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Lord Mackie of Benshie: My Lords, the noble Lord who has just spoken, the noble Lord, Lord Carter, has gone into the whole matter very thoroughly. This is a tremendous smack in the face for the Government. Their method of trying to control what is in fact a cheating device in order to get protection has failed and it looks as though they will have to pay in addition massive compensation.

In the Statement the Minister has just read it says that we must reform the CFP as an urgent matter, but it will take a lot of time. It is, however, absolutely vital. What the noble Lord, Lord Carter, said about the CAP and the CFP was a crack I was going to make and I can only applaud it as perfectly true. The CAP looks like a simple and successful piece of legislation alongside the total

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failure of the common fisheries policy. I can only reiterate that negotiations should be undertaken urgently; that the Government should bend themselves to it and try to get some sense into it.

In the meantime, I wonder whether the Government could look at our own regulations. At the present time, as I understand it, and the Minister might confirm this, these registered boats have to call four times in six months at a British port but they land their catches wherever they wish, particularly in Spain where the registration and collation of data are very suspect indeed.

What would happen if the Government laid down regulations that, not only had they to call four times a year, but in addition they had to use the other alternative and land at least half their catches at a British port? This at least would give us some idea of the size of the problem and the amount of fish they are catching and would make it, I hope, uneconomic for them to adopt this cheating device.

However, I agree that the main priority is to renegotiate the whole business and then to police it properly. The CFP in theory should work but outside a few countries you cannot trust the figures. Certainly on the high seas there is very little chance of stopping everybody who is breaking the rules. It needs a determined attack and it needs money spent on control before we get a policy which the fishermen themselves will believe in. The Government have a tremendous task in hand and we on these Benches would back any effort to improve it and get some justice into the situation for our own fishermen.

Lord Lucas: My Lords, I am very grateful for the support that we have received today from the noble Lord, Lord Carter, and the noble Lord, Lord Mackie of Benshie, for the action which we are proposing to take. It is a very sad day, not for the common fisheries policy, because it is not the common fisheries policy which is at fault in this instance, but for our understanding of the way the common fisheries policy operates within the Treaty of Rome.

The judgment reached by the European Court is that the Treaty of Rome takes precedence over the provisions of the common fisheries policy, whereas we, and I believe all other member states, have been operating on the basis that the common fisheries policy was a reasonable exception in some ways to the provisions of the treaty. Indeed, that raises major questions as to the future of the common fisheries policy and whether it is operable and acceptable to member states. We believe that those concerns will be widely shared and that the impetus to put the common fisheries policy back where it should be, which is in terms of a national right to an agreed share of the common fish resource, is something which will be pursued at the IGC and will be pursued vigorously by us. We believe that we shall receive a great deal of sympathy from other member states because nobody believed that the way the European Court has interpreted this situation is the way in which the common fisheries policy was envisaged when we all set out together to make it.

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So far as the statistics are concerned which the noble Lord, Lord Carter, asked for, we estimate that there are about 150 vessels on the UK register which are currently foreign owned or have significant foreign interest in them. Of these, about 100 have a Spanish interest and the remainder mainly have a Dutch interest. In numbers quota hoppers represent some 5 per cent. of the UK's offshore fishing fleet but account for more than 20 per cent. of its tonnage. Indeed, in some species such as plaice they take 44 per cent. of the quota. Overall they take about 10 per cent. of our white fish quota, but there are obviously some species where they are much higher than that. So far as the costs of any judgments which may be given in time by the UK courts against the Government are concerned, we will have to wait and see what they are. We do not know any more about them than we do about the damages.

So far as the question the noble Lord, Lord Carter, asked about the IGC, I reiterate that it is not the reform of the CFP we are looking at: it is the reform of the treaty. That has to be unanimous and any such reform would not affect the judgment in the Factortame case or its consequences. However, we will look at all ways of achieving our end. I do not think we are stuck on any one particular formula. What we are looking to is putting back the relationship between the common fisheries policy and the treaty that we and others always thought was there, and putting back the status of UK fishermen versus UK quotas that we always thought was there and always believe should be there.

So far as the wider implications of Factortame, yes, the noble Lord, Lord Carter, is again right. This is a judgment which may well affect other situations, such as the denial by Spain of rights of transit for ferries from Gibraltar and the rights of British beef exporters when it comes to selling in Germany and other such areas. It is something which seems to us to be in that limited sense a very reasonable judgment and may as a result have a lot of good consequences for intra-community trade.

The noble Lord, Lord Carter, asked about the Merchant Shipping Act 1988 and the legal advice that we received at the time. I do not have that information with me, but I shall write to the noble Lord to cover that point and the question of the licensing route. My understanding is that the licensing route would not work. Indeed, we cannot see anything that will work without an amendment to the treaty or some close equivalent. We have looked at a great many options, and spent a great deal of time with our own and outside legal advisers, and have not come to any conclusion which would suggest to us any other way of dealing with the problem, either now or in the past.

The noble Lord, Lord Mackie, covered many of the same points but suggested that we might change our present regulations so that half the boats' catch should be landed in the UK. That would seem quite a sensible regulation to put in place, but it is not something that we could succeed in doing under current treaty interpretation by the European Court. We are quite clear that we could not. Nor could we impose residence requirements on the people operating the boats, or

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nationality requirements or any other means by which the boats might be made British. They are all areas we shall be looking at, but as far as we understand, and according to all the advice we have, they would all require treaty amendment.

6.40 p.m.

Lord Campbell of Croy: My Lords, while the European Court's task is simply to interpret laws--and unfortunately the judgment that has just been made has been what I was expecting--does this not make a nonsense of a system of quotas allocated by nationality?

I have raised the subject many times in your Lordships' House, and I spoke when the Merchant Shipping Act passed through this House in 1988, when I supported the revised register requirements included in it. As regards the queries of the noble Lord, Lord Carter, in our debate on 14th February I gave the percentages of quota taken by boats from Spain and Holland, which were as much as 40 per cent. in some cases. Those figures were confirmed by my noble friend Lord Lucas.

The European Union has been trying to pursue two policies at the same time which are totally at variance with each other. One policy attempts to merge nationalities and enable any EU citizen to set up and do business in any member country. The other regulates fisheries by a system of quotas based entirely upon nationality. They are incompatible and conflicting policies.

As it is vital that conservation of fish stocks be achieved, will the Government urgently press for a major change of the present basis of the quota system, namely nationality, or for its replacement?

Lord Lucas: My Lords, I agree completely with what my noble friend said. The judgment throws up a major deficiency in the common fisheries arrangements as they are at the moment and as they relate to the treaty. It is a matter that we must do something about as quickly as we can. However, since it requires treaty amendment, the IGC is the place for that. I do not believe that there is anything that we can do faster, but we shall work very hard when it comes to the IGC.

Lord Stoddart of Swindon: My Lords, to mix my metaphors, it seems that the stinking fish are coming home to roost. Is the Minister aware that there is outrage in the country as a whole, and particularly among the fishing community, at what has happened? The noble Lord was in the other place with me this afternoon. Does he agree that there was all-party condemnation of the situation which has been brought about by the judgment of the European Court of Justice and of the route by which we got there? Unfortunately, the situation goes back a long time. Does the Minister agree that, after the Factortame judgment, not only the Government but this House and another place agreed far too easily to set aside the Merchant Shipping Act 1988, which was designed to protect the livelihood of our fishermen and to conserve our fish? Have the Government not learnt from that that they ought not to do the bidding of the European Court with quite such alacrity and in such a short period of time?

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What will the Government do if, as is most likely, the other countries of the European Community will not agree to a treaty revision? They will be faced with an almost impossible position, unless they are prepared to re-establish the sovereignty of Parliament over not only fishing but also other rights. If they are faced with the implacable opposition of our competitors in the other member states of the European Union, will they be prepared to come to Parliament and repeal Section 2 of the European Communities Act 1972 in order to give back to Parliament the powers which it so wilfully and foolishly gave up at that time?

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