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Russia threatens to call on WTO after Mauritania says it should respect same conditions as "subsidised EU fleets"

01 July 2013

Since joining the World Trade Organization last year, Russia has threatened to file its first complaint under WTO rules about the subsidies that Russia claims are provided by the EU – under the FPA – to its fishing fleets operating in Mauritania. According to Russia’s Federal Fisheries Agency’s deputy director Andreï Kraïni, the EU “pays Mauritania 80 million euros per year so that EU companies have the right to catch 300,000 tons of fish in its EEZ [exclusive economic zones]. This level of subsidies makes fishing by Russian and other non-EU companies unprofitable”.

Russia’s threat comes at a time when it is also negotiating an access agreement with Mauritania for its fleets, to catch small pelagics. Although no official information has publicly been made available, a Mauritanian newspaper, Le Calame, obtained the draft agreement being discussed, which proposes a 10-year access agreement for Russian vessels, against a payment of US$100 million, to be invested in storage and processing infrastructure.

However, the Mauritanian government insisted that Russian vessels should have the same technical and financial conditions as apply to EU vessels. These conditions applying to EU vessels fishing for small pelagics under the FPA include a rise in ship owner’s payments, as well as a redefinition of the fishing zone, which puts sardinella resources – deemed over-exploited – out of reach of EU vessels. This move was welcomed by local artisanal fishermen, who insisted that sardinella is key for local and regional food security.

Faced with this demand, Russian negotiators stated that unlike the EU, Russia does not grant subsidies to its ship owners. Therefore the economic indicators show that the Russian fleet cannot work under as strict technical conditions as imposed on EU vessels, which prompted Russia to announce its initiative at the WTO.

Replying to the announcement, European Fisheries Commissioner Maria Damanaki underlined that: “Our fisheries agreements are based on transparency, sustainability and good governance. Everybody can see the terms of our agreements. This is not the case always with our international partners. Any move against our agreements [at the WTO] would serve as a catalyst for more transparency in fisheries agreements involving others.”

In recent years, West African small pelagics have become the target of various foreign fleets, including China, the EU and Russia. In 2012, Senegalese fishermen and Greenpeace denounced the illegal licensing by the former Senegalese government of giant trawlers plundering their small pelagic resources. The trawlers are mainly flagged in Russia and East European countries or hiding behind flags of convenience, including ACP countries such as Belize or Comoros.

Editorial comment

There are two main variables regarding the access of foreign fleets to ACP fish resources: technical conditions and financial conditions of access. The question raised by Russia about the financial conditions in the EU–Mauritania access agreement – so that financial conditions offered to Russia “compensate” for what it considers “competition distorting subsidies” – highlights that technical conditions of access – the other variable of access agreements – should not change. Technical conditions negotiated by Mauritania with the EU for access to small pelagics were based on the need, expressed by Mauritania, to conserve these resources and protect its local artisanal fishing sector. It seems logical that, to achieve this objective, Mauritania should insist that the same technical conditions apply to all other foreign fleets.

If Russia’s threat translates into a formal complaint under WTO rules, then it will be a test case on fisheries’ subsidies and access agreements. During the long litigation process at WTO, including the consultations that will take place between the parties, it is likely that information will be made public about Russia and other non-EU fleet agreements, and how they compare with EU agreements. Until now, most access agreements have been rather opaque, and such disclosure in itself would be a step toward more transparency in distant water fishing nations’ access to ACP resources.

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