Trade Negotiations Insights • Volume 8 • Number 1 • February 2009

A unilateral perspective on an international concern

A look at the EU’s IUU regulation

by Abdoulaye Diagne

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In September 2008, the European Commission passed Council Regulation (EC) No 1005/2008 intended to establish a system to prevent, deter, and eliminate illegal, unreported, and unregulated fishing (IUU). The objective is to ensure greater sustainability of fish stocks, while lessening competition challenges that illegal fishing poses for EU fishermen. The regulation is also a key item in the current exchanges underway between the European Union and third countries, particularly the ACP.

From the developing country perspective, a lot of outstanding questions related to this new provision remain; a fuller explanation of the measures it includes is thus needed so that the relevant economic actors and affected states are sufficiently aware of the issues and the potential future implications for their relations with their main fisheries sector partner: the EU.

For instance, some issues raised by this new regulation relate to the major enhancements of mechanisms for traceability, which will allow all fisheries products to be monitored from the fishing vessel to the point of sale to consumers. Now, the whole cycle, from production to consumption, will be tracked by means of the catch certificate – the key element in the fight against IUU fishing. This catch certificate must not only conform to regulation No. 1005/2008 but must also be validated by the appropriate competent authorities on the basis of national control mechanisms and the enforcement of laws, regulations, and conservation and management measures applicable to the flag state’s fishing vessels. While this is an important regulation, some of the measures contained here – and throughout 1005/2008 – risk imposing restrictions on developing countries with limited institutional, human, and material capacities.

Measures likely to cause problems for ACP and developing countries

By way of example, we point to the following potential problematic measures for developing and ACP countries:

01. Conservation and management measures
Third countries must observe international and community conservation and management measures (CMM), particularly as related to the catch certificate (article 12 para. 3), and as defined in article 2 para. 9. This is in order to ensure that the third party decisions are in conformity with the campaign against IUU fishing. However, it is not clear what these measures consist of or where they are published and updated. In the absence of a comprehensive list of such measures, developing countries will find it difficult to conform to CMMs, particularly given the fragility of their institutions.

02. Some measures are subject to European States’ national legislation
According to the regulation, some clauses are subject to national enforcement (article 1 para. 2, and specifically in the case of sanctions, article 7 para. 3). Given that there are currently twenty-seven states involved, developing countries could potentially be faced with twenty-seven different sets of legislation.

03. Powers of the various organs of the European Union
The regulation provides for intervention, where appropriate, by different organs of the European Union: the Commission, the Community Fishing Agency, the Council, and Member States. But given their limited capacity, economic actors in developing countries may have some difficulty in navigating their way through the EU system of multiple internal competences.

04. Powers of inspection
Vessels of EU Member States have wide powers of inspection and these may therefore, if used inappropriately, constitute administrative harassment amounting to a technical obstacle to trade. It is envisaged that there will be inspection of “at least 5% of landing and transhipment operations” (article 9 para. 1) with no indication of any ceiling on inspection. In the case of vessels suspected of IUU fishing, inspection is obligatory.

05. Conservation and management measures by national fisheries
Conservation and management measures are obligatory under the FAO International Plan of Action (IPAO) on IUU (1)and the present regulation. But, the majority of developing countries have yet to draw up their national plans.

06. The specific case of artisanal fishing
The new regulation does not distinguish between types and methods of fishing, but rather lays down general rules applicable to all situations. However, in developing countries the majority of catches are made by artisan fishermen who are frequently illiterate. Due to their lack of education, it is expected that these fishermen would experience real difficulties in fulfilling the conditions required for validation of the catch certificate.

07. The lack of proportion between the conditions imposed on third countries including ACP countries and their capacity to comply
One flaw of the EU regulation is that not all affected parties are involved in formulating them; another is the reliance on a mechanism of cooperation whose scope, goals, and targets are not specified in advance. For developing and ACP countries, this becomes an acute and reoccurring challenge.

Relationship to international trade rules

Along with the ambiguity around some of the measures in the regulation, it is also doubtful whether all are compatible with the rules and principles generally adhered to in the international trade system. Specific areas of concern are:

01. The extension of powers (of sanction, injunction, declaration of non-cooperating states, listing of IUU fishing vessels, etc.) to third countries who are not party to any Agreement, or in this case, to a regulation drawn-up unilaterally, although referring to the FAO IPAO on IUU.

02. The vague, ill-defined, and subjective nature of some of the measures, which contravene the principles of clarity and transparency observed by the rules of multilateral trade, such as “reasonable proof” or inspection of “at least 5% of landing and transhipment operations.”

03. The increased powers of sanction of EU Member States in the form of immediate implementation measures (halting fishing activities, seizure) under article 43 para. 1. The regulation does not mention the possibility of appeal or of compensation if the assumed contravention is not proven. These sanctions may even constitute measures restricting access to EU markets on the basis of presumption alone. Would this not be defined as ‘technical obstacles to trade’?

04. The lack of respect for the principles of non-discrimination and equality of treatment between operators and states. The flexibility envisaged for the EU list of IUU vessels is not applied to third countries’ vessels (article 27 para. 8). Similarly, the requirement to disembark and use port services in areas or ports reserved for third countries could constitute a source of discrimination against these countries.

Ways forward

EU regulation is a useful instrument in the campaign against IUU fishing, which is a threat and a handicap to operators and states engaged in responsible fishing. However, despite the unilateral way in which it has been drawn-up, this new regulation may be utilised by developing and ACP countries – the main victims of IUU fishing. As argued here, the regulation can also be seen as a system to be improved by taking into account other multilateral trade system mechanisms and the concerns developing countries have expressed. The following areas in particular may be explored:

01. Guaranteeing free access, without unnecessary restrictions, under the the EU Everything But Arms (EBA) scheme, as well as preserving duty- and quota-free market access to LDCs and non-LDCs ACP countries under the EPAs;

02. Establishing a coordinated and lasting strategy that considers both the negative effects of IUU fishing and the negative economic effects of the measures required to implement the EU/IUU regulation;

03. Ensuring flexibility in carrying out traceability checks on processed products with diverse origins. This involves mutual and reciprocal recognition of catch certificates validated by the competent authorities in neighbouring countries (in the case of shared species);

04. Carrying out impact studies prior to the implementation of the regulation in ACP countries and requesting a moratorium for countries that do not yet have the capacity for compliance;

05. Specifying the sources of finance and the types of cooperation and aid provided to cover the costs of implementing the regulation, given that the relevant national programmes have already been put in place; and

06. Following up on the Ministerial Conference on fishing in ACP countries scheduled for 2009 in the Seychelles, where one of the items for discussion may be the application of the EU regulation.

In conclusion, IUU fishing is an issue of concern to both developed and developing countries and the European initiative of regulation 1005/2008 opens up the possibility of addressing this problem. This provision may be used as a springboard to the launch of a multilateral agreement on the campaign against IUU fishing. But, for developing and ACP countries, a more multilateral approach to illegal fishing would strengthen its acceptability, inclusiveness, and effectiveness.

Author: Abdoulaye Diagne is a trade expert with the Senegalese Ministry of Trade. He can be reached at: Abel...@yahoo.fr

Notes
1. An International Action Plan aiming to prevent, deter and eliminate illegal, undeclared and unregulated fishing: UN Food and Agriculture Organization, 2001.