WORLD TRADE  
ORGANIZATION  TN/RL/GEN/138/Rev.1 
26 January 2007 
 
 (07-0369) 
Negotiating Group on Rules Original:   Spanish 
  
 
FISHERIES SUBSIDIES:  SPECIAL AND DIFFERENTIAL TREATMENT 
 
Paper from Argentina
 
 
Revision  
 
 
 The following paper, dated 25 January 2005, is ci rculated at the request of the delegation of 
Argentina. 
_______________ 
 
  This is the first revision of Argentina's pape r of June 2006 (TN/RL/GEN/138).  Other papers 
may follow, depending on developments in the negotiations.  
I. INTRODUCTION 
1. Argentina thanks the Negotiating Group on Rules for the attention and interest paid to the 
paper "Fisheries Subsidies:  Special and Differe ntial Treatment" (TN/RL/GEN/138) and welcomes the 
wide-ranging discussions held in both  formal and informal meetings. 
2. This submission is a revision of the former pape r and its aim is to incorporate some of the 
comments made by Members and to enlarge on the ideas and concepts set forth in the previous paper. 
3. Its starting point is the belief that the WTO is  in a position to contribute significantly, within 
its sphere of competence, to the conservation of resources through strict disciplines on subsidies that 
distort production, trade and the sustainability of fi sheries resources.  Adopting an approach based on 
a prohibition "defined by exclusion" to be applied to fishing subsidies (particularly those leading to 
over-capacity and over-fishing) offers the advantage of allowing for a scheme that is both effective 
and applicable within the WTO. 
4. This submission maintains the principles set fort h in the original proposal:  the provisions on 
special and differential treatment must be substantiv e and able to meet development, subsistence and 
food security needs;  they must also provide clear  parameters for defining objective situations in 
which subsidies may be granted or maintained, in or der to provide safeguards for the sustainability of 
fisheries resources. 
II. EXPLANATION OF THE REVISION 
5. To facilitate understanding of the text and show  how it differs from the previous paper, the 
changes and additions are indicat ed paragraph by paragraph: 
(a) Paragraph X.1
:  the list of subsidies allowable for developing country Members set forth in 
paragraph 1 of the former legal draft is maintained:  (a) for fishing vessel construction, repair, TN/RL/GEN/138/Rev.1 
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  modification or outfitting, including gear acquisition or improvement;  (b) for the support of fishing 
fleet operation (e.g.  supply of fuel, bait or ice);  or (c) for artisanal fisheries. 
 
 However, the conditions set forth in paragraph X.1( a) (i), (ii) and (iii) of the former text have 
been grouped together in Paragraph X.2. 
 
(b) Paragraph X.2
:  operationalizes the concept of " surplus species " by means of an objective 
and quantifiable parameter while maintaining the pur pose of the original proposal, namely to establish 
clearly that in order for a subsidy to be granted or maintained, the national fishing capacity must be 
structurally inadequate to cover a species or group  of species and, in addition, the Member must 
guarantee that resources will not be affected. 
  To this end, a quantitative threshold is incl uded in order to define when national fishing 
capacity will be deemed " substantially lower " than that needed for the su stainable fishing of a species 
or group of species.  Developing country Members w ould thus be able to resort to subsidies only 
when the existing fishing capacity does not exceed ( 50 per cent) of that needed to cover the total 
allowable catch of a species or group of species.   The purpose of introducing the concepts "exi sting fishing capacity" and "domestic capacity" 
is to make the terms of the proposal more preci se.  With the concept "domestic capacity", the 
beneficiaries of subsidies are defined so that circ umvention can be avoided.  The notion of "existing 
capacity" has been introduced to address the situation envisaged in paragraph X1(a)(ii ) of the former 
legal draft, ensuring that any increase in domestic fishing capacity correspond s to a decrease in the 
foreign fleet operating in areas under domestic jurisdiction.   The new text further establishes that the dete rminations required by Paragraph X.2 must be 
done by the Member State.  The determinations are b ased on concepts that are widely used in fisheries 
contexts and are internationally accepted.  In this  way, when carrying out the requisite measurement 
to determine whether capacity is substantially lower, a total allowable catch will have to be calculated 
on the basis of the best available information and w ill have to be compatible with the objective of 
achieving or maintaining the maximum sustainable yield
1 of fish stocks , taking account of the 
environmental impact, and in accordance with th e United Nations Conventi on and the FAO Code of 
Conduct for Responsible Fisheries. 
 (c) Paragraph X.3 :  reflects the further conditions set in paragraphs X.2 and 3  of the former 
legal draft.  The FAO Code of Conduct for Responsible  Fisheries is referred to not in order to turn a 
voluntary document into a mandatory one, but to introduce a standard that enjoys wide recognition in 
much of the international community. 
  It also makes clear that compatibility between  national fisheries management systems and the 
FAO Code of Conduct is to be understood as applying  only to the implementation of these disciplines 
and will be without prejudice to the observance of  commitments deriving from other international 
agreements. 
 
(d) Paragraph X.4 :  since provisions on special and differential treatment amount to an 
exception to the general prohibition which, according to the approach endorsed by Argentina, should 
be the backbone of the discipline, the burden of pr oving or demonstrating fulfilment of the conditions 
for resorting to the subsidies in question must be on the developing country Member. 
                                                     
 
1 This objective is among the Millennium Goals set at the World Summit on Sust ainable Development.  
Paragraph 30(a) states in this connection:  "To achieve sustainable fisheries, the following actions are required 
at all levels:  (a) Maintain or restore stocks to levels that can produce the maximum sustainable yield with the 
aim of achieving these goals for depleted stocks on an urgent basis and where possible not later than 2015;"  TN/RL/GEN/138/Rev.1 
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(e) Paragraph X.5 :  introduces no changes to the previous draft. 
 6. The revised draft does not include payments for access to remote fisheries because there is a 
growing consensus that government-to-government payments are not deemed to be fisheries 
subsidies.  It is understood, however, that the gene ral disciplines should includ e the instances in which 
the transfer of such rights by a government to specif ic enterprises is not done in exchange for a fair 
trade price. 
7. Lastly, it should be noted that in reworking the text, particular account was taken of the 
concerns expressed by some delegations that the WT O should act within its sphere of competence.  
We therefore included a criterion already to be foun d in other agreements (such as the Agreement on 
Sanitary and Phytosanitary Measures), in which the determinations are made by the Member applying 
the standard.  The WTO only indicates the standa rd that Members are to take as a reference. 
8. A system such as this means that, in disputes, panels will not have to make new 
determinations, as the standard of review will be to establish whether the government took due 
account of standards issued by internationally recognized technical bodies. TN/RL/GEN/138/Rev.1 
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  Article X 
 
Special and Differential Treatment
2 
 
X.1 Notwithstanding Article xxx and subject to th e conditions set in this  Article, developing 
country Members may maintain or grant the following fisheries subsidies: 
  (a) For fishing vessel construction, repair, modification or outfitting, including gear 
acquisition or improvement;  or 
 
 (b) for the support of fishing fleet operation (e.g. supply of fuel, bait or ice);  or 
  (c) for artisanal fisheries.
3 
 X.2 The subsidies referred to in (a) and (b) a bove may be maintained or granted only on condition 
that their purpose is to increase domestic fishing capacity
4 if the developing country Member 
determines that the existing fishing capacity5 is substantially lower6 than that needed to: 
  (a) cover the total allowable catch
7of a given species or group of species in its maritime 
domain8;  or 
 
 (b) fill fishing quotas9 agreed within the framework of a regional fisheries management 
organization or other international agreement. 
 
                                                      
2 This legal draft is intended as part of a general framework of disciplines based on the principle of a 
"broad prohibition defined by exclusion" which is in balance with exceptions and transitional provisions. 
3 Argentina shares Brazil's idea set out in TN/RL/GEN/ 79/Rev.2 that artisanal fishing should comprise 
the fishing activities related to the subsistence of the fisherman and his family.  That is to say, activities performed at an in-shore basis with non-automatic net -retriever devices, provided that (a) the activities are 
carried out on an individual basis, incl uding, but not necessarily, the family members;  (b) the basic scope of the 
activities encompasses both family livelihood and a small profit trade;  (c) there is no employer-employee 
relationship in the activities carried out.  Conditions (a), (b) and (c) will likewise apply in the case of subsidies 
to fishers' associations. 
4 For the purpose of this article "domestic fishin g capacity" means the capacity of fishing vessels 
flagged by a Member State, owned by companies constitute d under the domestic law of that Member State, and 
operated by crews the members of which are in  the majority nationals of that State.  
5 For the purpose of this article "existing fishing capacity" means the total cap acity authorized by the 
Member State for the fishing of a species or group of  species in its Maritime domain, namely the domestic 
fishing capacity plus other vessels authorized by the Member State to fish in its maritime domain. 
6 For the purpose of this article "substantially lower" means less than [50%] of the capacity needed to 
cover the total allowable catch. 
7 For the purpose of this article "total allowable catch" refers to quantitative limits imposed by the 
Member State on the catch of a given species or a group of  species, which must be based on the best scientific 
information available and allow the maximum sustainable yi eld of the species or group of species to be reached 
or maintained without affecting existing fisheries or th e marine ecosystem as a whole, in accordance with the 
United Nations Convention on the Law of the Sea and the Code of Conduct for Responsible Fisheries. 
8 For the purpose of this article "maritime domain" re fers to the areas subject to the sovereignty or 
jurisdiction of the Member State as established in the United Nations Convention on the Law of the Sea. 
9 For the purpose of this article "quotas" means enforceable quantitative limits, established through 
scientific assessment, imposed on fish volumes of a given species for a specified period.  TN/RL/GEN/138/Rev.1 
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  X.3 Developing country Members may not maintain or  grant subsidies referr ed to in paragraph 1 
(a) and (b) above unless they demonstrate that:   (a) Every fishing vessel constructed, repair ed, modified, outfitted or otherwise benefited 
by a subsidy has a valid fishing licence and is registered under a national registration 
system; 
  (b) fishing permits granted to subsidized vessels apply solely for the species or group of 
species defined in accordance with paragraph 1 and may not be used for the fishing of 
other species;  and 
 
 (c) they have a national fisheries manageme nt system in line with the FAO Code of 
Conduct for Responsible Fisheries (1995).
10 
 
X.4 The burden of proving fulfilment of the conditio ns set in paragraphs 2 and 3 shall be on the 
Member State seeking to grant or maintain subsidies under this Article. 
 X.5 The subsidy programmes referred to in paragr aph 1 shall be subject to compliance with the 
provisions on notification and transparency in Article XXX.
11 
 
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10 Determination in the World Trade Organizatio n of the consistency of a national fisheries 
management system with the FAO Code of Conduct will be restricted to the application of this Annex and will 
be without prejudice to the observance of commitments under other international agreements. 
11 Additional flexibilities may be provided for in the case of subsidies granted by least developed 
countries.  Provision should also be made for technical assistance to developing countries that need it in order to 
comply with the provisions on notification.