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TWN
Info Service on WTO and Trade Issues (Jan24/02) Geneva, 10 Jan (D. Ravi Kanth) — The chair of the Doha fisheries subsidies negotiations, Ambassador Einar Gunnarsson of Iceland, on 21 December issued a draft consolidated text as the “new basis” of the “final push” for concluding the negotiations on disciplines on subsidies contributing to overcapacity and overfishing (OCOF) that are responsible for the global depletion of fish stocks, before the upcoming WTO’s 13th ministerial conference (MC13) that begins in Abu Dhabi on 26 February 2024, said people familiar with the development. In his email sent to members on 21 December, the chair said he hopes the two documents – TN/RL/W/277 and the associated addendum in TN/RL/W/277/Add.1 – could get members “closer to convergence – specifically, whether it reflects approaches that Members can live with, versus their ideal.” The fate of the chair’s two documents, seen by the SUNS, will become clear during the “intensive continuous negotiations from 15 January through 9 February.” The result from this intensive phase of negotiations will be known before the chair of the WTO’s General Council sends her final report to the trade ministers on 14 February. In his draft text (TN/RL/W/277), the chair suggested the following concerning subsidies that contribute to overcapacity and overfishing: “No Member shall grant or maintain subsidies to fishing or fishing-related activities that contribute to overcapacity or overfishing. For the purpose of this paragraph, 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 [except for such subsidies implemented for subsistence purposes during seasonal closures]; (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. Before granting a subsidy, a Member shall consider the consequence of the subsidy on overcapacity and overfishing.” The chair clarified in a footnote that the above disciplines do not “apply to subsidies to the extent they regard stocks that are overfished.” The OCOF subsidies, as they are referred to in the negotiating lingo, are allegedly provided mainly by the five largest subsidizers including the European Union, the United States, China, Japan, and Korea. The draft text goes on to seemingly give leeway to the 20 largest providers of fisheries subsidies to continue with the above subsidies provided they demonstrate “that measures are implemented that can reasonably be expected to ensure that the stock or stocks in the relevant fishery or fisheries are at a biologically sustainable level.” During the negotiations, several members questioned the carveouts being given to the big subsidizers, saying that though there are strong notification and transparency provisions, they may not guarantee that stocks are being maintained at “a biologically sustainable level.” In the addendum to the draft text, the chair clarified that “the core discipline continues to be based on the “hybrid approach” combining a statement of the prohibition and a list of presumptively prohibited fisheries subsidies, with a qualification to the prohibition based on sustainability elements.” The chair said, “in general terms, under the hybrid approach, the subsidies and sustainability measures would be the subject of a demonstration that sustainability measures were in place for the fish stocks in respect of which the subsidies were provided.” The demonstration process “would begin with notifications to the Committee on Fisheries Subsidies.” Several members from the Africa Group and the ACP (African, Caribbean and Pacific) group of countries challenged the sustainability criterion on grounds that the big subsidizers are being let off the hook despite causing massive harm to global fish stocks through their OCOF subsidies. The draft text seems to have retained the provision relating to access agreements to fish in other territories, which are allegedly the mainstay of the European Union’s fishing policies. Several members said that such access agreements would constitute a subsidy that has to be subjected to strong disciplines, said a person. The chair also proposed language on distant-water fishing, which seems to be targeted against China. According to the draft text, “No Member shall grant or maintain subsidies contingent upon, or tied to, actual or anticipated fishing or fishing related activities in areas beyond the subsidizing Member’s jurisdiction (whether solely or as one of several other conditions).” In the addendum, the chair said that “this provision is a standalone discipline, and its drafting remains unchanged from the counterpart provision of RD/TN/RL/174 except for an additional footnote, footnote 6. The purpose of this footnote is to address a concern of some Members that their subsidies could be prohibited solely because the maritime zones under their jurisdiction do not have a definitively determined EEZ.” S&DT The developing countries have repeatedly raised concerns about the proposed weak language on special and differential treatment (S&DT) provisions, even though they did not historically provide massive OCOF subsidies that caused the global depletion of fish stocks. Against this backdrop, the chair proposed the following provisions on S&DT that do not seem to provide equity like the carveouts being given to the big subsidizers contributing to OCOF, said a developing country trade official, who asked not to be quoted. According to the latest draft text, the S&DT provisions under the heading of Article B include: B.1 The prohibition under Article A.1 shall not apply to LDC Members. A graduated LDC Member may grant or maintain the subsidies referred to in Article A.1 to fishing and fishing related activities within its Exclusive Economic Zone (EEZ) and in the area and for species under the competence of an RFMO/A through which the Member has fishing rights, 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” category. B.2 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.2 when its share of the global volume of marine capture production falls back below the threshold for three consecutive years. B.3 (a) Except as provided for in Article B.6, a developing country Member not covered by Article B.1 or B.2 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 an RFMO/A through which the Member has fishing rights, for a maximum of [X] years after the entry into force of these disciplines. Thereafter, such a developing country Member that would otherwise fall under Article A.1.1(a) may instead apply Article A.1.1(b) in respect of subsidies referred to in Article A.1 for a maximum of [Y] years. 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. (b) 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 the first sentence of subparagraph (a). (c) A developing country Member to which subparagraph (b) applies may request an extension of the period referred to in that provision through the Committee on Fisheries Subsidies. The Committee shall take into account the specific circumstances of that Member, and shall give sympathetic consideration to developing country Members that demonstrate concrete progress toward implementing Article A.1. B.4 Except as provided for in Article B.6, a developing country Member not covered by Article B.1 or B.2 may grant or maintain the subsidies referred to in Article A.1 for low income, resource poor [and][or] livelihood fishing or fishing related activities up to [12][24] nautical miles, measured from the baselines, including archipelagic baselines. B.5 While applying Article B, a Member shall endeavour to ensure that its subsidies do not contribute to overcapacity or overfishing. In the addendum, the chair explained that “Article B contains provisions on special and differential treatment (SDT) for developing Members and LDC Members in relation to the draft disciplines on subsidies concerning overcapacity and overfishing.” He said “Article B.1 provides for SDT for LDC Members and graduating LDC Members, and it largely reflects the counterpart provisions in documents RD/TN/RL/174 and RD/TN/RL/184. The language “under the competence of a relevant RFMO/A” has been replaced with “under the competence of an RFMO/A through which the Member has fishing rights” to provide more clarity. Ambassador Gunnarsson said “Article B.2 mirrors the language of the corresponding provisions in documents RD/TN/RL/174 and RD/TN/RL/184, exempting from the disciplines in Article A.1 developing Members that fall below a de minimis threshold based on their share of global marine capture production. A footnote has been added to clarify that this provision also applies to graduated LDC Members that fall below this de minimis threshold after the expiry of the transition period referred to in Article B.1. The brackets around [0.8] have been retained given the existing divergences among Members regarding the appropriate share of global marine capture production to use as the threshold.” On the crucial Article B.3, the chair said that “the transition period in Article B.3 has been modified to reflect the new structure of the two-tier sustainability-based conditionality. As before, Article B.3 would apply only to developing Members that are neither LDCs nor below the de minimis level of capture production.” He said that “keeping in mind that some developing Members could fall within the first tier, Article B.3 (a) provides two transition periods. First, a developing Member falling under this provision would, without having to meet the sustainability-based conditionality, have a maximum of [X] years after entry into force of the disciplines to grant or maintain the subsidies referred to in Article A.1 within its exclusive economic zone and in the area and for species under the competence of an RFMO/A through which the Member has fishing rights. Second, a developing Member falling under this provision that would be amongst the top 20 subsidizers would have an additional maximum of [Y] years after the [X] years, during which it could apply Article A.1.1 (b) instead of Article A.1.1 (a). Subparagraphs (b) and ( c) remain largely unchanged from RD/TN/RL/184.” FORCED LABOUR The chair has brought “forced labour”, a controversial issue allegedly pushed by the United States against China in the fisheries subsidies negotiations, under the notification and transparency requirements. The disciplines proposed under notification and transparency are as follows: “C.1 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 this Article. C.2 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; and (iii) to the extent possible, the full text of the agreements or arrangements. A Member may meet this obligation by providing an up-to-date electronic link to the Member’s or other appropriate official web page that sets out this information. C.3 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 to fishing and fishing related activities that are not specific within the meaning of Article 2 of the SCM Agreement. C.4 Not later than 90 days from the entry into force of these disciplines, each Member shall notify to the Committee on Fisheries Subsidies all information that is necessary for the determination of its annual aggregate level of fisheries subsidies. Thereafter, each Member shall submit this information to the Committee on Fisheries Subsidies in its regular notifications of fisheries subsidies under Article 25 of the SCM Agreement, Article 8 of the Agreement on Fisheries [Subsidies], and this Article. Each Member shall submit this information through a template the content and form of which shall be previously agreed by Members.” Finally, India’s demand for disciplines on non-specific fuel subsidies has been put in a placeholder, which implies that it remains an open issue. In conclusion, it remains to be seen how the chair’s latest draft text will be treated in the intense week of negotiations in January. +
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