When are fish subsidies harmful? A traffic light approach David Vivas Eugui, Legal Officer, TED/DITC, UNCTAD

Setting the course…. What do the WTO and UN mandates tell us? What was listed a potentially subject to prohibition in the WTO Rules Chair Draft of 2007? Quick overview of main components of the 2016- 2017 WTO Member States Proposals Testing a "traffic light approach" on fish subsidies? Red light Yellow light Green light

What do the WTO and UN mandates tell us? WTO Hong Kong Ministerial: "(…) disciplines on subsidies in the fisheries sector, including through the prohibition of certain forms of fisheries subsidies that contribute to overcapacity and over-fishing (..)", SDG 14 "(…)By 2020 prohibit certain forms of fisheries subsidies which contribute to overcapacity and overfishing, eliminate subsidies that contribute to illegal, unreported and unregulated (IIU) fishing (…)" UNCTAD Mafiakiano " (…) analysis of fisheries subsidies that lead to overcapacity and overfishing and subsidies that contribute to illegal, unreported and unregulated fishing and the challenges they pose to developing countries, particularly in connection with the conservation of marine resources and food security"

Additionally there was a prohibition to: What was listed a potentially subject to prohibition in the WTO Rules Chair Draft of 2007? The focus was on subsidies that directly affect fishing and related activities: Acquisition, construction of vessels Operating costs Income and price supports Port infrastructure predominantly for fishing and related activities Onward transfer of access rights to fisheries within the jurisdiction of another Member Transfer of access rights IUU fishing Additionally there was a prohibition to: "benefits" of which are conferred on any fishing vessel or fishing activity "affecting fish stocks that are in an unequivocally overfished" condition shall be prohibited

2016-2017 WTO Member States Proposals Scope SDG 14.6 Marine resources Some proposed carve outs Non-specific subsidies Areas beyond national jurisdiction (ABNJ) Aquaculture List of prohibitions Subsidies to IUU (activity + impact) Subsidies that contribute to overfishing (impact) Subsidies that contribute to overcapacity (level of fishing effort) List of exemptions Positive list of subsidies that do not contribute to overfishing (EU proposal) Horizontal exceptions S&DT options

Most harmful Fish subsidies (Potential RED LIGHT box) IUU fishing (activity + impact) States should not be using public resources to fund illegal activities IUU fishing is estimated to be about 10% of all capture It brings illegally harvested and fraudulent products into markets It may not pay taxes May be links to other criminal activities (slave labor, smuggling and drugs dealing) Overfishing (impact based) 31% of stocks below sustainability levels (FAO 2016) It breaches fish management systems and internal and regional quotas Undermines future of fishers and livelihoods Fuel subsidies (input based) Most important operational cost (e.g. in interviews carried out by UNCTAD with fleets owners, it may account 70-80% of expedition cost in the tuna sector) Contradictory with environmental policies (it generates emissions and pollutes the environment) Without fuel subsidies long distant fishing will not be economically feasible Distort prices, trade and generate emissions The issue of specificity Acquisition, construction of vessels Other operation costs Income and price supports Generate over capacity Can contribute to overfishing Distort prices and trade Ships can be sold and transferred passing on the problem Do not provide a long term solution to the fishers and to coastal livelihoods

Fish subsidies with mixed effets (Potential YELLOW LIGHT Box) Port infrastructure predominantly for fishing and related activities Increases landing and stocking capacity The issue of specificity Subsidies and small-scale commercial (artisanal) fishing are allowed Provided there are adequate and proportional stocks management measures Difficulties in finding definitions or criteria Onward transfer of access rights to fisheries within the jurisdiction of another Member If Member to Member, not consider a subsidy Provided no overfishing Introduction of energy efficient/low emission engines in existing vessels May increase or sustain capacity but reduces emissions and fuel consumption Fish subsidies with positive effets (Potential GREEN LIGHT Box) Compliance with food security, environmental and social sustainability instruments (i.e. FAO, ILO, UNEP, etc.) Creation and strengthening of fish management systems Ships decomissioning Safety and labour protection of the crew Shift in Economic activities Marine R&D Sustainable aquaculture

Many thanks "the only problem with nature is human nature…" For more information, see: http://unctad.org/en/Pages/DITC/Trade-and-Environment/Oceans-Economy.aspx