WORLD TRADE  
ORGANIZATION  TN/RL/W/184 
18 July 2005 
 (05-3190) 
Negotiating Group on Rules Original:   English 
  
 
PROMOTING DEVELOPMENT AND SUSTAINABILITY IN 
FISHERIES SUBSIDIES DISCIPLINES: 
AN INFORMAL DIALOGUE ON SELECT TECHNICAL ISSUES 
 
Communication from  New Zealand
 
 
  The following communication, dated 14 July 2005, is being circulated at the request of  the Delegation of New Zealand.  
_______________ 
 
  In the interests of keeping th e Rules Negotiating Group informed of related events outside the 
WTO, we attach the Summary of the Chair of the recent UNEP Workshop on Fisheries Subsidies 
Disciplines. 
 TN/RL/W/184 
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 PROMOTING DEVELOPMENT AND SUSTAINABILITY IN 
FISHERIES SUBSIDIES DISCIPLINES: 
AN INFORMAL DIALOGUE ON SELECT TECHNICAL ISSUES 
 
International Environment House, Geneva 
30 June 2005 
 
Chair’s Summary  
 
 
Background 
 
 On 30 June 2005, as part of the recently la unched UNEP project on “S ubsidies, Development 
and Sustainable Fisheries Management”, UNEP conven ed an informal dialogue on fisheries subsidies 
in Geneva, the sixth meeting UNEP convened on this issue since 1997.  Preparation of the 
background papers was made possible with generous  support from the Government of New Zealand.  
All workshop materials are av ailable at the UNEP website 
(http://www.unep.ch/etb/events/2005rtGeneva.php ). 
 
 The focus of the workshop was on select issues of trade, development, and sustainability in 
the current WTO fisheries subsidies negotiati ons. Specifically, this meeting sought to:  
 
• Identify options that advance sustainable development of artisanal fisheries while 
disciplining fisheries subsidies in the WTO; 
 
• Investigate how Special and Differential Treatme nt in the context of fisheries subsidies 
can link new trade rules to development, poverty reduction and environmental issues, 
 
• Receive feedback on three UNEP-commissioned st udies and identify follow-up steps that 
will direct UNEP’s future efforts in this area. 
 
 Participants included approximately 50 indi viduals from governments, IGOs and NGOs, all 
speaking in their personal capacities.    This summary report was prepared by Anja von Moltke (UNEP, Economics and Trade Branch) under her personal responsibility as the works hop chair.  It is neither a consensus document 
nor fully comprehensive. Instead it seeks to review the main issues raised and suggestions made by 
participants. 
 
Introductory Session  
 
1. The meeting was opened by Hussein Abaza (Chief, UNEP, Economics and Trade Branch) and Ms. von Moltke, who outlined the need for di sciplines on fisheries subsidies that safeguard 
sustainability, ensure development, and promot e opportunities for developing countries to produce 
and trade fisheries products, as called for by th e Doha Declaration (¶¶ 28 & 31), and the 2002 World 
Summit on Sustainable Development Plan of Implementation (¶ 31(f)).   
 2. Sebastian Mathew then made an opening pr esentation, setting the current negotiations in the 
context of the urgent need for a “paradigm shift” towards sustainability in the fisheries policies of 
many developing countries, calling in particular for governments to move from a simple focus on the 
“development of fisheries” towards “better resource management”.  With the continuing growth in 
marine fishing by developing countries (up from a 40% share of total capture in the 1960s to 70% in  TN/RL/W/184 
 Page 3 
 
 
 2002), due consideration must be given to the fact th at 75% of all fisheries are currently either over-
exploited, fully-exploited or significantly deplet ed.  Mr. Mathew further noted that although the 
quantity of fisheries subsidies provided by develo ping countries is relatively small, it remains 
important to address how subsid ies can be meaningfully reemployed to emphasize sustainable 
development and effective resource management.  Session I — Approaches to Artisanal Fisheries: Options for Their Definition and Treatment 
Under New WTO Rules 
 3. David Schorr presented a UNEP-commissioned paper entitled “Artisanal and Small-scale 
Fishing:  Promoting Poverty Reduction and Community Development through New WTO Rules on Fisheries Subsidies”. Among the main points presente d were:  (i) the importance of artisanal fisheries 
to sustainable development, to livelihoods, food supplies, and resource husbandry in critical coastal 
regions; (ii) the fundamental need for poverty reduction and development in artisanal fishing 
communities; (iii) the worldwide “sustainability cha llenge” facing artisanal fisheries as a result of 
multiple factors, including the dramatic growth in fi shing capacity in many artisanal fisheries; (iv) the 
relatively small quantities of subsidies to artisanal  fisheries, and the cl ear evidence that they 
sometimes have positive and other times significant negative impacts; and (v) the overall importance 
within the WTO context of finding balanced solutions on artisanal fisheries, taking account of both 
the pressing need for human development and th e reality of the sustainability challenge. 
 4. In this context, the paper described the difficu lty in finding a universally applicable definition 
of “artisanal fishing”, and proposed that WT O negotiators craft a narrow definition based on 
consideration of the policy motives underlying current or future subsidies to artisanal fisheries (with 
particular attention to poverty re duction and development).  The pape r argued that there would remain 
an inevitable need for close atten tion to sustainability issues whenever  subsidies to artisanal fisheries 
were aimed at transforming the pattern or scale of fishing.  Finally, the paper proposed identifying “high risk” subsidies to artisanal fisheries, and suggested several options for incorporating 
sustainability considerations into new rules designed to give special treatment to artisanal fisheries. 
 
5. Prepared comments by three developing co untry participants supported many of the 
conclusions drawn by the paper, emphasizing:  the importance of artisanal fishing; the sustainability 
problem in the sector and the mixed role of subsid ies in the context of that problem; the absence of a 
single universally applicable definition of “arti sanal fishery”; and the need for attention to 
sustainability in new WTO disciplines on artisanal  fishing.  Two of the commentators questioned 
whether a very narrow definition of “artisanal fisheries” would be possible, but agreed that an overly broad definition could also be problematic.  All agre ed with the basic notion that criteria related to 
sustainability should be explored within new rules.  6. The subsequent open floor discussion emphasized the following points:  
 
(a) Both the “developmental imperative” and the “su stainability challenge” are very real in the 
artisanal fishery sector, and both should be refl ected in any new WTO subsidies disciplines. 
Data limits continue to hamper  understanding of subsidies to artisanal fisheries, and further 
quantification and analysis of these subsidies and their impacts would be very useful.  Several 
developing country experts referred to  the problematic nature of some subsidies to artisanal fisheries, 
and noted the tendency of such subsidies to have  unintended consequences and to endure beyond their 
original purpose.  
(b) In the absence of a universally applicable defin ition of artisanal fisheries, there is a clear need 
for a definition tailored to the specific needs of  the WTO context.  Such a definition could 
reflect the motives for subsidizing the sector while being narrow enough to avoid creating a 
broad loophole in any new disciplines. The principal policy motives underlying subsidies to TN/RL/W/184 
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 artisanal fisheries include poverty reduction, economic and social development, food security, 
maintaining employment, and improving fisheries management.  In this regard, it was noted 
that there is significant overlap between some of the questions raised in the context of 
artisanal fisheries and the more general questions of “special and differential treatment” for 
developing countries, discussed in the second session of the workshop. 
 
(c) Participants also discussed subsidies aimed at  maintaining the viability of small-scale fishing 
communities in the absence of a link to poverty reduction or developmen t.  Such subsidies 
(tentatively labelled “cultural preservation” s ubsidies in the workshop background paper) 
clearly reflect a set of social policies considered legitimate and important by many governments.  The difference in  character of such from those aimed at poverty reduction and 
development opened the question whether such s ubsidies would best be captured  within 
provisions for “artisanal” fisheries.  This discussion also touched on whether provisions for artisanal fisheries should extend to all WTO members, or only to developing country 
members, as well as on the potential need for a distinction between “artisanal” and “small 
scale” fisheries. 
 
(d) Participants broadly agreed on the need for disciplines appropriate to the WTO’s competence 
and mission, and thus for rules that concentr ate on the prevention of international economic 
distortions, including production distortions as well as classic export market distortions.  
There is a need for further consideration of ho w subsidies to the artisanal fishery sector may 
cause such distortions, and in particular for an e ffort to identify subsidi es to artisanal fisheries 
that pose a particularly “high risk” (e .g., capacity-enhancing subsidies).   
 (e) Many participants reiterated the need to c onsider the biological and regulatory “fisheries 
management context” surrounding fisheries s ubsidies, given the role it can play in 
determining whether a given s ubsidy programme has positive or negative impacts.  Both the 
need for and the difficulty of including such  considerations in WTO subsidy rules were 
discussed, and a number of options considered.  The concept of avoiding subsidies to fisheries 
considered “patently at risk ”, as recently introduced into the negotiations, has drawn 
substantial interest.  The concrete details of an approach along those lines are a priority for 
further discussion, as is the institutional framewo rk within which related questions could be 
handled during implementation of new WTO rules.  In this regard, the special problems of the 
artisanal context were discussed, including the possible “sequencing” of conditionalities (e.g. 
phasing in requirements for certain minimum le vels of fisheries management regulation 
within artisanal fisheries). 
 
Session II – Approaches to Special and Differenti al Treatment for Developing Countries in the 
Context of New WTO Subsidy Disciplines$ 
 
7. Vice Yu presented a UNEP-commissioned paper on “Reflecting Sustainable Development and Special and Differential Treatment or Developing Countries in the Context of New WTO 
Fisheries Subsidies Rules”.  Among the main points presented were:  (i)  S&D is not an exception to 
WTO rules, but rather a fundamental part of the mu ltilateral trading system th at aims to take into 
consideration the differing situations and needs of  developing countries; (ii) many developing 
countries feel that S&D has historically proved ineff ective, for a variety of reasons; and (iii) given the 
extraordinary strategic importance of the fisheries sector to developing countries, new WTO fisheries 
subsidies disciplines should avoid the imbalances and deficiencies that have impaired other S&D 
clauses.  8. In this context, the paper presented five po ssible approaches to S&D within the context of 
new fisheries subsidies disciplines:  (i) clarifying  the definition of “subsidy”; (ii) imposing prior 
authorization requirements on qualifying programmes;  (iii) crafting a “positive list” of permitted  TN/RL/W/184 
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 subsidies; (iv) granting S&D to subsidies be low a de minimis threshold; and (v) imposing 
“sustainable development-based” eligibility criteria on qualifying programmes.  The paper provided a 
critical analysis of the strengths and weaknesses of e ach option.  In addition, the paper examined other 
means of ensuring that S&D returns meaningful bene fits to developing countries, such as reducing 
developing country exposure to dispute settlem ent and countervailing duty measures, and increasing 
positive measures for technical assistance and capacity building.  Finally, the paper briefly examined 
approaches to “transitioning out of S&D”, as a complement to accepting the permanent and non-
exceptional nature of S&D provisions themselves.  9. Prepared comments by three developing co untry participants noted the timeliness and 
relevance of the paper to the current WTO talks, an d considered that the options set out in the paper 
offered a good basis for discussion.  Emphasis was pl aced on the important role trade can and likely 
must play in the development strategies of many developing countries, particularly in the fisheries sector.  
10. Much of the ensuing roundtable discussion focussed on specific options for including S&D 
within new fisheries subsidies disciplines.  While the discussion clearly reflected a variety of views, 
the conversation revealed the following trends:  (a) The “clarifying the definition” approach did not receive significant interest or support.  
Among the shortcomings of such an approach would be incorporati ng distinctions among 
WTO members into the fundamental terms of Artic le 1, and the strong likelihood that altering 
the Article 1 definition in this way could overl y weaken new fisheries subsidies disciplines. 
 (b) The “prior authorization” approach receive d only a few comments, but was considered by 
some to be politically difficult and possibly burdensome. 
 
(c) The “positive list” approach was viewed fa vourably by a number of participants.  One 
possibility would be a hybrid of the “positive list” and the “sustainable development-based 
eligibility” approach. 
 (d) The “ de minimis ” approach also drew positive attention,  although it was also noted that even 
this approach could result in overinvestment a nd overcapacity if no additional precautions are 
taken. 
 (e) The “sustainable development-based eligibilit y approach” also received substantial positive 
attention.  The critical link between long-term sustainability of developing country fisheries 
and the achievement of economic development goals was repeatedly noted.  Here again, 
participants called for further exploration of th e terms and institutional mechanisms needed to 
allow appropriate attention to the fisheri es management context within WTO rules. 
 11. The discussion of the “sustainable developmen t-based eligibility approach”, and of such 
related terms as “patently at risk” fisheries, raised  a number of significant questions similar to those 
discussed in the first session on ar tisanal fishing, including: 
 (a) What would be the baseline for establishi ng sustainable development-based criteria? 
 (b) How could such an approach deal with the variable availability, reliability, and independence 
of fisheries data? 
 (c) What institutions outside the WTO could be  brought into the implementation of any new 
WTO fisheries subsidies rules? 
 TN/RL/W/184 
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  (i) The FAO has been proposed as an organization that could offer technical and 
scientific support for fisheries subsidies S&D provisions.  Such an arrangement would require a legal mandate and appr opriate allocation of resources.  
  (ii) Existing regional fisheries manage ment organizations (“RFMOs”) and FAO 
agreements such as the ‘Code of Conduct’ c ould be used as a starting point, but more 
legally binding instruments would eventually be needed.  
  (iii) While new fisheries subsidies rules mu st be “grounded in the WTO”, the WTO has 
experience with a range of institutional m echanisms for creating linkages to other 
IGOs with expertise and authority in areas where overlap with the WTO mandate 
occurs.  Such linkages could provide a basis for further exploration of potential institutional mechanisms in the fisheries subsidies context. 
 12. Other views expressed by various particip ants during the open floor discussion on S&D 
included:  
 (a) Discussion of S&D in the context of fisheries subsidies might be more effective if kept 
separate from broader systemic efforts at S&D reform; 
 (b) S&D provisions contributing to trade, devel opment, and environmenta l goals for developing 
countries should remain distinguishable from ‘gre en box’ non-actionable subsidies that will 
apply for all countries (some participants emphasised that developing countries are not 
seeking a ‘blank cheque’ via S&D rules, but rather  provisions that enable them to meet their 
goals);  
 
(c) The issue of eligibility for S&D, including qu estions of initial distribution of rights to S&D 
and subsequent “graduation” provisions, need furt her discussion.  It is clear, however, that 
S&D provisions should be revised and review ed over time to reflect changing trade, 
environmental, and developm ent conditions and needs; 
 (d) Many of the issues surrounding artisanal fish eries discussed in session 1 feed into the S&D 
debate. Similarly, the question of government- to-government payments in the context of 
fisheries “access agreements”, although not di scussed in detail during this workshop, was 
seen as an issue critical to developing count ry concerns, and in need of resolution. 
 (e) Technical assistance is essential both for cr eating and utilizing reliable scientific information 
and for effectively implementing reforms. 
 13. In general, most participants agreed that S&D rules should be defined simply and 
operationally, yet sophisticated enough to encapsulate  the complexity of the issues while avoiding 
loopholes.  It is important that negotiations rema in centred on subsidies and on production and trade 
while tackling sustainability issues. Further, for rules to reflect the intentions of negotiators, they need 
to be strong enough to avoid WTO appellate bodies interpreting or making judgements over 
ambiguous terminology.  In recogn ition of its core competencies, it is clear that new WTO rules 
cannot solve all of the problems of overcapacity and overfishing.  
Way forward 
 14. UNEP informed participants th at the two papers would be revised in line with the discussion 
and the comments received. They will be made available prior to and at the Hong-Kong WTO ministerial meeting.   TN/RL/W/184 
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 15. Participants considered the meeting very timely and useful for the ongoing WTO 
negotiations.  UNEP was encouraged to  continue to convene meetings in such an informal atmosphere 
in order to address the technical side of  highly complex and political issues.  
 16. Continued technical research by UNEP and di alogue between stakeholders was suggested in 
particular in the following areas: 
 (a) additional information about s ubsidies and development in the context of artisanal and small-
cale fisheries; 
 
(b) access agreements, with particular attention to sustainability, development and trade goals 
within access agreements; 
 (c) options for sustainability cond itionality criteria and benchmarks; 
 
(d) options for institutional mechanisms to implement and monitor conditionality criteria. 
 17. UNEP was also encouraged to continue pr oviding technical and political assistance through 
its country studies on the impact of fisheries subsidies.  
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