CFP Reform: Commission ‘Non-papers’

Regionalisation, transferable fishing concessions, a discard ban and a CFP based on maximum sustainable yield are central components in the Commission’s proposals, and yet are all subject to varied and contested interpretations. It is useful therefore to have some background explanation to the thinking behind them.

Our comments on the four non-papers are detailed below.

Regionalisation

We have been amongst the strongest and earliest advocates of a regionalised and decentralised CFP. Our view is that the primary reason why the CFP has consistently delivered much less than promised over its lifetime has been because of its reliance on an unwieldy, unresponsive and over-centralised command and control approach to resource management. This has led to blunt, one-size-fits-all measures across many diverse fisheries and fleets. As a result many of the measures adopted have failed and have not been supported by the principle stakeholders. This point is now well understood and featured heavily in the CFP Reform Green Paper.

The Green paper, and subsequently the Commission’s CFP Proposals, advanced regionalisation of decision-making as the central means of making the CFP more responsive, relevant and effective by bringing management decisions closer to the fisheries concerned.

The explanation now outlined in the Commission non-paper confirms however, that what is envisaged is a minimalist version of a regionalised decision making process. This is a disappointment and carries great significance for the reform.

It is understandable and reasonable to expect that the EU co-legislators (Commission, Council and Parliament) should retain ultimate responsibility for setting the standards, principles and objectives for the Common Fisheries Policy. Likewise, we agree that the Commission should retain authority to intervene when delegated management has failed for some reason. However, going beyond this to retain responsibility to set specific management goals and time-frames for long-term management plans at European level, and restricting the role for member states at regional level to supplying different means of implementing these decisions, is not, to our view, to encourage genuine independent agency at the regional level. This would be to waste the potential that is available within a genuine regional approach.

Although the jurisprudence remains contested, it may be true that there are currently only two legal alternatives to a protracted co-decision process to give regulatory effect to decisions on, for example , long term management plans arrived at through regional-seas cooperation:

Providing the Commission with additional delegated powers (within a set of safeguards),
The potentially chaotic route of individual member states using their national legislation to give effect to a regionally agreed policy

Nevertheless, this is a very long way from our vision of delegated responsibilities, with a significant degree of autonomy, to the regional level and below.

Likewise, the example given of a framework regulation for technical measures is a kind of hesitant half-step towards regionalisation that would be a recipe for repeating the failures, complexity and perversities of the current technical conservation regulation but with the single difference that the opprobrium for failure would rest with the member states rather than with the Commission and Council of Ministers. The parallels with the current EU Cod Management plan are too clear to miss: responsibility for achieving unachievable and un-measurable objectives, within an unrealistic time framework is set at European level – but responsibility for implementation transferred to the member states under the heading and rubric of “flexibility”. This is not a blueprint for an effective or happy management regime.

Legal uncertainty remains over whether the Treaty in fact proscribes delegation of decision-making authority to a decision-making body comprised of relevant member states at regional seas level.

What should not be in dispute, however, is that for shared-stock demersal fisheries regional-seas decision-making with a high degree of involvement by the principal stakeholders is the governance framework that is most likely to be consistent with effective fisheries management. In terms of understanding of the specific characteristics of the fisheries concerned, an ability to adapt rapidly to changing circumstances, short communication chains, strong cooperation between fisheries managers, fisheries scientists, fishermen and other stakeholders and dealing with the realities of shared stocks, there is no superior model.

It is disappointing that the non-paper suggests that what will emerge from the 2012 reform will fall far short of this.

Transferable Fishing Concessions

The non-paper makes clear that the Commission’s rationale for embracing transferable fishing concessions is that the CFP has failed to deal with the problem of fleet overcapacity. The Commission believes that:

None of the past policies to tackle overcapacity (multi-annual Guidance Programmes, entry-exit ratios, capping the maximum fleet size, public scrapping schemes) have worked
A mandatory system of TFCs, properly designed, applied at member state level will address the problem of overcapacity without further public intervention and equally as important, without further expenditure of public funds

The Commission appears as confident in its view of past policy failures as it is now about having identified a panacea to overcapacity in the form of TFCs.

We are less convinced of both propositions. In fact a closer examination of the evidence suggests that whether TFCs or publically funded scrapping schemes are employed to reduce fleet capacity, the design of the scheme is the critical factor which determines success or failure. It is both simplistic and factually untrue to dismiss all publically funded vessel decommissioning schemes as having failed to reduce capacity. Both the Commission and the European Court of Auditors are guilty of over-generalisation in their assessment of what has been achieved through decommissioning part-funded by FIFG and EFF. A broad EU overview is probably correct in concluding that a lot of public money has been spent but that an overcapacity problem remains in the EU. However, by failing to distinguish between successful and unsuccessful decommissioning schemes at fisheries level, the Commission and ECA miss the central point: some decommissioning schemes have been very successful whilst others have been comprehensive failures. We would suggest that the following fisheries have benefitted greatly in terms of reduced fleet capacity, reduced fishing mortality and increased profitability as a direct result of public intervention through decommissioning:

North Sea cod
North Sea roundfish stocks
North Sea plaice
North Sea sole
Celtic Sea demersal stocks, especially cod

In the same way that publically funded decommissioning has been dismissed in the non-paper as having failed to deliver, the Commission expresses a rather naïve faith that TFCs will deliver the desired results. This faith may be misplaced because much depends on the context in which TFCs are applied and the design of the TFC arrangements in the member states themselves. Most reasonable observers would agree that the system of TFCs in Denmark has been successful but it is worth noting that the Danish scheme was preceded by several rounds of publically funded decommissioning and that the preconditions for TFCs may not be the same in all member states. In other member states where variants of TFCs are in use it is not yet possible to arrive at definitive conclusions about the relationship between TFCs and effective reduction of overcapacity.

The Commission envisages that the mandatory system of TFCs applied within each member state would be subject to five strict principles:

TFCs will not confer property rights, but only user rights to exploit them for a limited period. After expiry of that period the TFC will revert to the member state which would then be free to reallocate it using the same or different criteria
Selling, leasing or swapping of TFCs will be limited to owners of registered and active fishing vessels and will only take place with the purpose of transferring them to the vessels which will use them
Relative Stability will be respected
Member states would withdraw TFCs in the case of any serious infringements
Member states would be obliged to reserve quotas and TFCs for new entrants to the fishery

Whilst the proposal foresees that member states would have flexibility, the Commission’s preference is that member states should allocate a certain % share of the national quotas to the small-scale fleet. The Commission envisages additional safeguards for the small scale fleet, specifically their exemption from TFCs if they use passive gear. The Commission draws heavily on the Danish experience in its advocacy of a TFC system in all member states.

In response:

We freely acknowledge that within a well designed administrative framework and with certain important preconditions TFCs can be an effective way to manage national quotas. The advantage of a system of rights-based management lies in the security and encouragement of longer-term planning that it provides , along with its discouragement of ‘Olympic fishing”, otherwise known as the ‘race for fish’.
We consider, however, that it is a moot point whether the Commission has legal competence in this area, given that to date quota management has been a competence that has resided with the member states
Across the EU and within individual member states a mix of TFCs, pooled quotas, delegated responsibilities and centralised quota limits are currently in use, depending on local adaptations to specific circumstances. The evolution of this complex pattern has largely taken place under member state oversight without involvement or intervention by Brussels and usually in an incremental and organic way after much discussion at member state and local level. The central question must be whether these arrangements within each member state are likely to be enhanced or degraded through centralised controls of the type envisaged. Our view is that we are unlikely to achieve a more effective system of quota management by applying a command and control approach at the European level where it has not existed previously. Removing member state autonomy in this area would in our view be a retrograde step.
We have elsewhere indicated the folly of searching for a single definition to differentiate small-scale fleets at European level because of the diversity of the fleets and operational realities around the coast. We would also draw attention to the often unforeseen consequences of drawing a more or less arbitrary line through the fleets with substantially different regulatory conditions on either side of that line. A definition which differentiates between under-12 metre vessels using passive gear and the rest is as inadequate a definition as any other. The fact that this will ultimately be a member state area of responsibility provides some assurance that the worst excesses will be avoided. The non-paper makes no mention of other kinds of safeguards for the small-scale fleet, such as a ‘one-way valve’ applied to quota transactions involving the small scale fleet that could be applied by those member states which include this class of vessel (however defined) in TFC arrangements.
An important legal question relates to the Treaty’s strictures on EU competence where property rights within a member state are concerned. The Commission may consider that a TFC is a use-right rather than a property right but the legal precept of legitimate expectation after many years of custom and practice may lead the courts in the member states, and ultimately the European Court of Justice, to a different conclusion.

In summary, whilst we believe that there is a place for TFCs in those member states which want them, we think that it is wrong in principle for the Commission to propose a mandatory system on all member states. Furthermore, we question whether, even if the EU has the legal authority to impose TFCs within member states, it is desirable or consistent of them to do so within the context of efforts to decentralise the CFP and to delegate more responsibility to the member states and the fishing industry.

CFP Reform – the discard ban

The Commission acknowledges that fishermen across Europe have undertaken a number of good initiatives to reduce discards but considers that these are insufficient to assuage public concern about what it describes as “this wasteful practice”. It has therefore proposed a ban within a “gradual approach in three stages: pelagic species in 2014, most valuable demersal species (cod, hake and sole) in 2015 and other species in 2016.”

The non-paper moves directly to explain how, in the Commission’s view, a discard ban would work in practice. This would involve fishermen and administrations working hand in hand within a regionalised CFP to develop concrete measures to avoid unwanted catches. This could include inter alia:

More selective gear
Restricting access to juvenile aggregation areas
Real time closures
Administrative redistribution of quota to cover catches
Pooling of quotas
Use of TFCs to match fishing opportunities to capacity
Greater use of international quota swaps and transfers
Inter PO quota swaps
Establishment of “by-catch quotas” through which a % of the national allocation will be reserved to cover fish landed that are not covered by individual quotas
Banking and borrowing of quota
EMFF funded storage aid and marketing initiatives
Fish caught below a (regionalised) minimum reference size would have to be landed but only sold for fish meal or pet food

Four points readily occur when reading this list:

The first is the extent to which many of these measures are already in practice as part of the normal business of quota and fisheries management by POs and member states
The extent to which the Commission is silent on substantial discarding that is directly related to CFP regulations and CFP management decisions including TAC decisions. This is a very significant omission. Without substantial change to the catch composition rules within the Technical Conservation Regulation and an entirely different approach to setting TACs within mixed fisheries, the Commission’s Proposal for a discard ban cannot work in practice
The superficial glossing over of the issues involved in administrative redistribution of quota. This is an area fraught with legal and ethical difficulties (and it is only because this is seen from a comfortable distance and it would not be their responsibility) that the Commission can suggest it so blithely
Interestingly, the non-papers do not mention catch quotas. At present the catch quota projects are at the cutting edge of discard reduction. Using the potential in the tonnages currently listed under the ICES advice discard column, catch quotas have demonstrably motivated behavioural change to reduce discards (and to document that change through the use of CCTV cameras). Catch Quotas have their disadvantages and are certainly not the panacea for all fisheries and fleets but they seems positively superior to Norway’s notional “ban” where ICES estimates that there is still a discard rate of around 15%. We would like encouragement for the expansion of the voluntary catch quota scheme but would be opposed to regarding it as any kind of panacea to be imposed on the fleets in a blanket fashion. Ultimately such an approach would only be counter-productive.

We have already indicated that we share the Commission’s goal of ending large-scale discarding. We agree that discarding wastes the resource and mars the reputation of the fishing industry, although it is always important to locate the issue of discarding within the bigger picture of effective resource management where the mortality rate rather that the end-use is the critical question.

It is worth repeating that substantial progress has already been made in reducing discards and these initiatives have been notified to the Commission. At the same time we are uneasy about applying the word “ban” to the efforts to minimise discards. Although a “ban” plays well with those parts of the media which have focused on the discards issue, the most superficial enquiry will reveal that even in those countries like Norway which ostensibly have a ban on discards, this prohibition is necessarily far from absolute. Unless the aim is to close mixed fisheries down completely and immediately, the practicalities and realities of fishing have to be taken into account.

The non-paper confirms that it is the Commission’s intention to provide some flexibility through a phased approach to the ban by allowing fish with known high survival rates to be returned to the sea. Even accepting that in a regionalised system implementing decisions would be made at the level of the fishery, the non-paper provides little additional illumination about how the necessary flexibility would be applied in practice and how necessary derogations would apply in arrangements still dictated to a large degree from the centre.

Successful management through the delegation of responsibilities will be dependent on achieving a workable balance between a broad management framework and flexibility for the member states and industry organisations to take initiatives within that framework. At present in relation to regionalisation, TFCs and discards, we do not believe that the right balance has been struck. There remains too much evidence of a residual top-down, command and control approach that will set unachievable and impractical targets and therefore set the CFP’s discard policy up for failure.

We suggest that a more systematic approach to discard reduction is employed which:

Is based on a comprehensive appreciation of the discard reduction initiatives that are already in place
A dialogue which provides a deeper understanding of what the producer organisations and member states already do to minimise discards
An assessment of the extent, fishery-by-fishery, that these efforts are constrained and limited by CFP rules such as catch composition and TAC decisions based on single stock considerations
Integration of measures and management approaches focussed on eliminating this kind of regulatory discards as a precondition for initiatives at the regional level.

CFP Reform – Maximum Sustainable Yield

The North Sea RAC has prepared extensive advice to the Commission on the application of the concept maximum sustainable yield to our fisheries. It is not our intention therefore to repeat all of the arguments here.

It is sufficient to observe that:

The authors of the WSSD commitment to achieve MSY by 2015 were careful enough to include the words “where possible” to reflect the biological reality that it may not be possible to achieve MSY for all stocks simultaneously

The non-paper adopts a quite superficial approach that ignores this important qualification and does little to advance policy thinking on how to achieve sustainable high yield fisheries in mixed fisheries.
It “resolves” the problem of how to apply the MSY concept, which was developed with single stock fisheries in mind, to mixed stock fisheries by proposing that “it should be the most vulnerable stock that determines the limits of exploitation for all other fish taken in the same fishery”

We (and we believe all member states which have to deal with the realities of managing mixed stock fisheries), will reject this crude and dogmatic approach which could cause much damage if co-legislators were naïve enough to adopt it.

Instead, we believe that it should be for decision-makers at regional level to develop their own customised approach to MSY, or some proxy for MSY, within the context of the development of long-term management plans. Usually ‘movement in the right direction’ for a stock or a fishery is a much more significant criterion than endless and often futile discussions on where on the effort/yield curve MSY should be located.

Some of the issues that require consideration in the context of MSY in mixed fisheries are:

Inextricably mixed stocks
Sequential targeting within a single trip
Current Ices work to date on mixed fisheries
Avoidance plans
Gear selectivity
Spatial temporal measures
Discards in mixed fisheries
Economic driver stocks and the rest (Main TACs + “Norway Others” type approach)
“Choke” stocks: minor stocks which could prevent access to main stocks in mixed fisheries
MSY in mixed species fisheries
Management plan trade-offs
Catch composition rules
Governance issues

Against this background we are strongly opposed to any attempt to impose an unworkable MSY obligation into the basic CFP Regulation.

Conclusions

The CFP is at an important crossroads. The arrival of co-decision has amplified and intensified stresses already apparent in the CFP. Failure to adapt and to decentralise decision-making in a meaningful way in this current reform risks a decade of paralysis until the task is completed in the next reform.

Regionalisation

Having now received the Commission’s clarifications in the form of the ‘non-papers’, we are concerned that in terms of delegating responsibilities to the regional seas level there will be a very wide gap between what was envisaged in the CFP Green Paper and supported by the RACs and the substance of post reform decision-making. Our fear is that very little will change if the role of regional cooperation is narrowly defined and restricted to implementing prescriptive requirements still agreed at the centre. A CFP which retains control over aims, objectives and timetables (as opposed to setting standards, determining overall strategy and intervening where there is a default) will repeat the weaknesses seen in the CFP of the recent past. The current EU Cod Management Plan presents an object lesson in what to avoid.

Transferable Fishing Concessions

Whilst we agree that transferable fishing concessions can be an effective way to manage quotas within each member state, we question whether the EU has legal competence in this sphere; moreover, we doubt the wisdom and logic of applying a top-down blanket approach to this area of policy when the stated orientation for the rest of the CFP is in the opposite direction.

Whilst we draw some comfort from confirmation that the Commission envisages TFCs operating within each member state and within the principle of Relative Stability, we are unconvinced by its blanket rejection of past efforts to reduce fleet overcapacity and its rather naïve faith in TFCs as the new panacea.

We caution against the often perverse and unforeseen consequences of drawing an arbitrary line through the fleet, as the Commission does in relation to differentiating the small-scale fleet, especially when it is explicitly envisaged that different conditions would apply above and below that line.

Discard Ban

Whilst we share the Commission’s objective of minimizing discards, the idea of a ‘ban’ owes more to an overreaction to media sensitivities than the hard, practical task of addressing the various drivers for discarding and the development of equally different solutions for them. We are astounded that the non-paper says nothing about the Commission’s own responsibilities to remove all legislation that currently generates discards. The catch composition rules and certain TAC decisions in mixed fisheries is an obvious place to start.

Maximum Sustainable Yield

There is nothing intrinsically wrong with identifying a level of fishing mortality that would consistently deliver high yields and then orienting management decisions to achieve that objective. The difficulty arises when a fetish is made of that objective and sight is lost of the necessary trade-offs, particularly in mixed and multi-species fisheries, that require balance with other objectives. Whilst we can see steady progress in our stocks towards some proxy of MSY, we are absolutely convinced that it would be a serious mistake to tie fisheries managers’ hands at regional seas level by making achievement of MSY a general and mandatory obligation.