WORLD TRADE  
ORGANIZATION  TN/RL/GEN/173/Rev.2 
4 March 2011 
 (11-1095) 
Negotiating Group on Rules Original:   English/ 
 Spanish 
 
 
 
FISHERIES SUBSIDIES:  SPECIAL AND DIFFERENTIAL TREATMENT 
 
Communication from Argentina, Chile, Costa Rica, Egypt and Uruguay1 
 
Revision  
 
 
 The following communication, dated 25 January 2 011, is being circulated at the request of the 
Delegations of Argentina, Chile, Costa Rica, Egypt and Uruguay. 
 
_______________ 
 
 
I. INTRODUCTION 
1. In the framework of the negotiations on new di sciplines related to fisheries subsidies, Special 
and Differential Treatment has partic ular relevance due to the combination of two elements which are 
not found simultaneously in other disciplines:  su stainability and development.  As some Members 
expressed in a previous communication2, the future disciplines on special and differential treatment 
could have significant impact on world fisheries stocks, as well as on the ability of developing countries to promote sustainable development a nd reduce poverty.  Consequently, WTO Members 
face the delicate responsibility of negotiating disci plines that provide a balance between both aims. 
 2. Due account must be taken of the fact th at, at present, the term developing countries 
encompasses a group of economies with diverse pr oductive and financial capabilities and which, at 
the same time, face diverse needs for revenue and income distribution.  Therefore, a number of 
countries have to cope with the economic limitations  of sectors of the population which directly or 
indirectly depend on fisheries and that frequently find themselves in a position of great vulnerability.  
In these cases, government aid may constitute the only one support in favor of the establishment of 
food security programs and improvement in the quality of  life for an important part of the population.  
Nevertheless, this is not the only possible relations hip between development and fisheries activities.  
At the same time, there is increasing competition among certain developing countries for access to 
fisheries resources and for market access for fisheries products, particularly as regards international 
waters.
3 
 3. In view of the former considerations, an ad equate calculation of the financial aid should take 
into account effective conservation criteria, beari ng in mind that fisheries resource depletion and 
                                                     
 
1 The present proposal of legal text  is submitted as a response to the call of the Negotiating Group on 
Rules's Chair for making contributions to the debate on th e subject of fisheries subsid ies.  This document does 
not prejudge on future contributions by co-sponsors on the same subject, and is open to commentaries and 
subscription by other Members. 
2 TN/RL/W/243 (from Australia, Chile, Colombia, Icel and, New Zealand, Norway, Pakistan, Peru and 
United States). 
3 TN/RL/W/218, paragraph 26 (from New Zealand). TN/RL/GEN/173/Rev.2 
Page 2  
 
  overexploitation would imply the e xhaustion of the special and diffe rential treatment discipline in 
itself, and would therefore have a contrary effect to the one originally foreseen, that is, a set of 
provisions to facilitate Members' so cial and economic development, no t just a collection of measures 
addressed to alleviate a short run situation.  
4. To that extent, it is important to point out that a long run development of fisheries activity 
requires sustainability criteria which should be applied to all fisheries resources;  that is to say, not 
only fish stocks within national jurisdictions, but fish stocks fished in international waters and 
straddling and highly migratory species as well. 
 
5. It should be also stressed that the majority of WTO developing Members are  signatories of 
the United Nations Convention on the Law of th e See (UNCLOS) and have adopted several 
provisions of the FAO Code of Conduct for Responsible Fisheries, even though the latter is not mandatory.  The FAO has produced several reports on the worrying state of overexploitation of the majority of fisheries in the world.
4  Besides, fisheries subsidies negotiators have taken part in several 
seminars sponsored by NGOs, in which the urgent n eed for action to revert the current state of the 
vast majority of fisheries in the world ha s been directly and convincingly highlighted.5 
 6. The current communication aims to make a cont ribution to the definition of the core concepts 
that should form part of an S&DT discipline, especially in light of Chair's text of November 2007 and of prior communications by several Members.
6  The starting point is the premise that S&DT 
provisions shall be substantive and appropria te, allowing Members to address development 
necessities, as well as subsistence and health secur ity, while establishing clear parameters for defining 
objective situations in which subs idies could be granted or mainta ined, in order not to represent a 
threat to fisheries resources.  II. EXPLANATION OF THE PROPOSAL 
7. The sponsoring delegations of this communica tion consider that, in order to reflect an 
adequate balance between sustai nability and development, the c onditions under which a developing 
country could exercise its right to grant or mainta in subsidies to fishing ac tivities in accordance with 
the future disciplines to be adopted should be:   
 a) with regard to capacity: 
i) the existence of under-exploited or une xploited fisheries resources within its 
jurisdiction (exclusive economic zone);   
   a n d ,   
ii) the lack of enough fishing capacity to exploit the natural resource in a 
sustainable way. 
b) with regard to infrastructure:  the impr ovement in physical port facilities exclusively 
or predominantly for activities related to mari ne wild capture fishing, in jurisdictional 
waters, related to the livelihood of fishers and their families, and in compliance with 
FAO Code of Conduct. 
                                                     
 
4 See e.g. "The State of World Fisheries and Aquaculture 2008 ", Fisheries and Aquaculture 
Department, Food and Agriculture Organization of the United Nations, Rome, 2009. 
5 See e.g. documents TN/RL/W/184 and TN/RL/W/218 (both from New Zealand). 
6 For instance, documents TN/RL/GEN/138, TN/RL/GEN/138/Rev.1, a nd TN/RL/W211 (from 
Argentina);  TN/RL/GEN/151 and TN/RL/GEN/151/Rev.1 (from Argentina and Brazil), TN/RL/W/234 (from Argentina, Chile, Colombia, Ecuador, Mexico and Peru), and TN/RL/W/243 (from Australia, Chile, Colombia, 
Iceland, New Zealand, Norway, Pa kistan, Peru, and United States).  TN/RL/GEN/173/Rev.2 
 Page 3 
 
 
  8. Compliance with these two conditions would allow to reach a balance between exploitation 
and sustainability in any circumstance, and this w ould allow the diverse situations prevailing within 
the group of WTO Developing Country Members to be taken into account. 
 
9. Reaching such equilibrium w ould necessarily require the future disciplines to be flexible and 
dynamic, in order to be able to keep pace with  technological changes and adapt to developmental 
change in beneficiary countries.  The latter is one  of the reasons why it is considered convenient and 
desirable to avoid the use of static parameters su ch as boat length, percentage of participation in 
marine capture fisheries, etc. in the definition of  conditionalities for the S&DT  disciplines.  Besides, 
whenever possible, it would be desirable to avoid the use of terms which do not have a generalized 
and agreed definition among WTO Members, such us "small scale fisheries" or "artisanal fisheries", 
in order to avoid not only the circumvention of disciplines, but also unnecessary controversies with 
respect to the scope of these definitions. 
 
10. It should be also stressed that S&DT pr ovisions (as well as general exceptions) should be 
contingent upon a general discipline on prohibitions.  Consequently, the current proposal will be 
subject to modifications and changes, depending on  the final design of the rest of the disciplines 
and, particularly, of those referring to prohibition and general exceptions.7 
 
11. Nevertheless, a change in the level of cove rage would not necessarily imply a change in the 
structure of the S&DT discipline which, broadly, could be described on the basis of the following 
three necessary elements:   
  a) definition of S&DT beneficiaries  b) conditionalities required in order to access to the benefit;     and,   
 c) exceptions to conditionalities. 
 
a) Beneficiaries of Special and Differential Treatment  
 
12. According to the Doha Declaration
8 and the Hong-Kong Ministerial Declaration of 20059, the 
beneficiaries would be all developing Members.  B esides, special attention shall be paid to least 
developed countries (LDC).  
 13. In addition, there is certain consensus am ong Members as to the necessity of a special 
consideration to subsistence activities, which ar e essential for a great number of inhabitants in 
developing countries.  According to what has been  said above, any reference to concepts such as 
"artisanal fisheries" and "small scale fisheries" has been avoided, due to the fact that Members have 
not reached agreement as regards their definition.  Hence, in relation to the subject of "subsistence 
activities", the present proposal keeps the de finition used in a former communication.
10 
 
b) Conditionalities 
 14. The sponsors consider that the conditionalities shall be strict, and aimed at the compliance 
with the exigencies of two distinct subjects:  sustainability and transparency .  In the first case, the 
current proposal takes up the text of the former communication TN/RL/GEN/138/Rev.1, according to 
                                                     
 
7 Articles I and II respectively, of Chair's Text of November 2007, TN/RL/W/213.  This mention has 
the sole purpose of providing Members with a reference, and shall be understood as being without prejudice to 
the final structure and wording of provisions contained in the new disciplines once the negotiation is finished. 
8 WT/MIN(01)/DEC/1. 
9 WT/MIN(05)/DEC, paragraphs 2 and 9, Annex D. 
10 TN/RL/GEN/138/Rev.1. TN/RL/GEN/173/Rev.2 
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  which the developing Member shall grant or mainta in a subsidy only when its fishing capacity is 
insufficient to cover the level of allowable catch (tha t is to say, the level established by the Member 
itself within its jurisdiction), taking into account that this allowable level shall not exceed the 
maximum sustainable yield (MSY).
11  The former provision shall be complemented to the prohibition 
established in Article I.2 of the Chair's text of 2007 (subsidies affecting fish stocks that  are manifestly 
overfished12), and the provisions in Articles IV (unfa vorable effects), V (fisheries management), 
VI (notifications) and VIII (dispute settlement), in wh ichever form they are finally incorporated to the 
disciplines.13  Such provisions will also apply to subsidies granted or maintained for physical 
infrastructure related to fisheries;  in addition, th ese latter subsidies will have to be in compliance with 
the FAO Code of Conduct. 
 
15. With regards to transparency, the co-sponsors c onsider that this is a cornerstone to the new 
disciplines.  In order to reassure  the effectiveness of the new disci plines, all exceptions –including 
Special and Differential Treatment exceptions– shall be  adjusted to fulfill transparency requirements.  
Special consideration is given in Article III.5 of the current proposal to the case of those countries that 
may need technical assistance in order to fulfill those transparency provisions.  
 
c) Exceptions to conditionalities 
 
16. Exceptions to conditiona lities shall be restricted to the case of those least developed country 
Members of WTO, which have been already includ ed in other dispositions of the Agreement on 
Subsidies and Countervailing Measures (paragraph a) of Annex VII).14  The proposal provides less 
strict conditionalities in the case of fishing activities related to the subsistence of fishers and their 
families within the territory of developing Members.   17. None of the cases mentioned in the latter pa ragraph should  be subject to the specific 
conditionalities of special and differential treatme nt (Articles III.2, III.3 and III.4 of the text infra );  
nevertheless they would be subject to the conditionali ties considered in other articles of the Annex (in 
particular, Articles I.2, IV, V, VI and VIII).
15  In order to facilitate the fulfillment of the latter, special 
provisions could eventually be considered (for in stance, longer periods to implement and notify the 
programs). 
 
                                                      
11 This conditionality would require Members to comply  with international rules currently in force, 
with regards to conservation of reso urces within Members' jurisdiction, including territorial waters, EEZ and 
high seas.  With regards to fishing in EEZ, UNCLOS Ar ticle 61 prescribes that co astal States parties shall 
ensure through proper conservation and management measures that the maintenance of the living resources in 
the EEZ is not endangered by over-exploita tion.  Such measures shall also be  designed to maintain or restore 
populations of harvested species at levels which can produce the maximum sustainable yield, as qualified by 
relevant environmental and economic factors, including the economic needs of coastal fishing communities and 
the special requirements of developing States, and taking into account fishing patterns, the interdependence of 
stocks and any generally recommended international minimum standards, whether sub-regional, regional or 
global. 
12 The term "unequivocally", in the document TN/RL/GEN/213, proved to be very difficult to define, 
as evidenced by the comments of the majority of the Members.  As a consequence, in this communication the 
term "manifestly" has been incorporated, as previous ly introduced by the United States in his last 
communication TN/RL/GEN/165 and in accordance with the definition provided there (footnote 3, page 5, of 
the stated communication). 
13 See footnote 7 to section II, "Explanation of the Proposal", supra . 
14 The flexibility for those least developed members is  considered in Article III.1 of Chair's text of 
November 2007, and has been supported by several Members in a previous declaration (TN/RL/W/243, point 18). 
15 See footnote 7, supra .  TN/RL/GEN/173/Rev.2 
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  ANNEX VIII 
 
FISHERIES SUBSIDIES 
 
Article III 
 
Special and Differential Treatment 
 
 III.1 In the case of developing country Members, subsid ies referred to in paragr aphs I.a) and I.c) of 
Article I of this Annex
16, shall not be prohibited, subject to the provisions established in this article. 
 III.2 A developing country Member may only main tain or grant subsidies referred to in 
paragraph 1 if that Member has reliably notified that its domestic fishing capacity
17 is substantially 
lower18 than that needed to c over the total allowable catch19 of exploited stocks20 exclusively in the 
maritime domain21 of the Member. 
 III.3 Notwithstanding the provisions of Article III.2 above, a developing country Member that 
maintains or grants fisheries subsidies pursuant to pa ragraph 1 of this Article shall ensure that, even if 
fully utilized, the resulting fishing capacity
22 will not exceed the level of sustainable catch of the 
exploited stock.  
 
III.4 In the case of developing country Members, subsidies referred to in paragraph 1.d) of 
Article I of this Annex23 shall not be prohibited, only if: 
 
a) they have as ultimate purpose the repair, renewal, modernization, or any other 
modification or improvement of physical por t facilities, exclusively or predominantly 
dedicated to certain activities relate d to marine wild capture fishing24 (for example, 
piers, mooring, fish landing and gatheri ng facilities, as well as facilities for treatment 
of fisheries resources landed in port, and security and hygiene conditions); 
 
                                                      
16 See footnote 7, supra . 
17 For the purpose of this Article, "domestic fish ing 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. 
18 For the purpose of this Article, "substantially lower"  means less than [X%] of the capacity needed to 
cover the total allowable catch. 
19 For the purpose of this Article, "total allowabl e 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 FAO Code of Conduct for Responsible Fisheries. 
20  "Exploited stocks" shall mean all fish stocks that  are being exploited below levels which are capable 
of producing a long term maximum sustainable yield (including the ones with no or almost no fishing activities), based on the best scientific evidence available. 
21 For the purpose of this Article "maritime domain" refers 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. 
22 "Resulting fishing capacity" means the total capacity authorized by the Member for the fishing of a 
stocks or group of stocks within its jurisdiction, namely the domestic fishing capacity plus the capacity of other 
vessels authorized by the Member to fish within its jurisdiction. 
23 See footnote 7, supra . 
24 These activities are defined below in Article II I.8.b and footnote 27 of the present article. TN/RL/GEN/173/Rev.2 
Page 6  
 
  b) they are granted or maintained in co mpliance with the FAO Code of Conduct for 
Responsible Fisheries. 
 III.5 Notwithstanding the provisions in Article VI (Notifications), to the ends of the 
abovementioned notification in Article  III.2, and the grants established in Article III.3, a developing 
Member granting subsidies in compliance with the pr esent article shall include in its notification to 
the Committee on Subsidies and Countervailing Measur es a Register of vessels which shall contain 
information that will permit to establish ex ante  the level of fishing effort in their operations regarding 
the fishing resource subjects to exploitation.  To that  end, it will be credited in the register the specific 
characteristic that properly describes the level of potential fishing effort of the vessel.
25  Similarly, 
physic changes or transformations in the vessels regi stered shall be informed, together with a measure 
of the variation in fishing effort, as the result of transformations occurred or the incorporation of new 
vessels to the Register.26  Besides, the Register will contain a list with all valid fishing licenses 
belonging to vessels benefited by subsidies menti oned in Article III.1.  These licenses shall apply 
solely for the species or group of species defined in  accordance with the provisions of this Annex, and 
may not be used for the fishing of other species; 
 III.6 Subsidies mentioned in this article shall be subject to provisions of Articles I.2 (overexploited 
stocks), IV (unfavorable effects), V (fisheries management), VI (notifications) and VIII (dispute 
settlement) of this Annex.  
III.7 Members shall give due regard to the need s of developing countr y Members in complying 
with the requirements of this Annex, including the conditions and criteria set forth in this Article and 
in Articles V (fisheries management) and VI (notifi cations), and shall establish mechanisms for, and 
facilitate, the provision of technical assistance in this regard, bilaterally and/or through the WTO 
Secretary.  Members mentioned in paragraph 8.a infra  shall have a time period of [X] years in order to 
implement the measures of this Annex.  
 III.8 Paragraphs 2 and 3 of this  Article shall not apply to: 
  
a) developing country Members menti oned in paragraph a) of Annex VII. 
 
b) subsidies provided by developing country Members to fishing ac tivities related to the 
subsistence of fishers and their families.
27 
  
__________  
                                                     
 
25 For the purpose of this article, "specific characteristic  that properly describes the level of potential of 
fishing effort of the vessel" means st ructural characteristics of fishing vesse ls, such as length of the boat, hold 
capacity, power of the main engine  or working surface of the ship. 
26 For an effective application of this proposal, the disciplines contained in Article VI (Notifications) 
are fundamental. 
27 These are activities exclusively performed in jurisdictional waters, provided that (a) the activities are 
carried out by fishermen on an individual basis, or through organizations of few members, including, but not 
necessarily, the family members;  (b) they satisfy the cond itions to be classified within the lowest category of 
economic activity;  and (c) the basic scope of the activities encompasses to obtain the means for family livelihood, including small scale profit trade.