Subsidies Contributing to Overcapacity and Overfishing: The Challenges in Completing the Third Pillar of the WTO Fisheries Agreement

The Fisheries Subsidies Agreement (hereinafter “FSA”) reached at the 12th Ministerial Conference of the World Trade Organization (WTO) marked a historic achievement in furthering agenda 14.6 of the United Nations Sustainable Development Goals (UNSDGs). The text of the FSA prohibits subsidies for the following fishing or fishing related activities: subsidies for illegal, unreported or unregulated (IUU) fishing, fishing targeting overfished stocks, and; fishing in the unregulated high seas. However, the FSA as it stands today is not a comprehensive agreement in itself. Article 12 of the FSA mandates the adoption of comprehensive disciplines within four years of entry into force of the Agreement failing which the Agreement could terminate. While the additional pillar under the FSA seeks to discipline subsidies that can lead to overcapacity and/or overfishing (hereinafter “OCOF”) and thereby encourages sustainable fishing, disciplines on this pillar can potentially curtail the ability of countries that are still not part of the Regional Fisheries Management Organisations/Arrangements (RFMOs/As) and countries not involved in Distant Water Fishing (DWF) to realize their fishing capabilities. In addition, developments on OCOF can also have implications on the income and livelihood security of fishermen in several developing and least developed countries. Given these sensitivities, the article examines how the third pillar on OCOF can achieve ocean sustainability, and importantly sustainable fisheries, while not impairing the ability of the people who depend on the oceans for their livelihood and income security.