EU paid 600% too much for foreign fish, auditors find

A shoal of (over-priced) Tuna. []

The EU paid up to six times too much for fish under its flagship ‘fishing partnership agreements’, a new report by the Court of Auditors found Tuesday (20 October).

They also accuse the European Commission of failing to ensure there was enough reliable data on the programmes – which affect developing nations around the Indian Ocean, the Atlantic and the Pacific – to ensure a new policy that fish stocks there were truly replenishable and sustainable.

In the worst example, the EU paid six times too much for tuna in its partnership with Mozambique, due to over-optimistic calculations about the likely haul.

Whilst not accusing any of the partners of fraud, the Luxembourg-based Court, which monitors and evaluates EU spending, concludes that “the real cost paid was frequently higher than the price negotiated”.

So for example, in 2012 the “unit cost per tonne” of tuna from Mozambique was calculated at around 120 euros. In fact, because of a low catch, it ended up being closer to 850 euros per tonne – more than six times higher.

The discrepancy comes because the EU pays partners in the developing world a fixed sum in advance for fishing rights, based on previous catch quotas.

But, in fact, those quotas were often wildly optimistic, auditors found, leaving the EU to pay the fixed level set in advance, even when actual catch came in way below expectations.

>>Read: The fight against illegal fishing: The EU’s role in a global challenge

Even worse, under the Fisheries Partnership Agreements (FPAs), the EU was left to pay extra if the total catch exceeds that in the agreement, but there was no ‘claw-back’ mechanism if the haul falls below expectations – as in the case of Mozambique and elsewhere.

Now the auditors are calling on the Commission to negotiate future agreements on a ratio by which it only pays for what it gets – something in its response the executive said it “accepts”, but would still be “subject to negotiations and agreement of both the EU and the third country concerned.”

The problem with those negotiations, according to sources, is that the developing nations can always walk away from the talks and simply sell their surplus quota to nearby countries such as South Korea – leaving them in a strong negotiating position.

Conversely, the Commission also has a trump card, in that the 70 million euro annual cost of the deals is relatively small for the EU – but a major source of funds for the recipients.

In fact, that cost has already dropped. In previous years, it reached around 200 million euros.

The 58-page report, 13 months in the making, concerns the so-called ‘distant fleet’ shipping vessels of EU members states – largely those of Spain and France.

Under the EU special partnerships, they may sail to far-flung oceans such as the Indian Ocean and Pacific, and fish in the territorial waters of countries such as Mozambique, Mauritania, Madagascar and the Seychelles, among others.

In return, the EU pays both an “access fee” for the right to fish, and a “sectoral support” fee, to help those countries’ developing fishing infrastructures.

>>Read: Thai seafood products could be banned, warns MEP

The more recent Sustainable Fishing Partnership Agreements (SFPAs) see recipient states sell only their “surplus” fish requirements in an attempt to ensure fish stocks are sustainable.

But the report finds: “However, the concept of ‘surplus’ is very difficult to apply in practice due to a lack of reliable information on fish stocks and the fishing efforts of domestic fishing fleets, or of other foreign fleets which have also been granted access by the partner countries.”

Although the ‘distant water fleet’ of the EU comprises just 1% of the EU’s total fishing fleet, it provides some 15% of the total catch of the fleet.

The report does praise the European Commission, overall, for its handling of the complex negotiations with the 14 partner states, saying “the audit concluded that FPAs are generally well-managed by the Commission”, but adds that there are “still several areas for improvement”.

A member of the court told, “The devil is in the detail. The intention to be sustainable is laudable, but there is a problem with the data. We are not sure of the quality of the data of the catches.

“In general, the FPAs are well-managed by the Commission – but there are a lot of ‘buts…’”

The EU pays for its deals with the developing world nations in two ways – a straightforward “access” payment for the right to fish in their territorial waters, plus a “sectoral support” payment which is designed to help the recipient nation improve its fishing infrastructure and sustainability programmes, health and safety training for fishermen, and the like.

The Court of Auditors report looked at four of the 12 FPAs in force at the time of the audit – those with Mauritania, Madagascar, Mozambique and the Seychelles. Those four represented 77% of FPA payments in 2013.

It is not the first time, this month alone, that EU fishery policy in the Indian Ocean has come under scrutiny.

>>Read: Commission pressure Thailand over illegal fishing

On 1 October, the EU issued “yellow cards” against Taiwan and the Comoros, and upheld the existing one against Thailand, for failure to fully cooperate in the fight against illegal, unreported and unregulated (IUU) fishing.

The yellow card systems acts as a warning – a red card could see exports to the EU banned. Sri Lanka, Guinea and Cambodia have been issued red cards.

The principle of free access to the high-seas was gradually replaced during the 1970s, culminating in the 1982 United Nations Conference on the Law of the Seas, which gave state sovereignty of waters up to 200 miles from their shoreline, in a so-called Exclusive Economic Zone.

In response, the European Economic Community (as it was at the time) brought in fishing agreements with developing countries but largely on a 'pay, fish and go' principle.

In 2002, the EU brought in Fisheries Partnership Agreements, with financial contributions split into two parts - access rights to the EEZ and 'sectoral' financial supports, aimed at promoting sustainable fisheries development in partner countries.

That was further refined in 2014, with the introduction of Sustainable Fisheries Partnership Agreements (SFPAs), which aimed to only fish in EEZ waters where an available 'surplus' supply meant stocks were sustainable.

Subscribe to our newsletters