WTO Negotiators Debate Scope, Application of Potential Fish Subsidies Deal

22 June 2017

Trade negotiators continued their work last week towards crafting new WTO disciplines on fisheries subsidies, examining two proposals and looking at options regarding the use of dispute settlement rules and notification obligations in a future deal.

The meetings, held at the WTO’s Geneva headquarters from 14-16 June, were the latest in a series of multi-day gatherings meant to address both new or updated proposals, as well as examining specific issues in depth.

Negotiators are working to clinch a deal in time for the WTO’s Eleventh Ministerial Conference (MC11) in the Argentina capital city of Buenos Aires, slated for 10-13 December. Adding political momentum to this effort is the non-binding commitment under the UN’s Sustainable Development Goal (SDG) 14 to conclude an agreement by 2020. That pledge was reaffirmed earlier this month during the UN Ocean Conference in New York. (See Bridges Weekly, 15 June 2017)

Proposals in review

Among the proposals under scrutiny last week was a new communication from Indonesia, as well as a communication from a group that included Argentina, Colombia, Costa Rica, Panama, Peru, and Uruguay.

The Indonesian proposal tackles two main areas: prohibitions, along with special and differential treatment (S&DT), which has long been a thorny topic in these negotiations. The country makes note that the topic of fisheries subsidies has particular relevance for its national context, spurring its interest in negotiating rules in this area.

“Indonesia is an archipelagic state with more than 70 percent of its territory covered in water and heavily dependent on its extensive coastal regions and oceans for the livelihood of its people. Hence, it is important for Indonesia to convey its position regarding fisheries subsidies,” the proposal says.

The document notes later the economic challenges that its country’s artisanal fisheries face as a result of IUU fishing, for example, which it argues have turned people away from participating in the sector.

Furthermore, the southeast Asian nation argues that any future fisheries subsidies deal must “take into account the lives of the artisanal, traditional, and small-scale fisheries, particularly in developing countries and [least developed countries].”

The communication then includes a series of proposed articles, outlining how a fisheries subsidy should be defined in this context; which fisheries subsidies should be included in new disciplines; and special and differential treatment.

On special and differential treatment, Indonesia argues that developing countries must be able to provide subsidies to support artisanal fishing as well as subsidies for vessel construction and some operating costs for small-scale fisheries, along with providing a definition for what qualifies as a small-scale fishery. In the case of small-scale fisheries’ support, conditions would be attached to this state aid, such as the development of an enforceable fishery management plan, among others.

Trade sources told Bridges that the proposal drew requests for additional clarity on certain areas, such as on the scope of certain proposed flexibilities, as well as questions regarding the final provision on developed country members providing poorer countries with technical assistance upon request.

The proposal from the Latin American country group takes a different focus, putting forward disciplines banning the use of subsidies related to IUU fishing; overcapacity and overfishing; while clarifying that the disciplines, except for those related to IUU fishing, should not hinder smaller-scale fishers’ abilities in certain areas, such as engaging in markets.

It also outlines notification requirements on a host of aspects of fisheries subsidies, ranging from the types and levels of subsidies being provided to fish catch data and conservation measures for fish stocks.

The final two sections refer to systems for providing developing and least developed country members with technical assistance and capacity building, along with a “review clause” to assess annually the implementation of the new rules and what can be done to support them.

At last week’s meeting, various members reportedly raised questions regarding various different aspects of this proposal, such as whether the notification requirements would be overly difficult for some countries to meet, or whether some of the subsidy disciplines had overly broad exemptions that could be improved by clearer definitions and criteria.

Both Indonesia and the Latin American country group are reportedly planning to update their respective proposals based on members’ feedback, according to sources familiar with last week’s meetings. Other proposals that have been discussed in prior meetings include those tabled by the European Union, as well as by New Zealand, Iceland, and Pakistan. Concept papers were previously put forward by the Least Developed Country (LDC) and the African, Caribbean, and Pacific (ACP) Groups, respectively. (See Bridges Weekly, 24 May 2017)

Trade sources confirm that the EU is preparing an updated proposal. The ACP Group is also preparing to submit draft text for consideration, sources say, and circulated this week an updated concept paper. Norway is said to be preparing draft text as well, telling the WTO’s Committee on Trade and Environment on Tuesday that this will be circulated shortly.

Dispute settlement, standstill, transparency

Negotiators also met on Friday 16 June to tackle a series of specific issues, such as how and whether to make a future fish subsidies deal subject to the WTO’s dispute settlement rules; what sort of reporting commitments there should be and how to address concerns over the burden that transparency requirements might place on poorer members; and whether to include a “standstill” provision that would commit members not to put in place new subsidies.

Sources says that these discussions drew questions on various fronts, such as what is meant by transparency obligations and whether developing and least developed countries can meet them, along with whether putting in place a “standstill provision” could risk limiting “policy space” for poorer countries that are working to gain a foothold in the fisheries sector, and whether it would even be necessary if strong subsidy disciplines are put in place.

On whether and how to subject a new fish deal to the WTO’s dispute settlement system, various members reportedly called for an enforceable and legally binding deal, while some suggested that the negotiations need to be further advanced before getting into this subject in greater depth.

However, some questions have been raised in this context over the use of environmental definitions developed elsewhere and what this means for the dispute settlement process. Least developed countries have also indicated that they would need special and differential treatment in this area.

What form a future deal could take within the WTO framework also remains unclear, one source said, while noting that this institutional question will likely become clearer once the disciplines have been further developed.

Negotiators are slated to meet on multiple occasions next month in a bid to advance the talks further before the WTO’s August recess.

Sources familiar with the talks say that members are aiming to have all proposals on the table by then, and potentially have some form of “compilation” document that consolidates the materials and topics discussed so far, in order to facilitate the next stage of talks when these resume in the autumn.

ICTSD reporting.

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