Bridges Trade BioRes • Volume 6 • Number 22 • 15th December 2006

WTO FISH SUBSIDIES TALKS FOCUS ON ROLE OF FAO


WTO FISH SUBSIDIES TALKS FOCUS ON ROLE OF FAO

After several months of suspension following the collapse of the trade talks in July, countries on 12 December restarted discussions on how to discipline fisheries subsidies in the WTO, albeit in informal mode. The largely technical debate focused on the possible role of external input, notably from the UN Food and Agriculture Organisation (FAO), in developing and implementing the rules.

In this context, Members picked up several issues that had been raised in different proposals, in particular those related to special & differential treatment (S&DT) where countries have suggested drawing on FAO data and guidelines to ensure that subsidised fishing under S&DT remains within sustainable limits.

Fisheries management and the FAO Code of Conduct

Some Members have suggested allowing developing countries to provide certain subsidies, including those that enhance the capacity of fishing fleets, on the condition that a fisheries management scheme has been put in place, raising the question how ensure not just the existence but also the effectiveness of such schemes.

Brazil, for instance, in earlier proposals had suggested using membership in regional fisheries management organisations (RFMOs) as a condition, but had subsequently dropped the idea in response to widespread scepticism regarding the coverage and capacities of RFMOs (see Bridges Trade BioRes, 3 April 2006, http://www.ictsd.org/biores/06-04-03/inbrief.htm#1).

In its June proposal, Argentina had suggested that countries wishing to provide subsidies under S&DT should be required to implement national management systems "in keeping with" the FAO Code of Conduct for Responsible Fisheries (see Bridges Trade BioRes, 30 June 2006, http://www.ictsd.org/biores/06-06-30/story1.htm).

At the recent meeting, some Members raised concerns that such a direct cross-reference to the Code could effectively turn a voluntary instrument into a mandatory requirement. Moreover, should a dispute arise, it could be left to the WTO to determine whether the Code had been complied with, which Members agree would clearly exceed the competence and mandate of the trade body.

Argentina clarified that the Code should simply be seen as a standard — similar to those already referred to in the agreements on the Application of Sanitary and Phytosanitary Measures (SPS) and on Technical Barriers to Trade (TBT) — which Members were free, but not obliged to follow.

Others pointed out that only some of the Code’s provisions actually dealt with management-related issues. Thus, rather than referring to the Code, they suggested identifying the relevant elements and integrating them directly into the WTO disciplines.

Assessing stock levels

Another key issue in the discussion related to the availability and reliability of data to assess stock levels which would be necessary to show that levels were sufficiently high to allow developing countries to expand their capacity under the S&DT provisions.

Brazil, for instance, had proposed allowing the provision of capacity-enhancing subsidies only for those fisheries that are not ‘patently at risk’, i.e. that are not judged ‘overexploited’, ‘depleted’ or ‘recovering’ by the FAO. Argentina had suggested that such subsidies should only be permitted for the fishing of "surplus species", defined as species where the catch capacities of the fishing fleet were below the maximum allowable catch (based on national data).

Some Members raised concerns over the feasibility of assessing stock levels with sufficient accuracy. The EU in particular noted that international data was too unreliable to make such judgements. Moreover, since the FAO draws extensively on data supplied by individual countries, some Members feared that strong reliance on the FAO could result in a negative feedback effect by providing a disincentive for Members to submit their data. Relying entirely on national data, on the other, would effectively mean that Members would police themselves.

As a compromise, the possibility of using both international and national data was raised. For instance, capacity-enhancing subsidies would not be allowed for any fishery judged depleted and overexploited by the FAO. For the remaining fisheries — which would only amount to a few given that three quarters of global fish stocks are already at risk — countries would calculate their surplus themselves, which in the case of a dispute could be cross-checked with international data.

Regarding Argentina’s proposal to determine surplus "in accordance with" Articles 61 and 26 of the UN Convention on the Law of the Sea (UNCLOS), Members raised general questions about possible implications of referring to other treaties which could put the onus on a dispute panel to examine compliance with these treaties.

De minimis proposal again under attack

While most of the discussion at the meeting was of a technical nature, the majority of Members came out strongly against the ‘de minimis’ proposal out forward by Japan, Korea and Taiwan. These countries had suggested applying S&DT only to those developing countries that account for less than a minimum percentage of the world market share of fish, or which have catches that fall below a certain weight threshold. Most Members felt that such an approach was too static and did not adequately respond to the environmental and developmental objectives of the negotiations.

No additional informal or regular meetings of the Rules Group have so far been scheduled.

Additional resources

To access WTO submissions on fisheries subsidies, visit http://www.trade-environment.org/page/theme/tewto/para28.htm.

ICTSD reporting.