unique geographic features of each member. In this vein, Indonesia considers general prohibition towards fishing beyond the subsidizing member’s jurisdiction as outlined in Article 5.2(a) of the W20 document have properly captured this locus consideration.” Indonesia said that it acknowledges that “footnote 13 provides policy space for members to subsidize their artisanal and small-scale fishers who engage in fishing or fishing-related activities beyond subsidizing member’s jurisdiction , but only if vessels or operators are not engaged in distant water fishing.” It argued that the flexibility should not weaken the discipline, as developing and LDC members have difficulties in developing their fisheries sector in the first place and specifically subsidizing distant water fishing would be an undue burden on their budgets. On the issue of small-scale or artisanal fishing, Indonesia said that it is of the view that any S&DT provisions be applied effectively. To this end, Indonesia said that it supports that any S&DT should be limited to areas where members have legitimate jurisdiction and to the fishers in developing nations that needed it the most, namely, artisanal and the small-scale fishers of developing members and LDCs. With these in mind, Indonesia argued that the current provisions regarding special and differential treatment are inadequate to ensure that the legitimate interests of developing and least-developed members are protected, as mandated in Sustainable Development Goal Target 14.6. For this reason, Indonesia suggested that the following elements should be included: A. Flexibilities for artisanal fishing should be made permanent, as Article 5.1.1 is permanent, and not be limited to a maritime zone of 12 nautical miles, but also include Member’s rights over their exclusive economic zone, as stated under the UNCLOS (United Nations Convention on the Law of the Sea) provisions. B. It is not appropriate to subject special and differential treatment to the notification requirements under Article 25 of the ASCM since it would place a disproportionate burden on developing and LDC Members to comply with it, making the provision inoperative. C. The de minimis factors with a fixed transition period are wholly insufficient and inconsistent with the actual development needs of developing and LDC members. Indonesia highlighted the 2005 Hong Kong Ministerial Declaration language, which recognizes the importance of special and differential treatment in the fisheries sectors to development priorities, poverty reduction, and livelihood and food security concerns. In this regard, Indonesia said it believes that changing such de minimis factors, for example, to marine capture per capita, would provide a more justifiable discipline for fisheries subsidies. D. Indonesia said it is essential to recognize the common but differentiated responsibilities and “polluter pays” principles in addressing subsidies contributing to overcapacity and overfishing for small-scale and artisanal fisheries. E. It urged developed countries with advanced fisheries sectors to take a greater share of the responsibility in addressing these issues and should be willing to provide adequate financial and technical support to developing and least-developed members that can support the development of their fisheries sector in a sustainable and responsible manner. PAKISTAN’S VIEWS Pakistan, which has substantial concerns in the fishing sector, particularly for its artisanal and small-scale fishers, said that based on the MC11 and UN SDG 14.6 mandates, it is clear that members are required to prohibit certain forms of subsidies that contribute to overcapacity and overfishing and eliminate subsidies that contribute to IUU fishing and refrain from introducing new such subsidies through the adoption of comprehensive and effective disciplines. Pakistan sought to know whether members “have successfully eliminated all subsidies contributing to IUU [fishing] or have they channelized them or qualified them; are members planning to do the same with prohibition?” It argued that many WTO members have been “advocating the reduction and eventual elimination of subsidies in agriculture and how agreements in 1995 have created an uneven field for developing and LDCs to compete in trade, and here we are in 2023.” Emphasizing that negotiating would mean qualifying subsidies yet again, Pakistan said: “In this discussion, we are also joined not only by developing countries and LDCs but also by developed countries which have realised how subsidies make it very difficult to compete.” Pakistan said it has always been flexible in its approaches and always stands with consensus among members, but “we do feel that it is important for all of us to walk the talk.” Pakistan said the MC12 mandate, which requires members to continue with the discussions based on documents WT/MIN(22)/W/20 and WT/MIN(21)/W/5 prepared by the previous chair under his own capacity, needs to be revisited. In response to the chair’s second and other questions, Pakistan said that the WTO cannot work as a fisheries management organization. However, “basing the work on provisions and regulations that have been negotiated in other organizations and will continue to be negotiated and amended in other organizations, it is important to understand those provisions, regulations, and procedures and see if those are essentially based on science, the level of reliability and the limitations, which would then help us guide discussions and negotiations,” Pakistan said. Pakistan argued that some members mentioned difficulties involved “in defining terms like large-scale industrial, small-scale, distant waters, artisanal fishing.” Yet, according to Pakistan, it sees “a problem with not defining them when we aim to address the mandate of appropriate and effective S&DT for developing and LDC members.” Therefore, it said “the priority for the second wave of negotiations for Members in line with the mandate of 14.6, MC11 and MC12 in terms of appropriate and effective S&DT is to maintain monetary and non-monetary policy space to allow industrial development of the fisheries sector with CBDR and “polluters pay” principle.” Smaller fishing nations are not responsible for the current state of fisheries and their level of responsibility for the harm done by large industrial fishing vessels cannot be equalized, it argued. The current state of fisheries with depleted stocks is a result of overcapacity and overfishing by the major subsidizers over decades, Pakistan said, adding that clearly, the big subsidizers have to shoulder the responsibility. “There have been few approaches under discussion for the application of appropriate and effective S&DT and many members have raised their priority for the de minimis approach with no geographic limit and we do see a merit in this approach,” Pakistan argued. In short, the second “Fish Week” brought to the center stage several critical issues raised by the developing countries. It remains to be seen whether the present chair will accommodate the concerns raised by the developing countries, unlike the previous chair who allegedly gave a short shrift to the developmental concerns raised by the Global South. +
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