WORLD TRADE  
ORGANIZATION  TN/RL/GEN/150 
2 July 2007 
 (07-2782) 
Negotiating Group on Rules Original:   English 
  
FISHERIES SUBSIDIES:  PROPOSED NEW DISCIPLINES 
 
Proposal from the Republic of Indonesia
 
   The following communication, dated 29 June 2007,  is being circulated at the request of the 
Delegation of the Republic of Indonesia. 
 
_______________ 
 
 Introduction 
 
1. Indonesia has noted the broad range of views expr essed by Members in this group on many of 
the issues involved in this negotiation.  The United States (TN/RL/GEN/145), New Zealand (TN/RL/GEN/100 and TN/RL/GEN/141) and Brazil (TN/ RL/GEN/79/Rev.3) have  offered legal text 
for framework proposals based on a broad prohibition of subsidies that can contribute to overcapacity 
and overfishing.  Alternative proposal s from Japan, Korea and Chinese Taipei 
(TN/RL/GEN/114/Rev.1), the European Co mmunities (TN/RL/GEN/134) and Norway 
(TN/RL/GEN/144) have addressed a much narrower range  of subsidies, and much narrower concerns.  
In addition, work such as Argentina’s proposal fo r special and differential treatment for developing 
countries (TN/RL/GEN/138/Rev.1) has been helpful, as have other contributions.  We note that much 
of the technical work in the Group over the last year, including the identification of appropriate 
exceptions and the discussions of Argentina's proposal s, has been premised on a broad prohibition as 
the backbone of new disciplines, which we support.   
2. This statement follows on our remarks in th e May and June meetings, and introduces a draft 
text that we hope will serve as the basis of discussi on for issues critical to Indonesia as a developing 
country, and critical to this negotiation.   
3. The text articulates a proposed resolution of some  of the issues with which we in the Rules 
Committee have been struggling, and also lays out a new framework for the work of the Committee in 
several important areas. Namely:   
• It requires technical assistance to developing co untries in several areas important to their 
participation in this effort to discipline subsidies that contribute to overfishing and 
overcapacity.  This includes assistance to de velop the capacity to initiate, implement and 
enforce compliance with fishery management plans, full membership in regional fishery 
management organizations (RFMO’s) adjacent to  their exclusive economic zones, assistance 
to develop and maintain an enquiry point, a nd flexibility in terms of responding to requests 
for sophisticated fisheries management data.  It also includes longer transition periods to 
implement the agreement;   
 
• It defines artisanal fishing and small scale fish ing in ways that allow for control of their 
capacity to access fishery resources and to u tilize the flexibility to which they should be 
entitled;   TN/RL/GEN/150 
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  • It specifically allows for enhanced ability to prot ect marine resources in archipelagic waters;   
 
• It lays the basis for a new interpretation of  Article 5 and Part V of the Agreement on 
Subsidies and Countervailing Measures for advers e effects to a Member’s fishery resources, 
and also clarifying that both the multilateral a nd domestic tracks should be available for this 
purpose;  and  
 
• It provides that those parts of this agreemen t requiring assessment of issues related to the 
status of fishery and biological resource s will be addressed by fishery experts.   
  Each of these five areas are summarized below.    
Explanation of the Proposal 
 
4. Technical Assistance.   Many delegations have spoken to the need for technical assistance to 
developing countries in the context of this negotiatio n.  Indonesia would like to point to two areas in 
which developing countries have specific needs, both of which relate to the content of this agreement.  
The first is for assistance for fisheries manageme nt.  In several areas of the agreement we have 
proposed that subsidies be allowed contingent on a showing that they are not harming the resource.  
However, many developing countries cannot do th is unless they have the capacity to initiate, 
implement and enforce compliance with a fishery management plan.  We have previously observed in this Committee that attention paid to subsidies in the fisheries sector without recourse to stock 
assessment has the potential to lead to overexpl oitation of fisheries resources and subsequent 
distortion of the sector.  We therefore propose that on the request of a developing country Member, 
developed countries shall provide technical assistan ce to develop the capacity to initiate, implement 
and enforce compliance with a fishery management plan adequate to participate fully in this 
agreement.   
5. We likewise propose that developed countries sh all provide assistance to developing country 
members so requesting it to participate fully in regi onal fishery management organizations adjacent to 
their exclusive economic zones.  For developing countries that may have only a handful of vessels 
capable of fishing in such waters, full participa tion in RFMO’s is costly and often unlikely to be 
funded.  This sometimes means that such vessels must either take the risk of fishing illegally or cease 
fishing altogether.  We feel that there should be no such barrier to full developing country 
participation in RFMO’s.  Full pa rticipation by developing countries, including in RFMO scientific 
and research program activities, can only help to  address the overcapacity and overfishing that now 
characterize many of the world’s fisheries.   
6. Artisanal and Small-Scale Fishing.  Indonesia has carefully considered attributes of both 
kinds of fisheries and has concluded that both sh ould receive special and differential treatment.  
Artisanal fishing is primarily subsistence fish ing and assistance should be allowed subject to 
conditions, which we have noted rela te to their being close to shore, and certain specified engine-size 
to tonnage ratios, primarily operated by individua ls or families.  Small scale is defined as operating 
within 12 nautical miles, and below 20 meters.  However, since small-scale fisheries can have considerable effects on resources, they should be narrowly and objectively defined and subsidies to 
them made contingent on a showing that they are not harming the resources of a Member’s own 
fisheries management plan, the resources of another Member or the resources governed by an RFMO.  
As noted, developing countries may need help to ma ke this kind of showing,  and should be able to 
request assistance from developed countries for this .  These exceptions for small scale fishing and 
fishing in a developing country’s own EEZ are ava ilable to developing countries contingent on a 
showing that there is no present or likely fu ture effect on the fishery resource.    TN/RL/GEN/150 
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  7. Archipelagic Waters.   As previously noted, Indonesia is an archipelago of over 
17,000 islands.  As such, its fisheries share w ith other archipelagic states unique features of 
seasonality, species heterogeneity and species interac tions that make it especially problematic to 
manage.  Indonesia has therefore proposed, not to ex empt archipelagic waters from this agreement 
because we believe subsidies disciplines should apply there, but rather to exempt from the prohibition 
measures to conserve and protect the archipelagic marine environment, and to protect and develop 
archipelagic waters as a unit.   
8. Adverse Effect to Fishery Reso urces/Clarification of Multilateral and Domestic Tracks.   
Building on proposals made by the United States a nd Brazil, Indonesia proposes that an additional 
measure of harm to a domestic industry be adde d, as an "adverse effect on fishery resources" to 
Article 5 and Part 5 of the ASCM.  It also proposes to clarify that both the multilateral and domestic 
tracks should be available to address fisheries subsid ies.  This would in effect allow countries to 
investigate, and if warranted impose, counter vailing duties on the fishery products of Members 
causing an adverse effect upon the domestic industry in part because of harm to the fishery resource.  Indonesia has also retained the language proposed by the United States on "serious prejudice" to 
ensure that the multilateral track is also available under this Annex.  
9. Fishery Expertise.   Finally, in order to ensure that decisions on fishery resource issues are 
made by individuals with the requisite expertise, Indonesia proposes that fisheries experts be 
explicitly engaged on matters aris ing under this agreement.  Indon esia proposes that decisions on 
showings of compliance with exceptions to the general prohibition, and in particular, a request by a member to examine whether there is an adverse eff ect in the case of a particular subsidy notification, 
be made by a subcommittee of the SCM Committ ee that includes fishery experts from member 
governments and those identified by relevant intern ational organizations.  Fisheries experts would 
also be required in domestic injury proceedings in volving adverse effects to a fishery resource.   
10. There are many other elements of this text  that will warrant discussion, and we have 
identified here only those major areas where the text breaks new ground.  While we have provided 
explicit text, we are interested in exploring th e precise wording to captu re agreement on these 
concepts.   TN/RL/GEN/150 
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  Attachment 
 
ANNEX [VIII] TO THE AGREEMENT ON SUBSIDIES AND COUNTERVAILING 
MEASURES 
 
Preamble 
Members, Recalling  the commitment at Doha to clarify and im prove WTO disciplines on fishery subsidies.   
Noting  the current state of world fishery stocks and the desire of Members to address subsidies that 
have a harmful effect on them;   
Conscious  of the negative effects of overcapacity and overfishing on these fisheries resources;   
Reaffirming  that provisions for special and differential (S&D) treatment are an integral part of the 
WTO Agreements;   
Determined  to strengthen ASCM provisions with a view to making them more precise, effective and 
operational in relation to fisheries;   
Considering  the social and economic importance of the fisheries sector to developing country 
Members;   
Hereby agree  as follows:   
Article 1 
Definitions and coverage 
1.1 This Annex provides for specific provisions regardin g fisheries subsidies and it is an integral 
part of the Agreement on Subsidies and Countervailing Measures (ASCM).   
1.2 A subsidy as used in this Annex is a subsidy with in the meaning of paragraph 1 of Article 1 of 
the Agreement on Subsidies and Countervailing M easures (ASCM).  A subsidy subject to this 
Annex must be specific, pursuant to Article 2 of the ASCM.   
1.3 This Annex shall not apply to inland fisheries
1 or to aquaculture.2   
1.4 This Annex covers any subsidy that confers a be nefit to or on behalf of any company and/or 
person linked in fact or in law, directly or indirectly3, to enterprises engaged in the harvesting 
of marine wild capture fisheries.  Fisheries subsidies shall encompass any subsidy programme 
and/or the disbursement made under such programme.   
                                                      
1 "Inland fisheries" are fisheries which are carried  out in freshwater or estuaries of a Member and 
whose target species are those that spen d all of their life-cycle therein.   
2 "Aquaculture" is the farming of aquatic organism s, including fish, mollusc s and crustaceans, provided 
that no capture fisheries is used to feed raised fish or is farmed.   
3 The term "directly or indirectly" is used in this Annex in the same sense as it is used in paragraph 1 of 
Article XVI of GATT 1994.    TN/RL/GEN/150 
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  1.5 Harvesting includes the on-vessel processing of fi sh and transport of fish from one vessel to 
another or from a vessel to shore, but it do es not include inland or on-shore processing or 
other post-harvest handling or activity.   
1.6 This Annex does not cover government-to-gove rnment payments to obtain access for a 
Member’s distant water fishing fleet to fish eries resources within the territorial sea or 
exclusive economic zone of a developing country , or to quotas or other rights established by 
any regional fishery management organization (R FMO) or arrangement.  The further transfer 
of such rights to the Member’s fishing fleet is  covered by this Anne x but is not prohibited 
under Article 2, provided that a benefit is not c onferred by the onward transfer of such rights 
to the Member’s fishing fleet, in that:   
(a) The Member’s fleet pays compensation comp arable to the value of the access of the 
resource;   
(b) The access arrangements provide for compliance with applicable fishery management 
plans and for a science-based assessment and monitoring of the status of the fishery 
resources covered by the access arrangements;  and 
(c) Such payments are notified pursuant to Article 5 herein.   
Article 2 
Prohibition 
A Member shall neither grant nor maintain any fish ery subsidy, except as otherwise provided in this 
Annex.   
Article 3 
Exceptions to the Prohibition 
3.1 Nothing in Article 2 of this Annex shall prevent government assistance for:   
(a) Provision of a social safety net for fisher men, including early retirement schemes, re-
education, training or alternative employment assistance, unemployment relief, life 
insurance, support for the temporary suspension of fishing activities.   
(b) Fisheries research, including data collection, surveys, data analysis, and stock 
monitoring, sampling and assessment;4   
(c) Fisheries stock enhancement, including ma rine conservation and protection, marine 
environment restoration, protection and development of a Member’s own 
archipelagic waters5, artificial reefs, hatcheries for breeding and by-catch mitigation 
devices;6 
(d) Improving vessel and crew safety7, provided that the improvement is undertaken to 
comply with international or domestic standards;  and there is no increase in fishing 
                                                      
4 This is limited to fisheries research that does not result in commercial sale of  the fish harvested.   
5 Archipelago is as defined in Article 46 of UNCLOS 1982, and calculati on of the archipelagic 
baselines is defined in Article 47 thereof.   
6 This provision is aimed at measures that enhance marine resources rather than capacity to harvest 
those resources.   
7 Programmes or activities aimed primarily at vessel m odernisation or repair do not fall within this sub-
paragraph.  The construction of vessels is not permitted under this sub-paragraph.   TN/RL/GEN/150 
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  capacity
8, such as the volume of fish hold or en gine power of a vessel subject to such 
program.   
(e) Construction and maintenance of general infr astructure for fishing activities, such as 
wharves and fishing ports and related fac ilities, roadways, water and sanitary waste 
systems, the provision of housing  and other forms of community development 
infrastructure.9   
(f) Short-term emergency relief, recovery adjustment programs and replacement of 
fishing capacity following natural or envir onmental disasters, provided that fishing 
fleet capacity is not restored beyond its pre-disaster state10, except that special 
flexibility shall be given to developing  countries pursuant to Article 4.   
(g) Assistance and user-specific allocations to individuals and groups under limited 
access privileges and other exclusive quota pr ograms, and other expenses related to 
administration and operation of fishery ma nagement programs, including allocation 
and monitoring of licences, permits, quotas, vessel numbers and catch returns.   
(h) Vessel decommissioning programmes, provided that the:   
(i) vessels subject to such programmes are scrapped or otherwise permanently 
and effectively prevented from being  used for fishing anywhere in the 
world;11   
(ii) fish harvesting rights associated with su ch vessels, whether they are permits, 
licenses, fish quotas or any other form of harvesting rights, are permanently 
revoked and may not be reassigned;  and 
(iii) owners of such vessels, and the holders  of such fish harvesting rights, are 
required to relinquish any claim associated with such vessels and harvesting 
rights that could qualify such owners and holders for any present or future 
harvesting rights in such fisheries; 
(iv) there are in place fisheries management  plan designed to prevent over-fishing 
in the targeted fishery, such as lim ited entry systems, catch quotas, limits on 
fishing effort or allocation of exclus ive quotas to vessels, individuals and/or 
groups, provided that special flexib ility should be given to developing 
countries, including any technical assistance requested  by any such 
developing country as provided in Article 4 below.   
                                                      
8 Fishing capacity is understood here to mean the ability  of a vessel or fleet of vessels to catch fish.   
9 General infrastructure for fishing communities shall also not be considered to be regionally specific 
under the ASCM.   
10 Restoration to pre-disaster state is not intended to restore a pre-disaster state of over-capacity.   
11 Vessels decommissioned for legitimate research and training purposes, with no commercial 
functions, need not comply with the conditions of this exception.    TN/RL/GEN/150 
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  Article 4 
Special and Differential Treatment of Developing Country Members 
4.1 Notwithstanding the provisions of Articles 2 a nd 3, a developing country Member shall be 
allowed to grant or maintain fisheries s ubsidies to its artisanal fisheries activities12, defined 
herein as those which:   
(a) Operate within its territorial waters and mostly close to shore;   
(b) Use vessels of [proportional ratio between  gross tonnage and engine power] and 
which utilize primarily manual gear;  and 
(c) Are operated by individual fishermen or family members for the purpose of 
subsistence or local trade.   
4.2 Notwithstanding the provisions of Articles 2 a nd 3, a developing country Member shall be 
allowed to grant or maintain subsidies to its small-scale fisheries for the purpose of fishing 
vessel construction, repair, or modernization, or  gear acquisition or improvement, or fuel.  For 
the purposes of this section, small-scale fish eries shall be defined as those that:   
(a) Are below 20 meters dimension;  and 
(b) Operate within the Member’s 12 nautical mile limit or the Member’s own 
archipelagic waters.   
4.3 Notwithstanding the provisions of Articles 2 a nd 3, a developing country Member shall be 
allowed to grant or maintain subsidies for the purpose of fishing vessel construction, repair, or 
modernization, or gear acquisition or improveme nt, or fuel, provided that the purpose is to 
exploit: 
(a) Fisheries in the Member’s own Exclusive Economic Zone;  or 
(b) Rights held by the Member in high seas fishing quotas or any other rights established 
by a regional fisheries management orga nization (RFMO) or a regional fisheries 
management arrangement.   
4.4  Upon the request of developing country Memb ers, developed country Members shall provide 
technical assistance to developing country Member s to allow them to participate fully in any 
RFMO adjacent to their exclusive econom ic zone or archipelagic waters.   
4. 5  Fishing subsidies under part 4.2 shall be  allowed contingent on a showing that:   
(a) The Member has a fishery management plan  in place that is effectively monitored and 
adequately enforced;   
(b) The fishery does not adversely affect re sources governed by the fishery management 
plan;   
(c) The small-scale fishing activities will not adversely affect fishery resources of other 
Members or the resources governed by relevant RFMO’s;  and 
                                                      
12 Artisanal fisheries activities shall include on-board handling (including but not limited to provision 
of cool boxes, fish holds and other measures to enco urage hygiene and sanitation and to preserve fish quality) 
and post-harvest handling.   TN/RL/GEN/150 
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  (d) Determinations of adverse effects on fishery resources will be made by fisheries 
experts convened by the Committee pursuant to  procedures under Sections 5 and 6.   
4.6 Fishing subsidies under part 4.3 shall be allo wed contingent on a showing that the developing 
country Member has:   
(a) Underexploited resources in its EEZ;  or 
(b) A right to high seas fishing quotas or extra quota in a RFMO.   
4.7. Upon the request of developing country Member s, developed country Members shall provide 
technical assistance to developing country Members to develop the capacity to initiate, 
implement and enforce compliance with a fisher y management plan adequate to provide the 
showing required by Sections 4.3, 4.4 and 4.5 herein.   
Article 5 
Notifications and Enquiry Points 
5.1 A Member asserting that a subsidy covered by  this Annex qualifies for an exception pursuant 
to Sections 3 and 4, with the exception of artisan al fisheries under Section 4.1, shall include in 
its annual notification, mutatis mutandis,  under Article 25 of the ASCM, information fully 
describing the fisheries benefiting from the subs idy and describing how the subsidy conforms 
to the conditions set forth in the exception.   Information shall include, where relevant, 
measures to address fishing capacity and effort, and the biological status of managed stocks.   
5.2 The Committee on the ASCM will annually review such notifications and report to Members 
on the extent to which Members are availing themselves of such exceptions.  The Committee 
may appoint a special subcommittee includi ng fishery experts drawn from Member 
governments and those individuals recommended by relevant multilateral institutions with 
fisheries expertise for this purpose.   
5.3 Upon the request of any Member, the Committe e shall convene a subcommittee composed 
pursuant to Section 5.2 to review a particular notification and report to the Committee its 
findings on whether the subsidy or subsidies of a Member conforms to the conditions of the 
exception claimed, including whether the subsidy adversely affects the fishery resources of a 
Member.  The subcommittee’s report shall indicate whether:   
(a) The Member claiming the exception has a national fisheries management plan in 
place, which includes, inter alia :  conservation and mana gement measures based on 
the best scientific evidence available;  fisheries management control measures 
(fisheries monitoring, surveillance, c ontrol and enforcement mechanisms);  
mechanisms established to identify and quan tify fishing capacity;  vessel registration 
and licensing system;  limited entry systems, catch quotas, limits on fishing effort or allocation of exclusive quotas to vessels;  a nd timely and reliable statistics available 
on catch and fishing effort in sufficient detail to allow sound statistical analysis;  and 
(b) The volume of the total catch by a Member of target species and the number of 
vessels used in those fishing operations are decreasing, as compared to the total catch 
volume and number of vessels it had during the previous year, and  
(c) Whether the subsidy claimed is causing or lik ely to cause adverse effect to the fishery 
resources of a Member or fishery resources governed by a relevant RFMO or other 
arrangement.    TN/RL/GEN/150 
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  5.4 Each Member shall maintain an enquiry point to answer all reasonable enquiries from other 
Members and interested parties in other Members concerning its fisheries management plan, 
including measures in place to address fishing cap acity and fishing effort and the biological 
status of managed stocks.  Special flexibilit y shall be given to developing countries with 
respect to instituting enquiry points, including flex ibility to develop such enquiry points with 
the help of technical assistance.  Upon the requ est of developing country Members, developed 
country Members shall provide technical assist ance to develop the capacity to initiate and 
implement compliance with this Section.   
Article 6 
Serious Prejudice and Adverse Effects Notification 
6.1 Serious prejudice in the case of a fishery subsid y covered by this Annex shall be presumed to 
arise under Article 6.3 of the ASCM when:   
(a) There is an increase in the subsidizing Memb er’s capacity to produce the product due 
to the subsidy;  or 
(b) An increase in the subsidizing Member’s relative share of production of the like 
product, as compared to non-subsidized production, over a representative period 
sufficient to demonstrate clear trends in production.   
6.2 An adverse effect to the domestic industry sha ll be presumed to arise under Article 5 of the 
ASCM and Part V of the ASCM when there has been found an adverse effect to the fishery 
resources of a Member.  Other than a count ervailing duty investigation under Part V, a 
finding of adverse effect to the fishery resources of a Member shall be determined by a panel 
including fisheries experts, drawn from Member governments and those individuals 
recommended by relevant multilateral institutions.  In an investigation under Part V, the 
investigating authorities shall include fisheries experts in their inves tigative process.  They 
may base their finding of injury to the domestic injury either as defined in Article 6.3 below 
in terms of fisheries adverse effects, or accordi ng to the regular material injury standard for a 
countervailing duty investigation, or both.   
6.3 A panel’s or investigating authority’s de termination of fisheries adverse effect13 shall be 
based on information including:   
(a) The total catch (in volume terms) by the Memb er of target species and by-catch, with 
breakdown by fishery, and the number of vessels used in those catching operations, 
with breakdown by operated location areas;   
(b) The criteria and scientific information used to set the status of the fishery;   
(c) Whether the fishery in question is unde r management of a regional fisheries 
management organization or arrangement a nd which are the nature of the monitoring 
and the quantitative limits applicable to the Member;   
(d) National fisheries management plans in place,  with sufficient information to enable 
Members to evaluate and to understa nd their framework and operation;  and 
                                                      
13 Nothing in the concept of fisheries adverse effects shall prejudice the ability of a panel or 
investigating authority to find adverse effects as othe rwise defined in Article 5 of the ASCM.  A fisheries 
adverse effect is an alternative additional mean s of meeting the adverse effects standard.   TN/RL/GEN/150 
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  (e) Government-to-government payment for access by foreign vessels to fishing 
resources of a developing country’s maritime  jurisdiction or to quotas or any other 
rights established by any regional fishery management organization or arrangement 
("access rights"), with breakdown by recipient country, total amounts paid, amounts received on the onward transfer of the access rights, fisheries data (in accordance with items (a) and (b) of this paragra ph) and other relevant information.   
(f) Information on the biological status of relevant marine ecosystems.   
Article 7 
Prevention of circumvention 
 Members shall not have recourse to rules of or igin (preferential or non-preferential), the flag 
of a vessel and access rights, among others, as  a means to undermine the objectives set out in 
the preamble and to circumvent thei r obligations under this Annex.   
Article 8 
Review 
 The provisions of this Annex shall be re viewed by the Committee after a period of 
8 (eight) years from the date of its entry into force, with a view to determining whether any 
modification is necessary.   
Article 9 
Transitional provisions 
9.1 Any fisheries subsidy which has been establishe d within the territory of a Member before the 
date of the entry into force of this Annex sh all be notified to the Committee in no later than 
90 days after that date.   
9.2 From the entry into force of this Annex, th ere shall be a period of three years for developed 
country Members and a period of five years for developing country Members to gradually 
phase out and eliminate fisheries subsidies that ar e inconsistent with the provisions of this 
Annex.  The starting point of the reduction shall be the 2003-2005 average of the fisheries subsidies prohibited under Article 2.  Members shall not be allowed to adopt new prohibited 
fisheries subsidies or to extend the scope of  any existing prohibited fisheries subsidy.   
9.3 Any least-developed country Member shall phase out its fisheries subsidies within an eight-
year period, preferably in a progressive manner,  from the date of entry into force of this 
Annex.  If such least-developed country Member deems it necessary to apply such subsidies 
beyond the 8-year period, it shall not later than one year before the expiry of this period enter 
into consultation with the Committee, which w ill determine whether an extension of this 
period is justified, after examining all the relevant economic, fina ncial and development 
needs of the Member in question.  If the Committe e determines that the extension is justified, 
the Member concerned shall hold annual consu ltations with the Committee to determine the 
necessity of maintaining the subsidies.  If no su ch determination is made by the Committee, 
the least-developed country Member shall phase out those fisheries subsidies within 
3 (three) years from the end of the last authorized period.   
 
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