Changes
to ITQ introduced in the Fisheries Amendment Act 1990, and the setting
of the TAC and TACC
(Represents the views of the MFish author only)
Background
The 1983 Fisheries Act [s89(1)(g)] provided for the setting of a
Total Allowable Catch (TAC) by the Minister of Fisheries through
regulation. No such regulations were promulgated. The TAC was defined
as “the amount of fish, aquatic life or seaweed that will
produce from that fishery the maximum sustainable yield, as qualified
by any relevant economic or environmental factors, fishing patterns,
the interdependence of stocks of fish, and any generally recommended
sub-regional or regional or global standards”.
The Fisheries Amendment Act 1986 introduced a quota management system
which had the effect of restricting the output of almost all significant
commercial fish species by way of individual transferable quota
(ITQ) to take fish. The individual allocations were expressed in
tonnage terms and represented that entity’s fixed allocation
within the total allowable catch available for commercial fishing
(TACacf) for that quota management area.
The TACacf represented the total allowable catch available for commercial
fishing within a designated area. When setting a TACacf, the Minister
of Fisheries was required to allow for “Maori, traditional,
recreational and other non-commercial interests in that fishery”.
These other removals while considered were not formally allocated
an allowance as presently occurs.
Section 28D of the Fisheries Amendment Act 1986 permitted the Minister
to reduce the TACacf and to compulsorily reduce ITQ. The Act required
the Minister to give affect to a reduction, if made, either proportionately
across all ITQ holders for that fishery (in which case compensation
was to be made based on fair market value of the ITQ) or through
the purchase of ITQ by the Crown. The TACacf could also be increased,
thus allowing the Crown to either hold the additional ITQ arising
from the increase or to sell it.
The Fisheries Amendment Act 1986 also provided for the payment of
annual resource rentals by ITQ holders. These rentals were based
on the tonnage amount of the ITQ and were payable irrespective of
whether the ITQ holder landed fish or not.
At the time the ITQ allocation system was introduced the TACacfs
set were considered to be conservative. It was thought likely that
further research on the abundance of fish stocks could well lead
to increases in the TACacfs. Government would therefore have the
prospect of possible future gains arising from the sale of ITQ.
It was also considered at the time that fixed ITQs were necessary
to facilitate development and investment in the industry. In addition,
at the time ITQ was implemented, the Government paid out substantial
sums to reduce catch effort in fisheries under pressure. The Government
considered with good management that these stocks would recover
thus permitting it to recovery its “investment” by disposing
of ITQ when it became available.
By early
1989 it had become clear that the abundance of fish stocks was more
variable than was first thought and that some significant reductions
in TACacfs might be required particularly for orange roughy and
hoki. Substantial compensation might be involved. It was also apparent
that a fixed ITQ provided the wrong incentives for ITQ holders and
placed the risk of stock variability and management on the Crown
not the industry. In mid 1989 Cabinet directed officials to discuss
with industry and Maori the implementation of a proportional ITQ
system that would place the risk of variations in the abundance
of fish stocks on the industry rather than the Crown. These discussions
eventually lead to an agreement with industry, referred to as the
“accord”, which is largely expressed in the Fisheries
Amendment Act 1990.
Fisheries Amendment Act 1990
The Amendment Act introduced the proportional ITQ arrangements reflected
in the current Fisheries Act. It also established a staged process
for the payment of compensation including the “freezing”
of resource rentals .
In addition to these changes, the Act replaced the expression “total
allowable catch available for commercial fishing” with a “total
allowable commercial catch” (TACC). In setting a TACC the
act stated that the Minister “shall-
After having regard to the total allowable catch for the fishery,……,
allow for-
Maori, traditional,
recreational, and other non-commercial interests in the fishery;”
This drafting change was intended to clarify the intent of the TACC
and to avoid any confusion that may previously have existed between
the TACacf and the TAC.
The Act provided a transitional arrangement whereby previously set
TACacfs became TACCs. The effect of this, at the time of the amendment,
was that QMS fisheries had TACCs but no TACs.
Fisheries Act 1996
Section 20 of the Fisheries Act 1996 requires the Minister when
varying a TACC to set a TAC. Over time this has led to the Minister
setting TACs for some QMS fisheries. There are still a number of
QMS fisheries that do not have a TAC set by the Minister of Fisheries.
When the Minister sets a TAC for those QMS fisheries without a TAC,
such as in the recent SNA2 decision, this decision making process
isn’t protected by the provisions of section 308 2(b). These
protections only apply when the stock is introduced into the QMS,
not subsequently, even though the TAC might not have been established
on introduction. This is the reason why, in the case of SNA2, the
Minister could not have contemplated a reallocation from commercial
to recreational fishers, without considering the issue of compensation.
Further information about this process can be found in Hansard 6
March 1990, and Hansard 29 March 1990 available at www.knowledge-basket.co.nz
Resource rentals were phased out and replaced with a cost recovery
scheme in the Fisheries (Amendment) Act 1994.
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