WORLD TRADE
ORGANIZATIONTN/RL/W/69
18 March 2003
(03-1578)
Negotiating Group on Rules Original:  English
KOREA’S VIEWS ON THE SUGGESTED CATEGORIZATION
OF FISHERY SUBSIDIES
The following communication, dated 17 March 2003, has been received from the Permanent
Mission of Korea.
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INTRODUCTION
1. In the February session of the rules negotiation, a group of Members made a submission on
the possible categorization of fishery subsidies1.  The submission shows in summary form the
categorization of fishery subsidies that various organizations have developed so far for certainpurposes pursued by those organizations.
2. The submission, other than presenting the various different types of categorization, seems to
suggest that the rules group should embark on its own categorization of fishery subsidies.
3. In the rules group negotiation on fishery subsidy issues during the year 2002, Korea
consistently stated that the rules group should not base its discussions on unproven assumptions and
prejudgements.
2  This should guide any discussion on fishery subsidies in view of the wide-ranging
and deep impact that the WTO rules have on international trade.
4. With respect to the February submission by a group of Members, Korea is of the view that
there are important preliminary questions that have not been sufficiently addressed in the submission.
Korea wishes to raise some of those preliminary questions in the following pages.
WHY FOR THE CATEGORIZATION OF FISHERY SUBSIDIES
5. The submission asserts in several different places that the categorization of fishery subsidies
is necessary.  It begins with an assertion that some sort of breakdown of subsidy programmes by type
is to be needed.3  In the conclusion part, the submission again asserts that “it is difficult to see how
specific proposals for clarification and improvement of fishery subsidies disciplines can simply
address “fishery subsidies” in an undifferentiated way.”4  The submission, however, does not provide
sufficient reasoning why such a categorization is necessary.
                                                     
1 TN/RL/W/58
2 TN/RL/W/17
3 TN/RL/W/58, p.1
4 Id. P.4TN/RL/W/69
Page 2
6. Specific proposals for clarification and improvement of subsidies disciplines are in fact being
made without categorization of subsidies.  Thus, a logical question is why it cannot be done only for
fishery subsidies.
7. In the rules negotiation of 2002, Korea stated that it was not convinced of the arguments that
the peculiarity of the fisheries subsidies and products justify the sectoral treatment of fisheries
subsidies.  In the same vein, the first preliminary question that should be sufficiently answered by the
group of Members is why it is difficult to address the subsidies disciplines without categorization only
for the fishery subsidies.
OBJECTIVE OF THE CATEGORIZATION
8. As the February submission by the group of Members admits, categorization is meaningful
only on the basis of the clearly identified objective for the categorization.5  In fact, the different types
of categorization, presented in the submission, were developed by different institutions to pursue
different objectives and purposes.
9. If the objective of categorization is to assess the trade effect of various subsidies, the SCM
Agreement already provides a scheme of categorization, which is the “traffic light” categories of
prohibited, actionable and non-actionable subsidies.  If the submission is proposing a categorization of
fishery subsidies according to a scheme different from the traffic light approach, the objective of such
a new categorization should be identified as a preliminary point.
FORUM FOR THE CATEGORIZATION
10. The submission, while asserting that categorization is necessary, does not suggest where such
a categorization should be conducted.  As the submission shows, categorization is already takingplace in various forums, with far longer and deeper  institutional experiences in the study of fishery
subsidy issues in comparison with the rules negotiation group.
11. In fact, the FAO held the 2
nd expert consultation on fishery subsidies in December, 2002.  In
the consultations, the experts discussed on a “draft guide for identifying, assessing and reporting on
subsidies in the fisheries sector”.  According to the guide, the first step would be the identification of
different categories of fisheries subsidies and their size.  The second step would be assessment on thechanges in the behaviour of recipients of the subsidies and their impact on trade and environment.
12. The Fisheries Committee of the OECD is to launch a comprehensive study on government
financial transfers in 2003 in the wake of the fisheries market liberalization project undertaken in
2000-2002.  An important element of the study would be the clarification and improvement of theexisting GFT(government financial transfers) classification system.  The OECD had found that the
classification system as previously used was insufficient to allow for adequate analysis.
6
13. These studies by the FAO and the Fisheries Committee of the OECD, institutions with well-
established expertise on fishery related issues, would enable the rules negotiation group to conductrules related discussions on the basis of scientifically and objectively identified facts, rather than
assumptions and prejudgements.
14. Therefore, if the group of Members present clear views on the necessity and the objective of
the categorization to the satisfaction of all Members of the rules negotiation, then the rules groupmight decide to look into the possibility of cooperating with those institutions.
                                                     
5 Id. P.5
6 AGR/FI(2003)4, f.2TN/RL/W/69
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15. In a submission7 made to the rules negotiation group, a group of Members stated that
“addressing the harmful effects of fish subsidies requires action in a number of different policy areas
and international forums”.  The submission went on to state the comparative advantage of such
institutions as, among others, FAO, OECD and WTO.
16. Korea agrees that the issue should be appr oached in a flexible manner, utilizing the
comparative advantages of the institutions involved.  When it comes to the categorization of fishery
subsidies, the FAO and the OECD would be better prepared for the task, because they have far longer
and deeper institutional experiences in the study of fishery subsidy issues in comparison with the rules
negotiation group.
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7 TN/RL/W/3, para 5