Trade Measures Potent Weapon For Fighting IUU Fishing

Date: November 14, 2016

Author: Nicki Holmyard

Illegal, unreported, and unregulated (IUU) fishing is widely acknowledged to be one of the fundamental issues preventing governments and regional fisheries management organizations (RFMOs) from achieving sustainable fisheries.

It can also have harmful impacts on sustainable development priorities such as food security, economic development and fighting organized crime.

A new study (Hosch, Gilles. 2016. Trade Measures to Combat IUU Fishing: Comparative Analysis of Unilateral and Multilateral Approaches. Geneva: International Centre for Trade and Sustainable Development) undertaken by Gilles Hosch for the International Centre for Trade and Sustainable Development (ICTSD), provides an analysis of the state of play and impact of trade measures used to address IUU fishing. These include catch documentation schemes and trade-restrictive measures adopted at multilateral level by RFMOs, and unilaterally by large markets such as the European Union and the United States.

It includes a series of recommendations that could help improve the effectiveness of trade-related measures and aims to provide a source of analysis and ideas for policymakers and stakeholders involved on all sides of the debate.

The paper suggests, for example, that governments might use regional trade agreements to enhance the coherence of any trade-restrictive measures they adopt to address IUU fishing, and that governments could consider developing a multilateral approach to these measures in the World Trade Organization.

Hosch acknowledges that using trade measures to address IUU fishing is a technically challenging and politically sensitive area of policy.

He points out that perspectives on whether and how these measures should be used vary tremendously, but argues that, since fish is one of the most valuable renewable resources traded globally, international trade policy should play a critical part in combatting IUU fishing.

Currently in use are trade restrictive measures (TREMs), also known as trade sanctions, and catch certification schemes, which comprise trade documentation schemes (TDS) and catch documentation schemes (CDS).

Since the early 1990s, TDS have been used by several tuna RFMOs to detect flag of convenience vessel operations (FOC) and to implement trade measures as a direct result. Consequently, IUU trade from FOC states including Bolivia and Honduras has just about stopped.

However, according to Hosch, more than 95 percent of IUU fishing operations in the most important tuna fisheries are carried out by legally registered and licensed fishing vessels, undertaking illegal activities such as misreporting or under-reporting of catches. He believes that these can be eliminated effectively by well-designed CDS.

Multilateral CDS are operated by three RFMOs, and enable the flag state to certify the legality of the harvest. One major benefit is that they are relatively simple to police and enforce and can be effective in eliminating under-reporting by otherwise compliant, registered, and licensed fleets. For example, under-reporting of Atlantic bluefin tuna is thought to have fallen from double the total allowable catch (TAC) to close to nil when important market states, including Japan, started to enforce the relevant CDS.

There is also a strong correlation between the introduction of the CDS systems and the beginning of recovery of affected tuna stocks. Such positive long-term economic benefits outweigh the short-term costs of enforcement.

CDS work by reducing the financial incentives to engage in IUU fishing, as product cannot be placed on the market without the correct paperwork. Hosch cites the examples of legally certified Patagonian toothfish achieving 20 to 30 percent higher prices than non-certified product, and non-certified Atlantic bluefin tuna in the Mediterranean reportedly losing 85 percent of its legal international market value.

The E.U. is currently the only region to operate a unilateral CDS, but a unilateral U.S. system will be operational in late 2016. However, the potential for direct positive impact on the sustainable management of individual stocks is greater with multilateral systems.

Because the E.U. CDS is paper based with no central data registry, its effectiveness in verifying traceability and excluding illegally harvested products from certified supply streams is limited. The U.S. CDS system will improve on this and initially target at-risk species.

TREMS are used in the E.U. in the form of yellow cards to identify and warn non-cooperating flag states, and red cards to ban imports across the board, regardless of the IUU activity that triggered the action. Four red cards have been issued since 2014 to flag states in Africa, Asia, the Caribbean, and the Southwest Pacific.

Whilst industrial operators have the option of changing their flag state, small-scale fisheries are unable to escape country-wide embargoes, so are disproportionately affected.

Hosch believes that the standards on which decisions are made in the E.U. system are unclear, but agrees that E.U. identifications have pushed some affected countries to improve their fisheries governance frameworks.

In the U.S., TREMs can target fleets, species or product types directly tied to IUU fishing. In addition, biennial reports with detailed information are submitted to Congress, although no sanctions have been implemented to date.

On balance, Hosch believes that the impact of unilateral TREMs on IUU fishing and fish stocks is potentially greater than that of unilateral CDS. He argues that if soft flag, port, and processing states can be pushed into becoming more responsible through transparent and fair trade-restrictive measures, then the impact of unilateral TREMs could be substantial.

In concluding, he states that RFMOs should be supported and strengthened so that they can continue to deliver and expand multilateral solutions to the problem of IUU fishing in shared fisheries. Unilateral end-market CDS may protect markets from sourcing a wide range of illegally harvested products, but because they close off only one market to IUU products, they may have limited overall impact on IUU fishing and the sustainable management of individual fish stocks.

The paper also makes a series of 10 recommendations for policymakers to help improve the effectiveness of multilateral and unilateral CDS and TREMs.

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