European Parliament

European Parliament Producers’ Organisations and the Common Market Organisation of fishery products Brussels, 5th November 2008 Dominique AVIAT, AND International

Contents • Introduction : context, methodology approach • Effectiveness of the measures concerning POs • Effectiveness of the measures concerning the trade with third countries • Contribution of the instruments of the CMO to the competitiveness of the industry • Contribution of the instruments of the CMO to the employment in the fisheries sector • General conclusion : which prospects for a CMO in line with the stakes and the globalisation of the markets ?

Introduction : methodology approach • Framework contract FISH/2006/22 : evaluation of the CMO as laid down in Council Regulation (EC) N°104/2000 • Time scope : 2001-2007 • Geographical scope : EU-27 • Methodology : 3 phases • Structuring : October-December 2007 • Observing : January-April 2008 • Analysing-Judging : May-June 2008 • Methodology : 4 themes • Income of producers • Market development and balance • Consumer aspects and quality • Coherence with CFP

Introduction : methodology approach • Core of the evaluation work : replies to of the 7 evaluation questions : • Effects of CMO on stability of markets • Effects of CMO on competitiveness of the sector • Effects of CMO on employment • Effects of CMO on producers’ income • Effects of CMO on product quality • Effects of CMO on consumers’ knowledge about fishery products • Effects of CMO on development of sustainable fisheries

Effectiveness of the measures concerning POs • Data on POs : 2 main sources : • Mail survey to all POs • Response rate : 39% • 100 interviews in 10 MS : • POs • National authorities • Professional organisations • Experts (Research institutes, NGOs, …)

Effectiveness of the measures concerning POs • POs’ main features : origin and role • Origin : • Ex-nihilo creation • Recognition of a pre-existing organisation • Merger • Motivations of PO’s constitution • Strengthening of marketing capacities • Strengthening of possibilities of collective action • Need to regulate the supply to adapt it to the demand • Need to concentrate the supply • Reasons of membership for producers • Scope for benefiting from a marketing strategy or product valorization actions • Strengthening of political action possibilities • Access to better adapted fishing quotas • Scope for access to withdrawals and carry-overs

Effectiveness of the measures concerning POs • POs’ main features : POs’ development

Effectiveness of the measures concerning POs • POs’ main features : POs’ development • Evolution of recognition withdrawals

Effectiveness of the measures concerning POs • POs’ main features : recognition, representativeness and concentration of POs • 1 of the 3 following conditions to be fulfilled • Production criteria more used than vessel criterion : • Criterion 1 : 19% of POs • Criterion 2 : 43% of POs • Criterion 3 : 38% of POs • Conditions 2 and 3 cumulated in several MS

Effectiveness of the measures concerning POs • POs’ main features : recognition, representativeness and concentration of POs • Representativeness level : • Very important for relevance and effectiveness of measures taken • 70% on average • Varies according to MS and regions • Concentration • 53% of POs in 3 MS

Effectiveness of the measures concerning POs • POs’ main features : structuration level in MS • On average 57% of EU fishermen are members of a PO • Structuration level varies according to MS, activity and species • 3 groups of MS : • Strongly organized countries (75% to 90% of fishermen are members of a PO) : BE, DK, NL, PT, SE, UK. • Average countries (between 35% and 75%) : DE, ES, FR, … • New MS, in early stage of structuration (less than 35%) : LV, PL, … • Activity : • Example of Spain : • Frozen fish producers : 80% POs • Fresh fish producers : 35% POs • Species : structuration level depends on location of fishing grounds, type of fishing, …

Effectiveness of the measures concerning POs • POs’ main features : operational programmes (OPs) • OPs = one of the main points of the 2000 review • Obligation of PO’s : draw up every year an OP comprising : • the marketing strategy, • a catch plan, • anticipatory measures to adjust the supply of species difficult to market, • a system of internal penalties • OPs’ target = giving more responsibility to POs in the planning of production and marketing of fishery products • Content and quality of OPs : extremely variable = from a very basic and purely administrative document to a real strategic document with a reflection on market and management of resources • Effectiveness of OPs : weak (a few local results on quality management and regulation of catches), but educational interest which could lead to medium-term results

Effectiveness of the measures concerning POs • Assessment of the extension of rules • CMO regulation : if a PO is considered to be representative of production and marketing in one or more landing places, the MS may require non-member producers who market products within the same area to comply with rules of the PO. • Extension of rules : rarely used (in only 6 MS). • Grounds for underutilization : lack of clarity of the measure and complexity of the procedure • No need of the measure for POs representing 100% of landings in their area • Noticeable effects for POs using the measure, especially in addition to internal rules of limitation of daily catches

Effectiveness of the measures concerning POs • Assessment of use of CMO measures and FIFG aid concerning quality • Assessment of plans to improve quality (PIQ) • PIQs give access to specific recognition and specific financial aid • PIQs must include : • Improvement in the quality of products onboard or in farm • Optimal maintenance of quality along the marketing • Description of the planned measures (including preparatory studies, training and investments) • Very weak success of the measure : only 5 plans submitted, 4 recognitions granted • Grounds for underutilization of the measure : • Measure little known to POs • PIQs demanding a lot of administrative work, costly and insufficiently subsidized • FIFG aids easier to obtain  Improvement of product quality : much more achieved with FIFG aids than with CMO tools

Effectiveness of the measures concerning POs • Effectiveness of the measures adopted by interbranch organisations and POs’ associations • Interbranch organisations (IOs) • Target of the measure : recognition of interbranch organisations aimed at improving structuration of production, transparency of the market and organisation of the sector • Very limited success of the measure : • Only 4 organisations recognized • No impact of IO recognition on power and capacity of IOs to structure the sector • IO recognition = rather a recognition a posteriori, a sort of label granted by EC to existing organisations • Measure not motivating enough for the creation of new IOs • Measure not offering an adequate framework (in particular transnational) to the organisation needs of the sector

Effectiveness of the measures concerning POs • Effectiveness of the measures adopted by interbranch organisations and POs’ associations • POs’ associations at transnational level • Only 1 association recognized (Association of Danish and German POs producing North Sea shrimp) • Positive effects : • Concentration of supply strengthening of producers’ weight vs. buyers positive effect on prices and producers’ income Price of Noth Sea shrimp (crangon crangon) on the Dutch market(€/kg)

Effectiveness of the measures concerning the trade with third countries • Measures : • Suspensions of common customs tariff duties • Autonomous tariff quotas • Noticeable and positive effects on supply of EU processing industry • CMO trade measures have allowed EU processors who cannot find volumes and/or prices adapted to their needs in EU to work competitively and to maintain their activity • Strong financial impact (e.g. : economies on Alaska pollack imports = 60 M€) • Positive effects on competitiveness and employment • Access to low price raw materials impact on margins maintenance of profitability of processing companies saving of associated jobs

Contribution of the CMO instruments to the competitiveness of the industry • Measures : • Strengthening of POs and IOs and obligation to define the marketing strategies in the OPs • Trade regime • Only the measures of trade with third countries have had a direct effect, but only for the processing industry • They have assured EU processors of supplies adapted to their needs in terms of volumes and prices to work competitively and to maintain their activity • They have had a net effect on economic performance of companies impact through the economy on raw materials • The application of these measures has not disturbed the EU production, which is in strong deficit on these markets (self-sufficiency rate of EU : 40% in 2006)

Contribution of the CMO instruments to the employment in the fisheries sector • Measures : • None of the CMO measures is aimed at direct intervention in favour of employment • Main tools concerned : • Stucturation of POs and IOs • Trade regime • CMO has no effect on fisheries employment, much more dependent on CFP, TACs, oil price and lack of appeal of fisheries jobs • Effects of CMOs on employment usually linked to volume direct aid to producers and first processors. CMO fishery : small level of financial aid to intervention (10 M€/year)

Contribution of the CMO instruments to the employment in the fisheries sector EAGFF expenses for CMOs in 2005

Contribution of the CMO instruments to the employment in the fisheries sector • Professional structuration and concentration of supply : no effects on employment, except in some rare local cases • Only the measures of trade with third countries have a direct effect, but only for the processing industry • trade regime measures = effective tools to guarantee to processors an adequate supply with imported raw materials (whitefish, tuna, …) contribution to maintenance of companies and safeguarding of jobs • but CMO has not allowed to prevent relocation of canning companies in third countries with low labour cost

General conclusion • CMO = a complex tool box, used in very various ways in EU • CMO = a logic of action and sets of measures inherited from agricultural policies, but without the financial means of agricultural CMOs • CMO = a not very interventionist and relatively efficient CMO (structuration and concentration of offer), which has assets for a transition towards a system in line with today’s stakes • CMO = very limited effects on competitiveness, income and employment • CMO = POs central actors in the system of market organisation and stabilization • PO tool = main element of capitalization of CMO  With some adaptations and clarifications of their missions and with strengthened and more durable means POs can be relevant and potentially effective supports for the implementation of most CFP policies

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