WORLD TRADE
ORGANIZATIONWT/CTE/W/173
23 October 2000
(00-4380)
Committee on Trade and Environment Original:  English
JAPAN’S BASIC POSITION ON THE FISHERY SUBSIDY ISSUE
Item 6
Submission by Japan
I. INTRODUCTION
1. Japan submitted a paper titled "Comments on the Fisheries Subsidies proposal submitted
jointly by Australia, Iceland, New Zealand, Norway, Peru, Philippines and the United States" to the
WTO in September last year.  Once again, we would like to present our basic position on this issue aswell as comments on the US paper (WT/CTE/W/154) tabled at the July 2000 CTE meeting.
B. B
ASIC POSITION
2. The CTE is a forum to discuss broad issues related to trade and environment.  In the field of
fisheries, it should discuss, in a broad manner, the relationship between sustainable use of fishery
resources and trade in fish and fishery products.  Possible adverse effects of fishery subsidies onsustainable use could be one of the topics that the CTE can take up.
3. As we pointed out in our paper in September 1999, we are not aware of any specific case in
which fishery subsidies were a major cause of stock depletion.  Despite our repeated requests,
Member countries that advocate negative effects of fishery subsidies have shown no such single case
up until now.
4. On the contrary, as in the case of toothfish in the Antarctic Ocean and cod in the Northwest
Atlantic Ocean described in our previous paper, it is possible to show fish stocks being depleted dueto factors other than fishery subsidies (e.g., lack of adequate fishery management including
insufficient measures against illegal, unrepo rted and unregulated (I UU) fishing activities).
5. We have a serious concern about an approach of trying to reach a conclusion without concrete
examples of problems since such an approach could become a bad precedent and have a negative
influence on discussion not only in the WTO but also other international organizations.
6. Many factors are likely to cause depletion of fishery resources.  Examples are inadequate
management of fishery resources, IUU activities including those conducted by flag-of-convenience
fishing vessels and so on.  Just singling out the issue of fishery subsidies and taking measures on the
subsidies would not be sufficient.  In order to achieve a fundamental solution to over-exploitation of
fish stocks, it is essential that FAO, a UN specialized agency for fisheries, will continue to address allthe possible negative factors to sustainable use of resources.  The fishery subsidy issue should be
handled in this process.
7. It would be wise to utilize expertise on fishery management that FAO can provide, given
limited amount of human resources available on this subject in the CTE and member countries,
especially developing ones at the CTE.  It would not be a balanced approach if the CTE should pickWT/CTE/W/173
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up only the fishery subsidy issue and give an in-depth analysis thereon.  The CTE is expected to
consider the relationship between fishery resources and trade and to examine in a comprehensive
manner what kind of contribution it can make for sustainable use of fishery resources.
C. COMMENTS ON THE U.S. PAPER
1. General comments
8. It should be made clear as to why the U.S. paper gives special consideration only to fishery
subsidies when the Agreement on Subsidies and C ountervailing Measures (SCM) covers all the
subsidies basically other than agricultural subsidies.  We feel that the reason is that the fishing
industry utilizes fishery resources, i.e., renewable but exhaustible natural resources that could be
depleted without proper management.  We anticipate  that the same consideration will be given when
discussing fishery trade issues including relationship between trade and sustainable use of fishery
resources.
9. The results of the recent OECD study on fishery subsidies should be fully taken into account
when dealing with fishery subsidies in terms of over-exploitation aspects.  As the study clearly states,
possible negative effects of fishery subsidies can be minimized if appropriate management and
conservation measures are taken.  Therefore, rather than just pointing out which subsidies are good orbad, we should examine, on a case-by-case basis, under what circumstances a certain subsidy actually
produces negative impacts on fishery resources.
10. If the US would like to categorize fishery subsidies into those having adverse impacts on
resources under inadequate management and those not, Japan does not necessarily object to suchwork.  However, we should not expect the WTO, which focuses its discussion on international trade
issues, to provide a good forum to conduct such a technical work related to fishery.  This issue should
be addressed by experts on fishery and fishery resource management.  Therefore, the CTE should
request FAO to conduct the work and feed back the results to the CTE.  The CTE then would be able
to conduct further analysis on fishery subsidies based on the work of FAO.
11. The U.S. paper divides cost- and capital-reducing subsidies into those affecting domestic
fisheries and those affecting international fisheries.  Subsidies in both categories are considered to
cause over-exploitation in the paper.  Such subsidies should be discussed under the FAO International
Plan of Action for the Management of  Fishing Capacity.
12. We recognize that the main driving force for the current fishery subsidy argument is the
concern that certain fishery subsidies seem to have negative effects on sustainable use of resources.
We agree that this concern is not appropriately addressed by the SCM Agreement.  The U.S. paper
also covers negative effects of fishery subsidies on fishery trade, but as long as such negative effects
fall within the meaning of “adverse effects” stipulated in Article 5 of the SCM Agreement, these
subsidies can be dealt with by the SCM Agreement.  However, the fishery subsidy argument consistsof a variety of factors, and among others, particular attention should be given to resource
sustainability aspects at the CTE.
13. In the event that the United States also wishes  to discuss adverse impacts of fishery subsidies
on fishery trade, we would like to hear an explanation on what type of subsidies, out of fisherysubsidies having adverse impacts on fishery trade, cannot be addressed by the SCM Agreement.WT/CTE/W/173
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2. Comments on specific paragraphs
14. 3rd paragraph:
The FAO International Plan of Action for the Management of Fishing Capacity requires
members to reduce and progressively eliminate not only subsidies that have negative impacts on theenvironment, but also all factors undermining sustainability of marine resources.  It should be noted
that in implementing the Plan of Action due regard s hould be given to the needs of artisanal fisheries
(small-scale coastal fisheries).
15. 9th paragraph:
It is not clear what regulated open access fisheries mean.  If a certain fishery is well regulated
in terms of input (capacity limitation on each vessel under a limited entry system) and output (total
allowable catch), we would like to know how and what subsidy would negatively impact resources.
16. 11th and 12th paragraphs:
The problem of “spillover” is a good example wh ich can show that the core issue is how to
use subsidies under what fishery management measures, rather than which subsidy to use.  That is,
subsidies for vessel reduction, which are normally considered positive, are likely to cause another
problem if the vessels which no longer can engage in a certain fishery under the vessel reduction
programme move to another fishery (e.g. moving to another fishing area, change to another species,etc.).  When implementing vessel reduction programmes, the government should not only stop vessels
engaging in the fishery, but also scrap the vessels so that the vessels cannot be converted to fishing
vessels for other fisheries.
17. From 18th to 26th, and 28th paragraphs:
Fishery subsidy argument cannot be separate d from fishery management.  The CTE should
request FAO to investigate which subsidies could be good or neutral under good management
schemes, and which subsidies could be bad under bad management schemes, and to feed back the
results of the investigation to the CTE.
18. 27th paragraph:
It seems that subsidies listed here virtually mean export subsidies.  Export subsidies are
explicitly prohibited by the SCM Agreement.  There is no need to create a new discipline for such
subsidies.  We would like to seek explanation about the reason for making this type of subsidies
subject for consideration.
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