Tag Archives: Fishing industry

State aid for SMEs in the fisheries sector

State aid for SMEs in the fisheries sector

Outline of the Community (European Union) legislation about State aid for SMEs in the fisheries sector

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Competition > Rules applicable to specific sectors > Competition in agriculture and fisheries

State aid for SMEs in the fisheries sector

Document or Iniciative

Commission Regulation (EC) No 736/2008 of 22 July 2008 on the application of Articles 87 and 88 of the Treaty to State aid to small and medium-sized enterprises active in the production, processing and marketing of fisheries products.

Summary

This Regulation applies to aid granted to small and medium-sized enterprises (SMEs) in the fisheries sector. This aid is exempt from a case-by-case assessment on the condition that it complies with the previsions of the European Fisheries Fund (EFF) and the fisheries guidelines .

The categories of aid exempted pursuant to this Regulation are:

  • aid for cessation of fishing activities;
  • aid for financing socioeconomic measures;
  • aid for productive investments in aquaculture;
  • aid for aqua-environmental measures;
  • aid for public health and animal health measures;
  • aid for inland fishing;
  • aid for processing and marketing fisheries products and aquaculture;
  • aid for collective actions. This aid is for the financing of measures of common interest which are supported by operators, producer organisations or other organisations recognised by the Member States.
  • aid for measures intended to protect and develop aquatic fauna and flora;
  • aid for investments in fishing ports, landing sites and shelters;
  • aid for development of new markets and promotional campaigns;
  • aid for pilot projects;
  • aid for modification for reassignment of fishing vessels;
  • aid for technial assistance.

This Regulation does not cover:

  • aid the amount of which is fixed on the basis of price or quantity of products put on the market;
  • aid to export-related activities;
  • aid favouring domestic products over imported products;
  • aid granted to undertakings in difficulty to rescue and restructure them;
  • aid granted to an undertaking which is subject to an outstanding recovery order following a decision by the Commission declaring an aid illegal and incompatible with the common market.

Member States must ensure that the aid it wishes to grant does not affect trading conditions in a way contrary to the general interest. Aid granted is not subject to the notification requirement of Article 88, paragraph 3 of the Treaty establishing the European Community (EC Treaty). However, Member States must send a form of summary information detailed in Annex I of this Regulation in electronic format to the Commission for publication in the Official Journal of the European Union.

The amount of aid cannot exceed a maximum of EUR 1 million per beneficiary, per year or EUR 2 million per eligible project.

Cumulation of exempted aid under this Regulation with other aid of the same type is possible if the cumulated aid concerns different eligible costs within the maximum amounts detailed above.

Only aid with an incentive effect will benefit from the exemption of the aforementioned Regulation. Aid has an incentive effect when it enables beneficiaries to carry out activities or projects which they would not have undertaken under normal market conditions. For the incentive effect to be recognised, the beneficiary must submit an application for aid before the launch of the project or activities start.

Each year Member States must send a report in electronic format to the Commission. The information submitted must enable the Commission to verify that the exempted aid complies with transparency and exemption criteria.

References

Act

Entry into force – expiry date

Deadline for transposition into the Member States

Official Journal

Regulation (EC) No 736/2008

18.8.2008 – 31.12.2013

OJ L 201 of 30.7.2008

Reform of the Common Fisheries Policy

Reform of the Common Fisheries Policy

Outline of the Community (European Union) legislation about Reform of the Common Fisheries Policy

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Organisation and financing of the fisheries sector

Reform of the Common Fisheries Policy (Green Paper)

This Green Paper aims to collect the opinions of all persons and organisations affected by the future of the fisheries sector. Despite the measures taken to ensure the sustainable future of the sector, a large number of problems remain, such as overfishing, an increase in seafood imports, Community fleet overcapacity, decreased profitability of the sector and the dependence on public aid. The consultation is the first stage in the process which should lead a radical reform of the Common Fisheries Policy.

Document or Iniciative

Green Paper of 22 April 2009 – Reform of the Common Fisheries Policy [COM(2009) 163 final – Not published in the Official Journal].

Summary

The Green Paper shall analyse all facets of the current Common Fisheries Policy (CFP) and seek to explain why certain problems persist despite the progress made since the 2002 reform.

Outcomes of the Common Fisheries Policy

The CFP reform provided for a series of measures to ensure the viability of fisheries. The principal measures adopted under the 2002 reform concerned, amongst others:

  • the introduction of multi-annual plans for stock recovery and management;
  • the integration of environmental concerns into fisheries management;
  • establishing Regional Advisory Committees (RACs);
  • the setting of national ceilings to adapt the fishing capacity of fleets to fishing opportunities;
  • limiting the number of days that a vessel can operate at sea;
  • a gradual withdrawal of public funds for the construction or modernisation of fishing vessels, whilst maintaining aid for improving safety and working conditions on board vessels;
  • establishing fisheries agreements aimed at creating partnerships with third countries.

However, the objectives set in 2002 have not been achieved. Today, the Common Fisheries Policy is characterised by overfishing, fleet overcapacity, heavy subsidies, low economic resilience and a decline in the volume of fish caught by European fishermen. A radical change is needed to address these challenges.

Overcoming the five structural failings of the CFP

The depletion of European fisheries stocks is principally the result of fleet overcapacity. Several solutions are being considered to adapt the size of European fishing fleets to the stocks available. The use of transferable rights and/or the creation of a one-off fund could be a solution to this problem. However, accompanying measures aimed at preventing negative effects on smaller-scale fisheries and coastal communities still need to be drawn up.

The lack of clear political objectives, specifically with regard to ecological responsibility and the connection with general maritime issues, is the second weakness of the current CFP. The Green Paper shall consult the public on how to define the objectives in a clear and prioritised manner for decision-making and implementation.

The majority of decisions affecting the CFP are taken at Council level. This decision-making system is over-centralised and focused on short-term solutions, which compromises sustainability in the long-term. To alleviate this problem, decisions could be made jointly by the Council and the Parliament (co-decision procedure), leaving Member States, the Commission and/or the fisheries sector responsible for implementing the decisions. However, in this new system the role of consultative structures (the Advisory Committee on Fisheries and Aquaculture and the Regional Advisory Committees) should be increased.

The sector lacks responsibility. Therefore a rethink is required on how to give the fisheries sector more responsibility in implementing the CFP, whilst also finding the means of ensuring that the self-management of the industry achieves its goals.

The final structural issue tackled by the Green Paper relates to the absence of political will to ensure compliance. In order to increase compliance with the regulations, the benefits and disadvantages of centralised mechanisms (such as direct Commission action or national/cross-border controls) and de-centralised mechanisms need to be examined by submitting them to consultation.

Improving the management of European Union fisheries

Restoring the productivity of fish stocks is required in order to ensure the economic and social viability of the fisheries sector. In order to improve the management of fisheries, many ideas have been submitted for consultation. These ideas concern:

  • the possibility of introducing a differentiated regime to protect small-scale coastal fleets;
  • the adoption of Maximum Sustainable Yield (MSY) as a management principle and the introduction of long-term management plans in order to make the most of fisheries;
  • the relative stability of Community quotas and access to coastal fisheries;
  • trade in and the market for fisheries products and aquaculture products;
  • integrating the CFP into the broader context of maritime affairs;
  • scientific knowledge and data for policy decision-making;
  • Community funds for fisheries or national aid measures;
  • managing the fishing activities of Community fleets in non-EU waters in order to extend the principles of sustainable and responsible fishing to the international level;
  • the role of aquaculture in the future CFP.

Context

Although the Commission is only legally required to re-examine some of the dimensions of the CFP before 2012, the current situation, specifically with regard to stocks and fleet overcapacity, has convinced the Commission of the need to begin the reform process.

The consultation will close on 31 December 2009. It will form the basis of a public debate on the drafting of a proposal for a new regulation on the CFP. The latter could be presented to the European Parliament and the Council at the beginning of 2011, with a view to adoption in 2012.


Another Normative about Reform of the Common Fisheries Policy

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic

Organisation and financing of the fisheries sector

Reform of the Common Fisheries Policy

Document or Iniciative

Communication from the Commission of 13 July 2011 – Reform of the Common Fisheries Policy [COM(2011) 417 – Not published in the Official Journal].

Summary

The reform of the Common Fisheries Policy (CFP) will contribute to the Europe 2020 Strategy. In order to do this, it must participate in introducing sustainable and inclusive growth, enhancing cohesion in coastal regions and improving the economic performance of the industry.

The proposals made by the Commission are directed towards sustainability and long-term solutions.

Conservation and sustainability

Through fisheries management that eliminates significant negative effects on other stocks, species and ecosystems, the CFP will contribute to the Good Environmental Status in the marine environment, in line with the provisions of the Marine Strategy Framework Directive.

The measures adopted as part of the CFP reform should enable maximum sustainable yield (MSY) to be reached by 2015, in accordance with the international undertakings made by the European Union (EU). The highest catch that can be taken must not endanger long-term stocks. On the contrary, it should contribute to maintaining the size of the population at maximum productivity.

The measures envisaged also concern the elimination of discards at sea, long-term management plans based on the best available scientific advice, improving data collection and the availability of complete, reliable data for policy-making.

A future for fisheries and aquaculture

The CFP should make fisheries and aquaculture strong, viable, competitive and attractive industries. In order to increase economic viability and eliminate overcapacity, the Commission proposes to introduce a system of transferable fishing concessions for large vessels. The system should enable some operators to buy rights from other operators wishing to leave the industry. The system requires no public funding. Furthermore, it should enable incomes to be increased and new jobs to be created.

Support measures for small-scale fisheries and sustainable aquaculture could also be developed.

Consumer information

Consumers will be better informed of the quality and sustainability of the products they buy. Labelling may include environmental claims or production techniques.

Fishermen’s organisations will become active stakeholders as regards planning their members’ fishing activities, and will play a more central role in driving and supplying the market, as well as increasing fishermen’s profit margins.

Improving governance through regionalisation

The reform should foster solutions that are adapted to local and regional needs, taking better account of the specific features of the different sea basins. Key decisions concerning the general principles and objectives of the policy will still be taken at EU level. However, Member States will be able to take other fisheries management measures, under Commission control. For reasons of effective management, Member States will in particular be able to adopt technical conservation measures and anti-discard measures and transpose them in their national legislation.

The Commission envisages extending the role of the Advisory Councils when drafting conservation policy under the regionalisation model. Due to the specific nature of aquaculture, the Commission also proposes to create a new Advisory Council for Aquaculture.

Financial support

Public funding should cover all activities. It will be thoroughly simplified and will be linked to compliance with certain conditions (particularly of sustainability) by industry operators. The intervention regime under the Common Market Organisation will also be modernised. From now on, the setting of intervention prices will be decentralised and appropriate in order to avoid the destruction of surplus fish to maintain price levels.

External dimension

EU external actions are aimed at sustainability and safeguarding marine ecosystems. They are mainly based on strengthening cooperation in order to share scientific knowledge and to comply with established rules, in particular concerning the fight against illegal fishing.

The EU must play a stronger role in Regional Fisheries Management Organisations, international organisations and in its relations with third countries.

Sustainable Fisheries Agreements (SFAs) with non-EU countries must focus more on good management of marine resources, improving scientific knowledge and establishing a quality governance framework.

Context

The reform is based on a large-scale public consultation that was completed in late 2010. Contributions from stakeholders were used in drafting the reform, which includes the following:

  • a legislative proposal for a new Regulation defining the main CFP rules [replacing Regulation (EC) No 2371/2002];
  • a legislative proposal concerning a new market policy [replacing Regulation (EC) No 104/2000];
  • a legislative proposal for a new Regulation on the European Fund for Maritime Affairs and Fisheries;
  • a Communication on the external dimension of the CFP; and
  • a report on Council Regulation (EC) No 2371/2002 regarding the chapters Conservation and Sustainability and Adjustment of Fishing Capacity, and on Article 17(2) on fleet access restriction to 12 nautical miles.

Improving the economic situation in the fishing industry

Improving the economic situation in the fishing industry

Outline of the Community (European Union) legislation about Improving the economic situation in the fishing industry

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Competition > Rules applicable to specific sectors > Competition in agriculture and fisheries

Improving the economic situation in the fishing industry

Document or Iniciative

Communication from the Commission to the Council and the European Parliament of 9March 2006 on improving the economic situation in the fishing industry [COM(2006) 103 final – Not published in the Official Journal].

Summary

In the last few years, the economic situation of many fishing businesses has deteriorated as a result of:

Stagnating or even falling market prices, partly owing to an increase in imports and the development of aquaculture, but primarily because of the concentration of sales in big distribution chains and greater competition between fish and other food products.

Lower fishing yields, because the reduction in fishing capacity has not kept pace with the reduction in fishing quotas for the main demersal and benthic species since the mid 1990s. Reducing vessel tonnage and engine power has failed to stabilise the situation, as this reduction has been offset by the steady increase in the efficiency of fishing vessels, resulting in widespread overfishing. According to an assessment carried out by the International Council for the Exploration of the Sea (ICES), for most of the stocks assessed, overfishing is running at two to five times the level that would generate the maximum sustainable yield. *

An increase in fuel prices between 2003 and 2005, which particularly affected vessels with towed gear. Fuel costs can account for as much as 36 % of the value of landings and can mean operating at a loss. Consequently, crew members who are paid a share of the income generated by the catch have also suffered a loss of income.

At the moment, businesses targeting demersal species and using towed gear are hardest hit.

In the short term, Member States could help fishing businesses facing difficulties by granting aid in accordance with the Guidelines on State aid for rescuing and restructuring firms in difficulty.

Rescue aid

Rescue aid is intended solely to keep an ailing business financially afloat for long enough to give it time to look into the possibility of restructuring. It must last no longer than six months, and takes the form of a loan or guarantee, which may be repaid using the support subsequently received in the form of restructuring aid.

Restructuring aid

The Guidelines for the examination of State aid to fisheries and aquaculture allow State aid for modifying, modernising and equipping fishing vessels, subject to the same conditions that apply to Community aid granted under the FIFG.

Other types of aid for modernising and equipping fishing vessels may be allowed in accordance with the Community Guidelines on State aid to firms in difficulty. However, Member States would have to obtain the Commission’s approval for this. Aid should be limited to the minimum necessary, and restructuring must be based on realistic economic assumptions, which form the starting point for a restructuring plan. Furthermore, profitability must be ensured by reducing costs without increasing current overall fishing effort or capacity. The Commission will assess aid for the following investments in fishing vessels on the basis of the extent to which they contribute towards re-establishing the viability of the business concerned:

  • Changing fishing gear for the first time, resulting in a switch to a less fuel-intensive gear;
  • Purchasing equipment to improve fuel efficiency;
  • Replacing the engine with a new engine, which, depending on the size of the vessel and the fishing method, must be either of equal power or less powerful. For trawlers of more than 24 m in overall length, this must be accompanied by a switch to a new, less fuel-intensive fishing method. The Commission will verify the power of new engines of more than 130 kW on the basis of the “NOx certificate”. Any reduction in engine power funded by public aid will be deducted from the national fleet capacity ceilings. If a business operates several vessels, the Commission may agree to apply the reduction in engine power to that business as a whole. Similarly, where national schemes allow for the implementation of a restructuring plan put forward by a group of small and medium-sized enterprises (SMEs), the Commission may decide to apply the reduction to the group as a whole.

During the time needed to implement these investments on board fishing vessels, State aid for temporary cessation of activities is also allowed. Direct aid to subsidise fuel costs would constitute operating aid, which is incompatible with the Treaty. The fishing sector could, however, set up a contingency fund, but for this fund to be approved by the Commission, guarantees would have to be provided that all public aid would be reimbursed.

Member States should notify the Commission of planned rescue and restructuring aid schemes within two years of the publication of the Communication. The Commission will examine them as soon as possible on the basis of the relevant provisions of the applicable Structural Funds. Within two years of the Commission’s approval of a scheme, Member States should issue their administrative decisions.

In the long term, further action is needed to ensure the recovery of fish stocks and build a positive future for the fishing industry.

Improving fisheries management

Fisheries management could be further improved by:

  • Moving towards maximum sustainable yields (MSY). MSYs were adopted by the Johannesburg World Summit on Sustainable Development as a way of achieving stable management of fish stocks by 2015. Furthermore, they would bring economic benefits in terms of predictability of supply and revenue per unit of effort. Since the 2002 reform of the common fisheries policy (CFP), one of its aims has been the recovery of threatened stocks, which is a prerequisite for managing all of the major fisheries at MSY levels (see the Communication on the implementation of MSYs).
  • Ensuring economic management of fisheries. The Commission will publish a Communication on the bearing that the methods used by Member States to allocate fishing rights have on the economic situation of the fleet.
  • Improving governance of the CFP. The 2002 reform of the CFP provided for setting up Regional Advisory Councils (RACs) in order to achieve better compliance with the rules by increasing stakeholders’ involvement in fisheries management. So far, three RACs have been set up and a fourth is in the process of being set up. In 2007, the Commission will look at how to improve the functioning of the RACs.
  • Matching fishing effort to available resources. Overcapacity contributes to overfishing and reduces profitability, which is why it is necessary to decommission some vessels. A number of Member States have already set up decommissioning schemes. Both national and Community aid may be granted for decommissioning fishing vessels or reassigning them to other activities. Member States and the Community should also use the European Fisheries Fund (EFF) for this purpose.

Better compliance with fisheries management rules

In order to ensure fair competition, conservation of resources and the quality of the scientific advice on which the CFP is based, it is important that all fishermen comply with the rules. Steps should be taken to:

  • Strengthen controls. The new Fisheries Control Agency will verify that Member States are implementing fishing Regulations across the European Union (EU).
  • Step up the fight against illegal, unreported and unregulated (IUU) fishing, which some operators have adopted as a commercial strategy. The Commission will ensure that its action plan is implemented in order to deprive these operators of their gains from IUU fishing.

Improving the operation of the market

In order to give fishermen more added value, the Commission will look at new tools to improve the marketing of fish and fish products. It will also ask the Advisory Committee for Fisheries and Aquaculture to draw up a code of conduct for trade within the EU. Eco-labelling schemes could also promote sustainable fishing. The Commission’s recent Communication on this subject should encourage fruitful debate. Member States should use the EFF to improve the quality, added value and marketing of fish products.

Research into sustainable fishing

The Commission will ensure that the annual programmes adopted to implement the Seventh Framework Programme support:

  • Optimising, validating and demonstrating new concepts and new technologies which will enable energy savings to be made.
  • Designing more fuel-efficient fishing gear.
  • Generating renewable energy.
  • Developing and demonstrating new types of biofuels.

Funding

The EFF is available to Member States within the framework of their rescue and restructuring schemes, as well as to help finance fleet adjustment measures and support the necessary social changes in the affected fishing communities. Member States should distribute the financial resources among the different EFF funding priorities, while ensuring that the necessary funds are allocated to fleet adjustment measures in view of the gravity of the economic situation.

Background

Rising fuel prices, coupled with declining fish stocks, have reduced the profitability of the fleet. The Communication identifies the main factors contributing to the economic crisis in the sector, and suggests both short-term and long-term responses to improve the economic situation for fishing businesses by promoting measures designed to restore the balance between fishing capacity and fishing opportunities.

Key terms used in the act
  • Maximum sustainable yield: the maximum catch rate that will ensure sustainable fishing.

Related Acts

Communication from the Commission to the Council and the European Parliament of 4 July 2006 – Implementing sustainability in EU fisheries through maximum sustainable yield [COM(2006) 360 final – not published in the Official Journal].