Quota concentration in the New Zealand fishery: Annual catch entitlement and the small fisher

New Zealand's quota management system (QMS) was introduced in 1986 to enhance the sustainability of New Zealand's fishery. This paper examines trends in quota and catch share concentration across a range of important fish stocks. It demonstrates that continuing concentration is occurring in the ownership of quota for deepwater species. At the same time there has been an increase in participation by small scale fishers in the inshore fishery. This appears to be driven by the introduction of the Annual Catch Entitlement (ACE) regime, allowing annual catch shares to be accessed at reduced transaction cost.     

Deemed value arbitrage in the New Zealand annual catch entitlement market

New Zealand's Quota Management System (QMS) consists of a two tier operational structure: Quota shares in a fishstock provide an Annual Catch Entitlement (ACE) of the total allowable commercial catch (TACC) of the specific fishstock. Fishers operating in a multispecies fishery need a portfolio of ACE that matches the mix of their annual catch. Fishers may own quota shares, and thereby receive the needed ACE allocations or they may operate without quota shares and rely on acquiring ACE in the ACE market. Whatever the fisher's situation, it is common for fishers to both buy and sell ACE during a fishing year as they seek to balance their actual catch against ACE. The incentive to achieve a balance is strong because at year-end fishers whose catch exceeds ACE are required to pay a fee called ‘deemed value’. For many fishstocks the deemed value fee increases sharply as the percentage by which a fisher's catch exceeds their ACE increases. When no ‘unbalanced’ ACE is available for purchase, an overfished fisher may attempt to mitigate their deemed value liability by engaging in arbitrage trading in ACE whereby they buy ACE from other overfished fishers. This study examines the nature and extent of ACE arbitrage behaviour in the New Zealand quota managed fishery. The study finds that the number of fishstocks where arbitrage trading occurs is relatively small and is declining. However, sizeable deemed value mitigation transactions are still evident.     

Challenges for New Zealand's individual transferable quota system: Processor consolidation,fisher exclusion, & Māori quota rights

This paper identifies three management initiatives in New Zealand's Individual Transferable Quota system that facilitated consolidation of the processing sector and limited market access for fishers, even those with quota rights. They are: (1) the placement of responsibility onto a Māori trust in 1992 and tribes (iwi) in 2004 to manage a limited amount of quota to benefit all Māori, fishers and non-fishers, which increased the use of quota as an investment asset; (2) the creation of Annual Catch Entitlement (ACE) as a fish access right separate from the quota ownership right, which made it possible to overcome consolidation limits by leasing ACE; (3) the 1997 Licensed Fish Receiver Act that made it illegal for fishers to sell fish off the boat without food safety certification. This account of the fishery policy environment in New Zealand explains why, despite owning significant portions of New Zealand's fishing quota, few Māori are fishing, processing, or selling fish caught by Māori quota.     

Efficiency of the New Zealand annual catch entitlement market

Balancing catch with annual catch entitlement (ACE) is crucial both for the financial viability of fishers and for the efficient operation of the New Zealand quota management system (QMS). This study examines the information channels that are used by fishers to search for ACE availability, and notes how these channels differ between large and small fishers. Special attention is given to the viability of small independent fishers whose participation in the fishery is dependent on their acquiring ACE in the open ACE market. An ACE market survey along with extensive consultation captured the views of fishers, fish processors, and quota brokers. These sources provide valuable insights into the day-to-day operation of the ACE market. They suggest that while elements of market power are evident in the ACE market there are also characteristics of an efficient market.     

Changes in fishing behaviour of two fleets under fully documented catch quota management: Same rules,different outcomes

A Dutch pilot study of fully documented fisheries provided the opportunity to observe actual changes in fishing behaviour under catch quota management (CQM). Interviews with fishers in the pilot study aided in interpreting the results and giving insight in the decision making process and reasoning of fishers. The CQM pilot study entailed a fleet of small and large demersal vessels. For these vessels, all cod catches were counted against quota, including catches of individuals below minimum landings size. To obtain reliable catch data all vessels were equipped with electronic monitoring (EM) systems. These systems recorded videos of all fishing and processing activities on board. In return, fishers received a 30% quota bonus for cod and were compensated with more flexibility on effort regulations. It was hypothesized that vessels in the CQM will (i) increase their landings by 30% according to their quota bonus, (ii) increase the use of gear with large mesh size, and (iii) change effort towards fishing locations with high catch rates of large cod and avoid areas with high catch rates of undersized cod. The results showed that CQM had no effect on fishing behaviour of the small vessels. In contrast, large vessels significantly increased their cod landings (216%) and avoided undersized cod. This difference in response of different fleets suggested that implementation of CQM, for instance in the context of the European Common Fisheries Policy, should consider fleet characteristics. It seemed that larger vessels in this study more easily adapted their behaviour to new management regimes and that the quota bonus opened up new fishing strategies, that were not envisaged during the implementation.     

The demise of the small fisher? A profile of exiters from the New Zealand fishery

New Zealand's exclusive economic zone encompasses a significant fishery that is managed by a market-based quota management system. Since the introduction of this regime in 1986 over 3000 fishers have exited the industry. These exiters are predominantly small-scale fishers. This study profiles a sample of the exiters, using information provided on the Ministry of Fisheries database and through a questionnaire sent to the exiters themselves. The profile includes information on the scale of exiters, their typical methods of fishing, the importance of time and exit price to the exit decision, and post-exit employment outcomes.     

Compliance costs and the small fisher: A study of exiters from the New Zealand fishery

Over 3000 predominantly small-scale fishers have exited the New Zealand's quota management system (QMS) between its inception in 1986 and 2000. This study, based on the Ministry of Fisheries database and a questionnaire sent to the exiters, establishes that compliance costs in general, and those specifically related to the QMS, were one of the most consistent reasons for exit. Uncertainty about future QMS policy and the high cost of quota were also significant factors. It appears that the small fishers’ perception of high compliance cost can be supported by industry data.     

New Zealand's indigenous people and their claims to fisheries resources

New Zealand's fisheries are perhaps best known for the individual transferable quota (ITQ) system brought about by the Fisheries Amendment Act 1986. The 1986 Act allocated quota to fishing firms and individuals that met the allocation criteria. Part-time fishers, many of whom were Maori, New Zealand's indigenous people, were excluded from the initial allocation. The 1986 Act did not address claims by Maori of having indigenous rights guaranteed by the Treaty of Waitangi 1840. Since the Treaty, Maori have protested against government actions and legislation that have eroded their rights guaranteed by the Treaty. The implementation of the 1986 Act prompted further Treaty-based claims to large areas of fisheries, and the ITQ system was used to settle several claims. This paper explores Maori views on resource use and claims to fisheries resources, legislative changes enacted to settle Maori fisheries claims, and claims that remain outstanding. The insights of this paper have relevance to the broader discussion on the position of indigenous peoples throughout the world.     

Industry response to the 2003 set net restrictions for protection of Maui′s dolphin

Marine reserves and gear restrictions are common forms of marine resource management; they impact on fishers both directly and indirectly. In 2003 New Zealand set net fishers were required to abandon set netting along a substantial section of the North Island′s West Coast in order to eliminate the chance of entangling the critically endangered Maui′s dolphin. A study of some 100 set net fishers, found that the immediate, and short term effects of the 2003 set netting area closures had little impact on the catch and effort levels of fishers. Participation in the fishery increased immediately prior to the restrictions and remained at a similar level for the following four years. Incumbent fishers performed better than new entrants and exiters. Trends in Annual Catch Entitlement (ACE) prices appear not to have been affected by the set net restrictions.     

Incentivising selective fishing under a policy to ban discards; lessons from European and global fisheries

The reduction of discards in European fisheries has been identified as a specific objective of the reform of the EU Common Fisheries Policy. To reduce the uncertainty in catch data and the socially unacceptable waste of resources that results from the disposal of catch at sea, a policy to ban discards has been proposed. Discard bans are currently implemented in Alaska, British Columbia, New Zealand, the Faroe Islands, Norway and Iceland. Experience from these countries highlights that a policy of mandatory landings can result in a reduction in discards, but relies upon a high level of surveillance or economic incentives to encourage fishers to land more of their catch. Discard bans will also not result in long term benefits to stocks unless total removals are reduced, through the avoidance of undersized, non-commercial or over quota catch. Experience shows that additional management measures are required to incentivise such a move towards more selective fishing. Success has resulted from the use of area closures and bycatch limits, with potential applications in EU fisheries. However, selective fishing will not be a panacea for the current state of European fisheries; discard bans and accompanying measures must be embedded in a wider management system that constrains fishing mortality to reasonable levels before sustainable exploitation can occur.     

Catch shares have not led to catch-quota balancing in two North American multispecies trawl fisheries

Catch shares, where annual catch limits are divided among individuals, communities or cooperatives, are a commonly used fisheries management strategy to increase profits and reduce overcapitalization. Usually these quota shares can be sold or leased, which is theorized to allow for greater utilization of fleet-wide quota. However, this catch-quota balancing may not be achieved in multispecies trawl fisheries where it is difficult to selectively target valuable species while avoiding overfished species. Two similar catch-share-managed, multispecies trawl fisheries were compared to evaluate whether catch shares lead to catch-quota balancing. The U.S. West Coast Groundfish fishery has several species with low total allowable catches (TACs) while the Canadian British Columbia Trawl fishery has comparatively higher TACs. Results indicate that the West Coast fishery had a statistically significant decrease in catch-quota ratios from 0.41 in the three years before catch shares to 0.29 in the three years after catch shares. In contrast, the BC fishery experience no statistically significant change in fishery-wide average catch-quota ratios, which were 0.70 in the three years before and 0.62 in the three years after catch shares. In the West Coast fishery, the risk of exceeding quotas for some species may be so high that fishers are unable to achieve high degrees of catch-quota balancing and instead focus on species that can be easily selected with changes in fishing behavior. Multispecies fisheries management has direct tradeoffs between maximizing yield and achieving conservation goals, and these results may highlight the tradeoff between rebuilding overfished species by reducing TACs, and the achievement of catch-quota balancing.     

Opportunities and barriers for industry-led fisheries research

Collaborative research initiatives between New Zealand's fisheries management agencies and commercial fisher organisations are commonplace. This can be attributed to a combination of fisheries management institutions and processes that on the one hand create incentives for commercial fishers to take increasing responsibility for fisheries research and on the other hand provide for governance structures that ensure the transparency and integrity of industry-led research. Nevertheless the full potential of collaborative research initiatives has yet to be realised. Collaborative research has been an indirect outcome of New Zealand's rights-based fisheries management framework and until recently there has been little effort to explicitly provide for it in Government policy. The financial and management capacity of commercial fisher organisations must also be developed if collaborative research is to become a core function of these organisations. High expectations have been created for collaborative research and failure to address key issues will undermine the potential and hence legitimacy of collaborative research involving commercial fishers and other fisheries stakeholders.     

Spatial dynamics of the South Australian rock lobster (Jasus edwardsii) fishery under a quota‐based system

The southern rock lobster, Jasus edwardsii, is South Australia's most valuable fisheries resource, with an annual landed value of c. AU$100 million. Approximately 80% of this revenue comes from the southern zone (SZ) rock lobster fishery, which has been managed under an individual transferable quota system since 1993. The total allowable commercial catch is currently set at 1900 tonnes. Long‐term spatial trends in catch and effort were analysed over the period 1970–2005 to investigate possible changes in the spatial dynamics of the fleets as a result of quota introduction. Data indicate that the fishery contracted into three main Marine Fishing Areas (MFAs) after 1993. In particular, the long‐term catch average in MFA 51 decreased from 185.4 tonnes pre‐quota to 59.8 tonnes post quota. This MFA is located in the northern region of the SZ and is one of the furthest MFAs from the main fishing ports in the region. The fishery is also spatially contracted within MFAs. Approximately 80% of the annual catch comes from <60m depth despite catch rates being 2–3 times greater in offshore sites as evidenced from both fishery‐dependent and independent sources. Such trends appear driven by recent market preferences that select for small (<1 kg), red‐coloured lobster that are primarily located on inshore grounds. As a result, fishers now target inshore sites to maximise returns under the quota‐based system. The observed shift in the spatial dynamics of the SZ has clear implications for the biological performance indicators on which the fishery is managed. Specifically, the results highlight the need for a fishery‐independent assessment of the resource that provides estimates of catch rate and biomass independent of current harvest strategies. Preliminary results from a trial survey undertaken in 2005/06 and 2006/07 show higher lobster abundance in lowly exploited offshore sites compared with inshore areas. These trends highlight the need for refined spatial management of the resource, which is the focus of the new management plan for the fishery.     

Private rights,public benefits: Industry-driven seabed protection

New Zealand has a large exclusive economic zone (EEZ) that contains a variety of marine habitats and commercially-important species. The commercial fishing industry operating within New Zealand's EEZ is of significant value to the economy and fisheries resources are managed through the extensive use of Individual Transferable Quotas (ITQs). One of the benefits of ITQs has been to better align some of the private incentives of quota owners with the public interest. These incentives contributed to an initiative proposed by the fishing industry to close large areas of New Zealand's EEZ to protect the seabed from trawling. These closed areas are termed benthic protection areas (BPAs) and protect the benthic biodiversity of about 1.1 million square kilometres of seabed—approximately 30% of New Zealand's EEZ. A significant proportion of New Zealand's known seamounts and active hydrothermal vents are protected by these closed areas. We describe and discuss the criteria used to select BPAs and some of the criticism of this marine protection initiative. We argue that the assignment of strong property rights in fishing resources was an important precondition to an industry initiative that has a significant public benefit. Where private and public interests are well aligned, government can adopt an enabling and facilitation role, ceding direct control of processes in order to get the results the align with the public interest.     

Is the catch quota management (CQM) mechanism attractive to fishers? A preliminary analysis of the Danish 2011 CQM trial project

There is a demand for a management mechanism that can reduce the discarding problems of EU fisheries. Catch quota management (CQM) seems to be a promising candidate for such a mechanism. Drawing on a principal–agent model, the objective of this study is to develop and test a method for investigating if the CQM mechanism is efficient in providing fishers with incentives for participating in CQM and complying with the rules. The study uses the 2011 Danish CQM trial project as its empirical basis. The results indicate that CQM fishers have a higher average gross income compared to fishers harvesting according to the conventional rules. Hence, there is an incentive for fishers to participate in the trial. However, with the possibility to cheat, CQM fishers may achieve even higher gross income. It is not obvious that the CQM mechanism׳s payoff structure (incentives) is attractive enough to ensure that the fishers comply with the rules. The empirical data illustrate that without discarding the CQM fishers achieve a lower average price for their catches. Therefore, to make the CQM mechanism sufficiently attractive to fishers, the participating fishers must be compensated.     

Sharing the catch or catching the shares: Catch shares for the western Pacific region?

The applicability of catch shares programs is evaluated for the various fisheries of the Western Pacific Fishery Management Council region in each of the archipelagoes. Implementation of Catch Shares programs in the region is problematic, but would require better data to be done fairly and equitably. Catch shares are currently under initial consideration for the Hawaii and American Samoa longline fisheries and the Hawaii Deep 7 bottomfish fishery. It is argued that current conditions in all the other small boat fisheries in the region make them inappropriate for catch shares management. Overfishing and the “race for fish” are not yet an issue for these fisheries and some are underdeveloped. Catch share programs can cause significant negative social consequences for Western Pacific communities because data on fishermen's participation, catch histories, and motivations to fish for cultural needs is not adequate for any initial allocation scheme to be developed equitably. The prevailing Western Pacific cultural value of sharing the fish by gifting portions, sharing the catch widely and sharing fishing opportunities widely is in clear conflict with the individualized commercial profit motive philosophy of fisheries that are appropriate for catch shares. The small boat fisheries lack adequate monitoring and enforcement, and do not have a total allowable catch or quota. Nor do they usually have a demonstrated need for one. Preliminary community outreach by Council staff and community discussion of catch shares shows a general lack of information yet a potential for strong resistance to the imposition of catch shares.     

Social,economic and trade characteristics of the elasmobranch fishery on Unguja Island,Zanzibar, East Africa

Understanding the socio-economic drivers underpinning fishers' decisions to target elasmobranchs is considered vital in determining sustainable management objectives for these species, yet limited empirical data is collected. This study presents an overview of elasmobranch catch, trade and socio-economic characteristics of Zanzibar's small-scale, artisanal fishery. The value of applying this information to future elasmobranch fisheries policy is demonstrated. In August 2015, interviews were conducted with fishers (n = 39) and merchants (n = 16) at two landing sites, Kizimkazi-Dimbani and Mkokotoni, along with the main market site in Stone Town. Additionally, elasmobranch catches were recorded across the same locations between June and August 2015. Elasmobranchs were listed as target species by 49% of fishers interviewed. Whilst most fishers (n = 30) stated that 76–100% of their household income came from fishing, there was variation in how elasmobranch catch and trade contributed. One-third of fishers (n = 36) that caught and sold elasmobranchs reported that 41–60% of their income came from elasmobranch catch. However, for some fishers (n = 8) elasmobranch catch represented 0–20% of their income, whilst for others (n = 4) it represented 81–100%. Differences in fisheries income and elasmobranch price could be attributed to several interacting factors including season, weather, fishing effort, fishing gear, target catch and consumer demand. Further, elasmobranch price was influenced by size and species. The study revealed information on catch, trade, markets and socio-economy that is important for future research, conservation and management of elasmobranchs and fisheries in Zanzibar. The methods utilised have potential for broader application to understudied, artisanal elasmobranch fisheries in the western Indian Ocean.     

Sustainability in New Zealand's quota management system: A convenient story

New Zealand's fisheries management institutions represent a globally recognised story of a successful sustainable management regime, an accolade perceived to be based on its early and comprehensive adoption of a quota management system (QMS). This article questions these assumptions. There are three main strands to the argument. First, that the interpretation of sustainability in the New Zealand QMS disregards the social while simultaneously accentuating a particularly neoliberal economic paradigm in which sustainability is directed towards sustaining the wealth generating potential of quota holdings. Second, while in theory there is a separation of biological and economic conceptions of sustainability in the QMS, these processes are, in fact, deeply intertwined. Third, that the sustainability brand works to legitimise the privatisation and marketization of marine environments, to protect the income stream of quota investors, and to effectively incorporate and discipline dissent.     

Catch share programs in the Western Pacific—A solution in search of a problem?

The movement toward catch shares by NOAA Fisheries and fisheries managers worldwide responds to dysfunctional fisheries plagued by a host of interrelated problems including radically shortened seasons, a race to fish, supply gluts, lowered product quality, increased bycatch, safety issues, excess capacity, and lack of profitability. However, the NOAA Catch Shares Policy recognizes that catch shares are not appropriate for every fishery, and others have agreed that the success of catch shares programs depends on their fit with ecological, economic, and social characteristics. This article describes the characteristics of the Hawaii-based deep-set longline fleet, identified by NOAA Fisheries as a possible candidate for catch shares because it operates under a bigeye tuna quota instituted by the Western and Central Pacific Fisheries Commission. One of the main concerns in the fishery is the potential for closing during the holiday season, a culturally important time for fish consumption in Hawaii. An evaluation of the fishery suggests that many of the problems leading to development of catch shares programs in other fisheries are not present, but that some warning signs exist which could be addressed by catch share programs or other management alternatives.