Rules on Fisheries Subsidies Negotiations: Implications for small scale fisheries

Despite the focus on fisheries subsidies disciplines, the text has numerous contentious issues related to management of fisheries subsidies which go beyond the trade mandate and has implications in relation to member’s rights to manage its fisheries resources.
Scope:
The scope of the fisheries subsidies applies to Article 1:1 of the ASCM which includes specific subsidies. It excludes inland and aquaculture fisheries but is limited to marine capture at sea. It also applies to fishing and fishing related activities which are not specific. The meaning of fishing in the chairs text refers to fishing as attracting, locating, catching, taking or harvesting fish or any activity which reasonably results in the attracting, locating, catching, taking or harvesting of fish.  The fishing related activities means any operation in support of or in preparation for fishing, including landing, packing, processing, transhipping or transporting of fish that have not previously landed at a port.
 In relation to small scale fishers, there needs to be greater clarity on the “at sea”. The UNLCOS provides coastal states members the rights over its coastal areas and EEZ to manage its resources. For small scale fishers, even though fishing at the moment is at the coastal area but limiting to this may constrain the aspiration of some of the coastal states to scale up and venture into EEZs. So the question is are small scale coastal fisheries members willing to give up their already intact rights in the UNCLOS.
 Moreover, the scope of the discipline applies to fishing related activities and operations in support of or preparation of fishing which includes landing, packaging, processing or transporting o fish. The disciplines in the fisheries subsidies therefore aims to discipline the actors in the fisheries value chain too. For small fisher folks that are small actors in the value chain that may use small boats that transport fish from the mother ship into the ports of small states would be affected.
This brings me to the definition of vessels which means any vessel, ship or any type of boat used for, equipped to be used for, or intended to e used for fishing or related activities at sea. Sometimes in small states, the small boats are used to offload fish from the mother ship that cannot anchor into a small island port, small fisher folks operate these small boats. Here, they would also be disciplined.
Illegal, Unreported and Unregulated Fishing (IUU)
 In the current text of the chair in relation to IUU there are two proposals in brackets (1) which covers the disciplines on the prohibition of fisheries subsidies to vessels and operators in all waters meaning including the EEZ. The second proposal states that the prohibition regarding unreported and unregulated fishing, shall not apply to subsidies granted or maintained by developing country members, including least developed country (LDCs), for fishing or fishing-related activities at sea by vessels other than large-scale industrial fishing vessels within their territorial sea. In the interest of small-scale fisherfolk special and differential treatment in relation to unreported and unregulated fishing is important. Under UNCLOS, countries may manage their fisheries resources up to their EEZ. Also, the UNCLOS and other fisheries agreements recognize the special requirements of developing countries in terms of technical help and capacity building for proper regulation and reporting. These include MCS, e-reporting systems, and catch reporting. The SS fisher folks need to develop these capacities before taking any burdensome commitments. Even the voluntary small-scale fisheries guidelines (SSF) outlines the number of implementation requirements that SSF need to implement which alone are costly. These include policy coherence, coordination, and collaboration. Research, information, and communications systems for collecting fisheries data, bioecological data, and capacity building in value chains. Even the SSF recognizes that they encouraged all parties to implement these guidelines under national priorities and circumstances. Based on members' capacities.
·               Overfished Stock
The article states that no member shall grant or maintain subsidies for fishing or fishing related activities regarding an overfished stock when any of the following situations related to the stock are present (1) lack of recovery of the stock or (2) continuous reduction in the level of the stock.
Now in order to determine the fish stock being overfished there are a number of options which are bracketed in the new chairs text. These are
1)     The fish stock recognized as overfished stock be done by member under whose jurisdiction the fishing is taking place or by a relevant RFMO/A based on best scientific evidence available to and recognized by them.
2)     A fish stock is overfished if it is at such a low level that mortality form fishing needs to be restricted to allow the stock to rebuild to a level that produces maximum sustainable yield (MSY) or alternative reference point based on best scientific evidence available to and recognized by the member
3)     The prohibition under para 4.1 shall not apply to subsidies granted or maintained by developing country members including LDC members for fishing related activities within their territorial waters. (12 nautical miles).
Implications: To assess fish stock, developing countries lack the capacity. The capacity has to be developed first and foremost prior to such assessment. Secondly, the fish stock assessment is part of the fisheries management. This is a complex and burdensome task as such will affect small states. Under UNCLOS, members have the right to manage fish stocks up to their exclusive economic zone. By limiting and taking exemptions up to territorial waters, developing countries are also giving up their rights to manage the marine resources in their own EEZ. This has a huge developmental impact. Furthermore, small fisher folks need to reflect on the future policy space for small scale fisheries if in future it intends to scale up and develop into medium enterprises and gain market access as well as have the right to manage its fisheries resources.
 
Overfishing and Overcapacity
This include subsidies in relation to overcapacity and overfishing and disciplines on capital and operating cost.
The capital costs (CC)  include cost of construction, acquisition, modernisation, renovation or upgrading of vessels, purchase of machine and equipment for fishing vessels.
Operating costs (OC) includes cost of fuel, ice, bait, personnel, social charges, insurance and gear.
Income support of vessels or operators or the workers they employ, payment based on the price of fish caught, subsidies for at sea support and subsidies to cover operating losses of vessels or fishing related activities.
The article has further condition that a member may grant or maintain the subsidies set out if it can demonstrate it has policies in place that effectively ensure the stock or stocks are maintained at a sustainable level.
Implications:
—  CC and OC assistance is important for developing countries members to develop the fisheries sector.
—  It therefore discourages investment and joint ventures, domestication of fishing vessels and expanding fisheries sector for food security, livelihood and also economic development. (This is similar to EU proposal of 2017)
—  SDT: the subsidies can be provided if members can demonstrate that it has policies in place to effectively ensure the stock or stocks in relevant fisheries are maintained at a sustainable level. [Refer to EU proposal of 2017 on conditions for SDT which required management plan, stock assessment and other stringent conditions] The policies to demonstrate these can include these list and more and thus links to management with burden on developing countries.
—  For small scale fisheries it is detrimental and constrains policy space for development.
—  Also situation has changed, with COVID-19 and economies moving into recession, these OC and CC are even more relevant to small scale fisheries.
 
LDC and SDT Existing Provision
·       LDCs will transition to developing countries thus in SDT provision it needs to consider exemptions that would also benefit them as developing countries. The transitional period is not sufficient.
·       The special requirements of developing countries in international fisheries agreement provides a list of assistance. By only limiting to transitional period it dilutes existing rights.
·       The TA/CB need to be expanded and also implementation of commitments should be conditional only if sufficient technical assistance is provided. (this has to be footnoted in the text).
 
Conclusion
—  The Special and Differential Treatment (SDT) in the new chairs text has been diluted. The new text has the contentious issues. Only Transition periods are provided. The issues in relation to fisheries management are still in the text.
—  Fish stock assessments, assistance to implement this.
—  Assistance on regulating and reporting is important.
—  Also ensuring policy space for fisheries sector development is impeded and stringent conditions are attached to granting of subsidies for developing countries.
—  For SDT in addition to transitional period it needs to be expanded to include assistance in regulating and reporting. In the ACP text of 2017, a number of areas of technical assistance was highlighted in SDT.
—  Also under international agreements such as UNCLOS, UN Fish stock agreement and other non-binding agreements, the special requirements of developing countries (SDT) are taken into account in developing management measures.
—  Developing countries need to ensure that the SDT is not derailed under the fisheries subsidies negotiations. Transition period is also not enough for members to effectively implement the measures. Developing countries require additional assistance.
—  Also under international agreements such as UNCLOS, UN Fish stock agreement and other non-binding agreements, the special requirements of developing countries (SDT) are taken into account in developing management measures.
Strategic Way Forward
—  Reference point for expanding can be the ACP text of 2017. India has SDT proposal in 2020, perhaps some additions and deletions and expanding the proposal and having a joint developing country sponsorship. India’s proposal only has transition periods as SDT but given the context of the chairs text this is not sufficient.
—  Also international rights of developing countries should not be diluted in fisheries subsidies negotiations.
—  Refer to clauses on Special Requirements of Developing countries in UNCLOS, UN Fish Stock Agreement and other guidelines to formulate SDT.
—  In view of COVID-19 pandemic, as countries are moving into recession, how do we then design fisheries subsidies negotiations?
 
 

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