WORLD TRADE  
ORGANIZATION  TN/RL/GEN/144 
26 January 2007 
 (07-0367) 
Negotiating Group on Rules Original:   English 
  
FISHERIES SUBSIDIES 
 
Proposal by Norway
 
   The following communication, dated 24 January 2 007, is being circulated at the request of the 
Delegation of Norway. 
_______________ 
 
  Over the last two years the discussion has progressed from a more conceptual phase to a 
phase where it is more focused on convergence.  The discussion has become more specific but has 
been complicated by the fact that there are funda mental conceptual differences between a top-down 
and a bottom-up approach; although in practice – wh en necessary exceptions are being discussed – the 
differences may be smaller in reality.  Nevertheless , in terms of legal drafting and the problem of 
crafting workable definitions that are simple and operational, these conceptual problems pose difficult 
challenges.  
 
 With this submission, Norway attempts to do tw o things: firstly to put forward a proposal that 
we hope can bring the discussion substantially furthe r in terms of scope and ambition for a discipline 
on Fisheries Subsidies, and secondly to suggest a way in which such a discipline can be drafted so as 
to avoid some of the problems Members have pointed to during the discussions of previous proposals.  
 
 The text of Norway’s proposal is set out in the Annex to this paper.  Scope of the discipline
 
  Members have discussed this issue at length.  There is no consensus on a general prohibition 
against all forms of subsidies in the fisheries sect or.  No-one has attempted to define what the 
fisheries sector is, although many Members are of  the opinion that inland fisheries are outside the 
scope, that the aquaculture industry should be exem pted, that there is a di fference between inshore 
fisheries (subsistence, artisanal, small-scale, et c.) and fisheries on the high seas – where large-scale 
overcapacity is predominant and where the absence of national jurisdiction aggravates the problems 
and challenges of overfishing.  Furthermore, ther e is no consensus on other kinds of government 
support to the processing industry – mostly in the form of, inter alia , price support for fishery 
products and support to build ware houses and freezing facilities.   
 Developing countries
 
 
 Many small developing countries have been partic ularly troubled by the proposal to discipline 
government financing of access agreements.  This  mainly involves the acce ss of foreign fishing 
vessels along the coast of African states, in the Indian and Pacific Ocean, predominantly for tuna 
vessels, to the fishing grounds of small island states that rely heavily on this form of income.  We are not proposing to include access fees in the discip line; however we would be willing to consider 
suggestions that make it necessary for the fishing industry of developed Memb ers to reimburse their 
governments for the financing of such access agreements.  TN/RL/GEN/144 
Page 2  
 
   On S&D, the issues raised by a large number of  developing countries rela te to small-scale and 
artisanal fisheries as well as the general issue of "policy space".  These Members would like to have 
the option, although this might not be their current policy, of financing the build-up of fishing capacity.  Such build up might be justified in the case of under-utilised fish stocks.  The issue of 
"policy space" is also linked to the issue of th e possibility of taking measures, as appropriate, for 
development purposes.   
  On the other hand, a number of developing country Members have called for stricter 
disciplines on the use of fisheries subsidies in gene ral, as this is detrimenta l not only in relation to 
overcapacity and overfishing, but also because of the trade-distorting effects of subsidies in relation to 
access to markets, price undercutting by subsidised  products in important world markets, etc. 
  Furthermore, 50 per cent of world trade in fish  and fish products is generated by developing 
countries and seven of the world’s top ten fish prod ucers are developing countries.  It would render 
this exercise with little effect if developing countri es were granted full exemption from the discipline.  
 
Small-scale and artisanal fisheries
   
  Members have attempted to define this  activity.  India’s and Brazil’s proposals
1 are 
complicated and difficult to operationalize because they  involve a set of definitions (up to ten) of 
discretionary parameters.  This is implicitly recognised by the fact that the FAO has not been able to 
agree on a uniform definition of small-scale and artisanal fisheries. 
 Scope – revisited
 
  According to an empirical study, the major bulk of government transfers to the fisheries 
sector are made by developed countries.
2  OECD figures on transfers demonstrate that, on average, 
around 70 per cent of the transfers are used to finance either biological research and fisheries 
management systems or are measures financing infrastructure, such as harbours and fishing 
community installations.  These are all measures that  the majority of WTO Members agree should fall 
outside the scope of the new discipline.  
 According to the above-mentioned OECD st udy, the remaining 30 per cent of government 
transfers are largely subsidies for the building of  fishing vessels.  In our approach, the initial 
discipline on Fisheries Subsidies should concentrate on overcapacity and overfishing, i.e. on subsidies that build up or maintain fishing capacity in one way or another.  Thus we propose to focus on subsidies granted for the acquisition, building, main tenance, repair or up-grading of fishing vessels 
including any technical or electronic equipment onboard the vessel. 
  New rules in this area would thus, in real te rms, be both ambitious and have a real impact, 
provided that we can find effective disciplines that take into account the range of political constraints 
described above, mostly relating to small-scale fisher ies and considerations re lated to the development 
dimension. 
 
A discipline for fishing vessels
 
  A new discipline should therefore concentrate on th e fishing vessels.  The legal text that is 
being proposed by Norway takes this as its point of  departure.  In the proposal, a fishing vessel means 
                                                     
 
1 TN/RL/W/203 and TN/RL/GEN/79/Rev.3 
2 "Subsidies in the OECD Fisheries Sector: A Revi ew of Recent Analysis and Future Directions", Cox 
& Schmidt, OECD,  Dec. 2002  TN/RL/GEN/144 
 Page 3 
 
 
  any vessel intended for use for the purpose of comme rcial exploitation of fishing resources, including 
fish processing vessels and vessels engaged in transshipment.   Furthermore, we have made a distinction be tween large and medium-sized vessels on the one 
hand and small vessels on the other, assuming that most  "damage" is caused by the larger vessels.  
This is mostly a function of their range of operati on; they can move with high speed, and they have a 
large operational radius.     We have chosen to make this distinction applicable to all Members, particularly because it is 
very difficult to justify that there is a diffe rence in the "damage" caused by a large boat from a 
developing country Member compared with that from a developed country Member.  The distinction 
tries to extract the essence and at the same time avoid the pitfalls of complicated definitions, which in 
any case would be very discretionary.  Thus, we do not attempt to define artisanal fisheries, small-scale fisheries, subsistence fisheries, etc.  We si mply chose to define a small boat as a proxy for a 
difficult definition and at the same time accept that even if the definition is crude, it is nevertheless 
simple and workable.  Furthermore, the starting point that we have suggested is one of several options 
that could be used as a specific de minimis  level – for example a level that is based on a numerical 
value indicating the amount of support pe r vessel, per programme or per country. 
  We base the distinction between large and sm all vessels on one parameter – the length of the 
fishing vessel.  Even such a parameter is of course  not without complications in terms of definition 
and circumvention – but if any criterion is the same  worldwide – this will work for all Members.  A 
criterion relating to fishing capacity on the other ha nd would not work.  Members will probably not be 
able to agree on a uniform system that is accepta ble to all, because Members apply very different 
systems:  gross tonnage of vessel, volume of fishing hold, motor power of the engine, etc.  
 As a point of departure, we have chosen to  set the limit for making a distinction between 
small and larger vessels at 15 metres.  As we have previously stated, this limit of 15 metres applies to all Members, developing and developed alike.  Some  may say that this limit is arbitrary and to a 
certain degree it is.  However, in our empirical re search, we have found that this limit captures the 
various practices and realities in a wide range of different fisheries around the globe – namely small 
scale fisheries in one form or another. 
 
S & D provisions
 
  The implication of paragraph 2 of our proposal  is that developing countries may subsidise 
fishing vessels up to 20 metres in length, provided that they fulfil certain conditions.  We have drafted 
provisions that seek to address development asp ects and needs by expanding on concepts put forward 
by other Members.  We have thus set a new limit, 20 metres, and an additional criterion – that relates 
to the scope of operation of the vessels (this limit is, inter alia , reflected in India’s proposal
3 relating 
to its definition of artisanal fisheries).     Not all Members have declared Exclusive Ec onomic Zones.  However, the majority of 
Members have established areas of national fisher ies jurisdiction, which in most known cases extends 
at least to between 4 and 12 nautical miles from the baselines.  Again, this is a crude measure – and a 
proxy for saying that these vessels have a limited scope  of operation – and thus less potential to cause 
harm in international fisheries.  On the other hand,  such limitation is difficult to monitor and enforce 
(for other Members).  We therefore propose that  a condition for developing countries granting a 
subsidy should be that the scope of operation of th e vessel is limited through appropriate provisions of 
domestic law/regulations.  Such prov isions may be enforced by stipul ating the relevant conditions for 
                                                     
 
3 TN/RL/W/203 TN/RL/GEN/144 
Page 4  
 
  granting the subsidy and/or when a fishing licence for the fishing boat is being issued.  For obvious 
reasons, such conditions should be m onitored and controlled, also after the subsidy has been granted. 
  The third parameter in the boat discipline is also only applicable for developing country 
Members and relates to a very difficult and perhap s controversial aspect – namely that of capacity 
build-up linked to underutilised fish stocks.  A lthough we would stress that there are many good 
grounds for not allowing such capacity build-up, we have nevertheless sought to elaborate a discipline 
that would allow for such build-up for developmen t purposes, and at the same time lay down certain 
criteria intended to ensure that such build up do es not have undue detrimental effects on the fish 
stocks.  Again, this poses certain definitiona l problems, but they are not insurmountable.  
Furthermore, it is clearly in the developing countries’  own interest that such  exploitation is conducted 
within sustainable limits.   There seems to be consensus that developing  countries should not have "a blank check" in 
capacity build-up.  We have drafted provisions wh ereby a condition for allowing capacity build-up is 
that the Member in question must elaborate a manageme nt plan to ensure that the stocks in the fishery 
in question are not endangered.    In our proposal, we have taken account of the discussion between Members relating to the 
role of the FAO and other international bodies.  We ha ve not envisaged any specific role for the FAO.  
However, in our view the scientific/biological bodies of RFMOs (Regional Fisheries Management 
Organisations), and other scientific and biologi cal organisations, such as the ACFM (Advisory 
Committee for Fisheries Management) of the ICES (In ternational Council for the Exploration of the 
Seas) are capable of assessing whether there are unde rutilised stocks in any particular part of the 
ocean.  Such bodies are also well suited to asse ssing whether any particular management and 
exploitation plan will ensure that underut ilised stocks are not overexploited.    
 
 We believe that our proposal adequately and realistically addresses the concern about not 
issuing a blank check.  The element of discipline in the proposal is that any management plan shall be 
approved by an independent institution, inter alia , a biological research institute or an RFMO 
(provided that it has biological expertise).    
 Furthermore, the management plan must be notified to the WTO and may thus be subject to 
questions, discussion, etc. in the Committee on Subsidies and Countervailing Measures in cases where another Member is not satisfied that relevant cond itions have been met by the subsidizing Member.  
In the event of a subsequent dis pute, the issue would be whether an approval has been given and 
notified, not whether there was scientific or fi shery reasons for giving such an approval.  
 
Green box and the issue of actionability
 
  This proposal is based on the simple concept of a new discipline as an additional element to 
the general discipline of the Agreement on Subs idies and Countervailing Measures (ASCM).  This 
means in principle that all non-prohibited subsidi es will continue to be permitted, even though they 
are actionable.  In our view, the discipline shoul d be additional and limited to the scope of that 
addition discipline, in other words in principle, we  are only extending the list of prohibited subsidies 
in Article 3 in the ASCM.   As is clear from the proposal, the proposed di scipline applies to certain subsidies directed 
towards fishing vessels.  This implies that all ot her currently permitted subsidies (specific subsidies 
that confer a benefit within the meaning of the ASCM) are allowable, though actionable.   
  TN/RL/GEN/144 
 Page 5 
 
 
   Any re-introduction of a green box in the AS CM poses both more general and definitional 
issues that have to be resolved in a satisfactory mann er if they are to be included in a discipline in a 
meaningful way.     In addition to the issue of keeping all subsid ies actionable versus a possible reintroduction of 
a green box discussed above, there are other considera tions.  Such reintroduction would, for instance 
when elaborating the scope/definition of the elements  of the green box, pose the question of what kind 
of government measures fall within/outside the scope  of the ASCM itself.  Infrastructure measures 
and the financing of management systems are examples that spring to mind.    
 If we were to define green box exceptions, they would thus have to be government 
measures/transfers that are both, at face value, ev idently specific and which confer a benefit (within 
the meaning of the ASCM).  Certain types of so cial measures might fall within this category – 
typically relief/retraining/unemployment measures.  Su ch measures could be of  a more general nature 
and not specifically directed towards fisheries.  Ot her categories could typically be related to "safety 
on board" measures or measures that aim to fulfil certain defined environmental objectives.  More 
energy-efficient engines would be an example of this category.    On balance, we have not proposed the reintr oduction of a green box although, as can be seen 
from our proposal, we have carved out in the propo sal (footnote 3) certain subsidies from the general 
boat prohibition.  This exception is very limite d in scope, but addresses some of the government 
actions that many Members would find laudable – and could thus be considered "green" or "greenish".  
The exceptions we have proposed are all for good causes, such as:   -  safety, exemplified by the installation of distress-signal apparatus or control and 
management equipment.  An example of such support would be support to install 
tamper-free electronic fishing logbooks that  would serve important scientific and 
management purposes as well as being essential instruments in combating IUU fisheries; 
  -  satellite monitoring equipment is incre asingly becoming an important instrument in 
world fisheries to control the activities of fishing vessels and to monitor prohibitions 
relating to specific fishing areas; 
  -  equipment that reduces environmentally harmful emissions would also serve laudable 
purposes.  Many Members apply special ta x measures for environmental purposes in 
order to reduce emissions. 
 
In spite of the merits described above, we have  not defined such subsidies as green.  We have 
recognized the utility of such exceptions by allowi ng them, but at the same time, for the reasons 
described in this chapter, recogni zed that such subsidies would fall within the category of actionable 
subsidies.  
Decommissioning programmes
 
  We have included the treatment of decomm issioning programmes as a separate paragraph 
(paragraph 4) in the proposal.  The reasons are twofold; first
 to emphasize that such programmes are 
not included in the prohibition, and second  that such programmes are only acceptable as long as 
essential conditions are met.  The vessel must be sc rapped or otherwise perm anently and effectively 
prevented from being used for fishing purposes anywhere in the world; and any funds or 
disbursements to a recipient benefiting from an y such decommissioning programme must not be 
reinvested in fishing vessels by the recipient.  TN/RL/GEN/144 
Page 6  
 
   A related issue raised in the pr oposal from the European Communities
4 is the possible subsidy 
for transfer of vessels – presumably used – to foreig n owners.  We have not in cluded this specifically, 
as it would be covered by the existing prohibition in Article 3 of ASCM on export subsidies. 
 Transparency and notification requirements
 
 
 A large number of Members have pointed to the inadequacies of the current notification 
regime.  From our point of view, we recognise that a major reason for the lack of transparency is the 
fact that a large part of government transfers, which de facto are granted to recipients in the fisheries 
sector, cannot be identified in specific budget lines .  Furthermore, Members may apply allocation 
criteria that are general in character, but that, when the selection is made, in fact benefit recipients in 
the fisheries sector.  We do not have any specific proposals in this respect.   However, we have elaborated a proposal for an incentive mechanism to  notify, in a specific 
form, which should also provide for greater transparen cy.  This mainly relates to the exception clauses 
of the discipline.  Although they are not captured by the prohibition, subsidies for building vessels, 
etc, of less than 15 metres must be notified, in order for them to be allowed.  Similar provisions are included for the notification of S&D measures.  This creates greater discipline and greater 
transparency, to the benefit of all WTO Members.     Thus, all programmes within the scope of exception from the general prohibition for all 
Members, including developing Members, must be notified in order for the exception to come into 
play.  Transitional periods and review
 
 
 The proposal reflects the fact that we believe that it is useful to gradually "phase in" the 
application of the new discipline after three, five or ten years depending on the development status of 
the Member in question.    Furthermore, we propose that the Annex and its  operational implications should be examined 
by the Committee on Subsidies and Countervailing Measur es five years after its entry into force, in 
order to assess whether the new provisions contribut e to the objective of reducing overcapacity and 
overfishing, and also to expand the discipline if warranted.  
                                                     
 
4 TN/RL/GEN/134 TN/RL/GEN 144 
Page 7 
 
 
  ANNEX [VIII] – FISHERIES SUBSIDIES 
 
 This Annex forms an integral part of the AS CM and covers additional provisions relating to 
certain subsidies in the fisheries sector.  
[Contextual heading: Prohibited subsidies ] 
1. The following subsidies which confer a benefit5 and which are specific, as set out in Articles 1 
and 2 of the ASCM,  shall be prohibited: 
1.1. Any subsidy granted for the acquisition, buildi ng, maintenance, repair or up-grading of 
fishing vessels6 exceeding 15 metres overall length, including any technical or electronic 
equipment7 onboard the vessel.     
[Contextual heading: Special and differential treatment for developing country Members ] 
2. Notwithstanding the provisions of paragraph 1 of  this Annex, developing country Members may 
grant subsidies as set out under paragraph 1.1 to fishing vessels with an overall length of 
20 metres or less and whose main area of operation is within that Member’s area of fisheries jurisdiction extending up to 12 nautical miles fro m the baselines.  Member s shall, through their 
domestic law, ensure that this requirement is enforced after the subsidy is granted. 
3. A developing country Member may nevertheless grant such subsidies as are listed in 
paragraph 1.1 to fishing vessels with an overall length of 28 metres or less, for the purpose of 
exploiting underutilised fish stocks within its ar ea of fisheries jurisdiction, provided that any 
build-up of fishing capacity is consistent with a comprehensive resource management plan based 
on scientific advice for the sustainable management  and exploitation of such fish stocks.  The 
management and exploitation plan  shall have been approved by an internationally recognised 
competent management or scientific body and the approved plan shall be notified in accordance 
with paragraphs 5, 6 an d 7 of this Annex.  
[Contextual heading: Special provisions
] 
4. Members shall through their domestic law ensure that: 
 
4.1. Any fishing vessel subject to a decommissi oning programme is scrapped or otherwise 
permanently and effectively prevented from be ing used for fishing purposes anywhere in the 
world;  and  
 4.2. any funds or disbursements to a recipient benefiting from any such decommissioning 
programme are not reinvested in fishing vessels by the recipient. 
 
                                                     
 
5 The provisions set out in Article 14 of the ASCM shall apply whenever an assessment of whether a 
subsidy confers a benefit. 
6 For the purpose of this Annex, fishing vessels m eans any vessel intended fo r use for the purpose of 
commercial exploitation of fishing resources, including fish processing vessels and vessels engaged in transshipment.  
7 This comprises, inter alia , engines, fishing gear, fish-processing machinery or any other equipment 
onboard the vessel. The prohibition does not cover the installation of equipment for safety or for control and enforcement purposes.  Neither does the prohibition cover equipment fitted for the purpose of reducing 
environmentally harmful emissions. TN/RL/GEN/144 
Page 8  
 
   [Contextual heading: Notification requirements
]  
5. Any fisheries subsidy set out in paragraph 1.1: 
 (a)  granted to fishing vessels of 15 metres overall length or less; 
 (b) granted under the exceptions set out in  paragraphs 2 or 3 of this Annex;  
 (c)  where the provisions of para graph 4 of this Annex apply; or 
 (d)  granted during the transitional periods as specified under the provisions set out in 
 paragraphs 8 or 9 of this Annex; 
 shall be notified to the WTO and to the Committee set out in Article 24 of the ASCM in advance of its 
implementation.  Any such notification shall be made, mutatis mutandis , in accordance with the 
provisions of Article 25 of the ASCM. 
 6. For any other fisheries subsidies, the notifica tion requirements of the ASCM apply in their 
entirety. 
7. Any subsidy granted under the provisions of this A nnex which is not notified to the WTO shall be 
considered to be prohibited for that Member.  Members who do not grant any subsidies subject to 
the notification requirements of paragraphs 5 a nd 6 of this Annex shall notify that no such 
subsidies have been granted. 
[Contextual heading: Transitional periods
] 
8. The provisions set out in this Annex shall apply after a transitional period of three years, except 
for developing country Members and for least -developed country Members, for which the 
provisions apply after a transitional period of five  years and ten years respectively from the entry 
into force of this Annex.  The applicable tr ansitional period shall be used to bring subsidy 
programmes in conformity with this Annex.  
[Contextual heading: Least-Developed country Members ] 
9. If a least-developed country Member deems it nec essary to apply subsidies prohibited under this 
Annex beyond the ten-year transitional period, it sha ll not later than one year before the expiry of 
this period enter into consultation with the Committee on Subsidies and Countervailing Measures, 
which will determine whether an extension of this  period is justified, after examining all the 
relevant economic, financial and development n eeds of the least-developed country Member in 
question.  If the Committee determin es that the extension is justif ied, the least-developed country 
Member concerned shall hold annual consultati ons with the Committee to determine the necessity 
of maintaining the subsidies.  If no such dete rmination is made by the Committee, the least-
developed country Member shall phase out those fi sheries subsidies within three years from the 
expiry of the last authorised period. 
[Contextual heading: Review ] 
10. The provisions of this Annex shall be reviewed by the Committee on Subsidies and 
Countervailing Measures after a period of five year s from it’s entry into force with a view to 
making any necessary modification to this Annex. 
 
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