Review of Management Options for the Landing Obligation

Section 6: Monitoring and Enforcement

6.1 The landing obligation presents a number of crucial challenges regarding monitoring and enforcement. An academic interviewed stressed that as it embodies a shift from the monitoring and regulation of landings to catches, it is fundamental to know exactly what is being caught. A discard ban is harder to control than landings regulations or illegal landings as discarding as it is an event that happens at sea. Within the interviews, there was a strong consensus that the landing obligation will require new, improved and more intelligent monitoring, control and surveillance mechanisms. The issue is not just with monitoring what is brought on board and retained but with what is being discarded under the allowances and flexibilities. A point put forward by STECF is that there may be limited opportunities for verification of the discarded catch under the de minimis and survival provisions, with this situation requiring a fundamental review of the roles of scientific observers.

6.2 Within the CFP framework, the Scotland Government has a significant degree of latitude in terms of the design and implementation of monitoring and enforcement mechanisms for the landing obligation. What will be measured from a European level is whether or not a Member State's method is seen to be enforcing the landing obligation. If the EC believes that the landing obligation is not being enforced in a Member State, it is likely to be proactive in penalising said state and it will be monitoring the progress closely. Identified options and their likely impacts are discussed below.

6.3 Effective monitoring and enforcement of the discard ban is necessary for several reasons:

• Compliance: The behaviour of individuals will be influenced by the cost of the alternatives at the margin. The price of discarding illegally therefore has to be perceived as high, or at least higher than the cost of purchasing additional quota. The cost of discarding will be informed by monitoring and enforcement and the practicalities of the control measures put in place. This is crucial as the incentives for non-compliance will be significant for those vessels faced with the prospect of going out of business.
• Improved selectivity: The first approach in helping the fleet weather the discard ban is to improve selectivity as this will help vessels avoid the catching of undersized and unwanted species. While the industry is often supportive of selectivity improvements, there is often a waning in the practical application of the technology as it is often perceived by the industry as costly, with it commented that the gear often lets targeted as well as the intended non-targeted fish escape. In order to create strong economic incentives for vessels to adopt greater selectivity (in gear and fishing behaviour), it is crucial that vessels experience the economic constraints of the discard ban upon their operations. It is through this pressure that behaviour can be altered. If illegal discarding still occurs, the potential of this incentive structure will be nullified.
• Avoid a return to precautionary TACs: A potential outcome is that if illegal discarding takes place under the landing obligation, a return to precautionary TACs could be triggered- TACs that hold back a proportion of the total catch to cover estimated discards. While there is great fear over the financial impact of the landing obligation, even with the uplift amounting to often 100% of species quotas, a subsequent reduction or removal of this would be financially disastrous for the fleet. Weathering the short-term economic hardship that will result from a high level of control is therefore crucial to the long-term operation of the fleet.
• Creating medium-long term security: A point made by one industry representative was that landings will likely increase with the uplift. If the fleet is allowed to operate in an open system- one without adequate monitoring under which discarding continues- the pressure upon mortality will increase which will lead to future stocks going down. This would be exacerbated if other controls upon effort were removed in order to give the fleet the freedom to fit into the new system. In order to prevent this, it was commented that it is crucial for the government to be tough and control the fleet in order to protect the medium-long term operations of the fleet. The point made was that the government cannot assume that the fleet, unmonitored, will behave under the landing obligation and that the government has to be tough or else the industry will not change its behaviour.

Mechanisms and Tools for Effective Monitoring

Remote Electronic Monitoring

6.4 A Remote Electronic Monitoring ( REM) system has been proposed by the EC (2011b:8) as a method for monitoring and enforcing the landing obligation. REM uses CCTV, hydraulic sensors and VMS data to record hauling and sorting activities. The hydraulic sensors can be used to identify at which points in the footage this activity occurred and VMS to cross-check against electronic logbook data. REM systems are used in Denmark, the US and in the Scottish Catch Quota Scheme. In Denmark, REM has been used as a key component in a project designed to reduce bycatch and discarding. Vessels who agree to electronic monitoring are rewarded with a catch quota- a quota uplift that carried the stipulation that every vessel must register all catches and discards, with discards counted against individual quota and only fish under the minimum size allowed to be thrown overboard. The Danish project has been described as radical in its use of the economic incentive of an uplift to encourage vessels to accept monitoring. The use of catch-quotas has been reported to be " a very desirable incentive for the fishers who are willing to take full responsibility for documenting their actual catches and thereby also discards" (Gezelius, 2008). The Danish project indicates that high-quality video monitoring is possible which could aid the monitoring of the catch composition and help with prosecution of offenders.

Potential Impacts and Effectiveness

6.5 In the interviews, the industry's perception of the effectiveness of REM was to generally see it as limited. Specific points were raised concerning the system's value for money and general effectiveness as it was commented that crews would be tempted to turn the equipment off or cause it damage. Aside from these partisan observations, a genuine concern from the industry was the effect that the legitimate use of REM would have upon the demersal sector, with this leading to the fleet being tied up quickly and the economic ramifications of this. As one interviewee stated, all that cameras would see were vessels filling up in two days rather than four.

6.6 The industry's resistance to this tool is interesting as it provides some perspective on the potential effectiveness of REM for monitoring catches and enforcing the landing obligation. In effect, it is likely that REM would prove instrumental in effectively enforcing the landing obligation.

• Demersal fleet: The key issue regarding REM lies with the impact of an effective landing obligation upon the demersal fleet. The known reality is that if full control is realised there is the potential for a large number of vessels to be tied up half way through the year, with this likely to occur if there was full control of hake catches within the North Sea. The issue is not only the strong resistance that comes from these fleets, but the wider social, economic and political issues as this would disrupt the whole supply chain.
• Pelagic fleet: For the pelagic fleet, circumstances are different. In response to increased evidence of slipping, it was commented in one interview that there is a general consensus within the scientific community that the use of REM is the only way to enforce the discard ban amongst the pelagic fleets, especially given the failure of the 2011 high-grading ban. In preparation for their consultation on pelagic sector, Defra have revealed that all English pelagic vessels over 24m in length will be monitored by REM, with these three vessels covering 90% of the sector's fishing mortality. The monitoring of the landing obligation on the Scottish pelagic sector through REM will be relatively straight-forward as even with full monitoring and enforcement it was referenced by several in the interviews that the businesses in this sector will be unlikely to face bankruptcy as a result.
• Other sectors: One interviewee commented that it is important to remember that some sectors actually have a lot to gain from the installation of cameras and may take them voluntarily. An example given was prawn trawlers that operated in the Firth of the Forth. It was noted that cameras can be used within this fishery to demonstrate that cod represents less than 1% of their catch composition. This would then be used to argue that these vessels should not be constrained by DAS as they were not damaging cod stocks. Ultimately, the point is that cameras may be viewed as a beneficial tool for some vessels as they will verify what is going on and support good behaviour and fishing practices.

Discussion

6.7 Excluding the POs and one Fishing Association, a consensus within the interviews was that the use of REM was the only way to achieve effective enforcement. Within this cohort, the general narrative was that electronic monitoring was the only tool that was capable of monitoring a high enough percentage of catches and to carry this out at sea. The issue is that the use of REM is unpopular amongst the industry. This stems from the likely success of REM in monitoring catches as it will work to effectively drive home the economic costs of the discard ban upon individual vessels.

6.8 A crucial outcome of the interviews was that while the economic impact of REM upon the demersal fleet was well understood, from all parties not representing POs, a strong belief was that the solution to this came not from side-stepping REM but instead from changing how quota for this sector was managed. The principle reason for this was to make sure that the economic incentives to alter behaviour are not avoided.

A Solution: Design innovative benefit schemes

6.9 While the use of REM remains a contentious issue, the solution put forward by several experts is to design a series of innovative benefit schemes in order to facilitate a progressive approach towards the management of the landing obligation.

• Ring-fencing quota: An option exists for the government to ring-fence quota and use it to create carrots to reward and incentivise specific behavioural changes. The Scottish Government could adopt the Danish approach and allow vessels that agree to REM access to the uplift, with the option of two ramped rates for those with and without REM. Under this mechanism, the degree of access that individual vessels have to the buffer quota could be based upon monitoring provisions. One academic interviewed commented that the quota uplift has in many ways gifted Member States with a unique carrot to create fundamental progressive change in how fisheries are controlled. However, this needs to be used from the start. It is likely that if the political will is present at the beginning to use uplift or quota in such a manner, this will be regretted in the future as change may have to be forced upon the fleet without this economic and political safeguard.
• European-led change: A comment reiterated in the interviews was that unless the use of REM is rolled out across Europe, there will be little incentive for governments such as Scotland to adopt it for their own fleet. With fishermen tending to be conscious of the operations of others and what is going on around them, the creation or perception of a 'level-playing field' is vital for compliance. Incentives and pressures should therefore operate at a European or regional level. One option suggested was that at a European level, Member States should be awarded only 90 per cent of their quota, with the other 10 per cent allocated out if the Member States uses REM to facilitate full control. While 10 per cent was referred to within the interviews, further research could be conducted with the industry to ascertain the level required to produce a sufficient incentive.
• Creating the right package: Another recurring theme within the interviews was that REM could be sold on a sector by sector basis if the right 'package' of carrots and sticks was presented. For a sector such as the pelagic fleet it could be access to the full catch quota; for vessels that have low-nil discards, such as the prawn trawlers mentioned, it could be the removal of Days at Sea restrictions; for others, specific gear restrictions. One interviewee commented that for the demersal fleet, it is unlikely that such a package exists right now. However, it was believed that a key to unlocking this could be innovative ways in which quota could be accessed for unintentional bycatch. For instance, one of the pooling mechanisms discussed that allowed vessels to drawn down from in order to keep them at sea for longer. In essence, the fleet needs the security to operate under REM.

Observer Programmes

6.10 An alternative system would be to create observer schemes which would place certified observers on vessels in order to visually monitor and report upon a vessel's catch and what species and size of fish it was discarding. An observer programme is used to enforce the discard ban in Norway, however the efficacy of this is questionable as illegal discarding is suspected in Norway. Nonetheless, successful observer schemes do operate in the US and Canada, with the success of these models resting upon the fact that 100 per cent of every vessel's activity is covered by an observer (Condie, at al., 2013).

6.11 Revealed in interviews with fisheries managers and fishermen in the US and Canadian fisheries is that while observer schemes were chosen as the initial monitoring mechanism, there have been recent attempts to move towards an REM system. The reason for this shift appears to be primarily financial. In the US and in Norway, the high cost of observer schemes was initially financed through public subsidy paid by the government, with the intention that these subsidies would gradually be removed. In the Norwegian case, the intent was that the industry would eventually cover 100 per cent of the costs of the scheme, with this increasing in increments of 10 per cent per year. A movement towards REM has become popular amongst the industry as public funding has been reduced in the US and Canada.

Potential Impacts and Effectiveness

6.12 Currently, Marine Scotland observes less than 1 per cent of vessels' activities. If an observer programme was to play any pivotal role in Scotland's monitoring and enforcement of the landing obligation, this would have to be substantially increased, and the current scientific observers replaced/supplemented with control observers. As commented by fisheries managers operating observer programmes, anything less than 100 per cent coverage creates incentives for discarding as well as animosity between fishers as a level-playing field is not in operation. In terms of the resources this would require, this is exacerbated by the need to have two observers on board (to cover the EU Working Time Directive) to ensure that there is always at least one observer monitoring trip activity. This would create high administrative costs, with US and Canadian fisheries reporting that monitoring costs are $500 per day per vessel, with similar figures put forward by the EC (2011b:6) for Norway. It is estimated that Norwegian authorities carry out 2,200 boat inspections a year at a cost of £86 million (MRAG, 2010).

6.13 There are also several practical difficulties with the effectiveness of observes schemes. Under EU law, observers are allowed on board only following invitation and with the agreement of the skipper and observers have no enforcement rights. During attempts to enforce the 2011 high-grading ban, observers were often denied access to vessels. Overall, with less than 100 per cent coverage, there would be ample opportunity for fishermen to continue discarding when they are not being observed and to toe the line when they are. If observers were denied access, this would generate a great deal of uncertainty as to illegal discarding levels.

Discussion

6.14 In respect to control, a strong consensus within the interviews was that observer schemes are not relevant to Scotland. It is likely to be extremely costly, impractical and ultimately not an effective policy

Industry Mechanism/Reference Fleets

6.15 One system put forward by a PO was based upon the use of the current observer schemes that are being launched by the industry that are attempting to establish the levels and patterns of discarding at present. The idea is that this data would be used to put together a comprehensive picture of discarding patterns as to ascertain what true catch compositions different fleet segments tend to obtain. The role for compliance would then be to check that the landed catch of vessels correlated to the expected picture. If there is a discrepancy, observers should then be put on board.

6.16 There are several issues with this system. Firstly, it is reactive to bad behaviour as opposed to creating incentives for good behaviour and it is inevitable that some degree of discarding will continue, with fishermen likely to become aware of what landed compositions they can get away with. This would produce a 'leaky' system of compliance which would undermine the creation of the much needed incentives for better selectivity and compliance.

6.17 This system is quite similar to the use of reference fleets, which have been discussed within the RACs and STECF. A reference fleet is a set of vessels operating in a fishery which represents the entire fleet. This system is used in Norway, with the vessels used considered to especially trustworthy. The issue with this sort of monitoring and enforcement system, as STECF point out, is that it does not create a level playing field within the fishery- which the reference fleet are fully monitored; the vessels outside of this are not directly monitored and therefore have fewer incentives to comply.

Enforcement

6.18 A component of how well the discard ban will work depends upon the budget given to the compliance team, this is ultimately a Ministerial decision and therefore has the potential to be driven by a political value judgement. The position of Marine Scotland Compliance is that it will enforce the landing obligation to the best of its ability given the resources made available. If mechanisms to implement full control are not given a high degree of political backing, it will aim for strategic measures that can target vessels in such a way as to maximize the impact of enforcement.

Penalties for illegal discarding and illegal landings

6.19 As well as boarding and the seizure of illegal catches, there is a strong case to be made for implementing strong financial penalties for illegal discarding and illegal landings. The potential exists for the government to create mechanisms which will allow the fleet (in particular, demersal vessels) controlled access to additional quota if catch is caught accidentally. However, if vessels continue to catch (and land) catches in excess of original quota holdings and the allowances cannot be covered by quota sourced on the market, it is important that the financial penalty for this is high. Hatcher (2013) demonstrates that in a mixed species quota fishery affected by choke species, if the expectation is of a large penalty for discarding or landings illegally, this will create incentives for more selective fishing. If the cost of discarding is positive but less than the cost of landing illegal catch, fishers will be likely to avoid bycatch but continue discarding the choke species. This implies that the most effective way to alter a fisher's behaviour towards greater selectivity and compliance is the implementation of large penalties for discarding and landing over quota fish. The issue is not just that illegal discarding will occur, but that vessels will land illegally and in order to cover this illegal catch, unused quota will have to be taken from other operators. This has the potential to undermine any security attached to the 'right to fish' which would ultimately undermine the collective response to the choke species problem that could be fostered through the use of Risk Pools and Buffer Zones and exacerbate the incentive for non-compliance.

Bottom-up Enforcement: Demonstrating the right to catch before leaving harbour

6.20 As discussed in paragraphs 5.33-5.35, the POs interviewed put forward the option that vessels would have to demonstrate the right to catch (adequate of quota holdings relative to expected catch) before they can leave harbour. This option received a broad base of support from the POs, academics and industry-related organisations.

Discussion

6.21 It is crucial that the landing of illegal catch (for which no quota is held and buffer pool like allocations have been exhausted) is met with severe financial repercussions and repeat offenders face stricter penalties such as the suspension and removal of licences. This tougher enforcement stance towards a discard ban is seen in Iceland, where illegal discarding and illegal landings are met with financial penalties, the revoking of fishing rights and even jail sentences (Johnsen et al 2007). Despite this, low levels of discarding still occur (Condie et al, 2013). In comparison, in Norway legal action is only taken when the catch is demonstrably caught on purpose- such as in closed areas if it is not reported. As already covered, in New Zealand a tax is placed upon illegal landings. What seems unclear, however, is where the authorities find the quota to cover these illegal landings. The bottom line is that even if financial penalties are placed upon illegal landings, the catch still needs to be covered by quota from within the system.

6.22 One possibility put forward within the interviews was of creating some sort of transition period for enforcement, where strong enforcement could be aimed for but the initial years of this would factor in some room for lenience in order to avoid the widespread criminalisation of fishermen overnight. This would represent a structured period of reasonable tolerance, with specific levels of tolerance allowed. The issue is that while most new management regimes do follow some sort of transition period, the view from Marine Scotland Compliance was that the time from now 2014 until the implementation dates was the transition period, and this would not hold for the landing obligation.

6.23 While the likelihood that vessels will have their operations constrained by the landing obligation is viewed as an anathema, it was commented by two separate interviewees that if this does not occur, and vessels are not forced to stop fishing, it is likely that something will be wrong from a compliance perspective. In this situation, it is likely that fishermen will be discarding illegally. A carrot and stick approach to monitoring and enforcement was held as a progressive approach, with a common theme displayed in the interviews that there was the need for a perception from the beginning that the ban is being enforced. Moreover, that there has to be an expected financial cost to illegal discarding and illegal landings and that such actions will be met with some degree of financial repercussion. The general theme was that if a high financial cost if not associated with non-compliance, it is unlikely that the required change in behaviour towards more selective fishing will not be generated.

Section Summary

6.24 A discard ban is harder to control than landings regulations or illegal landings as discarding is an event that happens at sea. It was stressed within the interviews that effective monitoring and enforcement could play a vital role in creating the economic conditions that will produce compliance and a shift towards more selective gear, as well as working to safeguard against a future return to a pre-cautionary TAC.

6.25 The attitude towards the use of REM was split: while the industry tended to view it as having limited effectiveness, it was argued in all the other interviews that it presented the only effective method for monitoring the landing obligation. There was broad support for the use of REM in the pelagic sector, with a key reservation the economic impact upon the operations of TR1 and TR2 vessels. This could be taken as suggestive evidence that REM represents an effective tool. In working to overcome the industry's distaste for REM, the general solution put forward was for the use of benefit schemes, tailored at a fleet to improve the security of operations under REM.

6.26 The interviews showed very little support for an observer scheme, with one fishing Association putting forward the option of a Reference Fleet Mechanism.

6.27 Strong support existed across the board for monitoring and enforcement mechanisms that can help foster a level-playing field at a European level.

6.28 At a Scottish national level, a consensus was that unless the landing obligation is perceived as being enforced from the get-go and that illegal discarding carries a high financial cost, it is unlikely that the behaviour changes required (compliance and more selective fishing) will be generated. The most comprehensive solution was for use of financial penalties and effective monitoring to associate a high cost with illegal discarding.

6.29 Creating a strong perception that the landing obligation is being effectively enforced may help in cultivating social and moral pressures that can affect individual and group behaviour.