1. The proposed amendments to the Agreement of the General Fisheries Council for the Mediterranean (GFCM) provide that "Each Member of the Commission (GFCM) undertakes to contribute annually its share of the autonomous budget in accordance with a scale of contributions to be adopted by the Commission" (Article VIII bis, para.1).

 2. It is further proposed (in Article VIII bis, para.3) that:

"(a) The amount of the contribution of each Member of the Commission shall be determined in accordance with a scheme which the Commission shall adopt and amend by consensus.

(b) The scheme adopted or amended by the Commission shall be set out in the Financial Regulations of the Commission."

 3. The FAO Secretariat has prepared the present document taking fully into account the various recommendations made at the Twenty-first Session of GFCM and at the Workshop on the Legal and Technical Aspects of Fisheries Management in the Mediterranean, held at Montpellier from 21 to 25 April 1997.

 4. There are two basic principles in calculating contributions to GFCM, for which most Members have expressed their support. The first principle is that the contribution should be shared to the extent by which Members receive economic benefit out of fisheries in the Mediterranean. The second is that the level of economic development of Members should be taken into account.

 5. Consideration could also be given to a formula which would facilitate cost-sharing among GFCM Member countries and the European Community (EC), which has now applied to become a Member of GFCM.

 6. In order to avoid double counting, the same formula cannot be applied to EC and to GFCM Member countries which are also members of EC. A possibility is to differentiate between the contribution of EC and that of EC members could be 1) for all Member countries, including those countries which are also members of EC to share the staff costs including consultants costs; 2) for EC to cover all the non-staff costs based on the approved biennium programme (including FAO servicing costs).¹

 7. The total formula indicating the amount of contribution may be divided into these two elements based on the programme of work and budget (see Annex I). However, the budget for 1998 has been decreased by half based on the assumption that at least six months would be required to undertake the necessary preparatory activities, including recruitment of staff (see Annexes II and III).

 8. The total contribution to staff costs could be subdivided into the following three components:

i) A basic fee, identical for all members

It is proposed that each Member State should pay a fixed amount of US$ 5 000/year irrespective of both fisheries and economic status;

ii) A component based on economic development parameters

In 1995 World Bank categorizes economic development by utilizing GNP per caput into:

(a) high income economies (US$ over 9386
(b) upper middle income economies (US$ 3036 - 9385);
(c) low middle income economies (US$ 766 - 3035);
(d) low income economies (US$ below 765).

It is proposed that the average values of Member countries�s GNP per caput in each category are divided by 1,000 and these figures are used to represent each Member country�s status for the economic development as follows:

High income economies	22
Upper middle income economies	6
Low middle income economies	2
Low income economies	0

iii) A component proportional to catches

There is no objective ways of accurately assessing the economic benefits which Members desire from fisheries. One of the best methods appears to be to use values of the landed fishery products. It is thus proposed to use for calculation the percentage of contribution for each Member country to the total value of fisheries products in the Mediterranean (excluding the Black Sea).

iv) For these coastal countries where fisheries contribute less than 1% of total value of Mediterranean catches, however, it would be appropriate to reduce the economic development component to that of low-middle income countries (e.g. although Monaco has a high-income economy, its contribution of 22 is devaluated to 2 because the value of the catch is estimated at only US$ 4 000 (0.00007 percent). (see Annex IV).

9. The Council is invited to consider the basic scheme and the elements proposed for the calculation of contributions and to decide on an acceptable formula.