Select Committee on European Union Written Evidence


Memorandum by The Institute for European Environmental Policy

INTRODUCTION

  The Institute for European Environmental Policy (IEEP) has established itself as an independent and effective centre of new thinking and, increasingly, a key player in the area of fisheries and the environment in the UK and Europe. IEEP has a long track record of working on a coherent set of initiatives on detailed areas such as subsidies, indicators and inshore fisheries management and made significant contributions to the major review of the Common Fisheries Policy (CFP) in 2002.

  IEEP policy researchers includes economists, political scientists, lawyers and natural scientists and, by consistently focusing on the core policies actually or likely to affect UK and EU fisheries, IEEP has plugged a major gap in the policy debate, strongly complementing the work of other actors. IEEP has also played a key role in guiding the European Commission, NGOs and national policy-makers on various aspects of fisheries policy during the 2002 Reform. We thank you for this opportunity to provide evidence for this critical inquiry on the performance of the CFP over the last five years.

GENERAL COMMENTS

  The Common Fisheries Policy (CFP) provides the framework for fisheries management in the EU. Indeed, Member States can only act to conserve fish stocks if they are given express powers to do so under the CFP. Securing sustainable fisheries at national or local level in any of the Member States therefore depends on getting the EU policy framework right, as well as ensuring its correct implementation on the ground or at sea.

  Prior to 2002, the CFP was criticised for mismanaging the fisheries sector and forcing fishermen to overfish, leading to irreversible damage to stocks of major economic importance, as well as to invaluable marine ecosystems. During the reform of the CFP in 2002, policy actors were forced to contemplate the changes required to address the alarming state of EU fish stocks and new measures to change fisheries management. A new approach to management of EU fisheries was reflected in the 2002 CFP reform and the new Basic Regulation adopted by the European Commission in December 2002.

  At the end of December 2002, the Council agreed to an important package of reforms to the CFP. These were primarily legislative changes to the conservation and structural policies. They reflected:

    1.  a move towards a more long-term approach to fisheries management. The revised CFP should lead to a shift away from annual decision-making on Total Allowable Catches (TACs), to multi-annual planning;

    2.  a commitment to the progressive implementation of the ecosystem approach to management;

    3.  a new fleet policy to limit and gradually reduce over-capacity. Members States are given more responsibility to match capacity with fishing possibilities, while vessels' renewal and modernisation subsidies are phased out;

    4.  a better application of the rules. This is to be achieved through an increased co-operation between national authorities and a more uniform control and sanction system throughout the EU; and

    5.  improved governance. The aim is to involve stakeholders more closely into the policy making process. This is to be achieved through the setting up of Regional Advisory Councils (RACs).

  The 2002 deal was significant, but in many ways just marked the beginning of a longer term reform process. The new CFP framework Regulation sets out the objectives, principles and instruments to support EU fisheries management in the 21st century. However, real change on the ground or at sea required the subsequent adoption and successful implementation of detailed "daughter" legislation.

  Five years after the 2002 reform agreement, it is time to judge whether the new CFP has been transformed from paper to practice. The European Commission made some efforts to implement the reform agenda, by developing its ideas on various aspects of management, from inspection and enforcement, to scientific issues. It also came forward with a series of important legislative proposals, covering recovery plans, cetacean by catch, regional advisory councils and deep sea fisheries. A more in-depth analysis of progress is provided below under the various elements of the CFP.

SPECIFIC COMMENTS

Conservation Policy

  The cornerstone of EU fisheries management fisheries management in the North East Atlantic and the Baltic Sea has traditionally been the TACs and national quotas. The TAC system has several advantages—it is relatively simple and it has built-in subsidiarity, allowing Member States to decide how quotas are distributed among their fleets. Nevertheless, it is rather a crude management tool and not sufficient to conserve European fish stocks and the system of TACs was heavily criticised during the 2002 reform. Despite its shortcomings, TACs and quotas were retained as a key management measure post 2002. In addressing some of these shortcomings, the European Commission and ICES have placed increasing emphasis on the precautionary approach in proposing TAC levels. The calendar for setting the annual TACs was brought forward, in 2006, to allow enough time for stakeholder consultations prior to the drafting of legislative proposals and decisions. Through improving the basis for TACs and increasing and transparency it is hoped that the year on year fluctuations and deviations from scientific advice, which happens on an annual basis, will be reduced. In addition to these modifications to the establishment of TACs, the Commission has also adopted a longer term approach to management which should lead to better conservation of stocks in the long term.

A longer-term approach: the use of multi-annual plans and recovery plans

  The reform of the CFP in 2002 had a clear ambition to adopt a longer-term approach to fisheries management. Consequently, two types of multi-annual plans have been developed as crucial components of this approach: management plans and recovery plans. Management plans are implemented to maintain stocks at safe biological levels (above limit spawning biomass) before stocks reach a critical level. However, certain fish stocks are already in a dangerously depleted state and, in these cases, recovery plans are developed and implemented as a means to halt and ultimately reverse further decline. During the years following the CFP reform, the Council has largely acted on implementing those multi-annual plan although it has also adopted a series of management plans and species recovery plans since 2004: North Sea cod, Northern hake, Southern hake and Norway lobster stocks recovery plans, as well as Bay of Biscay sole multi-annual plan; and more recently the long awaited recovery plans for European eels and the Baltic Sea cod to enter into force this year.

  The implementation of recovery plans in Europe has been a fairly new development. It is too early to evaluate the effectiveness of these plans and their associated measures although stakeholders and decision-makers have begun to comment and proceed with preliminary evaluations and there are indications that most of these plans have failed. The lack of success in these cases has been attributed to a number of factors including:

    —  The lack of stakeholder participation in the plan drafting, implemention or monitoring.

    —  The lack of progressive reduction in fishing mortality to complement other measures in the plan.

    —  Ill-defined recovery process (eg unclear harvest control rules); unclear references and target points, as well as the lack of precise timeframes for subsequent action.

    —  The lack of socio-economic data to ensure efficient management options were used for recovery planning.

    —  The lack of data on the social impacts of existing recovery plans.

    —  Ineffective Monitoring, Control and Surveillance measures (MCS) to ensure compliance with the measures in the plans.

  Regardless of these shortcomings, it may be too early to draw conclusions on the success or failure of the recovery plans in Europe. Importantly, there are claims that the slow recovery of biomass (a key objective of the recovery plans) is not necessarily due to overfishing and excess of fishing capacity. Environmental conditions may also be affecting recruitments and further slowing down the recovery of some of these stocks. Further studies are needed to evaluate the impact of other environmental factors during the period of the recovery plans. A thorough evaluation of the recovery plans would therefore require more time and more accurate data in order to reach a conclusion.

Technical Measures

  Fisheries in EU waters and by EU vessels in international waters are covered by different technical measures regulations, one for each of the areas of the Mediterranean (Council Regulation 1626/1994), the North Sea (including Kattegat and Skagerrak) and the Atlantic (Council Regulation 850/1998), the Baltic Sea (Council Regulation 88/1998) and the Antarctic (Regulation 600/2004). The current Regulation for the North Sea (Council Regulation 850/1998) which came into effect in 2000 and the rules were simplified and adapted to the current needs of the industry to promote conservation of fish stocks.

  In 2004, the Commission set out its plans for improving technical measures in its Communication, COM(2004) 438. In this Communication, the Commission presented a set of actions and timelines which included:

    —  A review of current technical measures Regulations;

    —  A reduction of discards;

    —  Research in support of environmentally fishing methods through the 6th Framework Programme of Research; and

    —  Proposals for new financial incentives.

  By 2007, the Commission has progressed on all four proposals. In relation to technical Regulations, the North East Atlantic Regulation was revised in 2004. A further revision of this Regulation and those for the Baltic and the Mediterranean are currently underway. In relation to discards, the Commission funded a pilot project to address the problem of ghost fishing in Community waters. IEEP was involved in this project which contributed to the Commissions final decision on ghost fishing.

  The need to address by-catch and discards was identified by the Commission as an important objective during the reform of the CFP in 2002. In 2003, the Fisheries Council adopted conclusions inviting the Commission to explore ways to resolve the problem. However, very few projects have materialised and demonstrated good results and by-catch and discards still remain a problem for most fisheries. On 28 March 2007, the Commission adopted a Communication to the Council and the Parliament on a policy to reduce by-catch and discards in European Fisheries (COM(2007)136). In this Communication the Commission presents issues for discussion and outlines the policy approach to reduce unwanted by-catch and progressively eliminate discard based on an internal working paper on preliminary impact assessment of three policy options. The first option—to take no specific actions but to continue fisheries management as it currently stands. The second—to take supplementary direct measures and adapt CFP instruments including real time closures and selective fishing gear and the third option—to a) implement a discard ban as a stand-alone option or b) to implement a discard ban, supplemented with additional measures. The European Commission is planning to propose a new Regulation on discards in May 2007, based on further analysis of the various options. IEEP has been assisting the Commission with the analysis. Further analysis of the options available to the Commission indicates that there may different approaches to different fisheries depending on the levels of discarding and the social, economic and environmental impacts. In addition, due to the complex nature of EU fisheries, there is no one-size-fits-all solution to the discard problem and the European Commission will need to look very closely at the environmental benefits of various options versus the social and economic costs.

  The EFF Regulation[1], adopted in 2006 provides financial incentives for the promotion and use of environmentally-friendly fishing, including the development and use of more selective gears while compensating for short term losses for vessels participating in trials of more environmentally-friendly fishing methods (Axis 1 and Axis 3). The allocation of funds to these axes and activities should included in the National Operational Programmes (NOPs) currently being prepared by Member States. Not all Member States have completed this process and therefore it is too early to judge whether the new EFF will result in the use of more environmentally-friendly fishing gear (see below).

Structural Policy

  Regulation 1198/2006[2] establishes the European Fisheries Fund (EFF), the structural policy for fishing activities for the period 2007-13, succeeding the 2000-06 Financial Instruments for Fisheries Guidance (FIFG). Unlike its predecessor, the EFF is no longer a structural fund. Although funding is still allocated using multi-annual programming, the EFF includes more responsibility to Member States with the development of national strategic plans and operational programmes. Also, measures available for funding fall under five priority axes clearly defining the range of actions to undertake:

    —  Adaptation of the Community fishing fleet.

    —  Aquaculture, inland fishing, processing and marketing.

    —  Promoting collective interest.

    —  Sustainable development of fishing areas.

    —  Technical assistance to facilitate the delivery of assistance.

  The objectives of the EFF remain slightly similar to those of the FIFG, although they are certainly "greener" and more in line with the objectives of the 2002 CFP reform. Funding for an increase in fishing capacity of any sort is strictly ruled out. The EFF also provides more room for measures contributing to more environmental integration and stakeholders' participation. The EFF is also more devolved to socioeconomic issues and the integration of the fishing economy into national economies. This is shown by the opportunities for funding retraining and alternative job opportunities. The EFF also aims at providing specific help to less favoured and remote fishing areas within the EU, by means of differential funding between "convergence" and "non-convergence" regions.

  The EFF therefore marks a further step towards funding of sustainable fishing activities. However, at the beginning of 2008 the EFF is still at its early stage of implementation with the adoption of 19 of the 27 operational programmes, and some uncertainties remain about the uptake by Member States of measures consistent with the objectives defined by the European policy. The early stages of the EFF implementation process have already highlighted some dissimilarity among Member States regarding the consultation of stakeholders and the integration of environmental objectives (eg financing Natura 2000).

  As the breakdown of national budgets by priority axis has been published recently, it is possible to get an overview of Member States' priorities. The EU-15 are more prone to allocate to traditional funding (ie capacity adjustment) while new Member States dedicate a large part of their budget to axis 4 "sustainable development of fishing areas" (up to 23% for Latvia and Estonia and 33% for Romania). This is likely to create more opportunities for funding new "conservation type projects" in new Member States, whereas old Member States will stick to their "business-as-usual" funding. However, it is recommended to be careful about the uptake of axis 4 funding, measures are ranging from regeneration of coastal communities to environmental protection and eco-tourism. Hence, if not correctly assessed, the important proportion given to "new" measures could be used rather for preserving social fabrics than helping the fishing economy and funding vital measures linked with safety onboard, increasing competitiveness of the fleet, developing marketing and distribution of fish and fish products, etc.

  Monitoring and evaluation of the EFF is based on a close exchange between the Commission and Member States, which had to produce ex ante programme evaluations when submitting their operational programmes. Moreover, once the EFF is in operation, Member States will have to produce annual progress reports about the uptake of the EFF budget. The structural policy therefore appears to be effectively monitored and evaluated throughout the process, but efforts will be required from Member States to report correctly to the Commission and vice versa.

  The CFP structural policy seems to have no long-term planning and appears to be quite unenthusiastic to review what has been achieved so far. The ex-post evaluation of the 2000-06 FIFG is still pending and is not likely to be conducted before the end of 2009 or 2010. Meanwhile, the Commission is planning a mid-term review of the EFF at the latest by mid-2011. This will be a strategic period for the Commission to assess its past, current and future structural policy. It is important that the FIFG's ex-post evaluation feed the review of the EFF and allow for a forward-thinking strategy for the upcoming fund after 2013.

  The EFF surely provides a promising perspective to the CFP, but a lot still remains to achieve a well-balanced and sustainable fisheries sector and the overall CFP structural policy has to keep in line with these recent progresses by going three steps forward and two steps back. Indeed, the de minimis aid approved mid-2007, by increasing the state aid ceiling from 3,000 to 30,000 euros has opened the back door for further cost-reducing subsidies (eg fuel subsidies) while the Commission is claiming that the solution is not to give subsidies to meet part of the increased costs due to ongoing external pressure (eg rising fuel costs). The policy is bound to be radically different from 2013 onwards. Subsidies to the fishing sector will have to be phased out, according to the global context and recent WTO outcomes. This leads to further uncertainties about long-term sustainability of the European fisheries sector.

Governance

  One of the most concrete actions taken by the Commission to date on implementing a new approach to EU fisheries governance under CFP since 2002 is the establishments of the RACs. There are plans for seven RACs:

    —  The Baltic Sea RAC (operational in March 2006);

    —  The North Sea RAC (operational in November 2004);

    —  The Mediterranean Sea RAC (in the process of being established);

    —  The North-western waters RAC (operational since September 2005);

    —  The South-western waters RAC (operational since April 2007);

    —  The Pelagic Stocks RAC (operational since August 2005); and

    —  The Distant water fisheries RAC (operational since March 2007).

  RACs were originally intended to primarily provide advice to the Commission and national fisheries managers on management issues including development and implementation of the ecosystem approach. RACs were meant to support resource management, including progressive implementation of the ecosystem-based approach. They should aim to do so, taking full consideration of existing EU legislation regarding environmental and other issues. Despite their lack of legal "teeth", RACs should be influential if their advice were allowed to drive the decision-making process. It is for this reason that industry and non-governmental groups have taken a close interest in their evolution and functioning.

  It is too early to judge the influence of the RACs but their influence on decision-making is growing. In recognition of their contribution to the development of the CFP, the Council recently agreed to continue funding RACs beyond the period originally agreed. Initially, it was intended that RACs would benefit from start-up aid which would last the first five years. The Council has now agreed that TACS will receive permanent funding of €250,000 every year in order to continue their activities. The wider role of the RACs within the new European Maritime Policy is unclear but it is evident that they need to be involved and can continue to play a key role in promoting sustainable management on a regional scale.

Control and enforcement

  In October 2007, the Commission made a proposal for a Council Regulation establishing a Community system to prevent, deter and eliminate illegal, unreported and unregulated (IUU) fishing. The aim of this proposal is to ban imports into the EU of fisheries products caught illegally. The proposal lays out two sets of rules. Firstly, it proposes rules to deal with illegal landings by EU vessels and secondly, it proposes actions against foreign-flagged vessels which are involved in IUU fishing activities. In the previous strategy, the EU focussed on improving monitoring, control and surveillance (MCS) at sea and identifying IUU fishing operations. However, the new proposal aims to extend the framework to the rest of the supply chain and improve its effectiveness using trade measures.

  Specifically, the EU seeks to address all fishing and related activities linked to IUU practices. This includes transhipments, processing, harvesting and landing. The inclusion of the trade dimension is very important and is based on the recognition that the EU is the biggest market and lead importer of fisheries products—recent assessments have shown that the volume of illegal fisheries products imported into the EU each year amounts to approximately 500,000 tonnes to a value of €1.1 billion.

  Several new developments have come up from this plan, including that the Commission proposes fines ranging from €300,000 to €500,000, though it was to be defined by Member States before. Importantly, the plan includes a catch certificate to be filled-in by vessels. One can argue that this certificate which requires an important set of data is likely to prevent developing countries fishing fleets to enter the EU market. Accordingly, this may constitute an important non-tariff barrier to the entry of developing countries fisheries goods in the EU.

  On April 2005 the Council adopted the Regulation establishing a Community Fisheries Control Agency (CFCA). Its main task is to achieve the effective implementation of the CFP and to establish uniform inspections and enforcement throughout the Community. Developing and monitoring joint deployment plans, implemented by the Member States, will be central to achieving these tasks. While the Agency cannot directly strengthen enforcement measures such as penalties, it will play a key coordinating role, which is an important step in taking forward the "post-2002" CFP as it could significantly improve implementation and enforcement.

  The preparation of Joint Deployment Plans (JDP) is one of the CFCA's main tools for insuring effective enforcement and equal treatment for all those involved in a particular fishery. The criteria for a JDP is that the fish stock concerned must be subject to a long-term recovery plan or a multi-annual management plan and a specific control and enforcement plan has to be adopted by the Commission. A JDP for the North Sea cod fisheries has recently been adopted by the CFCA on July 2007. This plan comes as a complement to the tightening of cod recovery plan enforcement that requires Member States to develop their national control programmes and will pool the resources from seven Member States by using inspectors, control vessels or aircrafts to ensure effective and uniform control of fishing activities. Two other JDP will be also put in place next year, focusing on cod in the Baltic Sea and bluefin tuna in the Mediterranean.

  The effectiveness of the agency depends to a large extent on the details of the "control and inspection programmes" to be implemented, in which the Member States plays a central role. While the CFCA is currently moving to be based in Vigo (Spain), it is still too early to assess its effectiveness and the commitment of Member States on the enforcement of the CFP measures.

  The release at the end of 2007 of a Court of Auditors report on the existing system of control applicable to the CFP[3] has highlighted some weaknesses in the functioning of the EU's control system at a national level. According to this document, shortcomings have been observed on the catch registration systems, whose data are neither complete nor reliable. Additionally, inspection activities are ineffective and inefficient, and controls of resources are too concentrated on inspections at sea rather than at the time of landing. Also, the follow-up of reported infringements does not necessarily lead to sanctions, which are in any event recognized as non-dissuasive. Importantly, these shortcomings are even more emphasized by the pervasive reduced profitability of the EU fisheries sector that prompts fishing vessels to non-compliance.

  The Commission has therefore decided to begin the reform of its control process. This reform encompasses several objectives, which aims to strengthen some key elements of the EU system control: the capacity of the Commission; the mandate of the CFCA; the cooperation across national authorities and with the CFCA; the level and harmonisation of sanctions; the involvement of stakeholders into the so-called "culture of compliance"; cost effectiveness of the control process; and the use of modern technologies.

  The plan to review the control regime in 2008 and propose a new improved Regulation signals the Commission's commitment to addressing the shortcomings of the current regime. However, the challenges brought by the reform of controls in the EU fisheries sector are considerable and these need to be addressed in earnest if the new control regime is to be successful.

EU's external policy

  The bilateral fisheries partnership agreements (FPAs) have been developed according to a Commission Communication in 2002[4]. There have been encouraging changes in the structure and approach of FPAs compared to former fisheries access agreements (FAs). This is particularly true about developing partnerships with third countries, by means of a percentage of the financial contribution attached to the agreement to be set aside to support the sectoral fisheries policy in the third country. This percentage ranges from 18% for Micronesia to 100% to Ivory Coast.

  Moreover, the general trend in FPAs away from mixed agreements and towards tuna agreements is likely to offer a more coherent exploitation of stocks and avoid conflicts between EU and small scale third-countries fleets. FPAs are likely to provide more revenue to the fishing sector, and hence better contribute to the development of the third-country fisheries sector regarding stock assessment, monitoring and control, processing and distribution, etc.

  Nonetheless, FPAs show some weaknesses in the evaluation of impacts of the EU fleets. Ex ante evaluation of FPAs are imprecise with regard to EU fishing effort, evaluation of marine resources available for fishing and their valuation. It should also better address the benefits provided to the third-countries economies. Practically, one has to make sure that enforcement capacities from third-countries are sufficient to prevent the EU fleet from taking advantage of such weaknesses.

  From a market perspective, FPAs are likely to reduce third countries' trade in fish and fish products in case of no local landings. The implementation of FPAs by the EC has voluntarily put aside the fisheries sector from the general EU trade policy, which is mostly based on the Economic Partnership Agreements (EPAs). Accordingly, this can threaten the sustainability of exports of fisheries goods to the EU.

CONCLUSIONS—ONGOING CHALLENGES

  Despite the progress towards implementing the reformed CFP since 2002, there is still a need to transform the new Regulation into specific legal requirements and to ensure the successful implementation and supporting regulations. A key area which requires further actions is "bringing fishing effort in line with the fisheries resources". Despite long standing fisheries management efforts, the CFP still has not managed to balance fishing activity with fishing opportunities. Excessive fleet capacity is a major contributing factor. This is the legacy of many years of inadequate management, combining aid for building new vessels, weak fleet reduction requirements, limits on landings rather than catches and poor enforcement policies.

  The challenge is still to find feasible ways to bring fishing capacity back in line with available resources. Rights based instruments—notably Individual Transferable Quotas (ITQs) for fish have been strongly promoted by economists on grounds of economic efficiency. In countries such as New Zealand, they have been instrumental in reducing fishing effort and waste and foster a general sense of legitimacy and ownership in the resource management. To date several stakeholders with vested interests in Europe have been strongly opposed to them. Within RBM systems the most controversial aspect that emerges is the transferability of rights. Introducing a resource price for fishing rights may lead to the buying of rights on a large scale, therefore concentrating ownership of quotas, geographical distribution and fleet composition while the environmental benefits may not be clear. The consultation on RBM is due to last 12 months after which the Commission will then report to the Council and the European Parliament and, if and when appropriate, make proposals or recommendations for follow-up.

  EU enlargement will continue, and with it the EU waters will grow. Although the EU already includes all of the European Seas, if Turkey joins the EU will become a significant player in the Black Sea beyond what it is now with only Bulgaria and Romania as coastal Member States. This growth, together with the joining of Croatia, will increase the EU's role in the Mediterranean. Management can be expected to improve in both cases, but the extent will be limited by the fact that there will continue to be many other countries to cooperate with in the two regions.

  The growing importance of the Black and Mediterranean Seas can be expected to deepen the trend towards regionalisation of the CFP. Management plans and cooperation at a regional level will become more prominent, and effective, as more countries join the EU.

  The EU Maritime Policy (MP) was adopted in 2007 and the EU Marine Strategy Directive was recently adopted by the Council. The EU MP is aimed at ensuring better integration of maritime policies including the CFP towards better conservation and protection of European waters, while the MSD is reliant on Member States achieving "good environmental status" by 2020. Whilst these policies have the potential to add value, by filling some gaps that the CFP is unlikely to close, there is scepticism whether this will be the case.

  The current CFP has five more years to run its course. In the next two years, it is important that evaluation of key sub-policies is undertaken to ensure that the CFP can be adapted to meet the challenges after 2012.

3 March 2008






1   Council Regulation (EC) No 1198/2006 of 27 July 2006 on the European Fisheries Fund. Official Journal. 15.8.2006. L 223/1. Back

2   Council Regulation (EC) No 1198/2006 of 27 July 2006 on the European Fisheries Fund, OJ L 223 of 15.8.2006 Back

3   Special Report No 7/2007 pursuant to Article 248(4) second paragraph, EC, on the control, inspection, and sanction systems relating to the rules on conservation of Community fisheries resources. http://eca.europa.eu/portal/pls/portal/docs/1/673627.PDF Back

4   Communication from the Commission on an integrated framework for Fisheries Partnership Agreements with third countries COM/2002/0637 final Back


 
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