TRADEABLE FISHING RIGHTS

There is a tendency for commercial fishers to target commercially valu­able species until the population numbers of those species decline dra­matically. Efforts to prevent overfishing are generally aimed at conserving a particular species as a sustainable economic resource.

Tradeable fishing rights limit who can fish and how much they can catch by allocating individual quotas, but they go one step further in encouraging the trading and marketing of these quotas. The idea is, firstly, that those who value the quotas most will buy them, which will lead to economic efficiency; and secondly, that those who own quotas will have an interest in conserving the fishery resource because they own a share of it.

However, the prime goal of tradeable fishing rights - since fishing can be limited in a number of ways - is to deal with the situation where fishing fleets have overcapitalised in relation to the size of the catch. That is, capacity has exceeded that which can be sustainably harvested: 'too many boats chasing too few fish'. It is thought that creating a market in fishing quotas will enable some fishers to leave the industry with com­pensation from selling their quotas and others to consolidate their share, ensuring that capacity is more in line with allowable catch. In this way the outcome will be a more efficient fleet.

Box 13.1 Some acronyms

ITQ = individual transferable quota

ITCQ = individual transferable catch quota

IFQ = individual fishing quotas

TAC = total allowable catch

TACC = total allowable commercial catch

QMS = quota management system

QMA = quota management area

New Zealand

New Zealand was one of the first countries to introduce a comprehensive system of tradeable fishing rights in 1986.

Each year the NZ Minister of Fisheries sets a total allowable catch (TAC), in tonnes, for each of almost 100 fish species in each quota man­agement area, covering about 85 per cent of the commercial catch by volume and value. TACs are supposed to be based on scientific research about sustainable catches. Some of the TAC is reserved for Maori and recreational fishing and the rest - the total allowable commercial catch (TACC) - is allocated to commercial fishing. Commercial fishing requires a commercial licence and an individual transferable quota (ITQ) which entitles each fisher to a specified percentage of the TACC, which trans­lates into a certain amount of fish of each particular species for which they hold ITQs (Bess 2005: 340; Walker 2005).

Quotas were initally allocated according to past fishing records, with those who caught most in the past getting the largest ITQs. ITQs last forever and can be used, sold, leased or given away like any other personal property. Trades are arranged through advertisements, per­sonal contacts or brokers. No one company or individual can own more than a specified percentage of the TACC for a species in a particular management area. That percentage varies from 10 to 45 per cent for dif­ferent species (SFN 2003).

Australia

Regulations on southern bluefin tuna in Australia were replaced by indi­vidual transferable catch quotas (ITCQs) in 1984, ostensibly as a conser­vation measure. The government set the total allowable catch, and the rights to shares of that catch, or quotas, were allocated on the basis of boat value and catch history of each boat.

Following introduction of the ITCQ system almost two thirds of the boats with a quota over 5 tonnes sold their quotas and left the fishery, including most of the NSW fleet and the Western Australian fleet. At the same time the quotas owned by South Australians increased from 66 to 84 per cent and the value of the overall Australian catch increased despite the declining TAC: 'The change to an individual quota system changed the incentive structure to one where operators could concen­trate on minimising the cost of taking their catch, and on maximising the value of their quota' (Campbell et al. 2000: 113).

In 1989 the Australian government decided that tradeable fishing rights were the best way to manage fisheries (Campbell et al. 2000: 109). Fisheries governed by the federal government which employ ITCQs include the southern bluefin tuna fishery, the south-eastern fisheries and the Macquarie Island fishery. There are also transferable quota systems for some state fisheries.

United States

In the early 1990s three individual fishing quota (IFQ) programmes were established in the USA. Their primary purpose was to prevent overcapitalisation in the commercial fishing industry and thereby increase its economic efficiency. Open access to fisheries had led to a race to catch the fish, which led to increasing investment in equipment to out-fish other boats, as well as increasing safety risks. It also led to a glut of fish early in the season, causing prices to fall, and a surplus of frozen fish later in the season, when the fish were gone or the TAC taken (Buck 1995).

IFQs allowed some fishers to sell out, thus reducing the size of the fishing fleet. The aim was for those who remained in the industry to take their time catching their quota, which meant they wouldn't have to over­capitalise their boats and could work with fewer crew.

In 1996 a six-year moratorium was placed on further IFQ pro­grammes being introduced. That moratorium has now expired and the current Bush Administration is very much in favour of reinstating them. New legislation, aimed at doubling the number of such programmes by 2010, would replace legislation that requires 'all fisheries to be restored to healthy levels in 10 years' by limiting when fish can be caught (Bell 2005).

Other nations

Individual fishing quotas were introduced in Iceland as a temporary measure after a series of reports from the Icelandic Marine Research Institute about the imminent collapse of cod stocks (Hannibalsson 1995). Although there had been some limited capacity to transfer quotas earlier, it was not till 1990 that ITQ systems were formally established in Iceland with the Fisheries Management Act. Quotas were separable from fishing boats and 'provided a basis for a quota quot;stock marketquot; which continu­ously redistributes fishing rights between vessel owners, communities and regions'. As elsewhere, the numbers of vessels decreased dramati­cally but the fleet's overall capacity increased because of increased engine power and greater catch capacity per vessel (Eythorsson 2000: 486-7).

ITQ programmes have been established in a number of other coun­tries, including Canada, Spain, Italy, the Netherlands and South Africa (Buck 1995; Laxe 2005). The United Kingdom is proposing an ITQ system to replace its system of fixed quota allocations (FQA), which are usually allocated to fishing producer organisations (POs). POs may in turn allo­cate quotas to individual vessels, which can be traded, but this is an informal arrangement and lacks the security that fishing people would like (Hatcher amp; Read 2001; SFP 2004).