NEGOTIATING GROUP ON RULES - FISHERIES SUBSIDIES

Report by the Chair, H.E. Mr Einar Gunnarsson to
the trade negotiations committee

12 December 2024

Thank you, Director-General, and good morning colleagues.

Today, I will report on the developments in the Negotiating Group on Rules (NGR) since the meeting of the Trade Negotiations Committee (TNC) that took place on 15 July 2024.

Members will recall that prior to that meeting, on 10 July, I had circulated, under my responsibility as Chair of the NGR, a draft text of the Additional Provisions on Fisheries Subsidies in document _TN/RL/W/279 (document W/279). Shortly thereafter, and on my advice, Iceland placed this draft text and two accompanying draft decisions onto the agenda of the General Council (GC) meeting of 22-23 July, for "decision".

On 11 July, India inscribed three papers onto the agenda of the GC meeting for "discussion", circulated as documents symbolled _WT/GC/W/945, _WT/GC/W/946, and _WT/GC/W/947. In these documents, India raised fundamental issues and concerns that would require substantial restructuring or would roll back the key compromises made at MC13, which were essential elements of the considerable convergence that was achieved then. It also called into question the negotiating mandate given to us by Ministers at MC12, and even sought to reopen the Fish 1 Agreement.

At the TNC meeting of 15 July, the vast majority of Members' interventions revealed that there was broad support for concluding the negotiations on the basis of document W/279, and provided valuable insights into the remaining gaps and areas where many Members believed further progress was required to reach consensus by the July GC. However, at least one Member's statement clearly indicated that it would not be in a position to conclude on the basis of W/279 without substantial changes in approach.

In the days that followed, a remarkable amount of work was done in small groups to narrow some of the differences and explore possible landing zones. Discussions were open, constructive, and productive. Many Members moved beyond their long-standing negotiating positions and showed a willingness to compromise with a view to finding creative solutions to several key issues. These included but were not limited to: (i) the transition period for LDC Members and related provisions on the peace clause; (ii) the role and formulation of footnote 23 on artisanal and small‑scale fishing; and (iii) the interplay between sub‑paragraphs (a) and (b) in Article A.2 on distant water fishing.

Nevertheless, despite this significant progress, it became clear to me at that time that a consensus on a revised version of document W/279 could not be achieved at the July GC. Accordingly, I advised Iceland to move the draft text and accompanying decisions on the Additional Provisions on Fisheries Subsidies from a "decision" item on the agenda of the GC to a "discussion" item. At that GC meeting, I urged Members to use the summer break to reflect on these latest developments and to work on securing the necessary political will to bring our negotiations to a successful conclusion.

This fall, I resumed NGR activities at the end of October to hear Members' latest reflections and views on the way forward. Between 28 October and 11 November, I altogether held 28 bilateral meetings with individual Members and Group representatives covering a wide spectrum of the Membership. Subsequently, I called an open-ended NGR plenary on 19 November to report on those consultations and to provide Members with an opportunity to exchange views on whether a decision on the Additional Provisions on Fisheries Subsidies should be inscribed onto the agenda of the December GC.

While the overwhelming majority of Members that spoke at the November NGR plenary called for the conclusion of the negotiations in December, a few Members advised against pushing for the December GC. At least two of these Members reiterated their position that they needed to see substantial changes to several different parts of document W/279 to be able to join consensus.

On 29 November, I circulated a revised text of the Additional Provisions in document _TN/RL/W/285 (document W/285) with an accompanying addendum and informed Members that I would once again request Iceland to inscribe the Additional Provisions on Fisheries Subsidies onto the agenda of the December GC for "decision". Document W/285 contained the three changes that we had identified in July and removed the numbers for the two transition periods in Articles B.1 and B.3 to acknowledge that further engagement from Members is needed on them.

Following the circulation of document W/285, I convened three in-person small group meetings on 4 December, calling on Members to share their holistic assessment of the document, as well as their views on the possible next steps before the December GC. Any Member that wished to participate was accommodated in one of the three meetings, and all Members were able to listen in on each of the meetings via Interprefy.

On 5 December, Iceland at my request inscribed the draft text in document W/285 and the two accompanying draft decisions onto the agenda of the December GC for "decision". As in July, the first draft decision concerns the adoption of the Additional Provisions themselves, and the second draft decision concerns Members' notifications of annual aggregate levels of fisheries subsidies.

India also inscribed onto the agenda of the December GC for "discussion" the three papers previously discussed at the July GC, as well as one additional paper, circulated as document _WT/GC/W/958, proposing to introduce the notion of subsidy intensity into the draft text of the Additional Provisions.

On Saturday, 7 December, as I described in a subsequent communication to Members, I met with a small group of Members to discuss the overall balance in document W/285 and the way forward. Members had a frank and open exchange of views, which included discussing the overall approach underlying the draft OCOF disciplines. Many Members noted that the draft text did not fully address all their interests and needs. However, they recognized that it is the product of years of negotiations in which all Members' positions have been tried and tested. Therefore, they see document W/285, with some final tweaks and adjustments, as allowing us to bring our negotiations to a conclusion. In this context, several Members reflected on the consequences for fish stock sustainability if Members fail to reach consensus now, noting that it was difficult for them to see a viable alternative way forward.

For at least two Members, however, document W/285 falls far short of an acceptable outcome and is not appropriately balanced. These Members stated forcefully that they would need considerable substantial changes to document W/285 in order to be able to join consensus. However, as I have said before, one Member's balance may be another Member's imbalance.

After the meeting on Saturday, it was obvious that further engagement in small groups on other issues would be futile unless there was some kind of a breakthrough on these more fundamental questions of the overall balance of document W/285. I therefore decided to prioritise to consult with some of the key stakeholders while also encouraging Members to continue to meet with each other in order to narrow their differences. I know that Members have done exactly that, and I want to thank all those that have been actively engaged with me or with each other.

Now, let me give you my honest account of where we are today.

Since July, I have continuously observed that the vast majority of Members is willing to conclude the negotiations on the basis of the existing draft text – be it on the basis of document W/279 or document W/285 – either as it is or with some limited tweaks and adjustments. For these Members, the disciplines thus far negotiated strike a delicate balance among many conflicting interests and are the product of hard-won compromises over years of discussions. Most of these Members feel strongly that, while not ideal or perfect, the disciplines would significantly improve from the status quo, in which there are no disciplines at all in place to regulate subsidies contributing to overcapacity and overfishing and where we continue to see a steady and rapid deterioration of fish stocks around the world.

However, at least two Members have continuously maintained that significant imbalances remain in the draft text and that substantial changes would be required for them to join consensus. These two Members continue to seek more material amendments to the text, calling for a fundamentally different approach, as elaborated, for example, in India's four papers circulated in documents _WT/GC/W/945, _WT/GC/W/946, _WT/GC/W/947, and _WT/GC/W/958.

As I have said before, I truly believe that the absence of progress on the approaches identified in these papers is not due to the lack of engagement by the Membership. These issues have been subject to repeated and detailed discussions among Members throughout the negotiations. Many Members have been sympathetic or outright supportive of various key elements in these papers. However, most of these Members do not realistically see how those ideas could reach consensus, and seem to have concluded that document W/285 represents the best chance of success.

Let me reiterate that I believe that these calls for substantial changes have been very well explained by their proponents and are well understood by the rest of the Membership. This is further illustrated by the timeline of our negotiating process since MC12 that I circulated in document _RD/TN/RL/193, and which I will update and recirculate after the GC next week.

Therefore, at this juncture, I cannot see or detect any signal that will allow me to issue a written revision of document W/285 that could pave the way to its actual adoption along with the two decisions inscribed for the GC meeting come next Monday. But you can of course still prove me wrong through your interventions in this meeting, and on this occasion, I would absolutely love to be proven wrong.

So, in short, save for any last-minute solution, it seems to me that, as one Member has put it, the negotiations have reached a stalemate even though nearly all Members can support the current text as a basis for conclusion. The balancing measures so strongly requested by a couple of Members would clearly unbalance the text for a large group of Members.

At this point, it is not obvious to me how Members might want to take the negotiations forward, and we need to reflect over what viable alternatives we have.

As always, I will be listening very carefully to your interventions here today.

I thank you.

__________